The Arctic Is Now: Economic and National Security in the Last Frontier
Traditionally, national security is conceptualized as hard and soft power or military might and diplomatic influence. Economic strength, however, is the foundation of power. Adm. Mike Mullen, former chairman of the Joint Chiefs of Staff, proclaimed that debt poses the biggest threat to U.S. national security.1 Although his warning hardly raised an eyebrow, the economic engines that are China and Germany—and their corresponding global strength—are evidence of the interdependence of economic and national security.
For the United States, greater economic security can be supplied by the untapped resources of the Arctic, where this nation has been dealt an exceptional, yet underutilized, hand. The U.S. share of the Alaskan Arctic holds an estimated 30 billion barrels of oil and more than 220 trillion cubic feet of natural gas, as well as rare earth minerals and massive renewable wind, tidal, and geothermal sources of energy. Unprecedented climate changes have increased access to the region and transformed it into an emerging commercial sector. In total, the economic potential amounts to trillions of dollars. In this period of financial stagnation, developing these energy sources would be a tremendous boost to the United States.
The race for resources is on, although the United States remains at the starting gate. Joining Arctic neighbors in the exploration for and extraction of oil, gas, and rare earth minerals in the U.S. portion could provide an economic boon to the flailing economy of the United States. In 2008, the U.S. Geological Survey (USGS) stated that ‘‘The extensive Arctic continental shelves may constitute the geographically largest unexplored prospective area for petroleum remaining on earth.’’11 In the report, the USGS estimates that 90 billion barrels of oil, nearly 1,700 trillion cubic feet of natural gas, and 44 billion barrels of natural gas liquids may remain to be discovered throughout the region. Nearly all (84 percent) of the oil and gas is expected to be found offshore. The USGS estimate for total undiscovered oil and gas in the Arctic exceeds the total discovered amount of Arctic oil and oil-equivalent natural gas.12
Russia is in the lead for Arctic oil exploration in its region, with its neighbors not far behind. Last year, Russia announced plans for two oil giants to begin drilling as early as 2015.15 The Russian firm Gazprom is developing the Shtokman field in the Barents Sea, home to one of the world’s largest natural gas deposits. Russia has active oil and gas fields off western Siberia and is shipping oil from an offshore terminal in the Pechora Sea to Murmansk.16 Greenland is embarking on offshore drilling near Disko Island off its west coast.17 Norway has developed the Snoh- vit gas field in the Barents Sea near the Hammerfest and is shipping its output of liquefied natural gas to Europe and North America.18 In 2008, Canada received C$1.2 billion ($1.8 billion) from British Petroleum for rights to explore three parcels in Canada’s Beaufort Sea, north of the Arctic Circle.19 The world is one step closer to the Arctic economy. Rare earth minerals are also embedded in the Arctic. Red Dog Mine, the largest zinc mine in the world, is located in northwest Alaska and is quite profitable despite operating only 99 days a year.20 Across the Arctic in Siberia, is the Norilsk Nickel mining com- plex, which leads the world in nickel and palladium production, and is not far behind with copper.21 Rich iron ore deposits run through Canada in the Baffin Basin.22
Not all Arctic resources are buried in the continental shelf. In the United States, fisheries and the seafood industry account for $30 billion domesti- cally, $12 billion in exports, and employ more than 100,000.38 In the southern Arctic region (Bering Sea and Gulf of Alaska), they are leading employers and sustain the indigenous people.39 World-class fisheries are found in the Barents and Bering seas, the Central North Atlantic off Greenland and Iceland, and the Newfoundland and Labrador seas off the coast of northeastern Canada.40 Regulating and monitoring these stocks in the Arctic are critical economically and strategically. If not protected, the fisheries would be decimated by overfishing. The 110th Congress stated that ‘‘the United States should initiate international discussions and take necessary steps with other Arctic nations to negotiate an agreement or agreements for managing migratory, trans-boundary, and straddling fish stocks in the Arctic Ocean and establishing a new international fisheries management organization or organizations for the region.’’41
The United States remains in a holding pattern. The North Pacific Fishery Management Council voted to close the Arctic to commercial fishing until it can be conducted sustainably, a management mechanism is developed, and we can implement an ecosystem-based management policy for Arctic resources.42 At some point, the United States cannot maintain this policy unilaterally and must enforce an international regime through patrolling and monitor- ing foreign fishing and fish-processing vessels in the region.
The Arctic nations are preparing submissions for the extended shelves; Russia’s is currently under review. Under the terms of the convention, the American zone would be the largest in the world— more than 3.3 million square miles, an area greater than the lower 48 states combined.74 In addition to protection of shelf claims, the convention is good for the United States because it sets pollution standards and requires signatories to protect the marine environment. The United States has not submitted a claim because it has not ratified the Convention.75
Ratification is also important for U.S. long-term presence in the region. In the absence of shared law, countries often make unreasonable and irres- ponsible claims in the maritime environment—the Arctic will be no different.76 Without binding law, the United States gambles on long-term credibility to enforce international law, freely navigate the oceans, and protect the business ventures that rely on uniform laws.
Support for ratification has been consistently bipartisan. Proponents include the current president, as well as his predecessors, presidents Bush and Clinton; the current and former secretaries of state, including Condoleezza Rice, Colin Powell, and Madeleine Albright; the current and former chairmen of the Joint Chiefs of Staff; the current and former commandants of the Coast Guard; major environmental groups, and many others. A relatively small number of senators have held the treaty hostage.78 Buoyed by ideological opposition to the United Nations, a small minority of opponents have stopped it from coming to a vote, even though it will advance U.S. interests in the Arctic and around the world. These senators argue that the United States does not need to be party to a treaty to enforce the rule of law. This rationale resonates with many Americans and is popular with the Tea Party but, in this case, to the great detriment of national security.
The United States stands atop a precipice, faced with a momentous opportunity to take advantage of trillions of dollars in natural resources, while sim- ultaneously restoring the nation’s economic security through governance and job creation. Governance is the first step. Ratifying the Law of the Sea Conven- tion must be a priority for the administration or the United States will lose economically and could be challenged as the global maritime leader. The Inter- national Maritime Organization will remain the key vehicle for governance mechanisms. AIS expansion, as well as mandated Arctic shipping guidelines and establishing traffic patterns should be top priorities for the United States. Governance needs to be accompanied by a significant acquisition program to keep pace with the other Arctic nations. Ice- breakers, additional aircraft, and infrastructure can no longer be shoehorned into a Coast Guard budget, which has inadequate funding even for recapitaliza- tion of its Vietnam-era fleet.
The United States needs an Arctic economic development strategy that incorporates the departments of Defense, Homeland Security, Commerce, and Energy. Such strategy should include plans for shore-based infrastructure, communications, and surveillance technology, icebreakers, and response aircraft for the region. In an era of declining budgets, the simplest course of action would be to ignore the tremendous potential of investment in the Arctic. However, such willful turning away reduces our ability to reap tremendous economic benefits and could harm U.S. national security interests.