Belmont Club

Taking a Chance

Go For Broke

The political rise of Sanders and Trump, argues Peggy Noonan, is the result of a comprehensive loss of faith in institutions.  “I have thought for some time that there’s a kind of soft French Revolution going on in America,” she writes.  With confidence in the status quo at so low a level, a kind of recklessness has taken hold of voters. “They’re thinking: Let’s take a chance. Washington is incapable of reform or progress; it’s time to reach outside.”

The story of how America got into trouble in the first place can best be understood by recalling what  Tom Schelling once observed: the two likeliest times for a gambler to bet is when he either has very good cards or very bad ones.   Schelling explained:

With an excellent hand, you should bet: you have nothing to lose if your opponent folds while giving yourself a good chance of winning a big pot if he calls. But with a middling hand, you should check and hope your hand winds the ante. What about a terrible hand? Should you bet or check? Checking would be unwise, because the hands will be compared and you will lose. It makes more sense to bet with these bad hands, because the only way you will win anything is if he drops out, and he might drop out of you make a bet. Perversely you are better off betting with awful cards and with mediocre ones, the quintessential (and rational) bluff.

In 2008 America’s cards were still flush from the Reagan years.  Its global position seemed unassailable. Though a financial economic crisis had just taken place, there was no reason not to think America would work its way out of it, as it had done before. Seemingly safe behind its design margin, America felt it could bet on Barack Obama, the self-described “blank screen on which people of vastly different political stripes project their own views”. Even if he was risky, they could afford to lose.

But they got the odds wrong.  Obama promised a big payoff: a world without nuclear weapons; a reset with Russia, a grand bargain with the Muslim world, even falling seas.  Yet in the end the probability he could deliver was surpassingly small.  Like a Powerball lottery, he wasn’t selling a realistic chance of winning, but a dream for a day.

Fast forward to 2016 and the wheel of fortune has reversed, and the money gone.  The current administration turned American hegemony into a “cash for clunkers” scrappage program and rued the consequences.  John Kerry told European allies in Munich:  “It’s pretty obvious that probably never in history have we been dealing with as many hotspots, as many failed or failing states all at one time, not to mention a Kim Jong-un and a nuclear program and other challenges all at the same time. So everybody here understands that. You wouldn’t be here otherwise.”

They were at Munich hoping to hear that America would save them.  Imagine their disappointment.  What is interesting about the game is that not just America but all the players have been steadily losing since 2008.  America’s loss was not Europe’s gain.  In fact, quite the contrary. Russia’s economy, for structural reasons, is headed for a collapse and nothing it can gain in Syria will change that. China’s bubble has burst.  The sole question is whether it will be bad or very bad.  Japan is down.  The BRICs have strangled themselves with corruption.  The top industrial economies of the late 20th century have been devastated by a depopulation bomb from which they are unlikely to recover for decades.

Europe was in no position to gloat.  Its continued irrelevance had advanced to the stage where it is no longer the result  of a lack of will but a fact of life.  The old continent has reached the point where it lacks both the money and men to remain important.  As the spending map by the Institute of Strategic Studies illustrates, defense spending among the main countries of Central and Western Europe is static.

Judy Dempsey of the Carnegie Foundation, who attended the Munich conference where John Kerry delivered his gloomy assessment, set down what she heard.  Europe has performed a post-mortem on itself  with a kind of fatalistic resignation.  “Unless the United States moves by putting boots on the ground in Syria,” she writes, “no one else—least of all Europe—will move … the second takeaway was that European governments are allowing the refugee crisis to rule Europe out of having any ambitions as a strategic player.”

No winners, just exhausted old regimes around a table.  In the words of Roger Cohen writing in the New York Times, the post World War 2 world including the Reagan victory has been mislaid sometime in the last seven years:

“the falcon cannot hear the falconer.” We live in an age of unraveling. The postwar is over. The post-Cold War is over. The United States, under President Obama, has quietly stepped back from Europe.

The world is most dangerous in a power vacuum. The geopolitical divides across the world are the most marked in at least a generation. This makes every issue more intractable. The United Nations has proved a complete dud on Syria. It took almost five years, 250,000 dead and more than 11 million displaced people for the Security Council to pass a resolution on a “road map” to peace. That map, for now, is utter fiction. For as many years, Obama did nothing.

Obama will of course, continue to do nothing. At least his harassed Secretary of State, John Kerry is dimly aware of of the brewing catastrophe.  Kerry is probably accurate in saying of Syria that “there is no military solution to this conflict” because no one is strong enough to emerge the victor. The failed Obama gambit drained so much energy from international system that it cannot rebuild order yet paradoxically left more than enough fuel to burn what was left.

The ruined cities of Homs or Aleppo may come to perfectly symbolize the current predicament, examples of once bustling places now without the wherewithal to rebuild yet with more than enough to destroy.  Like the militias in those agonized cities, the post WW2 Security Council members are no longer strong enough to pursue an independent strategy.  They will be forced into  a constantly shifting constellation of coalitions each competing and cooperating with the other to ensure survival and acquire gains.

Russia may pair off in its facile way with first one partner then another.  Turkey will play the same duplicitous game, only more duplicitously, as will China.  And Europe will do what is necessary to survive.  In both the international and domestic political spheres,  — betrayal and counterbetrayal —  will become the rule rather than the exception.  And this will continue until a new order emerges.

We have lost faith in our institutions partially because we have destroyed them.  Like evil children, we put the match to it in a fit of moral signaling without knowing where we will spend the night.  But we also lost faith in them because they no longer served the purpose.  For good or ill, there’s no going back.  To continue Roger Cohen’s phrase, not only has the post-Cold War world ended but we are already in the early stages of what future historians will describe as the conflict to establish its successor.

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