Finance may be the most powerful weapon of war. It moves armadas, armies, and squadrons. It funds troops and artillery. It endows suicide bombs and improvised explosive devices. It pays for special forces and mercenaries. It underwrites cease-fires and purchases surrenders. Finance is the weapon that makes all other weapons of war possible. ... This Article is about the financial weapons of war, their growing importance in national affairs, and their wide-ranging effects on law, finance, and society. This Article offers an early, broad examination of the realities of modern financial warfare. This Article descriptively and normatively explores the new financial theater of war, analyzes the modern arsenal of financial weapons, highlights emerging legal and policy concerns, and proposes key recommendations for current and future financial warfare. ... While policymakers, analysts, and scholars have long been studying the respective, evolving fields of modern finance and modern warfare, there has been surprisingly little meaningful legal scholarship on the crosscutting realities of modern financial warfare. Drawing on a rich legal literature that spans the laws of war, finance, and cyberspace, this Article seeks to fill this understudied, underappreciated—yet critically important—legal intersection of war and finance. ... Part I provides a general layout of the modern financial theater of war. It describes the modern financial infrastructure as a globalized, high-tech, American-centric system. ... Part II highlights particular armaments of financial warfare. Rather than provide an exhaustive catalog of financial weapons, it offers a broad inventory of the financial weapons of war. It classifies the financial weapons of war as analog weapons and cyber weapons. ... Part III contends with new concerns. It asserts that the financial weapons of war present critical challenges for traditional laws and norms relating to financial hostilities, cyberattacks, and non-state actors. ... Part IV offers new pathways. It proposes three pragmatic policy recommendations that should be undertaken in the near term response to modern financial warfare while larger issues remain unresolved by global policymakers.
At some point towards the middle of the decade, shortly before the cult of the expert smashed into the populist backlash, the shocking power of central banks came to feel normal. Nobody blinked an eye when Haruhiko Kuroda, the head of Japan’s central bank, created money at a rate that made his western counterparts seem timid. Nobody thought it strange when Britain’s government, perhaps emulating the style of the national football team, conducted a worldwide talent search for the new Bank of England chief. ... nobody missed a beat when India’s breathless journalists described Raghuram Rajan, the new head of the Reserve Bank of India, as a “rock star”, or when he was pictured as James Bond in the country’s biggest business newspaper. ... The key to the power of the central bankers – and the envy of all the other experts – lay precisely in their ability to escape political interference. ... The call to empower experts, and to keep politics to a minimum, failed to trigger a clear shift in how Washington did business. But it did crystallise the assumptions of the late 1990s and early 2000s – a time when sharp criticisms of gridlock and lobbying were broadly accepted, and technocratic work-arounds to political paralysis were frequently proposed, even if seldom adopted. ... If the clashes of abstractions – communism, socialism, capitalism and so on –were finished, all that remained were practical questions, which were less subjects of political choice and more objects of expert analysis. ... Greenspan’s genius was to combine high-calibre expert analysis with raw political methods. He had more muscle than a mere expert and more influence than a mere politician. The combination was especially potent because the first could be a cover for the second: his political influence depended on the perception that he was an expert, and therefore above the fray, and therefore not really political.
A dual education system that incorporates vocational training and classroom learning could provide young people with more options in their transition into the working world. We think that engaging employers in the design and delivery of apprenticeship frameworks is the key to preventing skill mismatches. ... Changing employers’ perceptions of youth and encouraging early engagement in schools could increase youth employability and information around career options. This could include work experience, career advice, mentoring, and youth-led social action. ... Reducing informal recruitment methods and use of qualifications as filters could reduce work barriers to engage with youth from low socio-economic backgrounds who may be at risk of anti-social behavior.
Over the past several months, I’ve interviewed Henry Kissinger, the former secretary of state, numerous times on the subject of America’s role in the world. Our conversations took place before this week’s election, but were informed by the foreign-policy differences between the candidates. ... There is obviously a gap between the public’s perception of the role of U.S. foreign policy and the elite’s perception. I think the new president has an opportunity to reconcile the two. He has an opportunity, but it is up to him to seize it. ... I’m fairly confident that China’s reaction will be to study its options. I suspect that will be Russia’s reaction as well. ... I think most of the world’s foreign policy has been in suspense for six to nine months, waiting for the outcome of our election. They have just watched us undergo a domestic revolution. They will want to study it for some period. But at some point, events will necessitate decision making once more. The only exception to this rule may be nonstate groups; they may have an incentive to provoke an American reaction that undermines our global position. ... Universities, he said, “like to teach history as a series of discrete problems. And they above all don’t want to teach Western history. They believe that the West has committed so many crimes that they are not entitled to single it out. That is a thought that would never occur to a Chinese. To return genuine pluralism to the campuses—to examine even ideas conventional wisdom rejects—has become a major national challenge.” ... What most annoyed Kissinger was the manner in which Obama talked about some other world leaders.
America’s economic health depends on sustained, long-term investment to support our families and communities and to reinvigorate the economic engine that creates jobs and prosperity. There is no viable model under which either business or government can or should shoulder the responsibility for long-term investment alone; both are required. ... The time is right for a national conversation about long-term investment in infrastructure, basic science, education and training for workers who feel the brunt of globalization and technology. We need to focus on the critical levers for economic growth along with sources of revenue to help pay for it, as well as ways to overcome the short-term thinking currently baked into government policy and business protocols. … The ideas offered here have been developed under the auspices of the Aspen Institute in consultation with a non-partisan working group of experts in public policy formation, tax and regulation, business, and corporate law and governance. While these ideas enjoy support across party lines, breaking the log jam and taking action will require a coalition of leaders across the private and public sectors who are committed to the health of the commons and America’s prosperity.