In the twenty-first century, power is no longer in terms of military strength or territorial control. Instead, it is increasingly reliant on the capacity to shape the systems that make the global economy function. In Chokepoints: American Power in the Age of Economic Warfare, Edward Fishman makes a different case about American dominance in the 21st Century - that the United States has mastered a new type of dominance - a type based on control of both critical nodes of global finance, trade, and technology. These "chokepoints" give Washington pressure to its rival without the use of troops, changing international relations in subtle but powerful ways.
The Evolution of Economic Warfare
Economic warfare is not a new idea, but its scope and accuracy have been modified so largely. Fishman traces the path followed by the United States of America as it refined sanctions as a very targeted tool of statecraft. Instead of general trade embargoes, modern sanctions target specific sectors, institutions, or even people.
This shift has made economic pressure more effective and not as disturbingly destructive as actual warfare. By limiting the ability of an adversary to access capital, markets and financial services, the U.S. can undermine and eventually weaken. The resultant is a type of conflict that flows at a muted level, often behind the scenes, though has major political implications.
Financial networks are the instruments of power.
At the center of this system is the world financial network and at the center of this financial system is the U.S. dollar. Because most international transactions are based on systems using dollars, the United States has the unique position of influence. Fishman tells accounts of how this dominance grants American authorities the ability to peer and police financial flows long after their borders.
Banks and corporations all over the world often comply with the U.S. regulations, not because it is due to obligation but due to necessity. Losing access to dollar transactions can be a catastrophe: compliance is safer for those. This dynamic makes the financial system a strategic tool by which the U.S. can incorporate its policies on a world-wide basis without the need for direct confrontation.
Technology and Supply Chain Leverage
Beyond finance, on the side of technology and supply chains, another very important dimension of power is even created. The United States is the center of technology in some of our main industries - semiconductors, software, and state-of-the-art production systems. Such sectors are the backbone of modern economies.
Fishman points to the way that limiting access to these technologies can put a lot of brakes on competitors. Countries that are dependent on imported ingredients or intellectual property are at the mercy of disruption. This type of leverage is not only useful but it is most useful because it is aimed not at short-term stability but at long-term development, directing the future course of rival economies.
So, it is in Fishman's primary argument: that the places of real power today aren't so much over being the owners of resources, but rather determining who can access them and who cannot, who is allowed to have things and who is not. States present in the paths (financial, technological, or logistical) can affect the outcomes despite not exerting formal ownership and become the defining aspect of modern economic strategy in this way, chokepoints.
The Limitations of Chokepoint Power
Despite the effectiveness, this strategy has risks involved. Overuse of economic pressure may induce targeted countries to develop alternatives to U.S.-controlled networks, thereby lessening dependence on the U.S.-controlled networks. Efforts to circumvent the dollar or achieve independent supply chains are already unfurling based on American policies.
Fishman discusses fears of the long-term stability of the global system, as well. If economic instruments are viewed as political weapons, confidence in international institutions may disappear. This in turn could lead to fragmentation, where different competing blocs produce parallel systems instead of combining on common infrastructure.
It comes down to balance, and ultimately the sustainability of American power. Chokepoints provide us tremendous leverage but their misuse may speed up the transition that they are meant to slow down. The future of world order may depend on the precision of its exercise.
