“War is the continuation of politics by other means” – Clausewitz, On War
Published in 2016, this book by Robert D. Blackwill and Jennifer M. Harris studies how states are applying economic instruments to advance geopolitical ends and how these geoeconomic practices could be translated to American foreign policy.
Offering a overview of geoeconomic tools, as well as demonstrating the American geoeconomic potential, the book by Blackwill and Harris gives compelling insights into how contemporary inter-state conflict plays out.
What makes it interesting to look back on, is the recent emphasis on economic policy in two recent American government documents.
The 2017 National Security Strategy emphasized the importance of economic security as an aspect of national security. The NSS, as well as the 2018 National Defense Strategy, also label China and Russia as “strategic competitors.” As such, these documents arguably mark the end of the 9/11 era. Interestingly, while calling out “predatory economics,” both strategies do not talk about China’s Belt and Road or related institutions (as also argued here).
Geoeconomics or new geopolitics?
Using the phrase ascribed to the Prussian general Carl von Clausewitz, the title may suggest that economic statecraft has replaced military power as the primary means of warfare. This confusion is eloquently explained here. As such, the book’s cover may yet be a better illustration for the topic.
On the cover, a chessboard is visible on which both traditional pawns and rolls of money are strategically placed. Indeed, Blackwill and Harris emphasize that modern geoeconomics is “embedded within [the] larger realities of state power [and] inextricably intertwined with military and diplomatic strands of foreign policy.”
The term geoeconomics captures the “systematic use of economic instruments to accomplish geopolitical objectives.” However, today’s military crises, such as the Russian invasion of Crimea, lead commentators to laud a new era of geopolitics instead. As a result, geoeconomics is rapidly dismissed. However, Blackwill and Harris argue that this skepticism misses the point.
To argue that states are looking more and more toward economic methods of advancing their geopolitical aims is not to suggest that the potential use of military force does not also remain an important ingredient in how many states pursue geopolitical aims. But it is no longer a sufficient ingredient, or usually even the leading one.
What then led to the modern resurgence of geoeconomics? The question here is why today’s rising powers are “increasingly drawn to economic instruments to project their influence and conduct geopolitical combat.” For Blackwill and Harris, there are three basic factors. These are the lack of alternative means, a bigger arsenal of economic resources and changes in the global markets.
These factors are by American military might, modern state capitalism and globalization. Consequently, today’s central geoeconomic powers are those countries with vast amounts of wealth and/or economic leverage at their disposal. Central to this book are Russia, China and other state capitalists. The USA is notably absent in this story of economic statecraft.
The lost art of geoeconomics
Blackwill and Harris describe the history of America’s geoeconomics and the decay thereof in great detail. Indeed, in coming to terms with challenges ranging from Crimea to Iran, the US “instinctively debates the application of military instruments to these complex challenges.” Furthermore, it seems that except for sanctions, America has developed a bias towards political-military thinking.
In comparison, the authors argue, “the rest of the world has moved in the opposite direction.” Consequently, economic statecraft has become a “lost art in Washington.” This is seen as a fairly modern development. Indeed, the Louisiana Purchase and the Marshall Plan are but two examples of American geoeconomics.
Instead of militarily conquering the French territory, president Jefferson simply bought it. The reconstruction of Europe with American aid as well contributed to the construction of today’s US-led order. However, as the authors demonstrate:
By the Johnson and Nixon years, geoeconomics had noticeably begun to wane. The war in Vietnam pushed geoeconomics off the U.S. policy stage. It gained momentum with Washington’s military response to the Soviet invasion of Afghanistan; the interventions in Angola, Lebanon, Grenada, and Panama; the first Gulf War; the air campaign in the Balkans; 9/11 and the wars in Afghanistan and Iraq; U.S.-led NATO intervention in Libya; the American drone and combat air attacks across the greater Middle East; and the re-introduction of U.S. ground forces in Iraq.
As to the reasons of this structural divide, the authors are frank: “the short version is a combination of neglect and resistance, [but] not so much ideological discomfort or bureaucratic paralysis.”
During the Cold War, “America became hyperfocused on the military dimensions.” But interestingly, after the Soviet Union had fallen, American economic policy remained “focused on economic outcomes.” According to the authors, this policy stems in part from “the unwillingness of economists to perceive themselves and their discipline as embedded in larger realities of state power.”
As such, Blackwill and Harris define geoeconomics as “the logics of geopolitics [combined] with the tools of economics.” These economic instruments, “when put to geopolitical use, can produce outcomes that are every bit as powerful and as zero-sum as those resulting from traditional military showings of state power.”
A moment is but a moment
With Russia and China demonstrating increasingly assertive behaviour, it seems clear that the American unipolar moment has ended. As the authors argue:
Now the end of history has itself come to an end. The United States finds itself competing for global influence and ideas – and doing so alongside a set of states, many of them rising powers, that pledge no particular allegiance to these same liberal economic understandings, do not make any such disciplinary divides between geopolitics and economics in their own policy making, and are thoroughly comfortable with harnessing economic tools to work their strategic will in the world. The result is a set of challenges for which the current tools of U.S. statecraft, dominated by traditional political-military might, are uniquely unsuited.
With several dedicated chapters, China holds a central spot throughout the book. As the “world’s leading practitioner,” the authors describe the country as “the best available lens to understand how geoeconomic tools operate in practice and how they can be combined.”
Arguing that China’s regional and global power projection has become a largely “economic (as opposed to military) exercise, the authors test some six case studies. These range from Taiwan’s economic dependency on China to the expansion of China’s sphere of influence in Southeast Asia. Interestingly, China’s Belt and Road is only mentioned in passing.
Here, the authors raise two fundamental questions. These are whether geoeconomic pressure works and more importantly, how we can recognize geoeconomic statecraft. Blackwill and Harris show that evidence is either circumstantial or exaggerated. For example, there are “natural limits and internal tensions” to China’s economic statecraft.
Insightful for today’s day and age
As such, geoeconomics is “not a perfect tool, [but] whether successful or not, tried or implied, [it] produces a substantial coercive overhang that will be an Asian reality for at least the next few decades.” As a result, the results of China’s economic statecraft is palpable in the foreign policy behaviour of target states (as studied here).
In America, the authors want to shift the terms of the debate, to have a global American geoeconomic policy bolstered through trade, finance and investment.
Because of the emphasis on China, the book could benefit from a more in-depth discussion of China’s Belt and Road. Nadège Rolland for example demonstrated the economic and strategic drivers behind these new Silk Roads. At the same time, Blackwill and Harris offer a valuable framework.
Furthermore, the book raises several questions that we cannot but ponder. How, for example, do target states respond to economic statecraft and how will American economic statecraft play out under president Donald Trump?
War by Other Means is an impressive study of economic statecraft employed by today’s rising powers. As such, the book is as valuable in its historical overview, in its theoretical exposition, as in its policy making prescriptions.