Taking the Magic out of Strategic Analysis

It was in only the second edition of the weekly Defense Newsletter — soon to become Defense & Foreign Affairs Daily — on April 10, 1972, that we forecast that Egypt would, within six months, expel Soviet forces, technicians, and aid programs from the country.

It was a forecast of global importance, suggesting a transformation not only of the Middle East but of global trade and strategic architecture.

The report in our (then) San Francisco-based publication cited very senior sources within the Egyptian Government and Armed Forces. But the brief analysis relied on a broader view of the situation than just brief tips from senior officials. It looked at the context leading up to the change.

The report drew significant numbers of hostile responses from within the US intelligence community to this small, private organization. It was impossible, those agencies said, given the dependence the Egyptians had on Soviet logistics support for its combat aircraft, armor, artillery, and ordnance. Such a break would be unthinkable.

President Anwar as-Sadat, however, expelled the Soviets within four months.

Sadat knew that the Soviets would continue to constrain Egyptian initiatives to regain the Sinai and reopen the Suez Canal, so the Soviets had to go if Egypt was ever to achieve control over its own destiny. By October 1973, Egypt had transformed the shape of its military, and was ready to launch a profoundly skillful and complex cross-canal assault which would surprise Israel and result in Egypt’s recovery of the Suez and the Sinai.

It was a move of global significance, setting in chain events which shape the Middle East and global trade today. And it was a move which was designed to remove Egypt from dependence on any foreign power.

Running along intelligence, rather than journalistic lines

It was not just the US intelligence community which failed to understand the warning in our Defense Newsletter; it was also the Israeli intelligence community. And that was just the second edition of the weekly report, which was airmailed to government subscribers around the world. So how did the publication — which ran along intelligence, rather than journalistic lines — begin with such valuable output?

Gregory Copley, the Australian defense, aviation, and maritime writer and founder of Defense Newsletter, had enlisted the support of someone whose background and achievements in strategic intelligence and analysis and strategic philosophy was as breathtaking as it was discreet: Dr Stefan T. Possony, at that stage Director of Studies at the Hoover Institution at Stanford University. Before that, he had been a major source of Allied intelligence understanding on the mechanics and economics of warfare, particularly (in the late 1930s and early 1940s) German warfare. He also played a significant and very secret role in orchestrating the surrender of Japan. He had authored numerous books and studies since his escape from the Germans, and even since his time working with Albert Einstein at the Institute for Advanced Studies, in Princeton.

Possony was subsequently acclaimed as the greatest strategic philosopher of the 20th Century.

Copley was initially unaware of the depth of his new colleague’s background, but realized that Possony had a grasp of strategic frameworks which far outreached just military or political issues. They had met at San Francisco’s Bohemian Club, where Possony had been invited to lecture, and where Copley had been invited to attend. Copley, after the talk, approached Possony and outlined his plans for the newsletter, aimed at providing strategic thinking for many of the governments around the world who lacked access to world power-level thinkers.

Possony immediately agreed that they should collaborate on the project, and began an association which included telephone calls and meetings, seven days a week, 365 days a year, for a more than a couple of decades. Possony provided the rigor of the analytical process, instilling rules of behavior. Copley already had a worldwide string of contacts and correspondents based on his earlier experience in running a global news wire service.

It was from this network that Copley received the information from Cairo. His discreet field agent was of proven capability, and his sources were of the highest caliber. The US had little contact with Egypt at the time, and no way to breach the opacity of the Cairo-Moscow relationship. Moreover, Copley and his network were not constrained by “established” views of the situation.

So Defense Newsletter already had established protocols and methodologies to verify and contextualize high-quality sensitive information from the beginning of publication. It was similar sourcing which enabled stalled negotiations in 1972 to be re-opened to sell the US Grumman F-14A Tomcat fighters to the Imperial Iranian Air Force. The publication highlighted the two supposedly trusted Iranian middlemen who had been holding Grumman to ransom for higher commissions.

Defense Newsletter, to the nervousness of Grumman (now Northrop-Grumman), published all the details, which the Shah of Iran then acted on to break the logjam. The fighters were delivered. The Shah was later — in 1978 — to say publicly (to Khayyan International newspaper) that although his main intelligence service, SAVAK, was good, he relied consistently on Defense & Foreign Affairs.

Proposing the Strategic Defense Initiative

In the background to all this, Possony nurtured Copley into the world of strategic weapons and space warfare, including the field of space-based anti-ballistic systems, which Possony conceived: the Strategic Defense Initiative (SDI). This meant a rigorous period of research, for Copley, on Possony’s dominant and acclaimed areas of expertise: the USSR and communism. By 1973, Possony had introduced Copley to the Chief of Staff to US President Richard Nixon, General Alexander M. Haig, Jr., who was later, under President Gerald Ford, to become Supreme Allied Commander Europe (SACEUR) at NATO, and later US Secretary of State. Haig, in retirement, would become a key member of the advisory board of Defense & Foreign Affairs (D&FA) and the International Strategic Studies Association (ISSA).

By 1974, Copley’s friendship with British Conservative politician Geoffrey (later Sir Geoffrey) Pattie paved the way for greater D&FA presence in the UK. Pattie, once the Conservatives took power in 1979, quickly rose through the ministerial ranks in defense and trade. He, too, later joined the ISSA/D&FA advisory board, along with former Egyptian Minister of Defense Field Marshal Mohammed Abu Ghazala.

In a world in which intelligence was coming to be dominated by investment-heavy technologies, the approach by the D&FA system was dependent on HUMINT (human intelligence) and the expertise of specialists and contacts deeply embedded within certain skill or geopolitical areas. The key also was to rely on the evolution of this network gradually, building trust over decades.

Seeing patterns of target behavior and strategic architecture evolve over long periods builds the ability to determine trends — within a global context — and therefore determine the probable direction of events. It was for this reason, as much as the prohibitive constraints of electronic intelligence that the team focused heavily on HUMINT and human analysis, at a time when computerization and electronically-sourced intelligence was thought to be bypassing the “HUMINT era”.

It was not that the team ignored computerization; far from it. When feasible, it incorporated computers to add speed to the process of intelligence consolidation and secure communication, but it understood that nothing eclipsed the need for the evolution of human understanding of strategic context, including history and geography, and the evolution of societies. By the early 1970s, we had created a desktop computer specifically to manage the storage and transmission of data.

The growing track record of the team was a tribute to the fact that professionally evolved intuition, and knowledge of how societies needed to act, would always surpass computerized analysis and artificial intelligence in the strategic trend analysis world.

Much of this was achieved by relentless tracking of global issues, all brought together in the vast Defense & Foreign Affairs Handbook, with data published each year covering every country and territory in the world. This unique product, now computerized and online for constant updating, was described by Don Regan, US President Ronald Reagan’s Chief of Staff, as “indispensable to the running of the White House”.

Collapse of the USSR and PRC

Stefan Possony — Steve — was a longtime collaborator with US politician and Presidential hopeful, Ronald Reagan, and not only sold the SDI concept to him, but also the belief that the USSR could be brought to the point of collapse by 1990 or 1991.

This forecast he made in 1972, based heavily on demographic and economic trends in the USSR, and the space-defense competition which exhausted the USSR’s resources, became a fundamental premise for Defense & Foreign Affairs' analysis of the situation.

The USSR collapsed in 1990-91.

One of the key collaborators at this time was former Possony student (at Georgetown University), General Alexander Meigs Haig, Jr., who was Chief of Staff to then-US President Richard Nixon and later President Gerald Ford. Haig was the key facilitator of the Nixon initiative to break the People’s Republic of China (PRC), under Mao Zedong, away from the USSR. Critical to this initiative — which was later to get a public face through the initial visit of Dr Henry Kissinger to Beijing — was Haig, who worked assiduously through the Shah of Iran and Pakistani leader Zulfiqar Ali Bhutto, to make the China initiative happen, with the ultimate visit of US President Richard Nixon to Beijing in 1972.

That initiative worked so profoundly well that the Soviets immediately began their political action to bring down Nixon’s Administration. And in that they succeeded. But that is another saga. Meanwhile, the Defense & Foreign Affairs team continued looking at the lifespan available to the Chinese communist leadership, and by 2007, even when the PRC was economically in a seemingly unstoppable burst of growth, determined that lack of a capacity to adequately feed its own population would be a major component in the collapse of the PRC. In 2007, Copley forecast that the PRC would begin to implode by 2025.

Even in the case of India, where Defense & Foreign Affairs had always maintained a bureau, it had become obvious that food self-sufficiency was the key to India’s emergence as a major power. It was in the late 1980s that India, in fact, achieved exportable agricultural surpluses, largely through concerted scientific approaches to crop selection. At that time, the team indicated that India was now preparing for its second stage in becoming a global power: the export of capital. We were also tracking the development of nuclear weapons in North Korea, India, Pakistan, and Iran, well ahead of the intelligence communities of the West in understanding where this was leading. We were also early identifiers of the current Turkish nuclear weapons program, and had tracked the Iraqi nuclear weapons program’s move to Libya, and so on.

But, as with our tracking of Indian food production, we recorded that the PRC had attempted to bypass the food self-sufficiency phase, moving — to accelerate strategic power — to the stage of capital export, something which gained real momentum when Xi Jinping achieved supreme power in 2012. India, however, had addressed the fundamentals in order; the PRC had not, and paid the price for it.

"Where are the new monks of strategic intelligence?"

With all of this, as Possony had insisted, the study of historical trends, cycles, and proven patterns was critical when interpreting the longer-term impact of current intelligence. At the same time, however, modern politics and intelligence had lost its ability to determine its own course. Intelligence had always been an ascetic, monastic profession, little influenced by “open source” media. With the internet, intelligence and policy became openly polluted by unsubstantiated and unprofessional information, and often information warfare. At the same time, politics moved at the pace and direction of the crowd.

Politicians, and therefore democracy, ceased to be the font of inspiration and leadership; they became dominated by the mass psychoses of the streets.

So where does this leave professional intelligence analysis and the disciplined processes of the craft?

Modern technologies and social media remove a broader vision from policy-level intelligence discipline. Intelligence often now follows uninformed public opinion, rather than leads it.

The question remains: where are the new monks of strategic intelligence?