Striking the US where it hurts
By Victor N Corpus *
10/19/06 "Asia
Times" -- -- A noted Chinese theorist on modern warfare, Chang Mengxiong,
compared China's form of fighting to "a Chinese boxer with a keen knowledge of
vital body points who can bring an opponent to his knees with a minimum of
movements". It is like key acupuncture points in ancient Chinese medicine.
Puncture one vital point and the whole anatomy is affected. If America ever goes
to war with China, say, over Taiwan, then America should be prepared for the
following "acupuncture points" in its anatomy to be "punctured". Each of the
vital points can bring America to its knees with a minimum of effort.
1 Electro-magnetic Pulse (EMP) attack
China and Russia are two potential US adversaries that have the capability
for this kind of attack. An EMP attack can either come from an intercontinental
ballistic missile (ICBM), a submarine-launched ballistic missile (SLBM), a
long-range cruise missile, or an orbiting satellite armed with a nuclear or
non-nuclear EMP warhead. A nuclear burst of one (or more) megaton some 400
kilometers over central United States (Omaha, Nebraska) can blanket the whole
continental US with electro-magnetic pulse in less than one second.
An EMP attack will damage all electrical grids on the US mainland. It will
disable computers and other similar electronic devices with microchips. Most
businesses and industries will shut down. The entire US economy will practically
grind to a halt. Satellites within line of sight of the EMP burst will also be
damaged, adversely affecting military command, control, communications,
computers, intelligence, surveillance and reconnaissance (C4ISR). Land-based
intercontinental ballistic missiles will be rendered unserviceable in their
silos. Anti-ballistic missile defenses will suffer the same fate. In short –
total blackout. And American society as we know it will be thrown back to the
Dark Ages.
Of course, the US may decide to strike first, but China and Russia now have the
means of striking back with submarine-launched ballistic missiles with the same
or even more devastating results. But knowing China's strategy of "active
defense", when war with the US becomes imminent, China will surely not allow
itself to be targeted first. It will seize the initiative as mandated by its
doctrine by striking first.
China has repeatedly announced that it will not be the first to use nuclear
weapons. But as an old Chinese saying goes: "There can never be too much
deception in war." If it means the survival of the whole Chinese nation that is
at stake, China will surely not allow a public statement to tie its hands and
prevent it from seizing the initiative. As another saying goes: "All is fair in
love and war."
2 Cyber attack
America is the most advanced country in the world in the field of
information technology (IT). Practically all of its industries, manufacturing,
business and finance, telecommunications, key government services and defense
establishment rely heavily on computers and computer networks.
But this heavy dependence on computers is a double-edged sword. It has thrust
the US economy and defense establishment ahead of all other countries; but it
has also created an Achilles' heel that can potentially bring the superpower to
its knees with a few keystrokes on a dozen or so laptops.
China's new concept of a "people's war" includes IT warriors coming, not only
from its military more than 2-million strong, but from the general citizenry of
some 1.3 billion people. If we add the hackers and information warriors from
Russia, Iran, North Korea, Venezuela, Cuba, Syria and other countries
sympathetic to China, the cyber attack on the US would be formidable indeed.
So, if a major conflict erupts between China and America, more than a few dozen
laptops will be engaged to hack America's military establishment; banking
system; stock exchange; defense industries; telecommunication system; power
grids; water system; oil and gas pipeline system; air traffic and train traffic
control systems; C4ISR system, ballistic missile system, and other systems that
prop up the American way of life.
America, on the whole, has not adequately prepared itself for this kind of
attack. Neither has it prepared itself for a possible EMP attack. Such attacks
can bring a superpower like America to its knees with a minimum of movement.
3 Interdiction of US foreign oil supply
America is now 75% dependent on foreign imported oil. About 23.5% of
America's imported oil supply comes from the Persian Gulf. To cut off this oil
supply, Iran can simply mine the Strait of Hormuz, using bottom-rising sea
mines. It is worthwhile to note that Iran has the world's fourth-largest
inventory of sea mines, after China, Russia and the US.
Combined with sea mines, Iran can also block the narrow strait with supersonic
cruise missiles such as Yakhonts, Moskits, Granits and Brahmos deployed on Abu
Musa Island and all along the rugged and mountainous coastline of Iran fronting
the Persian Gulf. This single action can bring America to its knees. Not only
America but Japan (which derives 90% of its oil supply) and Europe (which
derives about 60% of its oil supply from the Persian Gulf ) will be adversely
affected.
In the event of a major conflict involving superpower America and its allies
(primarily Japan and Britain) on the one hand and China and its allies
(primarily Russia and Iran) on the other, Iran's role will become strategically
crucial. Iran can totally stop the flow of oil coming from the Persian Gulf.
This is the main reason why China and Russia are carefully nurturing intimate
economic, cultural, political, diplomatic and military ties with Iran, which at
one time was condemned by US President George W Bush as belonging to that "axis
of evil", along with Iraq and North Korea.
This is also the reason why Iran is so brave in daring the US to attack it on
the nuclear proliferation issue. Iran knows that it has the power to hurt the
US. Without oil from the Gulf, the war machines of the US and its principal
allies will literally run out of gas.
A single blow from Iran or China or Russia, or a combination of the three at the
Strait of Hormuz can paralyze America. In addition, Chinese and Russian
submarines can stop the flow of oil to the US and Japan by interdicting oil
tanker traffic coming from the Middle East, Africa and Latin America. On the
other hand, US naval supremacy will have minimal effect on China's oil supply
because it is already connected to Kazakhstan with a pipeline and will soon be
connected to Russia and Iran as well.
One wonders: what will be the price of oil if Iran blocks the Strait of Hormuz.
It will surely drive oil prices sky high. Prolonged high oil prices can, in
turn, trigger inflation in the US and a sharp decline of the dollar, possibly
even a dollar free-fall. The collapse of the dollar will have a serious impact
on the entire US economy.
This brings us to the next "acupuncture point" in the US anatomy: dollar
vulnerability.
4 Attack on the US dollar
One of the pillars propping up US superpower status and worldwide economic
dominance is the dollar being accepted as the predominant reserve currency.
Central banks of various countries have to stock up dollar reserves because they
can only buy their oil requirements and other major commodities in US dollars.
This US economic strength, however, is a double-edged sword and can turn out to
be America's economic Achilles' heel. A run of the US dollar, for instance,
which would cause a dollar free-fall, can bring the entire US economy toppling
down.
What is frightening for the US is the fact that China, Russia and Iran possess
the power to cause a run on the US dollar and force its collapse.
China is now the biggest holder of foreign exchange reserves in the world,
accumulating $941 billion as of June 30 and expected to exceed a trillion
dollars by the end of 2006 - a first in world history. A decision by China to
shift a major portion of its reserve to the euro or the yen or gold could
trigger other central banks to follow suit. Nobody would want to be left behind
holding a bagfull of dollars rapidly turning worthless. The herd psychology
would be very difficult to control in this case because national economic
survival would be at stake.
This global herd psychology motivated by the survival instinct will be strongly
reinforced by the latent anger of many countries in the Middle East, Eurasia,
Southeast Asia, Africa and Latin America that silently abhor the pugnacious
arrogance displayed by the lone Superpower in the exercise of its unilateral and
militaristic foreign policies. They will just be too happy to dump the dollar
and watch the lone Superpower squirm and collapse.
The danger of the dollar collapsing is reinforced by the mounting US current
account deficit, which sky-rocketed to $900 billion at an annual rate in the
fourth quarter of 2005. This figure is 7% of US gross domestic product (GDP),
the largest in US history. The current account deficit reflects the imbalance of
US imports to its exports. The large imbalance shows that the US economy is
losing its competitiveness, with US jobs and incomes suffering as a result.
These record deficits in external trade and current accounts mean that the US
has to borrow from foreign lenders (mostly Japan and China) $900 billion
annually or nearly $2.5 billion every single day to finance the gap between
payments and receipts from the rest of the world. In financial year 2005, $352
billion was spent on interest payment of national debt alone - a national debt
that has ballooned to $8.5 trillion as of August 24.
The International Monetary Fund has warned: "The US is on course to increase its
net external liabilities to around 40% of its GDP within the next few years - an
unprecedented level of external debt for a large industrial country."
The picture of the US federal budget deficit is equally grim. Dennis Cauchon,
writing for USA Today said:
The federal government keeps two sets of books. The set the government promotes to the public has a healthier bottom line: a $318 billion deficit in 2005. The set the government doesn't talk about is the audited financial statement produced by the government's accountants following standard accounting rules. It reports a more ominous financial picture: a $760 billion deficit for 2005. If social security and medicare were included - as the board that sets accounting rules is considering - the federal deficit would have been $3.5 trillion. Congress has written its own accounting rules - which would be illegal for a corporation to use because they ignore important costs such as the growing expense of retirement benefits for civil servants and military personnel. Last year, the audited statement produced by the accountants said the government ran a deficit equal to $6,700 for every American household. The number given to the public put the deficit at $2,800 per household ... The audited financial statement - prepared by the Treasury Department - reveals a federal government in far worse financial shape than official budget reports indicate, a USA Today analysis found. The government has run a deficit of $2.9 trillion since 1997, according to the audited number. The official deficit since then is just $729 billion. The difference is equal to an entire year's worth of federal spending.
The huge US current account and
trade deficits, the mounting external debt and the ever-increasing federal
budget deficits are clear signs of an economy on the edge. They have dragged the
dollar to the brink of the precipice. Such a state of economic affairs cannot be
sustained for long, and the stability of the dollar is put in grave danger. One
push and the dollar will plunge into free-fall. And that push can come from
China, Russia or Iran, whom superpower America has been pushing and bullying all
along.
We have seen what China can do. How can Russia or Iran, in turn, cause a dollar
downfall? On September 2, 2003, Russia and Saudi Arabia signed an agreement on
oil and gas cooperation. Russia and Saudi Arabia have agreed "to exercise joint
control over the dynamics of prices for raw materials on foreign markets". The
two biggest oil and gas producers, in cooperation, say, with Iran, could control
oil production and sales to keep the price of oil relatively high. Sustained
high oil prices, in turn, could trigger a high inflation rate in the US and put
extreme pressure on the already weak dollar to trigger a more rapid decline.
Russia is now the world's biggest energy supplier, surpassing Saudi Arabia in
energy exports measured in barrel oil equivalent or boe (13.3 million boe per
day for Russia vs 10 million boe per day for Saudi Arabia). Russia has the
biggest gas reserves in the world. Iran, on the other hand, runs second in the
world to Russia in gas reserves, and also ranks among the top oil producers. If
and when either Russia or Iran, or both, shift away from a rapidly declining
dollar in energy transactions, many oil producers will follow suit. These
include Venezuela, Indonesia, Norway, Sudan, Nigeria and the Central Asian
Republics.
There is a good chance that even Saudi Arabia and the other oil-exporting
countries in the Middle East may follow suit. They wouldn't want to be left with
fast-shrinking dollars when the shift from petro-dollar to euro-dollar occurs.
Again, the herd psychology will come into play, and the US will eventually be
left with a dollar that is practically worthless. Considering the strong
anti-American sentiments in the world caused by American unilateralism,
especially in the Middle East, a concerted effort to dump the dollar in favor of
the euro becomes even more plausible.
When the dollar was removed from the gold standard in August 1971, the dollar
gained its strength through its use as the currency of choice in oil
transactions. Once the dollar is rejected in favor of the euro or another
currency for global oil transactions, the dollar will rapidly lose its value and
central banks all over the world will be racing to diversify to other
currencies. The shift from petro-dollar to petro-euro will have a devastating
effect on the dollar. It could cause the dollar to collapse; and the whole US
economy crushing down with it - a scene reminiscent of the collapse of the Twin
Towers on September 11, 2001. But this one will be a thousand times more
devastating.
A successful assault on the US dollar will make America crawl on its knees with
a minimum of movements. And this assault can come from China, Russia or Iran -
or a combination of the three - if they ever decide that they have had enough of
US bullying.
5 Diplomatic isolation
In 1991, when the Soviet Union collapsed from its own weight, the US emerged
as the sole superpower in the world. At that crucial period, it would have been
a great opportunity for the US to establish its global leadership and dominance
worldwide. With the world's biggest economy, its control of international
financial institutions, its huge lead in science and technology (specially
information technology) and its unequaled military might, America could have
seized the moment to establish a truly American Century.
But in the critical years after 1991, America had to make a choice between two
divergent approaches to the use of its almost unlimited power: soft power or
hard power. The exercise of soft power would have seen America leading the world
in the fight against poverty, disease, drugs, environmental degradation, global
warming and other ills plaguing humankind.
It would have pushed America in leading the move to address the debt burden of
poor, undeveloped or developing countries; promoting distance learning in remote
rural areas to empower the poor economically by providing them access to quality
education; and helped poor countries in Asia, Africa and Latin America build
highways, railways, ports, airports, hospitals, schools and telecommunication
systems.
Unfortunately, such was not to be. If there was any effort at the exercise of
soft power at all, it was minimal. In fact, it is not America which is
practicing soft power in diplomacy but a rising power in the East - China. China
has been busy in the past decade or so exercising soft power in almost all
countries in Africa, Latin America, Central Asia, Southeast Asia, South Asia and
the Middle East, winning most of the countries in these regions to its side.
Through the use of soft power, China has created a de facto global united front
under its silent, low-key leadership.
The US, on the other hand, decided to employ mainly hard power in the exercise
of its global power. It adapted the policy of unilateralism and militarism in
its foreign policy. It discarded the United Nations and even the advice of close
allies. It unilaterally discarded signed international treaties (such as the
Anti-Ballistic Missile Treaty). It adapted the policy of regime change and
preventive war. It led the North Atlantic Treaty Organization in the 78-day
bombing of Serbia purportedly for "humanitarian" reasons. It invaded Afghanistan
and Iraq without UN sanctions and against the advice of key European allies like
France and Germany.
The US-led war in Iraq was a tactical victory for the US initially, but has
resulted in strategic defeat overall. The Iraq war caused the US to lose its
principal allies in Europe and be isolated, despised and hated in many parts of
the world. Without too many friends and allies, the US is likened to an "emperor
with no clothes".
So in a major conflict between America and China, isolated America cannot
possibly win against a global united front led by China and Russia.
This brings us to the question of alliances, another "acupuncture point" in the
anatomy of the superpower, which will be addressed in the second part of this
report.
Click here for part II - The assassin's mace
*
Victor N Corpus is a retired brigadier general of the Armed Forces of the
Philippines (AFP); former chief of the Intelligence Service, AFP; and holds a
master's degree in public administration from the Kennedy School of Government,
Harvard University.
Copyright 2006 Asia Times Online Ltd