Economic warfare

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Economic warfare or economic war is an economic strategy used by belligerent states with the goal of weakening the economy of other states. This is primarily achieved by the use of economic blockades. [1] Ravaging the crops of the enemy is a classic method, used for thousands of years.

Contents

In military operations, economic warfare may reflect economic policy followed as a part of open or covert operations, cyber operations, information operations [2] during or preceding a war. Economic warfare aims to capture or otherwise to control the supply of critical economic resources so friendly military and intelligence agencies can use them and enemy forces cannot.[ citation needed ]

The concept of economic warfare is most applicable to total war, which involves not only the armed forces of enemy countries, but also mobilized war-economies. In such a situation, damage to an enemy's economy is damage to that enemy's ability to fight a war. Scorched-earth policies may deny resources to an invading enemy.

Policies and measures in economic warfare may include blockade, blacklisting, preclusive purchasing, rewards and the capturing or the control of enemy assets or supply lines. [3] Other policies, such tariff discrimination, sanctions, the suspension of aid, the freezing of capital assets, the prohibition of investment and other capital flows, expropriation, and debasing the target's currency by counterfeiting. [4] [5] even without armed military war, may constitute economic warfare.

History

Crusades

In his Book on the Recovery of the Holy Land, Fidentius of Padua provides prescriptions for economic warfare to be waged against the Mamluk sultanate of Egypt in furtherance of the Crusades. He envisions a fleet of 40–50 galleys to enforce a blockade on trade between Europe and Egypt. He sees this trade as helping Egypt in two ways: from Europe it obtains war materiel (iron, tin, timber, oil) and from Asia dues on goods brought in via the Red Sea for trade to Europe. If this spice trade were deflected from the Red Sea to Mongol Persia, Egypt would be deprived of customs duties and would also lose export markets because of the reduction in shipping. This may also make it unable to afford more slave soldiers imported from the Black Sea. [6]

American Civil War

Union forces in the American Civil War had the challenge of occupying and controlling the 11 states of the Confederacy, a vast area larger than Western Europe. The Confederate economy proved surprisingly vulnerable. [7]

Guerrilla warfare in the American Civil War was supported by a large fraction of the Confederate population that provided food, horses, and hiding places for official and unofficial Confederate units. [8] The Union response was to ravage the local economy, as in the Burning Raid of 1864. Before the war, most passenger and freight traffic moved by water through the river system or coastal ports. Confederate railroads were already inadequate and suffered much damage. Travel became far more difficult. The Union Navy took control of much of the seacoast and the main rivers such as the Mississippi River and the Tennessee River, using the Mississippi River Squadron of powerful small gunboats. Land transportation was contested, as Confederate supporters tried to block shipments of munitions, reinforcements and supplies through West Virginia, Kentucky, and Tennessee to Union forces to the south. Bridges were burned, railroad tracks torn up, and telegraph lines were cut. Both sides did the same and effectively ruined the infrastructure of the Confederacy. [9] [10]

Union soldiers destroying telegraph poles and railroads in Georgia, 1864 F.O.C. Darley and Alexander Hay Ritchie - Sherman's March to the Sea.jpg
Union soldiers destroying telegraph poles and railroads in Georgia, 1864

The Confederacy in 1861 had 297 towns and cities with a total population of 835,000 people, 162 of which were at one point occupied by Union forces with a total population of 681,000 people. In practically every case, infrastructure was damaged, and trade and economic activity was disrupted for a while. Eleven cities were severely damaged by war action, including Atlanta, Charleston, Columbia, and Richmond. The rate of damage in smaller towns was much lower, with severe damage to 45 out of a total of 830. [11]

Farms were in disrepair, and the prewar stock of horses, mules, and cattle was much depleted; 40% of the South's livestock had been killed. [12] The South's farms were not highly mechanized, but the value of farm implements and machinery in the 1860 census was $81 million and had been reduced by 40% by 1870. [13] The transportation infrastructure lay in ruins, with little railroad or riverboat service available to move crops and animals to market. [14] Railroad mileage was located mostly in rural areas and over two thirds of the South's rails, bridges, rail yards, repair shops, and rolling stock were in areas reached by Union armies, which systematically destroyed what they could. Even in untouched areas, the lack of maintenance and repair, the absence of new equipment, the heavy overuse, and the relocation of equipment by the Confederacy from remote areas to the war zone ensured the system would be ruined at war's end. [15]

The enormous cost of the Confederate war effort took a high toll on the South's economic infrastructure. The direct costs to the Confederacy in human capital, government expenditures, and physical destruction totaled perhaps $3.3 billion. By 1865, the Confederate dollar was worthless because of high inflation, and people in the South had to resort to bartering for goods or services to use scarce Union dollars. With the emancipation of the slaves, the entire economy of the South had to be rebuilt. Having lost their enormous investment in slaves, white planters had minimal capital to pay freedmen workers to bring in crops. As a result, a system of sharecropping was developed in which landowners broke up large plantations and rented small lots to the freedmen and their families. The main feature of the Southern economy changed from an elite minority of landed gentry slaveholders to a tenant farming agriculture system. The disruption of finance, trade, services, and transportation nodes severely disrupted the prewar agricultural system and forced Southerners to turn to barter. The entire region was impoverished for generations. [16]

World War I

The British used their greatly-superior Royal Navy to cause a tight blockade of Germany and a close monitoring of shipments to neutral countries to prevent them from being transshipped to there. Germany could not find enough food since its younger farmers were all in the army, and the desperate Germans were eating turnips by the winter of 1916–17. [17] [18] US shipping was sometimes seized, and Washington protested. The British paid monetary compensation so that the American protests would not escalate into serious trouble. [19]

World War II

Clear examples of economic warfare occurred during World War II when the Allied powers followed such policies to deprive the Axis economies of critical resources. The British Royal Navy again blockaded Germany although with much more difficulty than in 1914. [20] The US Navy, especially its submarines, cut off shipments of oil and food to Japan.

In turn, Germany attempted to damage the Allied war effort via submarine warfare: the sinking of transport ships carrying supplies, raw materials, and essential war-related items such as food and oil. [21] As the Allied air forces grew, they mounted an Oil campaign of World War II to deprive Germany of fuel.

Neutral countries continue to trade with both sides. The Royal Navy could not stop land trade, so the allies made other effort to cut off sales to Germany of critical minerals such as tungsten, chromium, mercury and iron ore from Spain, Portugal, Turkey, Sweden and elsewhere. [22] Germany wanted Spain to enter the war but they could not agree to terms. To keep Germany and Spain apart, Britain used a carrot-and-stick approach. Britain provided oil and closely monitored Spain's export trade. It outbid Germany for the wolfram, whose price soared, and by 1943, wolfram was Spain's biggest export-earner. Britain's cautious treatment of Spain brought conflict with the more aggressive American policy. In the Wolfram Crisis of 1944 Washington cut off oil supplies but then agreed with London's requests to resume oil shipments. [23] [24] Portugal feared a German-Spanish invasion, but when that became unlikely in 1944, it virtually joined the Allies. [25]

Cold War

During the Malayan Emergency (1948–1960), the British military deployed herbicides and defoliants in the Malaysian countryside (including crop fields) in order to deprive Malayan National Liberation Army (MNLA) insurgents of cover, potential sources of food and to flush them out of the jungle. The herbicides and defoliants deployed by the British contained Trioxone, an ingredient which was also formed part of the chemical composition of the Agent Orange herbicide used by the U.S. military during the Vietnam War. Deployment of herbicides and defoliants served the dual purpose of thinning jungle trails to prevent ambushes and destroying crop fields in regions where the MNLA was active to deprive them of potential sources of food. Herbicides and defoliants were also sprayed from Royal Air Force (RAF) aircraft. [26]

On 17 November 1953, the Greek National Intelligence Service (KYP) proposed conducting tax audits on suspected communist book publishers and cinema owners, censoring Soviet movies and promoting Soviet films of particularly low quality. In 1959, KYP launched exhibitions of Soviet products in Volos, Thessaloniki and Piraeus. The bulk of the products were cheap and defective, purposefully selected to tarnish the Soviet Union's image. [27]

During the Vietnam War, between 1962 and 1971, the United States military sprayed nearly 20,000,000 U.S. gallons (76,000 m3) of various chemicals – the "rainbow herbicides" and defoliants – in Vietnam, eastern Laos, and parts of Cambodia as part of Operation Ranch Hand, reaching its peak from 1967 to 1969. For comparison purposes, an olympic size pool holds approximately 660,000 U.S. gal (2,500 m3). [28] [29] [30] As the British did in Malaya, the goal of the U.S. was to defoliate rural/forested land, depriving guerrillas of food and concealment and clearing sensitive areas such as around base perimeters. [31] Samuel P. Huntington argued that the program was also a part of a general policy of forced draft urbanization, which aimed to destroy the ability of peasants to support themselves in the countryside, forcing them to flee to the U.S.-dominated cities, depriving the guerrillas of their rural support base. [32] [29] [33]

French Economic Warfare School

Christian Harbulot, the director of the Economic Warfare School in Paris, provides an historical reconstruction of the economic balance of power between states. In his study, he demonstrates that the strategies that states put in place to increase their economic power and their impact on the international balance of power can be interpreted only by the concept of economic warfare. [34]

Economic sanctions

The Covenant of the League of Nations provided for military and economic sanctions against aggressor states, and the idea of economic sanctions was regarded as a great innovation. [35] However, economic sanctions without military ones failed to dissuade Italy from conquering Abbysinia.

In 1973–1974, the oil-producing Arab states imposed an oil embargo against the United States, United Kingdom, Canada, South Africa, Japan, and other industrialized countries that supported Israel during the Yom Kippur War of October 1973. Results included the 1973 oil crisis and a sharp rise in prices [36] but not an end to support for Israel.

Many United States sanctions have been imposed since the middle 20th century.

Fortress economics or a fortress economy is a phrase used in relation to the defense and sustenance of a countries' economy amidst international sanctions. [39] (The term has been used in reference to Russia in 2022, [40] [41] [42] Taiwan with relation to China-US relations, [43] [44] and Europe. [45] )

See also

Related Research Articles

<span class="mw-page-title-main">American Civil War</span> 1861–1865 conflict in the United States

The American Civil War was a civil war in the United States between the Union and the Confederacy, which was formed in 1861 by states that had seceded from the Union. The central conflict leading to war was a dispute over whether slavery should be permitted to expand into the western territories, leading to more slave states, or be prohibited from doing so, which many believed would place slavery on a course of ultimate extinction.

<span class="mw-page-title-main">Confederate States of America</span> Unrecognized state in North America (1861–1865)

The Confederate States of America (CSA), commonly referred to as the Confederate States (C.S.), the Confederacy, or the South, was an unrecognized breakaway republic in the Southern United States that existed from February 8, 1861, to May 5, 1865. The Confederacy was composed of eleven U.S. states that declared secession; South Carolina, Mississippi, Florida, Alabama, Georgia, Louisiana, Texas, Virginia, Arkansas, Tennessee, and North Carolina; they warred against the United States during the American Civil War.

<span class="mw-page-title-main">Operation Ranch Hand</span> 1962–1971 US herbicidal warfare operation in the Vietnam War

Operation Ranch Hand was a U.S. military operation during the Vietnam War, lasting from 1962 until 1971. Largely inspired by the British use of chemicals 2,4,5-T and 2,4-D during the Malayan Emergency in the 1950s, it was part of the overall herbicidal warfare program during the war called "Operation Trail Dust". Ranch Hand involved spraying an estimated 19 million U.S. gallons (72,000 m3) of defoliants and herbicides over rural areas of South Vietnam in an attempt to deprive the Viet Cong of food and vegetation cover. Areas of Laos and Cambodia were also sprayed to a lesser extent. According to the Vietnamese government, the chemicals caused 400,000 deaths. The United States government has described these figures as "unreliable".

<span class="mw-page-title-main">Blockade</span> Prevention of trade or movement by force

A blockade is the act of actively preventing a country or region from receiving or sending out food, supplies, weapons, or communications, and sometimes people, by military force. A blockade differs from an embargo or sanction, which are legal barriers to trade rather than physical barriers. It is also distinct from a siege in that a blockade is usually directed at an entire country or region, rather than a fortress or city and the objective may not always be to conquer the area.

The Canadian–American Reciprocity Treaty of 1854, also known as the Elgin-Marcy Treaty, was a treaty between the United Kingdom and the United States that applied to British North America, including the Province of Canada, New Brunswick, Nova Scotia, Prince Edward Island, and Newfoundland Colony. The treaty covered raw materials; in effect from 1854 to 1866, it represented a move toward free trade and was opposed by protectionist elements in the United States.

<span class="mw-page-title-main">Blockade runner</span> Merchant ship used to evade a naval blockade

A blockade runner is a merchant vessel used for evading a naval blockade of a port or strait. It is usually light and fast, using stealth and speed rather than confronting the blockaders in order to break the blockade. Blockade runners usually transport cargo, for example bringing food or arms to a blockaded city. They have also carried mail in an attempt to communicate with the outside world.

<span class="mw-page-title-main">War economy</span> Actions taken by a state to mobilize its economy for war production

A war economy or wartime economy is the set of contingencies undertaken by a modern state to mobilize its economy for war production. Philippe Le Billon describes a war economy as a "system of producing, mobilizing and allocating resources to sustain the violence." Some measures taken include the increasing of interest rates as well as the introduction of resource allocation programs. Approaches to the reconfiguration of the economy differ from country to country.

<span class="mw-page-title-main">Defoliant</span> Chemical sprayed or dusted on plants to cause its leaves to fall off

A defoliant is any herbicidal chemical sprayed or dusted on plants to cause their leaves to fall off. Defoliants are widely used for the selective removal of weeds in managing croplands and lawns. Worldwide use of defoliants, along with the development of other herbicides and pesticides, allowed for the Green Revolution, an increase in agricultural production in mid-20th century. Defoliants have also been used in warfare as a means to deprive an enemy of food crops and/or hiding cover, most notably by the United Kingdom during the Malayan Emergency and the United States in the Vietnam War. Defoliants were also used by Indonesian forces in various internal security operations.

Cotton diplomacy was the attempt by the Confederacy during the American Civil War to coerce Great Britain and France to support the Confederate war effort by implementing a cotton trade embargo against Britain and the rest of Europe. The Confederacy believed that both Britain and France, who before the war depended heavily on Southern cotton for textile manufacturing, would support the Confederate war effort if the cotton trade were restricted. Ultimately, cotton diplomacy did not work in favor of the Confederacy; as European nations largely sought alternative markets to obtain cotton. In fact, the cotton embargo transformed into a self-embargo which restricted the Confederate economy. Ultimately, the growth in the demand for cotton that fueled the antebellum economy did not continue.

<span class="mw-page-title-main">Agent Blue</span> Type of herbicide used in the Vietnam War

Agent Blue is one of the "rainbow herbicides" that is known for use by the United States during the Vietnam War. It contained a mixture of dimethylarsinic acid and its related salt, sodium cacodylate, and water.

<span class="mw-page-title-main">Union blockade</span> Union blockade of the Confederacy in the U.S. Civil War

The Union blockade in the American Civil War was a naval strategy by the United States to prevent the Confederacy from trading.

"King Cotton" is a slogan that summarized the strategy used before the American Civil War by secessionists in the southern states to claim the feasibility of secession and to prove there was no need to fear a war with the northern states. The theory held that control over cotton exports would make a proposed independent Confederacy economically prosperous, would ruin the textile industry of New England, and—most importantly—would force the United Kingdom and perhaps France to support the Confederacy militarily because their industrial economies depended on Southern cotton.

<span class="mw-page-title-main">Herbicidal warfare</span> Use of substances to destroy crops or other plants

Herbicidal warfare is the use of substances primarily designed to destroy the plant-based ecosystem of an area. Although herbicidal warfare use chemical substances, its main purpose is to disrupt agricultural food production and/or to destroy plants which provide cover or concealment to the enemy, not to asphyxiate or poison humans and/or destroy human-made structures. Herbicidal warfare has been forbidden by the Environmental Modification Convention since 1978, which bans "any technique for changing the composition or structure of the Earth's biota".

The Confederate States of America (1861–1865) started with an agrarian-based economy that relied heavily on slave-worked plantations for the production of cotton for export to Europe and to the Northern US. If classed as an independent country, the area of the Confederate States would have ranked as the fourth-richest country of the world in 1860. But, when the Union began its blockade of Confederate ports in the summer of 1861, exports of cotton fell 95% and the South had to restructure itself to emphasize the production of food and munitions for internal use. After losing control of its main rivers and ports, the Confederacy had to depend for transport on a delicate railroad system that, with few repairs being made, no new equipment, and destructive raids, crumbled away. The financial infrastructure collapsed during the war as inflation destroyed banks and forced a move toward a barter economy for civilians. The Confederate government seized needed supplies and livestock. By 1865, the Confederate economy was in ruins.

<span class="mw-page-title-main">Alabama in the American Civil War</span>

Alabama was central to the Civil War, with the secession convention at Montgomery, the birthplace of the Confederacy, inviting other slaveholding states to form a southern republic, during January–March 1861, and to develop new state constitutions. The 1861 Alabaman constitution granted citizenship to current U.S. residents, but prohibited import duties (tariffs) on foreign goods, limited a standing military, and as a final issue, opposed emancipation by any nation, but urged protection of African-American slaves with trials by jury, and reserved the power to regulate or prohibit the African slave trade. The secession convention invited all slaveholding states to secede, but only 7 Cotton States of the Lower South formed the Confederacy with Alabama, while the majority of slave states were in the Union at the time of the founding of the Confederacy. Congress had voted to protect the institution of slavery by passing the Corwin Amendment on March 4, 1861, but it was never ratified.

<span class="mw-page-title-main">Rainbow Herbicides</span> Herbicides used by the US in the Vietnam War

The Rainbow Herbicides are a group of tactical-use chemical weapons used by the United States military in Southeast Asia during the Vietnam War. Success with Project AGILE field tests in 1961 with herbicides in South Vietnam was inspired by the British use of herbicides and defoliants during the Malayan Emergency in the 1950s, which led to the formal herbicidal program Trail Dust. Herbicidal warfare is the use of substances primarily designed to destroy the plant-based ecosystem of an agricultural food production area and/or to destroy dense foliage which provides the enemy with natural tactical cover.

The United Kingdom of Great Britain and Ireland remained officially neutral throughout the American Civil War (1861–1865). It legally recognized the belligerent status of the Confederate States of America (CSA) but never recognized it as a nation and neither signed a treaty with it nor ever exchanged ambassadors. Over 90 percent of Confederate trade with Britain ended, causing a severe shortage of cotton by 1862. Private British blockade runners sent munitions and luxuries to Confederate ports in return for cotton and tobacco. In Manchester, the massive reduction of available American cotton caused an economic disaster referred to as the Lancashire Cotton Famine. Despite the high unemployment, some Manchester cotton workers refused out of principle to process any cotton from America, leading to direct praise from President Lincoln, whose statue in Manchester bears a plaque which quotes his appreciation for the textile workers in "helping abolish slavery". Top British officials debated offering to mediate in the first 18 months, which the Confederacy wanted but the United States strongly rejected.

<span class="mw-page-title-main">Environmental impact of the Vietnam War</span>

The Vietnam War had a major and long-lasting impact on the environment of the countries affected. The environment of Vietnam was severely degraded by the use of defoliants, bombing and other military activities. North Vietnam utilized the geography and ecology of the region to conceal their activities and move resources, such as via the complex network of tunnels and paths in the Ho Chi Minh trail. In response, the United States developed and deployed technologies and campaigns to clear forests and destabilize soil, greatly impacting the environment. Over time, the long-term Agricultural productivity in parts of Vietnam was reduced by many herbicidal agents and bombing campaigns. The war has also been linked to extensive deforestation and influenced the hydrology of the Mekong region.

The diplomacy of the American Civil War involved the relations of the United States and the Confederate States of America with the major world powers during the American Civil War of 1861–1865. The United States prevented other powers from recognizing the Confederacy, which counted heavily on Britain and France to enter the war on its side to maintain their supply of cotton and to weaken a growing opponent. Every nation was officially neutral throughout the war, and none formally recognized the Confederacy.

The economic history of the American Civil War concerns the financing of the Union and Confederate war efforts from 1861 to 1865, and the economic impact of the war.

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Further reading