Tensions between North Korea and the US continue to roil the volatility markets, although the overall stock market ended the week only slightly negative. The problem is, unlike past pivotal moments such as Brexit, the 2017 French election, and the 2016 US presidential election, there is no deadline for when North Korea will act. This means there will be a cloud of uncertainty until the problem is resolved, assuming it ever is. Some of the possible scenarios are listed below, from best to worst:
1. Nothing happens. No missiles are fired.
2. A single missile is fired, like many times before, away from Guam
3. Four missiles are fired 40 km from Guam, as promised
4. If #3, whether intentional or not, missiles hit civilian or military targets
5. If #3 or #4, Trump retaliates by launching airstrikes on North Korea
6. If #5, North Korea responds by attacking South Korea. The US responds by launching a massive offensive against North Korea, ending the Kim dynasty.
This should have been done in the 90′s or early 2000′s, before North Korea had the opportunity to build up its nuclear arsenal. The best way to prevent a problem from becoming big is to stop it when it’s small. Everyone (including famously Bill Clinton) just assumed by ignoring or placating Kim Jong-il, it would go away. If a country that is openly hostile to the US and its allies is building weapons, what possible function could those weapons serve. North Korea and China have always been allies (or at least neutral), and south Korea and Japan and completely pacifist, so it’s not like North Korea was in any danger of being attacked. IMHO, this is where interventionism, to some extent, is correct. The Iraq way was a mistake, not because there were no WMDs, but because of the nation building process, which took too long and was a waste of money. Even the small possibility of a hostile country developing nuclear weapons should not be taken lightly. It’s a difficult situation. There is a balance between respecting the sovereignty of nations, yet invoking a consequentialist argument, ensuring that a single nation does not inflict disproportionate harm to others, if such harm cam be prevented at a reasonable cost. Isolationists may argue that America does not have the authority to impose its values on other countries. But what if war is necessary to protect economic interests. For example, if countries ‘A’ and ‘B’ are trade partners, but B is attacked by rogue nation ‘C’. Should A intervene to defend B? Isolationists would argue ‘no’, but what is the economy of A suffers as a result of trade being disrupted, and also C starts attacking other nations too.