Friday, January 4, 2019

How do you Stop the Arms Race? By Starting a New War, for Instance



Do you see a ghostly Seneca Cliff in this graph? (source)


There is a good rule that you should always be careful when extrapolating your data, especially over the long term. And there is an even better rule saying that you should never, never extrapolate an exponential growth. The uncertainty in the data of an exponentially growing curve increases exponentially, too, and that makes your extrapolation meaningless very soon.

But, in the figure above, they extrapolated an exponentially growing curve for the military expenses of the US and China over more than 30 years!  The origin of that curve above seems to be the RAND Corporation. I couldn't find the original source, but it has been reproduced in the blog of the Wall Street Journal and on Zero Hedge

It looks like someone seriously proposed this extrapolation. But consider a few numbers: according to the chart, by 2050 the US would spend more than 20% of its present GdP for the military! (it is now about 3%). It might be possible if the US GdP were to increase in proportion. But, from the graph, they assume a growth of nearly a factor of 5 (from ca. 600 billion dollars, today, to 2.9 trillion in little more than 30 years. It means that the GdP should double at least twice in 30 years, that is, the US economy should grow at the rate of 6% (twice the current rate!) every year for the next 30 years. Otherwise, the US government would bankrupt itself even faster than it is doing now. 

Now, you might want to dismiss this graph as one of the many silly forecasts that are part of the everyday chat on how this or that sector of the economy is going to grow -- and therefore everyone should invest on it. But, there is something in this idea that military expenses are going to rise in the future. It has to do with a typical enhancing feedback effect. One side raises its military expenses and causes the other side to do the same. And that's the feedback that creates a ladder on which both contenders climb without knowing how to step down. Another parallel effect is the financial mechanism. Large investments in military expenses create a powerful lobby representing the military-industrial complex. A powerful lobby successfully pushes for higher investments and that, in turn, creates an even more powerful lobby. It is all part of what we call "arms race."

Here is another example of an arms race: how military expenses grew in the years before the 1st World War. (from Our World in Data -- see also this link)


The impression is that, by 1913, nobody knew how to stop the race and that the only "solution" that could be found to block the ever-increasing costs was to start a war -- which they did.

The similarity of the current situation with that of the years leading to WWI has been noted more than once. So, are we going to see a new world war in the near future? We cannot say: history doesn't really repeat itself, although it does rhyme. It might not be necessary to start a new world war to stop the exponential growth of military expenses, but the data are not encouraging. A new war could really be near. And, a nuclear war could generate a Seneca Collapse so drastic and disastrous that it could really be the "war ending all wars" -- as WWI should have been -- at least those not fought with clubs and stone axes only.





3 comments:

  1. Nice post, well I don't have much to comment, I think you are right.

    At least one regional war in Mediterranean area is getting closer: I suppose it will detonate somewhere from 2030s until 2050s.

    The bad news: there's no time for fixing the reasons of war in Mediterranean area before 2050s.
    The good news: there's still time for fixing the reasons of war in Asia before 2050s.

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  3. While it may be true that war as a recurring phenomena through history cannot be pinned down to any monocausal theory that would allow a straightforward response - nevertheless any particular war, and any specific situation involving a danger of war, can perhaps be analysed as a unique situation - including if there are features that rhyme with the past.

    So what is the current situation specifically?

    Clearly we have a declining superpower which has a massive military industrial and media complex to act as a vested interest for war that wants to grow - but in the context of the limits to economic growth where all states, and particularly the superpower, are on the verge of serious economic decline or even collapse. Dangers of war in this context arise from an elite that has a powerful interest in scapegoating other nations. It faces problems its elite does not properly understand and the simplest explanation of every problem to share with the masses is that all problems are the result of "the enemy" (Russia/China) - plus there is a powerful interest in trying to grab the resources the elite does not have or fears losing...particularly energy resources...

    On the other hand....and we should surely always seek to find other ways of seeing things and other processes - on the other hand the economic difficulties and the depletion of strategic resources is undermining the ability to continue an arms race in ways that we cannot, as yet, fully foresee. You write, Ugo, about prior to WW1 - but the age of coal was still reaching its peak in Britain and there were plenty of energy resources to fuel industrialisation in other countries. The age of oil had barely begun. Indeed the war saw the transition from coal powered warships to oil powered ones.

    Another approach is to ask - how is it that peace sometimes unexpectedly occurs? Are there occasions where arms races or incipient conflict does not lead to war? In the Soviet Union before Glasnost and Perestroika there was a politically powerful military industrial complex too. Many places in Russia were invested in a war economy and arms race. It was therefore politically impossible to shift resources from war production to peace time production in the 1980s for example. This was a huge burden on the Soviet economy and with a disastrous agricultural system and shoddy industrial goods there was heavy dependence on importing grain, paid for by exporting oil and gas. Then this oil and gas industry got into problems with oil prices too low to pay for the grain. That brought about the collapse....which, for a time, eased tensions with NATO (until they learned that the western military industrial complex cannot be trusted to keep its word and about how predatory and two faced they are)

    The thing is - with its oil and gas industry making losses for the last 10 years and a crisis there yet to mature, with the massive deficit that military spending is producing in the US and rising interest rates, with the prospect of a crash - will there not be economic and resource restraints on further escalating the arms race in the USA? The current political leadership in the USA do not appear able to take that in and appear to be suffering from a severe case of hubris - but their failure to act on the resource restraints will bring internal problems to the USA...alread are doing...

    I agree that though that this is a most dangerous period because all the leading politicians - of left or right and the deep state and military industrial media complex cannot see what they are facing...

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Who

Ugo Bardi is a member of the Club of Rome and the author of "Extracted: how the quest for mineral resources is plundering the Planet" (Chelsea Green 2014). His most recent book is "The Seneca Effect" (Springer 2017)