Some weeks ago, I wrote suggesting that the multi-polar world we are now entering might well be more peaceful than the unipolar world of the 1990s. I still believe that to be the case in the long run, but the problem is that we will need highly capable policymakers in the West to signal to other players both our acceptance of their status and our unwillingness to reward their aggressive behavior. That transition looks increasingly difficult, and its difficulty is part of the poisoned inheritance of the next President. Truly the post-Wall “holiday from history” is well and truly over.

The “holiday from history” of the 1990s was christened by George Will in a column on September 12, 2001, the day after the 9/11 attacks. Yet in retrospect, those attacks should have represented less of a transition than appeared at the time. The U.S. mainland had been subjected to several Islamist terrorist attacks in the 1990s; as early as 1993 it was clear that Islamism was the major remaining U.S. challenge now that the Soviet system had fallen. Conversely, the number and intensity of attacks did not increase significantly after 2001; it is only recently, in the last year or so, that there appears to have been a stepping up of them.

The 9/11 attacks thus simply represented Al Qaeda getting very lucky indeed (and, of course, New York and Washington getting very unlucky.) In retrospect there were a number of points at which U.S. authorities should have been able to stop the attacks, or at least to have limited them. Needless to say, the massive superstructure of bureaucracy and invasions of civil liberty built up by President George W. Bush is on the whole less likely to stop such attacks in the future, as we have seen in the last year. The correct solution would have been to remove political correctness and incompetence from the bureaucracy and controls we already had.

Moreover, instead of recognizing that the attacks were a very unlucky freak occurrence, Bush abandoned his carefully thought through “modest” foreign policy, of limiting U.S. intervention, and began an activist approach to disturbances in the Middle East and elsewhere. He also referred to North Korea, Iran and Saddam Hussain’s Iraq as an “Axis of Evil:” in the 2002 State of the Union address, a piece of childish ill-conceived rhetoric with little basis in reality that left no incentive to better behavior from Iran in particular, at that point run partly by moderates.

Bush’s invasion of Iraq was in retrospect a disaster, not so much because of its conception but because of the way it was implemented. Removing the Iraqi whom we had identified as a potential future leader, Ahmed Chalabi, and instead imposing a clumsy direct rule followed by suspect elections was in retrospect a huge mistake – we should have been out of there within a year with a new leader imposed by us, however dubiously democratic and corrupt, taking the place of the despot we had overthrown.

President Barack Obama has not improved matters. The hysterical “Arab spring” welcome to the Egyptian uprisings was obviously naïve and foolish at best, and the intervention to remove Libya’s Muammar Gaddafi was criminally incompetent, both in conception and execution. In Syria, not only did we intervene ineffectively, but we intervened on the wrong side, supplying arms to rebels against an established government. Experience in Iraq (not to speak of the Troppau Protocol principles that should guide all foreign policy) should have taught us that in the Middle East, the devil you know in the form of Bashar al-Assad was very much better than the devil you don’t, and the chaos caused by a civil war between the two devils was very much worse than either. From a position of strength, in which its word was undoubted in Syria, the United States has now descended to a level in which it cannot usefully intervene on either side in the Syrian civil war, and is despised by the Russians who have taken its place.

We are now paying the price for Bush’s interventionism and Obama’s ineptitude, and have got into a very difficult situation indeed. Not all the difficulties stem from U.S. incompetence, some of them stem from EU feebleness, incompetence and megalomania. The refugee crisis, in particular, was kicked off by the displacement of Syrians by the U.S.-caused civil war in that country. However, it has been made much worse by Angela Merkel’s moral preening. It has been further exacerbated by the refusal of the EU bureaucracy to accept that many of its ideas are both unworkable and unacceptable to the people it purports to rule.

The Euro would have worked fine if applied to a modest group of fiscally disciplined countries in Northern Europe (which, given the need for fiscal discipline, would not have extended to France) but has been a disaster when applied to the profligate countries of the Mediterranean and the partially restructured economies of the former Eastern Europe. Similarly, the Schengen Agreement would have caused only moderate angst if the EU had first ensured that the union was fully in control of its external borders. Thus the chances of a break-up of the EU (beyond Brexit) are significantly more than zero, and also significantly more than the chances of the EU playing the important role in world affairs which its size and economic strength would warrant.

As I discussed a few weeks ago, there is a future waiting for us of a peaceful multi-polar world, if we can only get there. In such a world, as in the system set up by the Quadruple/Holy Alliance in 1815-22, the major powers would be fundamentally cooperative even though their interests diverged and they competed economically. They would intervene under the Troppau Protocol principles when unrest in an area such as the Middle East threatened global peace, and in such cases they would generally intervene to prop up the existing regime rather than overthrow it (there might be the occasional exception to this principle, perhaps North Korea, but they would be very rare indeed.)

Such a world would not only be generally peaceful, it would be generally stable, since the downside risks of nuclear war to any of the major participants would be utterly unacceptable. (This is the important way in which such a situation today would differ from that before 1914, when the participants did not know what lay ahead – the 1914-18 war destroyed the governments of four of the six major European participants and wrecked the economies and morale of the other two – only the United States, not part of the European balance in 1914, came out ahead.)

However, we currently have a situation in which two of the future Great Powers, Russia and China, have come to believe they can benefit by aggression against the previous hegemon, while a third potential Great Power, the EU, is in danger of breaking up altogether and is quite unable to take useful action. Meanwhile a number of smaller powers, notably North Korea, ISIS and to some extent Iran, are terrorist states on the model of Serbia in 1914, but with modern technology giving them far greater powers of destruction.

We have a multi-power system that is far from equilibrium, and in which no agreement on fundamental principles appears possible. What’s more, utterly misguided economic policies in the United States, Britain, the EU and Japan have made it likely that we will shortly suffer another Great Recession, with massive destruction of malinvestment “value” – the misery this will cause will itself raise the likelihood of geopolitical aggression, as it did in the 1930s.

To get from the current dangerous position to the ultimate much safer one, we need good leadership in the United States, not a trivial requirement for success. Without that, further aggressions will continue. If the U.S. pursues an isolationist policy, Russia and China will continue biting off larger and larger chunks of the countries around them, without anything to stop them. If the U.S. reverts to a neocon interventionist policy, Russia and China will make very sure any interventions becomes quagmires, losing all support at home and thereby enabling Russia and China to pursue their aggressions without U.S. hindrance. The one saving grace, unlike in the 1930s, is that neither of the two aggressive powers wants an all-out war, because they do not believe they could win it. With poor U.S. policy, however, that could change quite quickly.

The solution is for the U.S. to find a President who rebuilds its defense capabilities in the new more hostile world, reversing the 1990s “peace dividend” that was wasted by President George H.W. Bush on idiotic environmental and social programs, while being extremely reluctant to use force, except in a coalition of all the major powers for a clearly defined purpose of restoration of order.

Eventually, after a few years of firm, restrained policy and defense rebuilding, it should be possible for the U.S. to call a new Congress of Vienna, in which the major powers (but not the riff-raff of the United Nations) could settle their differences and construct a new stable and multi-polar world order, together with a mechanism for settling disputes and quelling the small fry when they got aggressive. In such a Congress, the U.S. could play the benign pacific role of Castlereagh, perhaps allowing some Chinese statesman to play that of the wise intermediary Metternich, while Vladimir Putin played Czar Alexander I, initially aggressive but eventually thwarted.

In the meantime, the President elected on November 8 will be handed a truly unpleasant foreign policy legacy on January 20. If we are not very lucky indeed, the President elected in November 2020 will find matters even worse.

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(The Bear’s Lair is a weekly column that is intended to appear each Monday, an appropriately gloomy day of the week. Its rationale is that the proportion of “sell” recommendations put out by Wall Street houses remains far below that of “buy” recommendations. Accordingly, investors have an excess of positive information and very little negative information. The column thus takes the ursine view of life and the market, in the hope that it may be usefully different from what investors see elsewhere.)
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