Sunday, June 11, 2006

Winners and Losers in the Next World Order

Like it or not, our present Iraq War is representative of what American armed conflicts will be like in the Next World Order: costly, indecisive, difficult to terminate, and politically counterproductive.

We will never get a straight answer from the Bush administration regarding what the real political objectives of the Iraq invasion were, but they certainly weren't situation we have now. The best-trained, best-equipped, best-financed military in the history of mankind is stuck in a quagmire for which an increasing number of experts agree there is no military solution.

Our military's difficulty in achieving our political objectives is not for lack of investment in them. The U.S. now spends as much money on the Department of Defense as the military budgets of the rest of the world combined. In 2005, according to the CIA World Factbook, U.S. military expenditures exceeded $518 billion. By contrast, the emerging "peer competitor" China spent a paltry $81.5 billion. America's arms expenditures represented 4.19 percent of its purchasing power parity gross domestic product ($12.36 trillion). By comparison, China's military budget accounted for less than one percent of its GDP ($8.859 trillion).

Keep that in mind the next time you hear Secretary of Defense Donald Rumsfeld making scare noise, as he has recently, about China's "increased military spending." Also keep in mind that unlike the U.S., China is making its first real effort to modernize its conventional arsenal since the Korean War.

The Decline of Military Power

As instruments of power go, economy has trumped military might among the states in the upper world order tier nations. And economically, America has embarked on a headlong downward slide.

As of 2005, we were still first among the major political entities in GDP, but not by much. The European Union, at $ 12.18 trillion, trailed us by a mere 1.46 percent. China was behind by 28.33 percent. But those numbers only tell part of the economic competition trend.

The Bush administration has made much of America's economic growth rate, pegged at 3.5 percent for 2005. Wow. That's on par with the growth rates of Arubia, Nambia, Benin, and the Bahamas. The good news is that we're ahead of Denmark, which only posted a growth rate of 3.4 percent. And we're comfortably outpacing losers like Antigua, Mexico, Tuvalu, Mauritius, Guernsey, and Cosmoros, whose economies only grew at a measly 3.0 percent.

Granted, those economies are pretty small, and not all that influential on the overall global order.

But what about China, the number three economy in the world? (And the number two economy among single nations.) Their 2005 growth rate was 9.9 per cent.

Does that get your attention?

Then get a load of this. America's national debt is 64.7 percent of its GDP. China's is 28.8.

And China isn't pouring a half trillion plus dollars a year into the fan on its military like the United States is.

Who is America's number two creditor? China ($ 129 billion). Number one is Japan ($158 billion). We owe our number three creditor, Germany, $120 billion, and $89.3 billion to our number four creditor, Russia.

All of these nations have much to gain by siding with Iran on its nuclear energy position and blowing off Condi Rice and John Bolton.

Are you starting to get the picture? China, Russia, and the European Union sure are. Iran's political leaders sure are.

America's political leaders sure aren't.

Or at least, they're pretending not to.


Jeff Huber's Next Word Order Series


Commander Jeff Huber, U.S. Navy (Retired) writes from Virginia Beach, Virginia. Read his weekday commentaries at ePluribus Media and Pen and Sword.


  1. Jeff,

    Got a chart/graph illustrating all your points/figures? Or can you point me to one, maybe where you got the stats?

    Maybe I'll just make one myself...

    I've been caught up in recent information design stuff (hurricane evac.) that has required a lot of "gimme a simple overview" presentations.

  2. Jeff,

    No graph, I just use the CIA numbers (see the HT link).

    Interpreting some of the numbers is tricky. For example, CIA ranks GDPs by purchasing power parity, but for some of the other comparisons (i.e., military spending as a percentage of GDP) they switch to official exchange rate.

    Thus, they give China's military expenditures as 4.3 percent of GDP, though if you use the ppp GDP, it's less than one.

    I'm uncertain why they use this sort of apples and elephants comparisons. One wonders if it isn't intentional to make the Chinese sound scarier.


  3. navywife2:53 PM

    I love your Next World Order series. Why aren't you in the government? It nearly seems like this current government is running the country in the ground on purpose.

  4. I WAS in government, for 21 years. ;-)

    Glad to be out of it.

  5. navywife4:49 PM

    I meant the civilian sector. We need someone who is competent in the civilian government. :)

  6. Jeff, found your site a while ago and found more time tonight to read a bit more. Wow. Excellent and interesting stuff the New World Order series. So it's all about 'follow the money trail' isn't it? Very good point with the the creditor countries not making too many waves in terms of long as they get their money. Btw..where does the military industrial complex fit in in all of this? Just curious...

  7. Navywife;

    No. No more government work! I'll tell you anything you want to hear, but no more government work!


    Thanks for the nice words. In an Arms Race with Ourselves gives a pretty good rundown of my take on the MI complex. And yes, it has everything to do with what's going on now.

  8. navywife2:51 PM

    Speaking of an arms race, have you heard about this?,,1773106,00.html?gusrc=rss

    It reads like something straight out of Lord of War.