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TRATEG DTIC o Hil V ELECT1E9 CV) MAY 14 E S ST lwpoe orpbi e Ditibf t1J~ham ESSAYS ON STRATEGY Acceýioo For INTIS CRA& DT IJJCJ A 1 U d.iýou;ýced [ 4 J By Di4t. ibution / Availability Codes Avail and/or Dist Special --go!__ LI & 5ý 0 ESSAYS ON STRATEGY ,.VIII- Edited by THOMAS C. GILL U 1991 National Defense University Press Washington, DC National Defense University Preos Publications To increase general knowledge and inform discussion, NDU Press publishes books on subjects relating to US national security. Each year, the National Defense University, through the Institute for National Strategic Studies, hosts about two dozen Senior Fellows who engage in original research on national security issues. NDU Press publishes the best of this research. In addition, the Press publishes other especially timely or distinguished writing on national security, as well as new editions of out-of-print defense classics, and books based on University-sponsored conferences concerning national security affairs. Opinions, cor clusions, and recommendations expressed or implied in this vol- ume are solely those of the authors and do not necessarily represent the views of the National Defense University, the Department of Defense, or any other government agency. Cleared for public release, distribution unlimited. NVU Press p i tions ar o by the US rnment Pri Q& Office/T ordering in rmati n, cal 02) 7 3-3238 o write o Su ntend to ocu-, m~LU overn en rinting Ofce First printing, December 1991. CONTENTS Foreword ix 1. Intelligence and Economic Security 3 Jeffrey W. Wright 2. Open Skies: D~jij Vu With a New Ending? 31 Adam B. Siegel and Thomas 1. Williams 3. US-Panama Relations: Developing a Post-Noriega Strategy 59 Douglas 1. Naquin 4. Closing US Facilities in the Philippines: A Chance for Improvements 87 Bruce H. Senft 5. Concepts of Man and Public Policy: The United States, China, and France 119 Jan de Wilde The Editor 159 vii FOREWORD ESSAYS ON STRATEGY VIII BEGINS WITH A STUDY ADDRESSING the need for a shift in emph.isis within the US intelligence community away from purely defense-related matters toward in- creasingly more important issues of international economics and commerce. If changes in the world continue at the current pace and extent, they could require such 3n unprecedented reorienta- tion in national strategy. The other essays ii, this anthology also examine aspects of the changing international environment. Three of them-each of which was recognized for excellence in the Strategy Essay Com- petition sponsored by the Chairman of the joint Chiefs of Staff- analyze the requirements of US policy toward post-Noriega Pan- ama, options for relocating US military facilities displaced or soon to be displaced from the Philippines, and whether, if adopted, the resurrected "Open Skies" proposal would benefit the United States. The final essay, an especially thoughtful and wide-ranging one, explores the relationship of national public policy to differing cultural concepts of the nature of man. Written by students at the nation's Senior Service Colleges, this collection of essays exemplifies the kind of innovative, long- range thinking that will be more important than ever in the final decade of the twer.tieth century. J. A. BALDWIN Vice Admiral, US Navy President, National Defense University ix ESSAYS ON STRATEGY 1 INTELLIGENCE AND ECONOMIC SECURITY JEFFREY W. WRIGHT SHOULD THE US GOVERNMENT ASSIST BUSINESS ACTIVITIES IN competing for foreign markets and protect domestic markets from unfair competition? This question is a fair one to raise today as the Cold War fades and the Cold War economy of the United States faces fundamental changes. These changes can come willy-nilly, driven by the desire to cash in on the "peace dividend" that some say will burst forth from major reductions in the defense budget. Or they can be orchestrated by careful, innovative planning that recognizes the strategic importance of a powerful, secure, growing US economy. Surely, the national interest now requires a fresh look at how much the government should involve itself in the marketplace at home and overseas. The government's role in nurturing and protecting commerce and business will be rigorously debated in the 1990s as a new economic order develops following the collapse of communism in Eastern Europe, the stunning US-led defeat of Iraq, the continued Jeffrey W. Wright, Lieutenant Colonel, US Army, wrote this essay while assigned as a National Defense University Research Fellow and student at the National War College. 3 JEFFREY W. WRIGHT rise of the Pacific Rim nations, and the maiden voyage of the European Community beginning in 1992. An issue central to this coming debate is to what extent intelligence resources, especially those of the Depart- ment of Defense, should be used to support and protect commerce. Intelligence in Support of Commerce The idea of using intelligence to support commerce cer- tainly tests moral, political, and practical waters. William Safire, writing in The New York Times, has raised the central issue: In the bipolar thaw, allies will be spying on us: should we be spying on them? For example, is it in America's interest to know the status of Japan's investment in biotech, as To- kyo hires scores of consultants to learn ours-or is this a form of industrial policy we should declare immoral and illegal?' If we assume that Japan, Britain, France, the USSR, and other nations will not hesitate to marshal the full assets of their governments, including intelligence assets, to support their national economic vitality, should the United States not do likewise? Espionage and intelligence collection are primary tools in the economic portfolios of many nations, both friends and foes. According to Senator David Boren, chairman of the Senate Select Committee on Intelli- gence, economic espionage is on the rise: If you doubt that we are shifting from military competition primarily to economic competition, look at the targets for foreign intelligence operations. It's very interesting, but as the arms race is winding down, the spy race is heating up. And where is the growth .-- in this espion'ge activity? Not by foreign companies, but by foreign governments. It's against private commercial targets in the United States. More and more the increase in espionage is to steal our 4 INTELLIGENCE AND ECONOMIC SECURITY commercial secrets for the sake of national economic pur- poses, as opposed to the theft of military secrets to build military strengths relatively in other countries.2 Let us further assume that the promotion of commerce as well as the control of commerce is a government func- tion. Government ought, therefore, to apply all legally available resources to the end of promoting commerce; it would be in the national interest to do so. The authors of Megatrends 2000 dearly make that assumption, writing, "In the Global Economy, economic considerations almost al- ways transcend political considerations." And they con- clude, "It is now clear that the 1980s was the decade when economics became more important than ideologies."3 So- viet President Gorbachev must be numbered among those who endorse such a "global economy." As the world economic order changes, countries such as Japan are competing economically under different rules than the United States follows while competing on the same field. A totally level playing field or 'free market' in world commerce is mythical. Each nation tries to tilt the playing field in its favor. Japan had a $49 billion dollar trade surplus with the United States in 1989-some of it the result of playing by different economic rules interna- tionally and keeping its economy relatively closed nation- ally.4 Because the United Staces has not yet begun playing by Japanese rules, US industries are failing to keep pace with Japanese in product innovations, productivity, and quality, especially in the automobile industry. This failure contributes further to the trade imbalance. Japan is nonetheless a friendly country and a very important ally. It has reacted to just criticism of its markets being closed to foreign products, of documented cases of product dumping, and of predatory business practices by reaching a 1990 trade agreement with the United States, which if honored will be a major step toward improving trade between the key Pacific trade partners.5 Because 5