The Big Picture I

This article first examines the United States’ gradual rising dynamics after World War II, and how it became the sole superpower of the world after the collapse of the USSR. The threats that it is facing, its current politics on the world, (Iraq War,Afghanistan, etc...) and the reasons why the US's "superpower' role must end, will be explained according to Power Transition Theory, Balance of Power Theory and Quantity Theory of Money.

The United States took the first steps of economic globalization by Breton Woods System (1944), which was an international monetary management in order to regulate the economic relations among its allies. By Breton Woods American dollar has been accepted as the reserve currency. After the World War I and Great Depression the European countries were devastated by the war and their economies were in bad situation and were instable. By Marshall Plan, in 1947, The United States offered up to $20 billion for economic recovery, but only if the European nations could get together and draw up a rational plan on how they would use the aid.1Further more Breton Woods and Marshall Plan ended English currencies dominance on the world. In addition to Breton Woods and Marshall Plan, foundation of the World Bank also enabled the U.S to inject dollar, to developing countries by providing advices and funds with reasonable interest rates and thus to expand its influence on every part of the globe. Soon the American dollar became the reserve currency in world trade. Ever since 1971, when US president Richard Nixon took the dollar off the gold standard (at $35 per ounce) that had been agreed to at the Breton Woods Conference at the end of World War II, the dollar has been a global monetary instrument that the United States, and only the United States, can produce by fiat.2

According to The Federal Reserve Board, recent estimates show that between one-half and two-thirds of the value of currency in circulation is held abroad. Some residents of foreign countries hold dollars as a store of value, while others use it as a medium of exchange. Besides from 1995 to 2005, the value of currency in circulation increased 89.0 percent to $758.8 billion, which represents an average annual growth rate of 6.6 percent.3 In short, dollar became a hegemonic power to rule and reshape the world in the game called “capitalism”. Henry C. K. Liu, elaborates the dollar domination very well. According to him:

“World trade is now a game in which the US produces dollars and the rest of the world produces things that dollars can buy. The world's interlinked economies no longer trade to capture a comparative advantage; they compete in exports to capture needed dollars to service dollar-denominated foreign debts and to accumulate dollar reserves to sustain the exchange value of their domestic currencies. To prevent speculative and manipulative attacks on their currencies, the world's central banks must acquire and hold dollar reserves in corresponding amounts to their currencies in circulation. The higher the market pressure to devalue a particular currency, the more dollar reserves its central bank must hold. This creates a built-in support for a strong dollar that in turn forces the world's central banks to acquire and hold more dollar reserves, making it stronger. This phenomenon is known as dollar hegemony, which is created by the geopolitically constructed peculiarity that critical commodities, most notably oil, are denominated in dollars.”

In an economy there is a direct relationship between the quantity of money and the level of prices of goods and services sold. According to Quantity Theory of Money, a rapid increase in money supply leads to a rapid increase in inflation. Money growth that surpasses the growth of economic output results in inflation as there is too much money behind too little production of goods and services. In order to curb inflation, money growth must fall below growth in economic output.4

Since Nixon administration took the dollar off the gold standard, as mentioned above, it is neither fixed to gold nor has the equivalent good or services in the country. For this reason the American dollar’s value is only but only fixed to the stability of the United States. Any attempts to destabilize it, will also have instable effect on its currency as well. Thus economic and political issues are highly intertwined.

After the decline of the USSR in 1991, the United Sates became the superpower of the world and had an opportunity to expand the free markets, thus to be able to influence new territories. Soon economic superiority enhanced its political and military strength. Today economically, politically, militarily and technologically the hegemony of the United States is beyond debates.

According to Organski (World Politics, 1958), international system is in a hierarchic structure that looks like a pyramid. The strongest state is on the top of this pyramid and is called “dominant power”. The dominant power has the largest proportion of power resources (Economic, political, cultural and technological). There are also a collection of “great powers” which can be or may be the rivals of the dominant power. “Middle powers” follows the great powers in the hierarchic system and finally “small powers” come after the middle powers. These dominant powers, or hegemons, commonly arise and use their power to create a set of political and economic structures and norms of behavior that enhance the stability of the system at the same time that they advance their own security.

In other words, this state is interested in maintaining the "status quo" of the international system. Organski and Jacek Kugler defined status quo states as those that have participated in designing "the rules of the game" and stand to benefit from these rules. Challengers, or "revisionist states”, want "a new place for themselves in the international society" commensurate with their power. Revisionist states express a "general dissatisfaction" with their "position in the system", and they have a "desire to redraft the rules by which relations among nations work". At this point, Power Transition Theory (PTT) presumes that there should be counterbalancing and challenging powers against The US hegemonic power.

Today, there is neither a state nor a group of states considered as superpower or an equivalent of the United States in order to counterbalance it. However, as Power Transition Theory points out the world politics are creating alternative powers to counterbalance the imbalanced world. Counterbalance of a hegemonic power is presumed by balance of power theory as well. According to this theory, serious threats of hegemony are a sufficient condition for the formation of a blocking coalition, which leads either to the withdrawal of the threatening power or to a hegemonic war. (Levy,Jack The Causes of War and Conditions of Peace, Annual Review Pol. Sci. 1998,1:139,65) These blocking coalition, counterbalancing powers, are serious threats to the preeminence of the hegemonic powers and what if they are not controlled immediately the unipolar system will be replaced with bipolar or multipolar systems, which ever balances the world, in the cost of severe, hegemonic wars.

In short the Balance of Power Theory, Power Transition Theory, and Quantity Money Theory, indicate that the role of the US as the “World’s Policeman” will end soon. The European Union (EU) and Shanghai Cooperation Organization are two potential threats to the US to succeed this end; because they have the capability of cracking the globalization. Globalization is, simply, the accumulative results of those rules that strongest power set to get benefit from. In addition to Shanghai Cooperation Organization (SCO) members and the EU countries, there are several unions and countries that are showing their dissatisfaction with the status quo. Iran, Venezuela Sudan,Syria, are a couple examples. Since all the dissatisfied countries have the same end, to get a better allocation of resources and a better position in the hierarchy, they all take steps towards common policies among each other against the dominant power. The logic behind these polices is, the enemy of my enemy is my friend. The current debate between Bush and Putin over missile shield in Poland or the China’s first satellite destroyer missile in the space and Iran's nuclear enrichment activities are the signals from “challenging powers” to the dominant power. Thus, the challenger powers desire to end the unipolar world system and create a new system which will let them have a better position, in the ranks of in international arena (pyramid) and get more resources from the reallocation of the natural sources on the world.

(To be continued....)

LET THEM CROSS THE BORDER

Recently, in Turkey, there is a severe debate over a possible cross border military operation against PKK in Northern Iraq, Southern Kurdistan. Political parties, business organizations, non-governmental organizations, military and civilians are debating about the costs and benefits of such an operation. Thus, all of Turkey is divided, basically, into two groups ; one sees the cross border operation as a crucial milestone to annihilate the Kurds' nation building activities in Southern Kurdistan, in general, and the PKK, in particular; the other defends that such an action will put Turkey in a troublesome situation and isolate it in the international arena--if still exists after the operation.

The U.S.-led invasion of Iraq enhanced Southern Kurdistan's political position remarkably. After a long time, Kurds were on the brink of their independence. This fact gave fear to the neighboring countries because their main concern was the possible influence of an independent Kurdish state on the Kurdish populations within their boundaries. Turkey,the biggest coward, cooperated with Iran and Syria to weaken--or better, destroy--the new born Kurdish Regional Government (KRG). In addition to signing official and unofficial agreements against the Kurdish people and conducting brutal black operations in Kurdistan, Turkey used, and still is using, the PKK as an excuse to justify its military operations. Turkey claims that the PKK launches its operations from South Kurdistan, however most of the PKK fighters are located within Turkey, while only a small number of them reside on Mount Qendil. Turkey's operations aim to destabilize and then destroy the KRG. As the KRG practices its de facto independence, it faces Turkey's cross-border operation threats. Turkey is like a beast which has a thick piece of wood in its hand and threatens to hit people on the head at any moment. Repeating the same threats over and over tires people and they prefer to be hit once rather than be disturbed one hundred times. Thus, Turkey's credibility is beyond seriousness; however, if somehow it carries out a comprehensive cross-border operation aiming at KRG, that will not only be its last operation but also the last time the international arena knows it as the Turkish Republic. For that reason, let the Turks cross the border.

Firstly, in world politics the conventional wisdom is that major powers usually try to keep the “status quo”, even though in some international relations ( IR) theories the contrary is the case. Any remarkable deviation or any unexpected change from current policies or situations, requires a cost-benefit analysis for each state. If benefits are higher than costs, they take their position according to new change. If not, they will try to change the cause in way that will favor themselves. Turkey's cross-border operation would be a major change in the international arena in terms of political, geopolitical, economic, and military consequences. Since the status quo favors the major powers, they will oppose any operation which will result in new alliances, new threats, or the re-balancing of power distribution all over the globe.

For the US, it will not want one more problem in Iraq and more debates at home. For China, it will make sure that oil flow through oil-rich Southern Kurdistan will not be interrupted. Talabani and Hu Jintao, the president of China (PRC), reached several trade agreements and China erased all of Iraq's previous debts. Besides Turkey does not have a good reputation in the eyes of the Chinese government because Turkey sheltered ethnic Turk Uygur separatists from the Xingyan region of China. China wanted Turkey to hand them over but Turkey refused to do so. China definitely will be upset with Turkey's possible operation. Russia, on the other hand, is complaining louder nowadays about the American presence in the Middle East. Russian President Putin thinks that the U.S. aims to exploit the oil and water resources in the whole region, including countries over which Russia has influence. While urging the US to leave Iraq as soon as possible, Putin will not tolerate Turkey's cross-border operation as it may give an excuse to the US to remain in the region longer. In short, none of these “ big brothers” will permit Turkey to have a cross-border operation; furthermore, they are the permanent members of the United Nation's Security Council ( US, China, Britain,France and Russia). If Turkey has an operation, it will face several punishments ranging from economic sanctions to the use of military force, both of which will isolate Turkey from rest of the world.

Secondly, such a cross-border operation will internationalize the Kurdish Question. Turkey has spent an enormous effort to keep this question quiet and to hide her brutal policies against the Kurds until this day. Whenever a Kurdish newspaper uncovered the real face of the Turkish government, it was banned. The Kurdish TV channel, Roj TV, became a major issue between Denmark and Turkey. Finally, after losing the arm-wrestling against Denmark, Turkey tried to block the channel's frequencies so as not to be broadcast in Northern Kurdistan. A cross-border operation by Turkey, then, will alert the international media and will show the real face of Turks to the entire world.

Thirdly, a cross-border operation will contribute to the unification of all the Kurds. The imperialist powers always used the “ Good Kurds- Bad Kurds” card. According to this card some Kurds were allies and others were enemies; this dilemma deepened the conflicts between the Kurds. For instance, KDP and PUK fought against each other for years; KDP cooperated with Turkey and had brutal operations against its own brothers, the PKK gerillas; in Turkey the Kurdish village guards armed against their, sons, daughters, uncles and sometimes sisters. However, today the Southern Kurds have a semi-autonomous state, which has a parliament, president, constitution, and sovereignty. It lacks only one thing, independence. These gains belong not only to Southern Kurds, but are accepted as gains for all the Kurdish people. All Kurds around the world see the KRG as the legitimate face of Kurds in the international arena. Thus, any threat to this entity will be treated as a threat to all Kurds. The Kurds in Turkey will rebel, as will the Kurds in Iran and Syria, against their governments. For centuries, this may be the very first time that Kurdish nationalism will be at its peak level and thus may bring the only missing thing, independence.

Fourthly, Turkey's economy is very fragile. A great amount of money in circulation is based on money that does not create any value, such the money injected into the economy from the illegal drug trade. In an economy, the money in circulation must be equal to the goods and services produced. If not, it will lead to inflation, inflation will cause high interest rates, high interest rates are the last thing an investor wants. Lack of investments will cause high unemployment rate and high unemployment will lead to severe social problems. Since half of the money in the Turkish market comes from the illegal drugs, the other half is given to Turkey by International Monetary Fund (IMF) as loans. The boss of the IMF is the US, thus if Turkey insists on engaging in a cross-border operation despite the objection of the U.S., Turkey's economy will, more than likely, collapse.

With these facts, if Turkey still wants to have a military operation, let the Turks cross the border.