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Authors: Joshua Cooper Ramo

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But — and this is where Moritz and Farkash show a bit of genius in their work — even though an interconnected world may make
analysis harder, it doesn’t make it impossible. If you can master the skill of looking deeply, it can deliver everything you
may have dreamed of. “We must free ourselves from seeing things as they are!” Bak wrote once. His point wasn’t that we should
ignore things as they are but that what mattered most was looking in such a way that we could see what they might become:
sandpiles, our children, physics itself, the global order. Everything Bak knew about the history of science told him that
only then could the real work of invention begin.

C
HAPTER
E
IGHT
The Management Secrets of Hizb’allah
1. Balance of Terror

In the summer of 1960, a Harvard professor named Henry Alfred Kissinger completed work on a book about American foreign policy
called
The Necessity for Choice.
Kissinger was thirty-seven (the book was dedicated
To My Parents
) and was known as a rising academic star in Cambridge, one of those teachers so popular he caused students to redirect their
ambitions or change their majors. The book was a sequel to Kissinger’s 1957
Nuclear Weapons and Foreign Policy,
which had begun to build a reputation for him in Washington that matched the one he had in Cambridge: brilliant, driven,
and with complete fluency in how history might be a guide to the future.
The Necessity for Choice,
the jacket copy told the potential buyer, “is a book which every concerned American should read, if he wants to understand
the facts behind the newspaper headlines, and to be informed as to possible solutions — even if imperfect.” Shortly after
John Kennedy was elected president in the fall of 1960, his aide (and Kissinger’s colleague at Harvard) Arthur Schlesinger,
Jr., slipped the senator an early copy.

The essential idea of
The Necessity for Choice,
the problem “behind the headlines” that interested Kissinger, was an uncomfortable one. Americans, he explained, needed to
ask if a nuclear attack by the Soviet Union could be deterred. There was good reason, he argued, to worry that the answer
was no. The United States had the wrong sorts of missiles, it wasn’t prepared to absorb an attack and then deliver a devastating
revenge strike, the country’s allies were too vulnerable, it was bungling negotiations on everything from arms control to
relations with newly independent nations, and Americans were possibly less psychologically secure than the Russians. (Here
Kissinger had in mind the Soviet pillaging of Hungary as the United States stood by, deterred, he wrote, “by our unwillingness
to pay the price of victory.”) The idea that America faced a “gap” in its deterrence ability, one that could be measured in
missing missiles and then made up over time like some sort of factory production shortfall, Kissinger argued, was absurd.
“There can be no gap in deterrence,” he wrote. “Deterrence is either effective or it is not. There is no margin for error.
Mistakes are likely to be irremediable. If the gains from aggression appear to outweigh the penalties even once, deterrence
will fail.” This was terrifying, particularly given that the likely price of failure was nuclear war or endless Soviet blackmail.

The ideas in
The Necessity for Choice
were a rough sketch of what Kissinger and others later polished into détente, a policy in which American Minuteman missiles
and Soviet SS missiles marked out a binary bargain that would either secure the survival of mankind or result in its near-destruction.
This cold balance had at least the merit that it reduced international power to its most elementary calculus, a question that
almost defined international politics: how do you stop another state from attacking you?

You can see, already, the limits to this question in our revolutionary age. The logic that guided international affairs for
centuries was that
threats
of violence could buy safety. This “my dog is bigger than your dog” theory of politics and military affairs led to arms races
like the one that made Kissinger so nervous in the 1960s. But that logic can’t even begin to contain the dangers of an age
of surprise. There’s no way to deter terrorists eager to die for their cause or diseases that start at the intersection of
man and animal and spread by airplane. Financial panics in markets dominated by instruments it takes a Ph.D. even to discuss
are unpredictable
and
undeterrable. You cannot deter the changes in the global economy wrought by a rising China, the pressures of Hindu nationalism
in India, water shortages in Mexico, or the hot-blood appeal of a charismatic dictator. In some respects, these sorts of undeterrable
wildfire scenarios aren’t new. (Think of the Great Plague.) But what
is
new is that such threats spread more quickly and widely than ever, mashing up into new dangers when we try to regulate or
control them.

Physicists call such perplexities, parts of a complex system that can’t be modeled, ironed out, or removed, “irreducible unknowns.”
Often they’re not only irreducible but
novel:
never seen before. Traditional approaches to stability rely on observations, on historical lessons, on a record of experiment.
This is how we build bridges, airplanes, political systems, and even our own lives — we use models of what’s worked in the
past. But when you’re constantly confronted by the unthinkable? When those irreducible unknowns produce “once-in-a-hundred-years”
events every few months? Well, that marks out the next transition we need to make in pursuit of deep security.

2. The Snapped Ruler

Learning to
think
in deep-security terms means largely abandoning our idea that we can deter the threats we face and, instead, pressing to
make our societies more resilient so we can absorb whatever strikes us. Resilience will be the defining concept of twenty-first-century
security, as crucial for your fast-changing job as it is for the nation. We can think of resilience as a measure of how much
disturbance a system can absorb before it breaks down so fundamentally that it can’t easily return to the way it once was.
Think of a plastic ruler. How far can you bend it before it snaps? Or an ecosystem: how many trees can you slice from a forest
before animals that live there start dying? Resilience is a broad concept: How many fights can you have with your spouse before
your marriage collapses? How much religious fervor can a country like Pakistan contain while still maintaining the characteristics
of a democracy? What about a terror attack, which then triggers a bond market sell-off, which triggers a depression, which
triggers riots? Once a system tumbles off a ledge and goes catastrophically bad, it is very hard to return it to its earlier
state; usually it is impossible. Scientists call this “hysteresis,” which comes from the Greek word
hysterein,
which means “to be late” — as in, once a system cascades like this it is too late to do anything about it. What happened
to the U.S. investment banking business in the summer of 2008 was a cascade of this sort. None of those firms, packed with
money though they were, had nearly enough resilience to bend under the force of the sudden — if self-inflicted — financial
shock they received. The snapped ruler remains snapped forever.

Yet to a degree that’s almost unimaginable until you’ve seen it in action, real resilience manages time and again to rescue
triumph from what initially looked like disaster. Remember Farkash finding that terrorists who survive do so because they
can adapt under pressure? They thrive because they evolve in the face of the unexpected. The best resilient systems are like
this. They don’t just bend and snap back. They manage to get stronger because of the stress. They capture the good from avalanches
of change without letting the bad wipe them out. Today we’re not nearly as resilient as we need to be. In fact, one could
say we now confront a “resilience gap,” not unlike the missile gap Kissinger and a generation of Cold Warriors worried about.
The awful truth for them was that you could deter your enemy or you couldn’t. There is no gray for us either. The border between
normality and hysteresis is invisible until (ask Gorbachev or the unemployed bankers from Lehman Brothers) we are on the wrong
side of it. We now must master resilience just as Kissinger and his generation once mastered deterrence.

3. Accidental Extinctions

Let us say for a moment that you and your family live on a lake. The fish in the lake represent your sole source of food and
income. You know, by instinct if nothing else, that it’s possible to overfish your lake. If you had one bonanza year in which
you pulled out as many fish as possible, it would probably be your last year of fishing. Still, it’s your living, so you want
to catch as many fish as you can, just not too many. This danger of overharvesting is one of the most intuitive in wildlife
management, and it makes a great deal of sense for any scarce resource. (If you relied only on rainwater for your house, your
showers would be a lot shorter.) Needless to say, you’d be very careful about how you fished on your lake.

Let us also imagine you are familiar with the work of the Russian ecologist F. I. Baranov, who in 1918 developed the first
mathematical model to describe the exhaustion problem, known as the “catch equation.” The equation was one of those powerful
ideas that led to a revolution in thinking. In particular, it encouraged a group of American ecologists to perfect a concept
that seems ideally fitted to your small corner of the world. Their idea was called “maximum sustainable yield (MSY),” and
it reduced the problem of wildlife management to an equation. The idea of MSY was that if you made a careful survey of your
lake, recording how many nutrients were available, how fast your fish bred, how many fish you had to begin with, and a handful
of other variables, you could calculate the natural “replacement rate” of the lake. As the Canadian ecologist P. A. Larkin
described it, “Any species each year produces a harvestable surplus, and if you take that much, and no more, you can go on
getting it forever and ever.” That surplus, if you could find it, would send your kids to college.

MSY was widely implemented in the 1950s and 1960s, a period when species protection was taking hold in thinking about natural
systems. It made so much sense that it was quickly applied to everything from halibut in the Pacific to salmon in Chile. It
served as the basis of international treaties and limits on recreational fishing — those “three fish and you’re out” rules
that are still in place to this day. MSY seemed to offer a sensible compromise between commerce and conservation. One scholar
later observed that with MSY the years after World War II were a “golden age” of sorts for American lakes and rivers: “The
mid-fifties were a fine time to be a fisheries biologist because you could be so single-minded about your job. The object
was to get out there and get the harvest of the maximum sustained yield.” So, knowing all this, you might head home and do
the same with your own lake, carefully measuring the replacement rate and then fishing right at that limit, never passing
the specified abundance that you had measured.

At which point, very likely and completely surprising since you were, after all,
following the rules,
instead of thriving, the fish in your lake would start to die in massive numbers.

The failure of MSY, which became obvious when mass extinctions started blipping up in what were supposed to be the best-run
ecosystems on earth, was a disaster for ecological science. MSY looked perfect on paper, and it had won the approval of hard-line
ecologists and the endorsement of fishermen. So when MSY started killing the very animals it was intended to protect, it was
like watching the world’s best-designed airplane go down in flames. Repeatedly. In a way, MSY was easy to understand (perhaps,
scientists said later,
too
easy). In this view the lake was a fish factory: nutrients came in, fish came out. The idea that some sort of nonlinear collapse
could occur made no sense. The scientists went back over their models; they fine-tuned the inputs, recalibrated the data,
and got, in the end, yet more extinctions. “The consequences for theory and management were enormous,” C. S. Holling soberly
recalled several decades after the MSY crisis had stunned both environmentalists and fishing firms into a perplexed silence.

Holling had been among the first to identify the lethal mistake lingering in the heart of MSY theory. In an influential 1973
paper, “Resilience and Stability of Ecological Systems,” he explained it this way: “If we are dealing with a system profoundly
affected by changes external to it, and continually confronted by the unexpected, the constancy of its behavior becomes less
important than the persistence of relationships.” In parts of the world where there isn’t a lot of change, Holling was saying,
it’s perfectly fine to keep track of the things you
can
measure: the number of books in a library, say, or the amount of food you need to get through a day. But in places where
there is daily, often explosive readjustment, such measurements are worse than useless. Lakes may look stable, but in fact
they operate with a level of deep, hidden complexity. The stability of a lake ecosystem can’t possibly be reduced to a few
variables. What matters isn’t something you can score quickly but rather the strange mesh of interactions that make a lake
resilient or not, the vibrancy that protects against exactly the sorts of extinction cascades MSY managers were trying to
avoid — but accidentally triggering. What you can easily measure in these systems matters much less than what you cannot:
How strong are the relationships between different parts of the lake ecosystem? How fast can it adjust to shocks? How far
can you bend the food chain in the lake before it breaks? In short, how resilient is it?

Holling’s radical idea was that the MSY extinctions were caused by forces entirely
outside
the system, factors no scientist had even thought to study or include in their models because they appeared so frankly unrelated
to the problem at hand. For example, when Holling looked closely at a lake ecosystem (in fact he looked at hundreds of them
in the course of his career), he found that increasing fish harvests to maximum sustainable yield may have brought more fishermen
(confident that the spot had not been overfished), and they left behind more trash than before, which blocked drainage channels,
which in turn wiped out a floating moss needed to feed other fish, which were the staple diet of the “target” fish. No one
had thought to ask:
How much foot traffic can the lake handle?
“The effective and responsible effort to provide a maximum sustained yield,” Holling explained, “might paradoxically increase
the chance for extinctions.” Over the years, however, MSY became
more
popular rather than less. What seduced ecosystem managers was the sense that they were doing something that felt scientific.
The equations of MSY made sense on paper — even though they were often deadly in practice.

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