Issue Briefs

However, there are existential defense threats for which the nation is not prepared—existential in the sense that they could make the continued functioning of democratic government within U.S. borders nearly impossible.

These threats get short shrift in national strategy, either because they have never occurred before or because there are no easy remedies. Unfortunately, the vulnerability of the U.S. to the threats could make them attractive options for America’s enemies in the future.

February 3, 2020

Trivializing Impeachment

January 22, 2020- Issue brief by GPI President Paolo Von Schirach, The Democrats who hold the majority in the US House of Representatives did their best to present their vote leading to the start of an impeachment process, potentially leading to the removal of President Donald Trump from office, as a solemn and sad moment dictated by the gravity of the charges and the urgency of the constitutional crisis created by a criminal president.

January 22, 2020

Cyber War Happening Now – We Are Not Ready

January 16th, 2020- Issue Brief by GPI President Paolo Von Schirach, We are at war. Aggression which one day can take devastating dimensions is targeting America on a daily basis. I am talking about cyber warfare. Unfortunately, it is very hard to label cyber war as “war”, simply because it is vastly different from the “conventional war” we are used to study, discuss and prepare for.

January 16, 2020

Back to the economics of 1792

January 16th, 2020- Issue brief by GPI Fellow Martin Hutchinson, When William Pitt the younger made his great and optimistic Budget speech of 1792, he attributed Britain’s increased prosperity not to technological improvement but to the wealth-enhancing effect of the compounding increase in the country’s capital stock.

Only a generation later, in the administration of Robert, Earl of Liverpool, was technological change given credit for the country’s growth and prosperity. Today, as productivity growth slows or even halts, we may be returning to the economics of 1792, in which only capital increase brings greater wealth. This has uncomfortable implications.

Trump’s iconoclasm is a feature, not a bug

January 13th, 2019- Issue Brief by GPI Fellow Martin Hutchinson, Three years into his administration, President Donald Trump is subject to a surprising level of obloquy, given the U.S. economy’s benign performance. Not only his political opponents, but even some nominal “conservatives” want to impeach him. The reason is clear: rigid thinkers committed to the “icons” of past consensus policy loathe President Trump with unparalleled venom for breaking those icons.

January 13, 2020

Europe’s Dreams

January 13th, 2019- Issue Brief by GPI President Paolo Von Schirach, We heard from Ursula von der Leyen, the new President of the European Commission, that she will lead a “geopolitical” Commission. So, we are led to believe that, under her leadership, there will be deep thinking and strategizing about how to effectively combine the significant European economic, business, investments and military assets so that the EU will play a leading role on the world stage.

War With Iran?

January 10th 2020- Issue Brief by GPI President Paolo Von Schirach, The killing of General Qassem Soleimani, the legendary head of the Iranian al Quds force, is a game changer in America’s creeping hostilities with Iran. I wrote recently that unless the US wants to engage in a conflict over Iraq, this poor, war-torn country is lost to us, on account of the solid Iranian grip on it.

January 10, 2020

Brexit 2020

January 8th 2020- Issue Brief by GPI Senior Adviser Michael Binyon, at the end of this month, Britain is to leave the European Union, 47 years after it joined what was then the Common Market. It will be a shock – although long anticipated – for the other 27 members. No country has ever left the EU, and this spectacular no-confidence vote will test the hopes of the remaining members to stay committed and united.

January 8, 2020

Raising The Temperature In The Middle East

January 6th 2020- Issue brief by GPI President Paolo Von Schirach, After the unexpected airstrike that killed IRGC General Qassem Soleimani, right outside the Baghdad airport, analysts began speculating what Trump’s end game may be. In other words, is this just an ill-conceived, spur of the moment decision? Or is this targeted assassination of the master mind of all the Iran-led irregular forces operating with impunity in the Middle East part of a carefully orchestrated US “plan”?

January 6, 2020

Towards a Working-class Tory Britain

January 6th, 2020- Issue Brief by GPI Fellow Martin Hutchinson, By definition, all substantial election victories involve winning seats that had not previously been held. However, in this case, because of the interaction of the election with the Brexit decision, many industrial and mining constituencies in the north of England and north Wales, that had been Labour heartlands for generations, were taken by the Conservatives. By and large the big-city constituencies in the region remained Labour; it was the less concentrated urban areas, albeit still mining/industrial, that switched to the Conservatives. As one Labour leader said on the BBC’s Election Night program: “we haven’t lost the big city working classes, but we do seem to have lost the small-town working classes.”

Boris Johnson’s Gamble Will Fail

December 23rd, 2019- Issue brief by GPI President Paolo Von Schirach, Boris Johnson won the UK political elections –in a most spectacular way. Indeed, it seems that his new version of British Conservatism cum Populism upended British politics. Old Labour Party bastions, located primarily in the North of England fell, this way transforming the British political map. Congratulations on this splendid and unanticipated performance. This is the good news.

December 23, 2019

Good Values at the Root of Utah’s Success

December 12th, 2019- Issue brief by GPI President Paolo Von Schirach, A recent article pointed out how, year after year, Utah is on top of the national list of the best states to do business in America, not to mention that the state gets very high marks on good governance, while in Utah there is very low unemployment. And in Utah kids attending public schools on average do rather well compared to the rest of the U.S., notwithstanding the fact that in Utah spending per pupil is quite below the national average. Well, what is the secret of this success?

December 20, 2019

The Fake Aramco IPO

December 18th 2019- Issue Brief by GPI President Paolo Von Schirach, There were great expectations about the Aramco IPO. It was announced long ago by Saudi authorities, and then postponed several times. Well, now we know why it took so long, and why in the end the IPO did not take place in New York or London. Indeed, the Saudi government, the sole owner of this energy giant, could not be sure about the response of savvy international investors. Would they really buy shares at a price that implies an overall $ 2 trillion valuation for Aramco? May be not. And so the Saudis, decided to play it safe. They would do this at home, in an environment and with investors they could control. And so they used the Riyadh Tadawul stock exchange (where less than 200 stocks are traded) as the venue for this “historic” IPO.

December 19, 2019

Yale Model Goes Whiffen-Poof

December 12th, 2019- Issue brief by GPI Fellow Martin Hutchinson, All 60 of the United States’ leading university endowments underperformed a cheap “tracker fund” over the past decade, according to a study reported in the Financial Times. The culprit is the “Yale Model” of university endowment investment, whereby they focus on private equity, hedge funds and unquoted investments rather than on ordinary stock markets. From this data, the Yale Model clearly has not worked, at least in the last decade. It is worth examining what went wrong.

December 16, 2019

Stunning Victory for Boris Johnson, Yet Major Challenges Ahead

December 12th, 2019- Issue Brief by GPI Senior Adviser Michael Binyon, To the astonishment of pollsters and voters, Boris Johnson, Britain’s embattled prime minister, has won a resounding election victory, giving the ruling Conservative party their biggest majority for more than 35 years and ending three years of argument over Brexit. He now has a clear mandate for Britain to leave the European Union within the next six weeks.

How A Dangerous Court Ruling Could Give China The Lead In 5G Technology

December 12, 2019- Issue brief by GPI Senior Advisor Loren Thompson, Despite a chronic trade deficit in advanced technology products, the United States remains a global trendsetter for networking and telecommunications. U.S. companies are currently in a battle with Chinese state-influenced enterprises like Huawei that will determine whether American dominance continues into the era of 5G communications.

December 12, 2019

The Case for Gold Grows Ever Stronger

December 11th, 2019- Issue brief by GPI Fellow Martin Hutchinson, In 1982-2000, I avoided large losses by completely ignoring gold as an investment vehicle — I started thinking about it again when in July 2000 I noticed that Vanguard’s precious metals fund was its only loser over the preceding 5 years. Since 2008, I have invested consistently in gold mining stocks, and enjoyed good years (2009-10, 2016-19) and bad years (2011-15). Yet the intellectual case for gold, as a store of reality in an increasingly unreal world, grows stronger by the day. Let me explain

December 11, 2019

$22B Navy Contract Highlights Why GD’s Electric Boat Is One Of The Most Valuable Franchises In U.S. Defense

December 10, 2019- Issue brief by GPI Senior Advisor Loren Thompson, This week’s announcement that the Electric Boat unit of General Dynamics will receive the biggest shipbuilding contract in Navy history underscores the unique role that “EB” (as it is often called) plays in U.S. defense. The contract provides $22 billion for construction of nine Virginia-class attack submarines, an amount that could increase to $24 billion if the Navy exercises the option for a tenth sub.

This isn’t the first time Electric Boat has received the biggest naval shipbuilding contract ever. The $17 billion contract for the last “block” of Virginias, awarded in 2014, was also described at the time as unprecedented in size.

December 10, 2019

President Trump Should Offer to Sell M-1 Tanks to Poland

December 4th, 2019- Issue brief by Daniel Gouré, When Poland joined the NATO alliance in 1999, its military was saddled with rapidly obsolescing platforms and equipment largely of Soviet design. In response to the Russian seizure of Crimea and its massive military buildup, Warsaw initiated a major modernization program intended to provide its military with advanced capabilities. One key element of that effort is to upgrade or replace the Polish army’s fleet of old armored fighting vehicles, particularly its battle tanks.

December 5, 2019

Should Washington Sell The B-21 Bomber To Australia?

December 4, 2019- Issue brief by GPI Senior Advisor Loren Thompson, the U.S. Air Force is developing a long-range bomber that will be able to hold any target at risk, anywhere in the world. It is called the B-21 Raider, and will be the most survivable, versatile strike aircraft ever built. It is likely to eventually replace all the heavy bombers in the current U.S. fleet. On November 6, the Australian Strategic Policy Institute published an article in its journal The Strategist arguing that Australia should buy 12-20 B-21s from the United States. The article was written by senior analyst Marcus Hellyer, who convincingly laid out the geopolitical, operational and budgetary logic of such a move.

December 4, 2019

How Poor Countries can Beat De-Globalization

December 2nd, 2019- Issue brief by GPI Fellow Martin Hutchinson, The outstanding winners from the 1991-2016 policies of globalization were dwellers in poor countries. With international sourcing much cheaper and easier and foreign investment flows soaring, well-run poor countries could attract capital, jobs and export-producing industries in profusion, producing revenues that could educate their workforce and hugely raise their living standards. Overall, for poor countries, the world has now become harder. Yet even without globalization, well-run poor countries can still become middle-income and then rich.

December 2, 2019

After Decades Of Warnings, U.S. Gets Serious About EMP Dangers

November 21, 2019- Issue brief by Paul Steidler, For decades government policy experts and scientists have known about the dangers of electromagnetic pulse (EMP) events which could cripple large sections of the power grid for long periods of time. EMP disturbances occur naturally, through solar storms. They could also happen due to high-altitude nuclear bomb detonations or through on-the-ground attacks by terrorists or saboteurs.

November 21, 2019

Can Boris Johnson win the UK elections?

November 15, 2019- Issue brief by GPI Senior Adviser Michael Binyon, Not since 1923 has Britain held a general election in December – a month most politicians want to avoid as voters are more preoccupied with Christmas shopping than politics. But this time there was little choice: Boris Johnson’s government had lost its majority, Parliament was deadlocked over Brexit, splits and tensions were destroying both main parties, and voters had lost patience with the political wrangling and with all politicians. They will now have a chance to sweep out hundreds of MPs and vote for a whole range of different faces on December 12th.

November 15, 2019

Once It Gets Green Light From FAA, Boeing Still Faces Complicated Task To Get 737 MAXs Off The Ground

November 13, 2019- Issue brief by GPI Senior Adviser Loren B. Thompson, "Consider, for instance, the basic steps involved in returning the plane to service. First the Federal Aviation Administration (FAA) needs to approve a software update to the MCAS flight control system and a redesign of the plane’s twin flight control computers so that the MAX can be recertified as airworthy. Then the FAA needs to approve revised training requirements and supporting documents for crews who will be flying the plane. Then the grounding order is lifted, after which each carrier must submit proposed training programs to regulators for approval, training is conducted, and the MAX can finally begin carrying passengers again".

November 13, 2019

Congressional Dysfunction Threatens To Halt Trump Defense Buildup

November 11, 2019- Issue brief by GPI Senior Adviser Loren B. Thompson, Over the last several weeks, there has been growing concern on Capitol Hill that Congress might not pass a budget for the 2020 fiscal year that began October 1. When these situations arise, as they almost always do at the beginning of a fiscal year, government shutdown is averted by passing a Continuing Resolution (CR) that maintains prior-year spending levels into the new year.

November 11, 2019

The Anglosphere governance model is the Gold Standard

November 5, 2019- Issue brief by GPI Fellow Martin Hutchinson, Assuming Britain finally manages to edge its way out of the EU, it will look for other affiliations. The obvious choice is joining the core Anglosphere of the United States, Canada, Australia and New Zealand. At first sight, this may look like a model driven by mere nostalgia. Not so: the governance model of the Anglosphere is the best in the world, in terms of assuring the happiness and prosperity of its citizens. Thus, a loosely associated Anglosphere can serve as a global model.

November 5, 2019

If President Trump Isn’t Reelected, What Will That Mean For The Military?

November 4, 2019- Issue Brief by GPI Senior Adviser Loren B. Thompson, President Trump isn’t likely to be removed from office through the impeachment process. Even if every Democratic member of the chamber voted for removal in a Senate trial, 20 Republican senators would have to turn on Trump to expel him from office. That outcome looks exceedingly improbable today.

The more plausible scenarios for Trump’s departure would be either resignation or failure to win reelection. The president shows no sign of resigning, so next year’s election looms as the biggest opportunity for those who say the nation can’t stand another four years of Trump to seat a more congenial chief executive in the White House.

November 4, 2019

Towards a Low-Overhead 2020s

October 30, 2019- Issue Brief by GPI Fellow Martin Hutchinson, The Western world approaches the 2020s at the top of a boom, with asset prices and leverage at all-time highs and interest rates at all-time lows, yet with disappointing expectations when it comes to a higher standard of living. The extreme policies that have produced this state of affairs are unsustainable over another decade, even if we were mad enough to try. The solution will be unpleasant but inevitable: the overhead “fat” that has accumulated throughout the world economy must be eliminated — a process that will inevitably be painful.

October 30, 2019

Why Sell Weapons To Taiwan? Because Washington’s China Strategy Won’t Work Without It.

October 28, 2019- Issue Brief by GPI Senior Advisor Loren Thompson, Someday very soon the Republic of China, also known as Taiwan, will receive formal approval from Washington to move ahead with its biggest purchase of U.S. arms in many years. The package includes over a hundred M1A2 tanks, hundreds of surface-to-air and anti-tank weapons, and the first U.S. fighters Taipei has bought from America since 1992.

October 28, 2019

DoD Leaders’ Modernization Plans Will Require Rethinking How It Partners With Industry

October 21, 2019- Issue brief by Daniel Gouré, The Department of Defense (DoD) is on a mission to transform the way it acquires advanced military capabilities. Each of the Military Services has stood up a special organization expressly for the purpose of shortening the cycle time associated with developing and procuring new weapons systems and promoting innovation.

The U.S. Army has been boldest, creating a new four-star command, Army Futures Command (AFC), for the express purpose of speeding up all aspects of modernization. The aerospace and defense industry has a long history of operating special organizations devoted to pursuing innovative solutions to challenging technical and operational problems. Pratt & Whitney, one of the Nation’s premier developers of commercial and military aircraft engines, has responded to DoD’s imperative for rapid modernization by standing up its own innovation cell in Florida called GatorWorks. This new organization is already demonstrating the innovative thinking for which its military customers, particularly the Army and Air Force, are looking.

October 21, 2019

Turkey and the US: A Failed Alliance?

October 16, 2019 - Issue Brief by GPI Fellow Cenk Karatas: "In Syria, Turkey and the US may be paying the price of a failed alliance. Here is a fact: PYD is the Syrian wing of PKK, an internationally recognized terrorist organization, while YPG is the military branch of PYD. This is by no means a secret; and all US officials were obviously aware of it. Nonetheless, they cooperated with them for the sake of defeating ISIS in Syria."

October 16, 2019

What USTR And Boeing Want From Europe To End The Tariffs

October 14, 2019- Issue Brief by GPI Senior Adviser Loren B. Thompson, This week’s media coverage of the World Trade Organization’s decision to approve U.S. tariffs on European products in response to illegal subsidies of jetliners has followed a familiar pattern.

The dominant themes are that there are no winners in trade wars; that America and Europe both have legitimate complaints against how the other side’s aerospace sector has operated; and that the tariffs the U.S. Trade Representative (USTR) plans to impose later this month are part of a broader Trump Administration strategy to help American companies at the expense of foreign competitors.

October 14, 2019

Turkey’s Operation into Northeast Syria: Anything But Unexpected

October 9, 2019 - Issue Brief by GPI Fellow Cenk Karatas: During the war of Manbij against ISIS a few years ago, I remember asking a high level US security official about American engagement with the YPG (Syrian Kurdish forces) and whether they had made any promises to the Syrian Kurds in exchange for their participation in the fight against ISIS. The official’s response had a twist: "Superpowers don’t make promises, they just give hope."

October 9, 2019

The Blessed World of Low Asset Prices

October 2, 2019- Issue brief by GPI Fellow Martin Hutchinson, After a decade of ultra-low interest rates, we have become used to ultra-high asset prices – in big city real estate, stocks, bonds, tech start-ups, art and collectibles, and pretty well everything else you can think of. It is too depressing to think of the damage that will be done by the inevitable bursting of this universal bubble. Let us rather look forward to say 2030, to a world of low asset prices and historically average interest rates, and remind ourselves of that world’s advantages.

October 2, 2019

Five Reasons The Air Force’s Digital Century Series Is Doomed To Failure

October 1, 2019- Issue Brief by GPI Senior Adviser Loren B. Thompson, The Air Force has embarked on a revolutionary approach to aircraft, satellite and software development that it hopes will greatly compress the time required to bring major advances into the active force. Dubbed the “Digital Century Series” after a burst of early Cold War innovation, the new approach could reduce the time required to develop new combat aircraft to five years, with additional years of time saved in developing military spacecraft and major software advances.

October 1, 2019

Brexit Woes Continue in The UK

October 1, 2019- Issue Brief by GPI Fellow Graham Bardgett, Will U.K. Prime Minister Boris Johnson pull a rabbit out of his Magician’s hat and get a new deal from the EU? Or is he determined to drive on over the cliff edge using Emergency Powers to thwart the law?

A vote of no confidence in the UK Government aimed at replacing Boris Johnson as Prime Minister is imminent, the Westminster leader of the Scottish Nationalist Party Ian Blackford said Sunday 29 September. But its success relies, he said, on all opposition parties in the UK Parliament joining forces to prevent the Prime Minister allowing the country to crash out of the EU without a deal amid warnings of catastrophic economic consequences.

On October 15, Britain stops being a democracy

September 30, 2019- Issue brief by GPI Fellow Martin Hutchinson, By a vote of 298 to 56 on September 4 and a second similar vote on September 9, the House of Commons voted to approve an election on October 15, yet because of a supermajority provision unknown to the British constitution, Parliament was not dissolved. A Parliament you cannot dissolve is no longer a democratic institution, any more than was the Rump Parliament after Pride’s Purge. On October 15, therefore, Britain will turn the clock back 370 years, into the world of Praise-God Barebone. It will then need a Cromwell, or better still a Restoration to return it to democracy and legitimate rule.

September 30, 2019

The Universal Postal Union: Why Its Upcoming Extraordinary Congress Is A Big Deal

September 25, 2019- Issue Brief by Paul Steidler, The Universal Postal Union sets the rates and regulatory requirements governing the shipment of packages internationally. The Lexington Institute’s Paul Steidler spoke with postal expert Jim Campbell about the organization’s September 24-26 Extraordinary Congress at which the U.S. is pushing for major reforms and threatening to leave the organization if these reforms are not enacted. Mr. Campbell has been an observer at Universal Postal Union meetings for decades. The U.S. delegation to the upcoming Extraordinary Congress will be led by Peter Navarro, Assistant to the President and Director of Trade and Manufacturing Policy.

September 25, 2019

Poland Is Becoming the Keystone of NATO’s Evolving Security Architecture

September 18, 2019- Issue brief by Dan Gouré, The Republic of Poland is rapidly becoming the critical member of the NATO Alliance in its increasing efforts to deter Russian military threats and counter Moscow’s attempts to subvert European democracy. Poland is no free rider when it comes to European security. It is spending more money in terms of a percentage of GDP than other NATO countries. The Polish military has a serious modernization program underway that over time promises to make it a serious counterweight to the Russian Army.

September 18, 2019

Thanks to Fracking, No Panic in the US After The Attacks on Saudi Oil

September 18, 2019- Issue Brief by GPI President Paolo Von Schirach, The most astonishing consequence of the unprecedented, devastating attack on Saudi Arabia which crippled the Kingdom’s oil production and refining facilities is what did not happen, especially in the USA.

There was no panic in the US or worldwide; no skyrocketing, out of control oil prices. Yes, crude prices went up, significantly; but not in a dramatic way, if you consider that the supplies of Saudi Arabia, the leading world exporter, (along with Russia), have just been cut down by 50%! That 50% represents 5% of total world supply. In an environment where strong demand matched tight supply, this sudden shortfall would be a disaster, especially for the US, along with China the leading oil consumer. But right now world oil supplies are not stretched, notwithstanding steady demand, thanks to the US fracking revolution which added millions of barrels of oil a day to global energy markets. More on this in a moment.

The President Is Right — China’s Fentanyl Is Killing Too Many Americans

September 17, 2019- Issue Brief by Paul Steidler, Kudos to President Trump for tweets tearing into China and President Xi Jinping on Friday for not stepping up to stop fentanyl shipments to the United States. With 47,600 opioid deaths in 2017 alone, this crisis must end.

The president should double down while sharpening and refining his messaging. And he should do so regardless of the ups and downs of tariff negotiations.

China has become the worldwide manufacturing hub of opioids, and with that has arisen criminal businesses that export fentanyl and other deadly narcotics to the United States. These businesses are sophisticated and slick: they operate through well-designed websites that include online chats, negotiate for bulk purchases, take bitcoin payments and even specify shipping preferences.

September 17, 2019

A leverage tax will solve funny money problems

September 17, 2019- Issue Brief by GPI Fellow Martin Hutchinson, We seem doomed to another round of monetary “stimulus” from the Fed and the European Central Bank, at a time when real interest rates are already substantially negative. This has caused crazy leverage all over the global economy, with such madness as Boeing (NYSE:BA) in a highly cyclical business, operating entirely without stockholders’ equity. Very well, if we can’t get the monetary madmen at the world’s central banks to raise interest rates to their proper level, let’s find a fiscal solution to the problem, which will also reduce the world’s yawning budget deficits. I propose a leverage tax.

Why Aircraft Carriers Are The Most Cost-Effective Way Of Containing China’s Military

September 16, 2019- Issue brief by GPI Senior Adviser Loren B. Thompson, Deterring and/or defeating aggression by China’s military has become a top priority of U.S. defense strategy. Due to China’s geographical circumstances, Pentagon planners assume that any outward thrust of the People’s Liberation Army, Navy and Air Force would occur in the east, presumably using maritime routes. So it is there that America and its allies intend to block aggression

September 16, 2019

Brexit Mess turns into Quagmire

September 5, 2019- Issue Brief by GPI Fellow Graham Bardgett High ranking veteran Conservative MPs, including grandson of Winston Churchill, Sir Nicholas Soames, and Father of the House of Commons Kenneth Clarke, helped stop UK Prime Minister Boris Johnson pushing forward with a disastrous "Do or Die No Deal Brexit” on 31 October.

September 6, 2019

Vigilance Essential for Electric Grid Protection

September 4, 2019- Issue Brief by Paul Steidler, While cyber-attacks that steal credit card information or hacks into celebrities’ computers get far more media attention, electric grid attacks are far more ominous. And, as numerous senior government officials have pointed out, this can be easily done by Russia, China and many others.

September 4, 2019