NOTE: This is a repost of a thread I posted around 3 weeks ago. Automod deleted it and the thread only got successfully restored around 10 days later. After request, the mods allowed me to repost the thread so it would be seen and discussed by more people. I will leave the old thread up so the few comments made by other users can still be accessed.
If you posted in the original thread and are interested in your argument being discussed further, feel free to repost your original answer here.
With that said, here's the original post:
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In 1950, China intervened in the Korean war on the Soviet/North Korean side. This decision is usually believed to be mostly due to national security concerns, tensions between the West and the East were high and the Sino-Soviet split had not yet happened. Those were the early days of the PRC, ideology was at a high point and the prospect of being bordered by an US aligned capitalist country would imply that an invasion on Chinese soil could very well be a possibility should the Cold War turn hot.It is to be noted that, at the time, the PRC was not considered to be the rightful ruler of China by the vast majority of non-communist countries as well as by the UN, that they had just done away with Western presence (and interests) following their victories in the civil war and that they did not have access to nukes. As such, they relied on the Soviet support for MAD. Should they lose that support before developing nukes of their own, China would be at grave risk of foreign invasion.
As such, China looked favorably upon a buffer state between them and the Republic of Korea in the form of the DPRK. So much so that they signed a mutual assistance treaty with them in 1961, which is to be (and has been) renewed every 20 years.
While such a treaty could be seen as a sign of a steadfast alliance, there are many reasons which may lead observers to believe that this isn’t the case. First of all, China has often insisted that this treaty would only be valid if North Korea made efforts in order to prevent any actual conflict.
As such, if the the RoK and its allies had valid reasons to launch a pre-emptive strike on the DPRK (over security concerns due to nukes, for example), China could very well judge that those concerns were legitimate and refuse to join the conflict on behalf of the DPRK. Or they could decide they weren’t, and try to stop the conflict by any means necessary. Anyone who views the world through a realpolitik lens will tell you that the PRC’s decision of whether a pre-emptive strike is to be considered legitimate or not wouldn’t be dictated by morality, but by pragmatism.
Would being bordered by a unified (by the South) Korea be beneficial? What would the economic repercussions be? What if the US starts building military bases close to the Chinese border? Or on the contrary, would a unified Korea do away with US presence on their soil? Those are the major questions that will influence Chinese support or opposition to reunification by the South. 10 years ago, a series of documents relating to this issue were leaked. Among them, we can find two important pieces of information:

• The PRC is tired of the DPRK’s military posturing. This seems to still be the case today, as China has supported sanctions on the DPRK over nuclear tests only a few years back.
• According to South Korea’s then vice foreign minister, discussions with Chinese officials had led him to believe that China would not oppose a military reunification by the South, as the South was seen as a much more profitable economic partner and the PRC no longer saw the DPRK’s role as a buffer state as primordial.

I would like to emphasize once again that the second point is from the point of view of a South Korean official. And while he does base this on discussions with actual PRC officials, it is not guaranteed that this was the definitive point of view the PRC would adopt in case of actual conflict. It is however my opinion that they would have. Defending North Korea wouldn’t make a lot of pragmatic sense.
However, those leaks are now over 10 years old. It suffices to say that US-China relations have deteriorated since then. US-RoK relations have also been somewhat shaky at times, although not to the same extent.
As such, I am creating this thread to discuss this; do you believe that China would favor a Korean reunification led by the South? My personal belief is that yes. I believe that there is still hope within the PRC that a stronger South Korea would not necessarily mean a more assertive US, but may, in fact, mean the opposite, as a stronger RoK might be more willing to reconsider their role as an US ally and the US presence in their country. And even if they didn’t, South Korea is a much more potent economic partner than North Korea, it is in fact one of their biggest import and export partners (and China is South Korea’s biggest import and export partner).
As such, I see little they would gain by guaranteeing the DPRK’s sovereignty at any cost. I am however interested in seeing what other people think of this, and I think this sub is the most apt place to discuss this on reddit. I also want to emphasize that I strictly mean to discuss Chinese support or lack thereof for North Korea. I am not interested in discussing whether a military intervention in the DPRK would be good, bad, feasible, likely or anything along those lines.

In 1950, China intervened in the Korean war on the Soviet/North Korean side. This decision is usually believed to be mostly due to national security concerns, tensions between the West and the East were high and the Sino-Soviet split had not yet happened. Those were the early days of the PRC, ideology was at a high point and the prospect of being bordered by an US aligned capitalist country would imply that an invasion on Chinese soil could very well be a possibility should the Cold War turn hot.It is to be noted that, at the time, the PRC was not considered to be the rightful ruler of China by the vast majority of non-communist countries as well as by the UN, that they had just done away with Western presence (and interests) following their victories in the civil war and that they did not have access to nukes. As such, they relied on the Soviet support for MAD. Should they lose that support before developing nukes of their own, China would be at a grave risk of foreign invasion.
As such, China looked favorably upon a buffer state between them and the Republic of Korea in the form of the DPRK. So much so that they signed a mutual assistance treaty with them in 1961, which is to be (and has been) renewed every 20 years.
While such a treaty could be seen as a sign of a steadfast alliance, there are many reasons which may lead observers to believe that this isn’t the case. First of all, China has often insisted that this treaty would only be valid if North Korea made efforts in order to prevent any actual conflict.
As such, if the the RoK and its allies had valid reasons to launch a pre-emptive strike on the DPRK (over security concerns due to nukes, for example), China could very well judge that those concerns were legitimate and refuse to join the conflict on behalf of the DPRK. Or they could decide they weren’t, and try to stop the conflict by any means necessary. Anyone who views the world through a realpolitik lens will tell you that the PRC’s decision of whether a pre-emptive strike is to be considered legitimate or not wouldn’t be dictated by morality, but by pragmatism.
Would being bordered by a unified (by the South) Korea be beneficial? What would the economic repercussions be? What if the US starts building military bases close to the Chinese border? Or on the contrary, would a unified Korea do away with US presence on their soil? Those are the major questions that will influence Chinese support or opposition to reunification by the South. 10 years ago, a series of documents relating to this issue were leaked. Among them, we can find two important pieces of information:
- The PRC is tired of the DPRK’s military posturing. This seems to still be the case today, as China has often supported sanctions on the DPRK over nuclear tests only a few years back.
- According to South Korea’s then vice foreign minister, discussions with Chinese officials had led him to believe that China would not oppose a military reunification by the South, as the South was seen as a much more profitable economic partner and the PRC no longer saw the DPRK’s role as a buffer state as primordial.
I would like to emphasize once again that the second point is from the point of view of a South Korean official. And while he does base this on discussions with actual PRC officials, it is not guaranteed that this was the definitive point of view the PRC would adopt in case of actual conflict. It is however my opinion that they would have. Defending North Korea wouldn’t make a lot of pragmatic sense.
However, those leaks are now over 10 years old. It suffices to say that US-China relations have deteriorated since then. US-RoK relations have also been somewhat shaky at times, although not to the same extent.
As such, I am creating this thread to discuss this; do you believe that China would favor a Korean reunification led by the South? My personal belief is that yes. I believe that there is still hope within the PRC that a stronger South Korea would not necessarily mean a more assertive US, but may, in fact, mean the opposite, as a stronger RoK might be more willing to reconsider their role as an US ally and the US presence in their country. And even if they didn’t, South Korea is a much more potent economic partner than North Korea, it is in fact one of their biggest import and export partners (and China is South Korea’s biggest import and export partner).
As such, I see little they would gain by guaranteeing the DPRK’s sovereignty at any cost. I am however interested in seeing what other people think of this, and I think this sub is the most apt place to discuss this on reddit. I also want to emphasize that I strictly mean to discuss Chinese support or lack thereof of North Korea. I am not interested in discussing whether a military intervention in the DPRK would be good, bad, feasible, likely or anything along those lines.

-> Read BOLD to get the brief account
Edit: sohighyouahobbit and edieoedie make good points about #2. Economic stability ought to be considered the most important factor for political legitmacy.
I'm by no means an accredited expert on China, but I've been living there for just about two years and had a chance to talk to actual Chinese people and I regularly watch Chinese state news, and based on that alone I can help clear up certain ideas that are commonly bandied about when China is discussed from a Western perspective.

1. Political legitimacy is perhaps more important in dictatorships than democracies - it may seem counter intuitive, so let me explain: Destiny obviously is 100% correct in that changes of leadership are a constant pressure felt by democratic leaders and not by their authoritarian counterparts. But electoral systems give the leader a mandate to govern regardless of the size of their constituency, so long as they have won the election; the opposition, their constituency and the general populace accept this rule for a set period. Authoritarians do not have such a framework wherein their power is legitimized by the majority of the citizenry (nor other political factions within the government). While this does mean that they *can* govern without popular support and use other means to maintain power (see Belarus), it is exponentially more difficult--especially in a country with over 1 billion people (this cannot be overemphasized enough) as well as a rich history of popular uprisings.Think of it this way: if political legitimacy were not as important for authoritarians, why would they invest so much in propagandizing their populace? If you can govern without popular support, why crack down on any dissent? The importance of political legitimacy is constantly evidenced in Chinese education, culture and media, where patriotism is a ubiquitous theme and where the accomplishments of the "motherland" are a constantly marketed to the populace (China's main TV channel had a 2-hour broadcast about their highspeed rail on National Day a few days ago). In short, political legitimacy for authoritarians may not be a "real" concern, but is THE most important normative one. Even though there may be no immediate threat of removal for Xi, solidifying political legitimacy is always a key factor in both his governance and presentation, even more key than some of his western counterparts.
2. Prosperity is way too overemphasized a the source of legitimacy for the CCP**.**This is probably the biggest misconception I hear about Chinese governance. If you talk to natives about the benefits of Chinese society (and when they talk about other societies) the factor I hear most about is ZhiAn, which basically means social ordepeace--an absence of crime and chaos. Now obviously one can point to the fact that social order is in part a result of material wealth but this is not necessarily the case; as long as economic conditions do not become calamitous, and, more importantly, there is no perception of unfairness and/or widespread corruption (one of the reasons anti-corruption is one of Xi's biggest projects), China --as it already has in the past--can go through economic troubles without much damage to the gov't's political legitimacy.This then leads to a further point. People care about good governance generally more than economic deliverables. Despite the economic hardships suffered due to the Pandemic, people (I've heard some dissent on this, but by and large) are happy with the gov't's response to the virus (I don't live in Hubei so I imagine it might be different there).
3. Much like the US, the average Chinese person is not very ideologically self-aware. Although there currently seems to be a big campaign to define Xi's visions of Chinese Socialism going on, the average person does not define their perception of the government on ideological terms, particularly not as what DougofCA calls "nationalist Confucianism combined with Communism." On the occasion that you do talk to someone ideologically self-aware, they tend to be dissenters (either Communist OG's or liberals). People who seem content with the status quo speak in vaguely ideological terms (ie: "We defeated the virus because we are socialist/communist and therefore people do their part in society"). When people express approval for Chinese government or society, they do it as a measure of good governance, and particularly maintaining social order. These seem to be greater sources of popular approval than political ideology.
4. **Russia and China are not comparable in the slightest, historically and contemporaneously.**I mean I think this one's obvious and there is not much to be said in this regard. They're both authoritarian but that's pretty much it. The Russian nation is basically an oil powered mafia state sitting on thousands of nukes. The Chinese nation is a export-to-consumer economic hegemon with over a billion people. Just because they were both communist regimes 30+ years ago, does not mean they are comparable today and does not mean that China will have a similar ideological war with the US.
5. War with China is definitely a possibility and we need to be concerned about thisDestiny dismisses this possibility while DougofCA doesn't really comment on it. There will be a contest of economic imperial influence, and I agree with Destiny that this will likely not result in a hot war. BUT, what may lead to war are diplomatic crises concerning these three nations, in order of probability: Taiwan, India and North Korea. Anyone who's studied the history of modern conflicts knows that wars often start due to some contingent event in a third-nation that draws out the great powers due to opportunity or necessity (A.-H.'s ultimatum to Serbia, Hitler into Poland, Korean War). I strongly believe there will be a move on Taiwan in the next 25 years--how will the US react to this? What if China-India border gets hot? What if NK internal politics destabilize and the US want to intervene to safeguard SK? How does China react? Any of these crises, despite the US and China not wanting a hot war, might spiral out of diplomatic control and into conflict if not handled with the utmost caution.

Just as a final note: if you don't know much about China or its motives, the best frame to understand their (particularly Xi, if I had to guess) current strategic objectives is a reversal of the ills that caused so-called "Century of Humiliation." This means the following correctives to the 18th century:
a. Tight control over foreign influence in all forms (China was at the mercy of foreign powers)
b. Tight control over religiopolitical organization (TaiPing rebellion, various apocalyptic sects)
c. Militarization (Inferior military technology and warfare to Europe)
d. Financialization (Opium trade results in a trade deficit and no good fiat currency for internal funding and use among the populace)
e. Regional dominance and good Russian relations (Japanese invasion, Northern vulnerability)
f. Empowering political institutions, reducing official corruption, and increasing accountability to the central gov't (look up the late Qing bureaucracy)
g. Ethnic homogenization, namely making sure ethnic groups like the Uighurs, Tibetans and Mongols don't organize and fight for sovereignty (causing internal instability and a direct threat to ZhiAn), but rather are assimilated into Han Chinese culture.
I don't think China sees itself as an emerging rival to the US, nor do I think that China wants to challenge it for world dominance; rather, China is an independent 3000 year imperial cycle of rises and falls, now in the process of regaining its position as the great hegemon of the Far East, just as the Qing, Ming, Yuan, Song, Tang, Han and Zhou dynasties had done before. I suspect that China does not have much ambition beyond securing its own region (East and Central Asia) and that as long as the US dials down their influence in China's neighborhood, the two nations will live relatively peacefully.

(Note the connections)
CargoMetrics Cracks the Code on Shipping Data
Scott Borgerson and his team of quants at hedge fund firm CargoMetrics are using satellite intel on ships to identify mispriced securities.
By Fred R. Bleakley February 04, 2016
Link to article
One late afternoon last November, as a ping-pong game echoed through the floor at CargoMetrics Technologies’ Boston office, CEO Scott Borgerson was watching over the shoulder of Arturo Ramos, who’s responsible for developing investment strategies with astrophysicist Ronnie Hoogerwerf. At Ramos’s feet sat Helios, his brindle pit-bull-and-­greyhound mix. All three men were staring at a computer screen, tracking satellite signals from oil tankers sailing through the Strait of Malacca, the choke point between the Indian Ocean and the South China Sea where 40 percent of the world’s cargo trade moves by ship.
CargoMetrics, a start-up investment firm, is not your typical money manager or hedge fund. It was originally set up to supply information on cargo shipping to commodities traders, among others. Now it links satellite signals, historical shipping data and proprietary analytics for its own trading in commodities, currencies and equity index futures. There was an air of excitement in the office that day because the signals were continuing to show a slowdown in shipping that had earlier triggered the firm’s automated trading system to short West Texas Intermediate (WTI) oil futures. Two days later the U.S. Department of Energy’s official report came out, confirming the firm’s hunch, and the oil futures market reacted accordingly.
“We nailed it for our biggest return of the year,” says Borgerson, who had reason to breathe more easily. His backers were watching closely. They include Blackstone Alternative Asset Management (BAAM), the world’s largest hedge fund allocator, and seven wealthy tech and business leaders. Among them: former Lotus Development Corp. CEO Jim Manzi, who also had a long career at IBM Corp.
Compelling these investors and Borgerson to pursue the shipping slice of the economy is the simple fact that in this era of globalization 50,000 ships carry 90 percent of the $18.5 trillion in annual world trade.
That’s no secret, of course, but Borgerson and CargoMetrics’ backers maintain that the firm is well ahead of any other investment manager in harnessing such information for a potential big advantage. It’s why Borgerson has kept the firm in stealth mode for years. In its earlier iteration, from 2011 to 2014, CargoMetrics was hidden in a back alley, above a restaurant. Now that he’s running an investment firm, Borgerson declines to name his investors unless, like Manzi and BAAM, they are willing to be identified.
“My vision is to map historically and in real time what’s really going on in economic supply and demand across the planet,” says the U.S. Coast Guard veteran, who prides himself and the CargoMetrics team on not being prototypical Wall Streeters. “The problem is enormous, but the potential reward is huge.”
According to Borgerson, CargoMetrics is building a “learning machine” that will be able to automatically profit from spotting any publicly traded security that is mispriced, using what he refers to as systematic fundamental macro strategies. He calls the firm a new breed of quantitative investment manager. In unguarded moments he sees himself as the Steve Jobs or Elon Musk of portfolio management.
Though his ambitions may sound audacious, one thing is certain: Borgerson doesn’t lack in self-confidence. Over the past six years, he has secretly and painstakingly built a firm heavy in Ph.D.s that can manage a database of hundreds of billions of historical shipping records, conduct trillions of calculations on hundreds of computer servers and systematically execute trades in 28 different commodities and currencies.
For his part, Borgerson seems an unlikely architect of such a serious, ambitious endeavor. Easygoing and fond of joking with his colleagues, he is a hands-off manager who credits CargoMetrics’ investment prowess to his team. His brand of humor comes through even when he’s detailing the series of challenges he had starting the firm. After using the phrase “It was hard” several times, he pauses and adds, “Did I mention it was hard?” Although Borgerson declines to provide any specifics about Cargo­Metrics’ portfolio, citing the advice of his lawyers, performance during the three years of live trading apparently has been strong enough to keep his backers confident and his team of physicists, software engineers and mathematicians in place. “Hopefully, it won’t be too long before we can make a more significant investment,” says BAAM CEO J. Tomilson Hill. Former Lotus CEO Manzi is optimistic about the firm’s prospects: “It has an unbelievable edge with its historical data.”
CargoMetrics was one of the first maritime data analytics companies to seize the potential of the global Automatic Identification System. Ships transmit AIS signals via very high frequency (VHF) radio to receiver devices on other ships or land. Since 2004, large vessels with gross tonnage of 300 or more are required to flash AIS positioning signals every few seconds to avoid collisions. That allows Cargo­Metrics to pay satellite companies for access to the signals gleaned from 500 miles above the water. The firm uses historical data to identify cargo and aggregation of cargo flow, and then applies sophisticated analysis of financial market correlations to identify buying and selling opportunities.
“We’re big-data junkies who could not have founded CargoMetrics without the radical breakthroughs of this golden age of technology,” Borgerson says. The revolution in cloud computing has been instrumental. CargoMetrics leverages the Amazon Web Services platform to run its analytics and algorithms on hundreds of computer servers at a fraction of the cost of owning and maintaining the hardware itself.
At his firm’s headquarters — where the lobby displays a series of colored semaphore signal flags that spell out the mathematical equation for the surface area of the earth —Borgerson leads the way to his server room. It’s the size of a closet; inside, a thick pipe carries all the data traffic and analytic formulas CargoMetrics needs. That computing power alone would have cost $30 million to $40 million, Manzi says.
CargoMetrics is pursuing a modern version of an age-old quest. Think of the Rothschild family’s use in the 19th century of carrier pigeons and couriers on horseback to bring news from the Napoleonic Wars to their traders in London, or, in the 1980s, oil trader Marc Rich’s use of satellite phones and binoculars for relaying oil tanker flow.
Other quant-focused Wall Street firms are latching onto the satellite ship-tracking data. But, Borgerson says, “I would bet my life on a stack of Bibles that no one in the world has the shipping database and analytics we have.” The reason he’s so convinced is that from late 2008 he was an early client of the satellite companies that had begun collecting data received from space and on land to build a large database of all the world’s vessel movements in one place.
That’s what caught Hill’s eye at Blackstone when he learned of Cargo­Metrics a few years ago. BAAM now has a managed account with the firm. “If anyone else tries to replicate what CargoMetrics has, they will be years behind [Borgerson] on data analytics,” Hill says. “We know that a number of hedge fund data scientists want his data.”
But too much reliance on big data can go wrong, say many academicians. “There is a huge amount of hype around big data,” observes Willy Shih, a professor of management practice at Harvard Business School. “Many people are saying, ‘Let the data speak; we don’t need theory or modeling.’ I argue that even with using new, massively parallel computing systems for modeling and simulation, some forces in nature and the economy are still too big and complex for computers to handle.”
Shih’s skepticism doesn’t go as far as to say the data challenge on global trade is too big a puzzle to solve. When informed of the Cargo­Metrics approach, he called it “very valid and creative. They just have to be careful not to throw away efforts to understand causality.”
Another big-data scholar, Massachusetts Institute of Technology professor of electrical engineering and computer science Samuel Madden, also urges caution. “What worries me is that models become trusted but then fail,” he explains. “You have to validate and revalidate.”
Borgerson grew up in Southeast Missouri, in a home on Rural Route 5 between Festus and Hematite. His father was a former Marine infantry officer and police official, and his mother a high school French and Spanish teacher. The family traveled 15 miles to Crystal City to attend Grace Presbyterian Church, which was central to young Borgerson’s upbringing: There he was a youth elder, became an Eagle Scout and received a God and Country Award. The church was across the street from the former home of NBA all-star and U.S. senator Bill Bradley, whose backboard Borgerson used for basketball practice.
When it came to choosing what to do after high school, Borgerson was torn between becoming a Presbyterian minister and accepting an appointment to the U.S. Coast Guard Academy or West Point. He went with the Coast Guard because, he says, “the humanitarian mission really appealed to me, and I had never been on a boat before.”
At the academy, in New London, Connecticut, Borgerson played NCAA tennis and was also a cutup, racking up demerits for such antics as placing a sailboat on the commandant of cadets’ front lawn and leading bar patrons in a rendition of “Semper Paratus,” the school’s theme song. Still, he graduated with honors and spent the next four years piloting a 367-foot cutter — which seized five tons of cocaine in the Caribbean — then captaining a patrol boat that saved 30 lives on search-and-rescue missions. From 2001 to 2003 the Coast Guard sent Borgerson to the Fletcher School at Tufts University to earn his master’s of arts in law and diplomacy. While at Tufts he volunteered at a Boston homeless shelter for military veterans and founded a Pet Pals therapy program for senior citizens.
Following graduation, from 2003 to 2006, Borgerson taught U.S. history, foreign policy, political geography and maritime studies at the Coast Guard Academy, and co-founded its Institute for Leadership. While there he would get up at 4:00 each morning to work on his Ph.D. thesis exploring U.S. port cities’ approaches to foreign policy. He would also travel to Boston to complete his course work at Tufts and meet with his adviser, John Curtis Perry.
Borgerson’s military allegiance runs deep. One weekend last fall he played football in a service academy alumni game. On another he attended the Army-Navy game. Still militarily fit at age 40, the 6-foot-5 Borgerson works out regularly at an inner-city gym aimed at helping youths find an alternative to gang violence; a few weeks ago he was there boxing with ex-convicts and lifting weights.
Leaving the Coast Guard was a hard decision for Borgerson, resulting in part from his frustration with the military bureaucracy’s stymieing of his bid to get back to sea for security missions. With his degrees in hand, he applied for a fellowship at the Council on Foreign Relations. During the application process he met Edward Morse, now global head of commodities research at Citigroup. Morse was on the CFR selection committee in 2007 and recommended Borgerson as a fellow.
Morse introduced Borgerson to commodities, and to trading terms like “contango” and “backwardation.” Morse himself had, earlier in career, gotten the jump on official oil supply data by hiring planes to take photos of the lid heights of oil tanks in Oklahoma’s Cushing field.
Working for the CFR in New York reconnected Borgerson with his Missouri roots. Bill Bradley’s aunt called the former senator to say: “The son of a family who went to our church in Crystal City is in New York. Would you welcome him?” Bradley did — and would later play a part in Borgerson’s career development.
While at the CFR, Borgerson became an expert on the melting of the North Pole ice cap, writing numerous published articles on its implications; this led him to co-found, with the president of Iceland, the Arctic Circle, a nonprofit designed to encourage discussion of the future of that region. Borgerson recently spoke to 50 international generals and admirals about the Arctic and is co-drafting a proposal for a treaty between the U.S. and Canada that would help resolve the differences the two countries have in allowing international ship and aircraft travel through the Northwest Passage.
His Arctic research led to an aha moment early in 2008, while he was still with the CFR, on a visit to Singapore and the Strait of Malacca with his Fletcher School classmate Rockford Weitz and their former Ph.D. adviser, Perry. Seeing the mass of ships sailing through the strait, Borgerson and Weitz decided to build a data analytics firm using satellite tracking of ships.
Like many successful entrepreneurs, the two struggled to find financing before reaching out to a network of friends and their contacts. One was Randy Beardsworth, who had sat with Borgerson at a 2007 Coast Guard Academy dinner, where Beards­worth, then the Coast Guard’s chief of law enforcement in Miami, was the guest speaker. Borgerson “made references to history and literature, and I thought, ‘Here is a sharp guy,’” recalls Beards­worth. “We have been friends ever since.”
But Borgerson didn’t turn to his new friend in his initial fund-raising. “He came to me in 2009, after he had been turned down by 17 VCs, was maxed out on his credit card, was married and had a newborn son,” says Beardsworth, who was reviewing the Department of Homeland Security as part of the Obama administration’s transition team. Beardsworth came to the rescue, not only committing to invest a small amount but introducing his friend to Doug Doan. A West Point graduate and Washington-­based angel investor, Doan took to Borgerson right away. “To be honest, it wasn’t his idea, it was Scott I invested in,” says Doan, who provided $100,000 in capital and introduced Borgerson to a few friends, who added $75,000. Manzi came on board as an investor in 2009, having been asked by Bradley to check out Borgerson’s plan for a data metrics firm. (Manzi knew Bradley from the late 1990s, when the latter was considering a run for U.S. president.)
With Doan, Doan’s friends and Manzi as investors, CargoMetrics was finally able to garner its first venture capital commitment in early 2010, from Boston-based Ascent Venture Partners. That gave the start-up the capital it needed to hire a bevy of data scientists to build an analytics platform that it could sell to commodity-trading houses and other commercial users. In 2011, CargoMetrics added Summerhill Venture Partners, a Toronto-based firm with a Boston office, to its investor roster, raising roughly $18 million from venture capital and angels for its data business.
By then Borgerson had already begun to contemplate converting CargoMetrics from an information provider into a money manager; he saw the potential to extract powerful trade signals from its technology rather than share it with other market participants for a fee. Among those he consulted was serial entrepreneur Peter Platzer, a friend of one of CargoMetrics’ original investors. Platzer, a physicist by training, had spent eight years as a quantitative hedge fund manager at Rohatyn Group and Deutsche Bank before co-founding Spire Global, a San Francisco–­based company that uses its own fleet of low-orbit satellites to track shipping, in 2012. “We had lengthy conversations on how to set up quant trading systems and how [commodities giant] Cargill had made a similar decision to set up its own in-house hedge fund to trade on the information it was gathering,” recalls Platzer. So Borgerson reset his course. Doan describes the decision as a “transformative moment” for the CargoMetrics co-founder. “The military trains you to be a strategic thinker,” Doan explains. “Scott had been tactical until then, making small pivots, and like a general who sees the theater of war, he moved into strategic mode.”
Borgerson’s ambition to succeed was in no small part fueled by the early turndowns by many venture capital firms and a fierce determination to best the Wall Street bunch at their own game. “There’s a lot that motivates me, including — if I’m honest — I have a big chip on my shoulder to beat the prep school, Ivy League, MBA crowd,” he says. “They’re bred to make money, but they’re not smarter than everyone else; they just have more patina and connections.” (Bred differently, he spent last Thanksgiving visiting his parents in rural Missouri. After breakfast he and his father were in the woods, shooting assault guns at posters of terrorists, with Gunny, his father’s Anatolian shepherd dog.)
Borgerson’s plan was not met with enthusiasm from the company’s then co-CEO, Weitz. CargoMetrics had been gaining clients and meeting its goals, and was on its way to becoming a successful data service provider. Weitz, who now is president of the Gloucester, Massachusetts–based Institute for Global Maritime Studies and an entrepreneur coach at Tufts’ Fletcher School, did not return e-mails or phone calls asking for comment. For his part, Borgerson says: “A ship cannot have two captains. The company simply matured and evolved into a streamlined management structure with one CEO instead of two.”
Eventually, Doan went along with Borgerson’s plan. “We believe in Scott and that shipping holds the no-shit, honest truth of what the economy is doing,” he says. But buying out the venture capital firms several years ahead of the usual exit time would require a hefty premium over what they had invested.
Once again Borgerson’s early supporters played a key role. Manzi, a fellow Fletcher School grad who had mentored Borgerson since the company’s early days, put up more money (making CargoMetrics one of his single largest investments) and introduced him to a powerful group of wealthy investors. Separately, the CFR’s Morse suggested that Borgerson meet with Daniel Freifeld, founder of Washington-based Callaway Capital Management and a former senior adviser on Eurasian energy at the U.S. Department of State. Impressed by Borgerson’s “intellectual honesty, vigor and more than four years of historical data,” Freifeld brought the idea to a billionaire third-party investor, who took his advice and became one of CargoMetrics’ largest backers. “I would not have suggested the investment if CargoMetrics had not done the hard part first,” adds Freifeld, declining to name the investor.
A chance encounter in the fall of 2012 gave the CargoMetrics team its first taste of real Wall Street trading. Attending an Arctic Imperative conference in Alaska, Borgerson met the CIO of a large investment firm, whom he declines to name. When Borgerson confided his ambition and that CargoMetrics had developed algorithms to trade on its shipping data once it was legally structured to do so, the CIO suggested CargoMetrics provide the analytical models for a separate portfolio the money manager would trade. Live trading using CargoMetrics’ models began in December 2012. Manzi brought in longtime banker Gerald Rosenfeld in 2013 to craft and negotiate the move to make CargoMetrics a limited liability investment firm. Rosenfeld acted in a personal role rather than in his position as vice chairman of Lazard and full-time professor and trustee of the New York University School of Law. The whole process took a year and a half. During that time Blackstone checked in as an investor.
Bradley, now an investment banker, has yet to invest in CargoMetrics, explaining that he is unfamiliar with quantitative investing. But he may eventually invest in Borgerson’s firm, he says, because “we are homeboys. I believe in him and that things are going to work out ” — pausing to add with a smile, “based on my vast quant experience, of course.”
Borgerson has been in stealth mode since CargoMetrics’ early days, when he moved the firm from an innovation lab near MIT because the shared space was too open. He is much more forthcoming when boasting of the firm’s “world-class talent.” The team includes astrophysicists, mathematicians, former hedge fund quants, electrical engineers, a trade lawyer and software developers. Hoogerwerf, who has a Ph.D. in astrophysics from the Netherlands’ Leiden University, built distributed technical environments for scientists and engineers at Microsoft Corp. Solomon Todesse, who works on quant investment strategies, was head of asset allocation at State Street Global Advisors. Aquil Abdullah, a team leader in the engineering group, was a software engineer in the high-performance-computing group at Microsoft. And senior investment strategist Charles Freifeld (Daniel’s father) has 40 years’ experience in futures and commodities markets, including nine with Boston-based commodity trading adviser firm AlphaMetrics Capital Management.
“All were self-made people; none were born with a silver spoon,” Borgerson notes. One of his blue-collar-­background hires was James (Jess) Scully, who joined as chief operating officer in 2011, after his employer Interactive Supercomputing was acquired by Microsoft.
“The team we built treasures team success, which is Scott’s motto,” Scully says. “We want shared resources, one P&L, not ‘How much money did my unit make?’” Both Scully and Borgerson say Cargo­Metrics is like the Golden State Warriors, a leading NBA basketball team known for putting aside personal glory and playing as a band of brothers having fun.
Borgerson says he fosters a no-ego policy with “lots of play because investment teams are built on trust, and playing together builds trust.” Team building at CargoMetrics includes pub crawls, picnics at Borgerson’s house, poker nights, volunteer work in a soup kitchen for the homeless, Red Sox games and visits to museums.
Trips to the Boston docks or Coast Guard base are intended to remind the CargoMetrics team of the real economy. There are also occasional “touch a tanker” days. On one visit to a tanker, everyone was amazed that the ship was the size of a city building, Borgerson says. “They could smell the salt on the deck,” he recalls. “Wall Street can lose sight of the real fundamentals in the world. I don’t want that to happen here.”
Unlike the Rothschilds 200 years ago, only a small percentage of the trades that CargoMetrics makes relate to beating official government data. Most simply are aimed at identifying mispricings in the market, using the firm’s real-time shipping data and proprietary algorithms.
At a whiteboard in his conference room, Borgerson sketches out CargoMetrics’ general formula. He draws a “maritime matrix” of three dynamic data sets: geography (Malacca, Brazil, Australia, China, Europe and the U.S.), metrics (ship counts, cargo mass and volume, ship speed and port congestion) and tradable factors (Brent crude versus WTI, as well as mining equities, commodity macro and Asian economic activity). Using satellite data with hundreds of millions of ship positions, CargoMetrics makes trillions of calculations to determine individual cargoes onboard the ships and then to aggregate the cargo flows and compare them with historical shipping data. All that leads to the final comparisons with historical financial market data to find mispricings. If CargoMetrics observes an appreciable decline in export shipping activity in South Africa, for example, its trading models will determine whether that is a significant early-warning sign by considering that information alongside other factors, such as interest rates. If Cargo­Metrics believes a decline in the rand is forthcoming, it might short it against a basket of other currencies. “This is like a heat map showing opportunity,” Borgerson says, noting that CargoMetrics is not trading physical commodities. “We are agnostic on whether to be long or short, and let the computers spot where there is a mispricing and liquidity in the markets.” He sums up his simple, but still less than revealing, process by writing on the whiteboard “Collect, Compute, Trade.”
Borgerson says CargoMetrics is building a systematic approach that will work even when cargo cannot be identified — on containerships, for instance. It already knows a large percentage of the daily imports and exports into and out of China and island economies such as Japan and Australia. And although the firm cannot glean from its calculations on satellite AIS data the type of cargo, such as iPhones from China, it can measure total flow, which shows present economic activity. Cargo­Metrics’ data scientists are working on linking such activity to the firm’s data set of the past seven years to measure the evolving global economy. That will lead, Borgerson maintains, to more trades on currencies and equity index futures and, eventually, trades on individual equities. “Uncorrelated” is a mantra of Borgerson and his team. Well aware that correlated assets sent the performance of most asset managers, including hedge funds, plunging in the financial crisis, CargoMetrics is determined to come up with an antidote. Careful not to say too much, Borgerson lays out the simple principle that the process starts with placing many bets among uncorrelated strategies in different asset classes, like commodities, currencies and equities.
The goal is diversification, staying as market neutral as possible and remaining sensitive to tail risk in different scenarios. CargoMetrics’ analytic models help find asset classes that are outliers. Those may include a publicly traded instrument such as oil, another commodity or an equity for which shipping information was a leading indicator during times when other asset classes marched in lockstep. The historical ship data is then blended with this new information to seek opportunities. Identifying mispriced spreads among different trades within an asset class is another way of avoiding the calamity of correlation. Borgerson says the firm’s models will find instances where one type of oil should be a short trade and another a long one. The same goes for whole asset classes — shorting one that will benefit if virtually all asset prices plunge and buying another that will rise when oil prices gain. “We’re counting cards with the goal of being right maybe 3 percent more than we are wrong, as a way of making profits during good times and staying afloat during times of sudden, unpredictable but far-reaching events,” Borgerson says. The key, he adds, “is to know your edge and spread your risk.” CargoMetrics’ uncorrelated approach worked during the dismal first three weeks of this year, says Borgerson. Dialing down risk as volatility in the markets soared, the firm was on track in January to have its best month since it began trading.
To improve the firm’s models, eight of its data scientists hold a weekly strategy meeting, nicknamed “the Shackleton Group” after the band of sailors shipwrecked in the Antarctic from 1914 to 1917. Hoogerwerf and Ramos co-lead the group. At one recent meeting they were deciding how much risk, including how much liquidity, there was in a possible strategy; reviewing whether to keep previous strategies; and assigning who would research new ones.
The Shackleton Group’s meetings are free-form, with a lot of “I’ve got an idea” interjections that disregard official roles. “We hit the restart button a lot,” says Ramos, a former director of business intelligence and a quantitative economist at law firm Dewey & LeBoeuf who joined CargoMetrics in late 2010. “That’s why our motto is ‘Never lose hope.’” A bet on oil, related to Russia’s production, was stopped at the last minute in 2014, when Russia invaded Ukraine. Some currency-trading strategies have been abandoned in theory or after failing. Strategies the Shackleton Group likes are passed on to the firm’s investment committee of Borgerson, Scully and Ramos for a final decision. CargoMetrics has a unique set of big-data challenges. Historical shipping patterns may not be as useful in the new global economy now that shipping freight prices are plunging, a sign that trade growth rates may be changing. And analysts point out how hard identifying oil cargo can be in certain locations and instances, even in more-­predictable economic times. “While it may be easy to say that ships leaving the Middle East Gulf are typically carrying crude oil, knowing the type of crude is sometimes quite difficult,” says Paulo Nery, senior director of Europe, Middle East and Asia oil for Genscape, a Louisville, Kentucky–based company that analyzes satellite tracking of ships. Borgerson maintains his team is well aware of the dangers of data mining and getting swamped by noise. “If you run computers hard enough, you can convince yourself of anything,” he says. To make sure CargoMetrics’ algorithms for identifying cargo are valid, the firm spot-checks manifest data filed at ports and imposes statistical confidence checks to guard against spurious correlations.
Getting the jump on official government statistics is likely to become tougher too thanks to the recently formed High-Level Group for the Modernization of Official Statistics. Although the U.S. is not a member, Canada is a key player helping to lead the mostly European nation group (including South Korea) in coming up with a global blueprint for measuring and reporting economic activity.
Reflecting on his journey to Wall Street — raising money, hiring employees with different skill sets, making changes to Cargo­Metrics’ culture, overcoming legal and regulatory hurdles — almost gives Borgerson second thoughts about whether he would do it again. “I’ve sailed ships through tropical storms, captured cocaine smugglers and testified before Congress [on his Arctic research],” he says, “but this was the hardest.”

Well, boys, I reckon this is it - nuclear combat toe to toe with the Roosskies. Now look, boys, I ain't much of a hand at makin' speeches, but I got a pretty fair idea that something doggone important is goin' on back there. And I got a fair idea the kinda personal emotions that some of you fellas may be thinkin'. Heck, I reckon you wouldn't even be human bein's if you didn't have some pretty strong personal feelin's about nuclear combat. I want you to remember one thing, the folks back home is a-countin' on you and by golly, we ain't about to let 'em down.
Major Kong, Dr. Strangelove or: How I Learned to Stop Worrying and Love the Bomb [quote here] [full film available here at archive.org, highly recommend, definitive American dark comedy on the subject]
Hello! We're sort of taking a break from East Asia-specific this week to talk about a great conversation-starter: Thermonuclear war. As developments in this area have not entirely halted in the past few decades, and yet I suspect most [not all--there's probably like one 80-year-old or something] of the readers of this post were either not alive during the Cold War or were too young to really appreciate most of what was happening during that period, I feel that it's important to cover the topic, especially with "great-power competition" being a new buzzword and the possibility that the NPT and the other arms control and limitation agreements that have been prominent for the past few decades falling apart being very real.
I'm sorry in advance if I occasionally get a bit repetitive but I think I've made a fairly comprehensive post on the subject, and I don't think I've particularly biased it one way or the other [though of course, that's what I would think].
Glossary:
Bunker-buster = nuclear warhead designed to destroy hardened sites, like bunkers or missile silos
Nuclear weapon = nuclear bomb = nuclear warhead = weapon that uses an operating principle based on nuclear physics
Thermonuclear weapon = more advanced type of nuclear weapon that uses fusion as its primary energy source rather than fission
Warhead = the part of the weapon that goes boom
Fuze = what sets off the bomb, distinct from fuse, which is an electrical part
Intermediate Range Nuclear Forces Treaty = one of the biggest arms control treaties in recent years, barred the US and USSRussia from having land-based missiles that were nuclear capable with a range from 500km to 5500km]
Ballistic missile = missile that travels in ballistic trajectories, fast, difficult to intercept, accuracy problems and always powered by rockets
Cruise missile = missile that travels in the atmosphere, smaller, difficult to intercept but easier than ballistic missiles--but harder to detect, powered by jet engines and air-breathing and thus slower
SRBM = Short-range ballistic missile [1000km range or less, most less than 300km to comply with MTCR or less than 500km to comply with the former INF Treaty]
MRBM = Medium-range ballistic missile [1000km to 3000km range, common in arsenals outside the US and Russia]
IRBM = Intermediate-range ballistic missile [3000km to 5500km range, common in arsenals outside the US and Russia, previously barred by the INF Treaty
ICBM = Intercontinental ballistic missile [5500km+ range, standard in US and Russian arsenals, China, France, and possibly North Korea operate a handful]
SSBN = "boomer" = ballistic missile submarine, nuclear powered and nuclear armed [no conventionally armed ballistic missile subs exist at present to the best of my knowledge, the only proposal being known a Trident conventional version]
Early warning = the systems used to detect missile launches and track them, could be ground-based radars or satellites
MIRV = Multiple independent reentry vehicles, a way to attach multiple warheads to one missile
SLBM = submarine-launched ballistic missile
Tactical nuke = determined by usage, not yield, tactical nukes are meant to be used in conflicts that do not escalate to an all-out nuclear war
Countervalue = a capability to strike against an opponent's cities and hard targets
Counterforce = a capability to strike against an opponent's hardened missile silos
Gravity bomb = nuke dropped from a plane
Nuclear triad = the full set of nuclear delivery methods: Air-launched cruise missiles/bombs, submarine-launched missiles, and ground-based missiles
SDI = "Star Wars" = strategic defense initiative, the origin of all of America's modern missile defense efforts
ABM = anti-ballistic missile
Nuclear sharing = a system via which nuclear warheads, owned by the US, are located in NATO countries [and in the past non-NATO countries] and can be turned over to their management in wartime
Some particular pieces of hardware to know about:
Trident = the submarine-launched ballistic missile currently used by the US and UK, can carry up to 14 warheads in MIRV configuration [typically 4 under treaty limits], solid-fueled and an ICBM as well as a SLBM
Minuteman-III = the current ground-based nuclear deterrent of the United States, ICBM, also MIRVed to handle 3 warheads, built in the 1960s originally and solid-fueled
Peacekeeper = MX = LGM-118 = the most sophisticated ground-based ICBM fielded by the United States and, possibly, by any power, solid-fueled and carried 12 [limited by treaty to 10] MIRVed warheads. Retired in 2005 due to high cost and arms limitation treaties. Meant to replace Minuteman.

1. The Bomb

The very first nuclear bombs relied on fission, the power of splitting atoms of fissile material to generate vast amounts of energy very quickly in a chain reaction. The general principle here is critical mass. Once a critical mass of the fissile material is achieved--usually either Uranium-235 or Plutonium-239--it activates a chain reaction which results in a nuclear explosion. These bombs are very simple in operating principle--pretty much anyone could build one if given the requisite materials. The main problem, and the reason we have not yet seen a nuclear warhead DIY, is that the fissile materials are very difficult to get. One must either synthesize plutonium in an atomic pile or use one of the various methods developed to enrich uranium--gaseous diffusion and centrifuges being the major ones. Either one takes a significant amount of time and specialized equipment, at least to produce nuclear weapons in any quantity. However, when you get down to it, any sufficiently motivated group could build one of these--at least if not stopped by another, more motivated group. Even North Korea could do this.
The next step in evolution was the boosted fission nuke. It represented a nuclear weapon that was more capable, but not radically so. By adding fusion fuel to the nuclear weapon, specifically the fission assembly, you could get a better yield--splitting more of the atoms in the core assembly before it suffered a critical existence failure and got spread out over several square miles. Fission-boosting is also fairly easily done, with the main obstacle being obtaining enough deuterium, lithium, and/or tritium to do the job correctly. These are, to my knowledge, pretty seldom seen; but I would suspect that both Pakistan and North Korea have them.
Thermonuclear weapons are, however, a major leap in capability. Much larger yield warheads can be built, in the multi-megaton range, and miniaturization is also possible, which is very useful for missiles in particular. Thermonuclear weapons rely on adding a fusion "secondary" stage, which is set off by a "primary" fission stage and generates vast quantities of energy. However, thermonuclear weapons are much more difficult to develop than fission-based weapons; largely because they rely on exotic materials and classified physics to operate. The United States itself has had difficulty building new thermonuclear weapons, or refreshing ones in current inventory, because it has lost knowledge of how to build some key materials. Most nuclear powers, however, are believed to or known to possess thermonuclear weapons, the exceptions being Pakistan and North Korea.

2. The Cold War

Nuclear weapons were probably the defining feature of the Cold War, at least once it finally began in earnest in the 1950s. To this day, the Cold War defines the cultural conception of nuclear weapons.
What this is about, though, is more a mechanical than philosophical or sociological discussion, explaining why nukes were, and are, used. Or rather, are planned to be used, because despite hundreds of nuclear tests, nobody has ever used a nuclear weapon in wartime in just over 75 years, since the US dropped a crude plutonium device on the Japanese city of Nagasaki.
The very beginning of nuclear war involved hundreds of strategic bombers--first B-29s, which actually cost more than the Manhattan Project to develop--and then more advanced jet bombers, the most iconic of which and perhaps the most enduring is the B-52 Stratofortress, which the US Air Force expects to remain in service through possibly the end of the century. These were the only viable delivery vehicles, and thus both the US [well, mostly the US] and the Soviet Union rushed to build as many of them as possible, with [unfounded] concerns of a "Bomber Gap" resulting in the construction of thousands of strategic bombers. In the event of war, these bombers would take off from their bases and drop nuclear bombs on enemy positions. For a substantial length in time, the US actually maintained a constant patrol of B-52 bombers with nuclear warheads onboard, which, in the event of a surprise attack, would retaliate against the USSR. It is one of these bombers which Dr Strangelove focuses on--though I should note that only a handful of people actually possessed the ability to launch a nuclear strike, and even then only in contingencies when the president was unavailable, and this persists to this day, excepting submarines--which will be mentioned in a moment.
However, technology marched on, and soon the ballistic missile became the delivery vehicle of choice. Early ballistic missiles were relatively crude, based off of the original V-2 design and whose quality was largely determined by how many Nazis you had stolen at the end of the Second World War. However, technology continued to evolve, and soon ICBMs had enough accuracy to launch countervalue attacks. These attacks targeted cities and aimed to deter an enemy from launching a first strike by ensuring that doing so would destroy the nation of the attacker. This doesn't mean that ballistic missiles were the only delivery method, though. Smaller nuclear weapons were built, designed to be delivered by air. They offered greater accuracy and tactical utility, and lowered the risk of a strategic nuclear exchange breaking out. It was around this time that tactical and strategic nuclear exchanges began to be devised in nuclear theory, with tactical nukes becoming essential to NATO war plans due to the numerical, and sometimes qualitative, inferiority of their conventional forces when faced with Warsaw Pact opponents. Nuclear weapons found their way into practically every kind of format. Nuclear-tipped air-to-air rockets were an early invention, aimed at shooting down massed bomber formations. Nuclear-tipped surface-to-air-missiles soon followed. Nuclear anti-ship missiles, nuclear artillery, and even "backpack nukes" like the Atomic Demolition Munition all were developed for a variety of purposes. Nuclear depth charges, nuclear torpedoes--if you put explosives in something, chances are someone drew up a plan to put a nuke in it. [as an aside, Cold War schemes to use nuclear weapons to perform massive construction projects, such as liquidating the Athabasca Tar Sands or creating a giant salt lake in Egypt, are one of my favorite Cold War relics]. Nukes were the bread and butter of Cold War strategy in a way that seems hardly conceivable today. This is largely why both the US and USSR had stockpiles of tens of thousands of weapons.
Mutual assured destruction, or MAD as it is commonly known, was also derived during this time, suggesting that the way to prevent nuclear war was by ensuring that any initiation of nuclear combat would lead to certain destruction. The development of SSBNs and SLBMs, which provided a way to ensure survivability of the nuclear arsenal and a sure second strike capability--usually countervalue because of the lower accuracy of SLBMs--seemed to make this set in stone. These would avoid destruction in a first strike by hiding within the ocean, and would then launch based off of orders issued from base--or, in the case of Britain, off of orders written by the Prime Minister and secured in the submarines to be opened in event of war.
Unfortunately, life tends to make things more complicated, and this was and is the case with MAD. The first problem that developed was that of the MIRV, or Multiple Independent Reentry Vehicle. This allowed missiles to carry large numbers of warheads, as many as twelve in the case of the LGM-118 Peacekeeper [probably the most sophisticated ICBM ever developed, the Soviet R-36 threw 10 and Trident D5 14 smaller warheads]. As a result of this fact, combined with increasing accuracy of reentry vehicles [especially, it is thought, on the part of the United States], a counterforce strike that could eliminate an enemy's ground-based nuclear deterrent became possible. MIRVs also place a high value on first-strike because each MIRVed missile can destroy numerous enemy silos but is correspondingly more vulnerable to first-strike as it replaces a dozen independent missiles with a single one. As a result limitations of MIRVed warheads have been a major focus of arms reduction treaties and several attempts have been made to ban usage of the technology altogether. Other problems complicated the situation further, such as anti-ballistic missiles, which potentially could shelter a nation from a weak second-strike. However, this broadly describes most of the key elements of nuclear war, skipping over the vast cultural and political impacts of nuclear weapons for the most part, because that's not really what I'm focused on here.

3. Arms control and non-proliferation

From the moment the US first got its hands on the bomb, it sought to keep it away from everyone else, including a very miffed Britain which had been promised access to the secrets learned from the Manhattan Project as a result of the contributions of its "Tube Alloys" program to the American development of the bomb. The Atomic Energy Act of 1946, or McMahon Act, has largely set American nuclear policy since its creation. Britain ultimately developed its own nuclear bomb, and the Soviets, in a large part thanks to the involvement of traitorous American nuclear scientists, developed their own bomb as well. By the 1950s, the world was in a frantic race to build the bomb--those who had it, to build more of them, and those who didn't, to get them. Even Sweden ran a nuclear weapons program. France got the bomb, and China did as well--much to the chagrin of the Soviets, who had undergone a dramatic split with the Chinese a few years earlier and whose original research work was invaluable in contributing to the Chinese nuclear program. It must be understood that back in those days building nuclear weapons was much more difficult than it is now, without computers or without even easy resources as to how they functioned. Nowadays, I can learn how to build a nuke off of Wikipedia, and, barring the ten tons of heavy water, hundreds of kilograms of natural uranium, and large quantity of nitric acid required, doing so is a relatively trivial task.
The real shift, however, began around 1970. The first major act in this was the development of the Non-Proliferation Treaty, in which all the nuclear powers promised to work towards the reduction and abolition of nuclear weapons, and in return the majority of non-nuclear powers agreed not to build nukes, and it is upon this foundation that the modern order is built. However, it has hardly proved perfectly successful--only six years later the detonation of the first Indian nuclear weapon occurred, which had been built using Canadian technology that had not been adequately controlled, or, indeed, controlled at all--the reactors Canada sells are, by the way, essentially DIY kits for nuclear weapons. As a result, an increasingly involved control regime began to be built. The IAEA was founded and membership was generally required for the ownership of nuclear reactors. The nuclear powers banded together to ensure that critical components of nuclear programs were not exported, pressured nations in their own blocs into cancelling nuclear programs [as the US did to both South Korea and Taiwan], and, barring some relatively low-profile cheating on the part of China, which has sold peripheral equipment to North Korea, Pakistan, and Iran, this vast patchwork mostly held together. As a result, instead of a predicted 30-40 nuclear weapons states, there are only 9 today.
Also around this time, both the US and USSR recognized that spending large quantities on building ever-increasing quantities of nuclear weapons without either side gaining any decisive advantage was helping absolutely nobody, and the two states began to agree to various reductions in arms and limitations in weapons development, including the ABM treaty and SALT.

4. Anti-ballistic missiles and Star Wars

Eventually, starting in around the 1970s, people got the idea that maybe you could stop ICBMs. This sounds absolutely ludicrous--but it wasn't, per se, impossible, and it led to a lot of really advanced, science-fiction sounding technology.
The very first method was to launch interceptor rockets that carried H-bombs of their own, aiming to detonate them close enough to the missiles that they would either destroy the reentry vehicles, their electronics, or cause a non-critical "fissile" of the warhead. This was halted, however, by the 1972 Anti-Ballistic Missile Treaty, one of the first big arms limitations agreements, and also by a simple fact: Ground-based missile interceptors are generally much more expensive than building additional missiles--for instance, the US Ground-Based Midcourse Defense costs more to produce, missile for missile, than a LGM-118 with 12 warheads. This treaty actually held for its full term, despite what you may have expected, as it did not limit research, only the actual building of anti-ballistic missile systems, and actually, IIRC, excluded space-based defenses via omission. However, until Ronald Reagan came along, the idea of ABMs was largely cast to the wayside.
Reagan, however, revived the idea quite famously in his Strategic Defense Initiative, dubbed "Star Wars" by many. It explored a number of ideas, many of which were quite outlandish--one of the more successful proposals, at least in terms of how much funding or attention was devoted to it, involved setting off nuclear warheads in space to power x-ray lasers to shoot down enemy missiles, which if nothing else sounded really cool. By far the most practical program to emerge out of this, however [a rather relative merit], was called "Brilliant Pebbles". It relied on a constellation of tens of thousands of kinetic interceptors, small, only a few kilograms each, which would target and destroy any ballistic missiles in low orbit. This plan was supposed to solve the issue where interceptors were more expensive than missiles, and allow the US unquestioned missile superiority.
It was also around this time when surface-to-air missile systems, originally designed with the mission to shoot down aircraft, began gaining limited anti-ballistic missile capabilities, which were... somewhat underwhelming in the Gulf War, though the technology was brand new at the time.

5. Peace dividend

When the Cold War finally ended, one of the parts of the peace dividend that probably made more sense than most was the vast savings made on nuclear weapons. The trend had already begun in the late Cold War, but once the Berlin Wall fell and the Soviet Union collapsed, stockpiles fell from tens of thousands of warheads to just a few thousand on the part of the US and Russia. All sides had a vested interest in arms reduction, and so those thousands of warheads were disassembled and largely turned into fuel for nuclear reactors.
Ballistic missile defenses also got cut. The original Brilliant Pebbles scheme was cancelled and replaced with a less-expensive but substantially less effective program called the Ground-Based Midcourse Defense, which relies on a relative handful of interceptor missiles in Alaska to shoot down ballistic missiles in the midcourse stage; primarily designed with China or North Korea in mind [oddly enough the first ballistic missile defense program of the US was also designed with the intent of stopping a Chinese nuclear attack]. Ironically Ground-Based Midcourse Defense ended up costing a large portion [more than half] of what the final Brilliant Pebbles implementations were proposed at, for a system with very limited capabilities [this cancellation may have also been part of what killed the DC-X spacecraft].
Vast fleets of SSBNs were disassembled. Expensive delivery platforms and programs, like the MX Peacekeeper, were scrapped. All in all, the threat of nuclear war practically vanished, excepting on the subcontinent, where India and Pakistan engaged in nuclear showboating multiple times. It's really hard to understate the sheer magnitude of what happened, with the number of warheads in existence shrinking from around 70,000 to 10,000 or so, with around half of those today being inactive. The US Navy went from stocking multiple warheads on each ship to removing them entirely from the fleet, aside from, of course, the SSBNs.
The successor states of the USSR, aside from Russia itself, were successfully convinced to hand over their nuclear weapons in exchange for security guarantees--Ukraine most infamously--and their fissile materials were turned into [relatively] harmless nuclear fuel. South Africa became the first nation with an independently developed nuclear arsenal to voluntarily denuclearize, admittedly largely out of fear of what the black population might do with the bomb.
Other areas saw major reductions and non--proliferation efforts. The Nunn-Lugar Cooperative Threat Reduction Program decommissioned large quantities of nuclear delivery vehicles and Soviet biological and chemical weapons sites. The Missile Technology Control Regime expanded and enveloped most nations with the capability to develop ballistic missiles and long-range cruise missiles, making nuclear weapons delivery difficult for the aspiring third world dictator--for instance, an Iraqi program to develop a ballistic missile in partnership with Argentina was scrapped by American pressure and Argentine admittance into the MTCR. While India and Pakistan still harassed each other, their open non-nuclear conventional war assuaged some concerns while raising others [perhaps nuclear powers could engage in conventional war after all]. Nuclear programs in several countries were stopped by diplomatic pressure, as in Libya, rather than by Israeli bombing campaigns.
For a time, all was peaceful. In the last decade or so, however, things have changed--and for the most part, they have done so below the radar of even Washington policymakers.

6. A Return To The Old Days?

Things in the past decade or so, however, have changed the nuclear situation substantially.
First on the list is that North Korea now has nuclear weapons and, it seems, a deterrent. This has seriously tested the efficacy of non-proliferation already, with the merit of non-proliferation when North Korea and Pakistan have weapons being rather suspect. Iran is also building nukes. North Korea's case was, and is, dangerous in particular because it suggests that, barring strong support from a great power, nukes are the only way to maintain autonomy [Ukraine and Libya both offering examples of why surrendering nukes, or even a nuclear program, is a bad idea to the world], and that they aren't too difficult to get. North Korea also may well already be engaging in proliferation activities as a revenue source--it's already known that they sell ballistic missile delivery vehicles and have exported materials related to chemical weapons production in the past, so exporting nuclear technology is hardly a stretch, especially given that North Korea is not seriously threatened by these activities and they provide a useful revenue source for the regime. As a result, the non-proliferation circle built over decades by the various great powers now has a rather large North Korea-shaped hole in it. This, however, isn't leading to big changes in Russia, China, and the United States. Rather, technological advancements, largely by the US and China, are slowly nibbling away at the tenuous nuclear peace.
Second is the problem, for Russia, created by the new Trident super-fuze. Under cover of a "refurbishment" of the Trident warhead family, a new fuze was introduced. However, this fuze is no mere one-for-one replacement: Instead, it allows the warhead to detonate within a range of zones that could destroy the target, allowing warheads that would previously overfly the target and miss to instead detonate in an airbust directly above said target. In effect, it increased the power of Trident by as many as five times, and has made it into a counterforce or first strike weapon. Quoted figures are a .86 probability of kill for a 10kpsi target, about as hard as defensive structures get, and .99 probability of kill for a standard, 2kpsi hardened target. As most of Russia's missile silos are only secure to the point of the latter, and Russia uses liquid-fueled ICBMs for the most part that are much more sensitive to attack than Western or Chinese solid-fueled ones, what this means is that Trident is now capable of wiping out Russia's entire ground-based strategic deterrent at extremely short notice. This has, it seems, quite possibly frightened Russian leadership, and is the likely reason why they have been desperately trying to devise new outlandish delivery vehicles, like an unmanned nuclear torpedo or a nuclear-powered cruise missile. This is further complicated by the fact that Russia has more or less completely lost its space-based ballistic missile warning network and does not seem to have the capability to replace it, which means that Russia must rely on land-based early warning radars to inform it of a nuclear strike. As a result, Russia will have as little as ten minutes of warning for an incoming nuclear attack, and will have essentially no idea what it will look like or what scale it is on. When Russian sources say they'll treat any ballistic missile strike as a nuclear attack, they probably aren't lying, because their sensor network is so bad they can't tell whether a sounding rocket is a nuclear first strike, and their survivability is so bad they can't afford to not launch.
There's also the interesting problem presented by the development of a new low-yield Trident warhead. While it might possibly have some use, many believe that low-yield nuclear weapons are dangerous because they blur the line between conventional and tactical nuclear war, and the use of Trident as a delivery vehicle runs a substantial risk on account of the fact that it may be difficult for an adversary [such as Russia] to discern that the vehicle is a tactical nuclear strike rather than the beginning of a strategic exchange. These same very concerns scuppered a conventional variant of Trident proposed for the Prompt Global Strike program, which would have used Trident to launch large conventional payloads, a bad idea for multiple reasons.
Arms agreements that defined the 1990s and 2000s have also begun to fall apart. The cancellation of the Intermediate-Range Nuclear Forces Treaty was just the latest in what has been a slowly escalating trend since the 2002 expiration of the anti-ballistic missile treaty. The Plutonium Management and Disposition Agreement, for instance, which required the US and Russia to convert their stockpiles of plutonium into MOX reactor fuel, is also dead, ostensibly for financial reasons on the part of the US, but quite possibly to allow the US to retain its 80+ tons of plutonium in a diluted form so it can be easily converted back into warheads [keep in mind only a few kilograms of plutonium is needed for a warhead so we're talking about thousands of devices in the several hundred kiloton range].
Why this is happening is an interesting question, and it seems that both the US and Russia [but, to be honest, mostly the US] are involved in the end of these arms restriction treaties. The first problem, and most obvious, is China. China has a general policy of not engaging in arms-limitation treaties, viewing them as a way for dominant powers to retain their position, and has a nuclear arms reduction policy that amounts to "get rid of all of your nukes and then we'll talk". With China becoming an increasingly significant threat to the United States, the arms controls placed on it by agreement with Russia have become problematic for American strategic planners. In particular, the limitation on intermediate-range forces was seen as a major difficulty given the increasingly capable conventionally armed intermediate range ballistic and cruise missiles that are one of the edges the PLAN holds; and, I suspect [but cannot prove] that planners within the US government view tactical nuclear war with China as a very real thing they should plan for, with the US using nukes first to gain a decisive tactical advantage and not escalating to a strategic exchange--this is enabled by the fact that China has essentially no tactical nuclear weapons, seems to believe it can avoid nuclear war with the United States [or possibly not--I've heard both], and a very small strategic stockpile of which only around 50 missiles can hit the continental US. Russia, on the other hand, has a rather different problem. Its conventional forces in Europe are inferior in quality and quantity to what NATO can field, so it has to plan to make up the difference with nuclear weapons. Furthermore, the increasing sophistication of American capabilities in ways which Russia simply cannot match means that the survivability of the Russian nuclear force is beginning to be called into question, and thus a larger arsenal is required to ensure that a strategic deterrent can be maintained as it has traditionally. As a result, both parties are abandoning arms treaties with, well, reckless abandon.
Finally, the development of increasingly capable ballistic missile defenses, especially by the United States--which now holds pretty much all the cards in the event of nuclear war--means that nations will be required to develop either new and more sophisticated delivery vehicles, or, alternatively, produce more warheads, to ensure that they can maintain deterrence. These include the SM-3 anti-ballistic missile, which can intercept ballistic missiles in the midcourse stage, though only shorter ranged ones and not full ICBMs at the moment, and which is being deployed by the US not only aboard its numerous destroyer fleet but also in "AEGIS Ashore" sites in Eastern Europe [which also caused concern by Russia because these units could easily fire ground-launched cruise missiles that were banned under the Intermediate-Range Nuclear Forces Treaty], and were to be deployed in Japan before local opposition halted construction. The US also designed THAAD, or Terminal High Altitude Area Defense, which provides an interceptor to destroy even ICBMs in the terminal stage, and has made significant improvements to the Patriot missile system which enhance its ABM capabilities. The US has also discussed reviving technologies from previously abandoned schemes such as the YAL-1, a 747 that aimed to shoot down ballistic missiles with lasers at a range of hundreds of kilometers [though it was suggested the new implementation be on a stealth drone] and even considered further research into space-based interceptors--which seem far more feasible in a day and age when private companies are already putting up constellations of advanced communications satellites in similar numbers to those proposed for the "Brilliant Pebbles" scheme.

7. Conclusion

As a result of these shifts, the current lull in nuclear war preparations and small nuclear arsenals of today may not last much longer. Indeed, to an extent, the lull has already ended.
Without a doubt Biden will try to negotiate a renewal of New START--he himself has stated his intent to do so multiple times, but the short time window he has in which to renew it [it expires on 5 February 2021, little more than a week after his inauguration] means that whether he will be successful is uncertain. Even if New START is renewed or brought back in a new form I would expect it to be much less restrictive and a de facto abandonment of the arms reduction that has characterized the last thirty years of nuclear policy. I also don't think that New START, even extended, will last past 2026--that's the point when major nuclear modernizations are set to begin to the US arsenal, including the introduction of the Columbia-class SSBN into service and replacement of the 1960s-era Minuteman III ICBM that constitutes the ground-based deterrent.
Both the US and Russia are poised to make major modernizations to their nuclear arsenals and I expect both of their stockpiles to grow barring a renewal of New START as presently constituted. I also expect that the US may well begin preparing to build new facilities for nuclear weapons production, as its old ones have pretty much all closed at this point. Nuclear weapons may also begin to see a return to the naval field, with nuclear-tipped anti-ship missiles and torpedoes possibly seeing revivals--watch for a return to the US's historic nuclear ambiguity policy on whether or not its ships carry nuclear weapons.
New forecasts say that China is poised to double its nuclear arsenal in the next decade, and I suspect these ones will actually turn out, because China knows that their arsenal at present is too small to pose an effective deterrent to tactical nuclear war and may, within a relatively short time, become an ineffective strategic deterrent.
The list of states with nuclear weapons is likely to grow--South Korea is a near sure bet for reasons I have described previously, but I would not be surprised to see more states get the bomb. Iran seems likely to build one unless stopped via force, and they've gotten quite close already. However, more than the number of states which will possess nuclear weapons outright will grow, I predict a major expansion in nations which attempt to reach a nuclear-latent state. The recent burst of smallsat launchers provides a perfect cover for ballistic missile systems to be developed; drone technology and electronics have made cruise missiles easier than ever to design, and nuclear power will be sought after by a large number of states with potentially ulterior motives--once a sufficient stockpile of used fuel is made reprocessing it to extract the plutonium within is relatively trivial, and I expect more states to push for reprocessing technology and "full control over the nuclear fuel-cycle". As a result, strategic planners may ultimately have to reckon with a world in which most nations [or far more than the 9 current nuclear-armed states] could well develop modest nuclear arsenals within a few months to a few years.
As for what the US should do--well, my opinion is that the US should just embrace the inevitable. During the Cold War, the US saw that France wasn't going to be stopped from building the bomb--so instead they helped the French build their weapons and thus gained the trust and friendship of the entire French strategic community, at least to an extent where their nuclear and even conventional forces were de facto reintegrated into NATO.
That has lessons for today, I think. If something is going to happen one way or another, the US should just embrace it and try to help the process along and gain the trust and friendship of the nation involved, provided such a move is not directly contrary to American interests. For instance, take South Korea. If it becomes clear that South Korea intends to build nuclear weapons, the US would be better off discretely enabling that by amending its Section 123 agreement and clandestinely supporting the program than trying to fight it.
The US should also seriously reconsider whether it should maintain a non-proliferation stance, although I can see strong cases on both sides. Non-proliferation has failed to stop Pakistan or North Korea, and at that point it's really rather questionable whether it works, but for the moment it's the only thing that's holding the Middle East and world as a whole back from a nuclear arms race. If Iran does get the bomb, I doubt that the US will continue to hold onto that position. At that point [or this point] most of the nations the US doesn't want to have the bomb either already have it, cannot be stopped from getting it without war, or just flat out can't build it due to lack of money, will, and resources. It's unlikely that the US will openly support proliferation, especially Congress, but I find it quite probable that the US may well take a "wink-and-a-nudge" approach to the whole issue. A Section 123 Agreement might be amended to allow reprocessing and a solid-fuelled smallsat launcher sold or authorized, but how was the US government to know that the nation was pursuing nuclear weapons?
Furthermore, the US should start preparing as if an all-out nuclear arms race may resume, because it may well do so. Developing a new comprehensive ballistic missile defense strategy is part of this, possibly including Brilliant Pebbles--I'm a strong advocate of at least researching the solution especially given that so many hurdles already have been met by private companies like SpaceX--but also terminal defenses and directed-energy weapons. The US should also begin thoroughly examining the use of nuclear weapons in a modern context and prepare facilities needed for the production of additional warheads, including possibly a lithium-separation site to manufacture additional tritium, as well as reprocessing sites to produce additional plutonium.
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