Osama bin Laden dead, global focus moves from terrorism

By Peter Apps, PoliticalRisk Correspondent

LONDON (Reuters): Osama bin Laden’s death is not the end of the West’s fight against al Qaeda but tackling Islamist militancy was already drifting down the priority list for policymakers, markets and voters even before his demise.

The deadly bombing of a tourist cafe in Morocco last week and Tuesday’s arrest of five men near the Sellafield nuclear site in Britain under the terrorism act, shows the threat of attack remains.

Pakistani security officials grant access to journalists to cover the compound where Osama Bin Laden was killed

Several methods were said to have been used to identify Bin Laden after he was shot during a raid at this hideout in Abbottabad

But since the 2008 global financial crisis the world has had so much else to worry about. Western states fret about their debt burden, ageing populations and he growing competition from rising economic powers, particularly China.

After street protesters ousted leaders from power in Tunisia and Egypt, leaders in emerging states are likely to be more worried about broad unrest than small groups of militants.

Most Governments, intelligence agencies and analysts were blindsided by the spring of revolution and revolt in North Africa and the Middle East, which pitted autocrats long seen as a bulwark against fundamentalism against angry populations demanding democratic and economic reforms.

Many decision-makers now suspect that such an intense focus on violent militants was an over-simplistic approach which meant they failed to detect other significant trends.

“Policymakers are lifting their eyes to a farther strategic horizon with counterterrorism much more in context,” said Nigel Inkster, a former Deputy Chief of Britain’s Secret Intelligence Service (MI6) who is now head of political risk and transnational threats at London’s International Institute for Strategic Studies.

“Issues preoccupying people now include the implications of a shift in global power, the wider impact of the Arab Spring, (competing) global value systems, global financial stability and natural resources.”

The September 11, 2001 attacks defined US foreign policy for a decade, driving its wars in Afghanistan and Iraq and providing governments from Russia to Libya, China to Sri Lanka, with diplomatic cover for the brutal crushing of insurgencies.

Intelligence agencies and military budgets soared and whole industries and career structures grew up advising both governments and private companies on militancy threats.

Terrorism “gravy train” over?

But now, a new generation of future military and national security officials are aiming to build their expertise in economics, geopolitics, cyber warfare and understanding social media. When banks and private companies hire outside consultancies to advise on political risk, they are more likely to be focusing on the same areas – or looking to gauge how Western democracies can to reduce ballooning deficits in the face of occasionally violent public opposition.

“It’s the end of an era,” said Celina Realuyo, Assistant Professor at the US National Defence University and President of consultancy CBR Global Advisors. “I think the counterterrorism/homeland security gravy train is over.”

After almost a decade focused on militancy, Realuyo last year changed her job title from “Professor of Counterterrorism” to the broader “Professor of National Security Affairs”.

She is writing an article on the national security implications of a declining US dollar and says her most popular courses are on globalisation, economic competition and demographics with terrorism now only one topic amongst many.

Financial markets rallied modestly and briefly on bin Laden’s death but completely ignored an attempted suicide attack on a Japanese oil tanker last year. In contrast, they reacted with much more striking alarm to Middle Eastern unrest seen as threatening oil supplies.

“I’d argue that bin Laden was on the wrong side of history while those demonstrating in Cairo or Tunisia have been on the right side,” said Renaissance Capital Chief Economist Charles Robertson.

“(But) it is those demonstrators seeking democracy in the Middle East who have done more to push up the price of oil – and so indirectly hurt the West – than anything he has done in recent years.”

Some analysts are already suggesting Bin Laden’s death may make it easier for US President Barack Obama to manage an exit from Afghanistan, one of his key aims ahead of 2012’s election.

But most analysts say that by the time presidential polls come round, voters will again be focused more on the economy and perhaps a growing narrative of relative American decline.

The information revolution and recent unrest in North Africa and the Middle East seems, at least for now, to have overtaken any narrative of a “clash of civilisations” between Western democracy and radical Islam.

In its place is growing talk of economic and geopolitical competition between authoritarian “State capitalist” emerging powers and more established Western democracies.

It’s already trickling through in national security priorities. While tens of thousands of troops remain embroiled in the conflict in Afghanistan, US defence spending patterns are already shifting as it faces new demands: the need to rein in a ballooning deficit and face a rising China.

 Worries over China – and to a lesser extent Russia – as well as freelance hackers also drive a growing emphasis on cyber espionage and warfare. Western states worry over the potential theft of intellectual property and sabotage of essential infrastructure.

Such concerns have been around since the collapse of the Soviet Union, but China’s breakneck growth and swift post-crisis narrowing of the economic gap with the US – and to a much lesser extent military gap – has ramped up the agenda.

“There is short-term benefit to Obama for sure (from the bin Laden killing), but it’s not the big structural issue – which is the rebalancing of global (economic) power away from the West and towards the emerging markets,” said Ian Bremmer, President of Political Risk Consultancy Eurasia Group. “That’s where the preponderance of political risk is.”