Because of a bureaucratic quirk dating back to 1789, the United States’ international economic and security policies continue to be debated in distinct spheres. The Department of State is responsible for the former, and the Pentagon for the latter. This tangible division in specialties and interest continues among policymakers despite increasing evidence that some of today’s most pressing foreign policy issues take place at the nexus of security and economy. Of course, facing a national security threat is a priority over forming economic policy, but in many modern cases national security issues arise only because economic issues were ignored for too long. Thus, security and economy should not be considered in distinct policy realms--as snapshots of a challenge at a precise moment. Rather, they should be considered as elements of the same foreign policy challenge, linked and variably influential over time.
It is easier to imagine the job of a firefighter than a fire preventer. A firefighter identifies and extinguishes fires. A fire preventer’s job is more nebulous. Does he focus on shoddy wiring? Excessive leaf litter in forests? Or persons suspected of arson intent? Firefighting is important and necessary, but it would be best to have no fires to begin with. Yet visceral, gut feelings tell us to fund the firefighter and laud his accomplishments, and question what fire prevention truly accomplishes. In foreign policy, the defense department is the firefighter. Economic policy is the fire preventer.
One example of the security risks of poor economic policy can be seen in the Central African Republic (CAR). The World Bank placed the CAR last among all countries in its "Doing Business" survey this year, a decline from third-to-last in 2012; transparency International ranks the country 144th out of 174 countries on its corruption perceptions index; and Gallup has cited the CAR as having one of the worst payroll to population percentages in the world.
That this economic malaise caused regional instability is evident. A key demand of rebels in all four ceasefires signed over the past six years was salaried employment. Each time hostilities resumed, rebels cited that paid jobs had not been provided as promised. This rebellion was driven by economic grievances, and it culminated in a coup on March 24th that had further implications for insecurity. The multilateral manhunt for Joseph Kony and his Lord’s Resistance Army (LRA)–a hunt in which 100 U.S. forces participate–was suspended. The regional population’s fears of abduction increased. Nearly 40,000 refugees crossed borders and strained infrastructure, social services, and governance in neighboring states. Though the deposed CAR government was no expert in combating regional security threats in cooperation with its neighbors, it is clear this task will be even more difficult for the band of rebels now freshly learning to harness the reigns of governance.
Sadly, this is a reinforcing trend. The Economist Intelligence Unit recently stated that CAR’s political instability is undermining its economy, citing the blocked transportation networks, the rise of food prices by 40 percent, and the resultant food shortages and inflation. A lack of jobs led to the rebellion, and the resulting insecurity hurt job growth.
Throughout the CAR’s troubles, the United States’ most notable economic response was to suspend eligibility for preferential market access under the African Growth and Opportunity Act (AGOA) as punishment for the 2003 coup. This step cut the CAR’s exports to the United States by half–hardly an action likely to improve the economy or regional stability.
Guinea-Bissau is another example of a country where a poor economic situation has given way to one where regional security may be threatened. Like the CAR, Guinea-Bissau is no stranger to coups, having experienced two successful ones and several more attempts over the past decade. Yet the most recent October 2012 coup has consolidated Guinea-Bissau’s reputation as a narco-state. On April 2nd, a high-ranking Bissauan admiral was arrested for trafficking over one ton of South American cocaine destined for Europe. A U.S. State Department official said the admiral was “desperate for money [and] someone offered him a deal with that kind of payoff.” This reflects well the behavior of many more Bissauan officials, and it is now feared that the government acts in concert with dangerous organized crime syndicates from around the world. Such activity has prompted the U.S. government to expand its drug war in West Africa by $100 million, adding two additional DEA offices to the five already placed there. Though it is not certain, it seems likely that providing greater economic opportunity within Guinea-Bissau’s legitimate economy may have prevented this from occurring.
The costs of ignoring international economic policy opportunities and resorting to reactive defense measures are larger than one might think. The Washington Post has reported that over $1 billion has been spent on counterterrorism in North and West Africa since 2005. With the construction of a new drone base in Niger (and Predator drones costing $20 million each) this figure will likely rise. In stark contrast, the ONE Campaign has reported that AGOA, the primary vehicle for U.S. economic engagement with Africa, costs the U.S. taxpayer $2 million per year in non-oil tariffs and has created 300,000 African jobs. This figure is three-quarters of the CAR’s estimated 400,000 unemployed persons. If such cheap economic policies could gainfully employ hundreds of thousands of people who might otherwise seek illicit paths toward success, it seems possible that rebellions would ease, the incident of coups would lessen, insecurity would decline, and peace and productivity might grow. Moreover, the costs incurred by economic policy efforts often pay dividends by opening markets to U.S. businesses and expanding U.S. export potential and consumer import savings. The costs of military action sometimes pay dividends by leaving behind weapons, unemployed soldiers, and bitterness.
The Central African Republic and Guinea-Bissau have caught fire. The U.S. has not yet sent firefighters, as it quietly has in Mail, Somalia, and elsewhere on the continent, but it still may. The CAR’s planned transition to democracy leaves open the opportunity for an insurgency, failed state, or ungoverned area to emerge. The LRA may begin another rampage; militants from Chad, South Sudan, or Somalia may form a dangerous enclave. The strain of refugees may have significant spillover effects. Cooperation among the Bissauan state and Colombian cartels may grow in ways deemed unacceptable by the United States or international community. These fires may fade out, may slowly burn without concerning distant states, or they may grow quite large and demand firefighting.
Moving forward, robust economic policy engagement could obviate the need for some of the significant military expenses that result from general global insecurity. It could also alleviate the expense of intelligence activities that are surely already monitoring such areas. Economists and security specialists should recognize that they are fighting the same challenge, and allocate their resources and skills to both prevent foreign policy fires from starting and to combat them when they arise. Currently, the pendulum needs to swing more toward economic engagement and fire prevention.
Michael D. Rettig works for the Africa Growth Initiative at the Brookings Institution. His experience with national security and foreign policy includes time spent at the State Department’s Bureau of African Affairs, National Defense University’s Africa Center for Strategic Studies, and the Council on Foreign Relations’ corporate program. The views presented here are his own.
Photo: Matteo Angelino (cc).
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Ignoring Economy at the Expense of Security
April 30, 2013
Because of a bureaucratic quirk dating back to 1789, the United States’ international economic and security policies continue to be debated in distinct spheres. The Department of State is responsible for the former, and the Pentagon for the latter. This tangible division in specialties and interest continues among policymakers despite increasing evidence that some of today’s most pressing foreign policy issues take place at the nexus of security and economy. Of course, facing a national security threat is a priority over forming economic policy, but in many modern cases national security issues arise only because economic issues were ignored for too long. Thus, security and economy should not be considered in distinct policy realms--as snapshots of a challenge at a precise moment. Rather, they should be considered as elements of the same foreign policy challenge, linked and variably influential over time.
It is easier to imagine the job of a firefighter than a fire preventer. A firefighter identifies and extinguishes fires. A fire preventer’s job is more nebulous. Does he focus on shoddy wiring? Excessive leaf litter in forests? Or persons suspected of arson intent? Firefighting is important and necessary, but it would be best to have no fires to begin with. Yet visceral, gut feelings tell us to fund the firefighter and laud his accomplishments, and question what fire prevention truly accomplishes. In foreign policy, the defense department is the firefighter. Economic policy is the fire preventer.
One example of the security risks of poor economic policy can be seen in the Central African Republic (CAR). The World Bank placed the CAR last among all countries in its "Doing Business" survey this year, a decline from third-to-last in 2012; transparency International ranks the country 144th out of 174 countries on its corruption perceptions index; and Gallup has cited the CAR as having one of the worst payroll to population percentages in the world.
That this economic malaise caused regional instability is evident. A key demand of rebels in all four ceasefires signed over the past six years was salaried employment. Each time hostilities resumed, rebels cited that paid jobs had not been provided as promised. This rebellion was driven by economic grievances, and it culminated in a coup on March 24th that had further implications for insecurity. The multilateral manhunt for Joseph Kony and his Lord’s Resistance Army (LRA)–a hunt in which 100 U.S. forces participate–was suspended. The regional population’s fears of abduction increased. Nearly 40,000 refugees crossed borders and strained infrastructure, social services, and governance in neighboring states. Though the deposed CAR government was no expert in combating regional security threats in cooperation with its neighbors, it is clear this task will be even more difficult for the band of rebels now freshly learning to harness the reigns of governance.
Sadly, this is a reinforcing trend. The Economist Intelligence Unit recently stated that CAR’s political instability is undermining its economy, citing the blocked transportation networks, the rise of food prices by 40 percent, and the resultant food shortages and inflation. A lack of jobs led to the rebellion, and the resulting insecurity hurt job growth.
Throughout the CAR’s troubles, the United States’ most notable economic response was to suspend eligibility for preferential market access under the African Growth and Opportunity Act (AGOA) as punishment for the 2003 coup. This step cut the CAR’s exports to the United States by half–hardly an action likely to improve the economy or regional stability.
Guinea-Bissau is another example of a country where a poor economic situation has given way to one where regional security may be threatened. Like the CAR, Guinea-Bissau is no stranger to coups, having experienced two successful ones and several more attempts over the past decade. Yet the most recent October 2012 coup has consolidated Guinea-Bissau’s reputation as a narco-state. On April 2nd, a high-ranking Bissauan admiral was arrested for trafficking over one ton of South American cocaine destined for Europe. A U.S. State Department official said the admiral was “desperate for money [and] someone offered him a deal with that kind of payoff.” This reflects well the behavior of many more Bissauan officials, and it is now feared that the government acts in concert with dangerous organized crime syndicates from around the world. Such activity has prompted the U.S. government to expand its drug war in West Africa by $100 million, adding two additional DEA offices to the five already placed there. Though it is not certain, it seems likely that providing greater economic opportunity within Guinea-Bissau’s legitimate economy may have prevented this from occurring.
The costs of ignoring international economic policy opportunities and resorting to reactive defense measures are larger than one might think. The Washington Post has reported that over $1 billion has been spent on counterterrorism in North and West Africa since 2005. With the construction of a new drone base in Niger (and Predator drones costing $20 million each) this figure will likely rise. In stark contrast, the ONE Campaign has reported that AGOA, the primary vehicle for U.S. economic engagement with Africa, costs the U.S. taxpayer $2 million per year in non-oil tariffs and has created 300,000 African jobs. This figure is three-quarters of the CAR’s estimated 400,000 unemployed persons. If such cheap economic policies could gainfully employ hundreds of thousands of people who might otherwise seek illicit paths toward success, it seems possible that rebellions would ease, the incident of coups would lessen, insecurity would decline, and peace and productivity might grow. Moreover, the costs incurred by economic policy efforts often pay dividends by opening markets to U.S. businesses and expanding U.S. export potential and consumer import savings. The costs of military action sometimes pay dividends by leaving behind weapons, unemployed soldiers, and bitterness.
The Central African Republic and Guinea-Bissau have caught fire. The U.S. has not yet sent firefighters, as it quietly has in Mail, Somalia, and elsewhere on the continent, but it still may. The CAR’s planned transition to democracy leaves open the opportunity for an insurgency, failed state, or ungoverned area to emerge. The LRA may begin another rampage; militants from Chad, South Sudan, or Somalia may form a dangerous enclave. The strain of refugees may have significant spillover effects. Cooperation among the Bissauan state and Colombian cartels may grow in ways deemed unacceptable by the United States or international community. These fires may fade out, may slowly burn without concerning distant states, or they may grow quite large and demand firefighting.
Moving forward, robust economic policy engagement could obviate the need for some of the significant military expenses that result from general global insecurity. It could also alleviate the expense of intelligence activities that are surely already monitoring such areas. Economists and security specialists should recognize that they are fighting the same challenge, and allocate their resources and skills to both prevent foreign policy fires from starting and to combat them when they arise. Currently, the pendulum needs to swing more toward economic engagement and fire prevention.
Michael D. Rettig works for the Africa Growth Initiative at the Brookings Institution. His experience with national security and foreign policy includes time spent at the State Department’s Bureau of African Affairs, National Defense University’s Africa Center for Strategic Studies, and the Council on Foreign Relations’ corporate program. The views presented here are his own.
Photo: Matteo Angelino (cc).
