Riskgaming

Redlines for diplomacy and business with former USSOCOM commander Tony “T2” Thomas

Description

“Redlines” in war are meant to be objective and unambiguous tests for a country to respond to another nation’s action. If one country uses chemical weapons in a conflict, that might violate the redline of another country and therefore force it to conduct military operations in response to reenforce the international laws and norms against the use of such weapons. Redlines though are often ambiguous, used poorly, and their deterrence effect is often diminished by a lack of credibility. How should leaders — from politicians to entrepreneurs — think about redlines? To answer that, host Danny Crichton was joined by Josh Wolfe and General Tony “T2” Thomas, the 11th Commander of U.S. Special Operations Command (USSOCOM) and venture partner at Lux Capital, to talk all things redlines from a hotel lobby in sunny Miami.

Transcript

This is a human-generated transcript, however, it has not been verified for accuracy.

Chris Gates:
Okay, here you go sir. Just clip this on.

Danny Crichton:
All right. Do you want to call it in? We're just going to go. I'll redo the intro later.

Chris Gates:
Yep. Ready? 3, 2, 1.

Danny Crichton:
Hello and welcome to Securities by Lux Capital, a podcast and newsletter devoted to science, technology, finance, and the human condition. I'm your host, Danny Creighton. Today we have a special foreign dispatch from the war and Virons of Miami where the Lux crew was holed up the past week. While there, news broke that Russia may have used chemical weapons in its war with Ukraine bringing up echoes of the war in Syria, which led us to a discussion of red lines and their purpose in war, diplomacy, and business. To talk more about this, I was joined in a somewhat cacophonous hotel lobby by Josh Wolf and General Tony Thomas or T2 as he is known. Before joining Lux as a venture partner was the 11th commander of US Special Operations Command, US SoCom, headquartered at McDill Air Force Base Florida. Let's start with you Josh. What are your thoughts on red lines and are they effective?

Josh Wolfe:
Well, let's take the general philosophical purpose of red lines, which is to convey to an opponent that if you do something, I'm telling you a priority that there will be a consequence. You cross that red line, something will happen. You are an animal, you cross the fence, you get zapped. You are an antagonist. You do something that we, a priority tell you is off limits. There will be a consequence, and so it's the predictability of both our own intention and a capability that is the signal that serves as deterrent. What's interesting is in 2013 with Syria, there's two things that people under appreciate. People say Obama said if Assad uses chemical weapons, he's crossing a red line and there will be military action, and then we failed to have military action, so people say that was a policy failure. And without getting any politics or support or conned against Obama, whoever actually orchestrated those weeks, I actually think was a genius because the effect was chemical weapons were removed from Syria.

Okay, but how did it happen? Obama said beforehand, if Assad uses chemical weapons, there will be military action. There wasn't military action. What ended up happening was two things. He said, I think it was in the Rose Garden White House. He comes out, gives a speech. Part one, we intend to use military action, but there was an important coupling, part two, which was, and I will seek congressional authorization. In that second piece of seeking congressional authorization, he gave the space for something else to arise. Now whether they knew that something else was going to arise or created the space for it, Russia ends up coming in and here's this great irony. Russia comes in and says, we will help negotiate the removal of 1300 or 1400 tons of chemical weapons. The takeaway from that is it was actually a success even though we didn't actually go into a direct military incursion, but T2 will comment on that in a second, but maybe those chemical weapons are the very chemical weapons that Russia disarms Syria and may be using now.

Danny Crichton:
T2, you've been involved many of the major historical events around red lines the past few decades. What's their utility?

Tony “T2” Thomas:
Before we talk about the utility of red lines, I think it's important to zoom up a little bit to the macro concept of deterrence because I would offer red lines are a tactical implementation of deterrence, a step, a procedure. Again, to zoom up at the level of deterrence and very ineloquently, I see deterrence as the capability to open a big can of whoop ass and the intent to do so if provoked the application of the military being policy by another means an extension of policy when policy has failed and you make me open a big can of whoop ass. Dialing down a little bit to the level of red lines, I think there's utility in terms of specificity. This is a no penetration line. You go past this, to Josh's point off priority, to do something here, but it has to have a corresponding ability to do something and of course the intent to do so.

In the Syrian chemical weapons case, while a red line was stated and very emphatically stated as opposed to I would offer Ukraine right now where it was discussed, it was bandied about most of us from a military profession thought that might be a trigger, that might be a threshold that would cause us to do something. One, we have not discerned whether or not chemical weapons were actually used in this case. I know that the intelligence community is pouring over it, but I'm not sure that that we'd had the emphatic declaration of this is a red line, we will do something, don't blink. There's value in that, but you have to be ready to execute on your trigger. If you're not, it's a bluff and you do have compounding effects of you whiffed on that one, might you whiff again, are you going to call wolf? And then folks will continue to call you on it until they get to that unfortunate event where you've been provoked sufficiently to do something.

Danny Crichton:
Okay, so we have these triggers and thresholds, but I think one of the enduring complexities of red lines is they're often very hard to actually calculate in reality. You have a strict rule, no chemical warfare, but often we have a fog of war that prevents us from clearly identifying whether they were used and therefore the red line is hard to calculate or switching over to venture capital. We have a red line of say we won't do a C check for less than 5% ownership, but then we have a deal in front of us that's, say, 4.9% ownership and are we really going to say no just because of that last 10th of a percent? So are red lines useful when they are often are so ambiguous and open for interpretation?

Josh Wolfe:
Well, I'll let T2 talk to the fog of war, but to the fog of portfolio construction, as you were alluding to by analogy, there are guidelines and there are principles and there are red lines. Now, we do take certain red lines actually when we do things, so for example, we are very strict about offering an expiring term sheet and we do that because either we're saying it's okay, we trust you, here are the terms, you can go shop the deal if you'd like, or in other situations there might be a really competitive dynamic and we say this is good until Friday at this particular time and we're very clear. The second you say, yes, we are wiring the money, Luxe is all in. However, that deadline comes, we're going to step away. And we do that, to T2's point, the predictability of our behavior and the reputation of that. We want people to know, oh yeah, Luxe actually gave the expiring term sheet and they actually walked away.

It's very important because otherwise everybody's like, oh, nobody actually believes in that kind of stuff. And so I think the predictability and the reputational credibility is important to what T2 was saying before. There was a study in a book and it's called Calculating Credibility by Daryl Press, and he actually finds that "the evidence in this book suggests that the blood and wealth spent to maintain a country's record for keeping commitments are wasted. When push comes to shove, credibility is assessed on the basis of the current interests at stake in the balance of power, not on the basis of past sacrifices. Leaders understand that no two crises are sufficiently alike to be confident that past actions are a reliable guide to the future." He's making an argument that the current thing is the thing that matters. Not to invoke Mark, but the current thing, not in a politically controversial way, but moreso than will your future credibility be on the line here is dealing with the current thing.

Danny Crichton:
I love that Mark Andreessen's current thing, Twitter meme, which I guess you could say is his current thing is seeping into our minds, but T2, talking earlier about deterrence, how does ambiguity play a role in that?

Tony “T2” Thomas:
You're actually compelling me to think of the advantage of not using red lines, the advantage of being abstract, of being ambiguous where again you have the capability, that's undoubted, undeniable. The part that is intangible and maybe indiscernible is do you have the will to use that capability? And so I would offer, you say the Obama administration, if there was any phenomenon during the Trump administration that was consistent, it was how unpredictable he was. As I dealt with foreign counterparts, both friends and foes, no idea what his intent was, what he might tweet that night, what might come out the other end of the barrel, but that ambiguity was actually an advantage other than we didn't take advantage of. We didn't leverage it, so while they were intimidated, if you will, by the potential possibilities that might come out of the valid decision maker, we didn't follow through to leverage it to put the world into a better place. It just was almost utterly random and ambiguous. Red lines I think could be useful, but I can think more often than not where you've played your cards, you have no hold cards at that point you're committed and it's literally liar's dice, poker, whatever analogy you want to use [inaudible 00:08:00].

Josh Wolfe:
This is the classic game theory of playing chicken and two drivers are going at each other and the most rational strategy is to immediately and visibly take your wheel, detach it and throw it out the window so that the other person knows you have no option. You have crossed your own red line, you have committed to a course of action. There's no turning back. The other person either has to commit to die or veer. I do think that this is timeless game theory. It applies to pretty much every situation from business to geopolitics. Just the consequences of the latter are way more significant.

Tony “T2” Thomas:
And redline as a connotation, sounds really compelling. No, you can't avoid it, but I mean when you think of the current construct, the NATO treaty that we and others are signed to. The debate now, will Finland join, will that be another 800 miles of Russian border that we will have to defend going forward? It'll let the debate flow, but the construct of NATO treaty very emphatically states an attack on one crosses an Article Five red line. That doesn't say red line, I'm using a different terminology, but crosses a threshold that the attack on one goes to the defense of all. Now, I would tell you that is there universal adherence or compliance with that? Stay tuned. I don't think so, but that's codified in writing less a red line war... There's a treaty statement with very specific criteria and we'll see what happens.

There was a classic, this is Pompeo's litmus test at the Sedona conference. I was invited out there right before McCain died, Pompeo had been nominated to be the Secretary of State. All the heavies were there. It was literally we're going to watch him put sentences together and coming out. I didn't realize that until somebody told me on the side, this is his litmus test. And someone asked him a question, he was on a panel and they said, "Does America pursue its national interest or national values?"

I thought, Ooh, Mr. Number one in the class West Point, I would've difficulty wrestling with this, and he thought about it for a moment and said, "Uniquely, United States pursues both. We have real politic, we have existential national interest, no vital national interest, things that deal with survival but uniquely oppose the rest of the world, which is the gray area that gets us into trouble. We have national values and as we try to transmit national values to other places and other situations, that's when it gets very gray." What are your objectives here? Somalia, feed the starving people of Somalia. We didn't go there to colonize it. We went there to go feed it. Dumb, maybe? Naive, maybe? But altruistic as hell and nobody else would do it at the time. Our country over the existence of our country has gone to war for both existential reasons and fluffy values related, human rights related reasons and everything in between.

Danny Crichton:
What I think is interesting is that Article Five is prescribing both a functional red line, an attack on one NATO country is an attack on all, while also demonstrating a sort of optimistic defensive democracy that we are going to collectively work together for our self-defense.

Josh Wolfe:
The values piece is important because it is a form of currency or it is a form of power or projection because if those values are communicated externally, there is a clear expectation of what do we stand for and if somebody violates a value, then they should anticipate that there's some repercussion. Whether you're a child in a classroom, they're are values. Whether you're a member of a family, there are values. Whether you're an employee at a company, you're part of a culture, there are certain normative values. Now, when those get codified into laws, whether that's in a city, you know, can't park here, can't commit the crime, can't stab somebody, can't steal, or in international law, can't use chemical weapons, can't use nuclear weapons, can't commit human atrocities, those things start with values. I mean, even our chemical weapons and conventions in Geneva conventions start with values, values about the preservation of human life, about the sanctity, about not committing immoral acts.

Tony “T2” Thomas:
Although even as a soldier, I find that one of the most abstract because we are literally trying to codify man on man combat, the law of armed conflict and trying to regulate it to a degree where when might you use atomic weapons, chemical weapons, weapons of mass destruction when you pull up again, pull back. War is a terrible thing, you need to be committed to actually going full bore. But we've tried to say, well, not this kind of application and we've come to some consensus other than the North Korea's of the world and other who said, "No, I'm not going to sign that thing."

Josh Wolfe:
Well, that's interesting too, by the way, the line, it is a red line between a civilian and a soldier and sometimes that's just a piece of cloth.

Danny Crichton:
A single piece of cloth, the difference between life and death. If that's not a red line, I don't know what is, but thanks so much for the two of you for joining us. When I think about this conversation in Miami between T2, Josh and myself, I'm thinking about the complexities of securities in the 21st century. Science, technology, finance. They're always changing and we start with values and we start with guidelines, principles, red lines, all these rules, all this infrastructure, all this planning to be able to determine our actions in the future as new scenarios arise, and yet with so much change, we're constantly confronted with having to violate what we've predetermined. We start with values as a startup founder, but then as we've seen with companies like Fast, those values seem to walk out the door instantly as soon as money or success or revenues have to happen in order for the company to succeed.

When we see red lines and foreign affairs, they start as red lines. They start as clear guidelines to ensure that everyone in the world understands where the United States or Russia or where France sits and then reality strikes and suddenly those red lines become a lot more blurry. They become almost rose colored. That means for anyone looking to be a leader in the 21st century, it behooves us to back away from our society, from our organizations, from these institutions and really ask personally, how are we going to confront tragedy and decision making going forward? I'm reminded of William Dershowitz's lecture given at the United United States Military Academy in October 2009 called Solitude and Leadership about the importance of stepping back, of assessing our own values, of building a core moral framework and our own red lines, basically to confront all the decisions that are going to come.

Because if there's one thing that's true with complexity in the 21st century, it is that we are constantly having to make decisions, oftentimes in rapid speed, and that doesn't mean we always have an opportunity to think about our values in the context of a recruiting offer or someone doing a particular action on a product or a particular scenario with military action. Instead, if we have built those values embedded right into our very personalities, those decisions become a lot more natural, a lot easier, and we end up following our values and also signaling strongly to others what our intentions are going to be. So step back, think, and create your own red lines as you move forward.

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