1973 and 2001

On October 17, 1973, members of Organization of Arab Petroleum Exporting Countries chose to embargo the United States, Western Europe and Japan for their support of Israel in the Yom Kippur War. Both the United States and Japan responded by looking into alternative energy sources and improving energy efficiency. However, while Americans quickly forgot the lessons of 1973, the Japanese did not. As Peter Schwartz notes (p145)

In 1973, the United States and Japan were hit with the same challenge: a quadrupling of oil prices. The United States responded with a winners and losers scenario in which it was, it eflt, the winner. “This is temporary, we will surely will,” said American policymakers. “We don’t need to worry about it.” Within a year, the United States was importing half its oil. Japan responded instead by completely rebuilding its capital structure to become the most energy-efficient economy in the world.

Americans still saw environmentalism as zero-sum. You could either have economic growth and prosperity, or more environmentally friendly policies, but not both. This is why we are still struggling with what the Japanese figured out over three decades ago.

Today, while Americans are beginning to realize that environmentalism isn’t zero-sum, we are polarized in another crucial national security debate: terrorism. You can either fight terrorists and failed states with force and be safe, or you can avoid force and be overrun by jihadis and rogues.

Americans once thought “sustainable development” was a contradiction. Economic growth and environmental quality couldn’t go together. Yet, we’ve learned they can. What will be our “sustainable counter-terrorism” ?

About Chirol

Sir Ignatius Valentine Chirol (1852 - 1929) was a journalist, prolific author, world historian, and British diplomat. He began his career as a foreign correspondent and later became editor of the London Times. After two decades as a journalist he joined Her Majesty's Foreign Ministry as a diplomat and was subsequently knighted for his distinguished service as a foreign affairs advisor. Additionally, he wrote a dozen books on foreign affairs including The Far Eastern Question (1896), Serbia and the Serbs (1914), The End of the Ottoman Empire (1920) and The Egyptian Problem (1921). He is generally credited with popularizing "Middle East" in reference to the Arabian Peninsula with his book The Middle Eastern Question (1903). "Chirol" is a US citizen and graduate student studying Defense and Strategic Studies and government contractor. As with the historical Chirol, he has traveled to over two dozen countries and lived abroad for many years. Chirol speaks English and German fluently with basic knowledge of manyl of others.
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7 Responses to 1973 and 2001

  1. Mark says:

    Or the US could mind its own business and it won’t be a target for terrorists, like Japan, Switzerland, etc. When the credit crunch finally hits, maybe the US won’t have a choice but to disengage for world policing, because it can’t afford it.

  2. Dan tdaxp says:

    The reverse domino effect, with occasional bouts of invading other countries.

    How has Japan’s economy done compared to ours over the past generation, again?

  3. Curzon says:

    Having lived five years in the US and five years in Japan over the last decade, I think my observations on the situation may be interesting to readers.

    In Japan, the concentrated nature of the population makes public transportation efficient (and even profitable) and easy to sustain and maintain. Toll roads, car fees, and gasoline are expensive enough that its almost never worth driving unless you have a family of at least three people. So the country operates without everyone having to drive, and has a very sound public transportation infrastructure. And were the gasoline sky-rocket in price or the supply to suddenly be cut in half, the country would continue to function.

    In the US, the very existence of suburbia is based on the premise of cheap gasoline and everyone being able to drive themselves. Were gasoline to triple in price, or the supply to suddenly be cut in half, its frankly hard to see how suburbia, and thus much of middle class America, to continue to enjoy current luxuries, as commuting to work, delivering food and supplies to distant places, and much more would cease to be possible. With almost no remaining long-distance infrastructure in the US outside of trucks and automobiles, the country is incredibly vulnerable to any constriction on gasoline supply.

    Yet the oil imports to the United States are diverse, and come from the Middle East, Africa, Indonesia, elsewhere in the Western hemisphere plus domestic production. Japan is more resilient in that daily life is less dependent on cheap auto fuel, but it is dependent on the Middle East (with a trickle from Indonesia and North America) and thus far more vulnerable to a regional crisis. US oil supplies are diverse enough that the country is really only doomed if there was a system-wide failure in the import/export chain of global energy supplies. I believe the numbers are that 86% of Japan’s oil comes from the Middle East, compared to 19% of the United States.

  4. Curzon says:

    How has Japan’s economy done compared to ours over the past generation, again?

    Well, Japan suffered a recession through the 1990s, but the social cost in that recession was minimal — unemployment remains low, consumer spending remained high throughout. Regardless, Japan’s economic problems stem from an antiquated banking and legal system and inefficient businesses propped-up by the political economy. Any attempt to connect Japan’s energy efficiency to its macroeconomic performance is at best facile, if not wholly disingenuous.

  5. von Kaufman-Turkestansky says:

    _How has Japan’s economy done compared to ours over the past generation, again?_

    One might look at it this way – organizing things in such a way that the basic assumption is that cheap fossil energy is not inexhaustible may involve economic costs in the short run, but avoid greater costs and perhaps catatrophe in the longer run.

    That is not to say that the US-Japan comparison of the relative health of those economies rests on energy alone. There are many macroeconomic factors.

    But in a general way, I am not convinced that the real alternatives of the future are between growth, on the one hand, and stagnation (if we follow the advice of those who would support an environmentally-friendly retooling of the economy). It looks more like a choice between stagnation (if we make an effort to clean up, whether or not something can be done about “global warming”, the overuse of land a la Jared Diamond, etc) and disaster if the status quo is maintained.

    Now, Chirol’s question – I guess that “sustainable counter terrorism” would involve strong institutions, the rule of law working in tandem with strong intelligence agencies. That is to say, good information on the one hand but doing our best to uphold people’s rights on the other hand, not being arbitrary, and allowing for mechanisms to correct and fend off injustice. We (speaking as a Canadian) have to practice what we preach, otherwise we might as well be Turkmenistan.

  6. alec says:

    I love this post — seriously, great job. I’ve been reading a lot of Small is Beautiful recently which was the flagbearer for modern critics of unhinged free market philosophy applied to the developing world and the ‘unquantifiable’ that the free market doesn’t engage (environment, quality of loving, etc.). It’s a great read if you’re interested in a more humane and tangible version of economics. Even more impressively, it came out in the early 1970′s on the cusp of the worst decade for the developed economies.

    To answer your question about sustainable counter-terrorism or to at least share my thoughts. My largest problem with the current administration is how short-term our current efforts feel. Yes, killing terrorists may take seconds, but building strong civil societies that won’t produce future terrorists takes years and decades. And this is primarily where America has failed; while our President speaks of democracy building, we are the biggest enablers of some of the worst regimes in the Middle East. Anyway, your idea about sustainable counter-terrorism is a thought-provoking one. I think it’s important to separate being anti-terrorist and pro-Western as well. I understand that people in the Middle East won’t have a favorable opinion of the West for a while, but I do believe opinions can be swayed about terrorism. In essence, the hearts and mind we often hear about isn’t zero sum as well. The simplest answer involves political empowerment and economic development that will enable a majority of the population to disengage from radicalism.

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