Fallout from Invasion of Ukraine
The long term impact of Russia’s invasion of Ukraine is still unknown, as is the ultimate endstate. Today (2/25/22) it seems likely that Russia will seek to turn Ukraine into a rump state, with the majority of its territory controlled directly or indirectly by Russia. Similar interventions of other former Soviet republics also seem possible. While I won’t speculate on the effectiveness or duration of the economic and political costs that the US and its allies will impose on Russia, this jarring event will scramble trendlines in national security. At Fairwater Labs, we’ll be watching closely for hints at what steps the US and allied military should take in light of the new reality. We are proud of the tools our portfolio companies are building that are relevant to not only present, but future national security needs. The US and its allies are likely to be tested in new ways going forward. Here are a few possibilities:
-End of the Nuclear Nonproliferation Era
Ukraine voluntarily gave up nuclear weapons under its control in the mid-90’s on the basis of security guarantees from the US, UK, and… Russia. Meanwhile, Pakistan, India, and North Korea have all become nuclear states in the past 30 years with few long-term direct consequences. Countries, particularly those without firm treaty alliances, may begin to rethink the calculus of refraining from developing indigenous nuclear capabilities. Iran is of course already well on its way, but we may see more interest from countries in the Asia Pacific region concerned about Chinese claims on their territory. Taiwan and Vietnam stand out in particular, and it remains to be seen how secure South Korea and Japan in their security alliances with the US. When paired with the effects of the voluntary nuclear weapon renunciation- and subsequent Western intervention- in Libya, the invasion of Ukraine may send a signal that nuclear weapons are an indispensable way to avoid intervention from nuclear powers. The US and its allies will have to decide how to respond to these attempts, and whether or not to extend iron-clad nuclear agreements farther afield.
-Primacy of the Information and Cyber Environments
Western countries and Ukraine painted a very different picture of the situation than Russian media. Russian citizens were mainly shielded from the open source information that undermined Russian claims of Ukrainian genocide. Chinese citizens are likewise restricted in the information they are receiving about the situation. RT, Russia’s state controlled English language media outlet, was taken down by Anonymous, and numerous Ukrainian websites were shut down by Russian-based hackers. If Russia succeeds in taking over Ukraine’s media and internet infrastructure, they will likely institute similar freedom of speech/information curbs to those that exist in Russia. Western countries and media outlets will look for both open and surreptitious ways to expand access to outside information sources for residents of closed countries. Both Western and authoritarian regimes will use this situation as an opportunity to take stock of their strategies and plans. We will likely see major investments in protecting web and media infrastructure in Europe and the US from cyber attacks and disruption.
-Web3 and the Weaponization of Finance
According to the WSJ, Ukrainians have already raised millions in cryptocurrency for Ukrainian nonprofits. Ukrainian civilians are converting their currency holdings into stablecoins tethered to the US Dollar. While the sanctions regime of Russia is still coming into focus, Russian citizens and Russian banks may seek to conduct more transactions with cryptocurrencies to blunt the effect of economic sanctions. If Ukraine is occupied, private individuals and organizations may use cryptocurrencies to fund resistance efforts even if Western governments refrain from doing so. Cryptocurrencies may help avoid the logistical challenges of introducing cash and avoid easily traceable bank transactions.
-Open Source Intelligence
US Intelligence agencies and others were able to predict with relative accuracy Russia’s plans to invade Ukraine. Russia countered with a series of misdirections and minor steps (like recognizing the breakaway republics) that seemed to potentially be the final step that they would take. The proliferation of private / non-governmental satellite imagery is making previously high-end capabilities open source. Misdirection, deception, physical camouflage, and digital camouflage will likely assume greater importance in the coming years. These tools have always been important in warfare, but were used less frequently in the age of Forward Operating Bases and massive logistical hubs used in the wars in Afghanistan and Iraq. The US military should look for tools that allow dispersal of troops. One of the main reasons that troops congregate is for logistical resupply- autonomous ground and aerial resupply may be useful tools to reduce vulnerability to detection by satellites and indirect fires, like artillery and airstrikes.
-Gray Zone Warfare
An unanswered question in this conflict is whether this should be seen as a culmination or failure of Russia’s gray zone strategy in its near abroad. Deniability, cutouts, obscured logistics, and many other tools have characterized recent Russian, Iranian, and Chinese efforts to achieve their geopolitical objectives. Western countries of course have used similar tactics, with covert operations and “plausible deniability” being major tools throughout the Cold War and beyond. Covert tools that allow countries to achieve their objectives while being able to deny their origins will likely return to the forefront in national security. In the case of Ukraine, where almost all countries have ruled out direct military involvement, Western countries will search for other means to meet their objectives. In particular, if Ukraine is occupied, we may see Western countries look for deniable ways to support resistance organizations. Attritable, one-time use aerial or sea drones may be used to deliver supplies. In more extreme examples, 3D printers that could make weapons could replace direct arms shipments.
-High end warfare isn’t over
The US and its allies’ relatively easy victory over the Taliban in 2002 and Saddam Hussein’s army in 2003 contrasted with nearly a decade of very deadly irregular warfare in both Iraq and Afghanistan that seemed to point to a future where conventional warfare was relegated to the past. While this conflict is of course still ongoing, it seems clear that Russia is using- and losing- significant numbers of tanks, helicopters and other expensive systems against Ukrainian forces. Insights from this conflict may lead to a reinvestment in these high-end systems at the expense of less protected tools. It may also add urgency to the military’s push for manned-unmanned teaming in ground and aerial systems.