July 1, 2007

Ratcheting Up Security

With a globalized economy comes serious security risks that can't be ignored.

On Sept. 11, 2001, 19 men armed with box cutters hijacked four planes and shattered the belief that the United States was secure behind its oceanic borders. That day also put a spotlight on the very real security risks that attend globalization. How the U.S. balances the benefits and risks of a globalized economy is a crucial question facing the leaders of industry.

Globalization has ebbed and flowed over the centuries. From Marco Polo and the great Silk Road, to Queen Victoria and the British Empire, great surges in the exchange of goods, money, information and people have had extraordinary impacts on the course of history.

When the Soviet Union collapsed in the early 1990s, globalization filled the vacuum left behind by the East/West conflict. The old economic spheres of influence gave way to the powerful forces of market integration, liberalization, and revolutions in transportation and information.

While globalization has raised the standards of living for millions of people around the world, it also has its limitations. In the late 1990s, the protests in Seattle showed there was much grassroots resistance to the changes that accompany globalization. And in places where the infrastructure of modern markets—roads, rail, ports, banks, credit, communications—was absent, entire populations found themselves left behind.

In the most disconnected areas, failed states, exclusion and resentment combined with extreme ideologies to create a Petri dish for terror. What emerged—al-Qaida—has used a radical, twisted ideology mixed with resentment of globalization and its infrastructure to inflict wrath. Exploiting this “dark side” of globalization has enabled al-Qaida to expand its network and sell its nefarious message.

The tools al-Qaida uses are simple but powerful. The Internet serves to inspire, recruit, train and command. Global financial networks send money around the world—9/11 cost al-Qaida only $500,000. Modern passenger travel and visa waiver programs make infiltration possible. Once, these kinds of tools were only available to governments and multinational corporations. Today, non-governmental actors can have global reach. It was not an Arab army that attacked America in 2001; it was 19 post-graduate students.

Like any modern venture, al-Qaida has an agile structure that allows it to operate in a highly competitive environment. “Holy War Inc.” has a board of directors, venture capital, franchisees and branding. Indeed, in their own words, Osama bin Laden is known as “the Contractor,” terrorist attacks are “the Trade,” Western intelligence services are “Foreign Competitors” and the Taliban is known as “The Omar Brothers Trading Co.”

So it is not surprising that a sophisticated, adaptable organization has a multi-pronged strategy. Not only does al-Qaida have a military strategy to kill and scare its enemies, but it is also pursuing an economic jihad. That strategy entails attacking soft targets that hold significant economic value, such as trains, planes and oil facilities.

Bin Laden himself has said his strategy is “bleeding America to the point of bankruptcy.” On that initial investment of $500,000, the attacks of 9/11 cost the U.S. an estimated $500 billion in the economic aftermath and an enormous number of lost jobs.

And they know how to exploit opportunity. After helping to defeat the Soviet Union in Afghanistan, bin Laden realized a protracted military engagement in a far-off land can drain its enemy’s treasury. Al-Qaida’s operations in Iraq have contributed to that goal. Taking advantage of our strategic failure to plan for the post-invasion period, al-Qaida has sought to crank up the sectarian hostilities, keeping us tied down at an incredible military and political cost.

Many economic vulnerabilities remain. Forty-one percent of U.S. trade goes through 361 seaports, valued at $139 billion per year. Sixty-two percent of our oil arrives by sea. Nine million shipping containers enter those same ports each year. And our sea-borne trade is expected to double over the next 20 years. All in all, 20% of the economy relies on trade.

So it is not surprising that the [nonprofit think tank] RAND Corporation estimates that a 10-kiloton nuclear detonation at the Long Beach seaport near Los Angeles would cost the U.S. economy more than $1 trillion. The Congressional Budget Office estimates that a smaller attack, such as a dirty bomb or conventional truck bomb that closed down Long Beach, would cost the U.S. $65 million to $150 million of GDP per week. In such a strategic environment, we must ask if we are doing enough and doing it smartly. The answer is no.

The forces of globalization cannot be totally reversed, but we should be doing much more to manage its currents and to improve the United States’ competitive advantages. Moreover, we need to build up our homeland security capabilities to manage our most dangerous risks and modernize our 20th century infrastructure. To do that, I believe we need our nation’s leaders in the public and private sectors to do many things. I will talk about three.

First, we must improve our government’s efforts to protect the homeland. The Department of Homeland Security was created and pieced together almost as poorly as the post-invasion plan for Iraq. DHS must recruit, train and retain competent career professionals committed to the right amount of government providing the right kind of security. Congress must also consolidate and streamline the oversight process for DHS. Under the existing structure, more than 80 committees and subcommittees oversee the department—too much oversight can be as bad as too little.

Second, we need to build a layered homeland security strategy. Secure ports of entry, secure transportation networks and fully funded and interoperable law enforcement are the three main layers of that strategy—and all are lacking. To make that happen, Congress needs to take the pork out of homeland security grants to states and insist that DHS set minimum standards in all three areas.

Finally, we need to work creatively and cooperatively with industry. More than 85% of our infrastructure is owned and operated by the private sector. Public/private partnerships are essential to securing our chemical plants, nuclear power facilities and food supply, to name a few. Working with DHS and local first responders to develop plans and share best practices is essential.

The challenge before the U.S., however, is to innovate and change like it did after World War II. We must be prudent in anticipating and defending against al-Qaida. But we must also be stewards of new ideas.

We must work to shape the powerful force of globalization and align it with our highest principles and a vision of global opportunity. If we take these two steps in tandem, our own prosperity will be ensured and hope will prevail for our future.

Tim Roemer is president of the Center for National Policy in Washington, D.C. He served on the 9/11 Commission. The Democratic Congressman served six terms in the U.S. House of Representatives, representing his South Bend, Indiana, district.