Why Economics, Not Military Might, Is the Future of Foreign Policy

From Kiev to Kabul, the promise of prosperity is winning hearts and minds.
Protesters clash with riot police during a rally to support EU integration in central Kiev. (Valentyn Ogirenko/Reuters)  

In Kiev, hundreds of thousands of Ukrainians have taken to the streets to demand the government join the European Union, in the hopes it will spur economic growth. In Kabul, Afghan leaders overwhelmingly voted to have American troops remain for another decade, in the hopes they will maintain a “war and aid economy” that has brought them unprecedented riches.

As a fiscally constrained and war-weary Washington confronts its foreign policy challenges, events in Ukraine and Afghanistan show that economic incentives can play a major role in addressing them. Younger generations in both countries are eager for prosperity, reduced corruption and a place in a globalized economy. Globalism is challenging cronyism.

In Ukraine, many motives are driving the young demonstrators, who have been protesting since President Viktor Yanukovich abruptly announced that he would not sign an association agreement with the European Union. But a key belief voiced by protesters is that adopting EU-mandated judicial reforms would reduce the country’s staggering levels of corruption.

“They get access to the European rule of law,” Steven Pifer, a Brookings Institution senior fellow and former U.S. ambassador to Ukraine, said in a telephone interview Tuesday. “They don’t have worry about the corruption and the arbitrary seizure of property.”

Many Ukrainians, however, may overestimate the economic benefits of joining the European Union, as Julia Ioffe pointed out in the New Republic on Tuesday. Croatia’s economy, for example, has been tepid since it joined. And one of the first reforms the EU requires would mean increasing the low price of gas set by Ukraine’s notoriously corrupt energy sector.

Yanukovich’s surprise decision came just as Russian President Vladimir Putin is economically pressing Ukraine to join a rival trade group, led by Russia. This dispute is the latest example of jockeying between Putin and the West — which extends from the former Soviet bloc to the Middle East.

In recent years, U.S. officials have stepped back in Eastern Europe and allowed European Union officials to take the lead. While some have criticized that move as signaling weakness, Pifer argues that the European Union is more popular in Ukraine than the United States. Washington stepping back also eliminates a propaganda tool for the Russian leader.

“Putin can portray it as the United States is leading the charge,” Pifer said. “It’s another effort by the U.S. to hem in Russia.”

In Afghanistan, similar lessons are emerging. In a country famed for its xenophobia, the vast majority of the country’s political elite have criticized President Hamid Karzai’s last-minute refusal to sign a Bilateral Security Agreement, or BSA, that would allow a small number of U.S. forces to remain for a decade.

The reason? Economic. American and international funding of the Afghan government and its security services offers vast patronage opportunities for local leaders.

Presented by

David Rohde is an investigative reporter for Reuters and a contributing editor for The Atlantic. A two-time winner of the Pulitzer Prize, he is a former foreign correspondent for The New York Times and The Christian Science Monitor. His latest book, Beyond War: Reimagining American Influence in a New Middle East, was published in 2013. More

He is also the author of Endgame and, with Kristen Mulvihill, A Rope and a Prayer. He lives in New York City.

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