Borderlands - Geographical Flash Points

In his book “The Next 100 Years”, George Friedman presents the concept of borderlands.  A borderland is a region that lies between two or more countries that have legitimate ethnic, religious, geographic, or historical claims to sovereignty over it. 

Borderlands are important because of the tension created when multiple countries compete for influence over them.  These tensions have contributed to some of the most famous wars in history.  Examples of some famous borderlands are Alsace-Lorraine between France and Germany and Kashmir between Pakistan, India, and China. 

Alsace-Lorraine:

Alsace-Lorraine has been a catalyst for multiple Franco-German wars, including WW1 and WW2.  It is the province that lines the border between France and Germany in Western Europe.  Geographically, it is on the west (French) banks of the Rhine River.  Ethnically, it is mixed with the majority belonging to Alsatians, who are a Germanic tribe.  It also has a long history of belonging to various French Kingdoms or German Reich’s and switched between France and Germany four times between 1870 and 1945 alone.

Kashmir:

Located mainly in the Himalayas where the borders of India, China, and Pakistan intersect, Kashmir is a borderland whose ownership has yet to be resolved.  Primarily Muslim, the residents of Kashmir have a deep affinity with Pakistan.  The conflict comes because Kashmir has historically been a Muslim princedom as a part of India.  Parts of the region have also been ruled by Tibet, which is now under Chinese control.  It is also located in the Himalaya Mountains.  This makes that territory key to the defense of all three countries.  In the past fifty years, multiple wars have been fought between all three countries over control of this territory.  These conflicts are currently unresolved with only Pakistan and China coming to an agreement on the borders (which India disputes). 

Conclusion:

The concept of a borderland is important to understand because there are several borderlands in existence in the world today.  Each has the potential to cause conflicts between its neighbors.  I will be investigating each of these borderlands in detail in future posts.

The Flawed Comparison: Korean and German Reunification

The death of Kim Jong Il earlier this week has set off a firestorm of speculation in the news as to the future of North Korea.  Featuring prominently in this speculation is the thought that this may be the first step toward Korean reunification, with comparisons often made to German reunification in 1990.

A quick analysis of German and potential Korean reunification shows that this comparison may not be as accurate as it first appears.  Korea and Germany have major geographic, political, and economic differences that make potential Korean reunification more complex and, potentially, combustible.

Cold War Similarities:
After WW2, Korea and Germany were occupied by the Allied forces: Germany because it initiated the war in Europe and Korea because it was the base that Japan used to make war in China.  Both countries were then divided along borders that roughly corresponded to where the US and Soviet armies met at the end of the war.  The US then setup a democratic society with a market based economy in its zones and the Soviets a Communist society with a planned economy in its zones.  During the Cold War, both countries then saw the US occupied zones far outstrip their Communist rivals in almost every major economic category.

German Reunification:
German reunification took place during the general collapse of the Soviet Union.  This collapse led to the removable of Soviet influence throughout most of Eastern Europe and included revolutions in most of Germany’s neighbors (Poland, Czechoslovakia, and Hungary).  Once the Berlin Wall fell, the two Germanys signed a treaty that amounted to a corporate takeover of the East by the West.  

As a result, modern day Germany is a democratic society with an open economy.  It also carries a significant amount of debt (83% of GDP in 2010) that it inherited during the merger 20 years ago.

Geographical Challenges:

Unlike Germany, Korea was not an active participant in WW2.  It simply had the bad luck to be geographically located between two of the warring powers: China and Japan.  This makes Korea geographically more similar to Poland or Belgium than to Germany.  It is sandwiched between two rival powers, each of whom has a long history with the other and a strong incentive to control it.  This incentive has not disappeared, so as long as Japan and China are both strong, Korea will be caught in a geographical tug-of-war.

Political Challenges:

Unfortunately for Korea, modern Japan and China are both strong global powers.  They have the 2^nd and 3^rd largest economies in the world and the rivalry that led to the Asian theatre of WW2 is starting to re-emerge.  Both countries therefore have a stake in controlling Korea (or at least denying the other control of it).  This will complicate any attempt at Korean reunification since Japan is a South Korean ally and China a North Korean ally. 

Economic Challenges:
When Germany reunified, the West was substantially larger and wealthier than the East.  It had four times the population (62M to 16M), and a per capita GDP that was 50% higher ($15.3K to $9.7K).  Despite the massive and wealthy population that it could draw upon to fund the reunification, Germany is still suffering economically from the unification 20 years later.

Korea’s differences in population and GDP paint a far different story.  South Korea is more populous and wealthy than the North, but the differences are not as favorable as Germany’s were.  South Korea’s population is twice the North’s (49M to 24M) and its per capita GDP fifteen times larger ($31.7K to $1.9K).  Korean reunification would therefore require a tremendous transfer of wealth from South to North.  This would result in a significant change in lifestyle for the South Koreans and could cripple the unified Korean economy for much longer than the 20 year impact that Germany has seen.

Conclusion:
The analogy to German reunification may be an easy one when looking at the regime change in Korea, but it ignores many of the complexities that Germany did not have to face.  It is therefore difficult to imagine a situation where quick reunification takes place without having dramatic and possibly combustible, consequences for the region.

China - The Road to Being a Superpower

Over the past decade, China has had one of the world’s most dynamic economies.  It now has the 2^nd largest economy in the world and is widely considered to be the next global superpower. 

Unfortunately for China, it has some severe geopolitical challenges to overcome on its quest to become a superpower.  These challenges are South Korea, Japan, and Taiwan.  All three countries have the geographical, historical, and political incentive to act as barriers to China’s rise to global dominance.

Geography of China:

China’s land borders in Asia are among some of the most secure in the world.  To the south lie the steaming jungles of Indo-China.  As the US found during the Vietnam War, these jungles are easily defended and essentially impassable for invaders.  The Himalaya Mountains and Gobi Desert then act as barriers that run all along the southern, western, and northern borders.  These land barriers protect almost all of China and leave its maritime borders as the only borders that are exposed.

China’s Naval Challenges:

In order to secure its maritime borders, China needs to dominate the peninsula and islands that lie off of its eastern coast.  Unfortunately, China does not control this area.  Instead, the Korean Peninsula is divided between North and South Korea, the Island of Taiwan is controlled by the Republic of China, and the Ryukyu Islands and Japanese Archipelago is controlled by Japan.

Historical Perspective:

During WW2, Japan used its colonies in Korea and Taiwan to invade mainland China.  It then proceeded to conquer the area highlighted in lime green before being defeated by the US. 

After WW2, the People’s Republic of China and the Republic of China engaged in a civil war for control of the mainland.  This civil war ended with the Republic of China being exiled to Taiwan, where it still resides today.  This war is technically still unresolved.

Korea exited WW2 divided into North and South Korea.  In 1950, North Korea tried to unify the peninsula by invading South Korea.  This started the Korean War, which ended in a stalemate when the US intervened on behalf of the South and China on behalf of the North.  This war is also technically unresolved.

Conclusion:

The memories of Japan’s WW2 invasion are why the eastern border is so critical to China.  It is also why the issue of control over Taiwan and the separation of North and South Korea are so important to the foreign policy of China.  This policy will naturally conflict with the sovereignty of South Korea, Japan, and the Republic of China.  All three countries are modern nations with strong militaries and, more importantly, are close military allies of the US.  This is why they are uniquely positioned to act as barriers to China’s rise as a superpower.

Iran: Similarities to the German Empire

From 1871 to 1914, the German Empire was an emerging nation that disrupted the status quo in Europe.  This disruption was caused by Germany pursuing its geographical, economical, and political imperatives at the expense of its neighbors. 

In many ways, I see modern day Iran as being similar to the German Empire.  It has many of the same imperatives that Germany did and I see great potential for Iran to disrupt the status quo in the Middle East like Germany did in Europe.

The German Empire:

Germany’s actions from 1871 to 1914 were a result of its history, geography, and population demographics. 

1.  From the 900’s to the late 1700’s Germany, as the Holy Roman Empire of the German Nation, was the dominant power on the European continent.

2.  Germany’s most lucrative economic regions (the Ruhr River Valley, Silesia, and Alsace-Lorraine) were located on borders with hostile powers.

3.  Germany’s population had recently experienced rapid growth to become one of the largest in Europe.  It also contained a large number of minority populations (French in Blue, Polish in Yellow, Lithuanian in Orange).

Iran’s Prestigious History:

Iran also has a prestigious imperial past.  In Iran’s case, this past came in the form of the Persian Empire, which dominated the Middle East two thousand years ago.  Since that time, many smaller versions of the Persian Empire have emerged to dominate parts of the Middle East.  The individual dynasties are not as important as the fact that Iran has a very long and prestigious past of dominating the Middle East.

Iran’s Economic Driver:

Like many countries in the Middle East, Iran is rich in oil.  It possesses the 3^rd largest estimated oil reserves and 4^th largest proven reserves in the world.  It also exported close to 2.4M barrels of oil per day in 2010.  This resulted in 2010 oil exports of close to $78B or 85% of the country’s total exports. 

These reserves are mostly located on Iran’s western border with Iraq and Kuwait or in the Persian Gulf.   The oil fields (in black) also fall on the western side of the Zagros Mountains, which act as natural barriers for Iran.  This puts the economic region in Iran right on the exposed border of hostile neighbors.

Iran’s Demographics:

Over the past 60 years, Iran’s population has more than tripled from approximately 20M in 1950 to approximately 73M in 2010.  This has resulted in Iran having a large, but very young population.  In 2010, it was estimated that almost two-thirds of Iran’s population was under the age of 30. 

This population also contained a large number of ethnic minorities.  Ethnic Persians (green) made up approximately 61% of the Iranian population with Kurds (blue), Lurish (red), and Baloch (yellow) making up sizeable minorities.  Many of these minorities are also located close to the oil rich western border that was discussed above.

Conclusion:

With the US now pulling out of Iraq, there will be a power vacuum on Iran’s western border.  Iran is highly motivated to protect this border.  This defensive motivation may lead Iran to take bold action to secure its oil wealth and stabilize potential civil unrest in its population.

Iran is in a pattern that is similar to the one followed by the 19^th and early 20^th century German Empire.  It will be interesting to see if Iran follows this pattern to its logical conclusion and invades its neighbor Iraq like Germany did with Russia and France.

What's in the news? 11/16/2011

I was checking the news today during lunch and a few of the headlines caught my eye. Since those headlines pertained to the topics that I plan on writing about in this blog, I thought I'd share my thoughts on them.  I will be doing this from time to time, in addition to stated objective of this blog.

Monti Becomes Italy's New PM:
This headline has been across various websites in one form or another.  What strikes me is not that Italy has a new Prime Minister, but how it happened?  Silvio Berlusconi resigned as Prime Minister last week and, rather than holding elections, Monti was simply given power.  This is the exact same story (with different names) that happened in Greece a few weeks ago.  Current Prime Minister runs into disfavor with European leadership.  Current PM resigns and recommends successor from industry (European Central Bank for the new Greece PM and European Union ministry for new Italian PM).

There are two things about these transitions that strike me as odd:
  1.  No elections were held.  The new PM simply took over in both cases.  While I am no expert in European parliamentary democracy, I find it rather curious that the leadership of the country could pass from one PM to another with no vote so quickly.  It almost reminds me more of the type of situation that you would see in a corporation instead of in a country.  The corporation is failing and its balance sheet is a mess, so the Board of Directors (France and Germany) fire the CEO and his LT and appoint a new leadership team.
2.  Both of the new PM's came from the European Community instead of from the government of Italy or Greece.  This just reinforces my theory from #1 that both leaders really brought in by the EU.  If this is the case, it will be interesting to see what happens in these two countries in the next few months or years.  Running a country with the best interests of the EU in mind is very different than running a country with the best interests of its citizens in mind.  I'm very interested to see if/when this starts to become a problem and how it impacts European nationalism, which has long been stifled.

Greek PM Wins Vote of Confidence:
Another headline that has been everywhere and has been taken to mean that the Greek people are backing new PM Papademos's agenda of adopting the strict austerity measures required by the EU. 

My take: I think that Greece will continue to do what it has been doing since it joined the EU.  Its leaders will continue to make loud noises about adopting the measures required by the EU (as evidence by the 255 to 38 vote) while the citizens continue to riot and fight to maintain the status quo.  The only difference is that this time Greece can longer afford to say one thing and do another.  In order to avoid a default and possibly being kicked out of the EU, Greece needs its citizens to change its ways. 

Speaking frankly, I don't see this happening.  The Greek citizens are being asked to make sacrifices for the betterment of Europeans from other countries and at the behest of leaders who were brought to power by the EU leadership from those countries.  Instead, I see a power struggle between the citizens and the government.  In that type of situation, the public always wins (just wikipedia the following "The <insert country here> Revolution" for proof).

Italy to Adopt Austerity Measures:
Ok, so maybe this one wasn't a headline everywhere.  It was, however, a key point in many of the articles about the new PM Monti and his agenda.

My interest in this falls on one very specific part of Italy: South Tyrol. (see below picture from the South Tyrol wikipedia page)


My interest in this region is for one specific reason: it isn't Italian.  For those of you who aren't familiar with Tyrol, its German.  75% German (as of the 2010 census) to be exact.  It was annexed by Italy after WW1 as a part of the deal that Italy made for switching sides to fight Germany during the war.   This annexation took place to push the Italian-Austrian border further into the Alps so that it was easier for Italy to defend.  Prior to that, it was a part of the Austrian Empire for hundreds years.

Delving deeper into South Tyrol (again using only the wikipedia page), you can find that the Germans living their have cut themselves a pretty sweet deal as a result of this annexation.  South Tyrol is able to maintain 90% of all levied taxes as compensation for living in a country that they have no ethnic tie to. 

This is the part of South Tyrol that really interests me.  Will South Tyrol be included in the Italian austerity measures (increasing government revenue is a way to address the debt issue after all)?  If that happens, how will the Germans living in South Tyrol respond?  Will they all of the sudden remember that until 1972 they had claimed to be Austrian (or that until 1992 Austria had claimed them)?  Will they look at the financial policies in Germany and Austria (both much more similar to South Tyrol in terms to per Capita GDP that most of Italy is) and find something that appeals to them?

If the answer to any of the above questions is "Yes", then we could see some very interesting times as Italy implements its austerity programs.  My prediction: South Tyrol becomes a major flash point for nationalism in the near future and causes major issues for the EU.

Welcome

Welcome to Geopolitics: A Business Case!  The intent of this blog is to use the data analysis methods that I learned at engineering and business schools to answer global political questions. 

In my future posts, I will be demonstrating why many of what appear to be random or ill-intentioned actions make perfect sense when viewing the economic and geographic imperatives of the countries involved.

I will be satisfied if this blog is allow me a forum to present my views regarding the world or domestic news in a structured manner. I will be pleased if any readers deem my views worth discussing and wish to engage in some constructive debate. I will be thrilled if anyone reads this blog and walks away thinking "I hadn't considered looking at it that way before."

I hope that you enjoy this blog as much as I will enjoy writing it.