Austerity, Economic Decline and Financial Weapons of War: A New Paradigm for Global Security
Mann, Eric Nickpeay
MetadataShow full item record
Since the collapse of the Soviet Union, America has emerged as the preeminent power in a unipolar international system. America’s vast economic resources, including the dollar’s role as the leading reserve currency and currency of choice for international trade transactions, has allowed for the development of unprecedented military power and diplomatic influence. America has used its influence to extend security guarantees to allies and to determine outcomes in regional disputes that concern America’s interests. America can intervene on behalf of states; form coalitions to target a rival; or take unilateral actions it determines are appropriate for national security matters. For most of the twentieth and twenty-first centuries, America’s grand strategy has been perceived as benign. Absent are the expansionist goals that defined previous dominant powers like Great Britain, France, and Germany. However, America’s more recent unilateral actions in Iraq and other foreign policy initiatives have challenged traditional norms of sovereignty, and are disconcerting to some states. These perceptions of American power are exacerbated by America’s role in the financial crisis of 2008 that led to the collapse of some foreign economies and the near collapse of financial markets worldwide. America’s escalating debt crisis has further eroded confidence in the post-war economic order and has raised grave concerns for America’s security commitments abroad. America’s ability to maintain the status quo is further complicated by the interdependencies resulting from globalization and technological advancement, which expose vulnerabilities that have potential global security implications. The new global security landscape defies traditional concepts of global security and instruments of war. In the 21st century, economic interests have replaced traditional military objectives and financial leverage is becoming the preferred weapon of choice to effect state behavior. This thesis uses case study analysis to determine the extent to which economic factors may contribute to global security threats. The research concludes that financial crisis experienced in states that possess weapons of mass destruction can contribute to proliferation risks. The research also supports the finding that reductions in the U.S. defense budget and reduced spending on foreign assistance programs will also produce security concerns in states dependent on this revenue stream to maintain security within their own borders. Lastly, the thesis identifies forms of economic soft balancing likely to be adopted by rival states and used against the United States to counterbalance its power. The advisors for this thesis were Professors Sarah O’Byrne, Jacob Straus and Rameez Abbas.