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The Screaming Twenties: How Elite Overproduction May Lead to a Decade of Discord in the United States

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Fighting was common in Congress in the Antebellum United States. Congressmen frequently brawled and dueled one another, and some openly carried knives and pistols.
Photo Credit: US Library of Congress

One of the great stories about the United States in recent years has been the rise of political polarisation and instability. Though the growing strife at the heart of the nation has been in the making for decades, the last year alone has seen the Covid Crisis, the death of George Floyd and the subsequent Black Lives Matter movement, as well as an election process that climaxed with the storming of the U.S Capitol Building. To any observer, it is apparent that these events have continued to exacerbate cleavages in American political life, and it seems that such divides will not be bridged anytime soon. The great fear is that US in the 21st Century may be facing a period of political instability, competing radical ideologies and ever-widening inequality. The last century in the US saw a post-World War One resurgence in the Roaring of the 1920s- will the 2020s in contrast see us dragged Screaming through the decade?

The United States is not alone in facing this problem. France has faced nationwide protests since 2018 with the gilets jaune movement, whilst the United Kingdom faced political paralysis and partisan infighting with the Brexit referendum (while Northern Ireland faced some of the worst riots its seen in years in part due to the Irish Sea Border). Many hypotheses have been put forward about the source of the discontent that has been rising in the United States and the rest of the Western world. Yet no theorisation, I believe, can claim to be as unique or intriguing as that of elite overproduction, and there is reason to believe that the 2020s will continue to see increasing political instability because of it.

Peter Turchin, whose work has been gaining increased recognition as of late, uses Structural Demographic Theory alongside a way of studying the long-term dynamics that create conditions for political stability, and in turn, political disintegration, and uses this to analyse history. Turchin proposes that all structural-demographic variables that influence the (in)stability of a given society are encompassed within three forces: the population, the state, and the elites (with each of these categories subject to change in response to structural shifts).

The main components of Structural-Demographic Theory. Photo Credit: Peter Turchin

Though there is more to this theory that can be outlined here (if interested, Turchin’s Ages of Discord and blog come highly recommended), what is perhaps most compelling are the dynamics of intra-elite warfare, caused by what Turchin dubs elite overproduction.

Who are the elites? It is not just the capitalist class as such, but also lawyers, professionals, journalists, and cultural figures. These are the most highly vaunted positions within society that aspiring elites seek to enter in order to move up the social ladder. Yet what happens when the numbers of the elite and those who wish to enter the elite classes become too high for the society to adequately accommodate? This is what is known as elite overproduction.

When there is an oversupply of elites and elite aspirants, this creates the conditions for elite overproduction. Elite overproduction is usually created and influenced by factors such as labour oversupply which leads to increased competition for resources and jobs), popular immiseration, and declining living standards thus further swelling the ranks of elite aspirants seeking to work their way into the elite classes in order to secure a future for themselves, as well as the revenues of the state and its ability to absorb these candidates. The result of these factors can be an increasingly large class of elite aspirants who find themselves spurned, a government and society that hasn’t the capacity to absorb them, as well as an elite class that benefits from these conditions and will often go to great lengths to protect their position.

Elite Overproduction mapped against popular well-being in the US. Image Credit: Peter Turchin

So where can we see elite overproduction? Turchin uses the case of Law graduates in the United States, as well as US wealth inequality as measurements of this phenomenon. Law happens to be one of the most popular degrees chosen by those wishing to enter politics, and is seen by aspiring elites as a way to attain professional prestige. Yet the value of a Law degree is relative and is not above the laws of supply and demand. Of those graduating in 2015, only 63% of law graduates entered jobs that required the bar, and as of July 2020, those who majored in Criminal Justice had an underemployment rate of 73% ( meaning they are working jobs that don’t utilise their skills and are unable to work the hours they’d wish to).

Whilst it is certainly true that not all those that graduate in Law intend to practice it, there is a great deal of evidence to suggest that a large surplus of Law graduates is created in the U.S every year- a problem that is only compounded by the large student debt that they are left with, as well as the high hopes that many had for themselves. And this is only looking at Law graduates in the US. In the UK for example, nearly one-third of graduates were underemployed pre-Covid, and this likely to be much higher in the near future with the added complications of the Covid Crisis and the recession that followed it. When this is combined with declining living standards and anemic economic growth, you will see the creation of a class of embittered and scorned counter-elites, who hopes to join the elite classes has transmuted into resentment against them. It was understanding this frustration that led to the rise of politicians like Bernie Sanders and Jeremy Corbyn, who capitalised on the anger of many elite aspirants in the U.S and the U.K respectively.

Yet elite overproduction is not just about the elite rejects per se, but also about conflict amongst the elites themselves. It is no secret that wealth inequality has been on the increase for decades, leading to vast wealth gains not only amongst the economic hyper-elite, but also creating a proliferation in the number of millionaires within the US. What is perhaps less well understood is the effect this has on inter-elite dynamics. Wealthier citizens are typically more politically engaged than the rest of the populace and may even run for office themselves. Yet the supply of political offices to pursue within the United States has largely remained flat. For example, the number of congressional seats has remained at 435 since 1913, whilst the supply of those seeking political influence and potential candidates only continues to rise. Elite overproduction can therefore even lead to a kind of elite class warfare, where the elites who feel themselves to left out of power and influence begin to fight those who they see as standing in their way, and the elite class itself begins to fracture under such conditions.

So how do elites react to these circumstances, and how does it lead to further political destabilisation? Turchin argues that there are essentially three cardinal sins that the elites often make in these conditions. Firstly, when there is a labour oversupply, the elite classes stand to benefit most from this as they are frequently the beneficiaries of cheaper labour and may even promote mass immigration for this very reason, and thus inequality begins to sky-rocket. Secondly, in an attempt to make their own positions more secure, they raise the bar to elite entry, kicking the ladder away from their would-be competitors and securing not only their own position but also that of their offspring, who will benefit from their built-up economic and social resources and stand a better chance of circumventing the obstacles they have raised. Lastly, the top earners of the society will often do anything to resist taxation and to maintain their own wealth at the expense of public spending – which leads to a dysfunctional and indebted state that people begin to lose faith in and respect for. Fundamentally, these elites stand to gain from the status quo, and many of them would rather defend their privileges than reform the system for the betterment of their country. This is a failing that does not go unnoticed. As Turchin writes, ‘Such selfish elites lead the way to revolutions’.

So what happens when the established elites and the counter-elites (both the spurned elite-aspirants as well as the excluded, competing elites) clash?. The elites who seek to maintain their own positions end up fighting amongst themselves over power and begin to fragment as a result, and they also face the embittered counter-elites that seek reform (and even revenge). The resulting situation is an increasingly unstable society in which the elites themselves attempt to hold onto their privileges at all costs against their competitors, whilst the counter-elites, who view themselves as having been betrayed by the status quo, fight to change this situation and seek the recruit some of the aggrieved population to join their cause. The political situation in such a society sees a breakdown in cooperation in the elite classes as they squabble over power, the breaking of acceptable norms as the fighting becomes more vicious, and an increasing amount of political instability and violence. With the events of 2020 still fresh in our memories, one cannot help but see some truth in this analysis. But what is concerning is that, as seen in the graphs above, is that the events of 2020 may not, in fact, be an aberration. Instead, 2020 may be a particularly memorable representative of a wider trend. As popular immiseration only deepens, as government debt only increases, and as elite overproduction shows no meaningful signs of slowing down, 2020 may have only been a warm-up for what is coming next.

So, what does this mean for the next decade? Though there seems to have been some stability restored to American politics with the election of Joe Biden, one would have to be very optimistic that the political polarisation and increasing levels of violence and protest in the United States are gone for good. Some 45% of Republicans according to one poll actually supported the actions of the Capitol Hill rioters, and some 68% didn’t consider it a threat to democracy- a worrying sign that extreme action is becoming increasingly acceptable in some quarters of American politics. Though the Democratic party controls both legislative chambers in Congress, their majorities are slim, and will likely require a great deal of political skill from Joe Biden to pass even the most modest legislation, never mind offering up bold solutions to America’s woes. It is highly unlikely that the increasing levels of polarisation and instability that 2020 seemed to typify are going anywhere anytime soon.

What the work done by Turchin seems to suggest is that the next decade is likely going to see an exacerbation of the trends that led America down its path to instability, and the 2020s may well be a decade of discord for the U.S. The real question at this point is not a case of whether unrest and instability will unfold, but rather how serious will it get? If reform is not taken and cooperation continues to break down among the elites, the next decade may be Screaming rather than Roaring. Though it is not impossible for these trends to be effectively challenged and reversed, it would require a certain degree of unity and purpose amongst American elites to take the necessary actions, and it is this unity and leadership that America has been sorely lacking. Perhaps an understanding of just how dangerous the situation is and may become could change this. Time will tell.

Sino-ASEAN relations: a marriage in crisis?

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The 18th ASEAN-China Summit in Kuala Lumpur, November 2015 , Licensed via Creative Commons

The partnership between China and ASEAN countries has seen its ups and downs.

The period between 2003 and 2013 was hailed as a “Golden Decade” of Sino-ASEAN relations, where the two parties built political trust and strong economic ties. Concurrently, the decade between 2014 and 2024 was optimistically introduced as the “Diamond Decade”, with ambitions to further promote partnership and friendship between the two. However, events did not proceed as either had hoped. Instead, during the so-called Diamond Decade, the once prosperous relationship has become a rocky marriage. Geographical neighbors with an ongoing territorial dispute in the South China Sea, China and ASEAN nations have recently grown mutually suspicious and, after the harmony of the Golden Decade, the Diamond Decade seems to have ended in a vicious cycle of distrust.

Dialogue between ASEAN and China began in 1991. By 2002 the two began to work towards a free trade agreement. Eventually established in 2010, today the ASEAN-China Free Trade Area (ACFTA) is the world’s largest FTA by population, and the third largest by economic size, after the North American Free-Trade Area (USMCA) and the European Union (EU). China and ASEAN countries have also proved highly complementary in energy cooperation, with ASEAN countries richness in natural resources met by China’s insatiable demand for enormous amounts of energy to power its economic machine. Indonesia, Malaysia, and Brunei are abundant in oil and gas, while Vietnam, Laos and Myanmar boast hydropower resources. China National Offshore Oil Corporation (CNOOC), China National Petroleum Corporation (CNPC), and Sinopec, have participated in oil and gas production since the 1990s in countries like Indonesia, from land and shallow water to deep sea. Thus, where ASEAN countries lack proper infrastructure, China provides oil and gas exploration technology.

Unfortunately for both sides, economic cooperation is not enough to tie together a geopolitical relationship. Over recent years, having become the dominant regional power, China has implemented a “Push and Pull Strategy” towards ASEAN countries. Through the territorial disputes in the South China Sea, China “pushes” and advances its position at the expenses of ASEAN interests, displaying growing assertiveness. While, on the other side, China “pulls” ASEAN countries towards its orbit, using massive development projects such as the Belt and Road Initiative. Thus, in the eyes of ASEAN countries, Beijing today represents an emerging threat while remaining a key trading partner – a source of opportunities, and a source of challenges. The union between China and ASEAN countries continues, yet in the Diamond Decade the spectre of doubt starts to creep in.

The US Navy, US Coast Guard, Royal Malaysian Navy, and Malaysian Maritime Enforcement Agency are sailing side-by-side in the Strait of Malacca. Photo Credit: US Pacific Fleet, licensed via Creative Commons

The intervention of major powers in the region has added a new layer of complexity to the situation, dividing the region even further. The Quadrilateral Security Dialogue, also known as the Quad, has recently been revitalized, as anti-Chinese sentiments have hardened not only in the United States, but also in Australia, India, and Japan. Additionally, the navies of France, Germany, UK, and the Netherlands are deploying naval forces to the South China Sea to support Quad activity. Recently, the warships of India, Japan, Australia and the US have been exercising near the Strait of Malacca, which is a key waterway for Beijing, with 80% of its oil supply passing through it. If tensions in the region were to escalate, this narrow passage could be strangled by China’s rivals, affecting Beijing’s energy security, a possibility that former Chinese President Hu Jintao branded the “Malacca Dilemma”. In order to reduce its dependence on the Strait, today China is searching for new land routes for its energy imports, especially through its Belt and Road Initiative. To achieve this, Beijing has turned to ASEAN countries, planning huge investments in Southeast Asian infrastructure. Myanmar, for example, will host the China-Myanmar Economic Corridor (CMEC), a section of the Belt and Road Initiative that is intended to connect the oil trade from the Indian Ocean to China via Myanmar, thus reducing Chinese dependence on the Strait of Malacca.

“Don’t force us to choose”, ASEAN countries have repeatedly asked. Unfortunately, as US-China tensions flare up time and again, neutrality doesn’t seem a viable option. The bloc seems to follow an ambivalent policy. Some of the 10 member states, like Cambodia, Laos, and the Philippines, opted to stay in the Chinese orbit, hungry for economic gains. Others, like Vietnam and Singapore, appear more interested in Western protection against a rising China, and tend to align with Washington. Although these positions are likely to shift over time, the only certainty is that ASEAN is now trapped in the middle of a power struggle. However, there might be a way for Southeast Asian countries to escape the trap. ASEAN nations could choose to collaborate with middle powers such as Australia and Japan, thus creating middle-power agency and reducing the need of a binary choice between the US and China. They could therefore keep their security ties with the US, while at the same time maintaining their economic relations with China.

ASEAN originally emerged as a response to the tensions of the Cold War, when a confrontation between capitalism and communism could threaten the balance of the newly independent states of Southeast Asia. Quite ironically, today the ASEAN region, and the South China Sea in particular, are again becoming a proxy for great power competition. This could split ASEAN countries along different ideological lines once again, just as happened during the first Cold War. Trapped in the power struggle of the 21st century, they now find themselves walking a tightrope. Unlike the Golden Decade, the Diamond decade seems to be one of uncertainty, where the union between China and ASEAN nations is increasingly vulnerable to the forces of geopolitics.

Challenges to the Rule of Law in Times of Crisis Series: America strikes again - Thoughts on Biden’s first military airstrike in Syria

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A U.S. Air Force B-1B Lancer flies over northern Iraq after conducting air strikes in Syria against ISIL targets. Photo Credit: US Department of Defense, Public Domain.

This article is part of our series on Challenges to the Rule of Law in Times of Crisis. Read the series introduction at this link.

America is back in business, and a significant part of its stock in trade is the use of military force. Syria knows as much after being hit by two consecutive administrations in the past four years. Whatever differences Donald Trump and Joe Biden may have in style, demeanour, rhetoric, and politics, when it comes to the use of force their international record so far looks very similar.

Although the US is not formally engaged in an international armed conflict with the state of Syria, over the last years it has deployed military personnel on Syrian territory to stave off the threat of ISIS, and reportedly also to provide a geopolitical counterweight against Russian presence in the region. Moreover, the US has carried out military airstrikes on Syrian territory, most notably in 2017, again in 2018 alongside European allies, and recently on 25 February 2021. Ironically, Trump’s strikes against the Syrian government in 2017 and 2018 were prompted by an ostensible humanitarian rhetoric that is absent in Biden’s justification for his recent decision to strike Iran-backed non-governmental militias operating in Syria.

Indeed, among other grounds such as self-defence and an alleged mandate by the international community, four years ago Trump famously invoked humanitarian concerns in light of the shock produced by the Syrian government’s use of chemical weapons against its own population. Conversely, no chemical weapons were involved this time, and Biden steered clear of such humanitarian rhetoric and stuck to the traditional right of self-defence under the UN Charter to address attacks against US and its allies in Iraq.

This recent strike has been met with immediate condemnation by international law experts, mainly on the grounds that the right of self-defence must be exercised – always in a necessary and proportionate manner – against an armed attack that has occurred, or that is imminent. Since Biden’s strike was carried out ten days after the events motivating it, this US extraterritorial response seems to be too late to qualify as self-defence against an ongoing or imminent threat. Rather, it has been decried as an act of armed reprisal, which is illegal under international law.

Many questions remain to be answered or at least discussed from an international law perspective, bearing on the proverbial who, when and what. These include the legality of the use of force by one single state with no mandate in lieu of the collective security system represented by the UN Security Council; the deterrence of future threats instead of responding to current or past attacks; and the possibility of considering a series of discrete but coherent actions, in this case by non-governmental actors, as a single armed attack under the ‘accumulation of events’ doctrine.

Alongside international law, legal experts have also reflected on the justification for this recent attack under US domestic law, especially considering that this time the battered Authorization for the Use of Military Force or ‘AUMF’ – passed by the US Congress in 2002, its use spanning over two decades of strikes against Iraq, ISIS, and Iranian official Qasem Soleimani – was left on the shelf. Instead, Biden claimed to have direct authority under the US Constitution to conduct the attack.

Thus, the picture legal experts have painted when analysing Biden’s debutant strike is one of plausible justification under domestic law, and of highly dubious lawfulness under international law.

But even if all lawyers agreed that the attack was illegal under both domestic and international law, is the legal rationale the only one we need to take into account to assess Biden’s first use of military force? Is there something else we might say from a moral perspective? Even notorious legal positivists admit there is always room for moral scrutiny beyond the law. This becomes particularly relevant when legal discourse is quickly exhausted, as it is often the case with the scant provisions of international law bearing on the use of force. What will we do when we label an act as illegal, and yet global powers continue to commit it? Will we surrender to the cynicism of realpolitik, or will we fall back to a broader normative language to keep our moral judgments on the ball?

In the case of the use of force between nations, the articulation of such moral enquiries has taken over the centuries the form of the ‘Just War’ tradition, which unfolds into two separate lines of inquiry: when is it justified to resort to armed force (jus ad bellum)? And, what is permitted and prohibited in the conduction of hostilities once the war has begun (jus in bello)? In recent years the discussion has branched out into new avenues, including jus post bellum and jus ad vim (from the Latin vim or ‘force’). The latter was first suggested by Michael Walzer in the preface to the 2006 fourth edition of his canonical Just and Unjust Wars. Reflecting on the controversial invasion of Iraq a few years before, Walzer wrote:

“the Iraqi case invites us to think about the use of force-short-of-war; the containment regime of 1991-2003 that the UN endorsed and the United States enforced is only one possible example of this use. (…) force-short-of-war obviously comes before war itself. The argument about jus ad bellum needs to be extended, therefore, to jus ad vim. We urgently need a theory of just and unjust uses of force. This shouldn’t be an overly tolerant or permissive theory, but it will certainly be more permissive than the theory of just and unjust war.” (p. xv)

And we may add, certainly more permissive than international law, which clearly prohibits any ‘use of force’ by states under article 2(4) of the UN Charter, with very few exceptions (i.e. self-defence and Security Council authorization). But as we saw, the law is not the only framework to analyse instances of the use of force, and some scholars have taken up Walzer’s challenge, laying the groundwork for a new theory of jus ad vim. Among such theorists we find Daniel Brunstetter and Megan Braun, who in 2013 published their influential article titled “From Jus ad Bellum to Jus ad Vim: Recalibrating Our Understanding of the Moral Use of Force.”

According to these authors under jus ad vim a just cause for using force is aggression, whether by states or non-state actors, warranting recourse to the right of self-defence. The use of force must be also proportional, a last resort, authorized by a legitimate authority, and carried out with the right intent (all traditional jus ad bellum criteria). The thrust of their argument is that the use of force must always reduce the probability of escalation. In other words, vim resulting in bellum evidences a failure in the application of the characteristically de-escalatory rationale underlying jus ad vim. As to international law, Brunstetter and Braun argue that jus ad vim should ideally be anchored in that normative regime, but if international law proves to be too narrow to respond to the needs of states, then it will have to evolve through customary law to mirror the evolution of our shared ethical judgments.

Based on the foregoing, can we say that the recent US airstrike in Syria satisfies jus ad vim? There might be some room to argue that US forces and allies were attacked in Iraq and, therefore, that the use of force-short-of-war in self-defence was warranted. And even if we were extremely generous as to concede that the other criteria of last resort, legitimate authority, and right intent were met, a considerable problem from the perspective of jus ad vim remains: however localized and discriminate, such attacks risked escalating hostilities in an already hot and unstable environment. And considering the heavy involvement of Russia in the Syrian quandary, the risk of escalation of the armed conflict to turn into a Cold War-style proxy war between the US (and its allies) and Russia (and its allies) must be an ever-present consideration in every policy decision made by the US, regardless of who sits in the Oval Office.

America is back in business, but for many it just feels like business as usual. Yet, this does not mean that the use of force can continue simply unchecked or that we should surrender to pure realism, for there is a full normative framework in place to assess the legality and morality of such acts under the principles of international law, jus ad bellum and jus ad vim. By using the legal view as a departure point for further moral discussion, the interplay between all these standards offers the potential to strengthen our convictions and hone our judgments about the use of force and war.

U.S. governmental incentives on semiconductors are central to Great Power Competition

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Photo by Laura Ockel on Unsplash

Microchips, also called semiconductors or integrated circuits, can be thinner than a human hair and smaller than a postage stamp, but their power can be immeasurable. They play a significant role in the advancement of the consumer technologies sector and, most importantly, in the development of more sophisticated branches of technology with potentially significant implications for national security, such as Artificial Intelligence (AI) and quantum computing. Therefore, although domestic and foreign policy might not always be connected, in the case of the U.S. semiconductor industry, domestic decisions are vital both for U.S. national security and for the evolution of great power relations in general, and U.S.-China relations in particular.

The largest chipmaker in China, the Semiconductor Manufacturing International Corporation (SMIC), was added to the U.S. Entity List by the Trump administration in late December 2020 as a final move of the toughest measures taken towards Beijing, fearful that the Biden administration would soften the policy towards China. Biden, however, has not only dismantled such tough decision on the technology front, but his administration is also working on domestic measures around the semiconductor industry that will be central to U.S.-China technological competition.

In September 2020, the National Defense Authorization Act for Fiscal Year 2021 (NDAA) came into law, authorising investments in both domestic chips manufacturing incentives and in advanced microelectronics research and development. Soon after Biden took office, the Semiconductor Industry Association (SIA) followed up by stressing the need for the new U.S. administration to prioritise funding to such provisions. This came in light of the sharp decline in the U.S. share of the global chip manufacturing, which can affect the U.S. ability to produce newly advanced technologies vital to strengthen both U.S. military capabilities and its great power status overall. In fact, although the United States is the currently the global leader in semiconductors, owning around 47% of the global chips market share, U.S. chips manufacturing has been decreasing, and this might affect the American leadership in the sector already in the medium run. According to SIA, while in 1990 the United States accounted for the 37% of the global chip manufacturing, in 2020 this share has fallen to 12%. By contrast, China’s share has increased from 2% to 15% between 1990 and 2020, and it is expected to grow up to 24% in 2030, surpassing both South Korea, Taiwan, and Japan. In the same period, the American allotment in global chip manufacturing is expected to decline to 9% if governmental intervention will not be put in place.

This shift is the result of both lower incentives for the U.S. semiconductor sector and tougher measures towards China undertaken under Trump. The Covid-19 pandemic has further aggravated the situation, eventually bringing chips under the spotlight in U.S. government. The high increase in demand for consumer technologies – mainly laptops and smartphones – during the pandemic has led to a critical chips supply shortage in the U.S., leading Biden to sign an executive order that received bipartisan support in Congress in late February. The order authorised the use of $37 billion to foster the American manufacturing of semiconductors, and has furthermore launched a 100-day review on the status of supply chains in four areas that are essential to American competitiveness: semiconductors; key minerals and materials extracted from rare earths; pharmaceuticals; and advanced batteries. The order was signed the day after U.S. Senate Majority Leader Chuck Schumer declared to have directed lawmakers to draft a package of an additional $100 billion as part of a bipartisan bill to implement the NDAA by fostering research and investment in U.S. manufacturing in key high tech areas – not only semiconductors but also Artificial Intelligence and quantum computing - in order “to out-compete China and create new American jobs”.

The crucial passage to rebalance the geopolitics of semiconductors and strengthen American technological competitiveness face to China, thus, lies in American domestic politics. The review launched with Biden’s signature of the executive order is aimed at diversifying and fortifying supply chains, and the SIA insisted particularly upon increasing American chips manufacturing through the mobilisation of federal incentives. About 44% of U.S.- headquartered firms are located in the United States, but the cost to build and operate a front-end fabrication facility (fab) in the U.S. is 25% - 50% more expensive than in other alternative locations. Singapore, for instance, which hosts the majority of U.S. chips fabs based abroad (17%), has introduced hiring credits and a reduced tax rate in the semiconductors manufacturing sector, while American incentives of this kind are almost non-existent. For this reason, the measures announced by Biden and Congress play a very important role in increasing U.S.-made chips and thus fortifying American leadership in the sector by avoiding a shortfall of the U.S. share in the global chip manufacturing at a time when China’s will surely increase as a result of the plan to reach the self-sufficiency in semiconductors outlined in China’s 14th Five Year Plan.

This turn in the American semiconductor policy, however, should not be analysed through a ‘new Cold War’ lens, as China is not only the biggest U.S. competitor in chips manufacturing, but it is also a top costumer of the U.S. semiconductor industry. According to a report from the Boston Consulting Group, prohibiting U.S. chips sales to China could cause the loss of around $80 billion to the U.S. semiconductor industry, compromising the U.S. long-standing leadership position with a loss of about 18% in the American global market share of microchips. For the U.S., the solution to face the challenges posed by China on the high-tech side is found not only in a tougher policy towards Beijing, but in the U.S. semiconductor policy, which will in turn have important side effects on U.S.-China policy. As the Biden administration is likely to adopt a tough but multilateral approach to China – not only on technology but also on a variety of transnational challenges – the oculate application of the resources recently announced by the U.S. government on chips manufacturing can be pivotal both to the maintenance of the U.S. power status and to the re-definition of great power competition.

U.S. Energy, Placing Strategy ahead of Policy

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Conceptual photo of energy sources. Source: LovetoKnow

U.S. Energy Production – Politics vs. Strategy

U.S. energy policy is U.S. energy politics. The fight for energy-producing states this election season demonstrated this feature. President Trump made a calculated all-out blitz for these politically essential states in 2016 and 2020 by targeting his messaging of unrestricted energy production policies to critical constituents. [i] The Democrat Party, always in a more precarious political position due to a broader base, attempted to thread the needle, moving between abruptly ending the fossil fuel industry and gently progressing away. Finally, deciding on $2T in spending as a middle ground between its constituents.

This phenomenon deviates from U.S. energy policy’s historical role, where political leadership from both parties would equate energy policy with national security. President Nixon declared an emergency after the oil embargo and increased domestic production programmes. President Carter looked to secure supplies by removing pricing controls, establishing a strategic reserve, and initiated the U.S. military’s force increase in the Gulf region.[ii] The first war in Iraq was partially justified as preventing Saddam Hussein from controlling an even greater share of the global oil supply. Similarly, the reactivation of the fifth fleet and regional basing and partnerships stem from these strategic calculations. Even as recently as President Obama, achieving energy independence from international vagaries was a central talking point of his clean and renewable energy policies. Despite different political bases and inherent beliefs, each approached energy policy from the point of strategic national benefit.

Overton Window

When tackling climate change, America would be wise not to put policy goals before a strategic approach, as demonstrated in the U.S. removal of Saddam Hussain. Here, a rush to achieve a “safer world” through removing several threats and the spread of democracy, all in one swift policy, demonstrates that having a policy goal of global change without a feasible and sustainable strategy to reach that goal can invite catastrophe.

Fortunately, the U.S. energy-producing states’ current importance to any presidential bid, the 50/50 divided in domestic politics, and a split congress offer the opportunity to implement an energy strategy over an energy policy. This is due to the current political conditions preventing either side from implementing a strictly partisan policy. Furthermore, the diverse options under any multifaceted and long-term strategy allow political actors from all sides to claim a moral victory and deliver results to their constituents.

Strategic Dilemma

Climate change is real. Unfortunately, so is Chinese and Russian aggression. The kernel of this strategic dilemma is that most U.S. steps to reduce carbon use also reduces U.S. and global security. While climate change will continue to impose itself on the word with strategic repercussions, so will Russia and China. China’s ability to use threats about trade to compel the E.U. in times of stress was successful, as the E.U. backed down in its reporting on China’s response to COVID. China also produced similar threats to cut off medical and pharmaceutical supplies to the U.S. Furthermore, their use of salami tactics to control trade routes, energy sources, and commercial fishing in national territory and control pieces of Europe will continue independent of climate change.

Decarbonization will be costly to the U.S. Every effort to impose restrictions will decrease the strategic risk of climate change but will increase the strategic risk imposed by China and Russia due to reduced U.S. economic capacity, global economic influence, energy independence, and reduce the energy independence of its allies and partners. There is also no guarantee that enduring these costs will achieve the objectives of ending or significantly reducing global warming due to China’s continual expansion of coal power plants and occupation of oil and gas fields in the South China Sea for potential exploitation. Furthermore, projected growth across India and Asia could additionally counter any feasible reductions in the U.S.

Strategic Opportunities

Advantages of the Status Quo: In 2019, the U.S. attained a greater degree of energy independence as it transitioned from being a net importer to a net exporter of crude and refined petroleum products. This accomplishment provides an economic advantage in revenue derived through market share, integration of world-class U.S. corporations into economies around the world, sustains a robust and dynamic economy that absorbs millions of immigrants and develops everything from the P.C. to one of the first the COVID-19 vaccine, and fuels a military that maintains global security. It also provides a hedge in the event of a great power or sustained conflict. Similarly, U.S. production capacity secures European economies and militaries as it allows for an alternative to global supply chains and dependence on Russia’s energy exports.[iii] Since oil and gas trade in USD, current arrangements help solidify the USD’s strategic advantage as the reserve currency and global finance provider. This latter fact is beneficial for countering an economically ambitious China attempting to ensnare smaller countries, as revealed in Sri Lanka’s loss of Hambantota Port, by creating new trade routes and an alternate reserve currency and financing opportunities.

Advantages of Opportunity: While the U.S. does maintain a current strategic advantage in the extraction-based world, this does not mean that a future of transition is devoid of similar strategic opportunities. The U.S. possesses several inherent strategic advantages, which it can lever in the quest to develop an answer to these problems. These include its capacity for research and development through its universities, defence and federal government initiatives, and iconic inventors in their garages. It also includes its business culture, cutting edge firm practices, entrepreneurship, and its flexible and dynamic investing ecosystem. Therefore, any path towards decarbonization can maintain some of the current advantages if it applies these strengths.

Strategic Pillars

Treat Decarbonization like Disarmament: To prevent a strategic nadir, the U.S. can treat decarbonization like disarmament. Agreements such as the Paris Climate Accords, on their own, will only hurt compliers while increasing relative gains of countries savvy or cynical enough to join and evade or ignore commitments. While Xi Jinping was producing statement after statement about reducing greenhouse emissions, his party brought more new coal plants into existence, nationally and internationally, than the accords can potentially overcome. Alternately, as U.S. efforts to decarbonize increase consumers’ and exporters’ costs, reduce U.S. multinational firms’ capacity, and reduce core industrial capability and small businesses vitality, America’s rivals continue to decrease energy production and consumption costs.

Therefore, as the Biden administration starts to adjust the Trump trade war, realigns relations with China, and builds U.S. manufacturing and the post-COVID economy, an opportunity exists to create agreements that can balance these concerns and embed reciprocal actions over blanket U.S. reductions.

Secure Supply Lines: Long-term movement away from carbon dependence requires a move towards reliance on rare earth elements. While the federal government has taken steps to increase its reserves of these elements, no efforts exist to secure continued supply, especially in a national emergency or sustained conflict. The fact that Russia and China together can possess or control up to 90% of global supply, depending on the specific element, adds another security challenge that requires a solution before relying on renewables.

Fortunately, the potential for new exploration exists in the U.S., Australia, Africa, and Latin America. Similarly, other Asian countries besides China can provide a low-cost option in making these materials usable. Malaysia being one, where China’s attempt to dominate its port facilities and transportation infrastructure demonstrates the need to secure these chains. Ambitious exploration and exploitation can reduce the costs of extraction and open new supplies. Part of securing this access, against China’s attempts, could include setting up ventures between U.S. and host nation companies to address the exploration, mining, extraction, and transportation required to bring these items to market while keeping the process partly in U.S. hands. As any return on investment would be long-term and risky, the U.S. Government would need to play a role in funding, guaranteeing profits, and technology exchange. This model could also deliver structured and spill-over entrepreneurial, technology, and educational benefits to local businesses and populations through additional loans, infrastructure development, educational opportunities, and access to both global and U.S. markets and companies. It could provide a local and grassroots development model and an alternate approach to China’s state-centered and state empowering One Belt One Road initiative. [iv]

Develop Comparative Advantages at Home: Within the U.S., opportunities exist that play to America’s strength and ensure that decarbonization supports U.S. economic advancement. As renewables and batteries depend on a significant amount of rare earth elements and minerals, the government can use U.S. universities to start programs that will create technology that can extract minerals with cheaper methods. The government can also promote STEM education in these fields through subsiding education. The importance of the production of these components to national security provides an opportunity to bring advanced manufacturing back to the U.S. Although, achieving this remains complicated as production in the U.S. is more expensive than in Asia. Still, the government should examine expenses, including the cost of not controlling production, including diplomatic and military, associated with securing overseas supplies and use them in a calculation on onshoring.[v]

Conclusion

In the U.S., the election cycle, which seemingly is an almost continuous street brawl these days, limits politicians’ ability to implement longer-term and incremental solutions. Instead, they must execute the immediate option to meet their short-term political demands. Although, as the President and Congress wade through a divided government and country, the opportunity exists to trade short-term paralysis for a long-term strategy and implement a far-sighted approach to battling climate change.

[i] Guliyev, Farid. “Trump’s ‘America first’ energy policy, contingency and the reconfiguration of the global energy order.” Energy Policy, vol. 140, May 2020.

[ii] Painter, David. “Oil and Geopolitics: The Oil Crisis of the 1970s and the Cold War.” Historical and Social Research, vol. 39, no. 4, 2014.

[iii] Henderson J., Mitrova T. (2020) Implications of the Global Energy Transition on Russia. In: Hafner M., Tagliapietra S. (eds) The Geopolitics of the Global Energy Transition. Lecture Notes in Energy, vol 73. Springer, Cham. https://doi.org/10.1007/978-3-030-39066-2_5.

[iv] According to ideas proposed during conversations between Benjamin Flosi, Christopher Tynan, and John Huntsman (https://securitystudies.org/) from September-November 2020.

[v] According to ideas proposed during conversations between Benjamin Flosi, Christopher Tynan, and John Huntsman (https://securitystudies.org/)from September-November 2020.

Benjamin Flosi is a first year Ph.D. student at King’s College London and a Copy Editor at Strife.