Alan Krueger on What Makes a Terrorist →

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I’m deeply saddened to learn that Alan Krueger has died. Many will recall his vast contributions to labor economics in the coming days. I had the honor of working for Alan on the Council of Economic Advisers, and he and I spoke about his work on the economics of terrorism. Alan focused his brilliant, analytic mind on society’s most pressing concerns.

Considering the Chinese Air Force's Best Response

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RAND released a report on the Chinese People's Liberation Army (PLA) asserting that "the main driver for Chinese military aerospace power development is the PLA's view that it needs to be prepared to deter and, if necessary, defeat the United States in a high-end clash." And, it states that the Chinese Air Force is closely following U.S. Air Force capabilities and copying or innovating in areas necessary to accomplish its objectives.

The author recommends that the U.S. Air Force should respond by monitoring advancements in Chinese military aerospace capability so it can exploit weaknesses and avoid further capability transfers. These are reasonable suggestions, but the U.S. should also consider how its own behavior may be encouraging Chinese military development.

If the Chinese are truly focused on developing their capability to compete with the U.S., it may be possible to reduce the impetus for additional Chinese military build-up by decreasing the negative rhetoric and providing less overt demonstrations of U.S. capability. The Chinese are responding to U.S. efforts to maintain Command of the Commons. In turn, the U.S. observes the increase in Chinese military capability and responds with additional investment that the Chinese then copy. We find ourselves in a tit for tat scenario of escalating responses. So, rather than overtly label China as a military threat which encourages further Chinese military modernization, the U.S. could preserve the effectiveness of its current capabilities by considering the best response of those concerned with U.S. military advantages. This is especially important at a time when the U.S. is already facing significant national security challenges.

"If you find yourself in a hole, stop digging."
—Will Rogers

Developing Cyber Deterrence

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The premise of nuclear deterrence is based on Mutually Assured Destruction (MAD). In hindsight, this success of this framework seems apparent and is widely taken for granted. But, at the time of its creation, a great deal of effort went into its formulation, and many debated its effectiveness.

With the advent of new destructive capabilities comes the need for additional means of deterrence. And, as the world economy has come to depend on cyberspace, the need to deter nefarious actors from attacking in cyberspace is paramount. Furthermore, much (if not most) of the other forms of deterrence is reliant on cyberspace operations.

Game theoretic principles form the basis of MAD. But, many of these principles do not hold in cyber deterrence. In the spirit of game theory, let’s examine MAD using backward induction.

  1. Destruction: To deter, each player needs a strategy that includes the capability to Destroy the other. While it is clear that cyber attacks can be quite destructive, the extent to which these attacks harm others varies. Additionally, cyber attacks need not be indiscriminate.
  2. Assured: For the optimal strategy to be Not Destroy, it is necessary for each actor to:
    a) know that it has the ability to Destroy, and
    b) know that the other player has the ability to Destroy
    For this reason, much of the nuclear testing which led up to the MAD strategy was conducted openly so that each knew the other’s capability to Destroy. This alone is not sufficient. For sufficiency, each player must also be willing to Destroy. Willingness makes the strategy of Destroy credible. Both the necessary and sufficient conditions are difficult to meet in regards to cyber. Revealing cyber capability renders that capability moot in most circumstances. Once an exploit is known, the other player will update their systems to preclude its use. Hence, players’ strategies to date have been to signal capability without specificity. More concerning is the inability to meet the sufficiency condition. The key concern is attribution. In nuclear deterrence, the players are known and monitoring is in place to detect actions. But, in cyber, attribution is difficult (if not impossible) and not timely. Without attribution, a player under attack may not respond in kind (or in proportion).
  3. Mutual: The failings in this area are a result of the conditions above. Players are both known and unknown; willingness and ability are unclear; and destructive outcomes are not guaranteed. This makes it difficult to reach an equilibrium where no player is willing to employ the Destroy strategy.

Just as the rise of nuclear capability led to advancements in game theoretic thinking underpinning the MAD strategy, growing cyber threats will drive strategic thinkers to develop new frameworks for deterrence under these new dynamics.

Is Kim Jong-un rational? →

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One of the central assumptions in basic economic theory is that agents are rational. However, behavioral economists question this assumption.

Recently, some have questioned whether the leader of North Korea is rational. However, do we need Kim Jong-un to be rational or just predictably irrational?

Disclosure of Material Connection: Some of the links in the post above are “affiliate links.” This means if you click on the link and purchase the item, I will receive an affiliate commission. Regardless, I only recommend products or services I use personally and believe will add value to my readers. I am disclosing this in accordance with the Federal Trade Commission’s 16 CFR, Part 255: “Guides Concerning the Use of Endorsements and Testimonials in Advertising.”

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