Ten lessons from history on the dos and don’ts of analyzing political risk
Our baffling new multipolar world grows ever more complex, desperately calling for new ways of thinking, particularly when it comes to political risk. To Dare More Boldly provides those ways, telling the story of the rise of political risk analysis, both as a discipline and a lucrative high-stakes industry that guides the strategic decisions of corporations and governments around the world. It assesses why recent predictions have gone so wrong and boldly puts forward ten analytical commandments that can stand the test of time.
Written by one of the field's leading practitioners, this incisive book derives these indelible rules of the game from a wide-ranging and entertaining survey of world history. John Hulsman looks at examples as seemingly unconnected as the ancient Greeks and Romans, the Third Crusade, the Italian Renaissance, America's founders, Napoleon, the Battle of Gettysburg, the British Empire, the Kaiser's Germany, the breakup of the Beatles, Charles Manson, and Deng Xiaoping's China. Hulsman makes sense of yesterday's world, and in doing so provides an invaluable conceptual tool kit for navigating today's.
To Dare More Boldly creatively explains why political risk analysis is vital for business and political leaders alike, and authoritatively establishes the analytical rules of thumb that practitioners need to do it effectively.
Ten lessons from history on the dos and don’ts of analyzing political risk
Our baffling new multipolar world grows ever more complex, desperately calling for new ways of thinking, particularly when it comes to political risk. To Dare More Boldly provides those ways, telling the story of the rise of political risk analysis, both as a discipline and a lucrative high-stakes industry that guides the strategic decisions of corporations and governments around the world. It assesses why recent predictions have gone so wrong and boldly puts forward ten analytical commandments that can stand the test of time.
Written by one of the field's leading practitioners, this incisive book derives these indelible rules of the game from a wide-ranging and entertaining survey of world history. John Hulsman looks at examples as seemingly unconnected as the ancient Greeks and Romans, the Third Crusade, the Italian Renaissance, America's founders, Napoleon, the Battle of Gettysburg, the British Empire, the Kaiser's Germany, the breakup of the Beatles, Charles Manson, and Deng Xiaoping's China. Hulsman makes sense of yesterday's world, and in doing so provides an invaluable conceptual tool kit for navigating today's.
To Dare More Boldly creatively explains why political risk analysis is vital for business and political leaders alike, and authoritatively establishes the analytical rules of thumb that practitioners need to do it effectively.
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Overview
Ten lessons from history on the dos and don’ts of analyzing political risk
Our baffling new multipolar world grows ever more complex, desperately calling for new ways of thinking, particularly when it comes to political risk. To Dare More Boldly provides those ways, telling the story of the rise of political risk analysis, both as a discipline and a lucrative high-stakes industry that guides the strategic decisions of corporations and governments around the world. It assesses why recent predictions have gone so wrong and boldly puts forward ten analytical commandments that can stand the test of time.
Written by one of the field's leading practitioners, this incisive book derives these indelible rules of the game from a wide-ranging and entertaining survey of world history. John Hulsman looks at examples as seemingly unconnected as the ancient Greeks and Romans, the Third Crusade, the Italian Renaissance, America's founders, Napoleon, the Battle of Gettysburg, the British Empire, the Kaiser's Germany, the breakup of the Beatles, Charles Manson, and Deng Xiaoping's China. Hulsman makes sense of yesterday's world, and in doing so provides an invaluable conceptual tool kit for navigating today's.
To Dare More Boldly creatively explains why political risk analysis is vital for business and political leaders alike, and authoritatively establishes the analytical rules of thumb that practitioners need to do it effectively.
Product Details
| ISBN-13: | 9781400889440 |
|---|---|
| Publisher: | Princeton University Press |
| Publication date: | 04/03/2018 |
| Sold by: | Barnes & Noble |
| Format: | eBook |
| Pages: | 344 |
| File size: | 2 MB |
About the Author
Read an Excerpt
CHAPTER 1
480 BC: Introduction
THE FIRST POLITICAL RISK ANALYSTS: THE PYTHIA OF DELPHI
The Pythia as the World's First Political Risk Consultant
In 480 BC, the citizens of Athens found themselves in more trouble than the modern mind can imagine. Xerxes, son of Darius the Great of Persia, King of Kings, King of the World, had some unfinished business left to him by his all-powerful father. A decade earlier, at the Battle of Marathon in August 490 BC, the impossible had happened. The little-regarded Athenian army had seen off Darius and his mighty horde, saving the fragile city-state from certain destruction. Now Xerxes had invaded the Greek mainland again, to finish what his father had started.
Judging by his past record, the Athenians knew better than to expect mercy from the great king. Upon ascending the throne, Xerxes had savagely crushed two rebellions by portions of his empire then thought to be infinitely superior to the little city-state that was Athens. In 484 BC, Xerxes had quashed a revolt in Egypt, devastating the Nile delta. Soon after, he decisively put down efforts to throw off his yoke in Babylon, going so far as to pillage the sacred Babylonian temples. Xerxes was a man who saw every form of dissent assacrilege; the Athenians knew they could expect no quarter from the Persian king should they fail.
Just to make sure that this time Athens did not escape the wrath of the Persian Empire, Xerxes assembled the largest invading force the world had ever seen. While the Greek historian Herodotus — typically exaggerating — put the Persian numbers at 5 million, modern-day historians still place them at an overwhelming 360,000, with a gigantic armada of 700 to 800 ships in support of this vast host.
Confronted with almost certain annihilation, what did the Athenian leadership do? What was their response to a problem that in terms of both its size and its likely devastating impact seemed insurmountable?
Simple. They requested the services of the world's first political risk consultant.
The Pythia Masters the Persians
By 480 BC, the Pythia of Delphi already amounted to an ancient institution. Commonly known now as the Oracle of Delphi (when in fact the "oracles" were the pronouncements the Pythia dispensed), the Pythia were the senior priestesses at the Temple of Apollo, the Greek God of Prophecy.
The temple, sitting precariously (and beautifully — the site is still a wonder to behold) on the slope of Mount Parnassus above the Castalian Spring, had long been the center of the Greek world, going back into the mists of time. The site may well have had religious significance as early as 1400 BC, during the forgotten days of the Mycenaeans, with devotions to Apollo being established in the eighth century BC. Delphi remained a center of worship until 390 AD, having been in use for at least 1,100 years.
During this long period, the Pythia was seen as the most authoritative and important soothsayer in Greece. Pilgrims descended from all over the ancient world to visit the temple and have their questions about the future answered. Sitting in a small, enclosed chamber at the base of the edifice, the Pythia delivered her oracles in a frenzied state, most probably imbibing the vapors rising from the clefts of Mount Parnassus.
We know a good deal about how the oracles came to pass. For a time during the period of Roman domination, the Greek historian Plutarch served as high priest at Delphi, assisting the Pythia in her mission. Perched above the major cleft in the rock, the Pythia would be sitting in a perforated cauldron astride a tripod. It was reported by pilgrims that as the Pythia imbibed the vapors rising from the stone her hair would stand on end, her complexion altered, and she would often begin panting, with her voice assuming an otherworldly tone, not quite human. In classical days, it was asserted that the Pythia spoke in rhyme, in pentameter or hexameter.
To put it in modern terms, there is little doubt that the Pythia did see visions and underwent a dramatic transformation while in the temple; she was clearly as high as a kite. Plutarch himself believed that her oracular powers were directly associated with the vapors that emanated from the Kerna spring waters that flowed underneath the temple, vapors that may well have been full of hallucinogenic gas.
We now know that two tectonic plates intersect beneath Mount Parnassus; such a fault line creates many crevices in the earth, through which gases can rise. Recent tests have found ethylene in the spring water near the site of the Temple of Apollo. It is the most likely cause of the Delphic prophesies.
Ethylene is characterized by its sweet smell and produces a narcotic effect described as floating or disembodied euphoria. As described in detail by Plutarch, the experiences of the Pythia in action match the effects of ethylene. Under the influence, a person's tone of voice alters and speech patterns change, yet they retain the ability to answer questions logically. With exposure to higher doses of the drug, the person thrashes about wildly, groaning in strange voices, frequently falling to the ground, all behaviors tracking with eyewitness accounts of the Pythia's behavior.
The Greeks believed that Apollo possessed the Pythia's spirit when she was delivering her oracles — a point at which she was intoxicated by the vapors. They saw her prophecies as religious in nature, but let's look at them afresh. For I think the Temple at Delphi amounts to nothing less than the world's first political risk consulting firm.
At least since the days when the Athenians consulted the Pythia during the height of the Persian Wars, political and business leaders have looked to outsiders blessed with seemingly magical knowledge to divine both the present and the future. While the tools of divination have changed through the ages, the pressing need for establishing rules of the road to manage risk in geopolitics have not. The question remains: through superior knowledge (either intellectual or spiritual in nature), can we reliably do this?
During the period of the Pythia's ascendance, pilgrims brought animals to Delphi for sacrifice to Apollo, as well as a monetary fee for the privilege of using the Pythia's services. Of the petitioners who waited for the one day of the month the Pythia deigned to reply to their questions, those who brought larger donations to the god secured an advanced place in line. Political risk has always been a business that directly links analysis to monetary rewards.
And since the days of the classical Greeks, such special knowledge and policy advice have always been essential for governments and businesses, as well as individuals. At the time of the Battle of Salamis in Greece, no expedition was undertaken, no new colony established, and no major event involving distinguished individuals went by without the Pythia being consulted.
The Pythia (three of them were "on call" at any one time) gave advice to shape future actions, practical counsel that was to be implemented by the questioner. This is exactly what political risk analysts still do today, though we'd use modern jargon and call it "policy" in the public sphere and "corporate strategy" in the business world. But what the Pythia was doing is recognizably the same thing my political risk firm does today, save for the substance abuse.
Given the pharmacological basis for the Pythia's special insights, it is amazing how good a political risk record the priestesses actually had. Between 535 and 615 of the oracles have survived to the present day, and well over half of them are said to be historically correct. I can name a goodly number of modern firms that would kill for that record, high or not.
Crucially, on the biggest political risk question Delphi was ever presented with — the invasion of Xerxes — the Pythia came through with flying colors. When the Athenians first asked the Pythia what to do, she gave them the foreboding reply: "Drown your spirits in woe." In other words, there was nothing to do, as Xerxes was unstoppable.
When persuaded to see them a second time, the Pythia outlined a policy that would provide the Athenians with a way to practically escape from their impending doom. She recounted that when Athena — the Greek Goddess of Wisdom and the patron of her namesake city — implored her father Zeus, the King of the Gods, to save her city, Zeus replied that he would grant that "a wall of wood shall be uncaptured, a boon to you and your children."
Back in Athens, Themistocles, the paramount Greek leader in their fractious democracy, successfully argued that a wall of wood specifically referred to the Athenian navy, and he persuaded the city's leaders to adopt a maritime-first strategy. This policy — concocted by the Pythia and put into concrete action by the decision-maker Themistocles — led directly to the decisive naval Battle of Salamis, the turning of the tide that brought about the end of the Persian risk to Athens's survival. To put it mildly, the Pythia had proven to be well worth her political risk fee.
The Merits of History
Geopolitical risk analysis is an increasingly sexy topic today, striding like a colossus athwart the arenas of global business, international relations, and the general public, all beguiled by its siren song of making sense of both the present and the future in our uncertain new age. But for all the hoopla, there has been precious little written about how practical rules of the game can be applied to managing risk in geopolitics, and even less on the core components, or elements, that comprise this latest attempt at soothsaying.
This book, following in the footsteps of the unimaginably bold prayer that opens it, attempts to do this, using the potent brew of political realism, geopolitics, and historical analysis (particularly relating to lessons learned from history and the relevance of historical analogies), as these analytical tools remain vitally important for understanding our perplexing contemporary world. Such a historical analysis can help lay bare the rules of the road as to how leaders ought to deal with geopolitical risk. For there has not been a good fusion of historical analysis to the study of international relations since Dr. Kissinger was in his heyday.
Kissinger, particularly in A World Restored and Diplomacy, was a master at developing an operational set of realist-inspired maxims, based on his historical analysis, for decision-makers to use in generally interpreting the geopolitical world around them. However, much of his thinking was unsurprisingly rooted in the bipolar era of the Cold War of his time, and then in the brief unipolar moment following on from the demise of the Soviet Union. With the dawn of our new multipolar age — following the dual calamities of the Iraq War and the Lehman Brothers Great Recession — new thinking along these highly productive lines is very necessary. For this creative rules-of-the-road approach, based on rock-solid historical analysis, remains a neglected aspect of contemporary thought about international relations.
Before forging on, here is what I and To Dare More Boldly will not do. This book is not an exploration of realist theory (I have written a book on this topic already), another salvo in the endlessly tired fight between history and political science (despite my strong views on this); neither is it a literature review of what has gone on recently in the field of political science.
Instead, the undervalued and enduring relevance of history for formulating a successful interpretation of contemporary international politics will be a central theme, both for corporate entities grappling with geopolitical risk and for political actors combating simplistic foreign policies and the decision-makers who all too often now are propagating them. Specifically, this book will put forward a rules-ofthe-game approach (based on historical analysis) to mastering geopolitical risk or any other risks that impact the national interest or the politics (domestic and international alike) that impact foreign policy and strategic considerations of policymaking.
This rules-of-the-game historical approach has been a neglected aspect of political risk analysis generally and geopolitical analysis more specifically (of which it is a vital sub-set). The strength of the method lies in avoiding the otherworldly models of political science and instead remaining grounded in the empirical realities of a real world we have already experienced as fact.
While there is much truth in the assertion that there are multiple variables that have gone into every single major historical occurrence and output across time, it is well we should not get bogged down in the infuriating, self-perpetuating nihilism of post-modernism, for lessons can still be truly learned from the world as we have lived it and definitive statements made about them.
Some lessons from history truly are self-evident. Waterloo genuinely was a disaster for Napoleon. The Great Depression did not help European democracies of the 1930s cope with extremism. Franklin Roosevelt was a more successful politician than Jimmy Carter. I have little time and less patience for the cottage industry of post-modernists in the academy who say that nothing true or universal can be learned from history or from intellectual thought in general.
The real-world, commonsense way out of this seeming intellectual thicket is to accept that history does have universal and applicable lessons to teach us, but that any analyst's use of history to assert such maxims for outlining a rules-of-the-game approach to the study of risk in geopolitics should be held to the highest analytical standards. While there may be many other perfectly applicable interpretations of the events that analysts chronicle, their specific interpretation of any event must at a bare minimum be highly plausible.
While there certainly will be other alternate historical analytical points to be made about all the eras and historical instances we recount in To Dare More Boldly, that is not the point. The point is: do the historical lessons learned and analogies I draw on work to illuminate, buttress, and underline the rules of the game I propound for dealing with risk in geopolitics?
The historical analogies and interpretations employed in To Dare More Boldly must work in highlighting and underlining broader, more universal maxims that can apply to understanding and managing geopolitical risk in a more general way. If they do, and if the maxims hold across time and space, then all is well and I can leave alternate assessments of all these historical eras and events to others to work on. If they do not, then I have failed.
But there is much to be gained by using this historical approach to more deeply understand contemporary international politics. In employing the historical lens — looking at real-world, empirical, historical examples of good and bad performance in the face of geopolitical risk across time — these analogies strikingly highlight a specific, more universal set of rules of the game for understanding geopolitical risk in our contemporary era. The hope is that these rules of the road — underlined and amplified by the use of copious historical analogies — can help today's decision-makers be better able to deal with geopolitical risk, while underpinning a "do's and don'ts" list — ten commandments of geopolitical risk that transcend time and space and help make sense of the multipolar world we now happen to live in.
Finally, such a historical approach to understanding risk in geopolitics simply allows us to learn from hindsight, much as individual humans attempt to do every day. Each chapter of To Dare More Boldly will use a variety of historical examples as it underlines a specific element — a "commandment"— of this larger rules-of-the-game approach to mastering risk in geopolitics. The chapters are grouped around specific elements of both what geopolitical risk analysis is and what it must not be. By the time we reach the end of our tale, having looked in detail at the specific factors that go into mastering risk in geopolitics, it will be possible to determine the nature of the beast we have been thinking about.
The benchmarks for assessing geopolitical risk involve geography, history, and time. The study of geopolitics — the assessment of how geography affects a country's foreign policy over its history — is an essential part of the larger intellectual toolbox of political risk analysis because, as was true of the Pythia, modern geopolitical risk analysts dare to think that there are broadly fixed rules to foreign policy analysis, discernible patterns of history that make human endeavor broadly predictable over time. George Friedman, a major modern geopolitical risk thinker, defines geopolitics as "the craft of understanding the forces at play well enough to generally predict where we are going."
(Continues…)
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Table of Contents
Chapter 1 480 BC: Introduction-The First Political Risk Analysts: The Pythia of Delphi 1
The Pythia as the World's First Political Risk Consultant 1
The Pythia Masters the Persians 2
The Merits of History 6
A Potted History of the Modern Political Risk Business 11
Hans Morgenthau, Realism, and Modern Geopolitical Risk 27
Brian Wilson and Greek Attributes 31
Back to the Past of the Pythia's Lair to Glean the Future of Geopolitical Risk Analysis 36
Chapter 2 31 AD: We Are the Risk; The Decline and Fall of the Roman Empire 42
Edward Gibbon and How Political Risk Analysts Think 42
The Rise of Sejanus and the Fall of the Roman Empire 46
An Avoidable Tragedy in France and the Root Cause of Europe's Decline 49
Europe's Ticking Demographic Time Bomb 52
Karl-Theodor zu Guttenberg and Germany's Distrust of Success 56
The Sudden End of Europe's Sunny Way of Lire 59
The Political Naiveté of Lying about Europe's Gloomy Future 61
Rome Dies from Within 65
Chapter 3 1192 AD: Gaming Out Lunatics; The Assassins and the Old Man of the Mountain 68
The Old Man of the Mountain Demonstrates What Power Actually Is 68
Rashid ad-Din Sinan and the Benefits of Being Seen as Crazy 70
The Elusive Madness of Charles Manson 73
The Method of ISIS's Madness 78
Sinan Bests Saladin 84
Sinan Bests the Crusaders 86
Chapter 4 1503 AD: Gaming Out Chess Players; Machiavelli, Cesare Borgia, and Pope Julius II 92
Machiavelli Attempts a Comeback 92
Machiavelli Backs the Wrong Horse 95
Cesare Borgia's Overrated Bond Villain Luster 99
Washington and Hamilton as Chess Players 103
Washington's Farewell Address as Geopolitical Strategy 108
Julius Runs Rings around Borgia 112
The Prince with Julius as Hero 115
The Analytical Riches That Come from Spotting Chess Players 119
Chapter 5 1776: Everything to Play For; John Adams and Game-Changers 121
Adams Sees the Future, Jefferson Buys Gloves 121
The Political Miracle of the Fourth of July 124
Churchill Rejoices over Pearl Harbor 132
Hitler's Fatal Error 138
The Declaration of Independence as Improbable Game-Changer 141
The Limits to Even Adams's Sagacity 145
Chapter 6 1797: Getting to Goldilocks; Napoleon and the Venetian Republic 147
The Dangers of Analytical Overreaction 147
Venice's Slow Castration 149
Manin Goes Out with a Whimper 151
Napoleon's France as a Country on Military Steroids 155
Bonaparte's Predictable Fall as a Leader of a Revolutionary Power 161
The Benefits of Balance 165
Chapter 7 1863: The Losing Gambler Syndrome; Robert E. Lee at Gettysburg 167
Why Casino Magnates Get Rich: Gettysburg and Vietnam 167
Joshua Lawrence Chamberlain Saves the Union 168
The United States Tragically Doubles Down in Vietnam 174
Lee Fatally Goes for Broke with Pickett's Charge 181
The Losing Gambler Syndrome as Beguiling Analytical Trap 187
Chapter 8 1895: Knowing Your Country's Place in the World; Lord Salisbury Saves the British Empire 188
The Analytical Imperative of Seeing the World as It Is 188
Salisbury's Intellectual Courage in Confronting His Changing World 189
The Merits of Off-shore Balancing 193
The Meiji Restoration Saves Japan 197
The Genro Face the World 201
Salisbury Finesses America over the Venezuelan Crisis 203
Salisbury Saves His Country, Long after His Death 207
Chapter 9 1898-1912: The Promised Land Fallacy; Von Tirpitz Disastrously Builds a Navy 209
The Dangerous Mirage of the Promised Land Fallacy 209
Von Tirpitz Recklessly Challenges British Naval Dominance 210
Khrushchev and the Limits of Brinkmanship 217
Khrushchev's Ill-Fated "Wars of National Liberation" Strategy 223
The Haldane Mission as the End of Tirpitz's Promised Land 229
Chapter 10 1970: Knowing the Nature of the World You Live In; Or the Trials and Tribulations of George Harrison 233
The Imperative of Understanding Time in the Analytical Equation 233
The Beatles' System Falls Stunningly Apart 234
The Rise of George Harrison 236
The Rolling Stones Regroup 238
The Fall of Brian Jones 239
The Beatles as a Frightening Metaphor for Today's World 246
How the West Can Avoid the Beatles' Fate 250
The Analytical Imperative to Closely Track Changes in Systems 251
Chapter 11 1978: The Butterfly Effect in Political Risk; Or Deng Xiaoping and the Perils of a Drunken Sea Captain 254
Mastering Real-World Bolts from the Blue 254
Deng Xiaoping Crafts China's Successful Mercantilist Foreign Policy 256
Deng Survives Mao and Transforms China 259
Macmillan Salvages Britain's Place in the World 268
The Present Tinderbox in the Waters Surrounding China 274
Today's Asia as 1914 279
History Is Never Finished 283
Chapter 12 Conclusion: Back to the Pythia's Lair; Mastering Geopolitical Risk 284
Can the Future Be Foretold? 284
Kenneth Waltz and the Systemic Realism Underlying Geopolitical Risk Analysis 284
"Know Thyself as the Base of the Geopolitical Risk Analysis Typology 287
"Nothing in Excess" as a Branch of the Geopolitical Risk Analysis Typology 292
"Make a Pledge and Mischief Is Nigh" as a Branch of the Geopolitical Risk Analysis Typology 297
The End of the Pythia and the Beginning of Political Risk Analysis 303
Acknowledgments 305
Bibliography 307
Index 313
What People are Saying About This
"Hulsman combines first-rate historical storytelling with extremely sophisticated political analysis—you can actually imagine him sitting in the room with the great strategists of the past. To Dare More Boldly is a brilliant and unusual book that rips up conventional thinking on the major events of world history."—James Frayne, author of Meet the People: Why Businesses Must Engage with Public Opinion to Manage and Enhance Their Reputations
"Written by one of political risk’s most entertaining, original, and mischievous thinkers, To Dare More Boldly is the ultimate guide to understanding where the world is now and predicting its future."—Tom Welsh, Daily Telegraph
"To Dare More Boldly is a monument to Hulsman’s vast erudition. In this captivating book, he examines what has gone wrong throughout history and uses those insights to formulate a general set of lessons for those who have to assess political risk—and for all of us to better judge the foreign-policy decisions of our leaders."—Teun van Dongen, Inholland University of Applied Sciences
"John Hulsman travels across history and culture to illustrate the ten rules for analyzing political risk. He deploys the Roman Empire, Crusades, Vietnam War, and even the Beatles to help business and political leaders avoid disaster in today’s increasingly complicated and unstable world."—Doug Bandow, Cato Institute
"John Hulsman dares more boldly to tell the 2,500-year journey of political risk management from the Oracle of Delphi to the age of Trump. This lively jaunt through history is a cracking read for all and offers unique insights for those of us who must navigate the uncertainties of political risk. This groundbreaking work is must reading for anyone who hopes to lead through the complexity of today’s geopolitics."—Robert H. Kahn, Automated Financial Systems
"As the world careers deeper and deeper into unpredictability, John Hulsman reminds us that it is still possible to foresee an uncertain future by learning from the past. Some of history’s most famous figures—including Tiberius, Napoleon, and Cesare Borgia—failed the analytical test, while scarce-remembered figures such as the Old Man of the Mountain and Lord Salisbury passed it. Through more than two millennia, Hulsman brings to vivid life the tenets of successful analysis: know your history, and know yourself."—Ben Nimmo, Atlantic Council Digital Forensic Research Lab
"A serious, profound, and well-researched book."—Lucio Caracciolo, LUISS Guido Carli, Rome