National Security

Can the Marines Survive?

If America's amphibious force doesn't adapt, it'll be dead in the water.

On one day in 1965, a large sortie of U.S. Air Force F-105s dropped over 600 750-pound bombs on the Thanh Hoa Bridge, just 70 kilometers south of Hanoi. The result was the loss of five U.S. aircraft and a complete failure to destroy the bridge. Amazingly, the bridge would withstand over 800 more sorties from U.S. aircraft in the next seven years and receive the moniker "The Dragon's Jaw" because of its seeming indestructability and the nearby air defenses that stymied U.S. forces. Finally, in 1972, a sortie of F-4Ds carrying the new Paveway laser-guided bomb destroyed the Thanh Hoa Bridge.

Although not obvious at the time, the advent of the Paveway marked the beginning of a dramatic transformation in U.S. military technology that would change warfare forever. The revolution in precision munitions that began then has so accelerated in recent years that enemy forces can no longer operate in formations and in mass. They simply present too big a target. That, in turn, means that the days of U.S. corps, divisions, and brigades maneuvering on a battlefield with tanks, artillery, and motorized/mechanized infantry are numbered. Our surveillance capabilities allow us to sense everything on the battlefield. Any sizable vehicle formation, or single vehicle for that matter, can be destroyed with the click of a button half a world away. On today's battlefield, movement means death.

A lively debate is taking place within the Pentagon these days over how to adapt to this new reality. The Air Force and the Navy have come up with a new concept called Air-Sea Battle, which focuses on integrating naval and air forces to defeat adversaries with precision weapons backed by robust intelligence, surveillance, and reconnaissance (ISR) assets. Simply put, the Air Force and the Navy are embracing new technology and have come to understand that with an integrated approach they should be able to defeat an enemy that is hundreds, perhaps thousands of miles away.

By contrast, the Marines -- and the Army -- are still trained in infantry tactics that would be recognizable to a World War II vet, organized to fight big land battles with heavy tanks and armored personnel carriers. There's an elephant walking around the Pentagon these days and everyone is trying to ignore it. No one wants to talk about the fact that land forces, as currently organized, are becoming increasingly irrelevant. This is not to say that there is no use for ground troops. They are needed, but in future conflicts they will only play a secondary role. Land forces will no longer win wars. Computers, missiles, planes, and drones will. If the Marines want to survive, we're going to have to adapt -- and fast.

Struggling for Relevance

The Marines are a door-kicking service, designed to breach enemy territory and establish an entry point for the Army's strategic land capability. But the U.S. military's development of unmanned aircraft, combined with stealth technology and unmatched ISR capability, makes it almost impossible for an enemy today to significantly impede the landing of U.S. forces on a beach or at a port. Forcible entry no longer requires landing forces -- it takes precision strikes, coordinated by special operations forces as needed. But if the door is going to be kicked in by a cruise missile, an unmanned aircraft, or other platform delivering precision munitions, why does the Marine Corps insist on maintaining such a large amphibious forcible entry capability based around the same Marine who stormed ashore at Tarawa? Because to argue that the United States does not need a forcible-entry force would be to question the very necessity of having a Marine Corps. Unfortunately, that is the question the Corps must now answer.

The Marines could have pushed for change 10 years ago. Following the 9/11 attacks, then-Secretary of Defense Donald Rumsfeld approached the Marine commandant and asked if the Marines could take on a special operations role within the Department of Defense. For the secretary, it seemed logical. The Marine Corps is designed to operate independently when necessary; it can sustain itself with a well-oiled logistics organization, and it even has its own air wings. At the time, most special operations forces resided in the Army and in Navy Special Warfare and there was an emerging shortage of operators. The Corps could have filled the gap in special forces that existed right after 9/11.

The Marine Corps leadership balked at this proposition. A compromise with Rumsfeld did lead to the creation of Marine Special Operations Command, which now operates under U.S. Special Operations Command, but it was slow to get off the ground and has had trouble establishing credibility within the special operations community. The Marine Corps then focused on fighting the Iraq and Afghanistan wars for the next 10 years. With Iraq over and Afghanistan drawing to a close, planners can now focus again on what the United States will need in a possible unlimited war. But the Marine Corps -- and the Army -- have been caught flat-footed, unable to truly grasp the superiority of U.S. technology and how ground forces must adapt to harness its potential.

So what should the Marine Corps do?

First, it needs to recognize that future wars will be very different. Firepower will be brought to bear by unmanned surveillance aircraft and by small, highly trained teams. These teams will be fast, exceptionally physically fit, able to operate independently, but also able to operate with larger forces when necessary. Teams will be inserted by parachute, landing zone, or over the horizon from the sea. They will be backed up by a robust logistics tail and continuous, round-the-clock air support that provides security to compensate for their small size. Air support will consist of fixed-wing assets at sea, national assets based around the world, and fleets of unmanned aircraft that constantly surveil each team and the area in which they operate. That means teams are unlikely to be surprised or ambushed, and when threats are identified, they can be quickly neutralized by precision munitions launched from drones, manned aircraft, and ships. The teams will be able to conduct precision operations and a variety of raids, or hundreds of operators can be employed in coordination with each other during high-intensity conflicts.

In short, the future of warfare is in special operations, and the Pentagon will need a lot more operators. The future of the Marine Corps is as a special operations force that functions in a sustained combat mode.

Second, the Marine Corps needs to start thinking in terms of what the military calls "jointness" -- the ability to operate with other services. The Department of Defense is now joint through and through, and yet the Marine Corps still prides itself as an expeditionary force, able to deploy with limited external support. That has been a strength of the Marine Corps, but today it may be a liability. One problem is that the Marine Corps does not own most of the precision weapons platforms that are needed to operate on future battlefields. It needs to accept that it will have to rely on its sister services (particularly the Air Force) for ISR and close-air support to ensure the viability of small teams. Yes, there is probably some benefit to having a Marine pilot supporting Marine ground forces, as we were always told at The Basic School. But is a Navy or Air Force pilot really unable to adequately support Marines on the ground? Just maintaining the command, control, communications, computers, combat systems, and intelligence structure that will eventually connect every Marine on the battlefield will require Air Force platforms. The Marine Corps will not be able to maintain the data connectivity needed to manage the future battlefield. Instead of fighting jointness, the Corps should articulate how it can be leveraged to make Marines even more lethal.

Third, the Corps will have to completely change its approaches to doctrine, training, and equipment. Organizing for land battles or amphibious forcible entry is outdated, because U.S. firepower can obliterate any enemy force that dares to occupy the battlespace. Quite simply, there will be nothing for tanks and large troop formations to fight. The future belongs to small teams who will not be supported by air power and precision munitions, but who will actually support air power and precision munitions. The doctrine of close-air support will be reversed, turning into "close-ground support" whereby Marines will be a supporting component in a much larger campaign of missiles and guided munitions.

To operate in small teams that can coordinate a massive precision-engagement campaign, Marines will have to change the way they fight and train. The ethos of "every Marine a rifleman" will shift to "every Marine a JTAC," or joint terminal air controller. A Marine or team that cannot communicate on the battlefield will die. Marines will manage and become experts on dozens of different communications platforms ensuring double and triple redundancy. The battlefield of the future will be wired with data pipes bigger than the Alaskan Pipeline. If commanders today worry about information overload, they haven't seen anything yet. Every warrior on the battlefield will have access to the common operating picture, able to call in dozens of precision strikes from multiple platforms at once. Graduation exercises at infantry school will be based around scenarios that test the ability of the individual and team to operate in austere environments under physically grueling conditions -- while maintaining continuous communications over several waveforms. The Crucible will look like a day at the fair.

Organizationally, the Marine rifle squad as we know it today will no longer exist. Each squad will have a signals intelligence specialist, data and communications specialists, demolitions experts, one or two corpsmen, a sniper, and two or three machine gun teams -- only one or two team members may be certified "JTACs" but all must know how to coordinate the use of precision munitions and air assets via multiple radio and data waveforms. From the lowest-ranking member of the team to the general officer leading the joint task force headquarters, live video feeds will stream continuously, giving every warfighter a clear, concise picture of the battlefield. Rarely will the Marine of the future use his personal weapon; "rifleman" will become an antiquated term.

Elite Again

Leadership organization and manpower management will all have to be addressed if the Marine Corps is to conduct a significant re-organization. Marines operating in small teams will probably require over a year of training, probably more. A normal four-year enlistment might not be cost effective. Force structure may have to be reduced in order to ensure there are enough recruits with the qualifications and physical abilities to make the cut as operatives in the new elite Marine teams. Suffice it to say, the changes will hit every area of the Corps from recruiting to training to organization to equipping. The Marine Corps has been historically infantry-centric; to remain so could mean its eventual irrelevancy.

We will never fight another war in the mud. However, special forces can currently operate only for short periods of time; they cannot operate in a sustained mode in the face of significant opposition. The Marine Corps is in a position to fill the gap that currently exists within the special forces community. The Marine Corps must recognize the change that is sweeping the U.S. military and be the trailblazers we have always been when it comes to innovating and providing the most bang for the nation's buck. Failure to act could mean increasing irrelevance for a force that has been one of the United States's most storied and effective fighting organizations.

Lance Cpl. Michael Petersheim/DVIDS


The Final Frontier

For savvy investors looking to diversify their portfolios, there’s only one place left to go: sub-Saharan Africa.

In popular culture, sub-Saharan Africa may still conjure  images of conflict and poverty, yet investors from Wall Street to Main Street are taking a decidedly rosier view. Africa's surging growth is now well known -- the region is home to six of the 10 fastest-growing economies in the world. "Never in the half-century since it won independence from the colonial powers has Africa been in such good shape," gushed a recent special report in The Economist.

If you had jumped on this bandwagon in 2012, you too would be an Afro-optimist. Investors may be thrilled that the S&P 500 index rose a cheery 13 percent in 2012 and is up another 8 percent this year -- but this pales next to Nigeria's stock market, which spiked 35 percent last year and is up another 18 percent so far this year. Ghana (up 24 percent), Uganda (up 39 percent), and Kenya (up 30 percent) also posted strong showings in 2012, and even longtime economic basket case Zimbabwe is up 20 percent in 2013.

But potentially huge returns are only part of the reason to invest in one of sub-Saharan Africa's budding equity markets. The real play is diversification. As we discovered in our recently released study for the Center for Global Development, African bourses are among the last of a rare and endangered species -- stock markets that remain uncorrelated with the major global exchanges.

Diversification is a basic principle of asset allocation. Few investors want to put all their eggs in one basket, thus risking losing it all in the event of a downturn. By spreading around one's assets in markets that do not move in a synchronized manner, investment risks can be dramatically lessened. However, all this depends on finding markets that move independently from each other.

But an irony of globalization is that as financial markets integrate, they respond to similar events -- and thus the benefits of spreading one's assets across different markets shrinks. These linkages can lead to contagion in times of crisis -- such as Mexico in 1994 or Thailand in 1998 -- when panic in one country can plunge markets into crisis on the other side of the globe.

The old exotic is already the new normal: Traditional emerging markets, like those in Latin America or Asia, are even more strongly correlated with the United States than we expected. The main U.S. and European stock market indices monthly correlation is about 0.9 (with 1 meaning they move in perfect sync), and Latin America is not far behind. The correlation of the S&P 500 with a weighted average of Latin American stock indices reached 0.86 in 2010, up from a meager 0.15 in 1992. That means, when the Dow moves on Tuesday, it's highly likely that markets in Sao Paolo and Beijing will follow suit.

By comparison, Africa's correlation is lagging -- and for once this is gives it an advantage. A weighted index of sub-Saharan markets (excluding South Africa) has a correlation of just 0.31 with the S&P 500, less than half of what we find in Asia or Latin America. Thus, an investor won't be able to diversify his holdings by buying Brazilian or Chinese stocks -- but he would be able to do so by investing in Kenya or Ivory Coast. A savvy investor, who can find quality stocks in these places, won't have to worry much about plunging shares elsewhere hitting these shares.

Furthermore, the lack of correlation among individual African markets provides potentially even greater benefits to a diversification strategy. We found close to zero correlation, for example, between Nigeria and Tanzania or, say, between Ghana and Botswana. That's more good news for smart investors looking to spread their risk by investing in multiple markets.

But the clock for exploiting this anomaly is ticking. As markets integrate, African stock returns are converging with global benchmarks: Their correlation with the S&P 500 was close to zero a decade ago, but has steadily risen. As more investment has moved into Africa, they have become, ironically, more closely in sync with external markets. Fortunately, African markets may not reach total convergence any time soon, but their usefulness as a way to spread around risk is certainly going to continue to diminish. And as African investors start to place their money into neighboring countries, the intra-regional benefits will likely decline as well.

African stocks are not for all investors. Volatility of returns remains relatively high, and liquidity is still shockingly low. Large institutional investors in particular will find it difficult to enter many of these smaller frontier markets, just because of their sheer size. Ghana's exchange, for example, may be posting impressive returns of late -- but the market trades less volume in a whole year than the New York Stock Exchange does by lunchtime. Even finding blocks of shares larger than $5 million can require patience and can exclude some of the biggest players..

But there are a growing number of boutique funds that specialize in the region, which are well placed to manage the challenges. EPFR Global, a fund flow data provider, reports that these funds and others managed by major global banks have already begun pumping money into Africa-dedicated equity funds -- nearly $900 million in December 2012 alone. Just last week, Barclay's South Africa-based Absa Asset Management announced plans for a new $100 million regional stock fund. (If you are a small investor and want to try for yourself, here's's Ryan Hoover's advice for how to start in Botswana.)

African countries can also take steps to better exploit this growing investor interest. The first is, ironically, getting more domestic investors -- it's never a good sign to foreigners when the locals are shying away. In most African countries, the biggest potential investors are their own public pensions, which are often restricted by rules severely limiting stock holding. Relaxing these rules, as Ghana and Nigeria have begun to do, could release a large reservoir of capital and help to build the equity market investor base.

In theory, there's also no reason for countries to each have their own stock market. The economics suggest they should merge into one large regional exchange, sharing costs and boosting overall liquidity. But the political logic runs the other way: stock markets have become important symbols of a modern economy -- the contemporary equivalent of a national airline -- so each country wants to have its own.

As an interim step, markets can encourage cross-listing, which can offer the best of both worlds. This practice is already reaping benefits: The Botswana Stock Exchange, in addition to its 24 local companies, also trades 14 South African-listed shares, which boosts its total market capitalization more than nine times.

The biggest hurdle holding back these markets from further expansion is the limited size of their own host economies. If a country's entire economy is only $20 billion (roughly the gross domestic product of Tanzania or Uganda) or even $35 billion (approximately Ghana or Kenya), then it will likely only have so many private companies large enough to attract big international investment. Even Nigeria, with a GDP of $235 billion and a stock market capitalization of $66 billion, has only seven companies over the $2 billion minimum which qualifies them as a "midcap." But if Nigeria can maintain its high rates of economic growth, this dearth of globally attractive listings won't last for long.

In the meantime, African officials and fund managers seeking to bolster capital inflows should exploit one of the very few advantages of being outside the global economic mainstream by highlighting the independence of its equity markets. In so many ways, the world economy is stacked against small markets and small investors. Here is one way in which the little guys -- at least for now -- can gain an edge.