Stratfor’s envisioned coming decade. – Blog No. 31.



When in my previous blog, I came to summarise the contents of the Stratfor (‘the Shadow CIA’) vision of the next ten years of global developments in international relations, I was more than surprised. Stratfor’s five yearly analyses are highly respected and are influential opinion formers in helping to set the foreign policy of the USA. I had therefore expected something considerably more comprehensive, more cautious in its insights and considerably less like a partisan prescription for future US foreign policy.

The omissions from Stratfor’s forecast were as startling as some of the developments it envisioned. In a document claiming to be able to give its subscribers advance notice of the most significant global developments in international relations over the coming ten years, the visionaries were beset with multiple and quite unexpected blind-spots.

There was no mention of climate change; no mention of events pertaining to the Southern Hemisphere; in the northern hemisphere there was no mention of the Indian sub-continent (with its 22% of the global population;) no mention of the UN; no mention of Israel; (indeed, with the world’s doomsday clock put forward just two months ago, from five minutes, to three minutes to midnight, four of the world’s nine nuclear-armed powers, Pakistan, India , North Korea and Israel, were totally ignored.) No mention was made of the development of the Internet or of the fast developing capacity of nations to wage cyber warfare. No mention was made of any challenges to the US dollar as the global reserve currency, or of any potential major upsets to the global banking system; no mention of the Shanghai Cooperation Organisation (SCO) which is a developing international organisation that looks set to subsume at least fifty percent of humanity. BRICS and the EEC (Eurasian Economic Community) also fail to register (though their omission is probably justified by the foreseen disappearance of Russia, which would be fatal to the EEC – though hardly to BRICS.) Instead, a whole section is devoted to the Stratfor identified, sixteen or so minor nations, set collectively to usurp China’s position as a low-cost manufacturer – possibly a heads-up investment tip designed to appeal to Stratfor’s corporate readership.

I certainly am no prophet and have nothing approaching the degree of information and analytical talent to be able to forecast world events ten years out. However, I do feel qualified to point out some potential developments that do not accord with those foreseen by Stratfor.

In my opinion, Stratfor’s forecasting suffers from two major failings. The first is good old wishful thinking, founded on a gut-felt American patriotism. The second is a methodological failing. In Stratfor’s opinion, the actions of nations are governed primarily by geographic factors. No nation can escape the tyranny of its geographic circumstances. It is this, more than anything else, which imprisons the world’s leaders in separate rooms, each offering relatively few policy options.

Using this analytical template, I have tried to fit it to some of the forecasts made. It doesn’t seem to work. For instance, on the one hand we have the claim that the USA, with its new-found fossil fuel abundance, is now virtually self-sufficient. Its dependence on exports and imports (other than foreign capital in flight from crises overseas) is insignificant, when compared to those of other nations. Furthermore, the USA is geographically isolated and faced with no military threats from its own landmass.

So what geographical imperative is it that is forcing the USA to attempt the destabilisation of Russia and run the gauntlet of a nuclear war? A similar question might have been asked about the War on Terror – why was it necessary to engineer excuses to overthrow Saddam Hussein’s regime, when the USA’s leadership was fully aware that Saddam was not in alliance with al Qaeda, did not possess WMD and posed no possible threat to homeland America? If it were simply a question of access to oil, Saddam would have gladly sold it to them at a political and monetary cost far less than that of an invasion and occupation.

The answer in all the above instances, is that ideological preference, be it religious enthusiasm, political enthusiasm, or simply cash, has trumped geographic necessity. It could be argued that the American world dominationsystem’s vulnerability to Neo-con policies, based on a belief in American exceptionalism and its destiny of unchallenged global domination (with the best interests of the rest of humanity not necessarily at heart) is a consequence of the vast wealth accumulated by a tiny percentage of their population. There is a practical aspect to this lust for power. American economic and military dominance is not only an end in itself, but also a tool with which to extract ever greater wealth out of the rest of the world’s population.

It would be possible to make a case that the accumulation of wealth by the American oligarchy was made possible by the serendipitous placement of American geographical advantages – such as the navigability of the Mississippi. However, it would be a very long stretch from that argument to claim that American foreign policy in regard to Israeli plans for the Middle East, or to furthering the break-up of the Russian Federation, was the inevitable consequence of any geographical dilemma facing America’s political leaders.

In the world-view set out in the Stratfor document, the primary influence on future events is the actions or inactions of the USA. One has to be grateful that the opinions and prejudices of third parties will also affect the outcomes. Ever since the Marshall Plan and the post-WWII resuscitation of Europe and Japan, it is hard to find American foreign policy interventions that can be deemed categorically, to have bettered the lot of humanity. (The list of interventions that have had the opposite effect would include Korea; Cuba; Vietnam; Iraq; Afghanistan: Libya, Somalia, Syria; the creation of Israel; and many more besides –taking Yemen as the most recent.)

Taking the Stratfor forecast prophesy by prophesy we have:

The descent of the EU into irrelevance: The Stratfor analysis on this count seems perfectly realistic. The EU was misconceived from the outset. With the initial members all holding back on relinquishing the key aspects of their sovereignty, the EU venture’s leadership was entrusted to bureaucrats, with an instinctive desire to widen their mandate. Whereas a responsible leadership would have viewed the possible expansion of membership strategically, in the light of compatibilities and long-term stability, the bureaucrats expanded on a piece-meal tactical basis and have ended up with the proverbial camel – a horse designed by a committee. The idea might have worked on Anthony Sampson’s original proposal in his ‘Anatomy of Europe,’ of an EU composed of provinces (Wessex; Saxony; Piedmont: Burgundy etc.) as opposed to existing sovereign states, but now the centrifugal forces of national sovereignties, under economic pressure caused by the incompatibility of national objectives, will likely cause it all to splinter, or at least for the bonds holding it together to significantly weaken.

The resurgence (with active US assistance) of Polish and Turkish economic and military power at the territorial expense of Russia and as Germany’s economic decline gathers pace. It would indeed be surprising if this vision came to pass. Germany’s foreseen decline is based on an aging population and the fact that its southern EU export market, on which the export of up to german logos25% of its GDP is dependent, is falling apart. Even if Germany has to switch to other destinations for its exports, it is difficult to see exactly how Poland is going to come up from behind and overtake it. Currently Germany has a population of 83 million with average per capita GDP of US$46,000, whereas Poland has a population of 39 million with an average per capita GDP of US$13,600. No matter how much encouragement is given by the USA, how is Poland going to outstrip Germany within ten years? This is how The Economist rates Polish Industrial strength – not in the same league.

On top of this, as the EU loses cohesion, German business will be looking for new markets and where better to go than eastwards, through Russia to China? Germany already accounts for over half of all EU exports to China. Even if its political leadership still struggles to come to terms with the implications, the board rooms of such as Siemens, BASF, BMW and Deutsche Bank are already fully aware of the potential offered by a proposed silk road, fast rail, connection between Beijing and Berlin. (There is even a proposal on the table for a road route from London via Berlin and Moscow to New York, running alongside the Trans-Siberian Railway and via a tunnel or series of bridges under or over the Bering Strait and into Alaska.)

When needs must, it is unlikely that Poland, even with US backing, will be able to block German pursuit of its urgent national interest, which will entail a mutually beneficial collaboration with Russia.

This blog will become too long if I go into the reasons why Stratfor’s forecast of Turkish military and political expansion into both the Black Sea and the European countries that used to be part of the Ottoman Empire is unlikely to be realised.


Retreat from Russia

The collapse and fragmentation of Russia. This gives opportunity to the former Eastern Bloc countries and Finland in the West and, in the East, Japan and China, to feed off the severed limbs. Russia has governed its current territories for several centuries. What is going to happen in the next ten years that will place Russia under greater pressure to abandon them than that endured in the past? It certainly won’t be an invasion from Poland or Turkey.

No doubt the Washington think-tanks are dreaming of a classic, colour revolutionary subversion along the lines of Ukraine or Georgia – and here is the textbook on how it should be arranged

The Americans repeatedly suffer from a failure to understand cultures other than their own. The Vietnamese did not react to being bombed as McNamara thought Ford Motor employees in the US might have reacted to similar harassment. The Russian are far too patriotic to allow blatant American subversion to overturn their government. If they were prepared to die in the millions under a Stalin to defeat Hitler, under a Putin, no matter how much they might object to his government (his current approval rating is around 80%) they are most unlikely to surrender their country to minority groups supporting the American way.

In their defence against subversion and economic attack they will have the full support of the Chinese government and its economic strength. American hostility to Chinese independence has been made all too clear. Not only does Beijing regard the survival of a friendly regime in Moscow as a first line of defence against hostile American intentions, it is also the guarantee of endless raw materials, free from all risk of American naval interdiction.

If subversion is unsuccessful, there is always the danger that adherents to the Neo-con ideology could drag the world into a more muscular attempt on Russia. An insight into their thinking and their willingness to distort the truth and adopt high-risk strategies in their determination to engineer regime change in Russia, is the recent resolution of the Neo-con controlled Congress – House Resolution 162 It passed on 23rd March. 348 voted for – 48 against.

Happily, such resolutions are unenforceable without Presidential approval. Passing such resolutions in Congress does little more than to confirm to Russia that it is under attack and needs to heighten its defences. No matter how much huffing and puffing goes on in Congress, it is still hard to see how the Neo-cons will succeed in blowing down the Russian house without resorting to a nuclear war that would leave their own, and everyone else’s’ houses uninhabitable.

• The increase in Japanese naval might outstripping that of China. One of the reasons Stratfor gives for Germany’s impending decline, is the aging and decline of its population. The demographics in Japan are far more critical. The population is expected to fall by 25% over the next 35 years and, in contrast to Germany, Japan has no cultural ability to assimilate immigrants in the numbers required for replenishment. By 2050 the Japanese population will stand at approx. 95 million against China’s approx. 1.4 billion. Given the demographics, it is hard to envisage an island Japan having the vigour to compete successfully with China, should it ever come to a showdown over a possible grab for the eastern provinces of a disintegrating Russian Federation.

As far as building naval power, both Japan and China have interests in defending the same sea-lanes and at some point, were American urgings to be removed, collaboration, rather than competition between the two economies and their respective navies, could make sense to both leaderships.

China’s withdrawal into modest economic growth and a stronger, centralised communist dictatorship to contain internal dissent and the distant possibility of civil war. (A sense of déjà vu: Stratfor’s 1996-2005 forecast for China was for “growing instability, including the strong possibility of fragmentation and civil war.”)

China growthIt seems to me that this forecast is unjustifiably complacent from the viewpoint of a would-be American master of the Universe. It is certainly true that China’s growth rate is slowing as it consciously moves over from a fast growth economy, based on cheap exports, to a steady growth economy based on domestic consumption. There is certainly room for continued growth and expansion in domestic consumption, with the benefits of the export boom period having been unequally distributed between the prosperous coastal areas and the more westerly provinces.

Currently China, at US$12,000 rates only 85 in the World Bank’s ranking of average per capita GDP. (The USA’s is $53,000.) However, in 2000 average per capita GDP in China was less than US$4000. In fifteen years the Chinese government has overseen the per capita GDP of its billion plus citizens rise by an average of $8000! At an admittedly still slowing 7.7% per annum growth (against the USA’s 2.2%) China’s looks like an exceptionally strong economy which, as was the case with Singapore, has a strong, forward planning and prudent leadership. That leadership is actively and successfully engaged in global economic development with a view to securing its routes to export markets and its supplies of commodities. In marked contrast to the USA, it is doing this in such a way as to minimise foreign hostility or opposition to the achievement of its goals. Thereby, in contrast to the USA’s vast expenditure on offensive military capacity, China keep’s the constant economic drain of military expenditure down to a minimum consistent with home-defence.

With a country of such vast numbers and size, things can certainly go wrong. The leadership is already grappling with the evolutionary changes to political institutions that will be required to meet the needs of rapidly changing economic circumstances. There are signs of American attempts to nibble at the edges of Chinese power. Its NGO’s having supported the ‘umbrella protests’ in Hong Kong and there are repeated rumours of the Uyghur Moslem unrest in the western province of Xingjian receiving support through other Islamic terrorist and insurgent groups with connections to US Intelligence agencies. However, these are only feeble meddlings and despite Stratfor’s fond imaginings, in light of continuing economic growth, the power of the Internet, enormous expenditure on developing internal infrastructure and of armed forces, from which emerge no hints of disloyalty, it would be silly to base a foreign policy on anticipation of a break-down in Chinese Communist Party control. As an indicator of the direction in which China is moving, this report came into my computer just as I was writing this section.

To summarise, the Chinese economy would seem to have much further to run that Stratfor indicates, though I believe Stratfor to be right in one aspect of its forecast. If the Chinese model of one party dictatorship fails to become more pluralistic and fails to allow greater freedom of information flows than its current control over media and internet permit, there will be significant constraints on its ultimate ability to grow its economy. Increasing social pressures could lead it into a viscous downward spiral of political repression which in turn would dampen economic initiative. However, barring a massive global economic collapse, it seems unlikely that these constraints on China will prove insurmountable over the period covered by Stratfor’s forecast.

The war on terror, marked by the continued break up and failure of Middle Eastern states, to continue on a somewhat lower key. No reason is given why, while it was once so important to the USA, insurrection in the Moslem World can now have its priority reduced and it can be left for Turkey, Iran and Saudi Arabia to contain. Perhaps a significant factor is America’s greatly decreased dependence on Middle Eastern oil. Another factor is that now that western interventions have set in process the break-up of neighbouring countries that might have challenged Israel, Israel can be viewed as well able to look after itself without further US intervention.

Admittedly, Turkey and Iran are still left standing, but Turkey is required as a team-player against Russia and perhaps America has realised that Iran, even had it not had its economic development severely curtailed by the sanctions imposed on it, never had any intention of acquiring nuclear weapons or of posing an existential threat to Israel. Nor has it ever had any intention of posing a terrorist threat to homeland America. Indeed the terrorists that threaten America, are the same that threaten Iran. It has to be apparent to even mildly sensible US policy formulators, that the Iranians are the USA’s natural allies in the war on terror – now renamed ‘the Long War.’

Not mentioned by Stratfor is the agreement with Saudi Arabia that Saudi will support the petrodollar while the USA ensures the perpetuity of the House of Saud’s seat on its throne. To protect the status of the dollar, the US retreat from involvement with Middle East politics might be harder than Stratfor anticipates. Already, as the US moves to leave Iran as a guardian of the regional balance of power, we see the US being dragged into a new conflict in the Yemen designed to show support for Saudi Arabia in its moves to limit Iranian power. To preserve the balance, the US will find itself having to intervene on all sides and thus find itself in conflict with itself!

In the meantime, as the world’s last super-power left standing, a serene USA moves from strength to strength economically and can leave much of the world’s troubles to be dealt to by lesser powers. This is a remarkable position to be held by a nation with less than 5% of the love americaglobal population. According to Stratfor, the only area in which the USA will not be withdrawing to the side-lines is in its supervision of the break-up of the Russian Federation and if need be, a possible militarily intervention to prevent the Russian nuclear arsenal falling into the wrong hands.

The only cloud on the USA’s horizon is the decline of its middle class, which might cause internal dissent towards the end of the decade. With just 1% of its population controlling more than 35% of the nation’s wealth, it could well be that the political situation becomes more turbulent. There is a viscous circle at work. As an oligarchy entraps an increasing proportion of a nation’s wealth, that wealth can be used to adjust the political rules to accelerate the process. Given the Iron Law of Oligarchy, It is unlikely that the middle class will return. Wealth inequality in the USA may well have now past the point of no return and the middle class will continue its decline, while the hyper-rich increase their influence – and wealth. However, the modern surveillance and security state and the media’s effective manipulation of public opinion should prevent any breakdown of social control. The American state will have no difficulty in controlling any internal dissent that might develop.

An utterly scary interview between two well-informed members of the blogosphere on the subject of Neo-con influence in the USA (of which Stratfor is a significant component) can be read here. It is not at all a comforting piece. and Craig-Roberts’ bio:

Clearly, US foreign policy, in its willingness to undermine Russian constitutional and territorial integrity, has been adopting policies of increasing risk. It has led me to look further into theories of risk management. The quote below refers to the stock market, but is equally applicable to any form of risk taking.


“The principle that potential return rises with an increase in risk. Low levels of uncertainty (low-risk) are associated with low potential returns, whereas high levels of uncertainty (high-risk) are associated with high potential returns. According to the risk-return trade-off, invested money can render higher profits only if it is subject to the possibility of being lost.

Because of the risk-return trade-off, you must be aware of your personal risk tolerance when choosing investments for your portfolio. Taking on some risk is the price of achieving returns; therefore, if you want to make money, you can’t cut out all risk. The goal instead is to find an appropriate balance – one that generates some profit, but still allows you to sleep at night.”

In light of the above, what is the risk equation being described (if not actually advocated) by Stratfor? At increasing risk, is the worst case scenario of thermo-nuclear exchanges between the super-powers, which could result in the end of mammalian life on Earth. Given the extent of the risk, what is the potential return for the risk-takers? Given that the USA’s population represents approx. 5% of Humankind, of which the rich elite, actively involved in the making of foreign policy, compose less than 1%, we have 0.005% of humanity deciding on the degree of risk they are prepared to take (and which the rest of humanity will have to accept.) Their potential ‘win’ is that they should gain a position of unchallenged dominance over the world economy. Whether the US foreign policy elite, wins or loses, it is a gamble that cannot pay off for the rest of humanity.


Congress’s chickens come home to roost.

The question is whether the benefit the elite see themselves in line for, justifies the risk to their own lives: are they happy “to sleep at night,” while laying those stakes on the table? If they are, I would suggest they are dangerous lunatics and that the rest of humanity needs to come to its senses and    confine them in an asylum until their mental equilibrium is restored and they re-join the Human race.

Most remarkably, two days before Easter, Stratfor has posted a report, which to my best recall is unprecedented in its dove-like argument entitled ‘Backtracking from the brink in Ukraine.’ In it, Stratfor argues, much to its credit, that the western media has become unduly hysterical in its demonization of Putin. As a consequence, the Western alliance’s views of the situation are in danger of becoming so unbalanced as to lead to an unnecessary degree of risk of military confrontation. Has Stratfor scared itself with its own forecast?

Whereas many of Stratfor’s foreseen changes are unlikely to come about, there are others of equal or greater potential significance, which almost certainly will take place, but which Stratfor has failed to discuss. First of these is the salient issue facing humanity and all terrestrial life – rapid climate change. I cannot believe that Stratfor, like so many Americans, is still in denial of this phenomenon?

All the above forecasting and debate is based on the assumption that the global economy will continue along its current course with only gradual change. Though the subject remains untouched by Stratfor’s forecast, there are plenty of indicators that abrupt disruptions are a distinct possibility. One such forecast: of the global economy’s sudden tipping over the edge of a long and exceptionally deep depression will the subject of another blog.

I usually try and have a couple of blog posts in the pipeline so I can guarantee a release every Sunday. This commentary on Stratfor’s forecast has been on the chocks for at least a week and in the interim, the news from the Middle East is one of sharp deterioration. Senator McCain, influential leader of the Senate Armed Service Committee, is openly advocating that Israel, which is now supporting Saudi Arabia in its assault on the Yemen, should bomb Iran. “The Israelis will need to chart their own path of resistance. On the Iranian nuclear deal, they may have to go rogue. Let’s hope their warnings have not been mere bluffs. Israel survived its first 19 years without meaningful U.S. patronage. For now, all it has to do, is get through the next 22, admittedly long, months.”

Even though in the past few hours, the Iranians, the US and the other powers involved, have reached an agreement to limit Iran’s use of nuclear technology and let Iran re-enter the global economy, it is quite possible that the agreement will not survive beyond the election of the next Republican President to the White House. Nevertheless,  despite the fact that simultaneously, the USA finds itself being dragged into a new conflict in the Yemen,  this represents a major triumph for Obama’s foreign policy towards the USA’s disengagement from the Middle East along the lines outlined in the Stratfor forecast.  The making of this agreement signals a dramatic change in the Middle East power balance. Israel, because of its now disappearing hopes to have become the sole significant power in the Middle East, will feel thwarted and Saudi Arabia, will be genuinely anxious that its stability could be in jeopardy.  With the Saudi formation of a Sunni resistance bloc to fight the al-Houthi rebels in Yemen, the whole of the Middle East, armed to the teeth as it has been, could erupt into a massive war – one in which one must hope that NZ is not now committed to becoming involved.

Something to add? Please leave a comment in the box below

Leave a Reply

Your email address will not be published.