House of Cards

The world financial and geopolitical system has become as fragile as a house of cards. For the last fifteen years the global economy has depended on both China and super-low interest rates to maintain a fiction of stability. And even though the system went into near collapse in 2008, President Obama has implied that there is no longer a crisis and that the American people have nothing to fear from economic chaos on his watch. How long the president can continue with this belief is unclear.

The world economy is awash in debt. Whether it will be able to roll-over these same debts remains to be seen. Clearly, what happens in China will have a direct relationship to what happens in the rest of the world. Already, the price of all commodities worldwide has dropped to unparalleled lows within the modern era. This is directly due to the slowdown in the Chinese economy. For instance, as articulated in constant US dollars, gasoline prices haven’t been this low since 1965. This means that they are now equivalent to roughly $.25 cents a gallon in fifty-year-old money. Yet the American economy stagnates in the doldrums. How is this possible?

The major factor is that, for most Americans, constant debt has replaced an increase in earnings. This has been true for at least the past fifteen years, probably more. China’s economic rise has been at the expense of the American working class. Even with fairly recent cheap gas, income has dropped and the credit-card hangover challenging most Americans will take many more years to work off. Any rise in oil prices will certainly doom both the American and Chinese economy. But what could cause world oil prices to rise? A further expansion of the geopolitical chaos in the Middle East would certainly exacerbate an already delicate economic environment.

Enter Saudi Arabia and Iran. Within the last week, the Saudi embassy in Tehran was burned to the ground, while the Iranian embassy in Yemen was bombed from the air by Saudi fighter planes (claim denied). These events might not lead to direct conflict, but such direct action is cutting very close. Throughout the Arab Sunni world, the perception of Iranian hegemony, with the equally grave perception of backing from President Obama, have become truisms in politics across the region.

Even in Israel, the direction of American policy within the greater Middle East appears tilted toward Iran. This US policy direction anticipates (with a great deal of hope) a kind of regime-change involving the so-called “moderate camp” inside the factionalized Iranian polity. This was the reasoning behind Obama’s enrichment capitulation with regard to Iran’s nuclear program. It is also the reasoning behind the current de-linkage of the Obama nuclear deal from either Iranian missile testing or Tehran’s behavior in Iraq, Syria and Lebanon. But the so-called “moderates” in Iran don’t control the direction of its foreign policy. For that matter, they certainly would never agree to the de-funding of Hezbollah or dismantling its one-hundred-thousand missile infrastructure on Israel’s border. Is it any wonder that Israel’s dialogue with Russia has improved, while trust in the Obama administration has waned?

For Sunni Arabs and Israelis, ISIS is certainly not the only problem in the Middle East. Iran, Hezbollah and the lack of a neutral foreign policy in Iraq (by Tehran) are very much higher on the agenda. But if this perception of a US tilt toward Iran in Syria continues, support for ISIS and other extremists can only grow within the Sunni world. This is why Saudi Arabia must increase the pressure on Iran. If it doesn’t, it will appear weak before the eyes of most other Sunnis.

Saudi Arabia is now the spiritual and political leader of the Sunni Arab world. The Sunni Arabs will gravitate toward the force they perceive as strong in the face of regional Iranian aggression. In the final analysis, the main issue for both Sunnis and Israelis is Iranian hegemony within the greater Middle East. But the Obama White House doesn’t seem to see it that way.

At best American policy appears nebulous, at worst anachronistic. Perhaps Saudi Arabia would welcome a direct war with Iran. The continuation of Iran’s current proxy wars in Syria and Yemen has led only to American inaction and indecisiveness (the nebulous factor). But certainly a direct conflict between the Saudis and the Iranians should mean automatic US government support for its long-time Saudi Arabian ally (the anachronistic factor). But would it? I tend to think not. American popular support for Saudi Arabia is at an all-time low. This would be especially true if the kingdom is perceived by the US electorate as the aggressor.

On the other hand, the current proxy-war situation has now become far more complicated. Russia has become a direct player in Syria, while Yemen has stalemated and so too has Syria. Direct Russian involvement in Syria can only be repelled through further proxy escalation. This will mean increased Saudi reliance on Islamic jihadists. Continued Saudi support for such extreme elements alienates Americans and potentially places the kingdom itself in danger.

In Syria, Saudi officials fear that Obama actually sides with Russia and Iran in pursuit of ISIS. In such a scenario, Saudi expansion of its proxy war — through more lethal weaponry and more intense sectarian division — would hope to financially drain both Iran and Russia. However, this would make Obama’s efforts against ISIS far more complicated. But such a financial drain could also impact the Saudis (over time) without necessarily achieving the desired effect of tipping the stalemate in its favor. In fact, Russia could raise its stakes as well. Moscow has a serious reason for entering the Middle East; it has an important geopolitical card to play in Syria, and it won’t tilt against Assad (and Iranian hegemony) until it plays that card. Russia is now definitely a player both in the Levant and across the deep division within Europe itself.

In Europe, the house of cards is built on Middle East refugees, a fractured EU, a world economy in crisis, and Russian opposition to its security isolation through the expansion of NATO. Only a peaceful solution in the Middle East can prevent catastrophe on three of these four fronts. More Middle East refugees means more nationalistic, right-wing anti-EU backlash. More nationalist right-wing backlash means less support for open borders and the movement of trade and people. Less trade means beggar-thy-neighbor trade policies and a weaker economy in the face of global stagnation. A weaker economy and beggar-thy-neighbor policies usually lead to strongmen and war-like outcomes.

Europe now lives in the nuclear age. However, the risk of going back to a 1930s Great Depression scenario has become real and palpable. Right-wing populism and anti-NATO sentiment are on the rise. The balance of power in Europe still remains nuclear in nature. This was true during the Cold War, and it is true today. A nuclear balance is never really stable without a corresponding conventional component. But conventional balance has never been Europe’s strong point. Europe is becoming unstable because Russia is held outside its security tent. This affects Eastern Europe, and therefore Germany and France.

Russia could partner with the US in the Middle East, but only if the US partners with Russia in Europe. This is the important geopolitical card that Russia could play. It goes like this: Russian inclusion in the geopolitical security apparatus in Europe, in exchange for an American withdrawal and an infusion of over one-hundred-thousand UN soldiers directly into Syria to empower a political settlement within a pluralistic and democratic framework. In other words, one grand bargain in exchange for another grand bargain to be achieved within a two-region architecture of peace. Both of these concepts have been explained within my blog before. In short, NATO would go out of business, to be replaced by an all-European armed force, while a large Syrian force would be established through the offices of the UN Security Council.

In the Middle East, the Assad dictatorship would be replaced by a UN interregnum leading to a new Syrian constitution. All current factions would be disarmed. All foreign governments not a part of the interregnum would be required to remove their troops from the national boundaries of Syria. The interregnum would only consist of troops from the permanent members of the UN Security Council, and the Council would be expanded to include Japan, India and Germany.

After the new Syrian constitution takes effect, a timetable for UN withdrawal would begin, but such a timetable would be elastic to prevent any slippage on human rights. All of the many communities within in Syria would be protected from vengeance and retribution even if the interregnum takes longer than a decade. This architecture should be accompanied by a Zone of Peace for the entire Middle East. It would include a nuclear-weapons-free zone as well as guarantees for the sovereignty of all nation-states within the region.

This nuclear-weapons-free zone would include the promise of a strict adherence by all nuclear power states to achieve similar geopolitical architectures with their own nuclear-weapons-free zones. In other words, the Zone of Peace could eventually extend beyond the Middle East and become a global project. This would work to strengthen the NPT at a time when many states are now contemplating going nuclear. This expansion of nuclear weapons threatens all of Asia (North and South Korea, Japan) as well as a divided Europe (Poland, Sweden) and the entire Middle East (Iran, Turkey and a number of Arab states). Ten years from now, Iran will be on the cusp of nuclear breakout, and other nations will follow their path. An expanding global nuclear house of cards is a danger that the world will not be able to overcome. Only through the cooperation of all nations can our current economic, geopolitical and nuclear house of cards be rebuilt on a firm foundation of peace.

The realistic school of global politics and the inequality of capitalism have failed the human community of nations. Only idealistic solutions and the absence of war can save humanity from the ecological and economic challenges of the next one hundred years. If we continue on the path we have taken over the course of the last century, we will most likely collapse as a human civilization.

The current structure of world politics is built on a foundation of our own greed and power. These politics are truly a house of cards; and they are in need of bold ideas, if the world is to be repaired. The time has certainly come to repair the world! Grand bargains might appear unrealistic, but the true unreality lies within a very old paradigm of force and power. Peace must start sometime, and our only hope is to give it a chance!

About the Author
Steven Horowitz has been a farmer, journalist and teacher spanning the last 45 years. He resides in Milwaukee, Wisconsin, USA. During the 1970's, he lived on kibbutz in Israel, where he worked as a shepherd and construction worker. In 1985, he was the winner of the Christian Science Monitor's Peace 2010 international essay contest. He was a contributing author to the book "How Peace came to the World" (MIT Press).