Foreign Policy

Foreign Policy

I’ve placed this chapter near the end of this book not because I view foreign policy as a secondary issue. On the contrary, it’s the President’s foremost responsibility and certainly the most critical issue our next President will face. However, before discussing foreign policy, I wanted to assure you, based on work I’ve done on more familiar ground, that I think deeply about issues, carefully consider all the facts, seek alternative views and advocate bold action where needed.

I don’t claim expertise on foreign policy. I haven’t studied the subject formally. What I have done over the years is taken every opportunity to discuss foreign policy, particularly national security threats, with the large number of U.S. and foreign government officials, military leaders, business leaders and members of the foreign press with whom I have come into contact with during my extensive travels.

I also have no direct experience in setting foreign policy. Here Secretary Clinton has a distinct advantage, which needs to be recognized and respected. But my long observation of U.S. foreign policy and the foreign policies of other countries is that those in charge — and, therefore, in possession of both public as well as classified facts — are fully capable of making the worst possible decisions. Becoming entrapped in ground wars in Vietnam, Iraq and Afghanistan are prime examples of these mistakes. Hence, foreign policy experience is no guarantee of foreign policy judgment.

We also need to judge foreign policy decisions not just on actions taken but on actions not taken. This brings me to our nation’s gravest national security threat: nuclear-armed North Korea, which has reached that ignominious description thanks to decades of U.S. foreign policy mistakes, specifically being naïve that the North Koreans were willing to negotiate in good faith and overvaluing the impact of sanctions on its nuclear armament decisions.

North Korea

According to our military, North Korea now has nuclear bombs small enough to place at the top of a missile. Worse, it is building additional nuclear bombs and enhancing their destructive power on a fulltime basis. This includes developing a hydrogen bomb, which North Korea claims to have already produced.

The North Korea threat compounds the Iranian threat. There is ample evidence that Iran and North Korea are sharing technology on both the production and delivery of nuclear weapons. Our recent agreement with Iran limiting that country’s development of nuclear weapons will be of little value if Iran simply procures nuclear bombs from North Korea.

As the past has so painfully taught us, we need to watch what our enemies do, not what they say. Anyone who seeks to understand what North Korea has been doing should visit, which chronicles the arms control negotiations, starting in 1985, to prevent North Korea from acquiring nuclear weapons. The site documents our repeated failed attempts to induce North Korea, with both carrots and sticks, to denuclearize. As the document makes clear, North Korea has never negotiated in good faith. Instead, it has used the three decades of overt negotiation to covertly develop the world’s most lethal weapons – weapons they are aiming at us.

Our country went to war with Iraq in order to limit that country’s potential nuclear theat. We did so on information that was known at the time to be questionable and which proved to be false. Yet we are remarkably passive when it comes to confronting an enemy that indoctrinates their children on a daily basis that the United States is the devil incarnate, that continually pledges to destroy us and that actually possesses nuclear bombs.

That passivity and naiveté has extended through the Clinton, Bush and Obama administrations. A prime example is President Obama’s statement in 2013 discounting the North Korean’s ability to miniaturize nuclear bombs and his suggestion we should give the North Koreans more negotiating time. With all due respect to the President, whom I deeply respect, time is not on our own and certainly not on our children’s side. In 2015, Army General Curtis Scaparotti, Commander of U.S. Forces in Korea, testified that he believes North Korea now has miniaturized nuclear bombs that can be fired at the U.S. mainland atop North Korean intercontinental ballistic missiles.

As President, I would deliver a clear message to North Korea that our patience has run out and that we will permit no further testing of nuclear weapons, no further development of nuclear bombs and no further launching of testing of missiles of any range or type. I will also make clear that we are willing to negotiate a treaty with North Korea that normalizes relations in the context of their immediate, verifiable decommissioning of all nuclear weapons and all nuclear weapons production facilities and materials.

I would seek United Nation’s approval of this policy and China and Russia’s military participation in enforcing this policy as needed. But whether or not China and Russia act with us, our country, not theirs is in North Korea’s target zone, and we must act now before the situation gets far more dangerous.

Mr. Trump is correct in saying that China has the most leverage in dealing with North Korea. But they have steadfastly refused to use that leverage to prohibit the movement of all goods apart from food and medical supplies across their border. We could, of course, inform the Chinese that if they trade with North Korea, they will not trade with us. This may reflect Mr. Trump’s thinking. But that strategy would likely simply lead to a trade war with China and do nothing to impair the North Koreans’ nuclear program. A country may be extremely poor yet still be able to assemble formidable military capacities by simply directing a very large share of its very small GDP to its military. (Russia’s tremendous World War II war machine is testimony to this point.)

Furthermore, no American President should entrust our country’s security to a foreign power, particularly one who views us with distrust.

Secretary Clinton has been involved over the years in the numerous failed attempts to resolve the North Korean nuclear problem. Yet I have heard no public commitment by the secretary to suggest it’s years beyond time to draw a line in the sand with North Korea. Her campaign website devotes a full page to national security, but there is not a single reference to North Korea. I find this baffling.

I realize that the course of action I propose is fraught with enormous danger to our country and allies, particularly South Korea and Japan. But inaction holds greater danger. In many ways this situation is similar to the Cuban Missile Crisis. President Kennedy could have chosen to take no action and hope that time would resolve the problem. Meanwhile the Soviet Union would have built up a large arsenal of nuclear missiles just miles from our shores. The risks of doing nothing in that context are similar to those today with one exception. The leaders of the Soviet Union, while despicable jailers of hundreds of millions of people, were rational. Whether the leaders of North Korean are rational is an open question. But there can be no question that confronting North Korea now, when we have the overwhelming military advantage, is the right move for ourselves and for our children.


I believe we should pursue President Obama’s historic deal with Iran that provides partial sanction relief in exchange for limits on Iran’s nuclear activity. We need to make sure that Iran benefits fully from the sanction relief so Iranian voters will understand that moving away from confrontation delivers substantial economic benefits. But we should not permit Iran to continue developing long-range missiles that can deliver nuclear bombs, potentially purchased from North Korea, to anywhere in the Middle East and eventually to anywhere in Europe and the United States. Iran now has highly accurate missiles inscribed with “Israel should be erased from the map,” which can now strike any target in the Middle East.

As with North Korea, we need to tell Iran in no uncertain terms that they will lose their missile production and lunch facilities if they continue to build and test long-range missiles.


ISIS is a hideous menace to humanity. It must be eradicated. Step one is preventing ISIS from occupying any major city on an extended basis. Our policy should be to hit ISIS hard where we can find them and then withdraw. We should not become entrapped in a prolonged ground war either in the Middle East or Afghanistan. Nor should we treat the war on ISIS as primarily our responsibility. At the end of the day, the peoples of the regions affected by ISIS must defend themselves against these barbarians. We can help from the air and with special forces. Step two is getting our allies in the region fully engaged to destroy ISIS. This is their responsibility far more than it is ours. As President I would make crystal clear to our allies in the region that we will fight with them, but not for them, and that I expect to see all branches of the Turkish, Saudi and Gulf States militaries fully engaged in fighting ISIS

The European Union

The European Union needs to emerge from its long economic malaise. The U.S. has a vital national security interest in ensuring this happens. Unfortunately, like the U.S. and Japan, it has decided that it can lift its economic prospects via a combination of monetary and fiscal policy, consisting of printing huge sums of money to pay for euro-member country bills, which also produces very low interest rates. The European Central Bank (ECB) has been at this for a very long time with limited success.

Unemployment in the European Union is close to double that in the U.S. In certain countries, particularly Spain and Greece, the unemployment rate remains astronomical. These and other countries need to engage in further structural reforms that encourage employers to hire. Real wages must be permitted to fall to the levels needed to make hiring in these countries competitive.  Those who prevent this from happening, whether it’s political parties or unions, are doing the unemployed no favors.

The EU should also adopt Limited Purpose Banking and do so on a fast track basis. Under the current monetary and financial arrangements, countries can borrow money from their private banks (sell their bonds to their private banks) and then, as in the case of Greece, threaten to default on their debt. Since the failure of even a few private banks could trigger a massive run on all private banks in the EU (if not beyond), fiscally irresponsible governments have enormous leverage to insist on bailouts. This form of financial blackmail has brought Greek debt relief, but it hasn’t brought the country a return to economic growth. The reason is that the international investment community views Greece as highly risky from a tax perspective since Greece could levy confiscatory taxes on private investments made in the country.

Some have called for a fiscal union across the EU countries. But there is a limit to how much the British, for example, can be asked to pay the bills of, for example, Croatians. What’s needed is a means to break the fiscal-banking blackmail that too many countries in the Eurozone are adopting as an alternative to reforming their labor markets and getting their fiscal houses in order.

Limited Purpose Banking is the perfect solution because once it’s in place, banks can no longer go bankrupt. Indeed, under LPB, there are no banks per se. There are just equity-financed mutual funds, none of which can fail. LPB eliminates the need for fiscal union. It also eliminates the pressure on the ECB to print money to maintain the solvency of private banks who have purchased, no doubt under pressure of their country’s finance minister, far too many government I.O.U.s whose value falls with each debt repayment crisis. Finally, LPB will permit a country like Greece to default on its debt, which may be its best course of action, without facing a bank run.


I am deeply concerned about the direction in which the U.S.-Russian relationship is heading. I’m old enough to remember Nikita Khrushchev pounding his shoe on the UN podium shouting, “We will bury you.” I remember the Berlin Wall being built. I remember the Berlin airlift and watching the Cuban Missile Crisis on our small black and white, grainy TV. I remember crossing through Checkpoint Charley into East Berlin at age 15, while an exchange student, and seeing with horror the bleak city the Wall entrapped. I remember my uncle, a left-wing sociologist, telling me about Joe McCarthy and the Red Scare, which cost many of his friends their jobs. I remember the Vietnam War, which killed and maimed so many even after it was clear that the war was not about stopping Communism but about saving political face. I remember President George H. Bush imprudently and falsely claiming, “We won the Cold War.” All the miscalculations and all the reckless rhetoric by the Russian and American superpowers across all those years achieved just one thing. They repeatedly brought civilization close to annihilation.

During my trips to Russia, I’ve talked with a wide range of people about Crimea, the Ukraine, Syria, NATO and related topics. Two things come across loud and clear. First, the Russians are a very proud and patriotic people. Second, the Russians feel threatened by the expansion of NATO. This doesn’t excuse their forceful annexation of Crimea or their participation in hostilities in Eastern Ukraine. But it does explain it.

Crimea became part of Russia in 1783, but was given to the Ukraine in 1954 by Khrushchev — according to his daughter, as a present. Khrushchev presumably never dreamed that the Soviet Union would dissolve and that Crimea would become the property of an independent Ukraine. Russia is the world’s largest country and doesn’t need more land. But Russia’s Black Sea naval base is located in Sevastopol, which is part of Crimea. Imagine that a U.S. President had handed Hawaii, including Pearl Harbor, to, say, the Chinese, and you’ll get a sense of Russian feelings about Crimea.

The Ukrainians, no doubt, view the gift of Crimea very differently, perhaps as meager recompense for Stalin’s murder, in the early 1930s, of a quarter of its population, including some 3 million children, via forced starvation.

Of course, Crimea was part of an independent Ukraine for the past 16 years. So why did the Russians wait till 2014 to retake it? This connects to NATO’s expansion and Russia’s fear that the Ukraine would join NATO. When the Soviet Union broke up, the Russians believe they were given informal, but nonetheless firm assurances that NATO would not expand into the Baltic States as well as Poland, Bulgaria, Romania. All six of these countries are now in NATO, and four of the six border directly on Russia.

NATO was established to defend the West against the Soviets. But large numbers of Russians worry that its current purpose is to encircle, threaten, weaken and ultimately invade Russia. This seems paranoid until you consider Russia’s long history, which includes invasions by Sweden, France and Germany. Nazi Germany’s invasion was assisted by tens of thousands of Ukrainians. Yes, far more Ukrainians ended up fighting with the Soviets, but the Russian people retain a real fear of “Ukrainian fascists.”

In 2014, pro-Russian Ukrainian President Yanukovich was overthrown in what many/most Russians view as a Western-inspired coup. The Western view is quite different – that the overthrow was a populist uprising against a terribly corrupt leader. Either way, Russians viewed the loss of their guy as step one in Ukraine’s joining both the European Union and NATO.

What followed in Crimea and Eastern Ukraine has established facts on the ground. Russia has guaranteed that NATO troops and armaments won’t be stationed within feet of its Black Sea naval base. And it has established a relatively easy means to destabilize Ukraine if that country becomes too cozy with the EU or NATO. It is also ensuring access to jet engine plants and other factories in Eastern Ukraine that are critical to its military.

But Russia is paying a heavy price for what it views as additional military security. The sanctions are very costly and will hurt more through time. In addition, Western Europe will increasingly wean itself off Russian gas to limit Russia’s leverage. Furthermore, the decision by President Obama to send $3.4 billion in heavy tanks and other military equipment to NATO countries in Central and Eastern Europe will produce further costly rearmament by Russia.

So we now have the absurd situation of two major powers, Russia and NATO, squaring off as if they would actually go to war when both have nuclear weapons and would use them were either invaded. No rational U.S. President would order an invasion of Russia even if it had only a single nuclear-armed missile that could take out San Francisco, New York or any other major U.S. city. And Russia has a vast number of such missiles. Equivalently, no rational Russian President would invade a NATO-member country for fear of losing Moscow, St. Petersburg or some other major Russian city – all in the nanosecond it takes for a nuclear bomb to explode.

The danger of having two schoolboys shout threats in the playground is that one pretends to throw a punch and the other reacts by doing so. With Russian and NATO air, land and naval forces positioned in close proximity, there is a growing danger of an accidental military encounter that quickly escalates into that Cold War acronym – MAD, mutually assured destruction.

The Russians want assurances that the Ukraine will not join NATO. We want the Russians to stop interfering in the Ukraine. As President I would seek to reach a deal with President Putin that contained these elements. But if President Puting wants to impress his citizens with aggressive military behavior that threatens our country and our European allies, he will regret that decision.


China and India are growing so rapidly that they will, by the end of this century, constitute, economically speaking, most of the developed world. This, of course, assumes a smooth economic transition and that our two countries do not return to the long wasted years of mutual fear, animosity and trade restrictions.

Our country needs to be prepared for and welcome China and India’s long-term economic ascendancy. This will be no easy matter. We Americans are used to calling the shots and winning when it comes to global economic and political affairs. But we have learned, through the costly and ultimately unsuccessful engagements in Iraq and Afghanistan, that there is a limit to American power.

Our job with China and India is to prepare them for full partnership with the United States, the European Unio, and Russia in protecting our planet and policing the world. This is far easier said than done. China’s political system is entirely different from our own as is its limited respect for human rights, particularly the freedom of political expression. In addition, it is becoming increasingly aggressive in staking claims to disputed waters and landmasses in the South China Sea.

I’m no expert on China, Russia, North Korea, Iran or any foreign country for that matter. Our country has many such experts, and as President I would make full use of their knowledge and advice. But I have been to China a number of times. I have talked at length with Chinese government officials as well as Chinese academics. I think that, as with Russia, there are things that China seeks in our relationship that we can deliver at a low cost to our national security and economic interests and that there are things that China can deliver, specifically reaching an agreement that shares the South China Sea with its many claimants. Such an agreement would entail China putting maximum economic and, if needed, military pressure on North Korea to lay down its nuclear arms, reaching a solution to the Korean conflict and join with us to help a denuclearized North Korea achieve the same level of prosperity as South Korea has attained.

But let me be clear, I would not sit idly by and let China unilaterally seize and extend land formations in the South China Sea. The U.S. and its Asian allies are China’s top trading partners. I would make clear to the Chinese that continued unilateral expansion of landmasses in the South China Sea absence a final agreement by all parties will lead swiftly to a multi-country embargo on Chinese imports at great damage to all parties involved.


I’m a very strong supporter of Israel, which I’ve visited roughly eight times over the years. I think countries and groups that threaten Israel’s existence, and here I speak primarily of Iran, Hamas and Hezbollah, need to understand that such threats, verbal and physical, must stop or they will pay a price.

Israel lives in an extremely dangerous neighborhood. I don’t think we should tell it how to defend itself. I do think that Israel’s long-term security lies in reaching an accommodation with the Palestinians that a) recognizes a demilitarized Palestinian state, b) shares Jerusalem as the capital of two great peoples and c) ensures Israel’s security. The borders of such a Palestinian state should be based on the long history of negotiations between the two parties. The two parties have gotten close enough over time to an agreement that the parameters of a final, mutually acceptable settlement should be relatively clear. Many U.S. Presidents and secretaries of state have worked long and hard without brokering a lasting agreement between the two sides. I think getting the two sides to shake hands over an agreement is asking too much.  Both sides might, however, welcome an agreement announced by the United States and ratified by the United Nations. I would seek to make that happen if both sides proved receptive.

The Rest of the World

Unlike Mr. Trump, I believe that our country benefits enormously from free trade, including trade with China and Mexico. The idea espoused by Mr. Trump and somewhat echoed by Secretary Clinton that we can prosper economically without open trade is, in my professional judgment, ludicrous.

We need to treat every country and particularly our largest trading partners — Mexico, Canada and China — with enormous respect. The world is a tough place to do business. There is enormous competition, and the business environment is fast-moving and ever-changing. We’ve lost our footing very badly, but blaming our problems on foreign competitors is not going to help us. What it can do is hurt, very badly. The last thing we want is a trade war with Mexico or China or any other country with which we seek to do business.

Our country, as a whole, benefits enormously from foreign trade. It permits us to purchase products from abroad at far lower cost than would otherwise be the case and provides us access to markets all over the world to sell the vast array of products we export. If you want to get a sense of how badly we’d fare were we to eliminate foreign trade, consider how well we’d fare if we could only buy from and sell to people in our state or, even worse, people in our own town.

In this regard, let me make clear that I strongly support the Trans-Pacific Partnership (TPP) agreement. I’ve discussed the agreement with international trade experts and am convinced that the deal is strongly in our country’s interests. The TPP primarily reduces trade barriers facing our exporters rather than reducing our already very low trade barriers facing our importers.

When it comes to the rest of the world more generally, the United States has to make sure it doesn’t focus too much of its attention on Europe, Russia, China, Iran, North Korea and the Middle East. We have important interests in South Korea, Southeast Asia, Africa and Central and South America. We need to help these countries develop their economies and fight their battles against the extremely dangerous Zika and Ebola viruses as well as other contagious diseases, current and future.

We also need to help Africa, and for that matter, the Middle East, deal with their immense population explosion problems. The world at large is on a path to increase its population by 3 billion people over the next 45 years. That’s more than two Chinas, more than seven Americas and more than 37 Germanys!

Much of the growth in world population will occur in Africa and the Middle East. If I had my choice as to where to add 3 billion people, those regions would be last on my list. They are already suffering from overcrowding, poor healthcare, excessive use of fossil fuels, civil war, limited rule of law and infectious disease. There are two major contributions the United States can make to limit population growth in these regions. The first is to assist in the supply and distribution of contraceptives. The second is to provide people with internet banking accounts, which are invested in the global economy at zero cost with one’s account balance accessible at any ATM anywhere in the world.

When impoverished people in Third-World nations choose to have seven children per woman (e.g., Nigeria’s current fertility rate), they are doing so for many reasons. But one of the most important reasons is to provide for their old age. Given the internet and the prevalence of cell phone technology in the developing world, it is now possible to provide the poor with zero-cost ways to save and invest and, ultimately, use their accumulated savings to purchase annuities. Together with economist James Henry, I suggested in a 2005 Wall Street Journal article that the World Bank set up such accounts. The then-President of the World Bank, Paul Wolfowitz, invited us in to discuss the plan. He liked the idea, but never took it up. I imagine that as President, I could strongly encourage the World Bank to become what its name suggests – a bank. In this case, a bank for everyone in the world who needs, but doesn’t yet have, a bank, let alone one that can process remittances at zero cost and that can invest globally at zero cost.