NEW WORLD COMING:

AMERICAN SECURITY IN THE 21ST CENTURY

SUPPORTING RESEARCH AND ANALYSIS

The Phase I Report on the Emerging Global Security Environment

for the First Quarter of the 21st Century 

The United States Commission on National Security/21st Century

September 15, 1999
Table of Contents

Foreword, Gary Hart and Warren Rudman ..............................................................................................

Preface, Charles G. Boyd...........................................................................................................................

Introduction .................................................................................................................................................

I: Global Dynamics.....................................................................................................................................

The Scientific-Technological Future: “What Will People Learn and Build?” .................................

Global Economics: “How Is Wealth Created?”.................................................................................

The Socio-Political Future: “How Will the World Be Governed?”...................................................

The Military-Security Domain: “How Will Societies Protect Themselves?” ...................................

II: A World Astir .........................................................................................................................................

Greater Europe .....................................................................................................................................

East Asia ...............................................................................................................................................

The Greater Near East .........................................................................................................................

Sub-Saharan Africa...............................................................................................................................

The Americas........................................................................................................................................1

III: The U.S. Domestic Future..................................................................................................................1

Social Trends........................................................................................................................................1

Technology Trends................................................................................................................................1

Economic Trends..................................................................................................................................1

Values, Attitudes, and National Will....................................................................................................1

Trends Affecting National Security ....................................................................................................1

IV: Worlds in Prospect ............................................................................................................................1

A Democratic Peace ............................................................................................................................1

Protectionism and Nationalism ..........................................................................................................1

Globalization Triumphant....................................................................................................................1

Division and Mayhem..........................................................................................................................1

A Patchwork Future ............................................................................................................................1

V: Major Themes and Implications ........................................................................................................1

Commission and Study Group Staff Rosters ........................................................................................1

Acknowledgements ....................................................................................................................1
Foreword

Over 50 years ago, President Harry Truman signed into law the National Security Act of 1947, the landmark U.S. nat

security legislation of the latter half of the 20th century. That Act brought the U.S. Armed Forces together under the Secr

of Defense and established the National Security Council to integrate all aspects of our nation’s power. The 1947 legislation has se

us well, providing us a template with which to deal with our primary challenge of the last half of the century—the Soviet Union. I

dergirded our diplomatic efforts, provided the basis to establish our military capabilities, and focused our intelligence assets.

Some things do not change. The survival and security of the United States remain our priority, we still cherish our freedom 

the promise of a good life, and we remain committed to our friends and allies. But in the future our national security system will 

to consider a world of chemicals and biological agents as well as nuclear weapons and conventional armies. We will find ours

challenged with protecting the information networks on which our banking systems and public services will depend, the disrupti

which could paralyze our economy and pose literally life-threatening dangers. Our potential adversaries will range from great mi

powers to “rogue” states to international criminals to malicious hackers. Future battlefields may extend beyond the air, the land

the sea into both outer space and cyberspace.

We are changing as a nation, as well, as our human complexion, values, and skill-sets evolve. Economic recessions, environm

degradation, and the spread of disease all have the potential to tear at our nation’s social fabric, which is the very foundation upon w

we stand. 

The thinking behind the 1947 law was rooted in the experiences of the Second World War and the earliest days of the Cold 

Fifty years without fundamental revision is a long time for any policy structure to endure, particularly during a period of such 

change. In 1997, U.S. lawmakers recognized that the country needed to conduct a thorough study of U.S. national security proc

and structures. In mid-1998, that study was chartered by the Secretary of Defense under the provisions of the Federal Adv

Commission Act and endorsed by the White House and Congressional leadership. Thus was the U.S. Commission on Nat

Security/21st Century (USCNS/21) born.

The Commission held its first business meeting in October 1998. Since then, it has conducted its effort in three phases, the 

two each designed to build upon what has come before:

New World Coming: The first phase, represented by this Report, explores the world developing between now and 2025. It id

fies what we can anticipate, as well as areas that may remain uncertain or subject to dramatic change. It also tries to understand 

we will look like as a nation over the next 25 years, and how we will fit into the world at large.

Seeking a National Strategy: The second phase will develop an overview of U.S. strategic interests and objectives for the ne

years. It will describe an overall national security philosophy and a strategy to support those interests and objectives.

Building for Peace: The third phase of the effort will examine our current legislation, government structure, and policy int

tion process to determine the extent to which the system inspired in 1947 supports our needs for the 21st century. To the extent t

does not, changes will be proposed for implementation.

This Report represents the culmination of phase I of our efforts. We trust that it will prove to be the sturdy foundation we 

to build the rest of the study. We believe it is that foundation.

Warren Rudman Gary Hart

iv
Preface

The United States Commission on National Security/21st Century was chartered to provide the most comprehensive go

ment-sponsored review of U.S. national security in more than 50 years. The Commission’s tasks are three:

First, to analyze the emerging international security environment; 

Next, to develop a U.S. national security strategy appropriate to that environment;

Finally, to assess the various security institutions for their current relevance to the effective and efficient implementation o

strategy, and to recommend adjustments as necessary. 

In sum, this Commission seeks to promote the security interests of the nation and its citizens at home and abroad, to safeg

American institutions and values, and, ultimately, to preserve the independence and well being of the United States for succeeding 

erations of Americans. 

It has fallen to us, just as it has to all generations since the founding of the Republic, to “provide for the common defense

do so, moreover, at a time when the international landscape is changing rapidly in the wake of the Cold War. Our security institut

fashioned in an earlier era under conditions that no longer exist, may not be able to respond to circumstances their designers di

foresee. The first step in assessing the current suitability of those institutions is to anticipate the emerging conditions under which 

must function. But how, as one classical historian put it, are we “to divine the unseen future that lies hidden in the present?”

Broadly speaking, there are three methods of contemplating the future. One assumes that the future will mirror the past. A se

envisages abrupt change and tries to hedge against it. A third attempts to discern the underlying causes of current trends, in ord

anticipate how those causal forces will shape the future. Each has its merits and limitations. The problem, of course, is to under

which method is most appropriate to the particulars of time, place, and subject.

Had a study similar to our own been undertaken in 1956, anticipating the quarter century to come, the first method would 

worked best. From 1956 until 1981, much of the world was divided, geo-strategically and ideologically, into two hostile camps

United States, the Soviet Union, the United Kingdom, Germany, France, and Japan were the centers of economic and military-in

trial power. Nuclear weapons prevailed in the strategic arsenals of the world’s great military powers; their surface combatants 

submarines continued to roam the seas, artillery and main battle tanks dominated land operations in warfare, and air power 

ubiquitous. Despite many changes in the world, both the political alignments and military technology that dominated in 1956 

remained in 1981. The world grew accustomed, uneasily, to continuity.

Had a study begun in 1925, pointing to 1950, the second method, which envisages abrupt change, would have been best. A

era began, Germany and the Soviet Union were weak powers, and Asia and Africa were still largely controlled by the great and we

imperial powers of Europe. The United States had recoiled from world politics following the frustrations of the Great War an

aftermath. Battleships were the capital ships of the world’s great navies, infantry doctrine defined armies, and the airplane was 

primarily as a tool to support land forces. By 1950, however, European economies were just emerging from ruin, their overseas col

empires were dying, the Soviet Union and the United States had become rival superpowers, and America was committed by trea

the defense of Western Europe. The military domain had absorbed at least two major revolutions: the full exploitation of the 

dimension through air power, and the advent of nuclear weapons. Warfare for the United States had changed dramatically thr

unifying the operations of land, sea, and air forces, and would never be the same again. 

Given the magnitude of change now clearly underway, our study primarily adopts the third way to contemplate the next 25 y

We have attempted to distinguish the determinants of current trends so as to anticipate their effect on the future. As before, the 

ponents of change will be technological, economic, political, and military.

No one, of course, can predict exactly how that next quarter century will unfold. Through available lenses, we can foresee 

things with reasonable clarity—demographic patterns, for example. Other phenomena, however, are rather more opaque. Nonethe

we have used every analytical tool we could find to discern and analyze the emerging world. Finally, we have tried to find a p

balance between confidence and humility, both being important in any effort of this kind. We trust we have achieved that balance

that its result will prove to be a sturdy foundation and an illuminating guide for the next two phases of the Commission’s effort. 

Charles G. Boyd 

Executive Director
Disclaimer

This document reflects the work of the National Security Study Group, a collection of natio

security scholars and practitioners whose task it has been to provide basic research and analyt

support for the chartered task of the United States Commission on National Security/21st Cent

From this document, the Commissioners have drawn fourteen major conclusions that they h

published separately under the title, New World Coming: American Security In The 21st Cent

Major Themes and Implications. Not every proposition or nuance in this analysis is endorsed 

every Commissioner. 
SUPPORTING RESEARCH AND ANALYSIS

U.S. Commission on National Security/21st Century 

Introduction

The future, in essence, is this: The

American “moment” in world politics,

which combines bloodless victory in the final

stage of the Cold War with the apparent global

triumph of fundamental American ideals, will

not last forever. Nothing wrought by man does.

In the next 25 years, the United States will

engage in an increasingly complex world to

assure the benefits that we—and most of the

world with us—derive from American leadership. 

As powerful as the United States may well

be over the next 25 years, the world will not be

tidily managed, whether from Washington or

from anywhere else. History has not ended,

mankind’s cultural diversity endures, and both

the will to power and the pull of passionate

ideas remain as relevant as ever in political life

both within and among nations. 

A diffusion of power thus stands before us,

but not necessarily one of the classical sort. A

new balance of power may arise that would be

intelligible even to the statesmen of the 18th and

19th centuries, but something more, and something different, will overlap and perhaps

overwhelm it. The ever tighter harnessing of

science to technological innovation, and of that

innovation to global economic integration, is

changing the rules of international engagement.

It is even affecting the identity of its engaging

parties. The sway of state power has always

fluctuated within society, and states have often

competed with other institutions for influence

beyond their borders. But the challenges now

being mounted to national authority and

control—if not to the national idea itself—are

both novel and mighty. 

It is not a foregone conclusion that the role

of the state will be permanently diminished, or

the system of sovereign states reformed 

replaced on account of these challenges. 

both the system and its member units 

certain to change as a consequence, as t

have always changed from having been tes

In the years ahead, borders of every sort—g

graphical, communal, and psychological—

be stressed, strained, and compelled to rec

figuration. As the elements and vulnerabili

of national power shift, they will often le

current institutional arrangements at logg

heads with reality. Already the traditio

functions of law, police work, and mili

power have begun to blur before our eyes 

new threats arise. 

Notable among these new threats is 

prospect of an attack on U.S. cities by indep

dent or state-supported terrorists us

weapons of mass destruction.1 Traditional 

tinctions between national defense 

domestic security will be challenged furthe

the new century unfolds, and both conventio

policies and bureaucratic arrangements wil

stretched to and beyond the breaking p

unless those policies and arrangements 

reformed.

The future is also one of rising stakes, 

good and for ill. Humanity may find way

compose its disagreements, succor its p

heal its sick, and find new purpose in comm

global goals. But if it fails at these tasks

stands to fail more spectacularly than ever. T

is because greater global connectedness le

one way to benefit and another way to mis

tune. Economic downturns that have usu

been episodic and local may become, thank

the integration of global financial mark

more systemic in their origins and hence m

global in their effects. The greater wealth 

may be expected to flow from global econo

1 See William S. Cohen, “Preparing for a Grave New World

Washington Post, July 26, 1999, p. A19.
U.S. Commission on National Security/21st Century 

2 NEW WORLD COMING

integration will nevertheless produce growing

inequality within and among nations. The

march of science and technology, too, will

provide ever more powerful tools—tools that

can be used for benefit in the right hands, but

that may pose even genocidal dangers should

they fall into the wrong ones. The next 25 years

may well force mankind back to first principles

over the ethical dilemmas inherent in biotechnology. Our concept of national security will

expand. Our political values will be tested as

our society changes. In every sphere, our moral

imaginations will be exercised anew. 

Some things, however, will not change. We

will no doubt revisit many times the three

oldest questions of political life: How is legitimate authority constituted? What is fair in

social and economic life? How do we reconcile

disagreements? Historical principles will still

apply as we ponder these and other questions.

There will still be great powers, and their

mutual engagement will still matter. As ever,

much will depend on the sagacity and good

character of leadership. Misunderstandings,

misjudgments, and mistakes will still occur, but

so will acts of brave leadership borne on the

insight of exceptional men and women.

The upshot of the changes ahead is that

Americans are now, and increasingly will

become, less secure than they believe themselves to be. The reason is that we may not

easily recognize many of the threats in our

future. They will differ significantly from the

dangers to which history has accustomed us:

ranting dictators spouting hatred, vast armies on

the march, huge missiles at the ready. They may

consist instead of unannounced attacks by subnational groups using genetically engineered

pathogens against American cities. They may

consist of attacks against an increasingly integrated and vulnerable international economic

infrastructure over which no single body exercises control. They may consist, too, of an 

raveling of the fabric of national identity its

leading several important countries to fail 

disintegrate, generating catalytic regional cr

in their wake. 

The main policy challenge in all s

cases, diverse as they may be, is the sa

How does an American national leaders

bring the country together and marshal its 

sources to both seize new opportunities 

deal with novel threats? But we are gett

ahead of ourselves. Before moving to ar

ments and evidence, let us first briefly descr

ways and means.

“No man can have in his mind a c

ception of the future, for it is 

yet,” wrote Thomas Hobbes in Leviathan, “

of our own conceptions of the past we mak

future.” Hobbes meant two things by this st

ment: most obviously, that the past is the o

basis upon which to forecast the future; m

subtly, that social life tends to freeze into it

the conceptions we have of it. Hobbes 

twice right. Absent the gift of prophe

history’s recurrent patterns, discontinuities, 

intimations about human nature compose 

only means of reckoning ahead. It remains t

as well, that the very act of probing the fu

tends to shape it, for we often act on our an

ipations in ways that invite their arrival. 

It is therefore no mean feat, and an ac

no little consequence, to describe the inter

tional environment for U.S. national security 

years hence. Let anyone who doubts the d

culty inherent in the task look back as far as 

study looks ahead.2

In the late summer of 1974, just 25 ye

ago, the United States had just passed 

deepest throes of a major constitutional and 

2 See Study Addenda, part 1.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

litical crisis. Its economy was more anemic

than it had been at any time since the Great

Depression and it had just lost a war, a process

accompanied by deep social divisions and a

massive loss of faith in the national purpose.

America’s most serious global adversary, the

Soviet Union, was steadily augmenting its

strategic military clout and pursuing territorial

encroachment by proxy from Africa to Central

America. Meanwhile, America’s key allies in

Europe and Asia were hedging their bets over

American leadership and seemed set to

overtake the United States economically. Faith

in the future of democracy and the health of

market economies declined both at home and

abroad. Not many predicted then that just 25

years later, the United States would be standing

at a pinnacle of national prosperity and international power, its institutions very much intact

and its core political values vindicated on a

global scale.

Clearly, the U.S. national trajectory in the

world has pointed upward since 1974. Over the

next 25 years, however, it could point other

ways. Nevertheless, our point of departure in

this study is an assumption that the United

States, a primary political, military, economic,

and cultural force in the world today, will

remain such a force through 2025. Its size,

wealth, power, cultural sway, and diplomatic

reputation render it inevitable that the United

States will retain a significant role, and be a

significant factor, in shaping the international

security environment.

We also make three key methodological assumptions: that the definition of national

security must include all key political, social,

cultural, technological, and economic variables

that bear on state power and behavior; that

future projections based solely on today’s

trends are liable to be misleading; and that

while forecasting a range of futures is possible,

predicting a specific one is not. The reason 

this last assumption is critical, and it is this: 

future is contingent. Human history does 

just happen; it is made. The state of glo

affairs in 2025 will be determined by an ar

of decisions, large and small, most of wh

have not yet been made. Our problem, th

fore, is not how far we can see out on the r

ahead with the best of analytical tools. 

problem is that the road is not straight, and 

even the highest power binoculars allow u

see around curves.

However difficult looking into the fu

may be, it is both necessary and irresistible

is necessary because the stakes are so high 

even an imperfect effort is better than non

all. It is irresistible because we are hum

beings: curious, emotionally engag

beckoned to challenge. We have organized N

World Coming in five parts. Part I, “Glo

Dynamics,” sketches an overview of the ra

of major systemic changes we see arising o

the next 25 years. These are organized, in tu

according to four basic categories: scienti

technological, economic, socio-political, 

military-security. Part II, “A World Astir,” lo

at regional trends in light of global dynamic

Part III, “The U.S. Domestic Future,” exam

what the United States itself will be like o

the next quarter century. American resour

and social cohesion will influence how m

power the state will have at its disposal, 

American domestic political culture will h

shape how the United States exercises 

power in the world at large. 

Part IV, “Worlds in Prospect,” translates 

analyses of the three foregoing sections 

four global scenarios. The purpose is no

predict which of these worlds will come 

being, but rather to offer heuristic device

help us encapsulate the forces that will d
U.S. Commission on National Security/21st Century 

4 NEW WORLD COMING

the world toward one of several alternative

futures over the coming 25 years. The scenarios

describe the interplay of developments in technology and economics with associated social,

political, and military environments. These four

scenarios are followed by a speculation that the

first quarter of the 21st century will be a patchwork of these four worlds. 

Part V, “Major Themes and Implications,”

is a summation of the Commission’s findings.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

I: Global Dynamics

The future is an enigma wrapped in familiarities. If we were suddenly

transported back 25 years to 1974, we would

feel much at home, yet we still could not

foresee the world of 1999. We could not predict

the end of the Cold War, the information revolution, the sustained economic growth of the

1990s, or the specific collection of conflicts

that have lately roiled international politics. So,

too, even though we are liable to feel at home

in 2025—if only because our arrival there will

be so comfortingly gradual—many things will

have changed that we cannot foretell. 

Social change involves not a single but a

twin puzzle. To the one side is the ceaseless

buzz of natural and human activity that seemingly amounts to nothing of real significance.

But to the other side, we suddenly awake to

great transformation in domains where we have

sensed no activity at all. Just as we do not feel

the earth turning on its axis despite the considerable speeds and distances involved, we

usually do not “see” social or political change

as it occurs. 

There are grand theories of social change

that grapple with this twin puzzle, but we need

only recognize that social reality has multiple

and interactive sources. Some are proximate,

such as those animated by personalities, intellectual fashions, and happenstance. Others are more

remote, including those embedded in the

physical environment, the biological constitution

of the species, and the perdurable patterns of

human culture. We proceed here by examining

scientific-technological trends and prospective

patterns in the global economy, then move to the

socio-political dynamics affecting and affected

by both, and conclude with a discussion of the

international military-security domain. 

The Scientific-Technological Futu

“What Will People Learn and Build?

The tools that Americans and oth

have built in this century alone h

wrought major social and political change

technologically advanced countries, most 

them unanticipated. Mass electrification tra

formed economies by revolutionizing b

manufacturing techniques and consumpt

patterns. Extensive private ownership of au

mobiles led to vastly increased labor mobi

to new spatial patterns in residential life a

particularly in the United States, to the adv

of the suburbs. Suburban life, in turn, accele

ed the integration of diverse communities in

new mainstream, changed voting patterns 

purchasing behavior, accelerated the separa

of generational cohorts within exten

families, and altered the social functions 

economics of major cities. Antibiotics beg

demographic revolution and, with ot

advances in medical science, contributed to 

transformation of religious sensibilit

Television brought a nascent commer

culture still at the margins of social conscio

ness in the mid-1940s into the core of so

life. Birth control technologies have alte

gender roles and family patterns. 

The political impact of these developme

is virtually incalculable. Skill-sets and c

values, even the foci of national identity, h

all been altered. If the point that technology 

fluences social and political life is 

sufficiently clear at the national level, cons

the epic struggles of the 19th and 20th centu

between various forms of socialism and lib

democracy. The basis for those struggles 

the enormous social and psychological disco

nuities unleashed by the Industrial Revolut

since it was that Revolution that turned the 

cialist idea into programmatic ideologies. N

social and political discontinuities will sur
U.S. Commission on National Security/21st Century 

6 NEW WORLD COMING

flow from the major scientific discoveries and

technological innovations that await us in the

next century. Indeed, so vast are their implications that we can only hint at them here.

What technologies will emerge over

the next 25 years? The general characteristic that stands out with respect to new

technology is a major shift in paradigms of

scale. Until the 1970s, the reigning industrialtechnological paradigm was one in which

factories grew larger to serve global markets;

buildings grew taller, concrete spread wider,

and continents were linked by ever larger

jumbo jets. Gigantic rockets lifted men to the

moon and, with multi-megaton warheads, underwrote the nuclear standoff. Efficiency and

status lay in large scale. Now, however, miniaturization, adaptability, and speed are primary

traits. Ever more capacity is being placed on

tiny silicon wafers, and we are beginning 

mimic the molecular assembly capabilities 

biological systems. 

The most striking innovations of the n

quarter century will occur in three basic c

gories, and combinations thereof. Th

categories are information technology, biote

nology, and micro-electromechanics (MEM

Great strides in information technol

will continue, and the social impact will 

great. Internet use is increasing dramatic

around the globe and will continue to do so

Computing power will grow and co

per unit of value will decline. Networks w

be ubiquitous, software will be smarter, 

computers will assume more “human” ch

acteristics in terms of voice and vis

Internet Users Are Increasing
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

capacities. There will be near-universal

access to information and many forms of expertise on a global scale by 2025, if not

before. The entire world will be linked, so that

from any stationary or mobile station it will be

physically possible to send and receive nearinstantaneous voice, video, and other serial

electronic signals to any other station. If the

millennium about to pass into history is remembered as the time when humanity first

recognized its common planetary space, the

first century of the coming millennium may be

remembered as that in which humanity

achieved the potential, if not the reality, of full

connectedness in real time. We will witness,

as it has been called, the death of distance.3

Information technology will make much of

our environment interactive, both with respect

to devices that respond to our wishes, and with

respect to other people. By 2025, vast numbers

of people—large majorities in advanced societies—will carry their own personal

infospheres with them, perhaps wearing them

in their clothing and powering them with the

mere kinetic motion of walking.4 Most people

and vast amounts of information will be accessible at all times, in all places, in a world where

a tailored virtual work environment will accompany us whenever we wish. When we

travel, our cars will have GPS receivers networked to central databases, allowing for a

constant update of map and traffic information.

Upon arriving home, the environment will

adjust to our presence thanks to linked, programmable appliances. Entertainment will take

on a more cosmopolitan flavor since it will

reflect global connectivity. We will be able to

associate “virtually” with any person or group

sharing our interests in hobbies, politics, ethnicity, or religion. 

Even more dramatic than new innovations

in information technology, major developments

await us in biotechnology. By 2010, biote

nology may overtake information technolog

terms of economic investment; whether it d

or not, it will almost certainly overtake i

terms of macro-social impact.5 Both busin

and, to a lesser but not small extent, gove

ments will sustain large research 

development funding in biotechnology. T

funding, along with parallel advances 

genetic engineering and tissue-growth resea

will spur rapid innovation and related econo

growth. 

Capabilities could be startling by toda

standards. If governments permit, genetic en

neering will allow sex and specific t

selection in infants. Cloning human organs 

be possible, and in some instances comm

Many viral diseases will be better understo

and stem-cell technology could allow tr

ments for many degenerative neurolog

ailments. Treatments to enhance the hum

immune response against diseases will 

possible. “Farmaceuticals” will be read

available, with cows, pigs, and sheep w

altered genes providing proteins with med

value in their meat and milk. Agriculture 

be transformed by higher productivity, nu

tion- and vaccine-enhanced foods, and gre

plant resistance to (known) pests. Ta

together, these innovations suggest that 

human life span in the developed world co

shift from the present average of about 

years to at least 85 years—and perhaps to 

3 Coined by Frances Cairncross, The Death of Distance: Ho

the Communications Revolution Will Change Our Live

(Boston: Harvard Business School Press, 1997). 

4 MIT’s Lincoln Lab is experimenting with a sneaker-borne

battery powerful enough to drive integrated circuits.

Merely walking produces sufficient energy. See T. Sta

“Human-powered Wearable Computing,” IBM System

Journal, Vol. 35, Nos. 3&4, 1996.

5 See Forecast `98: A Vision for Advanced Research and

Technology (Fort Meade, MD: National Security Agen

1998), p. 29; and The U.S. Biotechnology Industry, Of

of Technology Policy, 1997.
U.S. Commission on National Security/21st Century 

8 NEW WORLD COMING

much as 120 years—within the next quarter

century. 

Between now and 2025, cheap, highdensity microelectronics will proliferate in the

tools and the physical environment of those

living in technologically advanced societies.

We will become familiar with MEMs: microelectromechanical devices in which sensors,

transmitters, receivers, or actuators (switches

that activate mechanical devices) have been

miniaturized to the size of a transistor. Such

technologies will affect our lives in many ways.

Should we become sick, our doctors will know

as soon as, or even before, we do, for microsensors will constantly monitor our health.

Smaller, more capable sensor devices will help

insure the safety of both home and work.

Energy bills will drop due to the use of low

power devices. Airplane wings will feature microscopic sensors on their surfaces, allowing

for faster travel at more efficient speeds. MEMs

may also allow far more intrusive and cost-effective exploration of outer space, with

unknown economic, political, and possibly

moral implications.

Dramatic new capabilities in MEMs devices

will appear as the long awaited nanotechnology

revolution takes hold. In nanotechnology,

devices are manufactured using molecular fabrication techniques not unlike those found in the

human body. Many new technological advances

will be based on bio-mimicry—the deliberate

attempt to capitalize on what nature has learned

through millions of years of evolution. To

borrow from Eric Drexler, one of the founding

fathers of nanotechnology, we will be engaging

the “engines of creation” to alter the tools we

use.6

Current developments indicate that nanotechnology, though in its early stages, will

develop rapidly. In July a research team was

able for the first time to fashion simple co

puting components no thicker than a sin

molecule.7 This is a breakthrough that, in re

spect, may come to rival in importance Enr

Fermi’s nuclear chain reaction in a squash co

at the University of Chicago in 1942.

The implications of nanotechnology 

particularly revolutionary given that such te

nologies will operate at the intersection 

information technologies and biotechnolog

This merging and melding of technologies 

produce smaller, more stable, and cheaper 

cuitry that can be embedded, and function

interconnected, into practically anything—

cluding organic life forms. The implication

such a fundamental innovation for advance

materials science, medicine, transportati

energy, manufacturing, and agriculture are 

multaneously huge and still mostly unknow

What is clear is that such basic innovat

will allow for more sophisticated scientific 

plorations of our environment. It will facili

the gathering of information and advance 

understanding of complex distributed syste

Such technologies may also merge with, 

aid, major advances in theoretical physics, p

ticularly in the areas of complexity and ch

theory. The results will not be just theoret

and intellectual, but will have dramatic im

cations for creating new technolog

synergies and for developing ever more 

phisticated applications of our new tools.

6 Eric Drexler, Engines of Creation (New York: AnchorDoubleday, 1987). Many of Dr. Drexler’s concepts aw

experimental verification. 

7 John Markoff, “Tiniest Circuits Hold Prospect of Explosiv

Computer Speeds,” New York Times, July 16, 1999, p. 

8 There are several ongoing projects that estimate technolog

innovation. See, for example, William E. Halal, Micha

D. Kull, and Ann Leffman, “Emerging Technologies:

What’s Ahead for 2001-2030,” The Futurist, Nov.-Dec

1997.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

However dramatic such potential breakthroughs may be, they will not

revolutionize everything within a 25-year

period.

The belief in a revolutionary shift in world

energy patterns will not die. Many scientists

hold faith in nuclear fusion, or in a hydrogenbased energy economy. Some believe that

energy may one day be mined from the

vacuum of space—zero-point energy, so

called. Still others believe that substituting

ethanol for standard gasoline can make a major

impact on energy balances, and that genetic

engineering can radically increase the biomass

available to make ethanol, thus radically

reducing the price.9

The problem with these prognostications,

save for the last one, is that they offer no

viable solution for the inertia inherent in

existing fossil fuel infrastructures. Even if a

major innovation does come from the laboratory, it will take most of a 25-year period to

create the supportive production, transportation, and marketing infrastructures necessary

to make a major difference on a global scale.

We should expect steady advances in the labs

and important practical innovation, not so

much in energy sources as in the efficiency

with which new devices use energy. Major

advances in batteries are a near certainty, and

urban-use automobiles that run on fuel cells

are likely, too. As the economies of many

advanced countries become more knowledgebased, and as telecommuting, telemarketing,

and e-commerce become more prevalent,

energy consumption patterns may change for

the better, as well. 

But unless the ethanol solution transforms

the global energy industry, fossil fuels and

their locations will still matter economically

and in the political calculus of major powers.

Indeed, demand for fossil fuels will grow 

the economies of Asia and other parts of 

developing world expand.10 American dep

dence on foreign sources will also grow o

most of the next quarter century. If pri

remain moderate enough to depress the 

ploitation of marginal or difficult-to-ext

fossil fuel reserves—as may well be the c

over the next two and one-half decades—t

the importance of Persian Gulf producers w

actually grow back to levels reminiscent of 

mid-1970s. 

This is not the place to detail all 

various innovations in science 

technology that will shape our lives in the n

25 years, or to speculate about those that 

not. In any event, what matters for the purpo

of this study is less the devices themselves 

more their social and political impact, and h

the prospects are mixed. While new scientific 

coveries and technological innovations hold 

the promise of enormous benefits, they will 

present many challenges, some of them cogni

and practical, others moral and philosophical

One reason to expect new challenges is 

change will come upon us faster than ever. 

speed with which new technological inno

tions enter the commercial and thus the so

mainstream will continue to increase, leav

society less time to adjust. It was with great 

9 See R. James Woolsey and Richard G. Lugar, “The New

Petroleum,” Foreign Affairs, Jan./Feb. 1999. The Clint

Administration endorsed major research in this area in

August 1999.

10 See Energy Information Administration, Annual Energy

Outlook 1999 (Washington, DC: Department of Energ

December 1998); Geoffrey Kemp, Energy Superbowl:

Strategic Politics and the Persian Gulf and Caspian B

(Washington, DC: Nixon Center for Peace and Freedo

1997); and Anthony H. Cordesman, The Changing

Geopolitics of Energy (Washington, DC: Center for

Strategic and International Studies, August 12, 1998). 
U.S. Commission on National Security/21st Century 

10 NEW WORLD COMING

justified anticipation that Thomas Alva Edison

threw the switch that electrified Pearl Street in

lower Manhattan in 1882, but it took another

thirty years before the commercial and social

implications of electricity hit full stride in the

United States. Nowadays, moving from the

germ of a scientific breakthrough to the mainstreaming of new devices may take little more

than a year.

There are good reasons for the picking up

of this pace. First, basic science is increasingly wedded to technological innovation, and

this new conjunction in turn is increasingly

wedded more closely to industry than to government defense labs. One result is that

considerably more research and development

investment is flowing to basic science, in both

universities and commercial labs, than ever

before. This trend, almost certain to widen and

accelerate, means that the propensity for

breakthroughs has been virtually systematized. 

Second and closely related, in much of the

world, and particularly in the United States,

markets allow for the rapid commercialization

of new technologies, and populations have

become used to ceaseless innovation. The

result is a cultural propensity to accept and

adapt to innovation, which in turn works as an

accelerator to innovation itself. 

Third, information technology accelerates

innovation because it is simultaneously a

product and marketing device. The first thing

that television advertising stressed was the

purchase of more televisions, so that the technology became self-replicating in market

terms. The array of new commercial information technologies, from personal computers to

Internet nodes to GPS devices to cell phones,

trumps the self-replicating capacity of television by orders of magnitude. This technology

is its own infrastructure and its own commercial multiplier effect—and it will be used in 

future to market other innovations, many 

which will doubtless be linked with inform

tion technology and biotechnology.11

Fourth, the technologies of the future w

be far more knowledge-based than phys

resource-based, and the constraints impo

by extracting and processing bulk mater

will shrink proportionately. What o

required tons of steel and concrete to crea

given increment of GDP growth now requ

a tiny fraction of that weight in plastic 

silicon. While the presumed “de-material

tion” of the world can be exaggera

knowledge-based innovation is freer to m

ahead rapidly, constrained only by the av

ability of human capital and the organizatio

capacities of society to marshal and exp

that capital.

One of the inevitable consequences 

an increased pace of innovat

married to an interweaving of basic scie

fields is that our capacity to anticipate spec

developments shrinks. In a way, we beco

smarter and dumber at the same time. We 

this already in the way that the informat

revolution has played out in the last 

decades; while very few wish to turn back 

clock, there is no denying the disruptions 

business and personal lives that many have 

perienced.

Information technologies have already 

a significant impact on most individuals in 

United States and other technologic

advanced countries. We already have a ru

11 See Daniel A. Losk and Randall P. Nottingham, “Global

Market Penetration of Communications Equipment:

Computers, Telephones, and Televisions,” Standard &

Poor’s DRI World Economic Outlook, First Quarter 19

p. 39.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

mentary personal infosphere: witness the

number of people driving down the freeway

using cell phones and staying in daily contact

with relatives and business associates via email. We know, too, that individuals in

technologically advanced societies are in many

respects more powerful than ever before. They

know more, and, by extending their senses

more effectively, are more efficacious than any

generation before them. They are more longlived than any previous generation, as well. 

The domain of the personal infosphere will

grow over the next 25 years, both vertically

and horizontally. In other words, the sophistication of such spheres will rise, and the

number and types of people who have them

will proliferate over much of the world. As a

result, the physical boundaries of our neighborhoods and business locations will become

less relevant as individuals create virtual communities of common interests—“communities

of choice” or “hobby tribes,” some have called

them—by electronic means. Through our computers we will visit any business site or read

the latest in science and culture as we choose,

or communicate with others who share our interests anywhere at virtually any time. The

Internet will provide interactive rather than

mainly passive information; it will become a

tutor rather than just a reference resource in

subjects of our own choosing. In that sense if

not also others, as one observer put it, “time

zones will become more important than

borders.”12

This prospective technological environment will pose certain problems. Individuals

will have to cope with new levels of complexity. No one will fully understand the

environment or be able to master the massive,

continuous flow of information about it. One

of the key social implications of the technologies in our future is that they will tend to

confound all attempts at centralized cont

not unlike the logic of the marketplace. 

succeed, as individuals and as organizatio

will mean adapting to a life of continuous e

cation and operational redesign. N

information/knowledge tools will become 

tutors and guides. Compared to the pres

everything will be hurled into relative mot

Some people and some organizations will c

better than others in such circumstances, 

those left behind will suffer economically

short, new technologies will create new fil

for sifting out winners and losers in society

Adding to the press of complexity and 

formation overload will be the pressure 

short reaction times. The Internet alre

allows us to do things globally in near real t

that used to take weeks or months. In the p

we have always had time to prepare and re

and to weigh the potential consequences of 

actions. In the future, we may process more 

formation but, held in thrall by the grip of 

technology itself, we may actually be pron

think less about it. Many will learn the h

way the differences between data, informat

and knowledge. Hard as this challenge wil

on individuals, it will be even harder on la

organizations and especially on governmen

As a consequence, we may be headed f

considerably more stressful cognitive envir

ment. While stress is a subjective notion 

some extent, it does have an objective phy

logical basis, and potential health implicati

flow from it. Disease patterns could shift; 

might learn to cure many forms of cancer o

to be plagued by a host of cardiovascular 

psychological maladies that rest today at 

fringes of our health concerns. Stress may a

lead some people to seek more predictabilit

12 Walter B. Wriston, “The Third Technological Revolution

Foreign Affairs, Sept./Oct. 1997, p. 172.
U.S. Commission on National Security/21st Century 

12 NEW WORLD COMING

their lives and to compensate for uncertainty in

some realms by magnifying certainty in

others.13

But it is not a foregone conclusion that a

high-technology future will be more stressful

for most people. More prosperous and healthier people with more recreational time on their

hands may well be under far less stress. If, in

addition, telecommuting saves countless hours

of being stuck in traffic and allows more people

to live in idyllic environs, then, rather ironically, more people would experience more of

nature thanks, in essence, to high technology.

New technologies will also affect developmental and educational issues. As with any

young animal, a human child’s neural networks

form as a function of the pace and nature of the

stimuli the child encounters in the environment.

Some neurophysiologists believe that a child

who has spent hundreds of hours watching

“action” television and playing fast-paced

computer games before reaching age six may

have a hard time sitting still in a standard classroom, where the pace of activity is far slower.

This does not necessarily mean that there is

anything inherently wrong with the technology

or the games. But this technology does bear implications for better understanding controversies

over the definition and treatment of hyperactivity, or attention deficit disorders, in pre-adolescent

children, and for educational methods generally.14 There is a good prospect that educational

methods will be revolutionized for the better

once we fully understand and learn how to apply

the new technologies at our disposal.

Families as well as individuals will have to

cope with new circumstances. The denizens of

the most advanced countries will face new responsibilities as parents and citizens in managing

and utilizing the information age. As the natural

limits and disciplines imposed by physical and

social borders shift and sometimes dissolve, in

viduals will have to accept more responsib

for their own mental and moral balances. As 

observer put it, a totally open and unfilte

network, operating amid the frenetic pace of c

temporary life, means that “the most impor

thing parents need to understand about prepar

their kids for the Internet world is that it requ

not more whiz-bang high-tech skills, but ra

more old-fashioned fundamentals” such as g

parenting, a functional family life, and h

quality basic education.15

Borders between generations and se

will shift, too. As to the former, 

faster the rate of technological innovation, 

more likely that younger people will be at 

forefront of it as “technological generatio

grow ever shorter. This is despite the fact tha

many people living longer and healthier l

may compose a “new middle-aged”—th

between, say, 55 and 75—who may be far m

active and productive as a group than ever bef

The relatively greater economic utility and st

of young people may have enormous social 

plications in many societies. 

For much of human history, advanced 

signified deeper knowledge in nearly ev

13 Some believe that the growing popularity of gated comm

ties owes something to this motive, particularly for tho

invested in the fast-paced, high-stress corporate world

Robert D. Kaplan, An Empire Wilderness: Travels into

America’s Future (New York: Random House, 1998), 

33-5; and Edward J. Blakely and Mary Gail Snyder,

Fortress America: Gated Communities in the United S

(Washington, DC: Brookings, 1997). 

14 Empircal research relevant to this connection is detailed 

Jane N. Healy, Your Child’s Growing Mind: A Guide t

Learning and Brain Development from Birth to

Adolescence (New York: Doubleday, 1994). See also,

“Understanding TV’s Effects on the Developing Brain

AAP News, May 1998; and Committee on

Communications, American Academy of Pediatrics,

“Children, Adolescents, and Television (RE9538),”

American Academy of Pediatrics, October 1995. 

15 Thomas Friedman, “Are You Ready?” New York Times, J

1, 1999, p. A23.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

society. Old people used to be relatively rare,

and it has always made a certain evidential

sense that the more experience someone has the

wiser they are liable to be. The nature of

prospective technological processes turns this

tradition on its head. With younger minds more

flexible and absorptive, and hence more

valuable to a continuously innovating society,

the continued veneration of elders will make

less evidential sense, particularly as population

pyramids invert and there are more elderly than

young. This may be especially problematic in

Confucian societies, but it will have an impact

on Western ones, as well. 

As to gender differences, as we head into a

knowledge-based economy driven by technologies characterized by smallness and speed, the

relevance of males’ greater size and physical

strength will further diminish. Historically, the

larger average size and strength of males determined the division of labor in families. As first

animal and then machine calories were substituted for those of human muscle, the economic

relevance of gender distinctions and divisions

began to fade. The lag time between economic

reality and culture has been considerable, but

culture has been catching up. The next few generations of technology should close the gap

further, and one implication is that women will

move in greater numbers into positions of

public authority. 

There are honest differences as to what this

implies, but most speculation on the point

exceeds the grasp of current evidence.16 It is

clear, however, that women’s issues are the

main barometer of social change in many nonWestern societies, and in some places the

vanguard force in breaking down patterns of

social stasis.17 So while the impetus for sexual

equality has been mainly a Western phenomenon in this century—and while technology has

had a good deal to do with it—its main global

impact in the next century is likely to be in n

Western domains. The arrival and accultura

of new information technologies in such ar

are likely to greatly reinforce this impact

women have an equal chance as men to m

themselves master over such tools.

Several divisive issues will arise 

account of some new biotechnolog

that will affect gender and other human tra

Many ethical problems reside in the grow

technical ease with which parents may cho

the sex, and other traits, of their child

Similar ethical—and practical—problems 

also inhere in the use of increasingly pre

means of altering mental states, including n

psychopharmacological methods of induc

happiness, self-esteem, and other emotio

entirely divorced from any behaviors in 

world. 

Many problems will also be raised by 

prospect of radically prolonged life spans. F

and foremost is the question of access: W

will get to use such technologies, and who 

not? How will scarce medical resources be 

portioned if everyone claims a right to 

radically lengthened life? Should finite 

sources be spent on prolonging life when th

resources are needed for saving younger li

from the ravages of disease? How w

advanced countries deal with social po

issues concerning retirement age and bene

pension funds and medical insuran

16 See Helen Fisher, The First Sex: The Natural Talents of

Women and How They Are Changing the World, (New

York: Random House, 1999); Francis Fukuyama, “Wo

and the Evolution of World Politics,” Foreign Affairs,

Sept./Oct. 1998; and the response to Fukuyama by

Barbara Ehrenreich and Katha Pollitt in the Jan./Feb. 

issue.

17 For one example, see Celia W. Dugger, “India’s Poorest 

Becoming Its Loudest,” New York Times, April 25, 199

(Week in Review), p. 3.
U.S. Commission on National Security/21st Century 

14 NEW WORLD COMING

Individuals, too, may confront totally novel

issues, such as how to relate to their grandchildrens’ grandchildren. 

All of this has an international dimension,

as well. Those few Americans who have

recently been able to choose the sex of their

children have preferred females to males, but

the cultural bias in most other parts of the

world, particularly the Far East, is the

opposite.18 If choosing the sex of children

becomes widespread, it could in time create

sharply divergent population profiles in different societies. Moreover, the resentment

toward advanced societies by those farther

behind is likely to grow if, for example,

people in the Near East or Latin America

come to have average life spans several

decades shorter than those in more technologically advanced societies. The lack of

availability of advanced medical technologies

could prove a stimulus for immigration from

the developing world. 

The boundaries of communities and

workplaces will shift, too. As to the

former, virtual communities may replace

actual ones to some extent, the limit defined

by the instinctual human proclivity to sociability and social order.19 If virtual

communities proliferate very widely at the

expense of real ones, then our public space

itself may contract. The Internet, and the

merging of the Internet with commercial entertainment culture, will allow individuals to

virtually select their own news. That may reinforce preexisting biases, and it may narrow

people rather than broaden them, leading

them to be less concerned about society-atlarge rather than more.20 If so, our public

space may shrink, and democracy may be

hollowed out from the inside, even as all of its

outward forms still appear normal. 

On the other hand, local communi

could flourish in reaction to the proliferat

of virtual communities. People who sp

more time at home as they telecommute m

take a greater interest in local concerns 

local politics. That, in turn, could reviv

communities and nurture higher levels of 

litical participation at the grassroots.21

As to the latter, telecommuting will 

make workplaces obsolete, for workpla

have an indissoluble human dimension 

need such a dimension to function effectiv

But it will change how workplaces functio

The fact that many people will be freer to 

farther from a central workplace will a

affect residential patterns, and could have 

nificant implications for land and water u

Closely related, if, as many expect, 

commerce composes half or more of 

commercial transactions before the year 20

there are implications for the spatial and so

compositions of city and suburb. The ratio 

residential to commercial uses of real es

will rise as fewer stores are necessary to 

similar volumes of goods. Labor profiles w

change, too: There will probably be fe

18 Note the data in Nicholas Eberstadt, “Asia Tomorrow, G

and Male,” The National Interest, No. 53 (Fall 1998),

pp. 63-5.

19 See also Francis Fukuyama, The Great Disruption: Hum

Nature and the Reconstitution of Social Order (New Y

Free Press, 1999), and David Whitman, “More Moral,

The New Republic, 22 Feb. 1999, pp. 18-9. 

20 Andrew Shapiro, “The Internet,” Foreign Policy, Summe

1999, p. 25.

21 There are signs that this is already happening in the Unit

States. See Deconstructing Distrust: How Americans 

Government (Washington, DC: Pew Research Center,

1998), pp. 15-6. 

22 Hamish McRae, The World in 2020: Power, Culture, and

Prosperity (Boston: Harvard Business School Press,

1994), p. 179.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

retail clerk jobs in stores, but more delivery,

sales, and inventory management jobs. 

The new economy will transform entertainment culture as well as residential and business

patterns. Here, too, there are implications for

the spatial layout of communities. New places

will allow for new social mixing and new ideas;

new vocabularies will form and new cultural

symbols will evolve. This matters because the

spatial features of community—human geography, so to speak—have always had political

implications.23

Telecommuting, telemarketing, and ecommerce are also parts of a wider reality

that is introducing new patterns into workand marketplaces alike. The ability to bypass

traditional lines of communication has introduced new efficiencies in business—the much

discussed “flat,” non-hierarchical organization. The wealth-producing potential of what

amounts to a new way to use human capital is

enormous, and we have probably seen only

the beginning of it so far.24 But new technological patterns have created a need for

different organizational structures and

processes to allow decision making authorities to function. It has not always been easy to

devise them, nor will it get much easier in the

future. Obviously, a completely flat organization is not an organization at all, but just an

agglomeration. Moreover, what private

business can do, public bureaucracies in democratic countries cannot do as easily, for the

latter do not measure success in keeping the

public trust by standard accounting methods.

Nor can they, or should they, override the

rules of accountability essential to democratic governance.

A related technology-driven issue that

will have an impact on both individuals and

society at large concerns privacy and secrecy.

Privacy will be more difficult to maint

Ever expanding capabilities to monitor in

vidual workers, to intercept messages 

monitor conversations, and to obtain perso

data from databases may conflict with in

vidual rights in democratic countries. Sec

will be difficult to keep—whether individ

business, or governmental—but individu

and organizations will still try hard to k

them. We do not yet know who will win 

race between encryption and decoding, bu

is likely that more basic information will 

available to those who wish others ill. Th

will be a pervasive tension between divulg

information, so that one may benefit from 

social networks of the future, and hold

back information to foil the efforts of th

who would abuse such networks.

As to the physical environment its

the future is likely to bring a mi

picture. No one doubts that human activity 

altered the biosphere. The expansion 

human numbers and habitations has chan

the face of the planet, although there is m

debate over particulars and over the mo

balance inherent in human activity. Pollut

is bad for humans and other animals, 

economic growth lifts people out of mis

and the condition of a life nasty, brutish, 

short. Moreover, the technology of envir

mental remediation is now keeping pace w

the damage that industrialization causes 

advanced countries, and it will be increasi

ly available in developing countries as wel

23 For historical examples, see Michael Vlahos, “Entering t

Infosphere,” Journal of International Affairs, Spring 1

24 For a brief review of the debate over the relationship

between information technology and gains in producti

see Steve Lohr, “Computer Age Gains Respect of

Economists,” New York Times, April 14, 1999,

pp. A1, C14.
U.S. Commission on National Security/21st Century 

16 NEW WORLD COMING

Still, even with advances in remediation

technology, limits to resources are real, including the availability of fresh water as

populations grow. There is also a problem

inherent in sharp reductions in biodiversity

owing to anthropogenic activity.25 These

limits represent a major challenge to posterity.

That said, there is fierce disagreement over

several major environmental issues. Many are

certain that global warming will produce major

social traumas within 25 years, but the scientific evidence does not yet support such a

conclusion. Nor is it clear that recent weather

patterns result from anthropogenic activity as

opposed to natural fluctuations. 

There is no doubt that natural disasters will

roil the future as they have always roiled the

past. It is also clear that as population pressures

and other factors drive large numbers of people

in developing countries to build homes in river

flood plains and coastal areas, the human toll

from such disasters will rise.26 Some 40 of the

50 fastest growing cities in the world are in

earthquake zones. Already half the world’s

population lives in coastal zones prone to

flooding and to the spread of malaria and other

diseases. Environmental refugees now account

for more than half of all refugees worldwide,

and that percentage may grow.27 There is

doubt, however, about the severity of future

trends, depending on how one reads the pace,

depth, and source of climate change. 

Socio-economic borders will also be

stressed by new technologies. The new

requirements of an information-based economy

may create novel social divisions with serious

political implications. For example, international connectivity will allow job competition

over an increasingly wide geographical area.

The good news here is that efficiencies will

rise, and greater efficiency in business translates overall into more wealth in society. But

there is a downside, too. British Telecom n

uses operators located in New Zealand beca

they are wide awake when most people 

snoozing in England; that brings lower c

and greater efficiency to the company 

greater employment pressures in Manche

and Leeds. Such changes are likely to af

white-collar jobs as much or more than b

collar ones that are physically bound t

particular place.

The polarization of work forces is als

potentially serious social issue. Those memb

of society who are not adept at symbol man

ulation may have difficulty adjusting to the n

techno-economic environment. It is not cl

for example, that there will be enough low-s

service jobs for those echelons of the popu

tion that require them for independ

sustenance. If there are not, the sprawling 

very liberally defined American middle clas

and the middle classes of other forme

industrial societies, too—will split, with 

upwardly mobile joining the internatio

cyber-economy and the rest headed tow

more marginal economic domains. 

Moreover, whenever educational segm

tation reflects racial or ethnic segmentation, 

new geography of labor stratification may 

acerbate existing social divisions. This could 

a particularly volatile issue in those societ

including that of the United States, that hav

25 This activity includes the burning of rain forests for sede

tary agriculture, the destruction of estuaries and

mangroves, desertification, and the overuse of pesticid

in conjunction with monocultural methods in agricultu

26 See Steve Lonergan, “The Roles of Environmental

Degradation in Population Displacement,” Environmen

Change and Security Project, The Woodrow Wilson

Center, Issue 4 (Spring 1998), pp. 5-15.

27 International Federation of Red Cross and Red Crescent

Societies, World Disaster Report 1999 (New York: IF

1999).
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

relatively benign history of social mobility.

New technologies may also affect social

patterns related to socio-economic stratification. Already in advanced countries the advent

of automated service devices such as automated tellers at banks and voice mail in offices has

reduced the number of face-to-face encounters

between people of different socio-economic

echelons. The social and political implications

of increased isolation among socio-economic

groups is unclear, but it is not something to be

taken lightly in mass democracies.

Clearly, then, technological drivers will

affect social patterns and raise questions of

social justice. Such questions will doubtless

become major items on the political agendas of

advanced societies. This is already so to some

extent. Over the last several decades there has

been a greater skewing of income distribution

in the United States, as well as in many other

advanced societies. Some blame regressive tax

policies for this, but more likely we have witnessed a technology-driven asset expansion

among the wealthy not different in essence

from the basic economic dynamic of the Gilded

Age. As before, this asset-driven expansion of

wealth is likely in time to generate a wagedriven expansion, and there is some indication

that it already has done so. The democratization

of capital that seems to be inherent in the new

technological environment could also lead to a

greater leveling of income and status amid a

greater prosperity for all. But we do not yet

know how new technologies, and their effects

on domestic and international economic

arrangements, will remix opportunity and

economic achievement in various societies.

Most likely, there will be more polarization in

some domains and less in others.

A concern with social justice is not the only

macro-social area liable to be put to new tests

by technological dynamics. Changes ahead will

threaten all vested interests whose po

resides in the familiarities of the status quo. 

those who have achieved high incomes 

status, the prospect of rapid change can 

threatening, and those who have “made it” v

often have the power to arrest or even de

change—at least for a while. One manifesta

of such fears is the way in which technolog

innovation is often depicted by tenured eli

National politicians extol the promise of 

Internet, for example, and then turn their at

tion to ways of limiting it through regulat

censorship, and taxation. 

Depending on the wider cultural mil

some tenured elites do better at resisting cha

than others. All of this suggests that the cul

wars of advanced societies will shift over tim

new technologies work their way down and 

social patterns. We may stop arguing so m

over abortion, gun control, and the coarsenes

entertainment culture, and more over eviscera

of public space, the ethics of selling synthetic l

forms for profit, and government regulation 

cyberspace. But argue we shall and, as we 

new content will fill the vessels of our polit

vocabulary, changing what it means to be lib

or conservative, progressive or reactionary.

New knowledge-based technolog

could also divide societies in term

basic values. Some unknown percentage 

adults in advanced societies may opt out o

life characterized, in their view, by a fren

pace of cognitive demand, a lack of privacy, 

dissolution of comforting boundaries, and 

misapplications of human priorities. So

citizens will be actively hostile to the new 

berworld, perhaps violently so. 

This suggests that the adversary culture

advanced societies will form new ideologies 

the basis of opposition to the sort of technolo

driven social changes outlined above. One s

such signs already at the fringes of the envir
U.S. Commission on National Security/21st Century 

18 NEW WORLD COMING

mental movements in many technologically

advanced countries. This is a trend likely to

grow in intensity, and it has potential security

implications in the form of eco-terrorism, a taste

of which we have already experienced both in

North America and in Europe. 

While some will rue the new machines, and

while environmental concerns will doubtless

take many forms, others will relish the personal

empowerment that the new technology will

provide to those ready and able to embrace it.

But this, too, poses a potential social challenge,

and one with profound implications for democratic political cultures. The growing sense of

power that will accrue to many individuals, not

to speak of societies and states, as their senses

are extended by technology could corrupt moral

balances and erode moral discipline. If that

were to happen on an extensive basis, it could

undermine the very sources of the cultural

system that has facilitated such individual empowerment in the first place.28 It could threaten

the balance of healthy civic habits that have

long sustained democratic communities.

I

nternational borders will become more

porous, too. States will find it increasingly difficult to prevent the flow of ideas,

economic goods, and dangers into their territories.29 At the interstate level, technology

portends a sharp leveling effect in the ability to

do harm to others across territorial borders. It

will no longer require a major investment in

scientific and industrial infrastructure for small

states and even reasonably well-heeled groups

and individuals, whether they be criminal syndicates or terrorists, to get their hands on very

dangerous technologies.

As important, while all societies will be

exposed to technology and its effects, not all societies will master them equally. While the

implements of new innovations will be more

widely diffused, the benefits may be m

unevenly distributed than ever. Some countr

and groups within countries, will embrace te

nological innovation, while many others wil

through life in a technological environment 

is pre-1940s by Western standards. Thus, n

technologies will divide the world as wel

draw it together. 

This is extremely important for the l

run. All major technological-economic revo

tions have tended to empower some groups 

diminish others. As we move ever deeper in

time of knowledge-based power, those natio

societies, and groups that excel at educa

and human capital generally will find th

selves with daunting relative advantages o

those that do not. This is already obvious 

some respects through the postwar example

Hong Kong, Singapore, and Israel, small 

natural resource-poor places that have nev

theless been able to generate considera

wealth and relative power. This is why edu

tion, as well as social capital and cohesion, 

be increasingly important components 

national power in the future.

In this regard, the Internet may pla

powerful role. On the one hand, the Internet 

considerable potential to spur greater literac

much of world, and to bring knowledge 

millions who might otherwise not have the 

portunity to learn. That is all to the good. B

global Internet culture may also produce 

more half-educated people. The proverb th

little knowledge can be a dangerous thing m

be trite, but that does not make it false. W

one recalls that some of the most danger

leaders, and followers, in the 20th century h

been half-educated men—Stalin, Hitler, M

28 Daniel Bell, The Cultural Contradictions of Capitalism

(New York: Basic Books, 1976).

29 See Human Development Report 1999, United Nations

Development Program, pp. 29-30
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

and Pol Pot come readily to mind—the possibility begins to take on a worrisome dimension.

This is a potential problem not just at the

level of national leadership, but at a level far

deeper in society. The Internet is already full of

information, but not necessarily of knowledge—

and it is utterly unfiltered. For those who lack a

solid basic educational grounding, it is difficult

to distinguish accurate from false information,

serious ideas from half-baked ones, practical

proposals from those both dangerous and

fanciful. After all, any person, even a child, can

use the Internet to visit with “hate” groups, or be

unwittingly influenced by many sundry forms of

unhealthy or just unusual propaganda from any

of the four corners of the earth. It is as easy to get

the Aryan Nation website up on a computer as it

is to load Amazon.com. “Big ideas” hatched

anywhere on earth may rush around the world

far more quickly than ever before—both good

and not so good “big ideas.” The potential for the

growth of an international “know-nothing”

populism cannot be ruled out just because the

web will also facilitate coordination among

groups lobbying for peace and human rights. 

Nor can it be assumed that essentially antimodern forces will abjure using the Internet. In

some Muslim societies, religious fundamentalists are often the first to seize upon modern

techniques of communication to spread their

messages. The quasi-religious martial arts societies of China, though mystical and anti-modern

at heart, may do so as well if their leaders argue

that they need to use technology in order to

“humanize” technology. 

New technologies may also affect the

bonding strength of national identities.

Through the Internet, Americans and other

citizens of technically sophisticated societies

will have far greater exposure to peoples of

other nations, and greater levels of interaction

with them.30 Tourism may become the world’s

largest industry by 2025, as interest in ot

climes and the ease of getting to them b

increase, and the costs of doing so decl

Technology may also allow a near-unive

language translation capability, resulting in 

potential for a far wider exchange of ideas

many countries, this will likely create a gre

sense of something like a global citizen, an

may change dramatically how people iden

themselves and how they see their count

place in the world. Americans, and other tr

tionally patriotic nationals, could come 

develop strong associations both above 

level of existing national identification—tha

the “world citizen”—and below it, with eth

sectarian, or otherwise local commun

symbols. In other words, we may witness 

birth of the post-modern state, a phenome

with potentially huge implications for inter

tional politics.31

This is a crucial uncertainty because m

changes in the global political order h

occurred historically only under two conditio

when the nature of legitimate political u

changes (for example, from empires to nati

states in the 19th and 20th centuries), and w

new values generate the redefinition of perso

identifications and loyalties. It is hard to 

how much eroded the idea of the unit

national state may be over the next qua

century, but the splaying of political asso

tions both upward and downward from the le

of the state is already in evidence in Euro

Skeptics doubt the possibility of building 

economy in order to build a state, and a stat

order to build a nation—which is the logic 

30 See the special issue on the impact of the Internet in the

Indiana Journal of Global Studies, Spring 1998.

31 See James Kurth, “The Post-Modern State,” The Nationa

Interest, No. 28 (Summer 1992); and John Lewis Gad

“Living in Candlestick Park,” The Atlantic Monthly, A

1999, pp. 65-74.
U.S. Commission on National Security/21st Century 

20 NEW WORLD COMING

federated Europe from the European elite point

of view. But what would never have worked in

the old world may work in the new; already

many Germans, Dutch, and Portuguese

younger than age 30 think of themselves as

European as much as they do German, Dutch,

and Portuguese.32 And if it does work, it will do

so largely because, thanks in part to new technologies, the sinews of intersocial

communications will break down existing

cultural as well as economic borders in favor of

new ones.33

Oddly enough, too, but still quite logical,

existing national units are more likely to break

down in circumstances where an overarching

transnational edifice is in place, or is seen to be

coming into being. Thus will forms of integration and fragmentation coexist. The slogan of

the Scottish National Party (SNP), for

example, in this past spring’s first election for

a modern Scottish parliament, was “Scotland

independent in Europe.” The SNP did not win

the day, but in the future it might; and roughly

similar logic applies to places such as Corsica,

Lombardy, Wallonia, Catalonia, and the

Basque country. 

We may also face, as a species, new

ethical and philosophical challenges

to human civilization itself thanks to the

prospects of biotechnology. While biotechnology harbors tremendous potential for good, the

potential for permanent damage to humanity

and the biosphere is also a reality. This technology, for example, will allow for the creation

of ever deadlier and harder to detect weapons

of potentially genocidal dimensions. The

linkage between biotechnology and nanotechnology methods poses dilemmas even more

profound. For example, it will soon be possible

to connect human brain cells to silicon chips.34

It will also be possible to alter more precisely

human behavior through genetic engine

ing.35

While such abilities hold out promis

techniques for healing many mental 

physical illnesses, and for a very advan

form of robotics, it also suggests that the v

constituency of humanity may change—

just from altering the human genome thro

genetic engineering, but also from mixin

with non-organic mechanics. When philo

phers have spoken of the co-evolution of m

and machine, until now they have spo

metaphysically. Notions of “android

“cyborgs,” and “bionic” men and women h

dwelled exclusively in the realm of scie

fiction. But at least the beginnings of such 

pabilities could literally exist within 

lifetime of today’s elementary school child

The implications of such developme

should not be underestimated. Our understa

ing of all human social arrangements is bas

ultimately, on an understanding of hum

nature. If that nature becomes subject to 

nificant alteration through human artifice, t

all such arrangements are thrown into doub

It almost goes without saying, too, that 

delve into such matters raises the deepes

ethical issues: Can humanity trust itself w

32 But still not most, according to the European Commissio

Eurobarometer 50, cited in Dominique Moisi, “Dream

of Europe,” Foreign Policy, Summer 1999, p. 49.

33 See John Newhouse, “Europe’s Rising Regionalism,”

Foreign Affairs, Jan./Feb. 1997.

34 Scientists have already grown brain cells from a rat on a

silicon chip, the result exhibiting certain characteristic

each. A photograph may be found in Business Week’s

special Summer 1999 issue on innovation, p. 106.

35 This has already been achieved with mice. See “Social

Behavior Transformed With One New Gene,” Science

Daily, August 19, 1999, p. 1.

36 Argued by Frances Fukuyama, “Second Thoughts: The L

Man in a Bottle,” The National Interest, No. 56 (Summ

1999).
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

such capabilities? Should it? How can it know

before the fact? Who gets to decide?

There have always been technological

pessimists among us, yet despite the

disruptions of several iterations of major technological innovation over the past few

centuries, the lives of the vast majority are

longer, healthier, happier, and more secure as a

consequence.37 Most likely, the new discoveries and devices of the next quarter century will

also tend to enhance life in quality and

quantity. Still, there is growing unease that we

are upping the ante to the point that a single

mistake or a single act of sheer evil could leave

a potentially fatal wound. So it may be that

mankind will come face to face with technological choices that make us think twice before

we plunge ahead. If so, then we will have

reached a new and higher stage of civilization

in which man as a tool-making animal and

man as a moral being will devise an explicit

reconciliation between these two core facets of

his nature.

Global Economics: “How Is Wealth

Created?”

I

n its essence, economics comes down to

a simple question: How is wealth

created, distributed, and used? But the answer

to that question is anything but simple. We

have moved far beyond undifferentiated subsistence means for making ends meet. Local,

regional, national, and international economic

dynamics have become extraordinarily

complex, involving matters of matching resources, sophisticated production techniques,

education and human capital, marketing,

finance, trade, and the corpus of custom and

law that binds all of these activities together. 

As far as the next 25 years are concerned,

most important in any consideration of U.S.

national security is the extent to which 

global economic system will continue its p

toward integration. That is because such in

gration will affect the distribution 

economic, political, and, ultimately, milit

power in the world. Some countries w

prosper more than others, and some alert 

veloping countries, such as China, m

prosper most of all. 

Continued integration promises gre

wealth for most countries, including 

United States, but it also promises a hos

novel vulnerabilities. If integration stalls o

reversed, however, other problems will co

to the fore. Beyond the broad distribution 

wealth and power, political destabilizat

could arise from the tendency of knowled

based economies to exacerbate divisi

within and among states. Economic inter

pendence will create vulnerabilities for 

U.S. economy. Capital markets and trade m

well be exploited by others for purposes 

odds with U.S. interests. New econo

patterns may also affect national identities 

the capacities of states to govern.

Most observers believe that the in

national economic system is i

state of rapid transition, but they often disag

about where this transition is leading. Tha

partly because outside the domains of pro

sional economists—and sometimes wit

them—prescriptive disagreements shape m

discussions of globalization. Nevertheless

reasonably objective picture of the new glo

economy can be drawn. It requires first a gr

of structural changes in the internatio

economy having to do with its financial 

production dimensions, and how wo

economic cycles are being influenced a

37 The optimist-pessimist debate goes on. See Virginia Post

The Future and Its Enemies (New York: Free Press, 19

which describes the contest as it takes the optimists’ s
U.S. Commission on National Security/21st Century 

22 NEW WORLD COMING

result. It means understanding the connection

between trade and capital flows, especially in

the developing world. And it means understanding the various barriers to economic change. 

A key to the changing global economic environment is the explosion in the volume of

international capital flows. The basic data tell

the tale. In 1990, the first full year of the postBerlin Wall epoch, developing countries

absorbed a little over $100 billion in total longterm capital flows. More than half of these

reflected official aid and assistance from governments or multilateral institutions such as the

World Bank. By 1998, the contrast was stark.

Total long-term capital flows to the developing

world increased to $275 billion. Of that amount,

private capital flows both from international

markets and foreign direct investment accounted for over 80 percent.38

Perhaps as important as the increased capital

flows are the changes in the nature of the private

parties participating in the market, and how they

are doing so. There have been dramatic increases in the numbers and types of participants in the

market, the size of discrete transactions, the

types of instruments and funds involved, and the

overall speed at which trading takes place. Large

commercial banks still play a major role 

global capital flows, and in their volatility. 

the sources of investment have expanded 

include pension and insurance funds as wel

individual portfolios.39 In sum, the global fin

cial system has grown from a small core se

players to a much larger and more disparate 

of investors and creditors. This has created n

vested interests across a wide range 

economic, financial, and political doma

worldwide who are wagering increasingly lar

sums for investment and short-term speculat

Technology has been an important ena

in this development. Advances in informa

technology have made it possible for finan

38 According to the World Bank, international capital mark

consist of bonds, loans, and portfolio equity flows.

Foreign direct investment consists of the sum of equit

capital, reinvestment of earnings, other long-term capi

and short-term capital, as shown in the balance of

payments. Official flows consist of the sum of net flow

long-term debt from official creditors such as multilat

institutions and governments.

39 According to the Organisation for Economic Co-operatio

and Development (OECD), pension fund assets invest

capital markets increased from $4.9 billion to $8.2 bil

between 1990 and 1995. OECD, The World in 2020:

Towards a New Global Age (Paris: OECD, 1997), p. 5

Capital Flows to Developing Countries
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

institutions and individual investors alike to

collect, analyze, and act on information about

markets with unprecedented speed. This trend

will grow because, as the technologies spread,

others around the world will be able to participate in global markets just as ever more

individual and corporate investors in developed

countries like the United States do today. 

Technology has had an even more profound

effect on production itself. Technological

advances have changed the way companies are

being run in terms of operation, size, and

location. On the one hand, it is now possible—

and will become increasingly so—for many

businesses to be truly global. On the other hand,

information technology facilitates the shaping

of specific production to specific markets. This

phenomenon, known as niche production, will

expand in coming years as the diffusion of

knowledge about production techniques, and of

smart machines themselves, merges with a far

more specific and near-instantaneous knowledge of the market. This is true for old product

areas, such as textiles, and for new product

domains that technology itself helps bring into

being. In different ways, the globalizing of

business organization, the expansion of international markets, and the advent of niche

production will force the restructuring of industrial and service sectors alike. It will also tend to

improve standards and quality, and to put a

premium on achieving speed, efficiency, and

knowledge-based processes at every level and

for every kind of business activity.

Information technology has also influenced

inventory strategies, and these too have national

security implications. Inventories are expensive

to carry, and businesses prefer to maintain

lighter loads in that regard. The problem is that

disruptions in supply for whatever reason—not

least war—leave dependent countries vulnerable. For example, should China attempt to seize

Taiwan by force, and in the process cut 

economic links between Taiwan and the Un

States, American industry might well find it

short of important economic components. 

Then there is the Internet, which is revo

tionizing traditional methods of marketing 

distribution. The Internet already provide

novel source of commercial advertisemen

less for particular products than for classes 

products—and its influence in that domain 

grow exponentially over the next qua

century.40 It also lowers the cost of entry to n

markets, facilitating the expansion of sma

enterprises into international business. T

Internet is allowing markets to become tr

global, with fewer middlemen taking profit 

slowing transaction times. Not only is the in

national market becoming larger, it is a

becoming less hierarchical, and that has sign

cant implications for the structure of comme

and competition across both the service and 

dustrial sectors of the global economy.

The integration of the world econo

now afoot is different from ear

episodes of economic integration. First, the r

of trade to global GDP, at least according 

some measures, is at historically high level

States today benefit more from economic in

action with other states than at any other t

in the modern age, and they are also more 

pendent on those interactions to main

40 See Matthew Symonds, “The Net Imperative,” and “Whe

Companies Connect,” The Economist, June 26-July 2,

1999.

41 Trade as a percentage of world GDP approached 15 perc

in 1992. Trade as a percentage of GDP in the pre-Wor

War I era was just over 9 percent. But see Benjamin J

Cohen, “Phoenix Risen: The Resurrection of Global

Finance,” World Politics, January 1996, and Mark

Hallenberg, “Tax Competition in Wilhelmine Germany

and Its Implications for the European Union,” World

Politics, April 1996.
U.S. Commission on National Security/21st Century 

24 NEW WORLD COMING

levels of growth and consumption. An ever

larger number of countries, including the

United States, increasingly relies on imports

for consumer goods, export assembly, and

technology inputs. In addition, the prosperity

of domestic companies, financial institutions,

and individuals is increasingly tied to the

success of overseas operations.

Second, trade is less dominated by the

exchange of commodities and manufacturing,

having spread to include the export of

services. It also now encompasses a far wider

range of the world’s countries. This spreading

of international commerce has been particularly profound in the developing countries,

the traditional suppliers of commodities to

more industrialized states, which have

emerged as important sources for a range of

manufactured goods.42

Third, the cross-border reach of multinational corporations and other business

production networks has accelerated. Large

corporations can create truly global production

networks, seeking out the lowest production

costs worldwide for major components as well

as whole products. U.S.-based corporations are

increasingly shifting their operations overseas,

depending more on global markets for revenues

and production. More important, perhaps,

multinational corporations are increasingly

becoming transnational corporations, the difference being in the extent to which ownership

and the flow of revenues internal to the corporation tend to coalesce at one hub as opposed to

many hubs around the world.

Fourth, stock markets have been created

throughout the world, and many of them have

already become important engines of savings

and investment. The most significant longterm implication of these new equity markets

lies in their capacity to allocate investment resources according to market-based criteria

many countries this is an important new p

nomenon, serving to advance other econo

and also political reforms. 

Fifth, international and multilateral in

tutions hold a prominence in toda

economy unparalleled in the global econo

systems of the past. These institutions are 

sponsible for resolving trade disputes 

designing national financial policies, am

other functions, and these functions w

expand as the global economy becomes 

creasingly integrated.

Sixth, expectations themselves are imp

tant. Large numbers of people in m

countries are well aware of the econo

benefits of a more integrated world. T

have reason to pressure their government

remove impediments, such as barriers to 

inflow of capital, that stand between them 

the presumed benefits of global economic 

tegration. 

Additionally, an increasingly integra

global economy is speeding the spread of in

national best practices. When economies 

linked closely to world financial markets, g

ernments cannot so easily maintain protectio

policies, and they must increasingly respect 

discipline of the market. This is a good thing 

just for bankers and financiers, but also 

ordinary people, who have suffered far m

from bad government than from the herding 

stincts of international investors. 

Taken together, these changes suggest 

important political implication. That so m

people might be spared the miseries 

poverty, and even become downright weal

opens up the possibility of more plura

42 For details, see OECD, The World in 2020, p. 37.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

politics and less violence over more of the

globe. The wealthier a country is and the

deeper its integration into the global

economy, the stronger its incentives to avoid

major conflicts with its neighbors. Of course,

economic logic does not necessarily coincide

with political interests, and states have often

done economically irrational things for political purposes. But such incentives do matter.

I

t would seem, then, that the prospect of

an increasingly integrated global

economy lies before us. The integrative

process, however, is not so simple. There are

several reasons to doubt that global economic

integration will proceed rapidly or smoothly.

It may not even proceed at all, and it may

even retreat in some areas. Let us visit the

possibilities.

Resistance to change can be strong, and

resistance to rapid change stronger still.

Global integration, to the extent that any

society engages in it, necessarily increases its

exposure to market forces through the reduction of trade and investment barriers and the

deregulation of the domestic economy. While

the market tends over time to reallocate resources from less to more productive

endeavors, it also disrupts local communities

and traditional patterns of commerce. It

requires wrenching structural shifts within a

country’s industrial base and employment

profile.43 Alterations in the patterns of wealth

production, and consumption invariably

destabilize the location of social status and

both political and moral authority.44 Since

those who have status and authority are generally reluctant to part with it, some

resistance to change is inevitable.

Resistance to the spread of global

economic integration can take many forms.

One historic form is protectionism. Whereas

the benefits of international trade are gene

the costs are frequently distributed m

narrowly among a country’s less competi

industrial sectors. As an industry feels 

brunt of international competition, polit

pressure is often generated to shelter it. In 

developed world, perceptions that comp

tion with the lower-wage develop

economies will threaten traditional but r

tively uncompetitive industries, and t

cause downward pressure on wages, are lik

to engender protectionist sentiment over 

long term. 

Support for protectionism has also b

developing in the United States, which is 

surprising since free trade and globalizat

are the main reasons for the decline of hi

paying manufacturing jobs. Protection

sentiment has manifested itself in propo

to raise tariffs on imported steel and in op

sition to extending presidential fast-tr

authority in negotiating trade agreements. 

this is occurring at a time of record empl

ment, high growth rates, and ebulli

economic optimism. That poses a troubl

question; as former Labor Secretary Rob

Reich put it: "If free trade inspires this m

antipathy now, when the economy is surgi

43 Some of these shifts are the function of oscillating excha

rates, which make products either cheaper or more de

without any reference to the objective productivity bas

the industry. See Dani Rodrik, “Has Globalization Go

Too Far?” California Management Review, Spring 199

pp. 29-53.

44 Mexico is lately a stellar example, from the banishing of

U.S.-educated technocrats from the upper echelons of

party politics to the largest student strike in 40 years. 

Sam Dillon, “Mexico’s Presidential Hopefuls Are All 

Breed,” New York Times, June 24, 1999; and Julia Pres

“Student Strike in Capital Jarring All of Mexico,” New

York Times, June 25, 1999.
U.S. Commission on National Security/21st Century 

26 NEW WORLD COMING

what will happen when the economy slows,

as it inevitably will?"45

Elements of protectionism can come in multilateral as well as bilateral form. Regional ties

are expanding and serving as a basis for

economic growth, particularly through groupings such as Mercosur, the European Union, and

NAFTA. So far, too, these groupings have

tended to reduce trade barriers not only within

their borders but also, with the exception of

agricultural products, to the world at large.

Nevertheless, should these blocs turn into de

facto regional cartels when times get rough,

world growth would be threatened instead of

boosted. Competing regional trading blocs could

mute, not encourage, the integration of new

markets and resources in the global economy as

a whole. 

We can already see examples of protectionist proclivities within regional trading

blocs. Tensions between the EU and the

former Soviet satellites in eastern and central

Europe owe much to this problem. EU agricultural goods are subsidized and thus bribed

into export to places like Poland and the

Czech Republic, putting great pressure on

Polish and Czech farmers. Meanwhile, many

east European goods are effectively kept out

of EU markets by tariffs and quotas that

specifically target those east European

products that are competitive within EU

markets. Obviously, in such a case trade is

limited as a whole by what amounts to a

regional cartel. 

Culture, too, can be a source of resistance to economic integration.

Resistance to change is liable to be more

vigorous to the extent that the cultural carrier

of that change is thought to be alien and dangerous. The implements of modern technology

are overwhelmingly Western, and many equate

the emerging information society w

American culture. In some societies, and p

ticularly among younger generations, 

culture is widely embraced. In other societ

however, this pop global culture is m

resented, and it often divides generations i

way that irritates and worries national eli

Such resentment is discernable not only am

obviously reactionary forces—say, 

Taliban—but is also widely present in Eur

and in other countries that Americans presu

to be their allies and friends. 

Like it or not, we are entering an era 

global culture conflict, the contours of wh

will be shaped by the pattern of how differ

cultures assimilate new technologies and a

themselves of emerging global econo

patterns. Experience and common sense te

that it is frequently more difficult to acqu

the attitudes—the social software, so 

speak—that underlay a successful o

economy than it is to acquire the capital 

the desire to build one. Just as hopes w

dashed 35 years ago that “technol

transfer” would generate widespread spon

neous indigenous economic growth in 

Third World, so today it takes more tha

technical process for major social innovat

to set roots and succeed.46 Culture matters

with the diffusion of technology, parts of 

world are as likely to be pulled apart 

brought closer together in the process 

global economic integration.

Those peoples who do not benefit from 

more integrated global economy are unlik

45 See Robert B. Reich, “Trading Insecurities,” Financial

Times, May 20, 1999.

46 Note Thomas Sowell, Migrations and Cultures: A World

View (New York: Basic Books, 1996); and Lawrence E

Harrison, “The Cultural Roots of Poverty,” Wall Street

Journal, July 13, 1999.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

to blame their own lack of social capital; they

are more likely to sense conspiracy and feel

resentment. That, in turn, prompts the

question: Can a world half-integrated through

Western techniques and technologies and a

world half-alienated by them stand together in

an era of dissolving borders? If the issue

comes to be not just one of “haves” and “have

nots,” but “wants” and “want nots,” can the

latter successfully spoil the brew for the

former? 

Adeterioration of the security situation

in a given country or region would also

radically affect the economic prospects of that

area—possibly of the whole world if the region

is large or important enough. It almost goes

without saying that war obstructs commerce,

destroys human capital and infrastructure, and

diverts investment from productive to destructive sectors; capital withdraws to safer zones,

undermining development and employment,

thereby creating the conditions for still more instability and violence. Zones of the world that,

for whatever reason, fail to stem the tide of

violence, will fall ever farther behind in the 21st

century. The result will be even greater discrepancies between rich and poor, not just among

regions and countries, but also within them.

Bouts of warfare between major powers would

threaten the entire global economic system. 

A major disruption in global energy

markets could also have a profound impact

on economic growth and integration worldwide. Developing economies will have a

large appetite for energy as they seek to join

the new global economy. Asia’s energy consumption will likely increase over 250

percent between 1996 and 2020.47 The availability of abundant cheap oil from the

Persian Gulf has been the major contributor

to the sustained low prices of the past decade.

If this supply is somehow threatened or

limited, then growth in developing count

could be stymied. Many regimes in the 

veloping world might not survive 

economic shocks resulting from an unsta

oil market. 

Still other discontinuities could af

economic integration. One, possibly 

offshoot of biotechnology gone awry, co

be major unexpected epidemics; anot

could be the further massive spread of AI

to countries such as India or China. Sho

the world face the threat of pandemics, 

bets would be off with respect to project

economic growth rates. Human capital, po

lation distributions, and the econom

interconnectedness of the planet itself co

all shift dramatically. 

Clearly, then, further global econo

integration is not a certainty. Nor 

we assume the absence of a major syste

crisis over the next 25 years. Another ma

“boom-bust” cycle in the developing wo

such as was experienced in 1997-98, co

undermine political support for the mark

based policies upon which the emerg

global economy is based. But of all 

dangers to the new economic arrangeme

we see aborning, the most critical, at least 

the near term, concerns the health of the U

economy.

For the next five to ten years, the con

ued strong performance of the U.S. econo

will be crucial to avoiding a systemic cri

In the aftermath of the financial crisis 

1997-98, the United States is the only ma

economy continuing to experience rob

economic growth. A sharp downturn in 

U.S. economy, were it to occur before 

demand for goods and services picked up 

47 International Energy Outlook 1999 (Washington, DC:

Energy Information Administration, 1999), p. 141.
U.S. Commission on National Security/21st Century 

28 NEW WORLD COMING

nificantly in Europe and Asia, would lead to a

world recession.48 That would radically alter

current rosy projections of U.S. and global prosperity. 

How likely is a severe downturn? Few serious

economists believe that the United States can

maintain its current brisk rate of economic

growth, with little or no inflation, over a 25-year

period. There will be downturns. The crucial

question is how severe they will be, and that in

turn raises the question of what might cause them.

Some experts believe that the current vulnerability of the U.S. economy relates to the

overvaluation of the U.S. stock market and unsustainable levels of consumer spending. Others

disagree, believing that real gains in productivity,

thanks to the cumulative impact of the information revolution, presage a surge of real growth

such that the market may be undervalued. Others

see vulnerabilities in the trade deficit on the one

hand and the capacity of the United States over

time to attract sufficient overseas investment to

finance its national debt. If, for example, real

economic reform in Japan led to greater Japanese

consumer spending, that would reduce the

amount of capital the United States could borrow.

Conjoined to the further development of a euro

bond market, the United States might have to

raise interest rates to attract capital.49 That could

have a serious recessionary impact that might also

affect world growth rates. 

But a “hard landing” is not inevitable. The

U.S. current account deficit is only about 2

percent of GNP, not an extreme number, and

lower than was the case during much of the

1980s. Moreover, the current period of high

deficits has also been a period of high investment.

But if there is a “hard landing”—in which a depreciated U.S. dollar results in a compression of

U.S. imports, lower foreign financing of the U.S.

deficit, and higher domestic interest rates—its

impact on the rest of the world could be consi

able. 

There is a related issue. The global econo

as a whole is dependent on the willingness of 

private capital markets to continue their prim

role in circulating savings from capital rich co

tries to capital poor ones. As it happens, 

majority of the funds in those capital market

now either American money or foreign mo

managed by American firms—although 

could change fairly quickly. Thus, what happ

in the U.S. economy will have an effect on 

willingness and the capacity of private cap

markets to function. Economic conditions in 

world’s major economies, and particularly 

U.S. economy, will still matter most in determ

ing the size and nature of private capital flows

Some further volatility in capital market

likely—how much, no one knows. But if th

were an extended retrenchment of capital fr

developing countries, prospects for econo

growth in many individual countries and 

global economy as a whole would be reduce

Without sustained economic growth, 

prospects for political stability would dim 

many places. While growth cannot solve 

problems, it works well enough as a political 

48 Japan’s economy has already picked up. See Stephanie

Strom, “Japan Grows 1.9%, to Economists’ Disbelief,”

New York Times, June 11, 1999, p. C1.

49 See C. Fred Bergsten, “America and Europe: Clash of

Titans?” Foreign Affairs, March/April 1999.

50 Foreign direct investment is the exception to this. FDI fl

to developing countries dropped less than 5 percent

between the crisis years of 1997 and 1998. Global

Development Finance, p. 14.

51 Capital flows to the developing world have been uneven

distributed. Therefore, since most of the flows have be

concentrated in only a few large developing markets, i

misleading to lump all developing countries together

insofar as the significance of global capital flows is co

cerned.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

liative much of the time. And of course, the

problem is circular: the more social and political

instability, the poorer the economic prospects, and

the poorer the economic prospects, the more political and social instability—at least once people

have gotten a taste of what they are missing. 

But what is most likely to happen?

Continuing global economic integration, a slowing or stalling out of the recent pace of

change, or even retrogression? 

Barring a major disruption of the global

economic or political system, the major trends in

global finance, manufacturing, transportation,

telecommunications, and trade described above

will not be reversed anytime soon. The crossborder web of global networks will deepen and

widen as strategic alliances and affiliates increase

their share of production and profits.52 The internationalization of production networks will also

continue. But the speed at which other parts of the

globe join the integrative process, and the inclusiveness with which countries are transformed as

a result, is likely to be uneven, and in many cases

much slower than anticipated.

What will this imply for the global economic

system of the next century? Savings in the developed world will continue to finance growth in at

least some of the developing world—unless

major countries suck up too much of the world’s

investment capital. The judgments of markets and

key market institutions, such as the major debt

rating services, will remain critical in determining

the size and sustainability of capital flows to all economies, not just to large developing ones such

as Russia, Mexico, and Brazil. As important, the

ability of developing economies to gain access to

these funds will play a major role not only in how

they fare, but also in how advanced ones fare,

because their fortunes are increasingly linked. 

Further global economic integration 

means that there will be global economic grow

a remark that sounds rather banal but, on histor

reflection, is not. Annual economic growth 

several non-OECD economies (Brazil, China, 

India) could average between roughly 5 an

percent. Today’s OECD countries will aver

annual growth between 2 and 3 percent. Thus, 

non-OECD share of world GDP is likely to 

from 44 percent to between 56 and 67 percent, 

pending on whether growth rates tend toward 

higher or lower end of growth predictions. Tha

to its very large population, projected moderat

high growth rates, and a particular method 

making economic comparisons, some have m

the surprising assertion that China’s econo

could overtake that of the United States as 

world’s largest in absolute terms by 2020.53

52 For example, the National Association of Securities Dea

announced in June that it would team up with the

Softbank Corporation to develop an electronic version 

its electronic Nasdaq Stock Market in Japan to trade b

U.S. and Japanese stocks. This will create literally a 2

hour market, and it is only the first of many likely join

enterprises of this sort. See Edward Wyatt, “Market

Place,” New York Times, June 16, 1999, p. C11.

53 In order to make this projection, the OECD uses a metri

comparing countries’ economies called the Purchasing

Power Parity (PPP) standard. PPP is used now for GD

output comparisons by the CIA, the Department of

Commerce, the World Bank, and the IMF as well as b

OECD. While this method avoids the distortions of us

exchange rates to compare economies, it introduces di

tions of its own. For details, see Murray Weidenbaum

“China’s New Economic Scenario: The Future of Sino

American Relations,” Orbis, Spring 1999, pp. 223-4.

More conventional measures suggest that China would

have to grow at an average of 12.4 percent per year fo

years to equal the size of the U.S. economy—obvious

impossibility. Finally, it almost goes without saying th

OECD and other professional institutional estimates o

economic growth have often proven fallible in the pas
U.S. Commission on National Security/21st Century 

30 NEW WORLD COMING

These general trends are hugely important.

For at least the last century, global economic

power and influence have resided in the large

countries of western Europe, North America,

and Japan. The global economic system in

2025, however, will be multipolar. In both low

growth and high growth scenarios, China, India,

and Brazil could become significant economic

centers and attractive export markets for OECD

and non-OECD countries alike.54 This will represent a major realignment in the patterns of

global economic influence and power. Increased

tension is possible in consequence as these

states try to assert their newfound influence in

various arenas. They are bound to want to influence the rule-making processes in international

economic regimes, processes that are dominated

today by the United States and its allies.

Coincident with these likely trends in the

economic future will be ongoing

debates at the regional and international levels

concerning the integration and regulation of this

increasingly complex and still volatile glo

economic system. The volatility of toda

capital markets, well illustrated by recent cr

in Asia, Russia, and Brazil, has led to w

spread demands for a “new finan

architecture.” Such an architecture must m

policymakers’ demands for stability w

market requirements for flexibility, and com

up with an acceptable formula has been trick

We are therefore likely to witness a continu

54 For the purposes of the graphic, Europe is defined as the 

countries of the EU plus Iceland, Norway, and Swede

The high and low growth scenarios differ primarily w

respect to whether trade barriers and export taxes/subs

dies decline to 50 percent or to zero, whether fiscal

consolidation and labor market reforms take place, an

what increases occur in energy efficiency, oil prices, a

population growth. See OECD, The World in 2020, p. 

55 A major new study from the Council on Foreign Relatio

takes a stab at the problem. See Safeguarding Prosper

in a Global Financial System: The Future Internationa

Financial Architecture, Report of an Independent Task

Force (New York: Council on Foreign Relations,

September 1999).

An Emerging Multipolar Economic World

Source: OECD, The World in 2020, p. 92.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

debate over how to keep international capital

flowing, while, at the same time, reducing the

volatility of those flows.

One school of thought likens infant international economic institutions to immature

national ones. According to this argument, we

should expect several sharp fluctuations in international business cycles before the much

more difficult task of coordinating policy

among many countries moves far forward. After

all, the IMF was created at a time when most

experts worried more about managing trade

flows than capital flows and currency fluctuations.56 But others oppose the notion of

regulating international capital flows from

above.57 The more unfettered a market, the

more liable it is to produce both extraordinary

successes and extraordinary excesses. The way

to tilt reality in the former direction, many

argue, is not solely through regulation, but by

forcing actors to learn best practices, and by

exposing them to the penalties of occasionally

getting it wrong. 

This argument will not soon run its course.

Future international financial crises are therefore inevitable; but of what magnitude and

duration we do not know. As for their location,

the developing world is the most likely epicenter, for that is where banking systems and

internal regulatory regimes governing capital

flows are most fragile. Since the pain of disruptions can be severe, the temptation to restrict

capital movements will continue to exist. We

have seen such a temptation at work in

Malaysia’s application of capital controls in

1998. Nevertheless, given the importance of attracting capital for economic development,

attempts to limit the freedom of financial

markets are unlikely to be applied to anything

but short-term capital flows. 

The volatility of capital markets has imp

tant security implications. First of all, 

growing magnitude and nature of capital fl

suggests a potential for ever bigger global wa

in the movement of capital—bigger at their cr

and also bigger at their troughs.58 It is as tho

regional business cycles that were not harm

nious in the past may become so in the future

so, such waves can be large enough to cap

entire governments and destabilize en

regions. Second, and even more important, 

nature of future regulations on capital volati

and how they evolve, will set the tone for h

states interact and for how technology and we

are used. In other words, the process could sh

the results such that getting there—to a new 

ternational economic architecture—could 

nearly tantamount to being there—in a sta

security environment.

Adifferent approach to ameliorating 

negative effects of huge and sud

flows in capital focuses on currency bl

Some experts believe that by 2025 the wo

will be dominated by dollar and euro curre

zones, and that such zones may be an effec

way to allow smaller economies to enjoy 

benefits of increasing global capital mobi

56 Such efforts may go hand in hand with debt reduction fo

developing world, for the size of that debt not only ha

those who owe, but ultimately also those who are owe

See Bob Davis, “G-7 Moves to Revamp Financial

Systems,” Wall Street Journal, June 21, 1999, p. A23.

57 Some even propose abolishing the IMF, whose task has

metastasized since the end of the era of fixed exchang

rates. This includes former Secretary of State and Trea

George Shultz. See his testimony before the Joint

Economic Committee of the U.S. Congress, May 5, 19

58 This is not an entirely new development. The movement 

“hot money” in the 1930s raised similar problems. See

Harry Gelber, Sovereignty Through Interdependence

(London: Klewer Law International, 1997), especially

chapter 2.
U.S. Commission on National Security/21st Century 

32 NEW WORLD COMING

while avoiding some of its hazards.59 Through

the course of the Mexican Peso crisis of 1995

and the 1997-98 financial crisis, fixed exchange

rates became increasingly associated with

damaging exchange-rate volatility. While

even large economies are not immune from

such volatility, the small size of many developing economies’ financial markets—often

no bigger than a regional bank in the United

States—makes it harder for them to avoid

damage in a world of ever increasing capital

flows. Some developing countries may seek

exchange-rate stability by creating currency

boards that fix the exchange rate to a given

currency or basket of currencies. More radically, however, they can join with other

countries to create a new currency (such as

the euro), or they can adopt the currency of

another country, as Panama has done with the

U.S. dollar.60

The widespread implementation of any of

these options would likely signify the de facto

return to a largely fixed exchange rate system.61

But there are problems. Should Argentina

formally adopt the U.S. dollar, for example, as

has been widely discussed in recent months, it

would make the U.S. Federal Reserve the

ultimate arbiter of Argentine monetary policy

and reduce significantly the sovereign power of

the Argentine state.62 The Federal Reserve

bristles at the former now, and the Argentine

government would no doubt bristle at the latter

in the fullness of time.

The debate over currency blocs has only

just begun, and it will probably not end for

many years. That is because, at base, international monetary policy involves a relationship

among three factors—capital mobility, the existence of independent monetary policies, and an

inclination to fixed or at least stable exchange

rates—that seems impervious to permanent settlement. While it is too soon to say how 

currency bloc debate will turn out, it is not 

soon to conclude that it will be a major aren

policy discussion and experimentation over 

next quarter century. 

What will be the implications for U

national security of global econo

shifts? As noted above, these can be summ

up by reference to four basic phenome

greater disparities; increased interdependen

the exploitation of both trade and priv

capital markets for parochial purposes; 

challenges to the identity of nations and he

to the capacities of states to rule them.

The harnessing of ideas, knowledge, 

global resources has the capacity to incre

world economic output tremendously, but w

it will also come greater disparities in we

and income. Such disparaties will app

among countries, with significant implicati

for relative national power.63

Knowledge-based economies will a

continue to create internal divergences in wh

the wealthy, well-educated, and well-pla

will tend to get richer while the poor will t

to stay poor or get poorer. Middle classes, s

as they are, will tend to split.64 This trend is 

cernable already in those countries in 

vanguard of knowledge-based economies. 

59 See Zanny Minton Beddoes, “From the EMU to AMU? 

Case for Regional Currencies,” Foreign Affairs,

July/August 1999, pp. 8-13.

60 “Global Financial Survey,” The Economist, January 30,

1999, p. S15.

61 Ibid.

62 Argentina has already made the Federal Reserve the de f

arbiter of Argentine monetary policy.

63 The key conclusion of the United Nations Human

Development Report, 1999.

64 See Peter F. Drucker, “The Age of Social Transformation

Atlantic Monthly, November 1994.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

roughly twenty years, nearly 60 percent of the

U.S. population has experienced falling real

wages.65 It is also in keeping with recent trends

in economic history, where disparities in per

capita income within developed countries

outpaced those in both economies in transition

and in developing countries.66

Internationally, the pockets of poverty

amid wealth will also be more closely interlaced than is the case today. Some regions of

the world are still almost entirely devoid of the

accoutrements of the information revolution;

the huge and densely populated area within a

circle drawn at a radius of 1,600 miles around

Kabul is a good example. That will almost certainly change over the next 25 years. Once the

world is fully “wired” together, skilled labor

will be far more mobile, both literally and in

terms of who people can choose to work for

from computer stations in their home regions.

Economic disparities will be more visible 

more people, which could be a new source 

frustration and social tension. 

Second, interdependence will characte

relatively open economies, including 

United States. Those U.S. companies, 

vestors, and consumers that depend 

overseas production, imports, and reven

will be implicated by all those events overs

65 For a brief discussion of recent trends, see Laura D’And

Tyson, “Wages and Panic Buttons,” New York Times,

August 3, 1999.

66 As defined by the United Nations, developed countries

include Canada, the United States, the EU, Iceland, Is

Malta, Norway, Switzerland, Australia, New Zealand, 

Japan. Economies in transition include Russia,

Southeastern Europe, the Baltics, the Czech Republic,

Hungary, Poland, and the CIS. Developing countries

include all other countries in Africa, Latin America an

the Caribbean, and Asia, including China.

Per-Capita Income Disparities
U.S. Commission on National Security/21st Century 

34 NEW WORLD COMING

that affect major companies, affiliates, and

suppliers. The key point is that a globalized

economy renders all participating states more

vulnerable to exogenous shocks and disruptions, whatever their sources. The channels of

transmission for such shocks are simply

growing faster than our understanding of

them.

Very much related, as multinational corporations become increasingly international in

character, the link between the corporation

and its country of origin will be rendered more

ambiguous. National governments, including

that of the United States, will be increasingly

subject to competing interests with constituencies that represent cross-border interests and

alliances. Such competing interests could

involve sensitive technology: transnational

companies will seek minimal restriction in

sourcing, selling, and licensing technology

worldwide, but the U.S. and other governments will maintain an interest in controlling

and regulating dual-use technology for

military-security reasons. An already difficult

problem may get worse. 

Even more portentous, as global and

domestic infrastructures become indispensable to modern life, their disruption can have

literally life-threatening consequences. Such

infrastructures, including crucial transportation, health, sanitation, and financial systems,

are bound to become targets of the disgruntled, the envious, and the evil—individuals,

groups, and potentially hostile countries alike.

They will be very difficult targets to defend.

Cyberwar, the attempt to shut down sophisticated systems with sophisticated means, is a

serious threat, well worth worrying about.67

Complex systems can also be disabled by

primitive explosives detonated at the “right”

time and place. And if we turn to genetic engineering to enhance yields from cereal and

other crops, we make those crops uniform

vulnerable to deliberate attempts to r

them—as well as to the lucky insect, fun

or bacterial pest.68

Athird national security prob

concerns the potential exploitation 

the new scale and nature of private cap

markets. The transformation of internatio

financial markets allows governments as w

as companies to raise money in different w

and from different sources than was the c

when governments and commercial ba

supplied the lion’s share of such financ

Since the end of the Cold War, impor

states have taken advantage of this new en

ronment. Russia, for example, has rai

considerable sums through private cap

markets, transfers that have been facilitated 

U.S. policy and international lending inst

tions such as the International Monetary Fu

It is unclear whether the money has hel

advance fundamental reform in Russia; so

believe that it may have hindered reform 

rendering it less urgent. Worse, since mone

fungible, it is possible that funds raised fr

bond offerings in the United States can 

used in ways that violate the spirit of U

laws. 

Even if such activities are not technic

illegal, they can be politically sensit

Clearly, we are entering an era in which ma

67 The White House, “Protecting America’s Critical

Infrastructures: PDD 63,” May 22, 1998; Critical

Infrastructure Assurance Office, White Paper on Critic

Infrastructure Protection, May 1998; and the Marsh

Commission Report itself, called the President’s

Commission on Critical Infrastructure Protection, Crit

Foundations: Protecting America’s Infrastructures

(Washington, DC: GPO, October 1997).

68 For an edifying fright, see Paul Rogers, Simon Whitby, a

Malcolm Dando, “Biological Warfare against Crops,”

Scientific American, June 1999, pp. 70-5.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

“private” financial transactions have major political implications.69 China has issued some

134 bonds in global markets since 1980,

totaling some $26 billion. Of this $26 billion,

$10.5 was dollar-denominated, and of these

nearly 60 percent was offered by just three

entities, all of which may be implicated either

in espionage directed against the United States

or in military activities inimical to U.S.

national security interests.70

The Russian and Chinese governments

have made extensive use of the private market

mainly because that is where most of the

money is. They have done so, as well, because

borrowing from such sources is often less expensive overall, for there are no underlying

trade transactions or projects involved to be

financed. This, in turn, makes it easier to

divert funds for non-productive or even nefarious purposes. Until fairly recently, the use of

private capital markets also made it easier to

avoid conditionality, transparency, investment

discipline, or the provision of collateral

compared to using government-to-government

funds or large commercial banks. Moreover, it

is easier to recruit new sources of funding,

such as insurance companies, pension funds,

and securities firms. 

The use of private financial markets also

enables the cultivation of powerful political

constituencies in both recipient and investor

countries. Many experts have argued that the

“bailout” packages put together for Mexico,

Korea, and Russia have encouraged creditors,

investors, and some private sector borrowers

to think that if they stumble, the governments

of the affected states, along with assorted multilateral institutions, will also bail them out

with public funds and politically motivated

loan forgiveness packages.

The use of private capital markets in 

United States for purposes at variance w

U.S. economic or security interests w

continue. What is less clear is how to deal w

such problems without placing new rest

tions on capital flows. 

Finally, global economic integrat

may bear important implications 

the nature of states and the state system its

Here, too, there is disagreement as to w

those implications might be.

Some believe that the internationalizat

of economic life will affect the very foun

tion of political identity. Commer

organizations are becoming global, it 

argued, and so are the science and technol

bases of those operations and their associa

labor markets. If people’s livelihoods beco

increasingly international in source, it follo

that their sense of emotional attachment to 

state will wane. This will be particularly 

case where there is no obvious physical or i

ological threat at the state level over 

extended period. The implications for ci

military relations, broadly construed, 

hardly be overstated: unless they feel the

selves directly at risk, citizens will not 

69 More accurately, perhaps, re-entering such an era, for th

same phenomenon was common before the present

century. The manner in which Benjamin Disraeli obta

the Suez Canal for Great Britain from the penurious

Khedive Ismail is a picturesque case in point, but only 

of many.

70 Figures are taken from “The National Security Dimensio

of the Global Capital Markets,” remarks of Roger W.

Robinson before the Alaskan World Affairs Council, M

7, 1999; and “Can We Prevent U.S. Credit Flows From

Fueling Russian Proliferation,” remarks of Roger W.

Robinson before the Non-Proliferation Policy Educati

Center, May 19, 1999
U.S. Commission on National Security/21st Century 

36 NEW WORLD COMING

their lives for a state with which they feel little

or no emotional bond.71

While emotional bonds to the state may

erode, demands made upon the state may

increase in an era of great economic and social

dislocation. This will put many states in a

serious bind, with simultaneously less legitimacy from which to draw and less

power to influence increasingly salient

global economic issues. This condition, it

is averred, will come to define the very

crucible of national security policies in

most advanced countries: greater social

demands and expectations with respect to

major economic stresses, combined with less

state influence over the issues at hand. Many

states, it is suggested, will not be able to

survive such conditions, at least not as they are

presently constituted.

How convincing is this view? Parts of it

certainly make sense. It is true, for example,

that most states’ control over economic power

and policy has been reduced from that of the

Cold War era. Six reasons come to mind.72

First, while governments still matter in

economic policy, the private sector now dominates more than ever the sources of economic

growth, employment, and technological innovation. As governments rely more on private

financing and market perceptions, their ability

to manage fiscal policy without imposing

penalties on the cost and availability of capital

decreases. Second, the adoption of international standards that augur for liberalized and

improved regulatory regimes translates into

less capacity for states to manipulate national

economic policy. Third, the pressures of

economic and political decentralization could

push many national governments toward the

further empowerment of local governments.

Fourth, increased economic dependence on

others makes it harder for governments to p

predict, and control their financial futures. 

Fifth, interest groups operating acr

borders, often in broad coalitions, can influe

the strategies of private sector entities as wel

the policies of governments. Already s

private activities—those of the So

Foundation, Amnesty International, Doc

Without Frontiers, Alert International, 

many others—dwarf the organizational and 

nancial capacities of many of the states 

which they operate. Such activity could g

sharply if government regulatory regim

cannot keep pace with business activities

may well be the case in many countries. Cro

border uses of mass action to police busin

activities may grow in rough proportion to 

decline in governmental capabilities. The 

tential exists for millions of individ

decisions to shape the future without the m

ation of existing political institutions.73 Si

most governments will experience contin

pressures to reduce budgets, improve the tra

parency of decision-making, and deve

policies that leverage private sector resour

All else equal, this will make it harder for g

ernments to assist directly in inco

redistribution and provide social safety net

vulnerable segments of their populations.

But will this mean that most states—

even great powers—will necessarily be c

strained from implementing policies t

materially interfere with this growing web 

economic interdependence? No, it will 

Pressures against state authority and con

71 See Peter F. Drucker, “The Global Economy and the Nat

State,” Foreign Affairs, Sept./Oct. 1997, pp. 159-71.

72 See Saskia Sassen, Losing Control? Sovereignty in an Ag

Globalization (New York: Columbia University Press,

1996).

73 Noted in Jean-Marie Guéhenno, “The Impact of

Globalization on Strategy,” Survival, Winter 1998/99.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

may be taken for granted, but states will fight

hard to retain their role as the ultimate arbitrator of sovereign economic policies. They have

done so many times in the past, and usually

successfully. This suggests that the struggle for

new forms of national maintenance and control

will become the key to renewed state power. 

The evidence thus far in our own era

suggests that at least some states have a good

chance to manage the process of economic

change effectively.74 One reason is that societies need them to succeed. The state is, after

all, an expression of political community, with

all its historical and emotional associations, as

well as a vehicle of economic functionality.

Those states that rule over coherent nations

enjoy a store of symbolic capital against which

they can draw. It is thus misleading to read into

a reduction of state prerogatives over economic

issues a reduced role of the state overall, or to

assume that the core principle of state sovereignty is necessarily put at risk by increasing

global economic integration. What does seem

unarguable, however, is that if economic issues

become more important, those states that

manage to master the processes of change will

see their relative international power increase

over those that do not. National power is not the

same as state power, the latter being that share

of the former that governments learn to collect,

manage, and deploy. The formula for translating national power into state power is changing,

but it is not beyond mastery. 

In a way, too, the state’s role in shaping its

domestic environment to achieve market based

economic growth is even more vital in an increasingly integrated global economy than it

has been in the past. The state will be responsible for maintaining appropriate fiscal and

monetary policies, establishing coherent and

market based regulatory regimes, maintaining

social policies that ensure the effective education of its population, and developing 

adequate physical infrastructure. Increasin

caught between local social forces, internati

al business interests, and perceived natio

interests, states will retain their legitimacy 

delivering on their citizens’ expectations 

security and economic prosperity. As imp

tant, those dislocated by new global ma

forces will inevitably turn to the state for h

and the state, if it expresses a true natio

community, will want to respond. All of 

suggests that the role of the state may be dif

ent in future, but not necessarily smaller, fr

what it is today.

It also suggests that a greater polariza

of state power will probably result from 

uneven capacities of states to manage 

control economic change. Regional po

balances may shift and some states might 

tempted to push their new advantages. Oth

may elect to use force preemptively aga

those seen to be rising above the pack. Th

while some vectors suggest that glo

economic integration will bring the wo

closer together, others suggest that it will 

driven farther apart.

Much is at stake in the argument o

how the state will react to glo

economic integration, and much needs sor

out. It is usually assumed in the West 

democracy and free-market economics 

mutually supportive. But the state is the o

secure locus of democracy as we know it. 

what does it mean to say that the future 

beget a world in which states are increasin

beholden to other authorities—that of 

74 See Linda Weiss, The Myth of the Powerless State (Ithac

NY: Cornell University Press, 1998). Weiss analyzes i

detail several case studies, including South Korea, Tai

Japan, Sweden, and Germany, and concludes that state

can learn to reimpose effective governance over econo

policy.
U.S. Commission on National Security/21st Century 

38 NEW WORLD COMING

market, that of transnational organizations—

and at the same time to celebrate the

anticipated expansion and solidification of

democracy that the triumph of market economics ought to support? Could it be that the

liberalization of commerce on the global level

will undermine and not support the spread of

democracy—that one devoutly held Western

principle would work at cross-purposes with

another, equally cherished one? Quite possibly,

yes.

There is plenty that we do not know about

the global economic future, that we cannot

know, and that we will not know in time to

make a policy difference. Clearly, what people

think and do over the next 25 years will determine the answers to most of the questions

raised here. Ultimately, these thoughts will be

political as well as economic in nature, and so

will the acts that produce the world stretched

out ahead of us. And that brings us to the key

questions of society and politics.

The Socio-Political Future: “How Will

the World Be Governed?”

I

ndividuals have historically granted their

allegiance to the state in return for

domestic peace, economic well-being, and

security from external threats. Sometimes they

have done so in the context of a national political community, where the state is an organic

expression of social life among kindred people.

More often these days, states are composed of

more than one ethnic, social, and religious

group, leaving the essential social contract of

government to rely either on more abstract contractual arrangements, such as those exemplified

by the U.S. Constitution, or on more coercive

means of implementation. Sometimes they

survive mainly by the weight of habit.

The point is that there is nothing immuta

about the present arrangements wherein cer

peoples are ruled within certain fixed territo

units. It was not always so in the past, an

may not be so in the future. The ties that bind 

dividual or group loyalty to a state can cha

and even unravel, and the next 25 years port

a good deal of unraveling. 

As illustrated above, new technologies 

change the way that people do business, 

many levels. In some cases, those changes 

enhance international cooperation and regio

integration; in others, they will divide st

and peoples. Many states will lose much 

their control over many economic decisio

limiting the means by which they can prov

domestic economic growth or domestic pe

and security. Violence may increase as di

fected individuals and groups within st

attack the agents of change. And the territo

borders of states will not as easily keep dang

at bay as they once did, given the technolog

advances in weaponry and the global chara

of potential threats. In all cases, the chan

ahead have the potential to undermine the 

thority of states, and the political identities 

loyalties of citizens over the next qua

century will be put through a series of un

nounced, and sometimes undetected, tests.

Many observers think that several st

will not pass such tests. Some suggest that 

principle of state sovereignty itself, and 

the state system, is wasting away.75 The s

ereign state as the key actor in internatio

politics is said to be undermined by all of 

following: globalization, defined as tech

logical connectivity coupled w

transnational economic integration; fr

mented nationalism and a return to tribali

75 Wolfgang H. Reinicke, “Global Public Policy,” Foreign

Affairs, Nov./Dec. 1997, p. 137.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

ecological pressures; international terrorism;

an "outbreak" of stable peace; and more

besides. Of all these, clearly, globalization is

the most widely discussed and debated.

For some, globalization is basically good

not only because it encourages global

economic growth, but because it may be a

vehicle to transcend the system of state sovereignty, seen to be the font of the war-system

that plagues humanity. Globalization thus

represents for some the withering away of the

state by the advent of other means. But others

oppose the sovereignty-eroding elements of

globalization on ideological grounds. Some do

so because the state is the only reliable locus of

political accountability, others because globalization is destructive of local community and

community control, and still others because

they believe that the market theology behind

globalization is being used by the corporate

rich to grow still richer at nearly everyone

else’s expense.76

Evocative as these arguments may be to

some, and as ideologically attractive as they

are to others, the contention that the state is

about to be overwhelmed as the main organizational principle of global politics is not

convincing. The state—whether as multinational empire, nation-state, or any of several

other kinds of political entities that

preceded them both—has never been at

complete equipoise with other social forces.

Its role has ebbed and flowed before other

challenges many times over the years.

Indeed, the centralized state of the 20th

century is an historic anomaly, and those

who foresee the end of the system of sovereign states too often take as their model of

the state a highly centralized and fixed

entity that does not rest comfortably with

historical realities.77 For all the challenges

ahead, the principle of sovereignty, as

vouchsafed within the territorial state, w

remain the key organizing principle of in

national politics for the next quarter cent

and probably for long after that as well. 

That said, the challenges ahead are m

and varied, and they go right to the hear

the core relationships between states, 

among the state, the nation, and the indiv

ual citizen. Even as many states f

diminished control and authority over th

populations, demands on the state are risi

What will this mean for global politics? 

One challenge is demographic 

nature. Populations are growing 

many developing countries. At the sa

time, the populations of nearly all dev

oped countries—and some develop

countries, too, such as China—are rapi

aging.78

As a result of demographic chan

many states will have very different so

balances in 25 years than they do today. La

shortages will bring a rising demand for im

grant workers to older and wealthier societ

accentuating social and cultural tensions. S

the bulk of the dependent population wo

76 Critics of different persuasions include John Gray, False

Dawn: The Delusions of Global Capitalism (London:

Granta, 1998); William Greider, One World, Ready or 

The Manic Logic of Global Capitalism (New York: Si

& Schuster, 1997); and Zygmunt Bauman, Globalizat

The Human Consequences (New York: Columbia

University Press, 1998).

77 Note Peter F. Drucker, “The Rise, Fall and Return of

Pluralism,” Wall Street Journal, June 1, 1999.

78 While today’s ratio of working taxpayers to non-working

pensioners in the developed world is 3:1, in thirty yea

absent reform, the ratio could fall to 1.5:1 or even low

costing an additional 9-16 percent of GDP to finance

benefits for the elderly. Peter G. Peterson, “Gray Daw

The Global Aging Crisis,” Foreign Affairs, Jan./Feb. 1

p. 46.
U.S. Commission on National Security/21st Century 

40 NEW WORLD COMING

wide will remain children rather than the aged.

If these young people are educated and able to

find productive employment, economies will

benefit; if not, social unrest could follow. 

As suggested above, the policies required

for economic growth, especially amid high

population growth, may result in significant

dislocation within a state and directly challenge

long-held political or social values. Economic

growth will frequently be accompanied by

growing disparities in income and wealth, and

those with economic and political influence

will find that influence under siege. This is

bound to generate significant social and political strains within both developed and

developing states. It may also lead to increased

corruption, including among justice and

security officials, which would undermine effective government. Rapid urbanization will

accelerate in many developing countries, as

well, severely straining many states’ ability to

provide basic social services, particula

health care, sanitation, and education.

If these tensions and dislocations are su

ciently severe and prolonged, some states co

unravel. It was no coincidence that the As

crisis of 1997-98 was soon followed not o

by the collapse of the Suharto governmen

Indonesia, but by increased strains on un

Malaysia, too, suffered a political crisis 

nearly led to mass upheaval—and still m

Even such major states as China, In

Pakistan, South Africa, the Democr

Republic of Congo, Kenya, and Mexico—al

which have large and growing population

are not immune from partial or even comp

collapse.79

79 See Secretary of Defense William S. Cohen, Annual Rep

to the President and the Congress, 1999; Edward War

Assistant Secretary of Defense for Strategy and Threa

Reduction, Testimony to the House National Security

Committee, January 29, 1998; and 1998 Strategic

Assessment: Engaging Power for Peace (Washington, 

National Defense University, 1998), pp. 15-6.

Population Growth in the Developing World

Source: U.S. Bureau of the Census, International Data Base.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

But there is also good news. An integrated global information network

may presage the expansion of political pluralism. 

Consider in this regard the collapse of the

Soviet Union. There are many ways to account

for that collapse—not least the effectiveness of

the U.S. strategy of containment over several

administrations. But the inability of a closed

political system to accommodate itself to

economic imperatives based on openness, the

flow of information, and new market demands

was a major complementary factor. If this was

true for an age of television and relatively primitive personal computers, the age of the Internet

may doom nearly all closed political systems to

the ash heap of history. In short, vast new pressures for democratization are likely to be felt

and, where those pressures succeed, it will

make states more responsive to the needs of

their citizens. In most cases, at least, that

suggests both better and more legitimate governance. 

The steady progress in Asia, Africa, and

Latin America in mass education and literacy

also comes into play here. After all, the diffusion of information technology can only carry

social clout to the extent that people can read

and write. As one scholar has put it with re

ence to the Muslim world, “The combinatio

mass education and mass communication

transforming the Muslim majority world. 

Multiple means of communication make 

unilateral control of information and opin

much more difficult than it was in prior e

and foster, albeit inadvertently, a civil soc

of dissent. . . .The result is the collapse of h

archical notions . . . and the emergence of a n

common public space.” The emergence o

civil society is a precondition for genu

democracy, and by “multiplying the possib

ties for creating communities and netwo

among them,” civil society tends to adva

democracy’s way.80

One must be careful here, for literacy d

not guarantee democracy, and mass educa

and authoritarian political styles can co-e

for a long time. Nevertheless, seen together, 

spread of mass communications, br

progress in education and literary, improv

economic well being, and the growth of po

cal liberalism on a global scale have potenti

Population 60 Years and Over

80 Dale Eichelman, “The Coming Transformation of the

Muslim World,” The 1999 Templeton Lecture on Reli

and World Affairs, Foreign Policy Research Institute, 

9, 1999.
U.S. Commission on National Security/21st Century 

42 NEW WORLD COMING

huge implications. Economic logic may also

join with and magnify an important social

impact of 20th century technology. Citizens of

the advanced states are increasingly less

willing to fight or support messy wars partly

because technology has made life much less

risky and frail than it once was. Since life is

no longer so “cheap,” casualties have become

far more expensive.81 The spread of such

characteristics to more of the world could

have a similar effect, the sum being to make

war less frequent and bloody. Some even

believe that, for this and other reasons, major

war will soon become obsolete.82

Acombination of increasing wealth,

personal security, education, and

more widespread democracy may indeed

herald a new era, not one created by grand

treaties and the solemn inauguration of multilateral institutions, but one that grows from

individual hearts and minds. But even if peace

and democracy do not triumph worldwide—

and it is not very likely that they will in the

next 25 years—autocrats and dictators will

find it more difficult to control their citizenry

for a new reason as well as for older ones.

Beyond the inability of authoritarian governments to control the flow of information

within their borders, individuals and groups

will be able to act internationally without reference to the state in a way and at a level

heretofore unimaginable. Mass action across

borders is already establishing new international norms, and there is a good prospect that

non-governmental organizations and grassroots interest groups will have influence

across even those frontiers guarded by authoritarians.83

In democratic states, such developments

may promote stability by facilitating greater

citizen participation in the political and civic

life of the state. Possibly, however, such de

opments can have less than sanguine effe

Democracy can have an illiberal and eve

demagogic side, and new democracies se

prone to aggressive behavior. Pressure 

democracy in heterogeneous states can a

portend their fragmentation into smaller u

that better reflect cultural, ethnic, or religi

identities. Sometimes this fragmentation 

occur without violence, but often enough it 

not—and when it does not, catalytic regio

crises could follow in its wake. Pressures 

democracy in Indonesia contributed to sec

sionist movements in East Timor, Aceh, Ir

Jaya, and the South Molucca Islands. Press

for democracy in China, too, will likely st

independence movements in Tibet and 

Xinxiang province. Not only will there lik

be a wider economic polarization betw

haves and have-nots, but also a wider polar

tion of legitimacy between democratic

governed polities and authoritarian ones.

States unable to provide economic w

being, political liberty, or domestic secu

81 A point nicely put, with some supporting data, in Janna

Malamud Smith, “Now That Risk Has Become Our

Reward,” New York Times, July 25, 1999 (Week in

Review), p. 15. This does not mean that citizens of

advanced societies are casualty averse in any absolute

sense. The data show that most Americans will accept

high casualties if they can be justified on the basis of

threats to key interests. See John Mueller, “The Comm

Sense,” The National Interest, No. 47 (Spring 1997).

82 See, for example, John Mueller, Retreat from Doomsday

The Obsolescence of Major War (New York: Basic Bo

1989), and Michael Mandelbaum, “Is Major War

Obsolete?” Survival, Winter 1998-99.

83 A brief but vivid account, with some examples, is Barba

Crossette, “The Internet Changes Dictatorship’s Rules

New York Times, August 1, 1999 (Week in Review), pp

16. See also Akita Iriye, Cultural Internationalism and

World Order (Baltimore, MD: Johns Hopkins Univers

Press, 1997).
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

for their citizens may also be subject to significant emigration, particularly of their most

educated citizens. Advanced states may need

more technically educated workers, too, the

combination giving rise to unprecedented

levels of emigration among educated elites

from those states that do not work to those

that do. This will make successful states more

diverse and cosmopolitan, and others more

prone to failure.

Clearly, then, there are forces at work

straining the mythic fabric that links

society to the state. Other strains may rend

the link between the individual and the

anchors of authority in society itself. 

During periods of great tumult, people

frequently turn to religion or ideology to

explain change and to gain some psychological security from its disruptions. As noted

above, the dislocations of the Industrial

Revolution helped produce the socialist ideologies of the 19th and 20th centuries. On a

lesser scale, the dislocations of the postWorld War II era in Western societies created

parallel social and political perturbations in

many countries: the undermining of urban

economies; rising divorce, suicide, and crime

rates; and a significant decline in voting and

other forms of political participation.84 It

makes sense, then, to ask what similar reactions we might expect from the tumult in our

collective future, and what those reactions

might mean for state cohesion and effectiveness.

Since different societies begin from different circumstances, their reactions to rapid

change will surely differ. Many in the West

think that its notion of modernity, where the

sacred is privatized and secular values predominate, is a model that other societies must

invariably follow. But this is not so. The replacement for an enfeebled Iranian ro

regime in the 1970s did not come from rad

leftist groups, but from the pre-modern Sh

religious community. So, too, we have see

turn to pre-modern forms in much of 

Muslim world, among some Jews within 

outside of Israel, and within India in the fo

of Hindu nationalism. Pressures toward se

larization inherent in the Western technol

that will flood much of the world over 

next 25 years will not necessarily overco

traditional ways, but might instead reinvi

rate them. One consequence of psycholog

dislocation in individuals may be to dr

them closer to their own social mores, and 

the extent that the state is seen as a legitim

expression of those mores, closer to the s

as well. 

In short, some states may elect not to j

in rapid technological innovation or an in

grated global economy. Among such sta

history will not have ended, and the world 

contending “isms” will remain very m

alive. There is a chance, too, that those sta

might ally to oppose these developme

Geopolitics could become, in essence, a fo

of culture politics.85 The conflicts one mi

expect from such culture politics would 

exactly fit the definition of a religious w

but there could be some striking similariti

Even if secularization does make m

inroads, the vistas along the path will not 

the same in all cases. Every culture 

accepts, or cannot resist, a synthesis of 

old and the new, or between the West and 

rest, will find its own way to cope w

conflict. What seems clear, as well, is that 

84 Fukuyama, The Great Disruption.

85 This possibility is, of course, consonant with Samuel

Huntington’s The Clash of Civilizations and the Rema

of World Order (New York: Simon & Schuster, 1996). 
U.S. Commission on National Security/21st Century 

44 NEW WORLD COMING

dividuals in societies will have more options

as individuals than before. They will have

greater access to other ways of thinking, they

will know more about other cultures than did

preceding generations, and they will have

greater opportunity to experience them firsthand. Hence, it seems likely that in more

cases than ever before, an individual’s or a

group’s identification with the state may be

superseded by other forms of associations

beyond the state, as well as within it in the

form of ethnic, religious, ideological, or tribal

based organizations. 

It also stands to reason that states lacking

a secular cultural and historical heritage will

be particularly vulnerable to the increased

porosity of cultural boundaries. Most modern

Western polities are culturally as well as politically pluralist. Most traditional,

non-secular cultures tend not to be either. 

What are we to make of all this? The

most persuasive conclusion that

emerges from looking at the pressures liable

to be brought to bear on states, and on how

states of different capacities may respond to

those pressures, is that we will have a mosaic

of consequences—as we have always had.

States will differ in various ways, in their

power and influence, their histories, and the

degree to which their citizens give them their

allegiance. They will differ in their economic

development, strength of social and political

institutions, and demographic profile. They

will differ, too, in the extent to which the

national identities in their midst predispose

them to exist as nation-states, as multinational empires, or as stateless nations within an

evolving international system.

The role and characteristics of states in

the next century will depend on how they

respond to the challenges that will confront

all countries. Some will be able to seize te

nological and economic opportunities, w

others will find themselves threatened. So

will be able to establish the regulat

regimes and the social and political in

structure necessary for economic growth, 

some will be able to introduce political in

tutions that are responsive to the n

demands of their citizens. But others will n

Some will wish to resist change but fail, g

nering the worst of all worlds. And perh

most important, only some will find the le

ership they need to guide them through an 

of considerable uncertainty. 

The result will be that some states w

succeed in meeting the multiple challenge

global economic integration—we know 

because some have already found formula

do so.86 Some states will survive, but h

such serious difficulties that their citiz

turn to other groups (ethnic, cultural) to g

allegiance and seek shelter, which will furt

undercut the state’s authority and capacity 

respond to challenges. Some states will dis

pear, and new ones will be formed on 

basis of ethnic, national, or religious ide

ties. Some states will fail, and in failing 

into social and political chaos, export

refugees, famine, disease, and violence acr

neighboring borders.

The ideal of universal human rig

will also challenge the traditio

concept of state sovereignty. A small army 

certain NGOs is carrying forward the old i

that state sovereignty is more a menace to 

dividual human rights than a protector 

them, and this idea is gradually being arm

86 See again Weiss’ The Myth of the Powerless State; and “

Thing That Won’t Go Away,” The Economist, July 31,

1999, pp. 8-10.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

institutionally, most significantly in the

proposal to create an International Criminal

Court. The contentious case of Augusto

Pinochet, too, has illustrated the “spontaneous” evolution of international law toward

views that undermine sovereignty in favor of

undifferentiated human rights criteria. And

while the legal spillover of the NATO military

campaign against Serbia on behalf of the

Kosovar Albanians is still evolving, it may establish a powerful precedent in validating the

ascendancy of the right to self-determination

over that of sovereignty within the United

Nations Charter, which, famously, includes

both.87 Whatever the full range of its motivations, the campaign in Kosovo was the

clearest example in modern times of a major

power or alliance intervening militarily into

the internal affairs of another sovereign state,

avowedly on behalf of minority rights.

Honest people disagree over whether this

is a benign legacy or not. There are those who

believe that a minimally decent world order

cannot arise so long as depredations such as

those of Kosovo can go on with impunity

anywhere in the world. They applaud the

erosion of sovereignty over such questions, as

well as others.88 There are other observers,

however, who point out that international stability depends on respect for the prerogatives

of the state. And many object to Americans

assuming the right to decide unilaterally

when some other country’s behavior exceeds

America’s self-defined moral standards.89

Moreover, others worry that the denaturing of

sovereignty begs the question of who gets to

decide when a depredation is internationally

actionable—in other words, who gets to say

what is and is not a “just war”? Nor is it at all

clear what line of democratic accountability

at the transnational level will substitute for

that of the state.90 Can a host of international

civil servants, professional human rights l

byists and lawyers, and aid organizat

trustees—formally accountable to no on

really be trusted to know what is best in ev

case, or any case?

This is a question recently born as fa

the history of international relations goes

will mature rapidly over the next 25 years

will several others. For example, it m

become necessary to design some sort of le

personality for political entities that are 

than states but more than mere groups of 

dividuals—such as Kosovo and the Kurd

areas of northern Iraq. If we are to see m

efforts by minorities to establish zones 

autonomy for themselves, as seems lik

then how will an increasingly salient num

of non-national institutions, such as the Wo

Bank, the International Criminal Co

(should one come into being), or UNESC

deal with such ambiguous entities? 

In any event, there is little doubt 

transnational actors of other sorts will grow 

number over the next 25 years. Some will r

resent positive responses to technologi

economic, and political challenges (multi

tional corporations, non-governmen

organizations) and others negative respon

(drug cartels, terrorist networks, and crim

87 Chapter 1, Article 1, paragraph 2, as opposed to Chapter 

Article 2, paragraph 7.

88 See Marianne Heiberg, ed., Subduing Sovereignty:

Sovereignty and the Right to Intervene (London: Pinte

1994). 

89 See Samuel Huntington, “The Lonely Superpower,” Fore

Affairs, March/April 1999; and David Sanger, “Ameri

Finds It’s Lonely At the Top,” New York Times, July 1

1999 (Week in Review), p. 1.

90 Some of these issues are discussed in David Rieff, “The

Precarious Triumph of Human Rights,” New York Time

Magazine, August 8, 1999.
U.S. Commission on National Security/21st Century 

46 NEW WORLD COMING

cells). In some cases, these latter groups will

take on certain aspects of statehood, controlling territory, levying taxes, even raising

armies. 

States will also find themselves in need of

cooperation with other states, if they are to

seize the opportunities presented by global

changes and respond to the dangers. Of this

we may be sure. What we do not know is

whether and how regional groupings of

various sorts may emerge, and with what

kinds of responsibilities and authorities. We

do not know whether the United Nations and

other global political institutions will

continue to exist as creatures of states, or

whether they will be empowered to act in

certain areas in place of states. We do not

know whether regional or global regimes will

be established to prevent the spread of dangerous technologies and weapons, and if they

will have the authority and ability to enforce

their mandates. 

This is a lot not to know, and there is

yet more. At the risk of seeming

quaint, it behooves us to note a final uncertainty. Not all of what befalls the world of

states over the next quarter century will be a

function of how leaderships and populations

adjust to the challenges of new technologies

or accelerating global economic integration.

The beginning of wisdom is perhaps to recognize that what counts is not only what is

changing, but also what is not. There is still

the old-fashioned problem of geopolitics, and

nowhere does this problem look clearer—and

more dangerous—than in the Pacific rim,

where the triangular relationship between

Chinese, Koreans, and Japanese holds the key

to peace or war. 

Within the logic of geopolitics is the unpredictability of personality and the

happenstance of illness and death am

leaders. Not every historian is convinced, 

most believe that had it not been for 

hypnotic political skills of Adolph Hit

World War II would never have happen

While Hitler is the 20th century’s m

obvious example of evil enthroned, hist

bears other examples from this century 

other centuries, too. It is not possible to r

out the rise of “crazy states”91 with psyc

logically aberrant or evil leaders in the futu

and the shock to the system that such a lea

can produce should never be underestima

In the future, it may be that, with weapon

mass destruction more widely available, e

the unglued leader of a relatively small s

will exceed the threshold of danger to 

system as a whole. 

The Military-Security Domain: “H

Will Societies Protect Themselves?”

The military-security environment 

the next 25 years will be shaped b

unique and substantially unfamiliar set of 

litical, economic, technological, social, 

cultural forces described elsewhere in 

study. As in the past, conflict will be dri

by perturbations in the political order, so

dislocation, passionately held beli

economic competition, and cultural divisi

In this section, however, the purely milit

and security dimensions of the future 

brought into focus. Societies will still need 

protect themselves in 2025, and they w

have to do so against an unprecedented ra

of threats and actors. 

As with most periods of rapid chan

both the actors and the means by wh

91 Yehezkel Dror, Crazy States: A Counterconventional Stra

(Lexington, MA: Heath Lexington Books, 1971).
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

violence is used in pursuit of political goals

may shift abruptly. Non-state actors, individuals as well as groups, will gain power and

influence, and many will have at their

disposal alarming means of destruction.

Many states may see the coherence of

national identification lose its grip at the individual level, with critical implications for

their ability to mobilize and fight, as well as

for the structure of their civil-military relations.

Even in a world in which major wars are

less frequent, and in which growing prosperity adds incentive for the peaceful resolution

of disputes, there will still be enough unsettling change to touch off any number of wars,

internal upheavals, incidents of terrorism, and

general mayhem. The end of the Cold War did

not mean the end of all conflict and, with a

decade to ponder the emerging evidence, no

sentient person can doubt the potential lethality of future conflict. 

We explore these trends and patterns in

three parts. First, we look at what sorts of

states, groups, or individuals will incline to

use force. Second, we look at what kinds of

military capabilities are likely to be on the

loose for such use. And third, we look at the

environment likely to be formed by the conjunction of the two.

I

nterstate wars will not disappear over

the next 25 years.92 Developed nations

will be loath to fight each other, but as proven

in 1914, neither the bonds of interdependence

nor a taste for affluence can guarantee peace

and stability indefinitely. Major powers—

Russia and China are two obvious

examples—may wish to extend their regional

influence by force or the threat of force.

Conflicts among old adversaries may

continue, such as between India and

Pakistan.93 Misperception or miscalculat

will remain possibilities and both may be 

acerbated by the introduction of new milit

technologies. Conflicts could arise out 

efforts to right perceived wrongs or to gai

trategic advantage, and wars will still 

fought over disputed borders, resources, 

irredentist claims. The history of the 19

remains instructive, too, for the reversion 

assertive nationalism by leaders faced w

unsettled social and economic condition

not beyond imagination. Conventional wa

ships, tanks, and planes—will remain 

most relevant modus operandi for most 

these conflicts. 

Violence within states, on the other ha

could reach unprecedented levels. Genera

by ethnic, tribal, and religious cleavages, 

exacerbated by economic fragmentation 

demographic shifts, such violence will fo

by far the most common type of conflic

the next quarter century. Brutish, nasty, 

necessarily short, and potentially genocida

scope, these conflicts—mostly but 

entirely in non-Western domains—co

result in major disruptions, killing hundr

of thousands of people each yea

Undisciplined tribal or ethnic based param

tary groups will often be the primary age

of such conflicts, which will involve sold

and civilians alike. They may also take pl

92 See the arguments in “Is Major War Obsolete: An

Exchange,” Survival, Summer 1999, pp. 139-52.

93 As noted below, a war involving India, Pakistan, and

possibly Iran is not so very unlikely, but analysts diffe

over whether such powers should be defined as “majo

94 Not that the toll from such wars is vastly different now f

Cold War times, despite a common perception to the

contrary. See Yahya Sadowski, The Myth of Global Ch

(Washington, DC: Brookings INstitutino Press, 1998)

121; and Shashi Tharoor, “The Future of Civil Conflic

World Policy Journal, Spring 1999, pp. 1-11.
U.S. Commission on National Security/21st Century 

48 NEW WORLD COMING

in urban areas or in other terrain that tends to

neutralize the current technological advantages

of modern militaries. 

While such conflicts need not disrupt the

core strategic interests of major powers, they

will do so if they trigger larger interstate conflicts, grossly violate internationally accepted

norms, or create massive flows of refugees,

disease, and environmental degradation. The

latter is particularly likely since such conflicts

often generate humanitarian disasters that are

hard to ignore in an age of mass communications. Yet major powers cannot intervene for

humanitarian purposes without also intervening

in the underlying politics that create such

troubles in the first place. The Somalias,

Bosnias, Rwandas, Kosovos, and Haitis of the

world will not disappear, and neither will the

dilemmas they pose. 

There will also be a greater probability

of a far more insidious kind of violence

in the next millennium: catastrophic terrorism.95 While terrorism itself is nothing new, the

nature of terrorism and the means available to

tomorrow’s terrorists are changing. 

Future terrorists will probably be even less

hierarchically organized, and yet better networked, than they are today. Their diffuse

nature will make them more anonymous, yet

their ability to coordinate mass effects on a

global basis will increase. Teamed with states

in a regional contingency, they could become

the “ultimate fifth column.”96 Terrorism will

appeal to many weak states as an attractive

asymmetric option to blunt the influence of

major powers. Hence, state-sponsored terrorist

attacks are at least as likely, if not more so, than

attacks by independent, unaffiliated terrorist

groups. Still, there will be a greater incidence

of ad hoc cells and individuals, often moved by

religious zeal, seemingly irrational cultish

beliefs, or seething resentment. Terrorists 

now exploit technologies that were once 

sole preserve of major states and pose atta

against large domestic population centers. 

The growing resentment against Wes

culture and values in some parts of the worl

as well as the fact that others often perceive 

United States as exercising its power with a

gance and self-absorption—is breeding 

backlash that can take many forms. Terrori

95 Government studies on this topic include: Combating

Proliferation of Weapons of Mass Destruction, Report 

the Commission to Assess the Organization of the Fed

Government to Combat the Proliferation of Weapons o

Mass Destruction, July 14, 1999; “Executive Summar

Report of the Commission to Assess the Ballistic Miss

Threat to the United States, July 15, 1998; Transformi

Defense: National Security in the 21st Century, Repor

the National Defense Panel, December 1997; and W.

Cohen, Proliferation: Threat and Response, OSD Rep

to Congress, November 1997. Major private research

studies include: Fred C. Iklé, Homeland Defense

(Washington, DC: CSIS, 1999); and William Webster, 

al., Wild Atom: Nuclear Terrorism (Washington, DC:

CSIS, 1998). Key periodical literature includes: Fred C

Iklé, “The Problem of the Next Lenin,” The National

Interest, No. 46, Spring 1997; and Walter Laqueur, “T

New Face of Terrorism,” The Washington Quarterly,

Autumn 1998. Recent books include: Joshua Lederbe

ed., Biological Weapons: Limiting the Threat (Cambri

MA: MIT Press, 1999); Richard Danzig and Pamela

Berkowsky, Biological Weapons—Limiting the Threat

(Cambridge, MA: MIT Press, 1999); Jessica Stern, Th

Ultimate Terrorists (Cambridge, MA: Harvard Univer

Press, 1999); Richard A. Falkenrath, et al., America’s

Achilles’ Heel (Cambridge, MA: MIT Press, 1998); Ph

B. Heyman, Terrorism and America: A Commonsense

Strategy for a Democratic Society (Cambridge: MIT P

1998); Ken Alibeck with Stephen Handelman, Biohaz

The Chilling True Story of the Largest Covert Biologic

Weapons Program in the World (New York: Random

House, 1999), and Bruce Hoffman, Inside Terrorism (

York: Columbia University Press, 1998).

96 Hoffman, Inside Terrorism, p. 196.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

however, appears to be the most potentially

lethal of such forms. Therefore, the United

States should assume that it will be a target of

terrorist attacks against its homeland using

weapons of mass destruction.97 The United

States will be vulnerable to such strikes.

I

f that were not a sobering enough

prospect, most advanced conventional

military weapons and systems will also be

more broadly distributed between now and

2025. Domestic political and economic incentives will lead to the development and sales of

advanced aircraft, modern ground fighting

vehicles, and new naval systems throughout the

world. Only cutting-edge systems will remain

closely held.

It is not even clear whether the major arms

exporters will cooperate to prevent the sales of

such weapons systems to states and other

groups that pose major potential threats to

regional stability and peace. A minimal export

control regime already in operation, the

Wassenaar Arrangement, could be enhanced,

but this depends on the positive evolution of the

international political climate. It also depends

to some degree on the ability of the exporting

states to find alternatives to legacy industries

still heavily in the business of manufacturing

weapons. 

Conventional weapons systems will be characterized by an increasing emphasis on speed,

stealth, lethality, accuracy, range, and networked

operations. The era of Industrial Age platforms

operating with impunity in the open may become

outdated, as long-range precision capabilities

proliferate in all dimensions of warfare (air, sea,

and land).98 There will be a greater premium on

highly integrated and rapidly deployable forces.

The age-old interaction of capabilities and

counter-measures will continue, of course, and

physics probably favors detection and the

ultimate demise of stealthy systems and la

platforms. But “ultimate” can mean a long ti

and, as opponents try to defeat existing U.S. te

nologies, new technologies and ways 

employing these weapons will abet the contin

tion of current U.S. advantages. The widespr

adoption of MEMs into U.S. military technolo

for example, may provide significant new qu

tative advantages over a broad range 

capability. New intelligence capabilities deri

from biotechnology, including the use of ins

for selected purposes, may also be at hand. 

Nonetheless, many states will pur

strategies to acquire today’s modern weapo

These weapons will no longer be cutting-e

technology by the 2015-2025 timeframe, 

they may be widely available and, in local w

could prove decisive.99 Just as likely, the r

tively rapid spread of modern conventio

weapons could destabilize several trou

zones and make regional wars both more lik

and far more destructive.100 The acquisition 

such weapons will probably be pursued w

alacrity by military regimes and other regim

97 See Ian O. Lesser, Bruce Hoffman, John Arquilla, David

Ronfeldt, and Michele Zanini, Countering the New

Terrorism (Santa Monica, CA: RAND, 1999); and Zal

Khalilzad, David Shlapak, and Ann Flanagan, “Overv

of the Future Security Environment,” Sources of Confl

in the 21st Century: Regional Futures and U.S. Strateg

Zalmay Khalilzad and Ian O. Lesser, eds. (Santa Mon

CA: RAND, 1998).

98 See Michael G. Vickers, Warfare in 2020: A Primer

(Washington, DC: Center for Strategic and Budgetary

Assessments, 1996).

99 Obtaining equipment is one thing, assimilating it intellig

ly is another. See Chris C. Demchak, Military

Organizations, Complex Machines: Modernization in 

U.S. Armed Services (Ithaca, NY: Cornell University

Press, 1991).

100 See John Weltman, World Politics and the Evolution of 

(Baltimore, MD: Johns Hopkins University Press, 199
U.S. Commission on National Security/21st Century 

50 NEW WORLD COMING

for whom robust military capabilities play a

major role in internal security.

While the market for 20th century conventional weapons will remain brisk, some

important states will choose acquisition strategies to compete asymmetrically against major

powers. These potential adversaries will invest

in relatively inexpensive systems intended to

deny the United States the advantages that naturally accrue with technological superiority.

Weapons of mass destruction would serve this

purpose.101 Developing such weapons does not

require a large industrial base or extensive scientific research support as it once did. The

international norms against the spread of these

weapons are being challenged, and the global

export control regimes covering nuclear,

chemical, and biological weapons will not effectively keep them from state and non-state

actors that are determined to acquire them.102

Some countries will supply these weapons, or

components for them, for commercial and political purposes. Problems will also exist in

ensuring the security of these weapons and

weapons components in individual countries.

The extent to which nuclear, biological, and chemical weapons will be

developed and used will depend on a variety

of factors. Nuclear materials and technology

are available, but the cost of producing

nuclear weapons is high, as are the risks of

detection. The development and use of radiological weapons would be easier and cheaper.

By pairing conventional explosives with radioactive materials like plutonium, such a

weapon could generate both a major explosion and contaminate a large surrounding area

for an extended period. 

Chemical weapons are much easier to

produce than nuclear and radiological

weapons, but they are harder to store and use

effectively. Their effectiveness is subjec

uncontrollable climatic elements and 

lethality of chemical weapons per unit 

weight is generally low.103 This ma

chemical weapons generally suitable for 

in attacking conventional armies concentra

in the field, or against small groups of 

prised or immobile civilian populations. 

such weapons are unlikely to be a prefer

tool for terrorizing entire cities. 

Biological weapons are the most lik

choice of means for disaffected states 

groups of the 21st century. They are nearly 

easy to develop as chemical weapons, they 

far more lethal, and they are likely to beco

easier to deliver.104 At present, many biolo

cal agents require special technical expertis

distribute them effectively, such as dr

aircraft that are capable of dispersing agent

the right concentrations at the right altitudes 

under the right meteorological conditions. T

is not simple, as extensive but unimpres

Iraqi efforts in the 1990s have shown. On 

other hand, given enough time, perfect

methods of dispersal will take far less techn

sophistication than that required to buil

nuclear bomb. 

Moreover, bio-weapons can be produce

small, dual-use facilities, and then reprodu

101 Cohen, “Preparing for a Grave New World.”

102 SECDEF address at the Conference on Terrorism, Weap

of Mass Destruction, and U.S. Strategy, University of

Georgia, April 28, 1997; SECDEF News Conference,

Release of OSD Report on WMD Proliferation, Novem

25, 1997; SECDEF Annual Report to the President an

Congress, March 1998, p. 26; and Acting CIA Directo

George Tenet, Testimony to the Senate Armed Service

Committee, February 5, 1997.

103 There are some exceptions, VX being the most importa

104 Weight for weight, microbial agents such as anthrax are

thousands of times more potent than nerve gasses such 

sarin. Lederberg, p. 286.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

in mass quantities using technologies and procedures common to micro-breweries and

civilian pharmaceutical labs. A bio-weapon

arsenal can be acquired for as little as $10,000-

$100,000.105 Several countries are pursuing

biological agents, and some are getting help

from outside their borders. Biological weapons

experts formerly employed by the Soviet Union

have testified that the extent of the Soviet

program was massive, but that control of the

physical and intellectual assets of the former

program is virtually nonexistent. Accordingly,

a variety of improved toxins and biological

agents are becoming more widely available.

Technological developments in genetics and

biotechnology portend even more sinister

advances with the design and deployment of

genetically engineered pathogens that could

thwart most antibiotics and vaccines, and

readily outcycle our detection, antidote development, and distribution timelines. These could

include genetically-altered smallpox.106

Given such circumstances, the prevention

of the proliferation of biological weapons

through treaties and a regime of export controls

is unlikely to be effective. A Biological

Weapons Convention (officially, the Convention

on the Prohibition of the Development,

Production and Stockpiling of Bacteriological

[Biological] Toxin Weapons and on Their

Destruction) has been signed and ratified by 140

countries. But since the treaty was open to signature in April 1972, the number of countries

known to have or suspected of having biological

weapons has doubled.107 The BWC has no enforcement or inspection mechanism, although

negotiations are underway to provide for them.

U.S. deterrence policy will remain effective against acknowledged nuclear states, and

the deliberate use of these weapons will

remain a low probability. But as other states

acquire nuclear weapons, that probability will

likely increase. Whether states take such a s

will be a function of many factors, prima

related to the threats they see within their o

region. The literal costs of developing nuc

weapons, the political costs associated w

their use, and the difficulty of hiding their 

velopment, make them less likely to emerg

a primary instrument of state policy. S

given their vast destructive power, the Un

States will continue to deal with the th

posed by nuclear weapons throughout the n

25 years. There will be no abolition, and e

the existence of the Non-Proliferation Tre

and wide ratification of test ban treaties w

not significantly reduce the problem.

Non-state actors will also use th

weapons in direct attacks. Such attacks exp

the Achilles’ heel of the modern world. 

open societies are vulnerable to extensive p

chological and physical harm from weapon

mass destruction. The potential for cov

delivery of these sinister products will be h

much higher than during the last half cent

Covert threats are more likely than overt o

since they avoid easy attribution and he

likely reprisal. The immense lethality, portabi

and accessibility of WMD will be major sour

of concern over the whole of the next qua

century.

Missile threats will also continue to p

liferate. While the regime of mis

producers, known as the Missile Technol

Control Regime (MTCR), will survive and m

105 Falkenrath et al., p. 112.

106 See Richard Preston, “The Demon in the Freezer,” The 

Yorker, July 12, 1999, pp. 44-61.

107 J.D. Holum, Remarks for the Fourth Review Conferenc

the Biological Weapons Convention (Geneva: U.S. Arm

Control and Disarmament Agency, November 26, 199

See also Robert P. Kadlec, Allan P. Zelicoff, and Ann 

Vrtas, “Biological Weapons Control: Prospects and

Implications for the Future,” in Lederberg, pp. 95-111
U.S. Commission on National Security/21st Century 

52 NEW WORLD COMING

be strengthened, it is becoming increasingly easy

for states not party to the MTCR to master the

technology necessary for such production. If Iran,

Iraq, North Korea, Pakistan, and India can foil the

best efforts of the MTCR, the prospect is that even

less technologically sophisticated states may be

able to do so in future. 

Ballistic and cruise missiles are liable to be

the long-range weapons of choice, given their capabilities to threaten land and sea targets from

afar. The accuracy and lethality of such systems

will increase significantly between now and 2025,

even for the delivery of conventional ordnance.108

The competition between missile developments

and defensive systems will be a key operational

challenge over the next several decades. Largescale missile attacks will be able to overwhelm

defensive systems, despite considerable improvements to them. American bases abroad will

become vulnerable to these weapons.109

Additionally, a number of new lethal and nonlethal technologies will be developed and fielded,

including microwave, directed energy, and

chemical/biological agents that could give small

powers the ability to thwart power projection operations by any major power. 

In addition to “traditional” weapons of mass

destruction, new forms of Strategic Information

Warfare (SIW) will be developed and perhaps

used as a new form of offensive warfare. SIW

involves cyber-attacks against major national

command systems and military-related operating

systems.110 Bytes will not replace bullets and

bombs in conflict, but those who cannot match

the conventional strength of major powers will

have strong incentives for such asymmetric

attacks. Given that the commercial world, not

governments, is developing these technologies,

and that military telecommunications are heavily

dependent on commercial access, the potential

exists for serious disruption of routine military

operations in both peacetime and war. The

United States and its allies are particularly vulnerable to such methods since our econom

and military forces are heavily, and increasin

reliant on advanced information technolog

While countermeasures can be developed, 

new form of warfare will be an important par

the military landscape for some time. 

In addition to weapons of mass destruct

there is a new concept—the “weapon of m

disruption”—to which modern societies, ra

than their militaries, are increasingly vuln

ble.111 As noted above, the computational 

information processing capacities generated 

the computer revolution are critical to modern 

nancial, banking, energy, telecommunicatio

medical, and transportation networks. The hea

welfare, and prosperity of the citizens of the 

veloped world depend upon this infrastruct

But that infrastructure is an enticing target to 

affected states and terrorists, who can achi

almost as much damage with a keyboard as w

a bomb. Imagine, for example, a well-plan

108 Center for Counterproliferation Research, The NBC Th

in 2025 (Washington, DC: National Defense Universit

1997).

109 See Paul Bracken, “America’s Maginot Line,” The Atla

Monthly, December 1998, pp. 85-93; and Paul Kugler

Changes Ahead: Future Directions for the U.S. Overs

Military Presence (Santa Monica, CA: RAND, 1998).

110 See Frank J. Cilluffo, et al., Cybercrime, Cyberterrorism

Cyberwarfare....Averting an Electronic Waterloo

(Washington, DC: CSIS, 1998); and Roger C. Moland

Peter A. Wilson and Robert H. Anderson, "U.S. Strate

Vulnerabilities: Threats Against Society," in Zalmay M

Khalilzad and John P. White, Strategic Appraisal: The

Changing Role of Information in Warfare (Washington

DC: RAND, 1999), pp. 253-80.

111 Including the United States. See Preparing for the 21st

Century, Commission on the Roles and Capabilities o

United States Intelligence Community, 1996, p. 27;

Organisation for Economic Cooperation and Developm

21st Century Technologies—Promises and Perils of a

Dynamic Future (Paris: OECD, 1998), pp. 14-5; and

Walter B. Wriston, “Bits, Bytes, and Diplomacy,” Fore

Affairs, September/October 1997, p. 172.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

attack against the air-traffic control network on

the east coast of the United States as more than

200 commercial aircraft are trying to land in rain

and fog on any given weekday morning. 

Numerous incidents of computer penetration

have already occurred, often mounted by

teenagers using relatively unsophisticated

systems. Better educated or well-financed

“automata assassins” could do far more damage,

especially if they are abetted by insider personnel. A plethora of new tactics and techniques to

“infovade” critical systems now exist. Modern

hacker techniques such as “sniffers,” logic

bombs, mutating viruses, and Trojan horses, are

increasingly common. The innate complexity

and connected nature of information-based

systems generate opportunities for hackers, terrorists, or antagonistic states to cause mischief

and harm. Our increased reliance on these information systems ensures that disruption to them

will create serious dislocations within our

society. No nation in the world is more vulnerable in this regard, or has more to lose, than the

United States.

Outer space, as well as cyberspace, will

become a warfare environment. Spacebased systems are increasingly critical to both

international commerce and military capabilities.

By the early 21st century, such systems will offer

such an invaluable advantage that continued

access to space will be considered synonymous

with national security. Space access will become

as important as access to the open seas was for

major powers in the 18th, 19th, and 20th centuries.

Not surprisingly, therefore, there are complications ahead. 

The benefits to global commerce derived

from space have vastly increased investment in

space technology and expertise, a trend that will

no doubt continue. The national security implications of such investments are dramatic.112 With

more than $100 billion invested today, the United

States has a clear economic interest in ensuring

its own continued access to space.113 But 

number of states and groups capable of expl

ing space as an environment is expanding a

result of commercialization. More than t

thirds of today’s 600 satellites are foreign-own

and of the more than 1,500 new vehicles that 

be launched over the next decade, most wil

internationally owned or operated by vari

consortia. This raises a major intelligence c

lenge, for, as space systems proliferate, it wil

more difficult to determine their capabilities 

who has access to their data.

Since satellites are the ultimate pre-p

tioned asset and, because they are so centra

military operations, what happens in space 

be critical.114 Most likely, weapons will 

deployed in space. Some systems may 

capable of direct fires from space aga

targets on earth. It is possible that internatio

treaties will ban such weapons, as is the c

today for weapons of mass destruction, 

that is not assured. What is clear is that sp

will become permanently manned. 

Space will also enter into competi

planning and strategies in ways that 

barely conceived today. Future adversa

112 See Lt. Gen. Patrick M. Hughes, Director, Defense

Intelligence Agency, “Global Threats and Challenges 

the United States and Its Interests Abroad,” Statement 

the Senate Select Committee on Intelligence, February 

1997. 

113 Institute for National and Strategic Studies, Strategic

Assessment 1999 (Washington, DC: National Defense

University, 1999)

114 See Thomas T. Bell, Weaponization of Space:

Understanding Strategic and Technological Inevitabili

Occasional Paper No. 6 (Air University, Maxwell Air

Force Base: Center for Strategy and Technology, Air W

College, January 1999); Dana J. Johnson, Scott Pace, 

C. Bryan Gabbard, Space Emerging Options for Natio

Power (Santa Monica, CA: RAND, 1998); and

Christopher Lay, “Can We Control Space?” presentati

Electronics Industry Association, October 1997. 
U.S. Commission on National Security/21st Century 

54 NEW WORLD COMING

will realize that assured access to information

is a key component of U.S. military strategy

and, specifically, to the sort of military operations envisioned by the Joint Chiefs of

Staff.115 Thus, negating U.S. conventional superiority through the denial or negation of

information sources based in space is an

obvious and lucrative strategy for some countries or groups to employ. 

All of this suggests that information superiority will be relative. While the United States will

retain relative superiority in C4ISR (command,

control, communications, computers, intelligence, surveillance, and reconnaissance) systems

development and integration, the nature of information technologies and their ubiquity in the

commercial market place make any presumptions about assured information superiority

unwise. Globally, military forces will rely on

highly networked, space-based and ground-based

intelligence and reconnaissance systems, but

backup systems will be available to protect

against successful anti-space operations. Due to

the wide availability of commercial sources of

space-supported information, by 2025 the United

States will no longer enjoy a monopoly in spacebased C4ISR. It will, however, maintain a

preponderant edge, using its technical systems to

produce timely and usable information.116

What do these developments portend

for the strategic environment of the

future? Most essentially, they mean that both

conventional and nuclear deterrence will

remain a priority in the coming century, but

will be harder to achieve than ever before. The

predictability of deterrence cannot be assumed

based on Cold War experience for several

reasons. 

First, the convenience of focusing on a

single antagonist has been eclipsed, along with

the comforting knowledge that deterrence was

essentially a bilateral interaction between 

superpowers with shared vulnerabilities 

known capabilities. Such conditions no lon

exist, nor will they in future. A wide diffus

of actors and destructive capabilities w

instead characterize the context of deterren

Exactly who is being deterred, exactly wh

value hierarchies and decision systems need 

be affected, what relative costs and benefits 

at issue, and what behaviors are supposed to 

shaped by deterrence, will all be very probl

atic questions.117 Rogue irrationality and 

potential for misperception or ignora

remain possibilities, as well. In short, Cold W

concepts will have to be revised, adapted, o

some cases abandoned in the face of new 

cumstances. 

Of crucial importance, too, the deterre

problem is also likely to be inverted and thro

back at the United States by many actors an

several forms. It is one thing for the United St

to deter others by threatening use of nuc

weapons or massive force, and to make s

threats not only credible to others but also 

ceptable to Americans. But it is an enti

different matter to avoid being deterred by thr

to use weapons of mass destruction against 

United States, against U.S. forces abroad

against U.S. allies. While the United States 

remain superior to all rivals in measura

military capabilities over the next 25 years, th

are ways that “bronze” technology in the ha

of a potential adversary can blunt “gold” techn

ogy in our own hands. If more countries acq

weapons of mass destruction, and the ability 

115 U.S. Department of Defense, Joint Chiefs of Staff, Join

Vision 2010 (Washington, DC: USGPO, 1996).

116 See Roger C. Molander, Peter A. Wilson, David A.

Mussington, and Richard F. Mesic, Strategic Informat

Warfare Rising (Washington, DC: RAND, 1998).

117 Keith Payne, Deterrence in the Second Nuclear Age

(Lexington: University of Kentucky Press, 1996).
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

deliver those weapons in a wide variety of

venues, the flexibility and credibility of U.S.

regional security policies could be sharply

limited despite overall U.S. military superiority. This is the problem of inverted deterrence.

We should also expect to be both

strategically and tactically surprised

despite our prowess in the information revolution. History is in many ways little more than a

cavalcade of such surprises. As suggested

above, no amount of technology will ensure

perfect intelligence about the capabilities or intentions of every possible opponent.

Generating knowledge and insight from raw

data requires the analytical capacity of the

human mind, and human intelligence will

remain a key component of any first-rate intelligence operation. We should remain humble

about the ability to predict events or the reactions of adversaries to our own initiatives. The

range of variables is endless, and our potential

enemies will be both intelligent and adaptive.

They will try to deny or distort any information

that we may process into useful intelligence. If

history is any measure, specific predictions will

never unfold exactly as foretold.

One underlying reason for this is cultural.

Strategic surprise is abetted by mirror imaging—

viewing future opponents as having similar

values or beliefs to one’s own when they in fact

do not. Some leaders and societies are motivated

by values and goals that are different if not antithetical to our own, and their resort to extreme

violence—often against civilian populations—

will doubtless surprise and shock us in the future

as it has in the past. We may not comprehend

either the stakes or the commitments that some

opponents may make in using such violence.

Since conflicts frequently occur from miscalculations borne of ignorance or misperception

about opposing views, knowledge of foreign

cultures is a necessary component of strategic

intelligence and a bulwark against catastrop

surprise in the future. Antagonists who share 

strategic culture and values, who have sim

political institutions, and who maintain the sa

sense of proportionality or rationality about t

interests and the means employed to sec

them, are not our likeliest adversaries in 

future. To assume otherwise, as one strate

has noted, reflects "an a priori detachment fr

the well-springs of conflict and violence in 

modern world."118

While new actors and new weap

will change the character of conf

in the next century, the essence of war 

remain the same. States, groups within sta

and extra-national organizations will still r

on force and the threat of force to pursu

variety of political, economic, and mili

aims. Asymmetries in both capabilities and 

jectives will be exploited in the on

prosecution, and termination of conflict. Si

human emotions will still infuse warf

conflict will not be limited to purely ratio

goals, nor can we count on rough proportio

ity between ends and means. Fear, uncertai

risk, and ambiguity will still character

conflict despite the advent of unpreceden

levels of information technology.119 Tha

because, not least, clever and determined 

versaries will find new methods of decept

and denial to thwart superior U.S. technical 

pabilities—such as burying communicati

cables so that U.S. intelligence assets can

“hear” from space. Ultimately, as in the p

the character and conduct of future conf

will be influenced by who is fighting wh

how, and over what. Surprise will remai

118 Lawrence Freedman, "The Revolution in Strategic Affa

Adelphi Papers 318, 1998, p. 77.

119 See Barry Watts, Clausewitzian Friction and Future Wa

McNair Paper 52 (Washington, DC: National Defense

University, October, 1996).
U.S. Commission on National Security/21st Century 

56 NEW WORLD COMING

risk, not because technology will fail us, but

because our judgments may not anticipate the

full range of strategic contingencies.120

Nevertheless, presuming continued investment at roughly today’s resource levels, no

state will acquire the strategic mobility and expeditionary capabilities that currently provide

the United States with global reach and sustained combat power. But U.S. military

superiority will continue to rest on the performance of educated and well-trained military

forces and appropriate military doctrines as

well as modern equipment. While technology

is a crucial enabler, it is only one component of

military capability.121 Military power is more

than the sum of the various armed services or

the size of the defense budget. Continued

national support for the military and the

preservation of the political will to pursue

national interests will remain necessary ingredients of success.

The United States will also retain its traditional advantage in high technology, but the

blurring of man, machines, and information

systems will accelerate.122 As has always been

the case, having new devices is one thing, and

integrating them into the human subculture of

the military is another. American commercial

successes should also keep the United States

the leader in command and intelligence system

development, systems integration, and information management. 

At the same time, however, America’s coalition partners will lag behind American collective

achievements in high technology and the integration of advanced computational capabilities

into advanced military systems. This will lead to

widening gaps in compatibility and interoperability that will affect the ability of allies to

operate with the United States in an integrated

fashion. In addition to technologically-driven

gaps, potential challenges to alliance relati

ships could also arise from burden sharing 

risk sharing disputes. As always, uneq

burdens and risks will make creating coaliti

of the willing more difficult. 

Nor will the causes of war change in th

essence. Men have always fought for reas

that some other men could not understa

That will still be the case. New forms of id

logical struggle cannot be ruled out, 

neither will religion disappear. Such mot

tions will generate intense passions and w

ensure that tomorrow’s conflicts are not fou

solely according to American definitions 

rules of conflict. War will not be like a vi

game, and although American forces may f

some contingencies with dispassion, 

cannot count on our adversaries taking 

same attitude.123

Clearly, there are new challenges in 

future, especially for a U.S. mili

strategy that has relied on forward-based 

forward-deployed forces as a key componen

that strategy. The permanent stationing of U

forces abroad will become more difficult 

sustain. The political cost of such bases wi

American alliances will likely rise, as will 

vulnerability of such forces to attack with b

120 See “Making Intelligence Smarter: The Future of U.S.

Intelligence,” Report of an Independent Task Force,

Council on Foreign Relations, February 1996.

121 For eloquent testimony to this point, see Stephen Ambr

Citizen Soldiers (New York: Simon & Schuster, 1997)

122 But this will not happen automatically, and there are bu

reaucratic impediments to its progress. See Andrew

Krepinevich, “Emerging Threats, Revolutionary

Capabilities, and Military Transformation,” Testimony

before the Senate Armed Services Committee on

Emerging Threats and Capabilities, March 5, 1999.

123.See Robert H. Scales, Future Conflict (Carlisle, PA: U.

Army War College, 1999).
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

listic missiles, cruise missiles, terrorism, and

weapons of mass destruction. The latter circumstance may erode support for such bases

from the home front. Taken together, the pressures against the permanent forward basing of

U.S. military forces have profound implications for U.S. strategy, power projection

capabilities, and alliance relationships.

The future strategic environment will therefore be one of considerable turbulence. Stability

may simply not be achievable at small cost—or

at any cost—and riding out the storm at anchor

is not an option. The international system will be

so fluid and complex that even to think intelligently about military issues will mean taking an

integrated view of political, social, technological, and economic developments. Only a broad

definition of national security is appropriate 

such a circumstance.

In short, we have entered an age in wh

many of the fundamental assumptions 

steered us through the chilly waters of the C

War require rethinking. In the decade since 

fall of the Berlin Wall a start has been made, 

a start is not good enough. The very facts 

military reality are changing, and that be

serious and concentrated reflection. The ref

ive habits of mind and action that were 

foundation for U.S. Cold War strategy 

force structures may not be appropriate for 

coming era. How the United States and o

states respond to these changing dynamics 

determine the relative peace and security of 

next century. 
U.S. Commission on National Security/21st Century 

58 NEW WORLD COMING

II: A World Astir

I

f nothing else, the intellectual investment

represented by the preceding section

proves that the world is a vast and complicated

place about which our knowledge is limited and

our powers of forecasting uncertain. But it offers

more than that. A composite picture of global

dynamics suggests a plausible range of influences that will affect regions and countries. It

suggests, too, that regions will not be as selfcontained in 2025 as they are today. 

Nevertheless, global dynamics are not

wholly determinative, and they are not uniform

across the globe. That is why a regional analysis,

undertaken below in five sections, is still nec

sary to capture the shape of the world ahead

Greater Europe

During the past century, Europe has 

a very significant impact on U

national security. The United States fought 

world wars and sustained a 40-year Cold W

with the Soviet Union to prevent Europe fr

being dominated by a power with inter

inimical to its own. In so doing, the Un

States expended enormous financial 

military resources and risked its own surv

as a state.
European Union manages to transform it

into a federal state with a unitary foreign 

security policy, or whether a failed effort to 

so leads to re-nationalized security policies

Second, Russia’s post-communist future co

mire Europe in pressing security concern

that future produces either chaos and disi

gration or a reborn authoritarianism prone 

imperial ambition. A third source of trou

could come from the states located betw

western Europe and Russia, where 

prospects of economic and political refo

vary markedly.

SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

Greater Europe—which includes the countries of western Europe, eastern and central

Europe, and Russia—will retain lasting importance for U.S. security interests in the next

quarter century for an array of reasons.124

Greater Europe will have a population of approximately 761 million by 2025.125 An

economically integrated European Union

would have an economy slightly larger than

that of the United States.126 This region will

remain an important center of international

trade and finance, a pivot of scientific and technological innovation, a region capable of

deploying sophisticated military capabilities,

and a significant actor in global politics. 

Europe’s importance to the United States

also rests on cultural factors. Most Americans

trace their historical and cultural roots to

Europe, and will continue to do so throughout

most of the early 21st century. More important,

America’s political institutions and philosophies are essentially European, and the region

will remain the largest and strongest community of states sharing the basic democratic values

that undergird U.S. political culture. It is also

the region of the world most tightly bound to

the United States by an unprecedented array of

economic, cultural, and political ties.127

For all these reasons, Greater Europe’s evolution in the 21st century and its relationship

with the United States will be as important to

U.S. national security interests as it has ever

been. But there is yet another reason why this

region is liable to be important: it could become

a major source of trouble—trouble that could

take three intersecting forms. 

First, the evolution of west European institutions over the next quarter century will likely

spark economic competition, diverging political interests, and serious tensions with the

United States. This will be so whether the

124 In this study we use “western Europe,” not “Western

Europe,” and the same goes for eastern and central

Europe. We have a specific reason for so doing.

Capitalization of these terms, which settled into a patt

during early Cold War times, indicated a political/ideo

ical disposition: West meant democratic and East mea

Communist. This made sense, for through capitalizatio

English usage gave us the ability to distinguish betwee

the merely geographical and the abstract. Today, obvio

ly, this distinction no longer applies—although we stil

the cultural phrase the West, as distinct from the geographical term the west, to indicate the domain of

free-market democratic countries whose intellectual

origins are to be found in the Renaissance and the

Enlightenment.

125 U.S. Bureau of the Census figures and projections, 199

126 1996 base GDP figures by country are drawn from 199

World Development Indicators (Washington, DC: The

World Bank, 1998), pp. 180-2. For growth rates used 

derive 2025 figures, see OECD, The World in 2020, p

It is worth noting that these OECD statistics were

compiled before the 1997-98 Asia crisis. But at the tim

this writing, there is no inclusive post-crisis data set fr

which to draw.

127 See Paul S. Schroeder, “The New World Order?”

Washington Quarterly, Spring 1994; and Daniel Deud

and G. John Ikenberry, “The Logic of the West,” Worl

Policy Journal, Winter 1994.

128 See generally Robert Blackwill, ed., The Future of

Transatlantic Relations: Report of an Independent Tas

Force (New York: Council on Foreign Relations, Febr

1999).
U.S. Commission on National Security/21st Century 

60 NEW WORLD COMING

I

n the coming decades, three critical

macro-social, economic, and political

forces will strongly affect the states of Greater

Europe. First will be changing demographic

patterns and the resulting need for new social

policies. 

With the exception of Turkey, no state in

Europe today even maintains a population replacement rate, and this trend is unlikely to

change through 2025. Aging populations strain

existing pension provisions as the number of

workers paying into the system declines

relative to the number of retirees.129 Fears of

politically unsettling migrations from the EU’s

periphery are likely to yield immigration

policies far more restrictive than those in operation today, closing off one available means of

countering prevailing demographic trends. It is

not even clear that unrestricted immigration

within the EU will last 25 years, due in part to

different historical and cultural dispositions

toward immigration.

East of the European Union, a similar demographic story yields a different set of

possible outcomes. Russia’s population will

both age—25 percent of the population will be

over 60 by 2025—and shrink from appro

mately 148 million in 1995 to approxima

139 million in 2025 largely due to low b

rates and acute health and environme

crises.130 Russia’s aging population w

increase pressures for social spending, 

problems of unemployment and a non-fu

tional tax collection system will make it har

raise adequate funds. Worse, Russia’s d

economic conditions will probably stymie 

adoption of anything more than stop

measures across the range of social pol

Moscow’s inability to address such proble

will add to those social tensions, reduc

further the legitimacy of the central gove

ment. 

In the states of eastern and central Euro

the critical challenge will be two-fold: whe

governments can rebuild the social safety n

that were destroyed after the fall of the Be

129 Sheetal K. Chand and Albert Jaeger, IMF Occasional P

147: Aging Populations and Public Pension Schemes

(Washington, DC: International Monetary Fund, 1996

p. 12.

130 All population figures, here and below, are drawn from 

U.S. Census Bureau’s International Database.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

Wall; and whether societies can maintain their

nascent democratic political cultures in the face

of episodic economic stress.

Second, economic growth rates will be a

major factor in the region’s prospects. The

achievement of a common EU foreign and

security policy, as well as the success of the

euro, will require a growth rate at the upper end

of the current OECD forecast range—an

average of 2.5 percent or better over 25

years.131 Lower growth rates could limit the

European Union to the creation of common

economic, fiscal, and monetary policies, and it

could possibly doom the euro. These lower

growth rates could also place at risk the ability

of current members or EU aspirants to attain

the economic targets required by the Union—a

condition states may be unwilling to resolve

through difficult structural adjustments. 

For the west Europeans, it will be especially critical whether they find a way to reconcile

their deeply embedded views on welfare with

the new macroeconomic orthodoxy sweeping

the world. The future of the euro may well be at

stake. Some believe that the initial fall in the

euro’s value over the first six months of 1999

was mainly the result of an expectation that

U.S. interest rates would rise. Others, however,

have seen a structural cause in the relationship

between the size of Europe’s welfare function

and the foreign exchange value of its currency.

Expensive welfare states tend to have low

growth economies, which leads central bankers

to lower interest rates in order to stimulate the

economy. That creates trade surpluses, but it

also devalues the currency, making efforts to restructure the EU’s approach to welfare crucial

to the future economic success of the European

Union. 

Economic growth rates will also have a

major impact elsewhere on the continent. The

relationship between improving econo

prospects and the institutionalization of dem

cratic governance is to some extent circu

Economic prosperity cannot guarantee polit

stability—but it helps. So whether in Russi

Romania or Latvia or Poland, good times 

make it easier for reformers to gain support 

their future visions, and lean times will mak

harder. The level of integration between eas

and central Europe, including Russia, with 

rest of the world will also play an impor

role in the area’s prospects. If global econo

dynamics are essentially healthy, there will b

greater impetus to adopt international b

practices, and that will spur positive poli

for the region. If international econo

dynamism stumbles, such incentives will 

weaker and their positive impact smaller.

Third, political leadership will play a v

role in determining the region’s future. For 

European Union, bold leaders reared mostly 

the post-Cold War period could build on th

experience with a common European curre

and the unimpeded movement of goods 

persons across state boundaries to creat

common foreign and security policy. Abs

such leadership, states in the European Un

may be unwilling to yield sovereignty t

supra-national body.

While Russia’s political system w

probably not achieve a fully institutionali

democracy, strong leadership committed to 

mocratic ideals will be crucial to prev

disastrous backsliding. Such leadership wo

enable the central government to retain so

measure of control over newly empowe

regions. It could also help to ensure contin

aid and investment from the OECD count

and international financial institutions to w

will remain a precarious economic and polit

131 OECD, The World in 2020, p. 92.
U.S. Commission on National Security/21st Century 

62 NEW WORLD COMING

system. Without a democratically oriented

leadership, Russia may disintegrate, or a strong

authoritarian leadership may emerge in its

stead.

The danger posed by poor or divided leadership elsewhere in Europe will be a freezing of

national futures in limbo between the democratic West and the problematics of Russia. The

Czech Republic, Poland, and several other

states “in the middle,” so to speak, have deep

Western cultural roots, whether through the

impact of religion, history, geographical

propinquity, or all three. Others, to one extent

or another, do not. At the outer edge of the Cold

War, all these societies are being pulled toward

the West, but not equally or with similar results.

The quality of political leadership over the next

25 years will be critical to determining which

of these societies find the will and way to

change themselves into the states they now

wish to be, and which will not. The result will

mark a new cultural and political boundary for

the future. 

What follows is an analysis of a range of

plausible alternative futures for Greater

Europe. It begins by depicting a region

enjoying relative stability and prosperity and

assays the conditions conducive to such good

fortune. It next turns to less positive alternatives from the U.S. point of view, similarly

seeking to isolate likely causal factors. 

I

n one view of the region’s future, the

European Union would continue to be at

the forefront of many of the positive trends

highlighted in the discussion of global

dynamics. It will continue to be the prototypical case of a group of states, committed to

market-based liberal democracy, that relinquish

increasing degrees of sovereignty to achieve

greater economic success. That effort, in turn,

would result in the EU assuming a more significant leadership role within the internatio

arena. 

If the political integration and econo

expansion of the EU go as planned, it co

help to institutionalize democratic governa

and market economies in at least some nei

boring countries to the south and east. 

important, it would finally put to rest any 

gering fears that the major European count

would ever again go to war with each ot

Many believe that it would also create a l

minded and similarly powerful partner for 

United States with which to share the burden 

global leadership.

By 2025, a mature European Union co

be a successful economic, monetary, and tr

union, with a common justice and legal str

ture. It would pursue a common foreign 

security policy under the leadership of 

Secretary-General of the European Council 

High Representative for the Common Fore

and Security Policy. It would assume prim

responsibility for Europe’s own security, ba

on a unified headquarters and staff for an 

European defense force. It would most lik

include some twenty states, with new memb

coming from central and eastern Europe. Th

is no more than a fifty-fifty chance, howe

that Turkey will become a member of the 

during this period.

Uncertain is whether the EU will invite 

Baltic States or Ukraine to join, given th

proximity and historical ties to Rus

Economically, the Baltic States will proba

meet the criteria, but Ukraine probably will 

Russian opposition will be a signific

obstacle, especially as the EU accrues seri

military-strategic functions. If the EU take

the Baltic States and Ukraine, it risks a sign

cant further deterioration of its relations
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

with Russia. If it does not take them in, it perpetuates a series of unsettled relationships.

Whatever its precise size, a mature

European Union would be a global

political, economic, and technological force.

Annual growth rates averaging over 2.5 percent,

and concomitant productivity gains, would drive

a successful euro and rival U.S. GDP growth.132

If this occurs, the euro would become a main

reserve currency and unit of international

exchange. Unless the euro appreciated too

rapidly against the dollar, this would further EU

competitiveness in international trade and

finance. Such economic success would provide a

sound basis for addressing social welfare

problems brought on by aging populations. 

The EU would be responsible for the

defense of its members and capable of responding effectively to regional security

threats. It would have developed the ability to

conduct multi-divisional peace enforcement,

peacekeeping, and humanitarian assistance operations within Europe. Most EU states would

have small, professional militaries. Their force

structures would be bifurcated between highreadiness forces available for such missions as

peacekeeping and larger national defense

forces requiring significant reconstitution to be

effective. Because of the newness of the

European Union’s common security policies

and stronger military capabilities, its policies

would probably have a regional focus aimed to

prevent the spilling over of instabilities and

chaos on its periphery.

In such a world, NATO’s future would be

uncertain. It is hard to see how a truly integrated

and independent European defense force could

coexist with NATO, as it is presently constituted.

NATO could remain formally the ultimate guarantor of European security, based on Article 5 of

the North Atlantic Treaty. But in this case,

NATO’s operational military command str

tures would gradually disappear. The U

military presence would probably dimin

sharply, though the United States might 

remain engaged in peacetime through perio

deployments. The political entry to Europe 

U.S. leadership of NATO provides today wo

diminish. 

Even if the EU were to build a unified 

independent military structure, a signific

military technology gap would exist betw

the United States and its European allies. 

United States would continue to spend more 

defense than its EU associates combined. 

establishment of a single, integrated Europ

defense industry could increase European s

sufficiency in defense, but only if the Europe

were prepared to expand their defense spend

and procure their arms and equipment alm

exclusively from this industry. 

Over the period through 2025, Russi

unlikely to achieve a fully institutio

ized democracy. The time is not at hand 

corruption-free political and economic inst

tions, investment-fueled economic developm

and a foreign policy oriented toward full integ

tion with the democratic world. But Ru

could evolve in such a way as to be neithe

great democratic success nor a great threa

Europe. That is a condition well described 

either status quo-plus or status quo-minus. 

While still facing enormous proble

Russia in a condition of status quo-plus wo

have acquired a post-sclerotic leaders

132 The OECD under a high-growth scenario predicts long

term U.S. GDP growth rates to be 2.6 percent per ann

A weighted average of high-growth estimates for curr

EU members and for the newly admitted states envisio

by this paper yields a GDP growth rate for the Europe

Union of 2.6 percent, as well. See OECD, The World 

2020, p. 92.
U.S. Commission on National Security/21st Century 

64 NEW WORLD COMING

capable of some political and psychological

dynamism. It will also have created a governing

political party able to accomplish institutional

reform. An active and reasonably popular president, supported by his party in the Duma,

would finally be in a position to firmly establish the rule of law, privatize land, and enact tax

legislation that could give the government a

stable expectation of essential resources. As a

result, Russia’s increasingly autonomous

regions would likely be drawn back toward the

center. This is not beyond possibility over a 25-

year period, and it could occur far more quickly

than that. Even under such conditions, however,

Russia could not grow economically at more

than 2 percent a year. But at least the malaise so

pervasive today would lift, and a new postCommunist generation could begin to inherit

social and economic power in an environment

dotted with islands of hope and progress.

Why would growth be so slow even if a

more propitious political environment were

created? Because Russia faces an enormous

problem in renewing and diversifying its industrial and commodity base after 70 years of

distorted markets and under-investment. It is

also likely to continue to suffer chronic unemployment, pervasive corruption, and massive

tax evasion even under the best of circumstances. In such an environment, status

quo-minus is just as likely as status quo-plus. In

this case, Russia’s share of global GDP would

contract and growth would stall, with occasional periods of severe economic contraction,

between now and 2025. This would hamper

Russia’s ability to attract private foreign investment, causing continued reliance on assistance

from international lenders such as the IMF. 

In this view of Russia’s future, mostly untreated health and environmental problems

would grow very serious. The spread of MultiDrug Resistant Tuberculosis (MDRTB) and

HIV/AIDS would debilitate the work fo

lower national morale, and cost large sums 

scarce capital to control, if not resolve. He

risks owing to environmental conditions 

grow. Thousands of former biological, chemi

and nuclear weapons sites will exist, but l

money will be available for remediat

Chemicals and toxins in the soil and water 

over from industrial processes now abando

will have direct and possibly serious effects 

the health of Russians as well as many north 

east Europeans.

The result of the combination of econom

health, and environmental trends could be 

increase in Russia’s existing political and so

strains. In some regions, such strains co

spark backlashes against the country’s for

but largely dysfunctional experiment in dem

racy. 

Given Russia’s importance to Europe, 

major European countries as well as the Un

States are likely to persevere in their effort

help Russia develop institutionalized demo

cy, a more robust civil society, and a m

effective economy. But even extensive exter

aid is likely to achieve little more than a ro

preservation of the status quo—whether plu

minus—and it could end up holding off 

enough pain in Russia to delay real reform. 

Under most any circumstance, the Russ

government’s control of its national bord

will be problematic. Central authority co

well be limited to matters of national defe

policy, monetary policy, and the coordina

of inter-regional transportation and commu

cations. Political violence within Russia 

along its periphery will likely attract and sub

quently coexist with widespread, hig

entrepreneurial criminal syndicates that m

develop strong economic and political tie

regional and local elites. These dynamics
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

combination with the lack of financial resources available to maintain the quality and

professionalism of its military and nuclear

forces, will cause continuing concern within

Europe and the United States. “Loose nukes”

and “loose bugs” are obvious problems, but so

is the lack of effective oversight for the many

still functioning Chernobyl-design nuclear

energy plants.

Some of Russia’s regions could become

political power centers in their own right, performing most vital public functions. In the

event that Moscow cannot exert effective

control over its own federation, regional elites

will play a major role in the selection of

military commanders and their staffs. Regional

leaders would most likely develop their own

foreign policies as well, seeking closer ties to

wealthier neighboring powers and other potential allies. The Far East regions may gravitate

toward Korea and Japan, and those in Central

Asia (such as Tatarstan) may move closer to

their Muslim neighbors, particularly Turkey,

Iran, Pakistan, and Uzbekistan. The regions

closest to Europe would most likely seek

closer ties to the European Union and to

Germany in particular, but also with the Baltic

states, Ukraine, and other Slavic states

(Bulgaria, and even Belarus) that may be doing

better than Russia. The question of Russia’s

stability and national cohesion will have a

major impact on the security calculus of all the

states on Russia’s periphery. Russia will have

become the “sick man” of early 21st century

Eurasia—sick enough to worry everyone, but

neither so deathly ill nor so imperially healthy

as to pose the kind of threat to the rest of

Europe that could decisively throw it off track.

I

n this view of Greater Europe’s future,

most of the states between the European

Union and Russia would improve economically and politically—in absolute terms—from

where they are today. The OECD expects 

average economic growth rate over this per

of 4.9 percent.133 Such growth, if it occ

will likely be facilitated by continued inv

ment by EU countries, the United States, 

other global economic players who w

continue to view the future of a market 

about 194 million people as an important 

vestment priority. Free from Commun

only about five years, their combined GDP 

1996 amounted to about $423 billion—aro

2 percent of the global share.134 In the com

25 years, this region will very likely incre

its global standing in GDP and ot

economic terms.

Politically, most of central and east

Europe will benefit from the positive trend

deepening democracy and expanded inter

tional commerce, even if many states do 

achieve full global competitiveness. Many

not most, central and eastern European sta

will have mature democratic systems by 20

There will be regular fair elections, the in

tutionalization of the rule of law, democr

and civilian control over military institutio

respect for civil liberties, and a willingnes

pursue peaceful solutions to territo

disputes and irredentist claims. Even if so

are not full members, most of the these sta

will be linked politically with both 

European Union and NATO. 

At the same time, the situation in 

Balkans will remain tenuous even in 

rosiest of futures. Only Slovenia and Gre

have a good chance to escape economic st

nation and political instability, because t

are relatively stable democracies and h

enough highly educated people to succeed 

133 OECD, The World in 2020, p. 92.

134 World Development Indicators (Washington, DC: The

World Bank, 1998), pp. 180-2.
U.S. Commission on National Security/21st Century 

66 NEW WORLD COMING

an age of economic integration.135 Bulgaria,

Romania, Serbia, and Croatia face greater

challenges but may still succeed. But elsewhere, Balkan countries will continue to

experience economic dislocations and more

than occasional bad government, complete with

corruption, manipulation of state finances, suppression of the media, and a lack of elite

concern for pressing national problems. 

No enduring settlements to the conflicts in

Bosnia or Kosovo are likely to emerge from the

U.S. and NATO-brokered agreements that

ended the wars there. As a result, ethnic

tensions and the security fears that go with

them will remain, regularly threatening to erupt

into outright conflict. Moreover, with Bosnia

and Kosovo stuck in a state of suspended political animation, problems in Macedonia,

Montenegro, and Albania will become more

likely. As a result, it is highly improbable that

any of these countries will be integrated into

western Europe’s political and economic institutions within the next quarter century. 

Amore dour future for Greater Europe is

also possible. It would turn on three

basic elements of potential bad fortune. The

first is that the European Union collapses,

leading to the rise of re-nationalized economic

and possibly security policies. The second is

that the Russian state disintegrates altogether or

acquires a revanchist authoritarian leadership.

The third is that the lands between the EU and

Russia fall into a pattern of economic failure,

governmental ennui, internal violence, and

cross-border wars sufficient to generate a

steady stream of strategic and humanitarian

crises for most of the next 25 years. Any one of

these developments could encourage the other

two. 

A collapse of the European Union could

result from a failure to sustain annual economic

growth at rates of at least 2 percent. Such s

growth could arise from a loss of confiden

growing disillusionment among polit

leaders and their citizens, and likely popular 

sistance to further funding any joint policie

collapse could occur, as well, as a result 

shifts in leadership with a concurrent re

tance to yield national sovereignty over crit

political and economic policies. The unwilli

ness of a population to endure the pain 

meeting economic targets, or of undertak

structural changes to address failures in 

social safety net, might also serve as occas

for leadership changes. 

Another possibility is the specter that a 

alescing governmental authority at the EU le

might be essentially undemocratic. Curren

the European parliament does not have bind

authority over national member governme

but the EU bureaucracy in Brussels does 

selected policy areas. Already the creation 

European central bank and currency has gre

diminished the power of national legislature

affect crucial pocketbook issues such as inte

rates and money supply, which in turn dim

ishes the significance of citizens’ votes 

those legislatures. Unless EU political inst

tions manage to keep pace with economic 

security ones, a significant popular and e

backlash against integration could ensue, es

cially in times of economic adversity. 

More than that could go wrong, as well

the form of external pressures on young EU 

stitutions. Conflict in North Africa could re

in the movement of large numbers of migra

to southern Europe and points north, upset

political equilibria and fracturing common 

migration and social policies. A signific

security threat from Europe’s periphery, fr

135 We use the term Balkans here in a strictly geographical

sense.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

Russia or the Balkans, might empower a strong

preference for NATO—which is to say,

American—leadership, and sharply diminish

interest in pan-European solutions and institutions. 

Regardless of the precipitating events, the

implications of lost European confidence in the

inevitability of a federated Europe would be

significant. Outside Europe, the euro would

lose value as demand waned for holding

European assets. Lower growth rates and a

weaker euro would limit domestic consumption, while higher interest rates would dampen

investment. In the face of this loss of confidence and resulting economic effects, and with

no alternative plan in place, the EU could begin

to unravel. Germany would probably reassert

its national interests politically, economically,

and possibly even militarily both within and

outside Europe. France might move sharply to

the right as it finds that it can no longer use international processes and institutions to limit

Germany’s return to independent major power

status. The far right would probably prosper

more generally, too, in countries such as Spain,

Portugal, Italy, and Austria. Additionally, the

United Kingdom might attempt to separate

itself from Europe and focus instead on its

special relationship with North America and

the wider English-speaking Commonwealth. 

If any of these events occurred singly or in

combination, competition among European

states would most likely become the norm, with

significant undertones of national chauvinism

and regional and global economic protectionism. Elements of the re-nationalization of

European defense would soon emerge, if not on

the scale of the pre-World War II period, then

much more vigorously than in the post-World

War II period.

While such a situation might increase 

importance of the U.S. dollar, of NATO, and 

the U.S. role in Europe, many negative con

quences would flow as well. The collapse of 

euro could send major shocks through the 

ternational financial system. A failure of 

European Union would also send a signal, 

at worst deal a mortal blow, to other m

nascent regional organizations trying to achi

free trade and other common arrangeme

The United States might be forced to undert

much of NATO’s financial burden. Tensi

between a Europe perceived to be shirking 

financial responsibilities and a United St

being asked to contribute more to Europ

defense would strain the trans-Atlantic 

despite a U.S. willingness to pay and do m

Alliance coherence would be harder 

maintain during the transition period as 

national biases and animosities resurfaced. 

The second concern at the more d

end of our continuum is two-fo

either the collapse of the Russian state or 

rise of a new authoritarianism. Both could 

disastrous, albeit in different ways. 

Russia’s disintegration would have seri

consequences. Unemployment in Russia wo

reach severe levels. Corruption and inadequ

tax collection efforts would leave insuffic

funds for even basic social services. Econo

growth would plummet to negative rates o

sustained periods. The magnitude of its so

and economic problems would probably be 

great, and the decentralized power of 

regions so comparatively strong, that Russ

central government might essentially disapp

Regional and ethnic tensions, compounded 

sharp economic disparities, would fuel er

tions of conflict and the mass migration 

civilians fleeing instability and violen

Military forces, including tactical nuc

weapons, might come under the control of lo
U.S. Commission on National Security/21st Century 

68 NEW WORLD COMING

military commanders and political warlords.

The last Russian civil war and collapse, from

1917 to 1921, was horrible. A future one might

be even worse, and not just for Russians.

A significant Eurasian power vacuum

would flow from a Russian collapse, encouraging states with ties to various Russian regions,

such as Iran, Turkey, and Japan, to seek means

of furthering their own interests in the face of

Russian weakness. Faced with Russian disintegration and the unlikely possibility of restoring

Russian central authority, the European Union

and NATO might draw the Baltic States and

Ukraine into their organizations, in effect redividing Europe in order to prevent the spillover

of Russian instability into other areas of Europe.

Diplomatically and economically, the United

States and other countries would have to negotiate with multiple entities and factions with

claims to statehood, and deal simultaneously

with massive economic dislocations. Finally,

the dangers associated with wildly diffused

control over nuclear weapons, fissile materials,

and biological agents would present a security

crisis of the first order.

The resurrection of an imperial Russia, on

the other hand, however much it strains the

imagination to credit the possibility, would

pose other dangers. It would feature centralized

controls and a new leadership that would tap

into rekindled nationalist sentiments and nostalgia for Russia’s great power prerogatives.

Political structures and the creation of

economic dynamics designed to provide for

basic human and social needs would be governmental priorities, but at the expense of

democratic values. 

Authoritarian control in Russia could result

in greater internal stability, if it were to succeed

in maintaining near full-employment and in

providing essential welfare needs. It might be

able to crack down successfully on corrup

and organized crime. But this is not clear. S

a regime might be such an international par

that it could not successfully connect to the 

ternational economy, making its econo

prospects dire. If the government were not a

to solve the unemployment problem or ens

domestic security, it is hard to see how any s

“solution” could produce stability. Such 

“solution” would also be likely to generate s

aratist movements in non-Slavic areas of 

Russian Federation, particularly in 

Caucasus.

This would be particularly true given th

post-“democratic” Russia would probably 

resentful of those who tried to help the Yel

regime. In such a scenario, the already w

spread belief that Western aid was part of a p

to keep Russia weak and to invade its g

graphical spheres of traditional influe

would likely become accepted truth. Not o

would such a Russia be a nuclear power

might also elect to emphasize military spend

as a means to national industrial regenerat

After all, what remains of the old So

military-industrial complex is today virtu

the only Russian economic sector still bre

ing, if barely so. It would be a natural focu

investment and political patronage for a n

and nationalistic, authoritarian Russian regi

While such a regime could not cred

threaten Europe as a whole with conventio

military force, it could nevertheless p

obvious new threats to Russia’s closest nei

bors. Russia could turn Peronist, or it co

turn fascist, and the difference in the impl

tions for the world at large is not trivial. A w

corporatist regime would be unlikely to do v

much harm outside Russia’s borders, but a fo

of Russian national socialism, emboldened b

revived form of pan-Slavism, could 

enormous harm over all of Eurasia and beyo
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

In either event, Russia would cast a significant political shadow over the region in a way

that it does not do now, and in a way that neither

muddling along or disintegration would

produce. An authoritarian Russia could pose an

effective challenge to the West and act to reinforce its image as a power whose geostrategic

interests and calculations must be taken into

consideration. If this future develops, the United

States will have lost its investment in fostering

liberal democracy and in creating the economic

preconditions of a free-market system in Russia.

The apparently conclusive failure of democracy

in Russia might even trigger a reconsideration

of the presumed universality of core American

principles and beliefs—with unknown consequences for our own future.

Finally, the third misfortune that might

plague Europe in the 21st century

concerns those very diverse lands in between

the European Union and Russia. The Balkans

have furnished a nearly non-stop political and

humanitarian crisis since the early 1990s, and

things might get even worse despite the EU’s redoubled determination to funnel major amounts

of aid to the region. Albania, Macedonia,

Montenegro, Bosnia, and Serbia are ripe for

further violence and chaos. Belarus, Moldova,

and especially Ukraine are new states with

unproven track records and many problems.

Romania has made only sporadic progress

despite the end of the Ceaucesçu regime, and

both Slovakia and Bulgaria have struggled hard

to get even a little ahead of where they were in

1989. Ethnic and border questions aplenty

remain unresolved, and the quality of future

leadership is unknown. 

If the global economy falters, all of these

countries would be hit hard. If NATO acquires a

reluctance to intervene in such domains after the

experiences of Bosnia and Kosovo, the potential

for on-going violence and cross border wars can

only rise. Obviously, too, the specter of re-

tionalized security policies in western Eur

seeking agents and allies to the east—repea

the patterns of the interwar years—will 

make things any easier. Nor will a Russia in 

throes of collapse, exporting refugees, cri

nals, drugs, and weapons westward.

Amid the various possibilities sketc

out above, the most dramatic chan

are probably the least likely. The EU will nei

collapse nor achieve a fully unified foreign 

security policy. Habit and hope will prevent 

former, while British reluctance, difference

interest, and an unwillingness to buy the mili

assets necessary to undergird such a policy 

brake the latter. Hence, a rebalanced NATO 

likely to remain the premier institution 

Atlantic relations and the main instrument 

U.S. power in Europe. The political 

economic profile of the EU is likely to r

however, and insofar as there are difference

U.S. and European perspectives, it will make 

political management of trans-Atlantic relati

a more challenging task.136 Similarly, in all l

lihood, Russia will muddle through. In cen

and eastern Europe, what is today a very mi

picture will likely change in its particulars, 

remain mixed in its overall circumstances.

American policies will clearly be imp

tant to Greater Europe over the n

quarter century. Keeping the trans-Atlantic 

alive even as Europe bears more responsib

for its own security will require tact and forb

ance on all sides. It will be worth a major eff

for Greater Europe will remain very importan

the United States. U.S. political leaders

through NATO has been a vehicle to organize 

continent’s overall security and to mollify j

136 See Peter W. Rodman, Drifting Apart? Trends in U.S.-

European Relations (Washington, DC: The Nixon Cen

1999).
U.S. Commission on National Security/21st Century 

70 NEW WORLD COMING

ousies and historical fears among the European

members. American military forces in Europe

have been instrumental to these purposes.

Determining the extent and nature of the U.S.

military presence in Europe will therefore be one

of the key issues for the United States and its

allies over the next 25 years. The general tenor of

the U.S.-EU relationship will determine whether

this and other critical alliance issues are managed

in a relatively cooperative or a more adversarial

manner. 

U.S.-European cooperation will also be

crucial in the case of Russia, which will depend

upon the continued willingness of international

institutions to provide financial and other kinds

of assistance. Without it, the potential for

economic collapse will loom larger and make

the emergence of an undemocratic future more

likely. On the other hand, overly vigorous U.S.

involvement in the management of Russia’s

problems may risk provoking a backlash. A

careful balance will be critical.

American policy will also be critical to the

future of the countries of eastern and central

Europe. If the United States remains economically engaged, it could help offset the

in-between status that these states are liable to

have with the EU for many years ahead. And if

the United States remains culturally and politically engaged, it will continue to buttress the

evolving democratic political cultures in many

of these countries. The American example, as

well as that of the EU states, is crucial to their

evolution as democracies. It is all the more important, then, that U.S. policy deal with states in

their own right, rather than cast them as strategic

adjuncts of Russia to the one side and its NATO

partners to the other.

The range of futures for Greater Europe is

wide indeed, but even the most positive

view that one could reasonably take of the future

is far from ideal. Russia will not be robustly 

mocratic and prosperous, a unified Europ

Union will present challenges as well as opp

tunities, and eastern and central Europe 

compose a patchwork of successes and failu

The alternatives, on the other hand, prov

warning as to how bad things could get—

this is in the part of the world that most clo

shares U.S. values and civilization, and that i

advanced economically and politically as 

other continent. It is a sobering visage.

East Asia

East Asia—here defined as includ

Northeast Asia, Southeast A

Australasia, and all their oceanic appendage

contains not only upwards of a third of 

world’s population, but also what is widely ta

to be the most likely future politico-military n

peer competitor for the United States (Chi

two of its most critical allies (Japan and So

Korea), and one of its most intractable proble

(North Korea). The region’s importance to 

United States will grow between now and 20

whether due to its successes and strengths, o

the problems it could generate from weakn

and strife. Asia, and particularly Northeast A

is the region of the world most likely to witne

major war. It is the only region in which sign

cant territorial disputes among major pow

exist, in which the use of military force wo

alter the regional balance, and in which an al

ation of the regional balance would invaria

affect the world as a whole.

Recent trends suggest that East A

embodies vast potential for economic grow

peaceful development, and scientific as wel

cultural achievement in the decades ahead. In 

last quarter of the 20th century we have w

nessed a stunning, if lately stunted, econo

performance there. With it has come signific

social change, much of it tumultuous but mos
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

it positive. There have been notable improvements in education and basic health care, as well

as more equal opportunity for citizens of most

nations irrespective of gender or ethnic origin.

We have also seen the transformation of some of

the region’s erstwhile dictatorships into fledgling democracies, and, not least, East Asia has

managed to avoid major interstate violence.137

In short, we have witnessed strikingly successful modernization over most of a vast region,

and we have seen it take place mainly on its own

cultural terms—while influenced by those of the

West. This is a major datum, for aside from a 

isolated examples (Turkey, Japan, Finla

Israel), no cultural area as vast as East Asia 

heretofore replicated the sharp growth of liv

standards occasioned by the Indust

Revolution. The last four decades of East A

history prove that economic modernity come

more than one cultural form.

137 The Vietnamese invasion and occupation of Cambodia

(1979-89), and the Sino-Vietnamese border war of 197

are the partial and somewhat peculiar exceptions.
U.S. Commission on National Security/21st Century 

72 NEW WORLD COMING

These accomplishments represent only a

foretaste of the harvest of prosperity and intellectual and cultural achievements that could arise in

East Asia by 2025. By then the region may well

be the largest and most powerful economic

grouping in the world.138 East Asian economies

may grow at an annual average of about 6

percent over the next two decades, more rapidly

than any other area.139 If so, the region’s share

of global GDP could increase to slightly less

than one-third, with Europe, the next largest

regional economy, accounting for about onefifth. Significant Asian trade and investment

among the countries in the region as well as

with the United States, Europe, the Near East,

and Latin America would be assured. East Asia

is also likely to be the largest source of capital

for international markets. 

At the same time, energy consumption in

developing Asia will surpass that of North

America by 2020. Almost half the world’s 

crement in energy consumption will come fr

developing Asia. 

No doubt, the proven facility of East As

peoples to adapt and develop science-dri

technologies will lie at the heart of the regio

economic dynamism—if it comes to pass. If 

information revolution continues its long ma

through the economic institutions of the wo

138 Population expansion will in part drive the absolute siz

East Asian economies. The populations of the five larg

states in the region in 2025 will have changed from 19

roughly as follows: China from 1.2 to 1.4 billion;

Indonesia from 213 to 288 million; Japan from 126 do

to about 120 million; the Philippines from roughly 80 

121 million; and Vietnam from 76 to about 104 millio

people. East Asia’s population as a whole in 2025 wil

4.84 times the size of that of North America, and 6.56

times the size of the European Union’s.

139 OECD, The World in 2020, p. 92.

Source: International Energy Outlook 1996, Washington, DOE, EIA-0484(96), May 1996, p. 92, and

International Energy Outlook 1997, April 1997, DOE/EIA-484(97), Reference Case, p. 119.

Increased Demand for Oil in Asia Will Outpace World
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

and if an essentially liberal global economic

order is maintained, then it is clear that extremely lucrative cutting-edge technology of

virtually every kind will be available in East

Asia. Japan is likely to be a leading global innovator and manufacturer of technologies such

as micro-electromechanical systems (MEMS),

artificial intelligence (AI), robotics, and computers. Japan’s commercial space industry will

provide launch capability to many states and

private licensees worldwide. Korea and Taiwan

will continue to produce world-class communications and information technology, in some

cases challenging U.S. and Japanese technological superiority and marketing success. 

Australia, New Zealand, Singapore, the

Philippines, Thailand, Vietnam, Indonesia, and

Malaysia may also play major secondary roles

in the region’s technology-driven growth by

providing a mix of raw materials, human

capital, financial services, affordable labor, and

major expanding local markets. Rural areas as

well as the cities and major towns of the region

will be even more deeply linked electronically

than they are today, providing an important

economic multiplier effect. As these economies

grow, they will be able to afford infrastructures

that provide wide access to regional and global

communication grids and media resources. As a

result, expectations regarding quality of life are

liable to rise steadily. First in cities and later in

rural areas, people will aspire to better public

services, education, environmental quality,

crime control, medical care, and job-training.

In addition, greater access to media and information will whet appetites for political news

and participation. In short, new and expanding

middle classes will want what such classes

always want: economic stability and a piece of

the political action.

Greater information linkages within the

region will also encourage labor migrations

from less developed and urbanized countrie

the region to more rapidly developing ones

Such labor migrations could also boost the 

ucational levels of the migrants, allowing th

in turn to raise the labor and educational s

dards of their home countries.

Barring major political upheaval 

economic collapse, China will compete w

U.S. firms in space launches, and have sev

world-class high-technology firms engaging 

a wide range of corporate partnerships wo

wide. China will also most likely 

well-linked into the global communicati

grid, and will be in a position to use surv

lance, communications, and position

technologies for commercial and military 

plications. Also, under almost any imagina

political regime, China is likely to pur

biotechnology for commercial, medical, 

military purposes.

Along with economic and technolog

dynamism, East Asia over the next 25 ye

could become a zone of relatively peaceful 

lations, characterized by predominat

democratic governments well connected t

range of global economic and political inst

tions. The Association of Southeast As

140 By 2025 more than half of the region’s population will 

in cities, up from 35 percent in 1999. The graying of E

Asian populations is a major phenomenon to be coped

with in the next 25 years. Between 1995 and 2025, the

numbers of 15-64 year olds per person 65 years and o

will have fallen as follows: China, from 11 to 6; Japan

from 5 to 2; Indonesia, from 14 to 8; South Korea, fro

12 to 4; North Korea, from 14 to 6; Australia/New

Zealand, from 6 to 4; Malaysia, from 14 to 8; and the

Philippines, from 17 to 10. For more detail and some

likely social implications, see Nick Eberstadt, “Asia

Tomorrow, Gray and Male,” The National Interest, No

(Fall 1998), pp. 56-65. On Japan specifically, see Milt

Ezrati, Kawari: How Japan’s Economic and Cultural

Transformation Will Alter the Balance of Power Amon

Nations (Reading, MA: Perseus Books, 1999).
U.S. Commission on National Security/21st Century 

74 NEW WORLD COMING

Nations (ASEAN), the ASEAN Regional

Forum (ARF), and the Asia-Pacific Economic

Cooperation (APEC) forum will have matured

and expanded their functions. Multilateral institutions could arise to address new transnational

issues. It is possible, too, that East Asia will at

least begin to develop security and arms control

arrangements comparable to those in Europe.

Problems and tensions will persist. The

mutual suspicions bequeathed by some hard

history will not disappear. Not every state will

be a democracy, and very destructive weapons

will be available to ambitious leaders without

their countries having to first establish a large

or sophisticated industrial and scientific infrastructure. Economic competition could get

nasty between similarly endowed nations.

Vested political leaderships with a lot to lose

from rapid change could fail occasionally to

rise to enlightened levels, and the social

stresses of modernization could still overwhelm some of them even if they are

enlightened. 

But there is a good prospect that, with so

much more to lose, governments in the region

will find ways to bound their difficulties short

of war and beggar-thy-neighbor economic

policies—as has been the case in western

Europe for the past half century. Presumably,

too, such an evolution in East Asia would be

encouraged by timely help from the United

States and other major global players with an

interest in the region’s peace and prosperity—

again, just as Europe’s postwar success is partly

explained by U.S. policy during the Cold War.

Finally in this view of East Asia’s future,

a growth in living standards, higher educational levels supporting a technologically

driven economy, and the relative openness of

governments required to sustain an entrepreneurially-minded business culture, would all

conduce to positive changes in the social a

tudes of younger generations. This does 

imply that economic modernization point

one set and one set only of attitudi

patterns—i.e., Western ones. But many tra

tional East Asian attitudes—the emphasis 

community and extended family as oppo

to the individual; toward social hierarch

expressed through traditional occupatio

age, and gender roles; toward educational 

stitutions; toward paternalist social autho

vested in government—would proba

change. Thus, East Asian cultures could co

to accept, on indigenous cultural ter

values more harmonious with representa

democracy and greater personal liberty t

has heretofore been the case. 

I

f East Asia develops in such a fashion

something like it, nearly everyone in 

region and beyond it will be better off, and U

national security concerns with East Asia 

probably be modest. But there is no guaran

that it will develop so benignly. Plenty of thi

could go wrong, and some of them proba

will.

An optimistic appraisal of East As

future is predicated in large part on an assum

tion: that the rising tide of econo

development, buoyed by both a dynam

infused by major technological innovations 

a more integrated international economy, 

bring benign political and social developme

in its wake. There are plenty of examples 

human history, however, of parochial polit

interests—if not sheer irrationality, ideolog

rigidity, and myopic leadership—foiling s

scenarios. After all, if enabling glo

economic patterns and a skilled popula

with an affinity for science and technol

were all that really mattered, then it would 

impossible to explain the Japanese econo

doldrums of the past eight years. Sclerotic 
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

stitutions and poor executive decisions clearly

matter. 

So what could go wrong for East Asia over

the next quarter century? Three things come to

mind: economic meltdown, major upheaval in

China, and a serious spiraling downward of

geopolitical stability among China, Japan, and

Korea. Let us take them in turn.

Alarge-scale Asian or global recession

could occur, leading to widespread

unemployment, social instability, increasing

nationalism and protectionism, and heightened

political repression in several East Asian countries. To see how the latter could occur, all one

need do is examine the case of Indonesia. As

Indonesia’s economy began its free fall in late

1997, the wheels were set in spin for the fall of

its government, murderous attacks on its ethnic

Chinese minority, and the rise or reanimation of

several secessionist movements.

In contemplating the social and political

volatility that could issue from an economic

downturn in East Asia, one must start not from

theoretical speculations but from the actual situation extant today. Despite recent signs of

recovery, large parts of the region remain in

disastrous shape following the financial crisis

of 1997, with falling incomes and sharply

rising poverty levels. Meanwhile, the rapid

social change and attendant dislocations caused

by earlier bouts of globalization, urbanization,

and rising educational and economic expectations continue to flow through the affected

societies. Seen against the dashed hopes of

recent years, another cycle of boom and bust

could touch off significant violence and a sharp

backlash against enemies of the region, perceived or real, between now and 2025. That, in

turn, would amount to a huge waste of human

potential. Lives preoccupied by fearful, embattled conditions rather than engaged in scientific,

commercial, and cultural pursuits would tra

late at the least into fewer gains from tra

fewer investment opportunities, and fewer E

Asian children nurtured to contribute positiv

to global knowledge and culture. 

Widespread East Asian economic trou

could also lead to virulent anti-Americanism

backlash against the United States could 

based on claims of U.S. insensitivity to E

Asian suffering or to U.S. “cultural imper

ism,” particularly as expressed through U

influence over International Monetary F

(IMF) and World Bank policies. U.S. pu

opinion, in turn, could move increasingly aga

liberalized trade in view of mounting U.S. tr

deficits and losses of American jobs, as E

Asians once again try to export their way ou

their economic problems. U.S. protection

would worsen any regional or incipient glo

economic recession many times over, leadin

a vicious downward spiral.141 Protectionist s

timents, were they to be deep and long las

enough, could also encourage isolatio

impulses, and lead the United States to dis

gage from East Asia. 

How likely is that possibility? An ans

may start from the simple observation that 

Asian economic crisis that began in July 199

still under the analytical knife. Some argue 

structural defects in East Asian econom

caused the crash, and that once bloated to a 

ficient level, the bubble economies of the reg

inevitably had to burst. Others argue that 

herd instincts and poor risk management 

Western speculators and financiers were pri

pally to blame. And still others believe that 

international economic policies of the U.S. g

ernment were insufficiently attentive to 

limits of East Asian institutions, and that I

141 See Peter Schwartz and Peter Leyden, “The Long Boom

History of the Future, 1980-2020,” Wired, July 1997.
U.S. Commission on National Security/21st Century 

76 NEW WORLD COMING

policies made things worse than they otherwise

would have been. Depending on which explanation one accepts, divergent explanations for why

some countries were not hit as hard as others,

and why some have recovered faster than others,

follow in turn. Proposals over how to regulate international financial exchanges and reform the

IMF also invariably raise contentious debate, all

of which shows that there is no consensus about

what went wrong or how to prevent it from happening again. Since the urgency of reform has

waned as many countries have managed to set

themselves aright, even without fixing most of

their structural flaws, it could very well happen

again.

But of all the potential problems that

could throw East Asia for a proverbial

loop, none is as portentous or controversial as

the future of China. China is so huge, even

relative to its Japanese and Korean neighbors,

that it is bound to affect East Asia’s future. If

Chinese authoritarianism decompresses as per

capita income reaches around $7,000, (as several

observers have predicted), and the political

system moves toward bounded pluralism even if

not genuine democracy, optimism about East

Asia’s future would receive a major boost.142 If

China undergoes major political reform after the

terminal but essentially peaceful crisis of the

communist system, leading to the creation of a

parliamentary system no less democratic than

that in Taiwan, then so much the better still. 

Under either scenario, with its state-owned

enterprises and its banking system successfully,

if painfully, reformed, China’s GDP could be the

largest in the world in absolute terms in 2025.143

China’s share of global GDP could shoot up

from about 8 percent in the late 1990s to about

14 percent. China would also be a major source

of international financial liquidity. With dependencies and economic interests around the

globe, China would conduct itself as a m

world power, with active policies outside 

Asia. 

Such a China would not necessarily have 

reconcilable conflicts of interest with the Un

States or other major powers. Presumably, e

a China energized by broad, rekindled natio

ist sentiment would be constrained by its m

crucial linkages with international economic 

political institutions. China will require 

enormous amount of energy, more than tw

what it consumed in the late 1990s whe

burned one of every three tons of coal wo

wide. Even with better-developed hydroelec

coal, and domestic oil resources as princ

sources, China’s requirements for imported 

will rise from a projected 1.4 million barre

day in 2000 to 5.2 million barrels a day 

2020.144 The parade of supertankers stream

to Chinese ports would be vulnerable to in

diction in a crisis. China would share with o

major oil importers in East Asia, such as Jap

a strong interest in keeping oil flowing from 

sources and keeping strategic sea-lanes op

Beijing might also foster positive economic, 

litical, and security relationships with key 

producers around the globe, especially 

Central Asia, Russia, and the Near East. T

may lead China to fashion policies toward th

regions similar to those of the west Europ

countries; namely, a policy aimed at appeas

major regional actors in search of preferred co

mercial status.

142 For example, Minxin Pei, “Is China Democratizing?”

Foreign Affairs, Jan./Feb. 1998, and Henry Rowen,

“China: A Short March to Democracy?” The National

Interest, No. 45 (Fall 1996).

143 See note 53 for references and detail.

144 International Energy Outlook 1999 (Washington, DC:

Energy Information Administration, 1999), Tables A4
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

Still, historically, rising economic powers

have often caused the most trouble politically,

and nations sometimes put national pride and

place before objective material goals. Even a relatively liberal China will require American

vigilance. Should China spend most of the next

two and a half decades focusing on economic

development rather than military modernization,

it will still be a major regional military power by

2025. It will possess a strategic nuclear arsenal,

a robust theater missile capability, and regional

power projection capabilities in the form of a

limited blue water navy and an enhanced air

force. As a result, China will be a natural focus

of security concern for all states in the region as

well as for the United States. In consequence,

relative economic prosperity would enable other

states in the region, including Indonesia, the

Philippines, Vietnam, and perhaps even Japan to

increase spending on conventional weapons so

as to expand their regional power projection capabilities as a hedge against China. 

In such a circumstance, a liberalized, if still

not fully democratic China, would enjoy a mixed

relationship with the United States, one not radically different from that of the past decade.

Sino-U.S. ties would feature some cooperative

bilateral agreements, including most likely confidence-building measures in the security

arena, arms control agreements, trade and investment, and scientific and cultural exchanges.

At the same time, the relationship would be

characterized by vigorous competition and

periodic episodes of significant mutual suspicion over issues such as managed trade,

intellectual property rights, arms sales policies,

industrial and security-related espionage, and

human rights. Chinese regional power, as it

applies to the Spratly Islands and the South

China Sea more generally, or to Taiwan, or to

China’s geostrategic competition with India,

will also be part of the broader picture. 

So will China’s relationship with Rus

Should Russia develop a form of nationalist 

thoritarianism as it picks itself up from 

present state of political lethargy and econo

decay, China may resume a strategic ente

with the United States. The logic of doing 

would be a variant on that which defined 

Sino-American relationship between 1972 

1989. Especially under circumstances in wh

China was drawing heavily on U.S., Europe

and Japanese resources and institutions 

tackle its internal problems, Beijing mi

assume a generally benign leadership role 

East Asian security affairs and in the Un

Nations. In other words, China could beco

an incipient great power with a moderately 

fundamentally more liberal political order.

But there are at least two other possi

ities for China’s future, and they 

far less positive from a U.S. perspective.

One is that China continues to get rich, 

Chinese authoritarianism remains. For ris

income levels to translate into political plu

ism, an intervening process must occur: 

creation of a middle class ready and willing 

articulate its interests. For a variety of reaso

this might not happen in China.145 The coun

could instead metastasize from what wa

communist command economy into a loo

corporatist system, bound together by 

network of interwoven political, military, 

economic elites, and sustained at large 

appeals to nationalism. Such a polity, foun

on the greed of the elite, the will to power, 

the manipulation of the masses, would 

endear itself to the leadership of other m

economic powers. Nor could it expect part

larly close and sustained linkages to 

145 See David Zweig, “Undemocratic Capitalism: China an

the Limits of Economism,” The National Interest, No. 

(Summer 1999).
U.S. Commission on National Security/21st Century 

78 NEW WORLD COMING

growing international economy. Should it fail

to deliver the goods economically, such a

regime could all the more easily end up falling

into aggressive regional policies, as have past

corporatist and especially fascist and neofascist states.

Such a new nationalist China could become

decidedly hostile to the United States, and that

hostility could be reciprocated. Several triggers

for such hostility exist even today, and they will

not go away soon. One is a crisis over Taiwan

in which the United States strongly sides with

Taipei, a crisis made much more likely by

Taiwan’s renouncing of its “one China” policy

in July 1999. A second is a Chinese movement

to seize the Spratly or the Diaoyu islands, accompanied by clashes against Filipino,

Vietnamese, or Japanese forces. A third is an aggressive Chinese military armament program. A

fourth is domestic turmoil that Chinese political

impresarios rush to blame on the United States.

A fifth is the bloody repression of political reformers or ethnic minorities. And another is a

spate of U.S. policies that make small irritants

worse instead of major problems better.

In this degenerative case, the United States

would probably seek to balance a hostile China

by strengthening bilateral security agreements

with regional states and seeking additional

basing facilities in the area. The United States

might also sharply limit private sector trade, investment, and transfers of technology to China,

as well as place sharp limits on U.S. travel to

China and on the numbers of Chinese nationals

studying in the United States. Whether U.S.

allies in or outside of Asia would support such

actions is uncertain, absent a major Chinese

provocation. For this reason alone, and also

because there would be only a limited communist ideological component to Sino-American

hostility, it would be misleading to analogize

such a situation as a “new Cold War” or a new

form of “containment.”

Another possibility is that China collap

politically and violence erupts. Elements of a 

tential collapse are not hard to find. They incl

all of the following: the loss of ideological le

imacy on the part of the Communist Pa

massive corruption among the political 

economic elites, the pressure of separatism 

Tibet and Xinjiang, a failure to reform the st

owned enterprises that produce simultaneous

budget default and massive unemployment, 

creasing economic demands from a gray

population, the continued rise of anti-modern 

ligious/martial arts cults, and a series of p

political judgments. A collapse could produc

return to warlordism, economic disaster, hum

itarian catastrophe, the potential scattering 

China’s weapons of mass destruction, terrori

and massive black markets run by organi

criminals with links to crime syndicates out

of China. Just as Russian weakness has com

plague U.S. national security policy, so ac

Chinese weakness might do the same. 

No one knows what China will look 

over the next 25 years. The only thing that see

truly clear is that the status quo cannot per

The notion that China could grow economic

between 6 and 10 percent each year for 25 ye

and still be governed by a sclerotic Chin

Communist Party is simply beyond creden

Something has to give, but the predicates 

what that something will be remain unclear.

Aside from a regional or glo

economic downturn and the poss

transformation of China into a major problem

third worry is rather old-fashioned: the dest

lization or mismanagement of the regio

balance of power. 

In East Asia, three nations form the 

pivot of regional geopolitics: China, Japan, 

Korea. It may seem odd to minimize the imp

tance of such major states as Indonesia (

million people), the Philippines (78 mil
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

people), and Thailand (60 million people), to

name just three. And yet it is true. 

Of course, this does not mean that other

countries are of trivial significance. Indonesia is

the world’s fourth most populous country and

home to the world’s largest Muslim population.

It has played pivotal roles in ASEAN, ARF, and

APEC, has supported UN peacekeeping operations, has been involved in global disarmament

efforts, is rich in oil, and straddles some of the

world’s most critical sea lines of communication.146 The outcome of Indonesia’s economic

and political restructuring will play an important role in the future stability of East Asia. A

democratic Indonesia that peacefully resolves

separatist claims could capitalize on its demographic and economic potential and be a

stabilizing force in the region. Conversely, if

Indonesia’s military turns against the democratic process or if separatist movements

multiply and undermine the cohesion of the

state, this archipelago could inundate its

neighbors with refugees and become a harbor

for international criminal and other elements.

The break-up of the country, or its collapse

into a multifaceted civil war, would be both a

political and humanitarian nightmare for the

entire region. 

Southeast Asia, too, is important to U.S. interests. Not only is this region likely to play a

more important global economic role, but it is

an area to which competition among China,

India, Japan, and Korea could flow, especially

if the area itself becomes unstable. It is also an

area in which elite attitudes toward democracy

are very mixed, and it may thus become an important stage of ideological drama over the next

quarter century.

Nevertheless, the geopolitical triangle

formed by China, Korea, and Japan matters

most to the United States. It is an extraordinarily complex, yet familiar, triangle. In a wo

where global economic integration and tech

logical dynamism take rhetorical pride of pl

and where economics is often believed to tru

the hoariest political legacies, geopoli

seems to grow pale. But the level of mist

and outright fear among these three countrie

a reality that will endure. Chinese polit

elites and intellectuals resent Japanese succ

es and yearn to reestablish Chinese natio

dignity, somewhat at Japan’s expense. Ne

all Koreans resent Japan as well, but 

moving too close to China. The Japanese 

Chinese and Korean revanchism, and th

pacific and generally mercantilist attitu

since World War II have been unable to fu

overcome historical legacies. Added to this 

is the influence of both Russia and the Un

States, which for reasons both geographical 

historical are bound to and will invariably 

fluence this triangle.

The spark that could ignite a conflagra

among this triangle could fly from a nationa

tic and aggressive China, a nationalistic 

nuclear-armed reunified Korea, or a milita

assertive Japan. It could also arise from 

steady accretion of Chinese strategic mili

power that comes to undermine the credibi

of both explicit and implicit U.S. security gu

antees to Japan, Korea, the Philippines, 

other countries. But as historical analy

teaches us, the timing and the order of s

shifts would be crucial, and knowing 

timing and order beforehand is virtually 

possible. 

Korea seems the most likely starting po

for major change. But we do not know exa

what change in Korea will look like. If 

aging Stalinist regime in North Ko

146 U.S. Department of Defense, The United States Securit

Strategy for the East Asia-Pacific Region 1998, p. 36.
U.S. Commission on National Security/21st Century 

80 NEW WORLD COMING

suddenly collapses under the weight of its

own atavisms, and a new leadership in

Pyongyang essentially throws itself upon the

mercies of the government in Seoul, Korean

reunification will still be a mammoth task. It

would be even greater, however, if reunification is preceded by a desperate war launched

by a panicky North Korean leadership.

Japanese reactions to such a war would either

vindicate or deeply erode the U.S.-Japanese

security relationship. 

It does not take much imagination to

envision a major shift in the East Asian

geopolitical triangle if Korea does not dismantle the North’s nuclear weapons program

upon reunification. That shift would be even

greater in magnitude if Japan and the United

States part ways as a result of the events surrounding Korean unification. Under such

circumstances, Japan would face pressures to

become a nuclear weapons state. The triangle

could then be composed of three mutually

suspicious, nuclear-armed states. 

It is not hard to see the predicates for a

“go it alone” scenario in Tokyo, even though,

on balance, it is not very likely to occur. It

could go something like this. Under the best

of circumstances, Japan’s share of global

GDP will have dropped from about 8 percent

in the late 1990s to roughly 4.5 percent by

2025.147 For a political culture that has based

its self-image almost exclusively on economic

success since 1946, this is not good news. 

But the best of circumstances cannot be

guaranteed. The economy may shrink dramatically if Japanese leaders fail to introduce

effective economic and financial reforms. The

political system could remain essentially paralyzed. After years of negative economic

growth and a severe pension crisis touched off

by Japan’s graying population, the political

stasis in Tokyo might finally break op

Having persuaded the country to reempha

Japan’s military traditions, a new party co

come to power dedicated to restoring natio

pride and competing with a rising China. S

a coalition of conservative leaders would br

Japan’s bilateral security agreement with 

United States. Meanwhile, American lead

could miss the early signs of major chan

frustrating the Japanese even further and c

tributing to their alienation from the post

partnership. 

So a shift in the triangular relations

might commence from a point other t

Korean unification. It is also altoget

possible that Korean unification could 

delayed for another 20 years or more. Bey

rebuilding the economic infrastructure, 

South understands the huge task of integrat

such a poor population of 25 million peo

not to speak of the enormous difficulty of 

mobilizing, retraining, and employing 

hosts of a 1,144,000-man North Kor

standing military force. And unlike Germa

where nationalism drove reunification, Kor

nationalism sits better historically with 

divided peninsula. Seoul may thus be con

to let the United States and others tend t

decrepit North Korea as an international w

a tack the North Korean leadership would 

147 The Ministry for International Trade and Industry (MIT

estimates that even if Japan emerges from its current

eight-year recession, it cannot expect more than a 1.8

percent growth rate between 2000 and 2010, and a pal

0.8 percent thereafter. These estimates, which take int

account Japan’s sharply aging population, its bank deb

and its decline in productivity are optimistic. The well

regarded nonprofit affiliate of the Nikkei newspaper g

in Tokyo, the Japan Center for Economic Research,

projects near zero growth through 2003, and then a lo

gradual shrinkage in GDP after that out to 2025. See P

Harcher, The Ministry (Cambridge: Harvard Business

School Press, 1998).
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

doubtedly prefer to the “East German alternative” of closing up shop for good. If that

happens, Korean unification could be a very

protracted, perilous, and expensive task. 

If the tectonics of this triangle do shift, it

will set off major changes with which the

United States, by dint of the entanglements of

postwar history, will have to deal. This is

because the United States remains the only

country external to the region with both the

power and the desire to balance off local states

and promote stability through reassurances to

all three countries. The U.S. presence in East

Asia has been, and will continue to be, critical

to the region’s stability and prosperity.

Regional fears of China could lead to a continuing and even an expanded U.S. military

presence in East Asia. Yet a host of regional

and national changes could place pressure on

the United States to reduce or withdraw that

presence. It is even possible that pressures for

and against the U.S. military presence in Asia

will be brought to bear simultaneously.

One general source of pressure for

reducing the U.S. military presence is that

overseas basing is becoming more vulnerable

to a wider number of countries that could use

ballistic missiles armed with weapons of mass

destruction. That could make U.S. bases potential sources of danger rather than bulwarks

against it, and raise their political and

monetary costs.148 Overlapping political pressures could also arise. As noted, a major sea

change in Japanese politics could lead to a

sharp reduction or even an elimination of U.S.

bases in Japan. A reconciliation on the Korean

peninsula would eliminate the most obvious

and immediate justification for U.S. bases

there.149 Reunification could also stoke Korean

nationalism, and simultaneously convince

American public opinion and the Congress that

a U.S. military presence in East Asia is 

longer a necessary or a wise investment. 

Ultimately, however, whether 

positive potential of East Asia 

realized, or whether a less sunny future i

prospect, depends less on U.S. policy than 

the initiative, discipline, and foresight 

East Asians themselves. Those prospects w

also be affected powerfully by the course 

the global economy, over which U.S. gove

ment policy has an important but lim

influence. It will also be affected by whet

the potential for significant internal and 

ternational violence in the region 

restrained, and here the skill with which 

United States serves as an engaged balan

could be a major factor.

Clearly, a reduction of U.S. commitm

and engagement in East Asia, especially 

is simultaneously abrupt and deep, w

increase the likelihood of instability as sta

struggle to define a new regional balance 

power. From a strategic point of view, the 

sential U.S. choice may boil down to t

either remain engaged at greater short-te

peril and political cost to ourselves, or dis

gage at the potential cost of greater long-te

peril to everyone. 

The Greater Near East

The Greater Near East—defined her

the Arab world, Israel, Turkey, I

Central Asia, the Caucasus, and 

Subcontinent—is the site of the world's larg

supply of fossil fuels and a place where sev

ambitious powers actively seek regio

148 See Bracken, “America’s Maginot Line.”

149 It would also put U.S. forces in a country with a land

border with China, obviously affecting the political in

pretation of those forces.
U.S. Commission on National Security/21st Century 

82 NEW WORLD COMING

hegemony. It is a region where the United

States has key allies as well as important interests, and where weapons of mass destruction

are being actively developed. Not entirely by

coincidence, too, it is the place where the

United States fought its last major war, in 1991,

and it is the only region of the world where

more or less permanent U.S. forward-based

military deployments have expanded since the

end of the Cold War.

Hence, the Greater Near East is appreciated in the West as a region of great importance

but also great trouble. This is undoubtedly so,

even if one sketches the region without reference to U.S. interests. Despite unprecedented

prospects for Arab-Israeli reconciliation, the

area still exhibits many and sundry depredations. It has a high concentration of despotic

regimes and, aside from Israel, India, and

Turkey, no institutionalized democracies. It is

also the site of politically radical, militari

Islam, which, if not a mortal threat to its h

societies and to neighbor states alike, is at l

a significant irritation and source of instabi

Several parts of the region—Lebanon’s Be

valley at one end and south central Afghanis

toward the other end—supply a large volum

illicit drugs to many parts of the world. 

area is also a cauldron of sectarian rival

among Sunni and Shi`a Muslims; betw

Muslims and Hindus, Jews, Coptic Christia

and Bahais; and between Hindus and Buddh

in Sri Lanka. Ethnic violence within and am

countries involving Kurds, Turks, Ara

Persians, Armenians, Azeris, Singhale

Tamils, and others is bountiful. Finally, on

hard pressed to think of any 25-year period 

the documented history of this diverse reg

when there has not been at least one m

spasm of civil or cross-border warfare. 
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

As one looks toward the future, such alegacy is perhaps disheartening. But

there is yet more. Beyond the region’s checkered past, the next 25 years pose potentially

wrenching and destabilizing change. That

change will come in at least three forms. 

First, whenever a great empire collapses it

produces a shatterbelt of instability around its

periphery, one that usually lasts for many years.

The headlong collapse of Russian power is a

pertinent example for the Greater Near East.

For the first time in more than three centuries,

three core countries of the region no longer

directly abut Russian power: Afghanistan, Iran,

and Turkey. Traditional commercial and

cultural contacts between lands south of the

Oxus River and those beyond it in Central Asia

have been restored after nearly a century of interruption. The Silk Road is slowly being

revived, and patterns of exchange have begun

to appear more reminiscent of the 15th and 

centuries than of the 18th or 19th. Not only h

Muslim Central Asia and the Muslim peop

of the Caucasus been reunited with the res

the Near East, so to some extent have 

Muslims of the Balkans thanks to the extre

ly painful slow-motion collapse of Yugoslav

Farther east, the collapse of the So

Union left India without a superpower patro

balance China, which in turn accelera

India’s desire to demonstrate open nuc

weapons possession. This is a fact of geopo

cal life no less clear than the fact that the So

collapse has allowed China to rebalance 

military attentions away from the Russ

border and toward the South China Sea. Ind

test was also the spark for Pakistan’s pu

nuclear arrival, and that, in turn, has m

Iranian aspirations to acquire a strate

balancer virtually impossible to slake—

Areas of Conflict
U.S. Commission on National Security/21st Century 

84 NEW WORLD COMING

that aside from the threat to Iran from the all

too obvious Iraqi efforts to obtain weapons of

mass destruction.

So far, the post-Communist shatterbelt has

produced or prolonged war “only” in the

Balkans, the Caucasus, Tajikistan, and

Afghanistan. By historical standards,

however, it is still too soon to conclude that

the dust has settled. The number of wars,

small and not-so-small, that even reasonably

sanguine analysts may justifiably expect to

see in this region over the next 25 years is

large. Several could be attributed to the aftershocks of the Soviet collapse.

A second source of change has been noted

above: demography. For the first half of the

period out to 2025, most of the countries of

the Greater Near East will experience rapid

population growth and a significant drop in

the mean population age. A youth bulge is

making its way through many populations in

the region, due in part to health and sanitation

improvements and in part to the demographic

momentum from an earlier population boom

in the 1970s and 1980s. Such population

dynamics pose severe challenges for many societies. They strain the natural and social

environments through the need for potable

water, housing, education, and medical

services.150 Unemployment, income disparities, and ethnic tensions generated by such

problems may also contribute to significant

internal migrations, largely from countryside

to towns and cities, and some cross-border migration as well—including into Europe.151

Toward the middle of this period through

2025, increased urbanization and female

literacy will probably cause birth rates to progressively drop, and pressures on services will

subside to some extent.

A third source of change has been 

hearsed in some detail above: the tumult 

may expect from the continuing economic 

tegration of the globe. Even a mainly ben

successful process of integration will introd

many stresses to the non-Western cultures 

this area. Secularization is but one; new n

universal norms of Western origin concern

human rights, minority rights, and particul

women’s rights are another. Should glo

economic integration produce repeated cy

of boom and bust, should it produce patchw

polarizations of success stories and failu

within regions and countries, or should 

empower certain states and groups milita

so as to produce sudden perturbations 

security relations, the region could succum

very harrowing times.

One might gather from the forego

that the Greater Near East will no

a prime zone for enterprising America

Japanese, or Europeans to go sell insuranc

take leisurely vacations. Not necessarily. J

as in Greater Europe and East Asia there 

optimistic as well as pessimistic possibili

with which one may view the future, suc

also the case in viewing the Greater Near E

What could go right amid so many po

bilities for trouble? The answer is plenty, 

one of the main reasons, interestingly enou

lies in the social power of religion to abs

the shocks of globalization.

Some large and important countries in 

region may well break the spell of étatism 

tie themselves more fully into the glo

150 See Population and the World Bank: Adapting to Chang

(Washington, DC: The World Bank, 1999), pp. 8-9.

151 Of the 170 million people living around the Mediterran

in 2025, 10 percent will be European, 22 percent will 

Turkish, and about 68 percent will be Arab.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

economic system. At the least, the top managerial echelons of business and government will

be fully up-to-date in nearly all oil-rich countries and most others as well. Israel and a few

of the Arab states (most likely Qatar and the

United Arab Emirates, and possibly Iraq and

Saudi Arabia as well) will feature fully modern

economies; India, Iran, Egypt, Turkey, and a

few other regional states will have, at the least,

very modern sectors within their economies. As

a result, both extra-regional and intra-regional

trade as a percentage of national gross domestic

product will climb from late 20th century

levels. Several countries in North Africa—

Morocco, Tunisia, a recovered Algeria, and a

post-Qadaffi Libya—may attract substantial

funds from East Asia both as investment in

their energy resources and as ways to penetrate

into Europe via European Union trade agreements with North African states.

Led by a new generation of mainly

Western-educated elites, some countries—especially but not exclusively oil-rich

countries—may also become both successful

niche producers and major international financial hubs, following the 1990s model of the

United Arab Emirates. Economic restructuring

and advancement could transform several

regional states into important capital markets,

and better than 4 percent yearly growth rates in

GDP are not out of the question even for the

majority of regional states. The establishment

of an effective Middle East Development Bank

that would help stabilize the region’s oil havenots is not out of the question either.

One result of rapid growth, no doubt, will

be greater economic disparity among regional

states between those that are plugged into the

world economy and those that are not.

Whereas in the last quarter of the 20th century,

intra-regional economic differences were explained mostly by the chance occurrence of

fossil fuel deposits, in the first quarter of 

21st century even greater differences will 

explained mainly by different levels achie

in the development of human capi

economic openness, and political dynami

But the most important thing is that all co

tries in the region will see that real change, 

real success, are possible. If Saudi Ara

Iran, Turkey, Israel, Egypt, and India, to na

the major players, achieve an economic ta

off in tandem with the tides of global econo

integration, the region will never again be 

same. 

There is no question, in any event, that 

raw resources will be in place to finance s

growth. Some $500 billion in Arab money 

in banks and investments outside the A

world. If economic rationalization can br

most of that money back into the region, 

pool of investment funds will be enormo

Turkey may attract funds as well from ot

Turkic-speaking regions: Turkmenistan, r

in natural gas, Azerbaijan, which sits on 

and gas, and even Uzbekistan, the largest 

perhaps in the future the most economic

dynamic of the Turkic-speaking states 

Central Asia. India is so large that it 

generate most of its own capital, although 

tremendous infrastructure requirements co

easily absorb all its capital and more. Is

will attract funds from the world over due 

its special richness in human capital attune

the information age.

And that is not all. Japan, Europe, In

China, and most of developing East Asia 

remain heavily dependent on oil and natural 

from this region. Chinese dependence on b

Persian Gulf and Caspian Basin oil and gas 

grow sharply. Investment in the Near East 

East Asians should also expand. In short, th

will be plenty of money around to finance 

growth. 
U.S. Commission on National Security/21st Century 

86 NEW WORLD COMING

Moreover and more important, new

wealth may have significant positive

political implications. Virtually all national elites,

and much of the middle class strata, will be connected technologically to the developed world.

The demonstration effect of such new technology, including its pop cultural forms, will initially

exacerbate social divisions within countries and

make the task of authoritarian control more difficult. New wealth will also likely spawn new

corruption, and new reactions to that corrupt

Also, to the extent that growing literacy rates 

urbanization connect over time with increa

computer literacy and the availability of techn

ogy for large numbers of people, authorita

control will grow more difficult still.152 Thi

because such a connection may challenge b

traditional government control of signific

commerce as well as traditional attitudes tow

education and educational authority; signific

Global Shares of Oil Production

152 The Al-Jazira television network, based in Doha, Qatar

become enormously popular in the 22 Arab countries

where it can be viewed. It has also generated much fe

and loathing among authoritarian governments for wh

objective news programming and intellectual opennes

threat. 

Sources: Adapted from International Energy Outlook 1999 (Washington, DC: Energy Information

Administration, 1999), Appendix D; and British Petroleum, Statistical Review of World Energy, 1997.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

anti-authoritarian social implications flow from

both. The weakening and potential transformation of Near Eastern autocracies, if it does not

come too suddenly, stands to do enormous good

for the region.

The political implications of such a weakening, however, could include a danger of populist

demagoguery as well as greater political pluralism. But if the latter should dominate the next 25

years, the politics of the region will have taken a

major step forward. The very dangers of social

disruption will perhaps furnish the incentive to

change if economic, social, and demographic

pressures are strong enough to persuade governments to open up, but not strong enough to

overwhelm them before their new approaches

can bear fruit. Political liberalization largely

driven by economic reform could well take root

in a number of Arab countries (Morocco, Jordan,

and Tunisia are likely near-term candidates),

leading to still further pressures against authoritarianism in neighboring states. 

Governments may also usefully employ the

growing social authority of Islam to reinforce political community rather than try to control,

manipulate, or extirpate Islam as many have done

in the past. As one country after another opens up

without triggering massive political tumult, others

are more likely to follow suit. With prudent

economic and political encouragement from

outside the region, each opening would reinforce

the other economically and psychologically, and

in time the large majority of regional societies

would find ways to adjust to new circumstances.

Their Islamic societies cohere, and by and large

their governments, sensitive to religious strictures,

would work.

One cannot stress too much the potential

significance of religious culture here.

Islam is an increasingly significant social force

throughout the Muslim states within the region,

but mostly in the form of neo-orthodoxy, not f

damentalism—and the differences between th

are crucial. Islamic neo-orthodoxy is nei

militant nor expressly political in nature, 

exerts an increasingly powerful social force 

several societies (including current U.S. al

such as Pakistan, Egypt, and Turkey) 

strongly influences—and at times embodie

political movements, alignments, and moo

Meanwhile, highly politicized fundamenta

challenges to states are waning, and no Mus

countries, beyond Iran, Afghanistan, and Sud

are likely to develop theocratic governments o

the next quarter century.

Contrary to what some outside the reg

think, there is no plausible means of social m

agement and adjustment to vast change in 

Muslim world outside of Islam. For th

cultures, the process of secularization, associa

organically in the West with the Enlightenm

the Reformation, and the Industrial Revolut

simply never happened, and so carries almos

social resonance.153 But Islam is potenti

capable of supplying such a means of adj

ment. Judging by what engaged middle cla

in almost all regional societies are reading 

debating nowadays—where a tremend

interest in adapting religion to modernity 

underway—there is some prospect that th

traditions will be up to the task.154 Add to 

153 See Ernst Gellner, Nationalism (Washington Square, N

New York University Press, 1997), chapter 13. 

154 There is foremostly the remarkable example of Muham

Shahrur’s Al-Kitab wa-l-Qur’an (“The Book and the

Qur’an”), which has sold tens of thousands of copies

throughout the Arab world since it was published in 1

Shahrur, a Syrian engineer, argues for a reformist Islam

that comes to terms as equal partners with modernity.

Some clerics have banned it and pronounced it heresy

that has not stopped people from reading and discussi

in unprecedented numbers. Similar phenomenon may 

noted in Turkey, Bangladesh, Indonesia, Morocco, Eg

and elsewhere
U.S. Commission on National Security/21st Century 

88 NEW WORLD COMING

the impact of mass education and mass communication, and it becomes clear that vast and

potentially very positive changes are afoot in the

region where it matters most: on the street.

One crucially important aspect of change

within Islamic cultures over the past several

decades concerns the role of women within

Islam. This has become the touchstone social

and theological issue in many societies, and

one that is widely misunderstood outside the

Muslim world. When an Egyptian, Turkish, or

Pakistani woman chooses to don a headscarf, it

does not necessarily mean that she or her

husband has become an “Islamic fundamentalist.” More likely, this is an example of

neo-orthodoxy in action. She usually does it not

because her mother and grandmother did, but

because they did not. In other words, such

behavior today is generally associated with

upward mobility, urbanization, and greater

literacy. Increased personal piety is thus often a

function of the movement from a mimetic to a

textual reading of religious tradition. This

movement is aided not only by increased

literacy but also by urbanization, for urbanization represents the shift from the

Sufi-influenced folk-religion of the countryside

to the “high” literate Islamic traditions of the

city.155 Neo-orthodoxy is not socially regressive, nor is it primarily political in motive. It

also suggests more, not less, participation in

public life by women, particularly as the percentage of literate women continues to increase

throughout the Muslim world. 

I

f Islamic reformism, propelled by

changes in technology, economy, and

society, comes to dominate the political

processes of most majority Muslim cultures, it

is at least possible that no major war will have

occurred in the majority Muslim states of the

region by 2025. That would create a sense of

optimism and security that can further transform the landscape. One reason for thinking 

possible is the vast generational change n

taking place throughout the region. Sometim

the next 25 years, for example, there will 

generational change in the political leadersh

of Iraq and Iran (as well as those in Egypt, Sa

Arabia, and Syria), following recent successi

in Jordan and Morocco. If those changes a

prelude to reform and political moderation, b

countries could come to focus more on inte

economic and political development and less 

regional rivalries and investments in armame

It is also possible—even likely—that 

Iranian theocracy will collapse in the n

quarter century. Iran is an Islamic Republi

present, but it cannot remain both for long

will either stop being a republic and desc

into truly medieval-style rule, or it will s

being an Islamic theocracy. The battle for 

future has already been joined, but how it w

turn out no one knows. Should the curr

regime collapse, however, it would send sh

waves through the Islamic world and und

mine radical Islamist movements everywh

It would open the way for a U.S.-Iranian r

prochement that could have broadly posi

effects in the region and beyond. In turn, if 

theocratic regime in Iran and the Ba’

regime in Iraq are deposed or sharply mod

ated before they acquire and deploy nuclea

biological weapons, the pressures on ot

states to match step may dissipate. The th

to use all such weapons would also declin

regional political disputes fall to diplom

amelioration. The status of weapons of m

destruction would suffer, and the diplom

155 Here see Ernst Gellner, Post-Modernism, Reason, and

Religion (London: Routledge, 1992). A similar phenom

non in the movement from mimetic to literary traditio

has been occurring in Judaism, with some parallel effe

See Haim Soleveichik, “Rupture and Revolution: The

Transformation of Modern Orthodoxy,” Tradition 28:4

(Summer 1992).
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

and domestic political costs of building them

might come to exceed the presumed benefits.

The last stages of the Arab-Israeli conflict

could finally be set to rest with an agreement

that creates a semi-independent Palestinian

state. Peace would not be warm, and not all

Palestinians or Israelis would be reconciled to

the compromises involved. But the ongoing

dispute would be effectively isolated from

more portentious regional considerations

largely by dint of an Israeli-Jordanian understanding supported by the United States. 

Neither peace nor war will probably

continue between Israel and Syria, as Syrian

politics remains in Alawi hands and Lebanon,

for all practical purposes, remains in Syrian

hands. A real peace would be likely only

should there be a regime change in Syria, but

at present there is no discernable and effective

opposition to Alawi rule. On the other hand,

were peace agreements with Syria and

Lebanon to occur along with political normalization with Saudi Arabia—allowed by a

symbolic compromise over Muslim holy

places in Jerusalem—Israel might agree to

limit its nuclear program. It might even open

it to international inspection. 

Whether Israel makes peace with Syria or

not, closer economic and security ties between

Israel and Turkey are likely. An even wider association that might include Jordan, Azerbaijan,

and Kazakhstan is also possible. 

Even reconciliation between India and

Pakistan is conceivable, not least because the

threat of nuclear destruction may force both

parties to ultimately transform their enmity, or

at least to pursue it by non-violent means. That,

in turn, could lead to restraints on the part of

both countries in their further deployment of

nuclear weapons and missiles. Mutual agreement between India and Pakistan to abo

their nuclear weapons is not likely, un

somehow China and others would agree to 

the same—which is even less likely. But t

constraint could be formalized, and the Un

States and the EU might play important role

helping the two sides come to agreement.

Positive domestic developments may also 

in store for India. Many analysts believe 

India might be able to maintain economic gro

rates between 6 and 9 percent for most of 

period. If so, its aggregate economic strength 

equal that of the present day Chinese 

ASEAN economies combined. By 2025, In

will be more populous than China and, des

appalling poverty, will have the largest educa

middle class in the world in absolute terms

India may also remain a democracy, a tech

logically innovative society, and a proud 

confident cultural entity despite its m

enduring problems. Under such circumstan

India will play a larger and more varied rol

the region, one that could find itself in gen

consonance with U.S. interests. Israel 

India might also become important allies.15

Having paid our dues to optimism, 

would be remiss not to note the more pessimi

possibilities for the region. As suggested abo

there are many. 

The Greater Near East is a place—

unlike many others—where a very few posi

but seminal developments can go a long wa

156 India also has, however, a large majority of the world’s 

erate—nearly 500 million people. For a brief demogra

sketch, see Barbara Crossette, “In Days, India, Chasin

China, Will Have a Billion People,” New York Times,

August 5, 1999.

157 Israeli-Indian cooperation has grown markedly, if quiet

since 1994. See Ze’ev Schiff, “The Complex Israel-In

Connection,” Ha’aretz, August 19, 1998; and “India a

Israel vs Pakistan,” Foreign Report, June 11, 1998.
U.S. Commission on National Security/21st Century 

90 NEW WORLD COMING

insure peace and stability, but a few negative

ones can similarly cause enormous trouble. The

key to which direction the future will take

comes down to a relatively small number of

contingent events, namely whether major wars

can be avoided and whether regime changes in

major countries can proceed peaceably.

Avoiding major warfare and the occasional violent regime collapse will not be easy

over the next 25 years. There are many

pitfalls along the way. More than one major

regional war will probably occur, causing a

deterioration of the general regional security

environment, and making it more difficult for

any power or combination of powers to

moderate political enmities and minimize

local arms races. Consider the following list,

set down in rough order of the seriousness of

the potential conflicts. These conflicts are

discussed in conditional terms because, while

the potential exists for all of them to occur, it

is not possible to predict exactly which of

them will occur.

Iran and Afghanistan could well find

themselves at war over Taliban policies

toward Afghanistan's Shi'a Hazara population,

drug and weapons running, interpretations of

Islam, and sheer geostrategic rivalry. Such a

war might also involve Tajikistan and

Uzbekistan, each thinking to absorb the ethnic

Tajik and Uzbek populations of Afghanistan

north of the Hindu Kush, where the writ of the

mainly Pashtun Taliban does not run deep. It

could also pull in Pakistan, which in turn

could help destroy that country in its current

territorial configuration. The collapse of a

nuclear-capable Pakistan would quickly

become an urgent international security issue.

Such events, too, might then open the way for

an Indo-Iranian competition over the Punjab,

Sind, and Baluchistan. Both countries could

have nuclear capabilities by the time such a

contest would develop. In all this we se

quintessential example—one of a gr

many—of the mixing of internal conflict w

possible cross-border violence.

India and Pakistan might fall into a m

war as a result of miscalculation when figh

erupts in Kashmir—as it did in June 19

Another Sino-Indian border war is also possi

India believes that a slice of Kashmir is occup

by China.

Iran and Iraq will likely remain gener

hostile to each other and might again fi

over historical and ethno-religious enmity 

well as territorial disputes. Iraq and Tur

could find themselves at war over some co

bination of the Kurdish issue, water rig

and the ownership of Mosul and its oil r

environs. Syria and Turkey could also fal

blows over some combination of Kurd

issues, water rights, and the future of Hatay

Greco-Turkish war over the future of Cyp

too, might subsequently lead Syria 

possibly Iraq to launch a revanchist milit

campaign against Turkey.

In Central Asia, Kazakhstan and Ru

might struggle over northern Kazakhs

which is overwhelmingly ethnic-Russian 

population. The post-Soviet states of Cen

Asia could also become roiled in conflict o

the fertile and ethnically mixed Fergh

Valley. Uzbek nationalism may become disr

tive, clashing with a rising Tajik national

supported by Iran. Uzbekistan’s relations w

Kyrgyzstan might decline over water dispu

and the Kyrgyz may turn to a closer relati

ship with China for this and other reaso

Turkey and Iran could find themselves supp

ing proxy warfare between Uzbek and T

interests, or being drawn into war themsel

over spheres of influence and client relati

ships in Central Asia. In the Caucasus, 
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

Azeri-Armenian war over Ngorno-Karabakh

could flare up again, for it is unlikely to be

finally settled soon. Continuing Russian

meddling in Georgia and Tajikistan cannot be

ruled out. Iranian-Azeri conflict over Azeri irredentist claims is not out of the question either.

Existing Arab-Israeli political arrangements could also collapse. Egypt might defect

from the peace arrangement with Israel on

account of a change of regime in Cairo. A civil

war could erupt in the area of the Palestinian

Authority after the passing of Yasir Arafat,

with the consequent reshaping of Israeli and

Jordanian regional strategies. Contrarily, an irredentist Palestinian state might manage to

overshadow and envelop Hashemite Jordan,

and make common cause with both a postAlawi Syria and with a post-Saddam Iraq to

recreate an eastern front against Israel. Israel

might also be attacked by either Iraq or Iran in

a missile war over existential religious and

historical issues.

Even small wars could have serious consequences depending on where they are or

who fights them. A Saudi-Yemeni war over

the still disputed region of Asir is an example.

So would be fighting inside the Persian Gulf

between the United Arab Emirates, possibly

with Bahraini and ultimately Saudi support,

against Iran over Abu Musa and the Greater

and Lesser Tunbs Islands, UAE territory

occupied by Iran since 1971.

It is highly unlikely that all or most of

these conflicts will actually break out over the

next 25 years. But it is even less likely that

none of them will. 

As for regime change and national coherence, here we must return to the

sources of social and political instability

noted above, and examine their poten

downside.

It is possible that generational leaders

successions occur throughout the Arab wo

Iran, Central Asia, the Caucasus, and So

Asia, but the political characteristics 

global orientations of the major regimes n

ertheless remain basically unchang

Currently autocratic regimes may well rem

autocratic without having instituted sign

cant changes in their political structures. T

may resist pressures to change, and catal

no little violence in the process. Th

episodic social unrest, religious violence, 

ethnic conflict could characterize the dome

conditions of several states in the region. 

That unrest would most likely be t

gered in part by high population growth, 

also by economic stagnation. The elites 

major states may react to globalization p

sures with new forms of corruption and fa

crony privatization schemes. This is alre

the case in some respects, and it is not har

see why.158 Many regional elites are sim

doing what they have always done—tak

not making—in accordance with an attit

toward civic duty embedded deeply in 

fabric of the local political economy. H

states have more often than not functioned 

cording to a rentier model. While in m

countries citizens pay taxes to the state and 

state provides services, in many Arab count

the flow of money has been the other w

around. States accrue resources from exter

sources—oil revenues, port fees, bank

services, and so forth—and then distribute 

money as patronage down into the populati

The rentier model functions as a means 

158 See Ali R. Abootalebi, “Middle Eastern Economies: A

Survey of Current Problems and Issues,” Middle East

Review of International Affairs (Ramat Gan), Septemb

1999. 
U.S. Commission on National Security/21st Century 

92 NEW WORLD COMING

control for the state elite, but it vitiates the

ties of citizenship produced by a more

standard model of reciprocal obligation

between citizen and government. 159

This is an important factor militating

against elite support for any form of technology-driven entrepreneurship that the elite

cannot control. All non-hierarchical forms of

social power would upset traditional arrangements, and most elites will oppose it even at

the cost of overall economic stagnation. 

It is even possible that at least some

nervous governments will seek to maintain a

near total insularity against social pressures

and external allurements alike. They might

simply refuse to condone, let alone advance, a

more open attitude toward the outside world.

They may shun foreign investment despite the

knowledge that they may miss a great wave of

regional prosperity. If such an attitude is

limited to countries like Afghanistan, Yemen,

or Oman, the implications would be modest.

If it should come to influence Saudi Arabia,

Iran, and even an Islamist Pakistan, that

would be another matter altogether.160

It is also possible that Islam will not

provide a means to soften and advance social

change. One could argue that Islamic societies tend to cling to the two anchors of social

authority they best know and trust to ward off

chaos: religion and extended family. But

these anchors cannot solve the demographic

and social problems before them, and a

downward spiral of insularity and dysfunctional government may end up dividing such

societies ever further from the world’s successful models of development.

While it is not likely, it is possible that oil

and natural gas supplies from the region will

no longer figure prominently in global

markets, either because turmoil and conf

have disrupted their flow or because alter

tive sources of energy are developed. If 

were to happen, these countries could beco

dramatically poorer, and the stability of th

economies and regimes would eventu

become less important to the United Sta

and other major advanced countries, th

own lingering investment portfolios notw

standing. In any event, some of the sma

Gulf producers may reach the bottom of th

reserves over the next 25-years, and if t

have not managed to diversify by then, t

will go bust.

Contrarily, the absence of energy alter

tives, set against the inexorable limits of fo

fuel reserves, could lead to another sharp 

in prices between now and 2025. Oil-r

countries might then use bloated revenue

pursue regional political and military com

titions, as they did in the 1970s. Corrupt

would likely increase, as would resentm

against elites. Surely, another oil shock wo

send the international economy, or much o

once again into the doldrums, and that in t

would again spell disaster for the non-oil r

states of the region.

Very bad things could happen in 

broader security sphere as well. T

Greater Near East will remain heavily arm

and could be the region where the majority 

159 See Lisa Anderson, “Obligations and Accountability:

Islamic Politics in North Africa,” Daedelus, Summer

1991. The same is true to a certain extent in India, wh

only a quarter of 1 percent of the population pays taxe

160 Oman and Saudi Arabia have been the two most delibe

ly insular Arab states in modern times. Oman began

reducing its insularity in the 1970s; as a sign of the tim

in Saudi Arabia, in the fall of 1998 it became possible 

the first time for foreigners to get a tourist visa into th

country.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

new nuclear states emerge. Iran and Iraq are

real possibilities. Other states, too, such as

Egypt, Syria, Libya, Algeria, Saudi Arabia

and Morocco are keeping their options open,

even while remaining parties to the NonProliferation Treaty. Prospects also exist for

states and terrorist groups in the region to

acquire chemical and biological weapons.

Long range missiles are under development in

many countries as well. Over the coming 25

years, we should expect that such weapons

will be used in regional conflicts, as well as in

attacks against Americans abroad and

possibly at home. 

Extra-regional influences might also alter

the course of regional engagement for the

worse. Such forces, consisting mainly of the

United States, Russia, Japan, China, Turkey,

and the EU, might engage in sharp competition over regional energy resources and

political loyalties, leading local states to act

recklessly and violently. 

Political changes in regimes, especially

those in major states such as India, Egypt,

Saudi Arabia, Turkey, Pakistan, Iraq, and Iran,

could also lead to dramatic shifts in military

balances. This is a concern because, except in

India and Turkey, the processes of political

succession are not well institutionalized.

Some of these regimes could be overthrown

by revolution. It could be, for example, that

after two generations of a flowering of Islamic

neo-orthodoxy, the stage will have been set for

the reemergence of fundamentalist movements amid economic depression and the

failure of secular political parties to provide

viable political leadership. Regime upheavals

might therefore produce several ultra-conservative religious regimes in the region, each

successive case gaining moral and possibly

literal support from the ones before. Egypt,

Turkey, Saudi Arabia, or Pakistan—or several

of these states—might suffer major polit

upheaval and be transformed into activ

anti-U.S. regimes. In addition, and possibly 

multaneously, the internal stability of Pakis

could come unglued in the face of polit

paralysis and economic distress, with Pash

Baluch, and even mohajir groups seeking th

own states.

An anti-American regime in Sa

Arabia, one so antagonistic that it wo

refuse to sell its oil abroad, is not very lik

But were it to come to pass and be allowed 

stand, it would represent a major blow to 

liberal economic order brought into be

after World War II.

It is also possible that the internal stab

ty of India will decline sharply as Hi

nationalism roils the implicit social comp

of the multiethnic, multisectarian state. E

though the electorate may turn the ultra-

tionalists out of office, they may not acc

the verdict, but instead resort to extra-par

mentary violence that severely undermi

Indian democracy. India could even br

down as a national state, generating enorm

political and humanitarian crises over 

entire region for an extended peri

Obviously, a failure to prevent a major 

with Pakistan or China could trigger suc

disaster.

Beyond these two major poten

reasons for pessimism—the possi

ity of regional wars and destabilizing reg

change—there is a specific cause for conc

in the coming conflicts over water resourc

Such conflicts are particularly lik

between Turkey on the one hand and Syria 

Iraq on the other, and also potentially am

Egypt, Sudan, and Ethiopia. There is little 

tential for agricultural expansion in Egy
U.S. Commission on National Security/21st Century 

94 NEW WORLD COMING

which already achieves some of the highest

productivity-per-acre rates in the world, and

there is much potential for both drought and

for more Nile water being used by upstream

riparians.161

Water stress in the Jordan/Yarmouk valley

system among Israel, Jordan, and the

Palestinian Authority will likely be ameliorated by some combination of regional

cooperation on infrastructure modernization,

economic restructuring away from irrigated agriculture, sewage water recycling, water

imports, and desalination programs. Even

with present technology and at current costs,

it would cost about $4 billion (including the

major initial capital investments) to produce

700,000 million cubic meters of drinking

quality water through desalination for the first

year, and much less for each succeeding year.

That amounts to about half of the annual discharge of the Jordan river system, and would

make up most of the region’s prospective

water deficit. $4 billion is a lot of money for

a small region, but it pales besides the amount

of money spent on arms imports. If human

needs truly require it, governments and societies will find it affordable.

It is also possible that within 25 years economically sound ways will be found to tap

into large resources of fossil water deep

below the surface. Some geologists estimate

that beneath the the Negev and Sinai deserts

there may be reserves of potable fossil water

sufficient to last the entire Levant for more

than 250 years at current rates of utilization.

Finally, it almost goes without saying

that U.S. policy in the region will

make a difference. One possibility is that U.S.

policies, similar to current ones, will lead to

further pacification of the Arab-Israeli

dispute, but not to a stable natural balance of

power in the Persian Gulf or Southwest A

Domestic political turbulence would conti

to exacerbate interstate, inter-sectarian, 

inter-ethnic relations. As a result, the Un

States would retain a significant milit

presence and diplomatic profile in the regi

But two other possibilities exist. In o

the United States would not only persist w

current policies, but either definitiv

succeed or fail with them. In the second, 

United States would choose not to persist

If the United States persists and succee

it will mean that U.S. policies will h

brought stable peace not only between Is

and all the major Arab states, but also 

helping to shepherd transitions to peace

polities in Iran and Iraq, and a peaceful re

lution of the Indo-Pakistani conflict. Succ

would allow the United States to substi

much or most of its military presence in 

region for a more robust diplomatic, cultu

and commercial presence. Contrarily, U

policies could fail to prevent more seri

threats from arising, and the United Sta

might then increase its military prese

either to support a beleaguered Israel, 

contain the rise of a regional hegemon, 

prevent certain countries from acquir

weapons of mass destruction. From suc

failure the United States would risk, or go 

war.

The major alternative is that the Un

States might pull back from involvement in 

region. Two interwoven sources for suc

change exist. A lessening of common purp

with the regional states is one. An unwilli

ness on the part of the American public 

161 See Arnon Soffer, Rivers of Fire: The Conflict Over Wa

in the Middle East (New York: Rowman & Littlefield,

1999), pp. 49-50.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

support expeditionary military deployments is

another. That unwillingness could follow terrorist attacks on Americans or from perceptions

of U.S. vulnerabilities to missile attacks from

such countries as Iran, Iraq, Egypt, Pakistan,

and India. In short, the possibility exists that we

might not persist, succeed, or fail, but rather

disengage. 

Sub-Saharan Africa

Sub-Saharan Africa’s last four decades,

the decades of the independence

period for most of the countries in the region,

have been characterized by rampant instability, mostly despotic military rule, and

corruption unsurpassed in its sheer

venality.162 The region has experienced

frequent violent conflicts, including genocide

of Africans by Africans. While bloody

disputes over colonially drawn borders have

been less frequent than might have been

expected, such conflicts have taken place and

have recently grown in frequency and scale.

They pale only in comparison to the huge

number of internal upheavals, lately evidenced by major troubles in Angola, the

Democratic Republic of the Congo, Rwanda,

Burundi, Mozambique, Sierra Leone, Liberia,

and elsewhere. The continent has also been

home to massive organized criminal activity.

Infectious disease, malnutrition, and both environmental and refugee problems have

soared to catastrophic levels.163 Access to

quality education has been a rare privilege in

most countries. Shortages of fundamental infrastructure—roads, telephone services,

power, clean water, health care facilities and

trained personnel, trustworthy police forces—

have been chronic and severe in cities and

villages throughout the region. Today, for

example, there are more telephones in the

Borough of Manhattan, or in central London,

than in all of sub-Saharan Africa.164 A

economic growth has been anemic for 

most part, as populations have grown rapi

Such conditions are headlines for the 

too-familiar bleak African story. Yet ther

another story to be told. If one takes 

longer view, the independence period in s

Saharan Africa can be seen as a movem

from mostly single-party governm

backward to no-party military rule, and t

from military rule forward to more democ

ic rule and more open societies. Potenti

far-reaching positive changes have been 

curring in many African states in recent ye

Countries such as Benin, Botswana, C

Verde, Malawi, Mali, Mauritius, Nami

Uganda, Ghana, Kenya, Tanzania, 

Swaziland have been cultivating more dem

cratic, market-based institutions

Reformist leaders in these states are emp

sizing the criticality of high standards 

governance, and they are plainly dedicated 

the serious improvements in the quality of 

162 Many African states fall near the bottom of global “cor

tion” rankings. See, for example, the “1998 Corruptio

Perception Index” prepared by Transparency Internati

and Goettingen University’s Internet Center for Corru

Research.

163 Current HIV/AIDS cases in sub-Saharan Africa are esti

ed at about 14 million, fully two thirds of the world

estimated total of 21.8 million. See UNAIDS Program

data, World Almanac, 1998, p. 840. As to refugees, 35

percent of the people of greatest concern to the UN H

Commission of Refugees (UNHCR) globally are in su

Saharan Africa, the largest regional percentage by far.

UNHCR, The State of the World’s Refugees: A

Humanitarian Agenda (Oxford: Oxford University Pre

1997), p. 3.

164 Susan Rice, “Bram Fischer Memorial Lecture,” Rhodes

Scholars’ Southern Africa Forum, May 13, 1999.

165 See Freedom in the World 1997-1998 (New York: Freed

House, 1998), pp. 600-1; and the 1999 Index of Econo

Freedom (Washington, DC: Heritage Foundation, 199
U.S. Commission on National Security/21st Century 

96 NEW WORLD COMING

for their countrymen. They are also often

asking for the best international advice in

building transparent, rule-of-law-based systems

of governance. As a result, these economies are

attracting important outside investments166 and

have been growing at very respectable rates, in

several cases 7 percent or more a year.167 In

light of these accomplishments, some observers

now herald an African renaissance. 

There is still more good news. Literacy

rates are growing throughout the continent and

the communications revolution is underway.

While urbanization strains the capacity of government to deliver services, it can also be a

crucial element in the building of national

identity. When people leave their regions, they

leave the pull of clan and tribal authority

behind as well. While tribal groups tend to live

in certain districts of cities, in time they tend to

mix together far more thoroughly than is

possible in rural areas. In some parts of Africa,

too—most notably the Sahel—urbanization introduces people to new consumption patte

for food, clothing, and other goods. The re

has been to stimulate demand, and that 

aided economic growth in several count

over the past decade. 

Beyond the successes of several small 

medium sized countries, there are also encour

ing developments in two sub-Saharan giant

South Africa and Nigeria.168 South Africa is 

166 During 1990-94 the average annual return on book valu

U.S. direct investment was nearly 28 percent, about th

times the rate of worldwide return in that period. See

Department of State, “U.S. Trade and Investment in S

Saharan Africa,” December 1997.

167 For example, 1998 GDP growth for Mauritius was over 

percent, Botswana’s was about 7 percent, and Ghana’s

about 6 percent. IMF, World Economic Outlook, Octob

1998, p. 188.

168 The approximate populations of these two states in 199

were: Nigeria (113 million), South Africa (43 million)

Democratic Republic of Congo (50 million) and Ethio

(59 million) are the other very populous non-Arab sta

on the continent.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

far the economically dominant state in the

region.169 Nonetheless, it is experiencing significant problems: very high unemployment

rates, the highest (and still rising) crime rate in

the world, and a majority of the population still

in poverty. Moreover, the post-apartheid period

is only six years old, and those six years were

spent under the remarkable influence of Nelson

Mandela. It is therefore too soon to make definitive judgments about the future. But there

are also positive events and trends. South

Africa is making the transition to a multi-racial

democracy. A peaceful, second democratic

presidential election took place in June 1999.

Developments in South Africa have also aided

the settlement of the civil war in Mozambique.

For the first time in many years, too,

Nigeria—a country with more than three times

the population of South Africa although a GDP

only one-third as large—has at least a credible

chance to move away from an era of pervasive

corruption, human rights abuse, and economic

mismanagement. Important positive developments are in the works. The newly elected

president, Olusegun Obasanjo, has committed

himself to breaking Nigeria’s crippling cycle of

corruption, to introducing fair governance practices, and to reviving the economy. His

ambitious agenda includes designing and sustaining an effective federal system, balancing

the interests of diverse regions with that of the

central government; bringing the military under

civilian control; establishing an independent judiciary; and ensuring a continued pattern of

open and fair elections. He will need help from

the international community, and current indications suggest that he is ready to accept it.

Nigeria’s oil resources are a huge potential aid,

as is the cooperation of the companies that are

involved in the exploitation of that oil.170 If

Nigeria can get on track, and has the help and

good fortune to remain on track, in 25 years it

would become the economic engine of W

Africa, and a benign security presence for 

region as well.

I

n short, things may well come toget

Political and economic shifts of 

kind—toward democratic, market-based in

tutions—could potentially transform large p

of Africa over the next 25 years, providing 

basis for effective integration into the glo

economy. The small and medium sized c

states, which have already achieved a degre

democracy and made progress against corr

tion, can serve both as magnets for m

foreign investment in Africa and as role mod

of successful governance and econo

policies for other regional states. If So

Africa continues to make strong economic 

political progress, and if Nigeria can move 

cisively toward a more open, democr

system and a vigorous economic revival, t

the prospects for this region could brighten 

nificantly. 

Crafting institutions of governance that 

viewed with confidence by Africans will b

complex task. Harnessing the capabilities 

this region for effective democratic instituti

and free market development will depend ov

whelmingly on the leadership abilities 

African statesmen, civil servants, businessm

and scholars. Strong leaders could construct 

fective coalitions both within the states 

with other governments and internatio

agencies. Regional role models of integrity 

commitment to good governance, with ef

169 South Africa’s 1998 GDP was $306.5 billion (in Purcha

Power Parity terms), about one-third of Sub-Saharan

Africa’s total (of $903 billion). The sub-Saharan Afric

country with the next largest GDP in 1998 was Nigeri

with $112 billion

170 A short but interesting feature on Chevron’s relationshi

with Nigeria is Norimitsu Onishi, “Deep in the Repub

of Chevron,” New York Times Magazine, July 4, 1999.
U.S. Commission on National Security/21st Century 

98 NEW WORLD COMING

tive civilian control over the military, could be

shared throughout the continent, and built

upon. 

One means of achieving effective information sharing is through regional and sub-regional

organizations. Such groupings, particularly

those with a small number of similar states in the

same sub-region, provide some of the best opportunities for furthering and supporting

democratic and economically liberal policies. At

present, these groupings are very fragile.

However, if they are reinforced by bold African

leadership and by proper incentives from abroad,

then the region could potentially develop into a

markedly more important and constructive

player in the global economy. 

For the region as a whole, 4 percent real

growth per year through 2010, and potentially 5

to 6 percent real growth per year from then

through 2025 is plausible.171 To achieve this,

African statesmen and businessmen must work

hard to attract and nurture partnerships with

private investors—to take full advantage of what

the global economy has to offer. If they can, then

they will also have a real chance to stanch and

even reverse the current “brain drain” of

talented, educated Africans that has so seriously

crippled states such as Nigeria over the last few

decades. If South Africa and Nigeria make

strong, steady progress in governance, stability,

infrastructure development, and economic

reform, then aggregate growth rates in the 7-8

percent annual range may be possible for the

region. Sub-regional or even regional common

markets can certainly help significantly here;

they can help exploit economies of scale and

provide the advantage of what amounts to a

common currency.

Significant improvements in Africa’s standards of living, infrastructure, education, and

health between now and 2025 will clearly be

much harder to achieve, given the increase 

the number of children there will be to nurt

Africa’s population is projected to nea

double by 2025—from 620 million people 

about 1.1 billion—even despite the AI

epidemic that is sweeping through much of 

continent. In that case, Africa would be alm

as populous as China today. Sensible fam

planning, and far-reaching educatio

programs to facilitate such planning, t

appear to be indispensable elements in 

strongly positive evolution for Africa over 

next quarter century. It is not clear that s

programs will be forthcoming, but the adv

of good government throughout the region r

ically improves the chances that they will 

undertaken.

For a positive future, too, the epidemics 

now plague Africa need to be brought un

better control. Unfortunately, AIDS, as well 

variety of other major diseases, are likely 

remain major problems even in the best case 

the region.172 Of the 34 countries currently m

plagued by AIDS, 29 are in sub-Saha

Africa.173 Making significant headway w

require that children as well as adults be trea

on a massive scale. Strong help from inter

tional health organizations, both governme

and private, will be essential. 

Central to this positive evolution will 

be stemming the conflict and instab

that has wracked so much of the region for 

long. This instability has come in a variety 

forms: intra-state crises as in Rwanda; s

failures in such West African states as Si

171 See IMF, Global Economic Prospects, October 1998, p

189.

172 For details, see the United Nations population figures f

1998.

173 Noted in “The Demographic Impact of HIV/AIDS,” Un

Nations Population Division, 1998.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

Leone and Liberia; and protracted civil wars, as

in Sudan. Taken together, such conflicts have displaced upwards of 4 million people.174 All of

these types of conflict may well continue through

the first part of the 21st century. Together with

rising domestic crime in many states and the increasing prevalence of transnational problems

such as narcotics and money laundering, they

clearly pose serious security challenges to all

African states. Indeed, the general problem of

corruption—at the top as well as elsewhere in

society—may be the region’s most serious

problem. 

Progress in addressing fundamental political and social problems can help resolve the

root causes of many conflicts in the region.

Here, too, there have also been a number of encouraging conflict resolution initiatives—both

from within the region as well as by other concerned parties—that will need to be reinforced

for this positive evolution to have any real

chance. Several African inter-governmental organizations have expanded their traditional

political and economic foci to include secu

concerns. The OAU’s Conflict Resolut

Center, the Southern African Developm

Community’s Political, Defense and Secu

Organization, and the Economic Communit

West African States’ operation in Liberia h

promise for promoting African solutions 

regional conflicts and security concerns. Fu

efforts can advance intra-regional coopera

while seeking to spread positive politi

economic gains throughout sub-regional are

At the same time, Africa will need to 

engaged with states outside the region to t

full advantage of global opportunities for de

opment and security—through bilat

relationships and constructive partnerships in 

ternational organizations. The United States 

established programs such as the African Cr

Response Initiative and the new African Ce

for Security Studies. Such relationships 

174 UNHCR, The State of the World’s Refugees: A

Humanitarian Agenda (New York: Oxford University

Press, 1997), pp. 286-7.

Source: UNAIDS, AIDS Epidemic Update, December 1998.

AIDS Deaths and HIV Infections

Total Cases to Date
U.S. Commission on National Security/21st Century 

100 NEW WORLD COMING

provide a basis for strengthening trends toward

democracy and economic liberalization, while

providing additional forums in which to seek

conflict resolution. 

The overall challenges for Africa areclearly daunting. Looking out to 2025,

a number of pessimistic futures are not difficult

to envision. Things might not come together,

but fly further apart.

One or more of the populous states in the

region, especially Nigeria or South Africa, but

also Kenya or Tanzania, may fail to make

economic and political progress. The all too

frequent conflicts in the region may persist or

intensify. HIV/AIDS may not be brought under

control. Soaring population growth rates may

continue despite the ravages of disease.

Emerging patterns of democratic governa

may not survive. At worst, some of these st

could become havens for organized crimin

and political/religious extremist groups in p

session of increasingly lethal weapons.

African economic growth, moreover, 

have a difficult time keeping pace with 

region’s rapidly growing population. Econo

growth at levels around 6 to 7 percent 

annum will be necessary in many countries 

to keep up with population growth. Thus, so

of the robust figures on African econo

growth in recent years are deceptive. Gr

economic activity always increases with po

lation, but it is per capita figures that ma

most, and in this regard Africa’s progress is 

less impressive.

Areas of Conflict
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

Such adverse outcomes would, of course,

represent an enormous waste of Africa’s

human and natural resources. If significant

headway cannot be made on many of these

fronts, the United States and the rest of the

world could face terrorist threats, refugee

problems, an increase in organized crime, and

health epidemics spilling out of the sub-continent to climes far and wide. 

Perhaps the central problem that may

arise in and from sub-Saharan Africa

is the splitting asunder of state frontiers.

Social pressures, bad government, and the

spread of various transnational dangers could

fracture many of the territorial states that

have been basically stable since the independence period. The war in and over the

Democratic Republic of the Congo may represent a major watershed for the worse in this

respect. In no regional fracas before the

collapse of Mobutu’s Zaire has there been so

much serious and varied military intervention

by African states into the internal affairs of

another. The interests of Zimbabwe, Uganda,

Angola, and other states are so sharply at

variance, and the Congo’s ethnic diversity

and geographical swath are such challenges

to state-building, that the Congo may never

come back together as a single political unit

in the shape it held in 1995. 

The ongoing war between Ethiopia and

Eritrea is another cautionary example.

Eritrean independence was achieved in

unison with the Ethiopian government that

overthrew the heinous regime of Mengistu

Haile Mariam. But even though Ethiopia’s

borders were changed by consent, and even

though the two leaderships professed friendship and peace toward each other, it was not

very long before the two countries fell into a

ruinous border war. 

Events in the Democratic Republic 

Congo and Ethiopia have violated the ta

against the violent changing of frontiers 

Africa. This could lead to more confl

Among those most vulnerable to ethnic c

flagration and territorial reconfiguration 

some major ones, including Kenya, Ugan

Senegal, Angola, Tanzania, South Africa, 

Sudan—the last of which has suffered fr

more than 20 years of a civil war that 

shows little sign of ending.

It is also possible that the examples of 

Democratic Republic of Congo and Ethio

will strengthen the will of African elites 

maintain the territorial status quo, having n

seen the costs of change. But if that does 

happen, the weakening of respect for 

existing territorial state system in s

Saharan Africa could trigger civil wars in 

many as half a dozen African states. S

strife could easily spill across borders 

various ethnic groups seek to unite the

selves under a single flag. Once the fight

stopped, such a reconfiguration of states i

more homogeneous ethnic units could m

subsequent attempts at nation-building m

ginally easier. But the long-te

consequences could be disastrous, for el

that can more easily build nations on the b

of ethnic solidarity can also more easily t

them to war against alien groups.

The humanitarian fallout from such w

would be dramatic, easily overwhelming 

existing capacities of non-governmental or

nizations to manage them. As a world lea

the problem would doubtless queue up to 

U.S. foreign policy agenda and, given 

nature of American society and contempor

electronic media culture, the U.S. governm

would have to take up that agenda at leas

some extent. This would be so even if 
U.S. Commission on National Security/21st Century 

102 NEW WORLD COMING

concrete national interest, narrowly construed, were at risk.

Another real possibility, probably more

likely than the collapse of the territorial status

quo, is that the information revolution in

Africa will make borders increasingly meaningless. State capacities are modest in this

region, and they are unlikely to keep up with

new patterns of licit and illicit commerce. The

advent of mass communications in Africa will

hasten the expansion of business competence

far faster than the expansion of government

competence. Thus, Africa is likely to be a

prime example of states losing control over the

levers of economic life, and having their legitimacy and longevity called into question as a

consequence.

I

t is not at all clear whether sub-Saharan

Africa’s future will turn out to be bright

or tenebrous. It could well be mixed, with

some states achieving their goals of peace,

prosperity, and cultural renaissance, while

others descend into the pit of bad government

and social decay. In any event, as is usually the

case, the future is up to the peoples of the

region, and their leaderships. In a world where

regions no longer have automatic strategic significance on account of the global competition

among great powers, outsiders will not make

or break Africa’s future. Nevertheless, the potential for cooperation is great because African

states may need and warrant outside assistance, and because the Western countries

could, and should, see such assistance as selfinterested as well as charitable. An Africa in

chaos is in no one’s best interest.

The Americas

The Americas—defined here as Latin

America, Canada, and the Caribbean—is a

region of unique importance to the United

States. The region is home to the two larg

U.S. trading partners—Canada and Mexic

and the destination of over 40 percent of 

U.S. exports. The United States imports natu

resources from the region, including petrole

from Mexico, Venezuela, and Trinid

Additionally, cultural ties between the Un

States and Latin America are strong; the Un

States has the fifth-largest Spanish-speak

population in the world, now some 17.3 mil

strong.175 At the same time, the geograph

propinquity of Canada, the Caribbean, Mex

and Central America to the United States o

makes the problems of one country a dome

concern for others—the United States includ

Latin America, the Caribbean, and Can

are very distinct from each other. L

America’s cultural and political roots w

molded by their Spanish and Portuguese co

nizers. The mix of indigenous tribes w

Europeans created the social base that exist

Latin America today, but the mixing is dif

ent in different countries. Less than 

percent of Costa Rica’s population is made 

of indigenous people, for example, but indi

nous groups constitute 44 percent of 

population of Guatemala, and substantial p

centages also in Mexico, Peru, Bolivia, 

Ecuador.176

In contrast, the Caribbean islands tr

their roots primarily to English, French, 

Dutch colonizers, and also to the institution 

slavery as practiced by Europeans from 

17th through the early 19th centur

Parliamentary systems are the norm in 

Caribbean and, unlike Latin America, 

175 The number of Hispanics in the United States is even

larger—22 million—but not all Hispanics, a catchall t

meaning those whose forebears came from Spanishspeaking countries, speak Spanish.

176 CIA World Factbook, 1998.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

primary language is English. Canada also has

a parliamentary system based on British traditions.

I

n the last 20 years, Latin America has

undergone profound transformations.

All of the 35 countries in the region have democratically elected governments, with the

exception of Cuba. Free market economics

has replaced protectionism in most count

as the chosen path for long-term econo

growth, a major shift in attitude from 

decades ago. Steps have been taken tow

economic integration, most notably thro

the Southern Cone Common Market 

Mercosur, whose members are Bra

Argentina, Paraguay, and Uruguay. This 

earned the region much respect from 
U.S. Commission on National Security/21st Century 

104 NEW WORLD COMING

vestors worldwide; some $40 billion per year,

on average, entered the area in the 1990s.177

Human rights abuses in the region have been

significantly curtailed, and several insurgencies in Central America have been ended by

negotiation. Armies have for the most part

stayed in their barracks, another shift in historical patterns. In short, Latin America has

gone far in transforming itself from an area

dominated by authoritarian regimes with

closed economic policies into a model of progressive political and economic development. 

Despite these positive trends, many Latin

Americans have yet to see the fruits of change.

Income disparities in the region are the greatest

of anywhere in the world. A quarter of all

national income is in the hands of 5 percent of the

population, and the top 10 percent absorb 40

percent of the wealth.178 The poorest 30 percent

of the population receive only 7.5 percent of

national income, and only a small middle class

exists in most countries.179 Social conflict

between native populations and those of

European origin is endemic in many countries,

including Bolivia, Colombia, Ecuador,

Nicaragua, Mexico, Peru, Guatemala, Honduras,

and Brazil. 

Meanwhile, violence and crime are pervasive. The region also suffers from high levels of

governmental corruption and graft. With

economic growth uneven in most countries, the

possibility of economically failed states—states

that cannot reliably provide rudimentary

services and that default on their international

obligations—cannot be ruled out over the next

25 years. 

Perhaps most important, Latin American

democratization is still fragile, except in Chile,

Costa Rica, and Uruguay. The rule of law,

respect for basic civil liberties, the existence of

mass-based political parties, the de-politicization of military institutions, and the rights 

free speech and organization are still ten

shoots in many of the area’s formal demo

cies. A sign of this fragility is the difficulty 

free media have had conducting objective po

ical polling in many countries.180 The citize

in many Latin American countries have 

become fully comfortable with the attitudes, 

“habits of the heart,” that ultimately undergi

democratic polity.

Notwithstanding this mixed situation, 

Americas will be an increasingly impor

region for the United States over the next 

decades. U.S. trade and investment will incre

Latin America and the Caribbean are projecte

have over 690 million people by 2025, roug

twice the size of the European Union. An OE

study projects growth rates for Brazil’s econo

as high as 5.6 percent over the next 20 years

Should this projection prove accurate, Brazil 

emerge as a major global economic power, w

a GDP roughly equivalent to Japan’s today

addition, U.S. cultural ties with Latin Ame

will grow stronger in the coming decades

2025, the Hispanic population in the Un

States will be the largest minority group in 

country.

What, then, will the future hold for 

Americas, and how will that future affect 

United States? Four factors will be m

critical: how the economies of the ma

177 Figure cited in Abraham Lowenthal, “Latin America in 

Time of Global Financial Turmoil,” March 1999 (unpu

lished draft).

178 Inter-American Development Bank Report, Economic a

Social Progress in Latin America: Facing Up to Inequ

in Latin America (Washington, DC: 1998), p. 1.

179 Ibid.

180 See here Humphrey Taylor, “Pollution,” The National

Interest, No. 51 (Spring 1998).

181 Projections based on data in OECD, The World in 2020
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

players fare in the context of the new global

economy; whether liberal democratic and free

market principles prevail; how Mexico and

Brazil evolve politically; and what role the

United States plays. We take these in turn,

looking at both optimistic and pessimistic possibilities. 

Recent trends suggest that Latin

America will enter the 21st century

from a positive economic base. Reforms initiated as a result of the region-wide debt crisis of

the 1980s have resulted in greater fiscal and

monetary discipline, lower inflation, a compressed public sector, and diminished barriers

to international and regional trade. If the

region can sustain annual growth rates of 6

percent, as some observers have projected, its

countries will be better able to address widespread poverty, poor educational and health

systems, and other problematic social conditions. 

Latin America has a demographic

“window of opportunity” with which to attain

these goals. Fertility rates are dropping and

population growth rates are decreasing.

Between 1995 and 2025, average annual population growth rates are projected to fall from

1.73 percent to 1.07 percent in Mexico, from

1.33 percent to 0.76 percent in Brazil, and

from 2.71 percent to 1.41 percent in

Honduras.182 As a result, the number of

working age people will rise in proportion to

the number of children. A shrinking youth

bulge, a larger work force, and a yet-to-have

aged population suggest a smaller financial

burden on state resources and the chance to accumulate domestic capital needed to finance

education and other social projects.

The prospects for expanding free trade are

also good, particularly given the importance of

international commerce in the region.183 Trade

accounts for over 40 percent of Mexico’s G

and over 50 percent of Chile’s.184 Both 

Central American Common Market (CAC

and the Caribbean Common Mar

(CARICOM) have shown interest in streng

ening their ties with NAFTA, which could l

to their accession to the trade pact. The Un

States, Latin America, the Caribbean, 

Canada have already agreed on a concept o

Free Trade Area of the Americas. Merco

will probably add new members over the n

25 years.185

Hemispheric free trade is also progress

on a bilateral basis. Chile has free trade agr

ments with nearly every country in 

Americas, including Canada. Mexico has ne

tiated a number of free trade agreements 

addition to NAFTA, including ones with Co

Rica, Chile, Venezuela, and Brazil. 

Since successful trade associations h

often been associated with positive polit

outcomes, an Americas region tied together 

free trade might also cooperate effectively 

dealing with other transnational issues such 

drugs, crime, and the environment. A

regional economic interdependence mi

lessen the possibility of interstate conf

although history is replete with cases wh

this has not happened.

182 The World Bank, World Development Indicators 1998.

183 Knight Kiplinger, World Boom Ahead: Why Business a

Consumers Will Prosper (Washington, DC: Kiplinger

Books, 1998), pp. 94-8.

184 1996 figures. Trade accounts for 75 percent of Canada’

GNP.

185 The other regional associations are the Andean Group

(Bolivia, Colombia, Ecuador, Peru, and Venezuela) an

Central American Common Market (Guatemala,

Honduras, Nicaragua, El Salvador, Panama, and Costa

Rica.
U.S. Commission on National Security/21st Century 

106 NEW WORLD COMING

In addition to trade integration, the

Americas will experience greater monetary integration. Proposals for dollarization are being

debated by the public and/or private sectors in

Argentina, Mexico, and El Salvador. Currently,

Latin Americans hold a majority of their

savings in dollars, and 70 percent of banking

assets and liabilities are dollar-denominated in

Argentina, Bolivia, Peru, and Uruguay.186

While dollarization is likely to be hotly debated

both domestically and abroad, global trends

indicate that a regional currency bloc is a strong

possibility by 2025. If a currency bloc in Latin

America does emerge, it could prove to be a

strong source of economic stability and help

further unify the region. 

Hurdles to the region’s positive

economic future should not be underestimated, however. The most important is the

prospect that globalization will widen social divisions and abet economic polarization.

Existing class divisions in most Latin American

countries could be increased. The rich and well

placed would be in a position to acquire the

knowledge-based skills, the technological

devices, and the international contacts that

would propel them into the world of cyber-prosperity. Meanwhile, the majority of the

population would remain in the barrios, getting

poorer and more distant from the opportunities

of the early 21st century. This is a formula for

social and political upheaval, and hence, ultimately, for economic instability as well.

Even more daunting, sharp income differentiation divides many Latin American states

along cultural lines. Many of the rural poor in

Latin America are members of indigenous

groups who remain largely outside the political

spectrum and represent a large portion of the

population in countries such as Bolivia, Peru,

Mexico, Guatemala, and Ecuador. Whether

these groups are incorporated into the political

and economic mainstream will help determ

if stability or conflict characterize these s

eties in the future.

On a different level, many countries in 

region depend heavily on commodity expo

and in some cases on only a single commod

The volatility of the commodity market lea

these economies vulnerable to the whims of 

global economic environment. Moreover, m

countries lack the resources necessary to m

beyond a commodity-based economy and 

unlikely to develop them over the next 25 ye

Second, the region suffers from a scar

of capital and is likely to remain significa

dependent on external sources of capital o

the next 25 years. This dependency is aggra

ed by the fact that the bond rating agencies 

not give most states in the region high ma

The more positive climate for business tha

developing in Argentina, Uruguay, Boli

Peru, Ecuador, Panama, El Salvador, Co

Rica, and Chile has improved their econo

freedom rankings over the last five ye

Higher bond ratings may well follow

Nevertheless, while sound fiscal policy is p

ducing somewhat higher rates of dome

savings, these rates are not likely to incre

significantly. Moreover, any increases 

income will tend to go toward relieving 

burdens of protracted sacrifice rather than 

capital savings. 

Third, most Latin American countries 

saddled with inefficient tax structures and h

rates of tax evasion. Therefore, the regio

economic future will partly be determined 

its success in broadening the tax base and 

proving collection. 

186 David Ignatius, “Dollarization in Latin America,”

Washington Post, April 28, 1999, p. A25.

187 Kiplinger, World Boom Ahead, p. 95.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

Finally, in order for national and intraregional trade in Latin America to flourish, the

region will need to develop a more effective

transportation infrastructure. Good roads are in

short supply; many of them are so rough that

large trucks and automobiles cannot drive on

them during the long rainy season. There are

few trains connecting interstate trade centers

and, as a result, Latin American producers

often have difficulty getting their goods to

market. New projects take time and cost much

money, and even the seemingly successful

ones, such as the Hidrovia waterway involving

mainly Argentina, Uruguay, and Brazil, churn

up opposition and many opportunities for graft.

It is also the case that, as with other parts of the

Latin American economy, infrastructure investment relies heavily on foreign money. 

The next 25 years will determine

whether Latin America’s march toward

democracy is successful or not, and the consolidation of democracy is probably the most

important overall determinant of the region’s

prospects for security and stability. The relationship between democratic governance and

economic growth is complex. In the case of

Latin America, its prosperity may well be connected to the capacity of its countries to open

themselves to the world economy. That is

because international best practices tend to

reward accountability, transparency, and consistency—all hallmarks of democratic rather

than authoritarian governance. 

One important sign that Latin American

democracy may prosper in the years ahead has

been the transformation of military institutions.

Many military leaders in Latin America have

donned civilian clothes and turned to electoral

politics in order to wield legitimate power,

which is a long way from the strongman

(caudillo) style of the past. The military itself

has shunned intervention over the last decade

and has typically left matters under civi

control. They have accepted post-transit

defense reforms and budget cuts. They h

adopted new roles, including participation 

peacekeeping operations. The border betw

Ecuador and Peru, for example, is monito

by a multilateral peacekeeping force t

includes soldiers from Argentina, Brazil, 

Chile. In short, most Latin American mili

leaders have come to understand the imp

tance of maintaining a democracy in order 

their country to be an accepted and respec

member of the international community. 

The democratization process has also b

effective in reducing conflict in the region

has facilitated the peace process in Cen

America by enabling former guerrillas in 

Salvador, Nicaragua, and Guatemala to 

politics as a means to voice their conce

Gross human rights abuses committed un

closed, authoritarian regimes have been sig

icantly reduced as democratically elec

governments have chosen dialogue with op

sition groups over repression. Aside from 

limited war between Ecuador and Peru, 

continent has been at peace ever since its 

mocratic turn accelerated in the 1980s.

Latin American militaries will not likely 

called upon to save their countries from agg

sive neighbors in the future. On balance, m

interstate conflicts are unlikely over the nex

years. Border problems may still lead to tens

and even small skirmishes, as we have seen 

the recent past between Ecuador and Peru. 

the chances for such conflicts are dwindl

symbolized by the fact that Argentina and C

finally managed in the spring of 1999 to 

marcate their border to mutual agreement a

more than a century of dispute. For the m

part, too, any such border problems will no

traditional conflicts over territory as such, 
U.S. Commission on National Security/21st Century 

108 NEW WORLD COMING

rather over water rights, pollution, and migration issues. 

As a result, the major security threats to

regional states will generally not be from their

neighbors, but rather from domestic insurgencies, drug trafficking, organized crime, and

natural environmental disasters such as hurricanes and earthquakes. These natural disasters,

of course, are exacerbated by human foibles:

deforestation and excessive building in floodprone areas. But except for natural disasters,

progress on the economic front and strong democratic institutions will be more important for

addressing these challenges than military

forces. 

Defense budgets will probably continue to

fall in real terms and as a percentage of GNP.188

In some cases, these budget trends will make

significant military modernization impossible.

Weapons of mass destruction programs are also

very unlikely to commence. In the 1980s and

early 1990s, Brazil and Argentina eliminated

their nuclear programs and no other state

(except for Cuba) is even suspected of wanting

to develop weapons of mass destruction of any

kind. 

Unfortunately, not all signs are positive

for the development of democracy. If

Latin American engagement in the global

economy widens inequalities, democracy could

fall before the deepening of oligopoly as vested

elites try to protect themselves from change. Or

democracy could fall before a potentially

violent populism that would reverse market

reforms, and whose own respect for democratic norms is shallow.

Venezuela may provide a test case. The

current president, elected as a populist in

December 1998, promised to widen the

country’s political system to include those

beyond the tight, if formally democratic, e

that has run the country since 1960. But 

own democratic credentials are unclear, and 

sympathy for protectionist economic policie

well known. It is still unclear whether he 

trying to consolidate power in order to bring 

fruits of democracy to all of Venezue

people, or to re-establish authoritarian r

under his own fist. 

Perhaps the most vexing challenge to 

development of Latin American democracy

well as society as a whole, is the prolifera

of crime, corruption, and illegal drug traff

ing. In countries such as Colombia and Mex

organized crime groups have penetrated 

upper echelons of government. Corruption 

Latin America stems mainly from the prac

of clientilism, an historic patron-client relati

ship where some members of the elite ob

public office by trading promises of patron

and largesse. Consequently, some state offic

often accept bribes or promotions as comm

to doing business, a practice that tends to m

allocate resources and to undermine 

legitimacy of state institutions. Latin Ameri

drug cartels have turned drug trafficking in

profitable and highly developed indus

netting them hundreds of millions of dolla

year. While Latin American politicians 

knowledge the gravity of these problems, m

Latin Americans view their governments as 

athetic and ineffective in combating th

threats. The result in the future could be so

unrest, a greater centralization of governm

control, and even calls for strong president

rule by decree.

188 See Stockholm International Peace Research Institute,

SIPRI Yearbook 1998:Armaments, Disarmament and

International Security (Oxford: Oxford University Pre

1998), p. 214.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

The United States has an interest in

Latin America as a whole, but two

countries are especially critical: Brazil, because

it is so large, and Mexico, because it is so close. 

Brazil is responsible for approximately 40

percent of Latin America’s total GDP. A deep

and prolonged economic recession in Brazil

would have serious effects on the regional

economy, especially for its Mercosur trading

partners. Even in the more positive future,

several factors may obstruct Brazil’s achieving

the economic success many have predicted for

it: deeply entrenched vested interests within

state and federal levels of government that

complicate economic policymaking; the potential for monetary instability; dependence on

external capital; and the worst distribution of

income of any nation in the world. 

While Brazil has moved to correct these

problems and is likely to make much progress

over the next 25 years, investor confidence

could still plummet, sending Brazil’s economy

spiraling downward as foreign and domestic investors shift to lower-risk environments. First,

doubts persist about the viability of Brazil’s

banking system. Second, the Brazilian

economy could stumble if the privatization of

state-owned enterprises either falters or fails to

increase industrial efficiency and global competitiveness. Third, poor exchange rate policy

could result in an overvalued real. Lastly, the

richest one percent of Brazilians control nearly

half the land; land reform is critical, but it is by

no means clear that it will occur.189

Furthermore, Brazil’s economic stability is

dependent on market perceptions, given its

high level of dependence on external capital to

finance its current account deficit.190 If investors lose confidence in the Brazilian

economy, it could provoke a serious economic

crisis. Excessive capital flight could force

Brazil to devalue the real and raise inte

rates. Credit could then dry up, limiting inv

ment and forcing the economy into a recess

Steep interest rates would increase the num

of non-performing loans and could push 

banking sector to collapse. The hardest 

would be the poor and the middle class, 

stroying the ability of the latter to generate 

domestic savings necessary to reduce Braz

dependence on foreign capital. A sev

economic downturn in Brazil is a real possi

ity, well within 25 years. 

Extended negative GDP growth in L

America’s largest economy also would h

region-wide repercussions. Lack of inve

confidence in Brazil would likely result in 

investment for all Latin American countrie

domestic and foreign investment seeks s

havens. This could result in a region-wide 

cession, which in turn could affect Ameri

commercial ventures in Latin America 

reduce U.S. exports to the region. 

In sum, Brazil’s economic well-be

remains a key question mark over L

America’s future, and would affect U

economic well-being, too. If the country is a

to perform to its potential, it can help drive 

region toward a more prosperous future. If 

Brazilian economy falters, the entire reg

will suffer the consequences. 

Mexico has made many economic 

political strides over the past 

decades. It has replaced its import substitu

industrialization strategy with free mar

oriented policies, culminating with its acc

sion to NAFTA in 1994. Additionally, 

189 Allen Hammon, Which World? Scenarios for the 21st

Century (Washington, DC: Island Press, 1998), p. 131

190 According to World Bank figures, Brazil’s current acco

deficit in 1996 was $24.3 billion before official capita

transfers.
U.S. Commission on National Security/21st Century 

110 NEW WORLD COMING

political system has gradually liberalized,

becoming more pluralistic and competitive.

Both of these developments have made

Mexico’s economy more robust, as demonstrated by its successful weathering of the recent

Asian and Russian financial crises. 

Nevertheless, Mexico remains vulnerable

on several fronts. The economy is not solid. It

will take years to develop a well-regulated

banking sector, as a result of the careless

lending that preceded the 1995 debt crisis. Like

Brazil, Mexico’s financial well-being is also

highly dependent on external capital.

Furthermore, its fiscal stability is overly dependent on the world oil market. As a result, a

number of internal weaknesses and external

shocks could cause severe economic difficulty

for Mexico over the next 25 years. 

Mexico could also face acute political instability, either through an over-centralization

or a decentralization of power. For the past 70

years, power has been centralized within the

presidency under the control of the PRI

(Partido Revolucinario Institucional). In the

1990s, Mexico moved toward a multiparty

democracy, with opposition parties winning a

number of state governorships and control of

the lower house of the national legislature. But

the PRI has not relinquished the Presidency

since it took power in 1929. While some other

party might win a presidential election, the

ruling party is still strong and, faced with political defeat, it could execute an internal

coup—an autogolpe—to keep itself in power.

That may have already happened once: many

Mexicans believe that Carlos Salinas stole the

1988 presidential election from Cuauhtémoc

Cárdenas. 

If the PRI were to hijack a future national

election, the sizeable and well organized opposition that has developed in recent years could

mount widespread and effective protests. T

could seriously strain U.S.-Mexican polit

and economic relations. If the cycle of pro

and repression were to get out of hand, it co

send many more Mexicans across th

northern border than are liable to come anyw

On the other hand, and probably just 

likely if not more so, democratization co

continue on its current path, with more po

devolving from the executive to other fed

branches and the states. Given Mexico’s h

erogeneous character, such a devolution co

eventually result in the country’s break

State governors might take on greater respo

bilities for providing public services 

domestic security. While not very lik

Mexico might even split into northern 

southern parts. Today, the income generation 

the northern border states largely subsidizes 

poorer southern states. If the northern st

gained more control over their tax dollars, 

possible that they would be less interested 

shouldering the economic burden of th

southern brethren. 

Another closely related realm of po

tial instability is social in natu

Mexico has one of the highest measures 

income inequality in Latin America and 

already faced a number of uprisings in 

largely rural southern states of Chiap

Oaxaca, and Guerrero over poor standards 

living, lack of job opportunities, and gove

ment disinterest in the well-being of peasa

and indigenous peoples. Urban unrest is als

possibility as more people move to the ci

and frustrations mount because their rising 

pectations cannot be met. The combination 

restive rural and urban population that p

ceives the federal government as failing to m

its economic needs or provide sufficiently 

its personal security, could be a volatile mix
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

Clearly, the United States cares deeply

about acute instability to its immediate south.

Mexico is the second largest trading partner of

the United States, and economic chaos there

would depress American exports. Profits of the

numerous commercial ventures in Mexico

would shrink. Economic or political instability

in Mexico would increase pressures for more

migration to the United States and evoke

American resistance in many forms. Moreover,

lack of political control and economic hardship

would also encourage the drug trade to flourish,

along with other criminal enterprises, and

would certainly infest the U.S.-Mexican border

region with crime and violence. 

Political, economic, and social instability

in Mexico would arguably be the most serious

national security threat to the United States that

could emanate from Latin America. Given

Mexico’s size, such a debilitated environment

would be difficult to contain and could even

raise the specter of a U.S. military intervention in tandem with the Organization of

American States. But such an extreme con

gency is very unlikely over the next 25 yea

Finally the role of the United States w

be important to how this reg

develops in the future. Latin America will 

be a major strategic-military concern, but 

political and economic future of the region 

matter a great deal. The United States will c

as to whether free trade and democratic inst

tions survive. It will also wish to avoid 

major polarization between the northern 

southern parts of the hemisphere. 

There are several ways free trade could 

threatened. If global economic integrat

comes unstuck and a prolonged econo

meltdown occurs, Latin American lead

191 The number of crimes reported to the police grew 36

percent from 1994 to 1995 and 14 percent more in 19

but most crimes in Mexico go unreported. See “A Stai

Spreads Across Latin America,” Los Angeles Times, A

25, 1999.

U.S. Trade with NAFTA Increasing

Source: U.S. Census Bureau, U.S. Trade in Goods and Services - Annual Revision for 1991-1998, May 1999.

Note: NAFTA went into effect Jan. 1, 1994.
U.S. Commission on National Security/21st Century 

112 NEW WORLD COMING

might look inward for economic growth,

adopting protectionist economic policies to

shield their countries from external threats. A

protectionist regional policy could also emerge

as a result of growing popular resentment to

external prescriptions for the region’s ailing economies. Many of the IMF and World Bank

policies include politically unpopular measures

such as cutting subsidies and improving tax

collection practices. Or South American

leaders could become increasingly disenchanted with U.S. trade policy, and shift their trading

links to Europe. Currently, over 27 percent of

Mercosur’s exports go to Europe. Imports from

the European Union to Mercosur increased 104

percent between 1993 and 1996—32 percent

more than imports from the United States.192

There is also a broad political route to

trouble. Inward looking economic policies could

emerge as a result of weak economic performance over a prolonged period of time,

bolstering the notion that free market trade

policies hinder rather than promote income

equality and poverty reduction. At a popular level

this view could generate support for political candidates who adopt less globalist and more

protectionist platforms.193

Resentment against neoliberal policies

could be channeled through the political system

and outside of it. Radical political parties might

develop more support and polarize a political

landscape generally dominated by two elite

parties. These radical parties might also have

military arms much akin to IRA or the ETA,

which have committed terrorist attacks to

attract public attention. Popular anger toward

the state could also be channeled outside the

political spectrum through armed guerrilla

movements. Increasing financial and popular

support for new and existing guerrilla groups

could foment violent attacks against the state

and civilians alike. 

Such instability would create an opportu

ty for nationalist political leaders. S

aspirants will likely be populist, guarantee

tangible results, while also appealing to L

America’s traditional sense of personal polit

Even today, populism has shown a resurge

in Venezuela, where Hugo Chavez utilizes 

erendums, social promises, and a pac

constituent assembly to govern.

The election of a nationalist L

American president under such circumstan

could have an important economic side eff

Whether for domestic political reasons 

simply a desire to change economic directio

populist leaders might pursue protectio

economic policies to shield themselves fr

U.S. and world influence. That could sign

cantly reduce trade between Latin America 

the United States, Europe, and Japan.

Relations between the United States an

protectionist Latin American country (or s

region) could become particularly strain

Latin American leaders would reduce ties to 

United States and other developed countrie

placate domestic political opinion. The lack 

economic cooperation could also hamper co

eration on immigration, drugs, pollution, 

other transnational issues.

The most likely area where such nega

developments could occur is the And

region. Today the Andes is one of the m

economically depressed areas of So

192 Sam Laird, “Mercosur: Objectives and Achievements,”

World Trade Organization paper, May 23, 1997.

193 In brief, populism has led to economic failure in the pa

for Latin America mainly because the state did not ha

enough revenue to support service-driven political

policies. A single country could not implement these s

of policies if capital inflow dried up and loans were n

available. It is conceivable, however, that this capital c

come from the growing regional trade now taking plac
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

America. If poverty and social inequality

continue at the current pace, by 2025 the

Andean region could be wracked with violence,

corruption, and instability. In the last 40 years,

guerrilla movements have been prominent in

the region, including an insurgency in Bolivia

led by Che Guevara, and, more recently, the activities of the Sendero Luminoso and Tupac

Amaru in Peru.

Given the rough terrain and poorly guarded

frontiers in the region as a whole, there are few

constraints on guerrilla movement back and

forth across state borders. That raises the possibility of non-state actors re-aggravating

historical grievances and sparking a broader

regional conflict. The fact that armed guerrillas

in Colombia have already violated the border

with Panama and Venezuela illustrates the

problem. Additionally, it is possible for a

populist government, elected through democratic means, to evolve into an authoritarian

regime as a result of societal stresses and a

general loss of confidence in democracy. 

An uncooperative relationship between the

United States and Latin America could arise

not only from poor economic performance, but

also due to resentment stemming from U.S. political and economic policies in the region.

Leaders in Peru, Bolivia, Ecuador, Colombia,

or the Caribbean could become increasingly

frustrated with U.S. drug policies. Combined

with popular nationalist sentiment, this frustration could produce a widespread anti-American

attitude. Countries like Chile could also exude

an anti-American position due to its mounting

frustration with U.S. economic policies. A

powerful South American economic pact might

even put its principal members in a position to

demand political and economic concessions

from the United States, and to threaten to take

its business to the EU if Washington demurs.

Finally, a few words about the Caribb

and Canada.

The states of the Caribbean are, for 

most part, very different culturally from L

America. Except for Cuba and the Domini

Republic, Spanish is not the language of m

of its lands. Their economies are small, as is 

size of most countries’ land masses, and th

resources are generally scant—save for oi

Trinidad. Democracy is widespread but o

fragile, and population and social pressures 

many and growing. Also, the Caribbean 

unique in that a few of its islands are s

ruled as colonies of France, Great Brit

and the Netherlands.194

For the most part, this nearby area 

the world poses non-traditional secu

problems for the United States. One conce

illegal immigration and another the role of 

islands in the drug trade and money launder

If there is reason to worry about crimina

overwhelming relatively large states such 

Russia or Nigeria, there is even more reaso

worry about the Caribbean, where governm

capacities are small relative to the syndic

they sometimes face. There is even a ques

of fundamental viability for many of 

smaller island states in the region, and thi

reflected in the growing number of shipride

greements that have been negotiated with 

United States. Such agreements allow local 

ficials to board U.S. Navy or Coast Gu

vessels operating in their own territorial wa

against smugglers and thieves—to depu

194 Specifically, French possessions in the Western hemisp

are Martinique, Guadaloupe (and, much farther north, 

Pierre y Miquelon); the Dutch include Aruba and the

Dutch Antilles (Curaçao, Bonaire, Saba, St. Eustatius, 

part of St. Martin); and the British possessions are the

Falklands, Montserrat, the Cayman Islands, Anguilla,

Bermuda, the Turks and Caicos Island, and the British

Virgin Islands.
U.S. Commission on National Security/21st Century 

114 NEW WORLD COMING

them, so to speak.195 There are also gangs from

various islands residing in the United States

who are used by friends at home to smuggle

goods and launder money. 

Haiti is a special problem. Its condition is

poor in almost every regard, and that is despite

marked improvement since the end of the

Duvalier era. Political violence and related immigration pressures could recur at any time,

and the likelihood that they will sometime in

the next quarter century is high.

Cuba is a special problem, too, but in a different way. Haiti and Cuba have in common the

fact that their difficulties get translated into U.S.

domestic, not foreign, politics thanks to sizeable

émigré communities resident in the United

States. What happens in Cuba over the next 25

years will not have dramatic national security

implications for the United States. There will be

no foreign military bases on Cuban soil, no

fearsome Cuban weapons program, no export of

venomous anti-Americanism from a revived,

post-Fidel communist vanguard. But the

country is a political lightning rod, not just

because of pressures from the Cuban-American

community, but also because of Cuba’s emotional Cold War legacy. 

Various scenarios are possible. Raúl

Castro, Fidel’s brother and leader of Cuba’s

armed forces, is Castro’s heir apparent. He

would likely rule indirectly by selecting a

pliable civilian to run Cuba’s daily affairs,

while he maintained control over the the

country’s military and internal security forces

as well as the levers of economic power. Cuba’s

atavistic Communism would probably evolve

into some form of “institutionalized communism” without ideological pretense or energy. It

would become a one-party authoritarian state,

not unlike China and Vietnam, that would be

prepared to expand further its economic 

political ties with the international commun

But Raúl may not succeed Fidel, and in 

case, post-Castro Cuba could fall into a bi

power struggle between traditionalists and 

would-be reformers. Although the length and 

tensity of such a struggle is uncertain, it wo

engender short-term, and possibly longer-te

instability. Organized criminal groups could t

advantage of such instability to establish th

selves on the island, using Cuba as a base 

immigrant and narcotic smuggling to the Un

States. If the reformers were to come out on 

the prospects for democratic politics in C

would rise, even in a struggle fought ostens

over the proper path to socialism. But suc

struggle could lead to economic collapse, so

violence, and massive, panic-driven attempt

emigrate on the part of tens of thousands 

people. The Florida Straits would once ag

become a mixed scene of misery and heroi

and the United States could be forced once ag

to take action.

A third post-Castro Cuba envisions Cub

expatriate population in the United Sta

taking control of the island. But this would 

happen easily, and it is on balance unlikely. 

Cuban population of the United States that 

its eyes and heart set on ruling Cuba after F

came largely from the pre-Communist e

While most Cubans are less than thrilled w

Communism, they do not remember the Bat

dictatorship and those associated with it w

fondness either. They consider those who lef

be something less than fully patriotic, bat

scarred, and worthy of political power. To 

extent that the expatriot community appe

powerful in the context of a post-Castro Cu

195 See Elliott Abrams, “The Shiprider Solution: Policing t

Caribbean,” The National Interest, No. 43 (Spring 199
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

it may even convince various factions in Cuba

to avoid exploitable divisions. 

As for the rest of the region—the islands—

it is possible that state failure and colonial

fatigue in London, Amsterdam, and even Paris

will enjoin the United States to take a more

active security role in the region than it does

now. Even the U.S. acquisition of territory as

well as responsibility by mutual consent

cannot be ruled out. Since the Danish Virgin

Islands were sold to the United States in 1918,

the political status quo of the region has not

changed from a strictly U.S. perspective.

While not very likely, in the next 25 years it

just might.

The same might even be the case with

regard to Canada. It is alarming to

contemplate, but within 25 years the Canadian

confederation might collapse. It is not only the

issue of Quebec that might cause such a thing,

although it is the most likely catalyst.196

Despite different political traditions, the

western provinces of Canada are already more

closely attached, economically and even culturally, to their cousins in the western United

States than they are to Canada’s eastern

provinces. Vancouver is pulled in many ways

more toward Seattle, as well as to Tokyo and

Hong Kong, than it is toward Ottawa. 

Canada’s breakup, which even many

Canadians concede is possible, could send strong

shock waves through the United States. After all,

there is no society in the world more like our own

than Canada’s, and its dissolution may add

fissures to American solidarity. Already westerners of both countries speak about the “imperial

capitals” in Washington and Ottawa. While

unlikely, it is at least possible that British

Columbia, Alberta, and Saskatchewan might

become part of the United States within 25

years.197 Perhaps as likely, if not more so, the

poorer eastern maritime provinces of Canad

Nova Scotia, New Brunswick, and Pri

Edward Island—might seek such a course ou

a mix of desperation and self-interest. And un

some small Caribbean islands, which have 

significant natural resources, Canada has la

fossil fuel deposits, rich minerals, fisheries 

timber preserves, and, perhaps most valuable 

all, about 20 percent of the world’s fresh w

resources. Given the stakes involved for 

United States, it is a matter worthy of so

serious thought.

It is, of course, very unlikely that any U

government would seek such an outcome. I

a long way from 1812, and if the United St

has a best friend, and a partner in spirit as w

as basic interest, it is Canada. Canada is m

likely to cohere and to prosper, and becaus

does some things differently from the Un

States, it may serve as a most helpful mi

for us in many policy areas. The likelihood 

the United States and Canada would furt

coordinate foreign and security policy o

global humanitarian and environmental iss

of mutual interest is also very high.

197 Perhaps Manitoba, the Yukon, and the Northwest

Territories, too. The combined population of British

Columbia, Alberta, Saskatchewan, Manitoba, the Yuko

and the Northwest Territories is about 9.3 million.

196 Technically, this is already the case, for Quebec never

signed the 1982 constitution.
U.S. Commission on National Security/21st Century 

116 NEW WORLD COMING

III. The U.S. Domestic Future

The United States will likely remain the

most powerful country in the international arena over the next quarter century, and it will be

bound to the rest of the world through a web of political, cultural, technological, and economic ties.

Hence, the future U.S. domestic environment will

ineluctably influence the world around it, just as

events outside U.S. borders will affect the environment here.

America, then, will be in and of the world, but

which America? Who will we be? What will we

want as a nation, for ourselves and for others? Will

we have the means, the social cohesion, and the

requisite leadership to achieve our aims?

Analyzing the impact of future domestic conditions on U.S. national security is a formidable

undertaking. While some of the domestic determinants of national security are obvious—economic

capacity, for example—others are more subtle and

difficult to measure. A lack of social cohesion, for

example, would affect national morale and, ultimately, the economic performance of the country,

as well. Changes in deeper values and attitudes

could affect the willingness of Americans to sacrifice for national goals. As always, too, public

opinion will play a role, and here the evolution of

the American media culture in shaping that

opinion is obviously relevant. 

This latter issue, which amounts to forecasting

the popular will at any given moment some years

hence, is notoriously difficult to handle. While

values and attitudes change only slowly, public

opinion over particular issues or courses of action

can oscillate abruptly in response to unforeseen

events. If history and experience are any guide, it

surely will oscillate, because in the future no less

than in the past, American society will experience

any number of shocks and surprises. 

The sensible place to begin a forecast of 

American domestic future is by examining the 

mographic, social, technological, economic, 

political trends emerging today. What follow

such an examination, tempered by an awarenes

possible discontinuities. That examination 

followed, in turn, by a brief discussion highli

ing the key trends affecting U.S. national secu

Social Trends

Some aspects of social change are mpredictable than others, and the eleme

point of departure for examining social realit

thus usually the demographic one. This is beca

people form political communities, and t

numbers and nature are crucial to any fore

about those communities.

The central datum about the American po

lation is that it is expanding and will continu

grow over each of the next 25 years. This m

seem a banal statement, but it is not, for most o

advanced societies will experience stable or 

minishing populations during the same per

Today, the American population numbers ab

273 million; by 2025 it should grow to some 

million.198

The growth of the American population 

important economic implications, one of wh

concerns the aging of the nation. Between 1

and 1998 the median age of Americans rose 

percent to a record high of 35.2.199 By 2025, 

national median age will rise another 10 perce

life spans follow recent trends—though med

advances could raise the median even highe

198 U.S. Bureau of the Census, International Data Base at

www.census.gov/ipc/www/idbprint.html.

199 “Americans’ Median Age Is 35.2, the Highest Ever,” Ne

York Times, June 15, 1999.

200 “Global Aging in the 21st Century,” U.S. Bureau of the

Census (Washington, DC: U.S. Department of Comme

December 1996).
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

While the United States will be the last of the

developed nations to experience the aging of

its population, by 2025 nearly 18 percent of

all Americans will be over the age of 65.201

As a result, the ratio of those in the workforce for every person receiving retirement

benefits will drop to about 2.3 to 1 from 3.9

to 1 in 1995.202

Other trends will offset some of the effects

and costs of an aging America, however. One is

immigration, but the extent to which it will do

so is a function of yet to be determined immigration policies. Another is a likely shift in the

retirement age as more Americans remain

healthy and active for longer periods. There is

also the venerable American tradition of private

plans to supplement the retirement income of

middle- and upper-income families.203 But

problems will persist. Health care costs will

continue to increase on account of both an

aging population and the advent of new treatments made possible by scientific discoveries

and technological innovations.204 In 2010, the

first of the baby-boom generation will become

eligible for Medicare, and by 2030 Medic

will be the primary insurer for one out of f

Americans.205 As the country ages, costs 

health care will constitute an increasing fi

burden and will stand in competition with o

spending, including spending for defense 

foreign policy. 

201 Peter G. Peterson, Gray Dawn: How the Coming Age W

Will Transform America—and the World (New York:

Random House, 1999), p. 29.

202 Marilyn Moon, "Medicare, Medicaid, and the Health C

System," Life in an Older America, Robert N. Butler,

Lawrence K. Grossman, and Mia R. Oberlink, eds. (N

York: The Century Foundation Press, 1999), p. 42.

203 In 1970 the foreign born percentage of the U.S. popula

stood at 4.7 percent; by 1997, it was 7.9 percent.

Campbell J. Gibson and Emily Lennon, Historical Ce

Statistics on the Foreign-Born Population of the Unite

States: 1850-1990 (Washington, DC: U.S. Bureau of t

Census, February 1999).

204 Peterson, Gray Dawn.

205 Moon, “Medicare, Medicaid, and the Health Care Syste

p. 41.

The Aging of the U.S. Population

Source: Population Projections of the United States by Age, Sex, Race, and Hispanic Origin: 1995 to 2050 (Washington, DC:

U.S. Bureau of the Census, 1996), p. 12.
U.S. Commission on National Security/21st Century 

118 NEW WORLD COMING

The racial and ethnic composition ofAmerica will also change. Minority

racial and ethnic groups will constitute a larger

proportion of the population as the nonHispanic white category falls from 72 percent

to 62 percent of the total population in 2025.206

Hispanics will become the largest minority

group by 2025, increasing their percentage of

the population from around 11 percent to

nearly 18 percent. The Asian/Pacific Islander

population will increase from almost 4 percent

to more than 6 percent. The black percentage of

the population is projected to remain fairly

stable, rising from about 12 to 13 percent. At

the same time, intermarriage is also changing

the country’s racial mix. Demographic data

suggest considerable intermarriage between

Hispanics and non-Hispanic whites and

between Asians and non-Hispanic whites.

Intermarriage rates are much lower between

blacks and other groups. Taken together, these

data suggest a more racially mixed American

society by 2025. 

What these data do not tell us is whe

such changes will be accompanied by gre

or less social harmony. Objective realities w

regard to relations between racial and eth

groups do not always match the perception

those groups. For example, while nearly ev

socio-economic and attitudinal indicator sho

the considerable progress made by bl

Americans over the past four decades, p

show that large numbers of blacks believe 

their relative situation is worse than it used 

be.207 Perceptions matter, and they have po

tial national security implications. Those w

feel alienated from others in their society are

balance, less likely to sacrifice for the comm

welfare.

206 All data in this paragraph are drawn from Population

Projections of the United States by Age, Sex, Race, an

Hispanic Origin: 1995 to 2050 (Washington, DC: U

Bureau of the Census, 1996).

207 Analyzed in Orlando Patternson, The Paradox of

Integration (Washington, DC: Civitas, 1997).

.

Increasing U.S. Ethnic Diversity

Source: Population Projections of the United States by Age, Sex, Race, and Hispanic Origin: 1995 to 2050 (Washington, DC

U.S. Bureau of the Census, 1996), p. 12.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

Education, too, will be a critical factor in

American social life, for it will affect

the quality of leadership in all spheres as well

as the technological competitiveness of

American society. Here the trends are mixed.

The United States ranks first among the industrialized countries in the size, scope, and

excellence of its undergraduate and graduate education. Hundreds of thousands of foreign

students are enrolled in American universities,

making U.S. schools the most sought after in

the world. Indeed, large numbers of Ph.D.

students in natural sciences and engineering

programs are foreign born—in excess of 30

percent in mathematics, computer science,

chemistry, physics, chemical engineering, electrical engineering, and mechanical

engineering.208 Many graduates stay in the

United States after completing their studies.

These general trends are projected to continue

over the next 25 years. 

At the same time, below the university

level U.S. education compares poorly with that

in other countries in several key aspects. In

mathematics and science, for example, U.S.

high school seniors have scored well below the

international average, with students from the

Netherlands, Sweden, Iceland, France, Canada,

Israel, Slovenia, Germany, Russia, and the

Czech Republic regularly outperforming

Americans.209 The poor U.S. performance in

high school math and science may jeopardize

America’s future economic and technological

competitiveness. More worrisome, the percentage of American students who take college

degrees in the hard sciences, mathematics, and

engineering is declining.210

Significant problems also remain with

adult illiteracy, with future effects that are hard

to quantify but that could be severe. Roughly

one-fifth of American adults have only rudimentary reading and writing skills, and 4

percent are functionally illiterate. Un

progress is made in this regard, the transfor

tive potential of the information revolution 

be proportionately limited.211

American society is experiencing so

positive social trends, among them shar

falling crime rates and strong job creation 

has permeated all social strata. But ot

problems loom. The number of children be

reared without both parents has gro

markedly in recent years, tracking with both 

creased divorce rates and out-of-wedl

births. In 1970, 14.8 percent of children did 

live with both parents; today, this figure sta

at 42 percent—nearly a tripling in less than 

years.212 This trend is especially pronoun

in some minority communities, where as m

as 80 percent of all children will spend a 

nificant part of their childhood with a sin

parent.213

This trend is worrisome because numer

studies have shown that children from sin

parent households are far more likely to 

poor, inadequately educated, and involved 

criminal activities than those that grow up w

both parents. Some 45 percent of child

living with a single parent live in pov

compared to less than 10 percent in two-par

208 National Science Foundation, National Science Board,

Science and Engineering Indicators, 1998, NSB-98-1

1998, pp. 3-19.

209 National Center for Education Statistics, “The Conditio

Education 1999 (NCES1999-022),” (Washington, DC

U.S. Department of Education, 1999), p. 6.

210 Ibid., p. 122

211 See National Center for Education Statistics, 1992 Nati

Adult Literacy Survey (Washington, DC: U.S. Departm

of Education, 1992).

212 Current Population Reports P20-496 (Washington, DC:

U.S. Bureau of the Census, 1996).

213 Noted in Michael Kelly, “A National Calamity,”

Washington Post, June 16, 1999, p. A37.
U.S. Commission on National Security/21st Century 

120 NEW WORLD COMING

households.214 Such children are more likely to

suffer malnutrition and lack adequate medical

treatment. Children from single-parent households also do less well academically, are more

likely to drop out of high school, suffer from increased levels of depression, stress, anxiety,

and aggression, and are far more likely to be

imprisoned.215

The sharp spike in the numbers of singleparented children over the past 30 years suggests

that as these children become adults between

now and 2025, the level of social dysfunction

may rise proportionately. Such social problems

affect the nation’s overall health and social

cohesion and therefore will capture the energies,

attention, and financial resources of various

levels of government, the national security community included.

Technology Trends

American preeminence in science and

technology will continue into the

coming century. At the same time, global trends

in technology will deeply influence American

society. 

With over 60 percent of the world’s Internet

users located in North America, the United States

plays a central role in the global network.216 No

country is as widely “wired” as America, or as dependent on information systems for basic

economic and social functions. Many more

American households and businesses will be connected in the future as extensive high-capacity

fiber optic lines are laid across the continent and

along our coasts.217 Increased amounts of information will be available at decreasing costs. The

Internet will not only have a major impact on 

education, research, and business life in America,

but it will also alter patterns of social interaction

within the United States, and those between

Americans and the world.

American society is likely to remain in 

forefront of the information revolution. Mos

the seminal scientific research and technolog

innovation is done in the United States, 

American society and the economy are v

receptive to new innovations. Neverthel

America’s relative lead in this field will lik

decrease as other societies adapt to the infor

tion age. Already, some other countries h

shown a special talent and affinity for a “wir

world, among them Finland, Australia, Isr

Japan, and Taiwan. But the spread of informa

culture around the world will not harm the Un

States; more likely its leading role will h

spread its influence.

Biotechnology will redefine the meaning 

“old,” but it will do more than extend life sp

and revolutionize medicine. As noted above, 

rapidly developing the potential to change hum

nature itself in fundamental ways, as well as 

nificantly modify many species of plants 

animals.218 Biotechnology is keeping Ame

on the innovative edge of the agricultu

medical, and chemical industries, which 

maintain the United States as a dominant acto

these sectors for at least the next quarter cent

214 Eileen Poe-Yamagata, “Children in Single-Parent Hom

1970-1996, adapted from the 1996 Green Book

(Washington, DC: U.S. Congress, 1998); and Curren

Population Reports P20-496 (Washington, DC: U.S.

Bureau of the Census, 1996).

215 Studies noted in Jason Fields and Kristin Smith, “Pover

Family Structure, and Child Well-Being Indicators Fro

the SIPP” (Washington, DC: U.S. Bureau of the Censu

1998).

216 See “Internet Development” in International

Telecommunications Union, Challenges to the Networ

(Geneva: ITU, 1997), chapter 2.

217 See Thomas P.M. Barnett and Pat A. Pentland, “Digital

Weave: Future Trends in Navigation, Telecommunicat

and Computing,” CAB 98-52, Center for Naval Analy

June 1998.

218 See the special feature issue of Scientific American, “Y

Bionic Future,” Fall 1999.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

However, it will also raise basic and divisive

ethical questions such as those involving access

to new and expensive technologies.

Another divisive issue will concern the increasingly blurred line between medical

necessity and “cosmetic” or elective remedial

procedures. It will be particularly difficult for

experts in medical ethics, insurance company

executives, doctors, and government administrators—separately and especially together—to

decide how to allocate limited medical resources

to a population deeply desirous of securing

access to new means of longevity.219 The international dimension to this problem may be just as

troublesome. How will the United States and

certain other fortunate countries manage the political and diplomatic implications of the

widening gap between life spans in their midst

and those in other countries? 

Similarly, those countries that are able to

fabricate and apply MEMs (micro-electromechanical devices) and nanotechnology are

likely to have a significant economic and

military edge over those who cannot. American

scientists and engineers will compete with their

Japanese counterparts to lead the drive to

miniaturization through micro-fabrication. So

revolutionary is the potential for nanotechnology that it may propel U.S. economic growth

rates above the high-mark predictions of most

experts. 

Taken together, these trends in science and

technology could change America in fundamental ways, from the way we get our food and our

news to how our national culture itself develops.

Even the cohesion of the nation—the emotional

bonds that link us to our past and to each other—

will not be immune from these trends. If, as

suggested earlier, technological trends narrow

our public space, eviscerate democracy, and

isolate social classes from each other, national

cohesion will suffer. If, on the other hand, th

trends are guided in such a way as to increase 

litical participation on the local level, bolster 

economy, and reverse income inequality, t

social cohesion may grow stronger. 

What we can predict with fair assuranc

that America’s overall edge in military 

military-related technologies will endure for 

next 25 years. This is directly related to the 

of U.S. military research and developm

spending, which amounted to $32 billion 

1996, nearly 70 percent of military R&D inv

ments worldwide.220 There is no reason to exp

dramatic changes in such trends. Moreover, si

R&D spending in general has shifted away fr

government and toward industry—and since 

U.S. lead in private sector R&D investmen

also considerable221 —the relative U.S. tech

logical edge may actually grow o

the next quarter century. Still, whether the U

government will succeed in applying that e

intelligently to its military capabilities rema

219 This technology is growing rapidly. Note Nicholas Wad

“New Study Hints at Way to Prevent Aging,” New Yor

Times, August 27, 1999.

220 Frank Killelea, “International Defense Trends and Thre

Projections: R&D Spending Trends,” briefing at the Jo

Hopkins University Advanced Physics Laboratory,

February 26, 1999.

221 According to National Science Foundation and OECD 

tistics, all non-governmental spending on science and

technology R&D in the United States (including busin

higher education, and private non-profit investment)

amounted to about $159 billion (in 1990 dollars) in 19

By way of comparison, Japan invested in total about $

billion, Germany invested about $33 billion, France ab

$25 billion, the United Kingdom about $20 billion, Ita

about $11 billion, and Canada about $9 billion. In oth

words, U.S. non-governmental R&D investment nearl

equaled the total R&D investment of its next six close

competitors. See National Science Foundation, Scienc

and Engineering Indicators, 1998, Appendix A, table 

42; and “Basic Science and Technology Statistics” at

www.oecd.wash.org.
U.S. Commission on National Security/21st Century 

122 NEW WORLD COMING

to be seen. This may depend on developing new

ways to insure that America’s burgeoning

private-sector technological assets are properly

inventoried, shared, and utilized for the overall

national good.

Economic Trends

The most dramatic effect of new technology on American society is likely

to be felt through its impact on the economy.

A stream of new innovations could spur very

strong economic growth over much, if not

all, of the next 25 years.

U.S. gross domestic product (GDP) in

1998 exceeded $8.5 trillion.222 As to the

future, one group of experts predicts 3

percent annual growth as the likely upper

limit of American economic expansion over

the next 25 years, which would double the

size of the American economy by 2025. If

correct, this forecast would mean that the

GDP would reach at least $16 trillion by

2025, creating the possibility of retiring the

entire national debt before 2025.223 Others

speculate that growth could even be higher

owing to the revolutionary technological innovations in our future, and recent studies

showing the effect of the information revolution in gains in productivity tend to bolster

such speculation.224

On the other hand, sharply curtailed

economic performance in the United States is

not impossible. A massive technological

failure, the advent of unexpected pandemics,

a major war, or consistently bad economic

policies could all produce much slower

growth—under 2 percent per annum.

Moreover, American growth rates depend at

least to some extent on economic performance in the rest of the world, a phenomenon

over which we have little control and one t

cannot be predicted with any assurance.

What can be predicted is the growing 

ternationalization of the U.S. economy. U

investment will remain a major factor in 

global economy, and the international sh

of the U.S. economy will increase because 

a growing dependence on foreign trade, 

vestment, and foreign ownership of U

economic assets. Between 1994 and 19

foreign direct investment in the United Sta

rose from $45 to $189 billion.225 U.S. fore

trade as a percentage of GNP rose from 

percent in 1970 to 24 percent in 1998.226 T

upward trajectory will continue so long 

global economic growth continues to aver

at least 2 to 4 percent over the next 25 ye

Despite likely strong economic grow

problems of income distribution within 

United States could become significa

Trends in income distribution matter beca

perceptions of basic fairness may aff

American social cohesion. Americans tra

tionally feel some ambiguity about extre

222 U.S. Department of Commerce, Bureau of Economic

Analysis, “National Data Accounts,” August 26, 1999

223 President Clinton first raised this possibility publicly on

June 28, 1999. See David E. Sanger, “Clinton Sees the

Possibility of Zero U.S. Debt by 2015,” New York Tim

June 29, 1999.

224 See Lohr, “Computer Age Gains Respect of Economist

225 Department of Commerce, Bureau of Economic Analys

“International Investment Data, Foreign Direct Investm

in the United States: Capital Flows,” at www.

bea.gov/bea/di1.htm.

226 “U.S. Aggregate Foreign Trade Data, GDP and U.S.

International Trade in Goods and Services, 1987-98,” 

Department of Commerce, Bureau of Economic Analy

at www. ita.doc.gov/industry/otea/usfth/tabcon.html.2

“U.S. Aggregate Foreign Trade Data, GDP and U.S.

International Trade in Goods and Services, 1987-98,” 

Department of Commerce, Bureau of Economic Analy

at www. ita.doc.gov/industry/otea/usfth/tabcon.html.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

disparities in income: they resent the rich and

long to emulate them at the same time. As

long as the gains of the wealthy are perceived

to be made fairly, on the basis of equality of

opportunity, their achievements have been

respected by most in the past. They also

tend to be tolerated more easily if the

fortunes of those lower down on the socioeconomic ladder are also improving. There

is no reason to suspect that these basic attitudes will change in the future.

Nevertheless, wider income disparities

increase pressures for social service

spending, potentially limiting the resources

available for other domestic and military

programs. What does the future look like in

this regard?

Between 1968 and 1994, the difference in

income levels between the wealthiest and the

poorest Americans grew 22.4 percent.227 In

1947, the top 5 percent of American families

owned 15.5 percent of the national income; by

1967 that figure reached 16.4 percent, and by

1994 20.1 percent. Put another way, the data

show the inflation-adjusted income of the

bottom fifth of working families in America

dropped by 21 percent between 1947 and 1995,

while the income of the top fifth rose by 30

percent.228 As important, real wages for a

sizable percentage of the American population

were stagnant for the better part of the last 15

years. Recent data suggest that both of these

trends may have been halted and even

reversed.229 But these new trend lines are too

new to project them confidently into the future,

and there is reason to doubt their continuation.

Global economic trends, in particular, may

contribute to a worsening of income inequality

in the United States. First, the continued

movement of the workforce away from

physical labor related to traditional industry

and toward information-age jobs in the service

sector could leave many Americans in 

lurch.230 Not everyone is equally adept 

acquiring the skills that are most importan

knowledge-based economies, and not every

will have access to quality education. Seco

the internationalization of labor sources and 

vestment opportunities could direct new 

and wage growth overseas, thus contributin

the sharpening of class divisions and inco

disparities in the United States.

Beyond that, emerging domestic inv

ment trends influenced largely 

opportunities in new technologies appear 

have a mixed impact on income inequality. 

the one hand, new business start-ups and 

job creation that goes with them will proba

remain strong, contributing to continuing

227 This metric defines the average national income and loo

at the distribution of people making more than the

average, relative to those making less. Establishing an

year arbitrarily as a base, the index counts the movem

of income distribution from one side of the mean to th

other.

228 Daniel H. Weinberg, Current Population Reports: A Br

Look at Postwar U.S. Income Inequality (Washington, 

U.S. Census Bureau, June 1996).

229 Noted in Tyson, “Wages and Panic Buttons.”

230 As of 1996, about 2.8 percent of Americans were engag

in agriculture, fisheries, and forestry. About 23.8 perce

were engaged in manufacturing, and the rest, some 73

percent, were engaged in services (including public

services at the federal, state, and local level). See OEC

Labor Force Statistics, 1976-1996 (Paris: OECD, 1997

The Bureau of Labor Statistics projects that by 2006 h

tech employment will be nearly 16 percent of total

employment. Employment generated by the purchases 

goods and services by high-tech industries for use as

inputs in their production process will grow faster than

high-tech employment, increasing by 54 percent betw

1996-2006. See, Daniel Hecker, “High-technology em

ployment: a broader view,” Monthly Labor Review, Ju

1999, pp. 18-28, and especially U.S. Department of

Commerce, Falling Through the Net: Defining the Dig

Divide (Washington, DC: USGPD, 1999).
U.S. Commission on National Security/21st Century 

124 NEW WORLD COMING

increasing, social mobility.231 This could lead

to a greater equalization of income over time

within the top half to two-thirds of the U.S.

labor force. But that might not translate into

significant numbers of new jobs at lower

economic echelons since much new technology is aimed at minimizing low-end human

participation in commercial processes. Hence,

an American economic underclass will not

disappear and may even grow. It is too early to

say whether such trends will increase unrest or

social fragmentation in American communities, but the possibility will doubtless

command the attention of America’s leadership in the years ahead.

Values, Attitudes, and National Will

The cohesiveness of a society, its will,

and its civic consciousness form the bedrock

of national power. The United States is

unusual among nations in that its national

identity hinges more on shared ideals rather

than common ethnicity. But while the foundation of U.S. national power might appear less

secure than in more ethnically homogeneous

societies, experience does not bear out that

prognosis. For all our disagreements and divisions, Americans have demonstrated

historically that they possess a strong collective identity and that they rise to challenges

when necessary. The key question for the

future is this: When we are next challenged,

perhaps in a manner beyond our historical experience and powers of anticipation, will our

social cohesion endure or will it erode? There

is considerable disagreement over the answer. 

Some observers are quite worried, based

on the view that American society has

become dangerously fragmented along

ethnic, racial, and sectarian lines. In this view,

the growing cultural emphasis on the multicultural facets of American society has 

over time to a growing inclination for m

Americans to think of themselves as memb

of social subgroups. A shift toward celeb

ing differences, rather than commonalit

among Americans has changed the bala

between national and sub-group identit

Paradoxically, as America has become 

strictly “color” conscious over the past 

years, it may have become more ethnic

conscious. The unrestrained assertion of 

ferences could push a benign impulse tow

pluralism into fragmentation, undermin

the sense of a shared national purpose

The effect on foreign policy, some argue

already evident. As James Schlesinger has 

it: “Rather than reflecting a hammered-

vision of the national interest, Americ

present policy consists largely of the stapl

together of the objectives of individual c

stituencies. . . .The new intellectual fashi

weaken and, in a sense, delegitimize 

search for [a] common purpose. They abet 

fragmentation of society.”233

There is concern, too, about changes in 

attitudes of younger generations. The streng

ening of group consciousness has not expun

individualism as a principal American trait, 

the members of Generation X—those b

between 1965 and 1978—seem to exhibit 

individualism of a different sort. According 

some observers, it is a more cynical individu

231 Entrepreneurship in the United States far outpaces that 

most other societies. In the case of Europe, American

business start-ups per capita overshadow those in EU

countries by a factor of more than 4 to 1. See 1999 Gl

Entrepreneurship Monitor, summarized in Julia Flynn

“Gap Exists Between Entrepreneurship in Europe, No

America, Study Shows,” Wall Street Journal, July 1, 1

232 See Arthur Schlesinger, Jr., The Disuniting of America

(New York: W.W. Norton, 1992).

233 James Schlesinger, “Fragmentation and Hubris,” The

National Interest, No. 49 (Fall 1997), pp. 4, 6.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

ism aimed at shielding the young from what

they often perceive to be the excessive hype

and hypocrisy of contemporary American

culture.234 Such “ragged” as opposed to

“rugged” individualism may not be conducive

to a healthy engagement in civil society. The

1998 Final Report of the National Commission

on Civic Renewal, co-chaired by William J.

Bennett and Sam Nunn, noted a significant

decline in the nation’s willingness to participate

in civic activities over the last 25 years, particularly among the young, and warned that “we

are in danger of becoming a nation of spectators.”235 Harvard political scientist Robert

Putnam, too, has argued that civic engagement

is diminishing. He notes that voter participation

in national elections has declined by 25 percent

over the last 30 years, and that 75 percent of

Americans said in 1992 that they had little or

no trust in the federal government—an increase

of about 45 percent since the mid-1960s.236

That fact that political participation at local and

state levels may be increasing, though good

news in some important respects, does not necessarily augur well for the coherence of policy

at the national level.237

In addition, some fear that the propensity of

the average American to identify with this

country and its government may be waning.

Several reasons are cited, one being that as

America’s economic life becomes increasingly

internationalized, political loyalties will follow

the source of paychecks. Others point to the

diminution of overt acts of national identification, such as school children saying the pledge

of allegiance, voting, attending a July 4th celebration, the traditional observance of Memorial

Day, the willingness to serve on a jury, and

saying a prayer for the country in one’s house of

worship. Relatedly, others fear that public education in the United States does not emphasize

the teaching of civics as it once did, and still

others that without any explicit ideolog

challenge to American values, as there 

during the Cold War, there is less reason 

learn and to cherish those values. Others n

that as the heroic generation of World Wa

passes from the scene, ever fewer Americ

will have models of those who served 

uniform in an unambiguously “good war.” 

Stephen Ambrose has written: “My grea

fear about today’s young people is that t

will grow to adulthood without the sense o

common past or a common experience.”238

Finally, many of those worried about 

future coherence of American society find l

to comfort them in the American foreign po

tradition itself. The United States has little 

perience of an active foreign policy strat

outside this hemisphere except under con

tions of national emergency or ideolog

mobilization. We have had the luxury of be

able to protect our security through strateg

that were primarily responsive to fore

threats. In the absence of such a threat, we h

experienced mostly periods of heated but 

conclusive debate over the American missio

the world. Some observers believe that, w

the end of the Cold War, we are headed b

into such a period—this despite the fact 

global trends suggest that threats to Americ

and their homeland are increasing. As a res

some believe, foreign policy questions are 

234 See Ted Halstead, “A Politics for Generation X,” The

Atlantic Monthly, August 1999.

235 A Nation of Spectators: How Civic Disengagement Wea

America and What We Can Do About It, Final Report 

the National Commission on Civic Renewal (Washing

DC: June 1998).

236 Robert Putnam, “Bowling Alone: America’s Declining

Social Capital,” Journal of Democracy, January 1995.

237 See Deconstructing Distrust: How Americans View

Government.

238. Stephen Ambrose, “The End of the Draft, and More,”

National Review, August 9, 1999.
U.S. Commission on National Security/21st Century 

126 NEW WORLD COMING

likely to divide us as bring us together, and

heated argument as likely to emaciate the

national will as fortify it. 

Taken together, multicultural fragmentation, the internationalization of the economy,

shifts in generational attitudes, the decline in

overt manifestations of national identification,

and our traditional inattention to foreign policy

issues in the absence of a crisis, suggest to

some a serious undermining of American

identity and national will. If so, we would thus

behold a country that, though strong and

wealthy, would be less willing to sacrifice for

the common good. 

The jury is still out, however, as to the

true extent of the problem—and its

future. Despite lower voting numbers, some

scholars see little decline in volunteerism and

community involvement.239 There has been no

fundamental change in basic civic values,

either. As in the past, Americans remain a

nation of “joiners” who have excelled in

coming together in “intermediate organizations” to enrich the relationship between

individual citizens, their communities, and the

larger national society. Americans are more

involved in volunteer, philanthropic, and community organizations per capita than any other

people in the world.240

Individual identity with the country, as expressed through individual expressions of

concordance with fundamental American

values, also seems to be strong. Survey data

show that Americans have not ceased seeing

their country as exceptional, have not stopped

honoring those who have served in uniform,

and have not abandoned the conviction that

America is a benign force in the world.

Americans today seem to place no less importance in the rule of law, democratic governance,

and the protection of liberty than they ever did.

The dignity and worth of the individual 

counts, and commitment to social jus

remains robust. The entrepreneurial sp

remains strong, as does the belief that h

work pays off. As a nation of immigra

Americans still exalt merit over the happ

stance of birth. Polling data also suggests 

Americans remain generally positiv

disposed toward themselves, regarding 

nation as a generous, moral, and just one tha

well worthy of emulation by others.241

Still others note that organized religion a

provides a basis for social cohesion, and 

remains a powerful force across the country

the Founding Fathers understood, commu

religious life brings people together, transm

moral values across and among generatio

encourages community action, and supp

family life. The data show clearly t

Americans actively participate in organized 

ligious organizations more than any people 

the developed world.242

Insofar as the American diplomatic tr

tion is concerned, many argue that even h

239 John Hall and Charles Lindholm, Is America Breaking

Apart? (Princeton: Princeton University Press, 1999)

240 See James E. Curtis, Douglas E. Baer, and Edward G.

Grabb, “Voluntary Association Membership in Fifteen

Countries: A Comparative Analysis,” American

Sociological Review, Vol. 57 (1992), pp. 139-52; and

Virginia A. Hodgkinson and Murray S. Weitzman, Giv

and Volunteering in the United States (Washington, D

Independent Sector, 1996).

241 Relevant polling data may be found in Gallup polls. Se

for example, “Satisfaction with U.S.,” and “Religion:

Gallup Social and Economic Indicators, 1999,” at

www.gallup.com.

242 See American Religious Data Archive, Lilly Endowmen

Dept. of Sociology and Anthropology, Purdue Univers

Queens 1996 Survey. Also see Richard Cimino and D

Lattin, “Choosing My Religion,” American Demograp

Magazine, April 1999, and Shelly Reese, “Religious

Spirit,” American Demographics Magazine, August 19
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

there is cause for optimism. In the past, it is

true, U.S. expeditionary military forces and

foreign commitments were downsized or ended

as soon as a foreign danger had passed. But, so

the argument goes, it has been a long time since

that pattern was visible. It was overshadowed

following World War II, and now that the Cold

War is over, America’s economic and political

commitments have cast it as the apparent guarantor of global stability. In recent years, and

despite the military downsizing that followed

the Cold War, U.S. troops have operated in over

one hundred different countries. 

The American people appear to support that

posture. One recent survey notes that Americans

prefer a policy of “guarded engagement”:

clearly committed to American participation in

world affairs when such participation is seen to

be in pursuit of their own interests.243 Other

studies characterize public support for an active

American role in the world as one of “supportive indifference.” In other words, the body

politic evinces little feeling for or against most

foreign policy or defense issues as long as they

exact no great cost in blood. This appears to be

borne out now by more than a decade’s experience. Since the end of the Cold War, the United

States has embarked on nearly four dozen

military interventions in the past decade as

opposed to only 16 during the entire period of

the Cold War.244 Many of these interventions,

such as those in Somalia, Haiti, Bosnia, and

Kosovo, were launched into areas traditionally

considered marginal to U.S. interests. None

rallied the national will nor captured the public

imagination even in the way the Gulf War did,

and few post-Cold War interventions have had

the support of the majority of the public. Yet

only one ended abruptly due to a lack of political support. 

I

n the face of this debate, we simply do

not know the extent to which American

society might fragment or lack the will 

common action when it is required in 

future. It would depend on how current tre

evolve, on the nature of the challenge 

America will confront, and on the qualitie

American leadership between now and then

That we fear fragmentation is probabl

healthy thing—as long as we do not go ov

board—for it leads us to guard against it. In 

event, this is our legacy: For good reason, 

fear of fragmentation has a long history 

American political and social thought.245 

reality, however, may not be so dire. For al

our problems, one fact stands out: La

numbers of people around the world still l

to come to America, and they long to beco

Americans. It is not just the prospect of gre

material wealth that attracts so many, but 

prospect for freedom and human dignity 

goes along with it. This suggests that Ameri

culture retains at least some degree of coh

ence and underlying unity.

Finally, it almost goes without saying 

the American national will to remain an ac

force in global affairs depends to some deg

on the state of the world. The emergence o

relatively benign international environm

would sit well with American values, s

image, and assumptions about how the wo

works. In circumstances where American po

243 John E. Rielly, ed., American Public Opinion and U.S.

Foreign Policy (Chicago: Chicago Council on Foreign

Relations, 1999).

244 For the list as it stood before the Bosnia and Kosovo in

ventions, see Richard F. Grimmett, Instances of the U

of United States Armed Forces Abroad, 1798-1995,

Congressional Research Service Report 96-119F, Febr

6, 1996, pp. 18-25.

245 See Barry Glassner, The Culture of Fear (New York: B

Books, 1999), and David Whitman, The Optimism Ga

The I’m OK-They’re Not Syndrome and the Myth of

American Decline (New York: Walker and Co., 1998).
U.S. Commission on National Security/21st Century 

128 NEW WORLD COMING

can advance the values we hold to be universal

in application, an active global U.S. role is

assured. The challenge would be to leaven

American exuberance with patience and

probity. But in a world that mocks our values,

deflates our optimism, threatens our life and

limb, and seems unresponsive to our best efforts

to help, a return of the isolationist impulse is not

beyond imagination. Rather than an America 

radiating light from Governor Winthrope’s “city

on a hill,” Americans may convince themselves

that Hobbes’ adjectives for political life in a

state of nature, “nasty, brutish, and short,” far

better describe global realities and decide that

all forms of charity should indeed begin at

home. This is an important difference, for what

Americans believe about the world and their

role in it will constitute a major datum in the

global story that will unfold over the next 25

years.

Trends Affecting National Security

The social, economic, and technological trends noted above suggest that, in

a broad sense, America will not want for

means. We will be wealthy, and we will be

healthy. But they suggest that social problems

and a general inattention to issues of national

security could systematically prejudice

national budgets away from investments in

national defense. Both of those potential

problems would in turn worsen a third, structural problem: the way we organize military

manpower. 

Since the nation abolished conscription a

quarter century ago, our military forces have

depended successfully on volunteers. Recent

data indicate that the American population

will not be as obliging as in the past, especially if the economy continues to prosper. For a

variety of reasons, recruiting has been a

steadily growing problem for nearly two

decades. Short thousands of recruits, 

services have lowered entrance standards 

reinvigorated recruiting efforts, promptin

renewed debate about mandatory natio

service and the return of the draft. Retentio

also problematic. A booming economy an

heightened operational tempo are siphon

off large numbers of trained personnel 

lowering re-enlistments, as has been parti

larly the case with pilots in recent years. 

In the future, challenges to recruitment 

retention will be formidable, although th

will depend to a considerable extent on d

sions made about force structure and readin

requirements. The Pentagon’s most rec

attitude surveys show that the willingness 

16 to 21-year old men to serve—especi

African-American men, who have constitu

a disproportionate percentage of the all-vol

teer force for the last quarter century—

dropped sharply over the past deca

Moreover, Hispanics, the fastest grow

segment of the American population, 

greatly underrepresented and show no sign

increasing their inclination to serve

Although the percentage of women in 

armed forces will continue to rise, th

numbers are unlikely to make up for the dec

in male enlistments. Data show that 45 percen

the women who enlist leave the military be

the end of their first tour of duty, as compa

with the average of 34 percent of men. They 

also less deployable, at least under current op

ational guidelines.247 Efforts to furt

“outsource” certain military functions to civi

246 See David Segal, Jerald Bachman, Peter Freedman-Doa

and Patrick O’Malley, “Propensity to Serve in the U.S

Military: Temporal Trends and Subgroups Differences

Armed Forces & Society, Spring 1999, p. 421; and Llo

Matthews, “Primer on Future Recruit Diversity,” in

Population Diversity and the U.S. Army (Carlisle, PA: 

Army War College, 1999), pp. 1-6.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

contractors cannot compensate for the recruiting

shortfall in military combat specialties, most of

which women and civilians cannot fulfill under

current policy. It is not clear how the military establishment, then, will sustain the volunteer

force over the next generation, and particularly,

how it will manage to recruit and retain enough

highly skilled personnel to meet the increasing

technical needs of an advanced military.

These trends portend—and in some ways

reflect—a growing distance between America

and its military. With ever fewer Americans

serving in the military, society’s understanding

of the military’s purpose and relationship to the

country and the government is bound to

weaken. While the military remains one of the

most admired public institutions in America, it

is admiration from afar—appreciation from a

mostly non-participating populace. The impact

of this divide may be felt most keenly at elite

levels. The number of leaders in almost every

walk of American public or private life who

have served their country in uniform is rapidly

declining. The profile of national leaders

dealing with strategic affairs reflects these

trends. The House of Representatives had 320

veterans in 1970, but fewer than 130 in 1994.

For the first time in the 20th century, the percentage has now fallen below the percentage of

veterans in the population at large. If these

trends continue, a small professional military

will stand increasingly apart from the country

and its leaders. Such a civil-military balance

could further divorce Americans from their

government and serve to loosen identification

with, and participation in, a common national

purpose. 

The changing role of the American military

is part of this picture, both in terms of civilmilitary relations and in terms of readiness. The

relationship between the military and society

could be affected by the use of the armed forces

in domestic missions such as drug interdict

law enforcement, or border security. In cer

circumstances, however, such as the protec

of the homeland from a clear threat, that r

tionship could be enhanced. Assign

domestic missions to the armed forces co

also erode military readiness for wartime op

ations abroad. There are formidable le

hurdles to the assigning of such missions

well, but some American leaders seem wil

to jump them.248

A weaker societal understanding of 

military, combined with the downtrend in 

cruiting, has led some prominent American

suggest a return to conscription, programs 

national service, or a militia-based force

Others, while acknowledging that such 

proaches would strengthen civic participat

point out that a conscript military might li

an active foreign policy that frequently p

conscripted American soldiers, sailors, airm

and marines in harm’s way.

The ability to carry out effective fore

and military policies requires not only a ski

military, but talented professionals in all fo

of public service as well. Government inst

tions face similar challenges as they comp

for people with the corporate sec

247 See Military Attrition: Better Data, Coupled with Polic

Changes, Could Help the Services Reduce Early

Separations, GAO Report NSIAD-98-13, September 1

and F. E. Garcia, K. S. Lawler, and D. L. Reese, Wom

at Sea: Unplanned Losses and Accession Planning, C

for Naval Analyses Research Memorandum 98-182,

March 1999.

248Sam Nunn proposed domestic roles for the U.S. military 

1992 and Bob Dole and Lamar Alexander made simila

proposals during the 1996 presidential campaign. See

Charles Dunlap, “The Origins of the American Militar

Coup of 2012,” Parameters, Winter 1992-93, pp. 2-20

249 One example is Gary Hart, The Minuteman: Restoring 

Army of the People (New York: Free Press, 1998).
U.S. Commission on National Security/21st Century 

130 NEW WORLD COMING

Employment trends for those entering the field

of international relations show that growing

numbers of graduates of foreign affairs

programs are entering the private rather than

the public sector.250

What does all of this come to? One

observation is unarguable: the stability and direction of American society and

politics will shape U.S. foreign policy goals

and capabilities, and hence the way the United

States will affect the world's future. Beyond

that, one other major theme stands forth.

The United States has a certain spirit, and

it is the spirit of the first and greatest mass

democracy in history. And yet since the end of

the Cold War we have taken on, however reluctantly and even absent-mindedly, a world role

that requires much potential sacrifice and the

mobilization of substantial national resources

and will. Can this role coexist for very long

with an America that does not feel threatened,

and that is focused instead on domestic issues?

Perhaps it can, but if so, it must be shown, not

assumed, to be the case. That is a challenge not

yet seriously taken up at the level of national

debate. 

Notwithstanding the post-Sputnik dangers

of a nuclear missile attack from afar, U.S.

national security policy in the 20th century has

been something that mainly happened “the

in Europe or Asia or the Near East. Dome

security was something that happened “he

and it was the domain of law enforcement 

the courts. Rarely did the two mix. The dist

tion between national security policy 

domestic security is already beginning to b

and in the next quarter century it could a

gether disappear. If it does, if such thr

become reality, or even if they merely beco

more apparent, Americans are likely 

abandon their attitude of “supportive indif

ence.” That would affect demands 

leadership to respond to such threats, an

would likely affect national budgetary pri

ties, as well. Depending on the nature of s

threats, very divisive arguments could er

over the proper role of the military in inter

security operations. 

If the stakes rise in such a fashion, 

thing is likely to become vividly clear: 

American people will be ready to sacri

blood and treasure, and come together to do 

if they believe that fundamental interests 

imperiled. But they will not be prepared 

make such sacrifices over indirect challeng

or over what seem to them to be abstract m

imperatives. That is the history of American 

sponses to foreign challenges, and that appe

also to be its future.

250 Over the 1991-1997 period, the proportion of those gra

ates entering the private sector increased 10 percent (u

from 32 percent to 42 percent), and student demand fo

business and finance courses in these programs is on t

rise. Although the number of candidates taking the U.

State Department’s foreign service exams has shown l

change, those entering the Foreign Service are serving

shorter tours due to increasing competition with privat

industry.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

IV: Worlds in Prospect 

As we noted at the outset of this study,

human history is contingent. We

cannot know what the world will look like over

a quarter century away because many of the decisions that will shape that world have not yet

been made. Moreover, there are too many different interactive causal factors involved,

encompassing geophysical, economic, political, social, and military elements, to know

which single, composite “world” will issue

forth from them. Alas, perfect knowledge of the

future is impossible, and Nietzsche came close

to hitting on the reason: “No one can dream

more out of things, books included, than he

already knows. A man has no ears for that

which experience has given him no access.” In

other words, our repertoire of expectations is

limited by our repertoire of knowledge.

One way to overcome this difficulty is to

tease our imaginations into walking ahead of

our experience. We can do this by constructing

logical models of alternative futures, in this

case, by building global scenarios. We do this

not at random, but by defining clusters of likelihood derived from what we know about how

the world works. The scenarios can then be

used as heuristic devices to help us understand

the ways in which the world may evolve over

the coming 25 years. 

The global scenarios that follow describe

the integrated interplay of developments in

technology and economics with the social, political, and military environments. By giving us

essentially real-time connectivity with anyone

anywhere, technology has provided a venue for

unifying the world and influencing events

globally. Yet the adoption of new technologies

generates pressures to transform or even overthrow existing political and social orders. The

emergence of a global economy encourages 

ternational cooperation and interdependen

but it can also lead to economic competi

and even disintegration. States will succeed 

fail depending on whether they are able to se

the opportunities of globalization and at 

same time deal with the accompanying dislo

tions. In the social world, the integrating for

of secularization may or may not win out o

the divisive forces of parochial nationalism 

other ideologies. Global security will 

enhanced if economies grow and political lib

alism expands, or endangered if the wo

divides amid major tensions and conflicts.

The different ways in which these un

tainties are resolved form the basis for f

worlds: The Democratic Peace; Protection

and Nationalism; Globalization Triumph

and Division and Mayhem. The first two 

evolutionary scenarios, one tilted toward 

optimistic side of life, the other toward 

more pessimistic. The last two are revoluti

ary scenarios, also tilted in positive 

negative directions. To a great extent, the th

scenario is an extension of the first, and 

fourth extends the second. These are, in tu

followed by a speculation that the first qua

of the 21st century will be a patchwork of 

four worlds.

A Democratic Peace

Afuture world of a Democratic Pehas three essential elements. Fi

democratic norms predominate, and these 

conducive to economic cooperation 

general prosperity. Second, sharp ideolog

conflict does not exist, and while cultural 

ferences remain real, they appear to 

converging rather than widening. Third, 

advanced level of political cooperation am

states is achieved and maintained. War am

major powers would be unlikely, and 
U.S. Commission on National Security/21st Century 

132 NEW WORLD COMING

among most democracies even more

unlikely.251 The principle of national sovereignty is tested by new problems and eclipsed

somewhat by the introduction of new international arrangements. But the principle

endures. 

Economically, moderate growth is

assumed, with developed countries averaging

around 2-3 percent annually and developing

countries averaging 4 to 5 percent annually.

Economic crises continue to occur in developing countries, but their severity is lessened

through improved transparency and regulatory

measures gradually introduced over time, and

through essentially benign pressure from

reformed and increasingly well respected international financial institutions. Key countries,

rather than international institutions or multinational corporations, still control global

economic policies, but multilateral economic

cooperation is expanded through the IMF, the

World Bank, the WTO, and a G-9 grouping that

includes China. 

The information revolution continues and

deepens, creating a world of integrated intranets existing on the overall edifice of the global

Internet. States adopt new standards to help

improve protection of the critical information

infrastructure. The revolution in biotechnology

proceeds, with most governments—and all the

major ones on whose soil biotechnological

research is proceeding—having managed to establish minimum controls over areas of

particularly contentious ethical concern.

There will still be plenty to worry about in

such a world. Global inequalities will prove

vexing. Economic infrastructures will be vulnerable to attack. Some dangerous technologies

will still evade control. The few remaining

holdouts from the increasingly institutionalized

normative order will be able to do far m

physical harm than heretofore. 

But a world characterized by greater 

portunities for cooperation among major st

will be a world in which multilateral actio

the rule rather than the exception. At the glo

level, states will advance the formulation 

enforcement of normative international l

The United Nations is a chief instrument in 

solving transnational issues. Regional tr

entities will increasingly coordinate th

foreign and security policies. Multilat

efforts stress conflict prevention. Major st

devise ways to deal with the demands of 

grieved ethnic or sectarian minorit

Like-minded governments cooperate, and in

tutionalize that cooperation, to respond 

“rogue” regimes or armed terrorists.

In the absence of significant secu

tensions, military power functions more 

reassure and deter than to compel. Mili

spending worldwide declines as a share 

GDP, but not precipitously so. Governme

maintain modest research and developm

efforts in leading edge technology areas, s

as space exploration. But modernization 

have slowed down and military arsenals 

have been reduced. The proliferation 

weapons of mass destruction is curbed and

some cases, rolled back.

This world is a positive evolution 

today’s world. The United States continue

emphasize support for democracy and 

markets. It remains militarily strong, w

adapting its force posture to this more peac

251 This scenario should not be equated directly with the

version of the political theory of the same name that

argues that war between democracies is virtually impo

ble. Charles Dunlap, “The Origins of the American

Military Coup of 2012,” Parameters, Winter 1992-93,

pp. 2-20.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

world. U.S. self-restraint helps prevent a peer

competitor or regional grouping of powers

from arising to challenge the United States. 

Protectionism and Nationalism

The stalling of global economic integration, the eventual creation of regional

power blocs, and the rise of nationalism characterize a world of Protectionism and

Nationalism. Such a world comes into being on

account of a protracted global financial crisis, a

major environmental or technological disaster,

or widespread political and social backlash

against globalization and Western—and specifically American—pretensions to hegemony. 

There is global economic growth, but

living standards in much of the developing

world decline. The failure of governments to

deliver on social needs, as populations grow

and resources dwindle, produces social unrest

in many countries. Latin America, Asia, and

Africa are particularly hard hit, given their high

dependence on external financing and export

markets. 

The so-called Washington Consensus,

based on the belief in the saving power of

global commerce and international economic

institutions, has come to an end. States instead

seek to protect their citizens from the ill effects

of unfettered trade, capital movements, and the

spread of technology. Many states, including

possibly the United States, abandon international trade agreements, such as the WTO. A

fundamental ingredient for global growth—the

relatively free flow of trade and capital across

borders—is significantly decreased in scope,

given the increased risks to capital and the introduction of protectionist trade barriers.

Cross regional alliances emerge, perhaps a

NAFTA-Europe political and economic pact or

a Latin American regional grouping. Given 

significant domestic savings rate and grow

populations, Asia seeks to provide its o

regional source of growth. Assuming gre

global dependence on fossil fuels, the N

East becomes a pivotal focus of global cour

and potential contention. But protection

mingled with parochial nationalism has m

baneful effects within regions, and that 

where the danger of conflict and violenc

greatest.

With protectionism on the rise, many st

impose controls and other regulations on 

spread of technology. That feeds the econo

slowdown and limits somewhat the “inter

tionalizing” effects of the informat

revolution. The Internet fragments globally 

becomes localized in the developed countr

Governments, corporations, and individuals 

little benefit to being connected. Rather t

sharing information, they hoard it.

In this world, economic, social, and po

cal dislocations are widespread. National

and ethnic rivalries increase in number and 

portance. Significant political changes occu

some key states, leading to the creation 

highly nationalistic, fundamentalist religio

and even fascist political regimes. Some imp

tant states fragment or fail, giving rise 

violence, humanitarian disasters, major cata

ic regional crises, and the spread of danger

weapons.

Military capabilities and alliances incre

in importance. Spending on military for

rises as states placed renewed emphasis on 

quiring and using military force. Developme

in military technology have produced advan

ments in nanotechnologies, miniaturizat

stealth, and anti-stealth. Weapons of mass 

struction proliferate to a number of sma

regional powers. Space is weaponized 
U.S. Commission on National Security/21st Century 

134 NEW WORLD COMING

becomes a locus of competition and conflict

among the more technically advanced countries. 

This world is a negative evolution of today’s

world. Initially, the United States is unequalled

in economic and military power. However,

within 15 years, a number of regional economic

competitors arise, as well as a peer competitor

or hostile coalition with the military means to

challenge the United States. The United States

retains a large military force capable of responding to a range of contingencies, including

future inter-state conflicts. 

Globalization Triumphant

I

n a world of Globalization Triumphant,

the world economy grows at an unprecedented pace. Modern technology spreads

worldwide. All national economies, with few

exceptions, are networked into the global

market. Trade in goods and services along with

capital flows expand globally, as do multilateral institutions and international agreements

designed to manage the new economy.

On the national level, states will have been

able to design and introduce responsive systems

of governance capable of preventing major

economic dislocations and social tensions. They

will have adopted policies conducive to

economic growth, including appropriate legal

systems and economic regulations. Despite

some lingering tensions, governments around

the world will have continued to move toward

free trade, advancing overall global prosperity

and supporting political liberalization.

Economically, growth in the developed

world is assumed to be at or above 2 percent a

year, and in the developing world 5-6 percent a

year. The share of global GDP held by developing countries comes to exceed that of

developed countries. Tariffs are eased and tr

increases globally. Global energy prices rem

stable or drop due to major technological in

vation. No major protracted downturn in 

major industrialized country or region occ

and no major conflicts between states or wi

states arise to destabilize the global econom

financial flows. Some transnational threats 

remain, including those from cultists, terrori

drug traffickers, and other criminals. Econo

infrastructures also are vulnerable, but w

fewer disgruntled groups and more effec

voluntary controls on trade in dangerous s

stances, that vulnerability is modest 

receding. 

The combination of global economic i

gration and the diffusion of technology lead

a fundamental change in the ability of state

influence events on the world stage. In essen

information and economic power become tr

globalized, while military and diplom

power remain the prerogatives of states. 

addition, supra-national organizations and n

governmental organizations increase th

influence. 

Individuals and governments in this wo

share such goals as a reasonably equitable 

tribution of income, equal educational and 

opportunities, the peaceful resolution of c

flicts, sustainable environmental policies, 

individual human rights. Nearly every

accepts as second nature the benefit of being 

tegrated and connected, and, like the web its

political and economic structures are incre

ingly decentralized. That offers a gre

opportunity for local political participation 

individual citizens.

Security establishments around the wo

including that of the United States, are fa

with a dilemma. Technological advanceme

and economic growth create new possibili
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

for advanced weaponry. But the world has

evolved in such a way that dramatic reductions

in threats have occurred and interstate wars have

become increasingly unlikely. The United

Nations or a similarly representative body

assumes a central role in conflict prevention and

resolution. As resources shift to social programs

and the protection of critical infrastructures,

there is tremendous downward pressure on

defense budgets. Classic conventional military

forces atrophy. Space becomes a realm of cooperation. International regimes have established

far more effective controls on the proliferation of

weapons of mass destruction. 

The United States is an active “partner”

with states around the world in promoting cooperation through international institutions. In

its military posture, the United States focuses

primarily on defensive measures aimed at responding to the few remaining threats. As

Americans exercise influence through cooperative international mechanisms, resentment of

American and Western culture subsides. 

Division and Mayhem

Aworld of Division and Mayhem could

come about by any of several routes.

One is uncontrolled technological diffusion

that outpaces the legal, moral, and ethical strictures of societies around the world. A second is

the accentuation of strains in the globalization

process, to the point of touching off a worldwide economic recession and, in time, global

chaos. A third is a compound global environmental crisis. The three sources of division and

mayhem could occur simultaneously, each reinforcing the other two.

In this world, however it comes to be,

global economic growth plummets. Private

sector investors worldwide experience a deep

crisis in confidence. Investment is limited, and

trade is vastly reduced with the drop in ma

demand and dramatic increase in protectio

policies. International lending institutions l

funds. The world is characterized by the coh

itation of a small cluster of relatively r

developed—and mainly Western—states, an

large group of struggling and often very p

states. These states also experience exten

uncontrolled urbanization, environme

degradation, and political fragmentation. 

The lofty internationalist principles beh

the Internet are rejected; information 

marketed and hoarded instead of cultivated 

shared. Most developing countries are den

access to technological innovations, eit

because they cannot afford them, or for 

that they cannot control them properly. In 

developed world certain technological devel

ments, especially in biotechnology, outpace 

ethical debate over their implications. A n

class of biotechnology criminals and cyber

rorists appears and is linked to officials 

demoralized and divided governme

Disaffected individuals and groups acquire 

technologies necessary to develop the m

dangerous weapons, and some are used.

Many states fragment along eth

cultural, and religious lines. Disparities in 

sources lead to or aggravate conflict betw

groups within societies and among regio

states. Increased numbers of displaced pers

produce extensive humanitarian disasters 

exacerbate environmental problems. Mili

conflict between and especially within st

increases.

Private and non-state militaries are on 

rise, while the United Nations and other col

tive security organizations decline. Mili

establishments around the world confron

variety of threats. Some are well-funded 

others are not, giving rise to abruptly shif
U.S. Commission on National Security/21st Century 

136 NEW WORLD COMING

balances of power, miscalculations, and

ruinous wars. 

While frequently called on to conduct humanitarian missions and operations other than

war, the U.S. military also confronts a number

of states, acting alone or in alliance, seeking the

final removal of American military power and

influence from their respective regions.

Throughout this period, the United States

invests heavily in military modernization, but

low economic growth limits the size of military

budgets. In this environment U.S. foreign and

defense policy establishments are under increasing strain. The United States also finds

itself increasingly isolated and overstretched in

attempting to meet its security needs both at

home and abroad. 

Under such circumstances, deadly attacks

on U.S. cities by a terrorist group using

weapons of mass destruction cause a sharp reorientation of basic U.S. policy. The United

States reaches out in anger to punish and to root

out future sources of such attacks but otherwise

pulls back from its commitments in the world at

large. Thus deprived of American good will and

active involvement in global leadership, a

world already plagued by division and mayhem

falls further into a spiral of poverty, violence,

and fear.

A Patchwork Future

The foregoing scenarios are clusters of

likelihood designed to stimulate our

imagination. They do not exhaust all the possibilities in our future. Just as the world today

simultaneously evinces integration and fragmentation, so too may we expect that future

trends will combine to produce a patchwork of

consequences rather than any single, logically

coherent whole. 

The Democratic Peace is the world 

could exist for those states where today dem

racy has firm roots and where econo

policies are based on market principles. It m

be that certain parts within that domain e

move into the world of Globalizat

Triumphant. States in these domains w

continue to have differences, and some seri

threats will remain. But these will be amena

to peaceful resolution. The prospects for m

interstate war would be small.

But a more pessimistic future is a

possible for democratic, free-market states, 

it is more likely for the rest of human

Societies and governments will find themsel

torn between new opportunities and old hab

Particularly critical will be what happens o

the next quarter century in major countries s

as Russia, China, India, Indonesia, 

Philippines, Vietnam, North Korea, Malay

Thailand, Egypt, Iran, Turkey, Pakis

Mexico, Brazil, South Africa, and Nige

These states could find themselves in regi

characterized by the world of Nationalism 

Protectionism or even by the world of Divis

and Mayhem. The prospect for major inters

war in these domains would be large.

In short, all four scenarios would play 

but in parts. Taken together, the world in 

coming 25 years would be regionalized, no

economic terms, but in terms of overarch

performance.

Perhaps what matters most will be 

world’s elemental trajectory. Toda

world is divided more or less between a zon

democratic peace and a zone of chronic trou

Will many members of the former world 

away into the latter, or will many member

the latter find their way into the former? A

what will be the relationship between the p

of such a divided world? Can a zone of pr
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

perity and relative tranquility remain isolated

from the pain, the heartbreak, the refugees, and

possibly the diseases of the zone of hardship

and turmoil? Answers to all of these questions

cannot be known with certainty. They will

depend importantly on the policies and strategies to be adopted by countries around 

world. The role that the United States will p

will be critical as well. But here we must s

for that is the subject of this Commissio

Phase II Report.
U.S. Commission on National Security/21st Century 

138 NEW WORLD COMING

V: Major Themes and

Implications 

The foregoing analysis leads us to the

following general conclusions about

the world that is now emerging, and the

American role in it for the next 25 years.

1. America will become increasingly vulnerable to hostile attack on our

homeland, and our military superiority

will not entirely protect us.

The United States will be both absolutely and

relatively stronger than any other state or combination of states. Although a global competitor

to the United States is unlikely to arise over the

next 25 years, emerging powers—either singly

or in coalition—will increasingly constrain

U.S. options regionally and limit its strategic

influence. As a result, we will remain limited

in our ability to impose our will, and we will be

vulnerable to an increasing range of threats

against American forces and citizens overseas

as well as at home. American influence will increasingly be both embraced and resented

abroad, as U.S. cultural, economic, and political power persists and perhaps spreads. States,

terrorists, and other disaffected groups will

acquire weapons of mass destruction and mass

disruption, and some will use them. Americans

will likely die on American soil, possibly in

large numbers.

2. Rapid advances in information and

biotechnologies will create new vulnerabilities for U.S. security.

Governments or groups hostile to the United

States and its interests will gain access to

advanced technologies. They will seek to

counter U.S. military advantages through the

possession of these technologies and their

actual use in non-traditional attacks. Moreo

as our society becomes increasingly depend

on knowledge-based technology for produc

goods and providing services, new vulnerab

ties to such attacks will arise. 

3. New technologies will divide the world 

well as draw it together.

In the next century people around the world 

both developed and developing countries 

be able to communicate with each other alm

instantaneously. New technologies w

increase productivity and create a transnatio

cyberclass of people. We will see much gre

mobility and emigration among educated el

from less to more developed societies. We 

be increasingly deluged by information, 

have less time to process and interpret it. 

will learn to cure illnesses, prolong and enr

life, and routinely clone it, but at the same ti

advances in bio-technology will create m

dilemmas. An anti-technology backlash 

possible, and even likely, as the adoption 

emerging technologies creates new mo

cultural, and economic divisions.

4. The national security of all advan

states will be increasingly affected by 

vulnerabilities of the evolving glo

economic infrastructure. 

The economic future will be more difficul

predict and to manage. The emergence 

strengthening of significant global econo

actors will cause realignments of econo

power. Global changes in the next quar

century will produce opportunities 

vulnerabilities. Overall global econo

growth will continue, albeit unevenly. At 

same time, economic integration and fragm

tation will co-exist. Serious and unexpec

economic downturns, major disparities 

wealth, volatile capital flows, increasing v
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

nerabilities in global electronic infrastructures,

labor and social disruptions, and pressures for

increased protectionism will also occur. Many

countries will be simultaneously more wealthy

and more insecure. Some societies will find it

difficult to develop the human capital and

social cohesion necessary to employ new technologies productively. Their frustrations will be

endemic and sometimes dangerous. For most

advanced states, major threats to national

security will broaden beyond the purely

military.

5. Energy will continue to have major

strategic significance.

Although energy distribution and consumption

patterns will shift, we are unlikely to see

dramatic changes in energy technology on a

world scale in the next quarter century.

Demand for fossil fuel will increase as major

developing economies grow, increasing most

rapidly in Asia. American dependence on

foreign sources of energy will also grow over

the next two decades. In the absence of events

that alter significantly the price of oil, the stability of the world oil market will continue to

depend on an uninterrupted supply of oil from

the Persian Gulf, and the location of all key

fossil fuels deposits will retain geopolitical significance.

6. All borders will be more porous; some

will bend and some will break.

New technologies will continue to stretch and

strain all existing borders—physical and social.

Citizens will communicate with and form allegiances to individuals or movements anywhere

in the world. Traditional bonds between states

and their citizens can no longer be taken for

granted, even in the United States. Many countries will have difficulties keeping dangers out

of their territories, but their governments will

still be committed to upholding the integrity 

their borders. Global connectivity will al

"big ideas" to spread quickly around the glo

Some ideas may be religious in nature, so

populist, some devoted to democracy 

human rights. Whatever their content, the st

will be set for mass action to have social imp

beyond the borders and control of existing 

litical structures.

7. The sovereignty of states will co

under pressure, but will endure.

The international system will wrestle const

ly over the next quarter century to establish 

proper balance between fealty to the state 

the one hand, and the impetus to build effec

transnational institutions on the other. T

struggle will be played out in the debate o

international institutions to regulate finan

markets, international policing and pea

making agencies, as well as several ot

shared global problems. Nevertheless, glo

forces, especially economic ones, will conti

to batter the concept of national sovereig

The state, as we know it, will also face ch

lenges to its sovereignty under the mandate 

evolving international law and by disaffec

groups, including terrorists and crimin

Nonetheless, the principle of national sov

eignty will endure, albeit in changed forms

8. Fragmentation or failure of states 

occur, with destabilizing effects 

neighboring states. 

Global and regional dynamics will norm

bind states together, but events in major co

tries will still drive whether the world 

peaceful or violent. States will differ in t

ability to seize technological and economic 

portunities, establish the social and polit

infrastructure necessary for economic grow

build political institutions responsive to the 
U.S. Commission on National Security/21st Century 

140 NEW WORLD COMING

pirations of its citizens, and find the leadership

necessary to guide them through an era of uncertainty and risk. Some important states may

not be able to manage these challenges and

could fragment or fail. The result will be an

increase in the rise of suppressed nationalisms,

ethnic or religious violence, humanitarian disasters, major catalytic regional crises, and the

spread of dangerous weapons.

9. Foreign crises will be replete with atrocities and the deliberate terrorizing of

civilian populations.

Interstate wars will occur over the next 25 years,

but most violence will erupt from conflicts

internal to current territorial states. As the desire

for self-determination spreads, and many governments fail to adapt to new economic and

social realities, minorities will be less likely to

tolerate bad or prejudicial government. In consequence, the number of new states, international

protectorates, and zones of autonomy will

increase, and many will be born in violence. The

major powers will struggle to devise an accountable and effective institutional response to such

crises.

10. Space will become a critical and competitive military environment.

The U.S. use of space for military purposes will

expand, but other countries will also learn to

exploit space for both commercial and military

purposes. Many other countries will learn to

launch satellites to communicate and spy.

Weapons will likely be put in space. Space will

also become permanently manned.

11. The essence of war will not change. 

Despite the proliferation of highly sophisticated and remote means of attack, the essence of

war will remain the same. There will be casualties, carnage, and death; it will not be lik

video game. What will change will be 

kinds of actors and the weapons available 

them. While some societies will attempt 

limit violence and damage, others will seek 

maximize them, particularly against those s

eties with a lower tolerance for casualties.

12. U.S. intelligence will face more challe

ing adversaries, and even excell

intelligence will not prevent all surpri

Micro-sensors and electronic communicati

will continue to expand intelligence collec

capabilities around the world. As a result of 

proliferation of other technologies, howe

many countries and disaffected groups 

develop techniques of denial and deception 

an attempt to thwart U.S. intelligence effort

despite U.S. technological superiority. In 

event, the United States will continue 

confront strategic shocks, as intellige

analysis and human judgments will fail 

detect all dangers in an ever-changing worl

13. The United States will be called up

frequently to intervene militarily in 

time of uncertain alliances and with 

prospect of fewer forward-deplo

forces. 

Political changes abroad, economic consid

tions, and the increased vulnerability of U

bases around the world will increase pressu

on the United States to reduce substantially 

forward military presence in Europe and A

In dealing with security crises, the 21st cent

will be characterized more by episodic "pos

of the willing" than the traditional World W

II-style alliance systems. The United States 

increasingly find itself wishing to form co

tions but increasingly unable to find partn

willing and able to carry out combined mili

operations.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

14. The emerging security environment in

the next quarter century will require different military and other national

capabilities.

The United States must act together with its

allies to shape the future of the international environment, using all the instruments of

American diplomatic, economic, and military

power. The type of conflict in which this

country will generally engage in the first

quarter of the 21st century will require sustainable military capabilities characterized by

stealth, speed, range, unprecedented accuracy,

lethality, strategic mobility, superior intelligence, and the overall will and ability to

prevail. It is essential to maintain U.S. technological superiority, despite the unavoidable

tension between acquisition of advanced capabilities and the maintenance of current

capabilities. The mix and effectiveness of

overall American capabilities need to be

rethought and adjusted, and substantial changes

in non-military national capabilities will also

be needed. Discriminating and hard choices

will be required. 

I

n many respects, the world ahead seems

amenable to basic American interests

and values. As to interests, the spread of knowledge, the development of new technologies,

and the expansion of global cooperation will

present vast opportunities for economic growth

and the rise of political liberalism. The size of

the world’s middle class may increase many

times over, lifting literally tens of millions of

people from the depredations of poverty and

disease. Authoritarian regimes will founder as

they try to insulate their populations from a

world brimming with free-flowing information.

We may thus bear witness to the rise of new

democracies and the strengthening of older

ones. Taken together, these developments could

reduce sharply the prospects for violent

conflict, and augur for a more peaceful wo

All of that is very much in the Ameri

interest and provides real opportunities for 

United States in the future. 

As to values, a world opened up by the 

formation revolution is a world less hospita

to tyranny and friendlier to liberty. A 

socially rigid, freer, and self-regulating wo

may also be in prospect, a joint result of 

anti-hierarchical implications of the informa

revolution and the post-Cold War normative 

toward representative government. If so, suc

world would accord with our deepest polit

beliefs and our central political metaphor—

of the dynamic equilibrium— which finds 

pression in the “invisible hand” of the mar

our social ideal of E Pluribus Unum, the che

and balances of our Constitution, and in 

concept of federalism itself.

Nevertheless, a world amenable to Ameri

interests and values will not come into being 

itself. Much of the world holds different inter

and values. They also resent and oppose us 

the simple fact of our preeminence, and beca

they often perceive the United States as exer

ing its power with arrogance and self-absorpt

There will also be much apprehension and c

fusion as the world changes. Fragmentation 

integration will proceed simultaneously at dif

ent levels, as will centralization 

de-centralization. Our vocabularies will fail u

old boundaries blur: between homeland defe

and foreign policy; between sovereign states 

a spectrum of protectorates and autonom

zones; between virtual and literal communitie

All of this suggests that threats to Ameri

security will be more diffuse and harder to 

ticipate than ever before. While the likelih

of major conflicts between powerful states 

decrease, conflict itself will likely change 

character and increase in frequency. Deterre
U.S. Commission on National Security/21st Century 

142 NEW WORLD COMING

will not work as it once did. In many cases it

may not work at all. 

In navigating the new world, the United

States will need to find a proper balance

between activism and self-restraint. No power,

no matter how strong, will be able to manage or

control international politics. American pragmatism and historic optimism have their limits.

To overreach is to fall prey to hubris, and if we

seek to exercise control over events beyond

what reality can bear, we will end in frustration,

recrimination, and ruin. 

But humility is not a prescription for policy

passivity. If we are agile in the new century that

stands before us, change will be our ally. It

makes sense for the United States to bias the strategic environment in its favor to the extent

possible and prudent, and to try harder to

prevent conflict so that there will be less n

for diplomatic triage after the fact. A g

nation that does not try to influence the fu

may end up as its victim. That will be as 

for the next 25 years as it has been for at l

the last 2,500.

The world that lies in store for us over 

next quarter century will surely challe

received wisdom about how to pro

American interests and advance Ameri

values. In such an environment, the Un

States needs a sure understanding of its obj

tives, and a coherent strategy to deal with b

the dangers and the opportunities ahead. I

from this Phase I Report that the U

Commission on National Security/21st Cent

will develop that understanding, and build 

strategy. We do so from what we believe 

firm foundation.
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

Richard Haass

Keith Hahn

John Hillen

Frank Hoffman

Robert Killebrew 

Richard Kohn

Bill Lewis

Martin Libicki 

Jim Locher

Charles Moskos

Williamson Murray

Barry Posen

Peter Rodman

Barbara Samuels

Kori Schake

James Thomason 

Ruth Wedgwood

Research Associates 

Mark Burles

Erin Conato

Chris Dishman

William Foster

Christopher Hall

Kelly Lieberman

William Lippert

Geoffrey Megargee

Philip Ritcheson

Kathleen Robertson

Rachel Schiller

Betsy Schmid

Support Staff

Marilyn Bridgette, Administrative Officer

Elizabeth Ellingboe, Travel Coordinator 

Jamie Finley, Executive Assistant to 

Executive Director

Marvin Goodwin, Contract Administrator

John Gardner, Information Management Special

James Harris, Budget Manager 

Michele Hutchins, Administrative Specialist

Donald Kinder, Supply Specialist 

Diane Long, Commissioner Liaison

Jonathan Nemceff, Director, Information 

Management 

Tom Prudhomme, Security Manager

Cynthia Waters, Study Group Liaison

Co-Chairs

Gary Hart

Warren Rudman

Commissioners

Anne Armstrong

Norm Augustine

John Dancy

John Galvin

Leslie Gelb

Newt Gingrich

Lee Hamilton

Lionel Olmer

Donald Rice

James Schlesinger

Harry Train

Andrew Young

Executive Director

Charles G. Boyd

Deputy Executive Director

Arnold Punaro

Chief-of-Staff

Hank Scharpenberg 

Study Group Director–Phase One

Lynn Davis

Study Group Coordinator

Pat Allen Pentland

Study Group Members

Patti Antsen 

Lyntis Beard 

Jeff Bergner 

Coit Blacker

Barry Blechman

Chris Bowie

Ivo Daalder

Jacquelyn Davis

Rhett Dawson

Keith Dunn

Charles Freeman

Adam Garfinkle

Commission and Study Group Staff Roster

U.S. Commission on National Security/21st Century 
U.S. Commission on National Security/21st Century 

144 NEW WORLD COMING

Many U.S. government agencies assisted in

Phase One of the study. Within the Department

of Defense, we especially note the Office of the

Secretary of Defense staff to include organizations in the Under Secretary of Defense for

Policy, the Joint Staff, especially J5, and all

Service staffs; the Defense Intelligence

Agency; National Defense University and the

Institute for National Strategic Studies; the

Army War College; Joint Theater Air and

Missile Defense Organization; and the Defense

Information Security Agency. Department of

Defense assistance was also received from:

U.S. European Command; U.S. Pacific

Command; U.S. Atlantic Command; U.S.

Central Command; U.S. Southern Command;

U.S. Space Command; U.S. Strategic

Command; U.S. Special Operations Command;

U.S. Transportation Command; U.S. Forces

Korea; the U.S. Mission to the North Atlantic

Treaty Organization; the George C. Marshal

European Center for Security Studies; the AsiaPacific Center; and the Center of Excellence in

Disaster Management and Humanitarian

Assistance. 

The Department of State provided support

for the many regional workshops and assisted

with trip itineraries and clearances for the

Commission’s foreign travel. The Commission’s

international trips depended on critical assistance from the American embassies, consulates,

institutes, missions, and country teams at the following locations: Hong Kong, Shanghai,

Beijing, Taipei, Seoul, Tokyo, London, Paris,

Geneva, Rome, Bonn, Berlin, Brussels, Kiev,

Moscow, Ankara, Istanbul, Tel Aviv, Cairo,

Baku, Tbilisi, Islamabad, Lahore, New Delhi,

Bangalore, Singapore, and Jakarta.

The Department of Justice and the Fed

Bureau of Investigation assisted with sev

workshops, as did the Department of 

Treasury. Other government agencies w

assisted with the work of this commiss

included: the National Security Council; 

Central Intelligence Agency and the Natio

Intelligence Council; the National Secu

Agency; the National Reconnaissance Off

the U.S. Coast Guard; the National Institute

Health; the Center for Disease Control; 

Office of National Drug Control Policy; 

Office of Emergency Preparedness; and 

Critical Infrastructure Assurance Office.

Foreign government ministries and mi

ters, as well as opposition parties 

non-governmental organizations and busin

leaders, were also crucial in providing input

the Commission. We especially note those fr

the United Kingdom, France, Italy, Germ

Belgium, the Russian Federation, Ukraine, 

People’s Republic of China, Taiwan, So

Korea, Japan, Turkey, Georgia, Azerbaij

Israel, Egypt, Pakistan, India, Singapore, 

Indonesia. Other officials from the Wes

European Union, the North Atlantic Tre

Organization, the United Nations H

Commission for Refugees, and the Internatio

Committee of the Red Cross also provided as

tance.

The Commission and Staff worked w

many non-profit organizations, corporatio

and public policy institutions. These inclu

the International Institute for Strategic Stud

the Woodrow Wilson Center; the Nixon Cen

the Brookings Institution; RAND; the Ce

for Naval Analyses; the Institute for Defe

Analyses; the Center for Strategic 

International Studies; the Center for Strate

Acknowledgements

Commission and Study Group Staff Roster
SUPPORTING RESEARCH AND ANALYSIS 

U.S. Commission on National Security/21st Century 

and Budgetary Assessments; the Carnegie

Corporation; the National Institute for Public

Policy; the CATO Institute; the Center for

Defense Information; Toffler Associates;

Science Applications International Corporation;

Global Business Network; DFI International;

Lockheed-Martin Corporation; the World Bank;

the International Monetary Fund; Organisation

for Economic Co-operation and Development;

Standard and Poors’ DRI Group; Wharton

Economic Forecasting Associates; the National

Guard Association; the East-West Center; and

the International Foundation for Election

Systems.

The Commission met with many individuals from governments as well as public and

private organizations in the United States and

overseas in the course of workshops, seminars,

and interviews. Others assisted the Commission

with itineraries and contacts, and count

others provided information, made prese

tions, or reviewed draft papers. 

Thousands of people in this country 

around the world have also assisted us over 

interactive website. Since the site opened to 

world in March 1999, it has been “hit” o

700,000 times. We have also received m

than 400 archived substantive comments fr

all over the country and some from outside 

country as well. The “Future Tech Forum” 

especially helpful in generating sources of 

formation for this report. This is the first t

that any U.S. national commission has de

oped a means of communicating interactiv

with the American public-at-large during 

active research phase of a study. The web

will remain open and operating for the dura

of the Commission’s work at www.nssg.gov
U.S. Commission on National Security/21st Century 

146 NEW WORLD COMING