In 1960's, the genius Belgian economist, Robert Triffin presented a paper that outlined the existential paradox in having a single currency as a global reserve currency. This has since been famously referred to as the Triffin Dilemma. Simple in its logic but complex in practice, it essentially lays out that it is impossible for the host country to maintain an effective balance between its national financial policy and the global financial policy. For the US Dollar to be an attractive reserve currency, the US has to consistently run a current account deficit so that there are enough dollars in the market. However, this might be against its national financial policy as no country would prefer to run a deficit perpetually. On the other hand, if the US decides to limit the circulation of its currency to reduce current account deficit then there wont be enough supply of dollars which would lead to a liquidity crisis. It is impossible to maintain a rational balance between these two priorities.
Today, the powers that be face the same perplexity in trying to solve the problem of terror. Just take a look at the below infographic:
And the one below:
And the infographic below from http://www.visionofhumanity.org/:
The red ones show countries with terrorism problems. The Middle-east & Africa dominate by a fair degree.
Few connections are as obvious as the one between the above 3 infographics. The US, Russia, UK, France and Germany account for 72% of the world's export of major weapons betwen 2009-14. The middle-east and Africa account for 31% of these imports. According to the SIPRI Arms Transfers Database, Saudi Arabia was the 2nd largest arms importer for the period 2010-2014, accounting for 5% of world deliveries. The top 3 'customer' countries for the US between 2009-14 have been;
Do you see the obvious paradox? How do you maintain your commitment to fight terrorism when the same terrorism is netting you billions of dollars in revenue each year? Even though the issue of fighting global terrorism is more black and white than balancing your current account deficit, the conflict of interest is there for everyone to see. Do the powers that be focus on their national objective of maximizing GDP (which is easier to measure by the way) or the rather lofty objective of maintaining world peace? If you ask the concerned people, they'd say if we don't sell then somebody else will. It is better that we do. But that logic does not hold true at all in a globalized world.
Every year the world creates its own Frankenstein monsters which keep getting nastier and less remorseful.
In comparison the Triffin Dilemma looks like childs play. Apparently it is much more complex to solve the dilemma of choice between death and prosperity.
Today, the powers that be face the same perplexity in trying to solve the problem of terror. Just take a look at the below infographic:
And the one below:
And the infographic below from http://www.visionofhumanity.org/:
The red ones show countries with terrorism problems. The Middle-east & Africa dominate by a fair degree.
Few connections are as obvious as the one between the above 3 infographics. The US, Russia, UK, France and Germany account for 72% of the world's export of major weapons betwen 2009-14. The middle-east and Africa account for 31% of these imports. According to the SIPRI Arms Transfers Database, Saudi Arabia was the 2nd largest arms importer for the period 2010-2014, accounting for 5% of world deliveries. The top 3 'customer' countries for the US between 2009-14 have been;
Do you see the obvious paradox? How do you maintain your commitment to fight terrorism when the same terrorism is netting you billions of dollars in revenue each year? Even though the issue of fighting global terrorism is more black and white than balancing your current account deficit, the conflict of interest is there for everyone to see. Do the powers that be focus on their national objective of maximizing GDP (which is easier to measure by the way) or the rather lofty objective of maintaining world peace? If you ask the concerned people, they'd say if we don't sell then somebody else will. It is better that we do. But that logic does not hold true at all in a globalized world.
Every year the world creates its own Frankenstein monsters which keep getting nastier and less remorseful.
In comparison the Triffin Dilemma looks like childs play. Apparently it is much more complex to solve the dilemma of choice between death and prosperity.
