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Dr. David Glancy discusses economic and financial elements of national security

David Glancy October 2015 444x718On October 21, 2015, The Institute of World Politics hosted a lecture with Dr. David Glancy on the elements of economics and finance within national security. This lecture was part of a series on Economics and Foreign Policy sponsored by the Charles Koch Foundation.

Dr. Glancy began by emphasizing how important it is to examine the relationship between national security, economics, and finance, especially considering the lack of scholarship on the matter. Not only is there a lack of crossover between these seemingly disparate elements, there is also a lack of understanding of the tools of economic statecraft and warfare. Compared to other major players such as China and Russia, the U.S. often finds itself underfunded and underprepared in these areas.

Economic strength is vital to national security, and the current debt and deficit are major security concerns, Dr. Glancy continued. If these issues are not addressed in the near future, the debt (and interest payments) could sharply reduce the amount of discretionary spending available to support our defense and national security requirements. Dr. Glancy noted that increased economic growth could help lower the debt/deficit but that political leaders would also need to make wise decisions to head off this looming problem.

Dr. Glancy stressed the importance of vigilance and awareness among leaders of the warning signs of international debt and financial crises. Falling into a debt or financial crisis is disastrous to the populace of the country affected by the crisis and he noted that these crises can have important foreign policy and national security ramifications.  Contagion can spread the crisis to other countries which can in turn increase instability, and often refugee flows and cross-border tensions. Additionally, leaders rarely blame their own policies as the cause of the crisis, but instead find external threats on which to blame the failings of the economy (with capitalism and the United States often being the primary scapegoats).  

A major concern that Dr. Glancy highlighted was how many countries in the EU cut back on defense spending prior to the economic crisis in 2007-2008. When the crisis hit, it exacerbated these existing trends, and now we see the effects on the general readiness of the militaries in Europe.  He noted that this is unlikely to change in the near future and will have important implications for working with allies and partners in the future.  

Dr. Glancy also took issue with the general perception of economic statecraft as consisting of nothing but sanctions and aid. There needs to be more focus, he argued, on the importance of trade, as trade and economic interests can have wide range of effects on national interests and policy. Increased trade can provide benefits for all parties but there is a danger for small countries to become too reliant on one major trading partner, especially if that partner is comfortable using economic warfare to further their foreign policy goals. 

In closing, Dr. Glancy emphasized that there is a great need to increase education and understanding of the tools in this realm of national security, economics and finance. This includes an awareness of how the private sector can be leveraged to support foreign policy and national security objectives as well as understanding the legal and economic tools within the scope of the federal government that are available to policymakers.