MCU Journal 
vol. 10, no. 1
Spring 2019
Economics of Defense


From the Editors



The Cost of Being In-between 

War, Peace, and Trade Management

Patrick Callaway




Abstract: The United States found itself in a precarious position in the rst years of the nineteenth century. As a neutral power on the sidelines of an expanding European war, the circumstances provided both opportunity and danger for the new nation. is article argues that Thomas Jefferson’s use of American trade as a negotiating tool in international diplomacy to secure a particular vision of neutral rights during his second administration (1805–9) created a number of domestic consequences. The effects of his international policies had the unexpected outcome of fundamentally questioning the Jeffersonian political economy’s underpinnings of limited federal powers and a government structure supported by customs duties rather than onerous internal taxation. Declining government revenues and increasing domestic opposition led to the end of the embargo, while Jefferson’s international vision of neutral rights remained unfulfilled.


Keywords:  Thomas Jefferson, Embargo Act (1807), Albert Gallatin, Jeffersonian political economy, smuggling, customs



Patrick Callaway is a PhD candidate in history at the University of Maine. His research focuses on the economic connections between the United States and the British Empire in the late eighteenth and early nineteenth centuries. He earned his MA in history from Montana State University in 2008 and his BS in secondary education from the University of Montana-Western in 2005.



How Effective Are Covert Operations?

The CIA's Intervention in Chile, 1964-73

James Lockhart, PhD


Abstract: This article reassesses the effectiveness of the CIA’s interventions in Chilean elections from 1964 to 1973. The author contends that these covert operations were not decisive and were no more than modestly effective. Rather, a pattern of shifting coalitions on the ground in Chile better explains the electoral outcomes that occurred during these years. This suggests that these findings might offer insight into our conversations about Russian intervention in American presidential elections in 2016, thus contributing to ongoing discussions on applied history, politics, and policy making.


Keywords: security and intelligence studies, covert operations, influence campaigns, President Eduardo Frei, President Salvador Allende, Chilean coup of 1973, Augusto Pinochet dictatorship, Latin America, Cold War


James Lockhart, an assistant professor of history at the American University in Dubai, specializes in international affairs, American foreign relations, and intelligence history. His first book, Chile, the CIA and the Cold War: A Transatlantic Perspective (2019), interprets Chile’s Cold War experience within the context of Atlantic history.



Defense Sales and British Security Assistance to Oman, 1975-81

Nikolas Gardner, PhD


Abstract: This article examines the evolving security relationship between Britain and Oman from the final stages of the Dhofar conflict until the early 1980s. This period is significant because it saw the continuation of British military assistance in the absence of a compelling security threat. The article illustrates the tensions that emerged between the two states as the sultan of Oman attempted to increase his control over defense policy, while the British struggled to balance the economic benefits of continued arms sales to Oman with the costs and risks of ongoing military support to an increasingly assertive leader. By resolving these tensions, however, the two states effectively laid the foundation for a relationship that remains strong today.


Keywords: Britain, Oman, Dhofar, security assistance


Nikolas Gardner is associate professor of strategy at the UAE National Defense College in Abu Dhabi. He is the author of Trial by Fire: Command and the British Expeditionary Force in 1914 (2003) and e Siege of Kut-al-Amara: At War in Mesopotamia, 1915–1916 (2014). His current research examines British security assistance to Middle Eastern states during the 1970s. The opinions expressed in this article are those of the author and do not reflect the views of the National Defense College or the United Arab Emirates government. 



(Mis)use of Weapons

CERP in the Afghan Surge

Rebecca Jensen



Abstract: The Commander’s Emergency Response Program (CERP) was initially a mechanism for spending captured Iraqi funds to relieve urgent humanitarian need in the early phase of the Iraq War. It evolved to include American funding and a broader mandate to assist the emerging counterinsurgencies in Iraq and Afghanistan. Empowering frontline military forces to distribute money in an attempt to shape the environment was an innovation, but the absence of best practices and guidelines until much later in the wars, as well as a widespread lack of understanding of the economics of development, continuity, or useful metrics, hampered CERP in achieving its goals. Increased CERP funds were an element of the new strategy for Afghanistan advanced by the Barack H. Obama administration. The flawed premise of the surge, combined with a lack of military expertise in economic aid and Afghan culture, led to an outcome in which billions of dollars, spent with the best of intentions, hampered development and in some cases strengthened the insurgency.


Keywords: counterinsurgency, Commander’s Emergency Response Program, CERP, military change, stabilization, paci cation, development, hearts-and- minds counterinsurgency.



Rebecca Jensen is a Gen Lemuel C. Shepherd Jr. Memorial Dissertation Fellow at Marine Corps University and a doctoral candidate at the University of Calgary in Calgary, Canada. is article is excerpted from a chapter of the author’s forthcoming dissertation.



Cyber's Cost

The Potential Price Tag of a Targeted "Trust Attack" 

Ian T. Brown



Abstract: In 2015, Chinese hackers breached the Office of Personnel Management (OPM) and stole sensitive information on millions of federal employees. This article speculates how the Chinese government might use this information to construct a tailored cyberattack designed to paralyze an American military response to aggression in the South China Sea. This includes an assessment of potential second- and third-order economic impacts of such a cyberattack.


Keywords: cyber, cyberattack, China, South China Sea, trust attack, Office of Personnel Management, hack, OPM



Maj Ian T. Brown is a U.S. Marine Corps Sikorsky CH-53E Super Stallion helicopter pilot. He has previously written about conflict theory and cyberwarfare in the Marine Corps Gazette, War on the Rocks, The Strategy Bridge, and he has discussed it in the Professional Military Education podcast. He recently published A New Conception of War: John Boyd, the U.S. Marines, and Maneuver Warfare with MCU Press; it is a reexamination of the development of maneuver warfare doctrine in the Marine Corps. is article was adapted from an article previously published in May 2018 in War on the Rocks and the material was used with permission, for which the author is grateful to present the adapted material to a broader venue. The opinions expressed here are the author’s alone and do not reflect those of the U.S. Marine Corps, the Department of Defense, or any part of the U.S. government.



The Budget and Acquisition Challenges of Implementing Strong, Secure, Engaged

J. Craig Stone, PhD


Abstract: In June 2017, the Canadian government issued a new defense policy titled Strong, Secure, Engaged: Canada’s Defence Policy. The policy is designed to indicate Canadian defense priorities during a 20-year horizon with increases in both defense spending and the size of the military. Since its release, commentary on the policy has varied across the spectrum, ranging from positive support to very negative criticism. Now more than a year later, the discussion focuses on the status of implementation based on the 20-year program articulated in the policy. This article highlights two speci c aspects of the policy: the budget and acquisition challenges of its implementation. e article reviews the broad con- text and intentions of the policy, reviews the budget challenges followed by the acquisition challenges associated with implementing the policy, and concludes by arguing that it is much too early in a 20-year implementation time line to be negative about the future prospects.

Keywords: defense budgeting, defense acquisition, procurement, defense policy, Canada


J. Craig Stone is a retired Royal Canadian Army officer with a PhD in war studies (defense economics) and has been at Canadian Forces College, Toronto, Ontario, in uniform and as an academic since 1997. He retired from active duty in 2005 and served as the director of academics from 2009 to 2015. He is currently the deputy chair of the Department of Command, Leadership and Management. The views expressed here are those of the author and do not reflect the Department of National Defence or government of Canada policy.


Relationship Repair Strategies for the Military Professional
The Impact of Cultural Differences on Expectations and Applications

Lauren Mackenzie, PhD, and Kristin Post



Abstract: Decades of scholarship and various academic disciplines have underscored the importance of effective intercultural collaboration for the military professional. Although the skills devoted to relationship building have remained a prominent component of the professional military education and training toolkit, far less attention has been paid to the process of mending relationships, or relationship repair strategies, and the political or diplomatic cost to the Services should they fail. is article addresses cultural variation in relationship repair by reviewing the academic literature and analyzing themes surrounding effective restorative actions in military contexts, particularly advise and assist missions. The article concludes with considerations for training and education applications.


Keywords: relationship repair, culture, military training and education, apology, self-construal


Lauren Mackenzie is professor of military cross-cultural competence and Kristin Post is a contracted researcher in the Translational Research Group at Marine Corps University’s Center for Advanced Operational Culture Learning. The views expressed here are their own and do not necessarily reflect those of the U.S. Marine Corps, the Department of Defense, any governmental agency, or Davis Defense Group.








Marine Corps University