Freedom of the Seas

One thing that the world takes for granted these days is the freedom of the seas. The open ocean is, generally, a pretty safe place. Well, it’s still the sea, which is inherently dangerous, but it’s not like there are pirates everywhere. While there are few pockets here and there, the world has never been so safe for International shipping.

The short reason why it’s so safe is that the US Navy makes it so. No other nation has the global reach that the US does. Thanks to the US being the world’s policeman cheap and secure International trade is possible. The free trade system that the US created after WWII also created huge trade deficits. Even so, it was worth it at the time. Deficits were less important than alliances, especially with the competition from the USSR.

To vastly over simplify, it worked. There is no longer a Soviet Communist threat. What’s one thing that generally happens to victorious militaries? They get downsized. When it comes right down to it, why maintain an expensive system to create alliances when they aren’t as important anymore. Without the strategic importance of free trade, why suffer the economic burden?

The recent trade war with China is a case in point. The US can survive a trade war better than China can. The US is still an industrial nation and can once again tool up to cover any Chinese shortfalls. China, on the other hand, needs export growth to provide jobs for a restless population. It’s less about money for China that it is about political stability. The long term domestic fall out for a trade war is much worse for China that the US. Why worry if the Straight of Malacca is open or not?

I was surprised to learn how much we’ve already pulled back from International commitments. It goes back to George W. Bush and continued through Obama. The pullback still continues. Don’t be distracted by the occasional deployment of military might here and there. The overall trend is downward.

One huge reason for maintaining open sea lanes was the US dependence on imported oil. Right now the United States can pretty much take care of itself using just North American resources. The rest of the world is going to have to scramble for energy, but the US is in a pretty good situation. Don’t be surprised if you eventually see things like European or Japanese ships escorting oil tanker convoys.

Some really basic things about the way the world works has quietly changed. Things will get interesting.

-Sixbears