Shooting Pool and the Illuminati

The Trump administration's approach to foreign policy seems rooted in two different versions of what the world is “really” like. Each has a different image of the world and a different prescription for reversing the progress of the last 70 years.

Shooting Pool.

To the extent that President Trump has an image of international politics, it is something like a pool game. Rock hard balls roll across the table until they carom off another ball. The point of the game is to win by manipulating those caroms to your advantage. Once the initial triangle is broken by the first shot, there is no permanent pattern or continuing relationship among the balls.

Nation-states have a hard shell of “sovereignty” and pursue their immediate self interest until they intersect another state pursuing its interest. Then they either negotiate a deal which inevitably favors one side over the other or they go to war. A state can avoid war only by having military superiority over its adversary. (The seven ball can't be counted on to help the five on its way toward the corner pocket; one state cannot be relied on to help another unless it is in its own narrow self interest.) To paraphrase an early 19^th Century English Prime Minister, there are no permanent friends or enemies; only permanent interests.

The pool table model also fits nicely with President Trump's experience in the real estate business. The world is made up of other real estate firms that interact only to compete to buy specific property and subordinate business, like contractors or resort operators, with whom one makes deals to maximize return on investment.

The Illuminati

Steve Bannon, President Trump's closest adviser, is a staunch proponent of this view. The original Illuminati were a 16^th Century Spanish sect that claimed secret knowledge and a God-given right to rule the world but it has become a comon term for a presumed secret organization of global elites who run the world. (Maybe not so secret: https://www.illuminatiofficial.org/the-official-website-for-the-illuminati/, follow them, on Twitter #illuminatti, and check out their annual meting … The World Economic Forum at Davos, Switzerland.)

In Bannon's world, a cabal of wealthy elites, top government officials, and sycophantic entertainers like Bono, has created economic globalization, undermined national sovereignty with the United Nations, the European Union, and other international bodies, tried to destroy national identities and cultures in favor of a bastardized, globalized, multi-cultural regime that actively opposes the values and traditions of Western culture. The leaders of nations in the pool game of international politics are playing on a table deigned by elites so that no matter who makes the best pool shots or wins an individual game, the manufacturer of the pool table comes out ahead.

What Is To Be Done?

The pool analogy leads to a simple strategy: make sure you get the best of every encounter. The Illuminati view also leads to a simple strategy: destroy the current “world order,” smash the pool table, and start all over.

What's Missing?

• Any understanding that international politics is not a one night stand, but a web of continuous relationships;
• Any role for America as a global leader;
• Any concern for traditional American values, such as democracy and human rights.

What's Missing: A Web of Relationships

Early 1942 was the darkest period in World War II. Nazi Germany controlled Europe and North Africa and was driving deep into Russia. Japan was rapidly expanding in Asia and across the Pacific. It was also the start of a cooperative effort by the United States and the United Kingdom to plan for rebuilding the international system at the end of the war. Beginning with the 1944 Bretton Woods Conference of some 44 nations and continuing through the creation of the Untied Nations and the adoption of the Marshall Plan, the United States led a concerted effort to create a new world order.

This grand plan for a post-war world reflected a very broad and variegated answer to the question “what caused the Great Depression and this terrible war?” The multiple causes were roughly grouped into two over-arching categories: the failure of the global economic system and the political failure to manage conflict and promote cooperation. The response was a two-pronged approach that created the institution that have shaped the international system for the past 70 years.

I'm presenting a very simplified discussion of the international economic and political system. For the sake of keeping this focused and manageable, I will discuss broad generalizations like “The IMF sucks, let's go back to the gold standard.” rather than the multitude of specific criticisms, such as “The IMF gives too little consideration to environmental impacts in its policies.”

The Economic Dimension

Show Me the Money

Rebuilding Europe would take billions of dollars: not something you could put on a credit card (which didn't exist in 1944), or find in a dusty corner of the national treasury. And borrowing large sums from another country came with a lot of political strings attached. The solution was the International Bank for Reconstruction and Development, which became a source for state borrowing for repairing infrastructure, reinvigorating industry, and pumping up consumer demand. The IBRD was so successful in Europe that it was revised and extended to become the World Bank, providing development assistance around the world.

How Much is That In Real Money?

International trade demands some way of making sure that individuals and companies from different countries know what each others' money is worth. What's the exchange rate? If I am going to agree to sell you 200,000 widgets that cost 25¢ apiece in my country there are some things I have to know. How much of your money is equal to 25¢ today, so we can sign the deal. And I need to know that your money will still be worth that much in six months or a year when I deliver the widgets and you pay me. A third consideration is that since I can't spend your funny money in my country, I need to know that I can go to a bank or some place and turn your play money widget payment into real money.

Prior to World War II, exchange rates between countries were established by using the British pound as the common denominator. But at the end of the war, given the great damage to the British economy from the global Depression of the 1930's and the even larger damage of the war itself, the pound wasn't so sterling. And since the British economy had actually shrunk, there were not enough pounds in the world to support the system of exchanging foreign money into real money.

The International Monetary Fund was established to take care of these problems. The initial IMF strategy was to use the dollar as the basis for global rates. Back in the day, the dollar was literally “as good as gold” because the value of the dollar was set by the U.S. Government as $35 for an ounce of gold. So the IMF could work out a series of exchange rates for a global economy in which every currency could be related to the dollar, which did not ever change its value. And, given the size and wealth of the U.S. economy, there were lots of dollars to take care of the needs of international trade.

The IMF has survived President Richard Nixon's decision to drop the $35/ounce link between the dollar and gold by creating a system of floating exchange rates that keep the various global currencies within narrow limits. And it has lent money to poorer countries to allow them to pay their global bills. This has given the IMF the ability to foster reforms that promote market economies and openness to foreign trade and investment.

Terrible Tariffs

There are three major reasons why governments have levied taxes on imports. The first is to raise money. In U.S. history, for example, taxes (called “customs duties”) were the single most important source of revenue for the Federal government until the income tax. The second reason is to give your own producers an advantage in the market. Simple example: if folks in country A can make and ship shoes to country B and sell them for less than the shoemakers of B, the government of B can try to compensate by taxing shoes from A so they now cost more than “Made in B” shoes. The third reason to tax stuff foreigners are shipping into a country is to level the playing field when a foreign producer has an unfair advantage over domestic businesses. For example, if the shoemakers of A pay extraordinarily low wages to their workers, or get government subsides to build factories, then B's government can tax A's shoes to make up for the fact that B's shoemakers pay decent wages or don't get government subsidies.

The second reason for imposing tariffs struck the delegates to the Bretton Woods Conference as both ideologically objectionable (since they were strongly committed to the idea of a global market free of government “meddling” and taxes) and practically counter productive. The Great Depression was a world-wide economic collapse that was made much worse by the “beggar thy neighbor” policies many counties, including the United States, pursued. In a misguided attempt to bolster their own economy by reducing imports from abroad, Country A would impose high tariffs on imports from Countries B, C and D but those countries would retaliate with their own taxes on imports from A and everyone ended up worse off.

The third reason for tariffs, leveling the playing field, seemed legitimate and in keeping with a free and fair market system.

The World Trade Organization has emerged as the most important way to deal with tariffs. In addition to several major international conferences to negotiate tariff reductions around the world, the WTO has developed means to settle disputes between nations over when a tariff is OK because it levels the playing field and when it is an illegitimate attempt to rig the game in one nation's favor.

The Political Dimension

The United Nations System

The United Nations was meant as the central institution for managing conflict's so they did not escalate to war and for promoting cooperation on problems that crossed national borders. The League of Nations was designed to prevent World War I; the events leading up to World War II exposed some glaring problems with the League and branded it as an utter failure.

The drafters of the United Nations Charter, adopted on June 26, 1945 at the San Francisco Opera House,* did not have to start from scratch. In many ways the UN is an expanded, re-branded and much improved version of the League. Instead of a League of Nations we have the United Nations, instead of a Council we have a Security Council, a General Assembly in place of an Assembly, and a Secretary-General in place of a Permanence Secretariat. The Permanent Court of International Justice (which proved to be not so permanent) became the International Court of Justice, aka World Court. These are the organs meant to deal with preventing or managing armed conflict.

*Contrary to popular belief, the document does NOT say, “This Charter will go into effect when the fat lady sings.”

There are also over 20 organizations within the United Nations system designed to promote international cooperation. But cooperation is usually pretty boring … who cares that the ICAO makes international air travel safe by mandating that every pilot of an international flight speaks English to every local air traffic controller, every international airport has identical runway striping and lighting, and every plane follows the same rules of the air … who cares that the World Health Organization has wiped out smallpox and came within an rich of eradicating polio. Although cooperation is actually much more prevalent in international politics, and the United Nations system has a pretty impressive record of achievements, it's not news and has little effect on most evaluations of international institutions.

Regional Organizations

Alongside the global UN organization, three types of regional international organizations have emerged.

Some, such as the Organization of American States and the Organization of African Unity are meant to both manage local conflicts and support local cooperation. Others, notably NATO, are meant to provide for the common defense of counties in a specific geographic area. The third type, the most successful of which is the European Union, are meant to promote economic and social development.

And there are even smaller organizations meant to deal with a very specific issue, such as the International Pacific Halibut Commission (super trivia? Yes, until you realize that without IPHC there would be no halibut for your halibut and chips.)

Trump and His Adviser's Take On International Institutions

The fundamental idea that modern nation-states exist in a web of relationships in which their well being is necessarily intertwined with other nations' well being does not fit with the pool shooter image of the world. Instead of thinking of international relations as like a friendship or alliance that aims for mutual benefit over time, the Trump view sees each interaction as a separate event in which one side must win and the other lose.

The Illuminati view of world politics sees the web of institutions as a central reality … and wants to blow it up.

What's Missing: American Leadership

The United States has played a crucial role in creating the current global system from the very beginning. The United States was the chief sponsor and intellectual guiding force behind the planning effort that culminated in Bretton Woods and the United Nations. The Marshall Plan, promoted by President Truman's Secretary of State, ex-General George Marshall, and supported by a bipartisan coalition in the Senate, offered several billion dollars to European countries to help them rebuild IF they worked through the UN and a European international organization that became the forerunner to the European Union.

The United States, under both Republican and Democratic presidents, has consistently recognized that our long term interests are best served by a peaceful and prosperous world and that requires international organizations and institutions. Even when the U.S. has objected strenuously to specific actions or failures of international bodies or felt that our interests were being thwarted by a particular action or policy, American leaders have not (until now) resurrected the 1930's isolationist slogan of “America First.” (See http://time.com/4273812/america-first-donald-trump-history/)

The Trump Administration's Take on American Leadership

For the President, every time America has tried to provide leadership in finding ways to manage conflict or promote cooperation we have simply proven P.T. Barnum right: there's a sucker born every minute; and two to take his money. Even though he never served in the military, President Trump seems partial to the army slang KMAG YOYO (Kiss my ass, guys. You're on your own.)

The Illuminati faction in the White House would like America to lead a global insurrection against the current elite leadership.

What's Missing: American Values

While we have all too often fallen far short of being “the shining city on a hill” we continue to claim that is our aspiration and we are critical of ourselves when we fail to promote our core values like democracy and respect for human dignity. The belief in American exceptionalism goes back to the earliest days of the Republic. It can lead to chauvinism and hypocrisy, but it has also meant that U.S. foreign policy has in fact included an emphasis on democracy and human rights. The emphasis has sometimes been stronger and other times more mutated, but overall it has always been there.

The Administration Take on American Exceptionalism

Both as candidate and now as President, Trump has explicitly disavowed the notion that America represents anything other than narrow self-interest. His open admiration for people like Putin (who notoriously assassinates political opponents when he is not invading neighbors) and Rodrigo Duterte of the Philippines who has ordered the police to kill all suspected drug dealers and has presided over the death,without trial, of several thousand people), makes it clear that how little traditional American values matter to his world view. Confronted by a question about Putin's reputation for killing political opponents, Trump replied "There are a lot of killers. You think our country's so innocent?"

From the Illuminati perspective, it is the rights and values of the beleaguered white working class that ought to be protected from the depredations of cosmopolitan elites.

So What?

The possible negative consequences of either shooting pool in the international system or blowing it up are difficult to specify. As Joni Michell sang, “Don't it always seem to go, you don't know what you've got 'til it's gone?” Much will depend on how much damage the Trump administration can do to the international system.

The Economic Dimension

If we try to assess the consequences for global economic cooperation, we can get a general idea of what is at stake by taking a look at what institutions can do that makes cooperation between states easier.

Provide Information. Information in the international system is typically scarce and biased. Scarce because states are limited in what they can measure and evaluate, and no single state can identify or measure any problem that transcends national boundaries. Information is biased when states collect it to serve the policy needs of governments. An international institute can help overcome both issues. For example, the 1992 Earth Summit in Rio created the Intergovernmental Panel on Climate Change which has enabled the compilation of data from around the world and issued annual reports based on that data that have convinced most of the world's governments that now is the time to act to avoid making the crisis worse.

De-politicize Issues. International institutions can offer technical solutions to concrete problems in areas where traditional diplomacy sees intangibles like “The National Interest” The International Civil Aeronautical Organization was able to establish English as the language of communication between pilots and control towers, not as a triumph of the language of the U.S. and UK over French, German, Arabic, Chinese, etc. but as a pragmatic solution to a real problem. The International Pacific Halibut Commission was created in a context of recurrent diplomatic clashes between the U.S. and Canada over fishermen from one country stealing fish in the ocean waters of the other. There were also a few occasions when fishermen took pot shots at their foreign rivals. In place of national borders and pride, the halibut commission put the stark fact that both sides were catching far too many fish and threatening them with extinction.

Introduce the Shadow of the Future. Governments, like you and me and everyone else, have a short term perspective. A bird in the hand is better than two in the bush, the pleasure that donut will give me now looms a lot bigger than the bad news from the scales tomorrow. We're all a little nicer to friends that we expect to see in the future than to anonymous strangers. Institutions, by providing information and practical solutions, can get us to pay more attention to the long run consequences of our immediate behaviors. And institutions, which give us regular and predictable opportunities to deal with the same people (or countries) time after time, make future consequences loom larger. The shadow of the future can also reassure me that if I give a little more now, I can expect to get a little more later.

Control Free Riders. A free rider is someone who benefits from an infraction or situation without contributing anything. There are several organizations who are doing wonderful things for causes I care deeply about. The cool thing is that they'll keep it up even if I ignore the latest fund raising appeal. I can get all the benefits of their hard work without paying for it. Free riding is fun … and quite rational. “Yeah, but ...” you're already thinking. If everyone decides to free ride, there won't be anyone to fight the good fight.

Institutions can prevent free riding by compelling support. The United States government does not send out an annual appeal letter with cute puppies on the cover promising me return address labels or a tote bag if I send money. I have to pay my taxes to enjoy the benefits the government provides. Clubs and professional associations and a host of private groups charge dues or membership fees instead of relying silly on the good hearts of their members to keep the lights on and the organization going. When an institution requires contributions it does not eliminate, but certainly reduces free riding.

Save Time and Money. International institutions can reduce what economists call transaction costs because they can create routine ways of doing routine tasks. Simple example: To mail a letter to a foreign before the creation of the Universe Postal Union, you had to know how that letter was going to get to its destination and buy a stamp for each country it passed through. Now you can buy one stamp at the Post office without worrying how the letter is going to make it to its destination. If you've traveled outside North America, you've seen the opposite example. Electrical voltages and plug styles vary by country and region. An equipment manufacturer has to either make two or more models of the same product, or limit sales to a specific area. And the traveler has to pack an array of adapters and transformers to keep those indispensable devices humming

International cooperation is not impossible without the web of international intuitions but it world become far more difficult, cumbersome and inefficient.

The political dimension

If we shift attention to the consequence for the International political system of an American withdrawal from leadership, one of the many major effects will be on the rise of China. I want to deal with China in another entry but the very brief version is that ever since China moved to rejoin the international system after the Mao years, the United States has tried to integrate China into the existing order even while countering China's military expansion. The belief has been that making China a full participant in the globalized economy via the World Trade Organization and persuading China to “act responsibly” as a Permanent Member of the Security Council and trying to enmesh China in the web of international organizations, China will over time become a supporter of the global status quo instead of a revisionist power intent on disrupting a system it views as a conspiracy by imperialists to keep it down. One way to view the major global conflicts of the past several centuries, from the Napoleonic wars through World War II to the Cold War, is to see them as struggles between the dominant powers and emerging states who challenge the status quo.

An American retreat from leadership over time will, at best, cede a dominant position in the UN and other institutions to China; at worst it will promote a more aggressive and expansionist policy by Beijing (and Moscow.)

Disrupting the current international order and reverting to some version of the 19^th Century “spheres of influence” runs a serious risk of ending the way that system did … in global war.

A Large Dollop of Doom and Gloom

If by some terrible quirk of fate the nihilistic Illuminati view were to actually take a wrecking ball to the world as we know it, the results would be hard to contemplate.  Europe would return to the hyper nationalism that led to so much bloodshed in the past three centuries.  In the absence of global economic institutions China and India could not sustain their economies and literally billions of people would slide back into poverty.  The United States would suffer economic decline and we wold find ourselves increasingly alone in a world of desperate people.

 

Fortunately, as far as I can see, this is extremely unlikely to happen.

A Little Less Doom and Gloom

Intentional institutions in the last 70 years have proven to be pretty resilient. The United Nations was created in a world where there were only 55 states and much of the world was subsumed in a colonial empire. The framers labored under the mistaken assumption that the Soviet Union had to cooperate with the new regime for it to succeed. Everybody knew that the Germans and French hated each other, had always hated each other, and would always hate each other.

The abdication of American leadership and commitment to human rights and democracy matters, but America is too entangled with the rest of the world, both economically and politically, to completely withdraw into an “economic nationalist” shell. Global economic institutions do, on the whole, improve the lives of everyday people around the world.

The pool shooters and Illuminati can weaken institutions, they can retard progress and screw up the U.S. economy, but I do not think they can succeed in the long run in wrecking everything.