Contributed by Chriss Street. Specialist in corporate reorganizations and turnarounds, former Chairman of two NYSE listed companies. His latest book, The Third Way, describes how to achieve management excellence and financial reward by moving organizations from Conflict and Confrontation to Leadership and Cooperation. Chriss lives in Newport Beach, CA.
In thirty years, historians will mark the assassination of America’s Ambassador to Libya on September 11, 2012 as a more important event than the terrorist attacks in 2001. On “9-11,” the United States’ self-appointed role to provide peace in the Western World as the only military super-power was challenged for the first time since the collapse of the Soviet Union. Eleven years later, on “911 Squared”, that role was terminated.
Thirty years from now, historians will mark the assassination of America’s Ambassador to Libya on September 11, 2012 as a more important event than the terrorist attacks on September 11, 2001. On “911”, the United States’ self-appointed role to provide relative peace in the Western World as the only military super-power was challenged for the first time since the collapse of the Soviet Union in the mid-1980s. Eleven years later, on “911 Squared”, that role was terminated. As television cameras recorded an overwhelmed America under siege throughout the Middle East, the real action moved to the Pacific where Russia, China and Japan took advantage of the American power vacuum to mobilize their militaries to enforce their own strategic ambitions in the Pacific.
Russia seized control of up to 1.5 million square miles of the Artic by opening bases to station a squadron of 20 MIG 31 Foxhounds, the fastest fighter jet in the world. China claimed sovereignty over the 1.35 million square mile South China Sea and launched its first aircraft carrier to enforce its dominance. Japan’s leading political party announced they will seek to terminate Article 9 of the Japanese Constitution that prohibits offensive acts of war and the Japanese navy began joint naval exercises with Russia. The Philippines moved to protect their claims to islands in the South China Sea by deploying 800 marines and setting up a permanent base on contested Spratly Islands. The South Korean Navy fired warning shots at North Korean “fishing boats” that may have been trying to land military personnel and take control over five contested islands in the Yellow Sea. Vietnamese President Tan Sang strengthened his country’s claims in the South China Sea by signing resource joint ventures with Russia. The common equation in all these military actions is a desire to capture potential off-shore oil and gas deposits before American protection of oil flow through the Middle East sea lanes evaporates.
America has eleven aircraft carriers, marked “CVN”, that each carry 40 attack jets. The U.S. also has nine small carriers that each transport a 1687 member Marine Expedition Force, plus helicopters and fighter jets, marked “LHA.” Because of maintenance and homeland protection, only a third of the fleet can be deployed internationally at any given time. As seen below, the navy is operating at its maximum capability by dispatching a larger naval force to the Pacific than to the volatile Middle East:
Currently the United States has three carriers operating in the Middle East trying to deal with the Iranian nuclear program, a CIA sponsored war in Syria, Taliban infiltration of Afghan security forces, Egypt’s threat to take over Sinai Peninsula and mass rioting across the region. But virtually unseen by the media, the United States has dispatched four carriers in the Western Pacific to respond to the Russian land grab, Chinese aspirations demands, North Korean nuclear threats and emergence of a new imperialist Japan.
Over the last eleven years, U.S. federal spending doubled, but the U.S. economy grew by only 50%. Today our national debt is at the Greek level of 105% of our economy, versus just 55% in 2001. It is obvious to world leaders that the United States is maxed out financially and will be forced to cut spending across the board, including defense.
Meanwhile, the annual United States Center for Army Leadership independent report determined that only 25% of the Army’s 570,000 officers and enlisted soldiers believe the nation’s largest military branch is headed in the right direction — a survey response that is the lowest on record and reflects what some in the service call a crisis in confidence. Morale scores were especially low in Afghanistan and records reveal that the monthly suicide rate hit a new high of 26 in July of this year. The effectiveness of America’s fighting forces is rapidly deteriorating after 11 years of sustained combat.
As we recently documented, the United States is rapidly approaching North American energy independence, having reduced our reliance on Persian Gulf oil from over 30% in 2005 to just 10% today; but the rapidly growing Asian economies have all increased their percentage reliance on Persian Gulf oil to over 40% today, even as Middle East Arab Spring reduced output in Iran, Libya, Egypt, Sudan and Syria.
With the American military dominance of the Middle East now a fading concept, the sea lanes will increasingly be at the mercy of radical Islamists. The Shiites will be more motivated to try to rebuild the Persian Empire that dominated the Persian Gulf region for 1000 years and the Muslim Brotherhood will be more motivated try resurrect the Moorish Caliphate that dominated North Africa and Southern Europe for 700 years.
For America, elimination of the military burden of being responsible to enforce peace in the Middle East is a net financial positive. For Asia, Middle East oil flow represents continued progress, whereas disruption represents economic downfall and starvation.
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