June 10, 2023

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Foreign-Policy Predictions Are Chronically Bad Because International Relations Rewards Catastrophic Thinking

In a world defined by scarcity, there will always be a bountiful harvest of bad predictions about the future. This is true for both foreign policy and Foreign Policy alike. In January 1989, East Germany’s leader, Erich Honecker, declared that the Berlin Wall would still be standing in “50 or even 100 years.” He turned out to be off by 49 to 99 years; the wall crumbled 10 months after his statement.

No one writing in the pages of this magazine has been as consequentially wrong as Honecker. Nonetheless, even a cursory perusal of Foreign Policy’s archives reveals some serious errors in foresight. One article in the Winter 1999-2000 issue by the Russia expert Daniel Treisman claimed that Boris Yeltsin’s successor as president of Russia would “find himself blocked in by the realities of Russia’s political game, pushed back toward a set of policies and a style of governing that closely resemble Yeltsin’s.” In retrospect, this seems like a poor description of Vladimir Putin’s style of governance. This is less Treisman’s fault than a consequence of the ever present danger of believing the status quo will persist.

Similarly, a 1995 article by the sociologist Jack A. Goldstone asserted that rapid economic growth would not save the Chinese Communist Party (CCP) and that “we can expect a terminal crisis in China within the next 10 to 15 years.” It is safe to say that the CCP has, so far, managed to endure and entrench itself. Goldstone was proved wrong because the past didn’t predict the future; Chinese economic growth accelerated to a historically unprecedented rate.

Likewise, in early 2009, the economist William Easterly forecast that the 2008 financial crisis would immiserate those who had just emerged from extreme poverty. Over the next five years, however, growth in the developing world actually outpaced growth in the wealthier economies of the Organization for Economic Cooperation and Development.

Predictions that did not come true were by no means limited to the pages of Foreign Policy; the field of international relations is full of them. In the 1970s, the Club of Rome predicted that resource depletion would stunt global prosperity. Instead, the greatest reduction in global extreme poverty began a few years later. In the late 1990s, when petroleum prices were plummeting, some took to these pages to predict the end of OPEC. Instead, the price of oil skyrocketed well past $100 a barrel. This, in turn, led to renewed claims of “peak oil”—the idea that petroleum reserves would near depletion and the industry would go into decline. Fracking and the development of alternative energy systems proved that to be wrong as well.

When the Cold War ended, multiple prognosticators predicted geopolitical chaos in Europe and a great-power rivalry between the United States, Europe, and Japan. Oops. The 100th anniversary of the start of World War I led many historians to envisage a replay of those events in the Pacific Rim in 2014. Thankfully, this too did not come to pass.

With a surfeit of bad takes, it would be logical to conclude that there have been few good foreign-policy ideas over the same time period. This assumption is incorrect. Consider two examples from the early 1970s. After the 1973 OPEC embargo, the fear of commodity cartels gripped national security analysts. The political scientist Stephen D. Krasner argued in this magazine, however, that oil was the exception. History proved him right.

The push by civil rights activists to make human rights a key component of U.S. foreign policy during the Carter administration was one of those ideas that seemed to bear little fruit at the time. This emphasis, however, persisted into the Reagan administration, and the result was the dawn of the third wave of democratization that transformed Latin America, Eastern Europe, and the Pacific Rim. Some ideas that are underappreciated when first proposed acquire momentum over time.

A number of concrete foreign-policy ideas have been responsible for tangible improvements in people’s lives. Weirdly, however, these constructive arguments get less attention than famously wrong ones, like Samuel P. Huntington’s proposed clash of civilizations or the neoconservative belief that forcible regime change can contribute to democratization. The past 30 years have demonstrated that wars within civilizations are far more bloody than those between them and that forcible regime change is far more likely to lead to military quagmires than Madisonian republics.

For anyone intimately familiar with the marketplace of foreign-policy ideas, this phenomenon should be unsurprising. Scholars like to think that, in the public sphere, good notions drive out bad ones, but that’s not necessarily true. Even foreign-policy experts tend to dwell on spectacularly bad ideas rather than helpful suggestions. Francis Fukuyama has a long, distinguished career of trenchant scholarship, but most foreign-policy observers remember him only for his premature prediction of the “end of history” in the early 1990s—the idea that Cold War ideological confrontation would give way to the triumph of liberal democracy.

A review of the worst predictions and most useful ideas of the past half-century reveals a few lessons for the readers of Foreign Policy. The first is that foreign-policy observers are a pessimistic lot. We are awash with doomsaying that has proved no more accurate than a cult member holding a sign declaring “The end is nigh” on the street corner. The second is that when examining trends within countries, the primary source of bad predictions is the fallacy of extrapolation: the belief that the future will be just like the present, only more so. The third is that the most useful ideas are not rooted in grand strategy or doctrine. Sometimes grand narratives get the big things right, but just as often they create cognitive blinders that make it difficult to recognize error. By contrast, small-bore ideas—grounded in concrete, specific, well-defined problems—have made the most tangible contributions to international affairs.

To be fair, international relations experts are hardly the only social scientists with a poor record of projecting the future. Economists have also proved extremely bad at forecasting, even though there are some awfully powerful incentives for economists to get things right. What makes foreign-policy analysts different is the bias in their forecasting errors. Economists are overly rosy about the future. This profound “optimism bias” explains the errors of the Bretton Woods institutions. On average, for example, a 10-year macroeconomic forecast from the International Monetary Fund or World Bank overestimates a country’s annual GDP growth by 1.1 percentage points.

Political forecasters, however, suffer from a different bias: We are a profoundly pessimistic lot. As the Yale University professor John Lewis Gaddis once delineated in painstaking detail, international relations scholars failed to predict both the peaceful end of the Cold War and the manner of the Soviet collapse. After the breakup of the Soviet Union, realists in particular made overly pessimistic predictions about how the post-Cold War order would affect NATO, nuclear proliferation, violent conflict, and balancing against the United States. In reality, the 20 years after the breakup of the Soviet Union saw dramatic declines in almost every category of political violence. The realist line sounds slightly more accurate now, but prognosticators earn no points for predictions that might come true 30 years late.

Some of the pessimistic—and often wrong—predictions from <em>Foreign Policy</em> past.

Some of the pessimistic—and often wrong—predictions from Foreign Policy past.

There are three reasons why foreign-policy analysts are so morose. First, it’s good for business. International relations is a countercyclical profession; bad times in the world are good times for geopolitical analysts—and there are incentives for doomsaying. The growth industry of political risk analysis, the first generation of which emanated from international relations scholarship, is predicated on things going wrong. One high-ranking officer at a prominent risk consultancy once explained the company’s sales pitch as follows: “You scare the shit out of them first. That’s what gets the clients through the front door.”

Second, much like the reasons for having insurance on your house or car, it pays to devote greater attention to the extreme negative event. Over the past 50 years, there have been positive events: the end of the Cold War, collapse of apartheid, reduction in extreme poverty, and growing ease of cross-border communication. Nonetheless, both government officials and corporate leaders are compelled to respond to negative shocks like a terrorist attack, a global financial crisis, or a pandemic, which will have a far greater impact on politics and profits than a spate of good news.

This is partly because human beings are hard-wired to be wary of threats; governments are, too. As one academic paper recently observed, “States tend to inflate threats, exhibit loss aversion, and learn more from failures than from successes.” Even if the probability of bad events happening is low, warning about them has minimal downside. No officials have ever been punished because they were too prepared for a worst-case contingency. Leaders get punished for sleeping at the wheel far more than they do for appearing too vigilant.

Finally, there’s an asymmetry in the marketplace of foreign-policy ideas. It is much safer to predict doom and gloom than to predict that everything will work out fine. Warnings about disaster scenarios that never happen carry less cost to one’s reputation—that is someone just being cautious and prudent—and if you happen to be right, you’re treated as a prophet, as the Foreign Policy columnist and health writer Laurie Garrett recently discovered.

History has stigmatized optimistic prognosticators who, in retrospect, turned out to be wrong—see, for example, the caricatures of Norman Angell’s 1909 book, The Great Illusion, which predicted that economic interdependence would make war obsolete, or Fukuyama’s end of history. When in doubt, predict the worst-case scenario.

These professional tendencies have led to some bad collective forecasts. The end of U.S. hegemony in world politics has been the hardiest of bad predictions. By my count, in Foreign Policy’s 50 years, the death of U.S. hegemony has been declared after at least six different events: the collapse of the Bretton Woods regime in the early 1970s, the stagflation of the mid-1970s, the late 1980s “twin deficits” crisis, the 2003 invasion of Iraq, the bankruptcy of Lehman Brothers, and the election of Donald Trump. U.S. hegemony will end at some point, but America’s status as a superpower has outlived many of its most pessimistic prognosticators.

If forecasters have been too pessimistic about the state of the world, they have been too complacent in their assessments of the great powers. When it comes to country analyses, the natural tendency has been to extrapolate from current trends. Indeed, two political scientists made this very point in these pages in 2012 when characterizing U.S. National Intelligence Council documents: “The reports almost inevitably fall into the trap of treating the conventional wisdom of the present as the blueprint for the future 15 to 20 years down the road.” While this is a natural human tendency, large complex societies have a way of confounding that instinctual view. Sometimes trends do persist, but just as often they stop abruptly or reverse course.

Predictions about China are a case in point. Two decades ago, predictions about the future of Chinese politics ran the gamut from democratization to stable authoritarianism. In March 2000, U.S. President Bill Clinton predicted, “The more China liberalizes its economy, the more fully it will liberate the potential of its people. … And when individuals have the power not just to dream but to realize their dreams, they will demand a greater say.” Even more sober analysts noted that by the early 2000s China had seemed to institutionalize the transfer of power, a rarity in authoritarian regimes. Instead, under Xi Jinping, China has transformed into the most personalist regime since the days of Mao Zedong.

The fallacy of extrapolation also applies to forecasts about China’s economy. A decade ago, Robert Fogel, a Nobel-winning economist, made waves with a Foreign Policy article predicting that China’s economy would swell to $123 trillion by 2040. He made this prediction simply by assuming that China’s double-digit growth rates from the early 2000s would persist and extrapolating from there. In the decade since, China’s growth rate has slowed significantly—and even those growth figures are likely to be exaggerated. Over the past quarter century, China’s productivity growth has fallen by two-thirds. Now, some experts believe that people should fear a faltering China more than a rising one.

China is the standout for bad predictions about national trajectories, but it is hardly alone. U.S. analysts persistently overestimated the capabilities of Soviet Russia during the Cold War. These same analysts underestimated Russian power during the days of Yeltsin. Under Putin, the pendulum has swung back toward exaggerating Russian power.

Fifteen years ago, in his book Expert Political Judgment, the political scientist Philip Tetlock warned about the poor predictive ability of most political experts. The discipline’s short-term predictive abilities are lackluster. Worse, the public tends to pay attention to the out-of-the-box prediction that proves correct. The problem is that these kinds of predictions also tend to be wrong more frequently. Tetlock later wrote that these conditions would create a ripe environment for charlatans: “The demand for accurate predictions is insatiable. Reliable suppliers are few and far between. And this gap between demand and supply creates opportunities for unscrupulous suppliers to fill the void by gulling desperate customers into thinking they are getting something no one else knows how to provide.”

It would be easy to infer from this that the foreign-policy community has produced nothing but 50 years of bad ideas. Indeed, this is what younger generations tend to think. A recent Rand Corp. report concluded, “A generation of Americans have come of age in an era in which foreign policy setbacks have been more frequent than advances.” Anyone as old as Foreign Policy has some memory of successful foreign policies: containment, the peaceful end of the Cold War, the cessation of ethnic cleansing in the Balkans, beneficial trade agreements, and the expansion of U.S.-created international institutions to the rest of the world. Any American who came of age after the 9/11 terrorist attacks would be hard-pressed to identify similarly successful policies in this century.

Any autopsy of this shift is likely to arrive at the same explanation for the cause. Because the U.S. diplomat George F. Kennan’s strategy of containment is now viewed as a smashing foreign-policy success, successive generations of foreign-policy analysts have tried to devise a similar “big idea” in grand strategy that would prove to be just as valuable. The world is a more complex place than it was during the 1950s, however, making it next to impossible for a single grand strategy to suffice. None of the post-Cold War grand strategies, from George W. Bush’s neoconservative democracy-promotion-by-force to Donald Trump’s America First, has served the United States well.

This does not mean, however, that there haven’t been any good ideas in foreign policy. A more fine-grained analysis reveals the success of small-bore initiatives. The most significant foreign-policy accomplishment of the post-Cold War era was arguably the Nunn-Lugar program. This program helped ensure the security of the Soviet Union’s nuclear arsenal after the collapse in 1991. Over the next two decades, the program succeeded in preventing both nuclear material and nuclear scientists from furthering proliferation across the globe. Unsurprisingly, as one historian noted, “this success did not get major publicity at the time, and remains largely unknown today outside the expert communities in both countries.” The Barack Obama-era Nuclear Safety Summits might be viewed through a similar lens.

Another tangible success has been the President’s Emergency Plan for AIDS Relief (PEPFAR), created by the Bush administration in 2003. It was announced at a time when the HIV epidemic was lowering life spans in sub-Saharan Africa. According to the program’s website, the U.S. government has since invested some $85 billion in the global HIV/AIDS response, saving more than 18 million lives. This is a rare case of the United States doing well by doing good. Global surveys of public attitudes toward the United States since PEPFAR was launched consistently show that recipient countries display more positive attitudes toward America. As infectious disease prevention moves to the top of the global policy queue, the United States should learn from PEPFAR’s success.

A final example is the 2014 bilateral climate deal between the United States and China. This might seem like an odd inclusion, since it was soon supplanted by the 2015 Paris climate change accords, which the Trump administration abandoned. But the earlier bilateral deal played a crucial role in paving the way for a more wide-ranging agreement. By getting Beijing to formally pledge to reduce greenhouse gas emissions, the 2014 deal reversed China’s long-standing position that, as a developing country, it should not bear any responsibility to reduce climate change. Once China shifted its approach, it became far easier to cajole developing countries into an international agreement.

The takeaway from all this is clear: To stand out, future foreign-policy observers will become less pessimistic and more concrete. Of course, I am making a prediction here. The odds are excellent that I am wrong.