Does Conquest Pay?: The Exploitation of Occupied Industrial Societies

By Peter Liberman

Can foreign invaders successfully exploit industrial economies? Since control over economic resources is a key source of power, the answer affects the likelihood of aggression and how strenuously states should counter it. The resurgence of nationalism has led many policymakers and scholars to doubt that conquest still pays. But, until now, the "cumulativity" of industrial resources has never been subjected to systematic analysis.



Does Conquest Pay? demonstrates that expansion can, in fact, provide rewards to aggressor nations. Peter Liberman argues that invaders can exploit industrial societies for short periods of time and can maintain control and economic performance over the long term. This is because modern societies are uniquely vulnerable to coercion and repression. Hence, by wielding a gun in one hand and offering food with the other, determined conquerors can compel collaboration and suppress resistance. Liberman's argument is supported by several historical case studies: Germany's capture of Belgium and Luxembourg during World War I and of nearly all of Europe during World War II; France's seizure of the Ruhr in 1923-24; the Japanese Empire during 1910-45; and Soviet hegemony over Eastern Europe in 1945-89.



Does Conquest Pay? suggests that the international system is more war-prone than many optimists claim. Liberman's findings also contribute to debates about the stability of empires and other authoritarian regimes, the effectiveness of national resistance strategies, and the sources of rebellious collective action.

• Language: English
• Publisher: Princeton University Press
• Release date: Aug 3, 1998
• ISBN: 9781400821747

Peter Liberman

Peter Liberman is Associate Professor of Political Science, Queens College, City University of New York.

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DOES CONQUEST PAY?

Princeton Studies in International History and Politics

SERIES EDITORS

John Lewis Gaddis

Jack L. Snyder

Richard H. Ullman

History and Strategy by Marc Trachtenberg (1991)

George F. Kennan and the Making of American Foreign Policy, 1947-1950 by Wilson D. Miscamble, c.s.c (1992)

Economic Discrimination and Political Exchange: World Political Economy in the 1930s and 1980s by Kenneth A. Oye (1992)

Whirlpool: U.S. Foreign Policy Toward Latin America and the Caribbean by Robert A. Pastor (1992)

Germany Divided: From the Wall to Reunification by A. James McAdams (1993)

A Certain Idea of France: French Security Policy and the Gaulist Legacy by Philip H. Gordon (1993)

The Limits of Safety: Organizations, Accidents, and Nuclear Weapons by Scott D. Sagan (1993)

Mercenaries, Pirates, and Sovereigns: State-Building and Extraterritorial Violence in Early Modern Europe by Janice E. Thomson (1994)

We All Lost the Cold War by Richard Ned Lebow and Janice Gross Stein (1994)

Who Adjusts? Domestic Sources of Foreign Economic Policy during the Interwar Years by Beth A. Simmons (1994)

America's Mission: The United States and the Worldwide Struggle for Democracy in the Twentieth Century by Tony Smith (1994)

The Sovereign State and Its Competitors: An Analysis of Systems Change by Hendrik Spruyt (1994)

Cooperation among Democracies: The European Influence on U.S. Foreign Policy by Thomas Risse-Kappen (1995)

The Korean War: An International History by William Stueck (1995)

Cultural Realism: Strategic Culture and Grand Strategy in Chinese History by Alastair Iain Johnston (1995)

Does Conquest Pay? The Exploitation of Occupied Industrial Societies by Peter Liberman (1996)

DOES CONQUEST PAY?

THE EXPLOITATION OF OCCUPIED

INDUSTRIAL SOCIETIES

Peter Liberman

PRINCETON UNIVERSITY PRESS PRINCETON, NEW JERSEY

Copyright © 1996 by Princeton University Press

Published by Princeton University Press, 41 William Street,

Princeton, New Jersey 08540

In the United Kingdom: Princeton University Press,

Chichester, West Sussex

All Rights Reserved

Liberman, Peter, 1962-

Does conquest pay? : the exploitation of occupied industrial societies / Peter Liberman.

p. cm. — (Princeton studies in international history and politics)

Includes bibliographical references and index. ISBN 978-0-691-00242-2

1. Military occupation—Economic aspects.

2. Military occupation—Economic aspects—Case studies.

I. Title. II. Series.

JX5003.L53 1995

325'32'0904—dc20 95-17925 CIP

eISBN: 978-1-400-82174-7

R0

Contents

List of Figures and Tables vii

Preface and Acknowledgments ix

Chapter 1. Does Conquest Pay? 3

Chapter 2. When Does Conquest Pay? 18

Chapter 3. Nazi-Occupied Western Europe, 1940-1944 36

Chapter 4. Belgium and Luxembourg, 1914-1918 69

Chapter 5. The Ruhr-Rhineland, 1923-1924 87

Chapter 6. The Japanese Empire, 1910-1945 99

Chapter 7. The Soviet Empire, 1945-1989 120

Chapter 8. The Spoils of Conquest 146

Notes 159

Works Cited 209

Index 243

Figures and Tables

FIGURES

5-1. Industrial Output, Coal Output, and Reparations-Coal Deliveries of the Ruhr-Rhineland, January 1923-February 1924

6-1. Per Capita Gross Domestic Expenditure in the Japanese Empire, 1910-1938

7-1. Reparations from East German Production, 1945-1960

7-2. East German Reparations, Percentage of Current and 1936 GNP

TABLES

1-1. Conquerors’ Costs and Benefits

1-2-. Development Level of the United States in 1980 and Case-Study Countries

2-1. Hypotheses on Resistance and Productivity

2-2. World War II Mobilization of the United States, Britain, Germany, and Italy

3-1. West and Central European Population and Industrial Output, 1938

3-2. Occupation Costs and Credits, through March 1944

3-3. Mobilization of Western Europe for the Nazi War Economy

3-4. Foreign Workers in Germany, Fall 1943

3-5. German Administrative Personnel in Occupied Territories

3-6. Average Monthly Financial Transfers, July 1940-March 1944

3-7. Real National Income (Percentage of 1938) and Average Extraction Rates, 1940-1944

3-8. European Modernization Levels and Per Capita Contributions to the German War Economy

4-1. Population and Industrial Output of Germany, Belgium, and Luxembourg, 1913

4-2. Industrial Output of Belgium, 1913-1918

4-3. Industrial Output of Luxembourg, 1913-1918

4-4. Belgians Working Directly for Germany in January 1918

5-1. Ruhr Occupation Balance Sheet, January 1923-August 1924

6-1. Coal, Aluminum, Iron, and Steel Production in Korea, Taiwan, and Manchukuo, 1937-1944

6-2. Development Indicators for Japanese Empire, 1938, and South Vietnam and Algeria, 1958

7-1. Soviet Exactions and Aid, Eastern Europe, 1945-1960

7-2. Contributions to the Warsaw Pact by Northern Tier Countries

7-3. Soviet Forces in Eastern Europe, 1978

7-4. Development Levels, Selected Soviet Bloc and Western Countries, 1938 and 1980

7-5. Unrest in Eastern Europe, 1945-1988

8-1. Conquerors’ Successes and Failures in Economic Extraction

8-2. GNP of Various Countries and Regions, 1986

Preface and Acknowledgments

DOES CONQUEST PAY? is a controversial but little-studied question in international politics. That conquerors can harness captured economies is a longstanding premise of realist balance-of-power strategy and theory. But the virulence of nationalism, the correlation between development and democracy, the long postwar peace, and finally the collapse of the Soviet Empire have suggested to many observers that conquest no longer pays. The importance of economic resources to power means that the truth of the matter is relevant to the likelihood of expansion and the need for balancing strategies like containment. Yet the study of resource cumulativity has been confined to historical works on specific occupations and empires.

This book will argue that invaders can, in fact, make conquest pay in the limited sense that they can exploit seized industrial economies for their own purposes. To demonstrate this, I have assembled evidence on the imperial revenues, policing costs, and productivity of several twentieth-century occupations and empires. The evidence shows that modern societies can be mobilized intensively in the short run or controlled and farmed in the long run. This is true, however, only for ruthless oppressors. Invaders who are morally, internationally, or economically constrained from applying coercion and repression find their attempts at exploitation foiled by massive popular opposition.

Understanding why and when conquest pays, despite the power of nationalism, requires analyzing the sources of collaboration and resistance. It is the economic and political behavior of a nation’s leaders, bureaucracies, firms, and individual citizens that determines the profitability of conquest. The variety of important actors and circumstances make this an extremely complex subject. But patterns of collaboration and resistance appear to reflect different levels of coercion, repression, and modernization. To explain this, I draw on theories of coercion and collective action, combined with basic features of modernization. These theories and the evidence suggest, in contrast to commonly held notions, that modern industrial societies are in many respects more vulnerable to coercion and repression than less-developed ones.

Collaboration, resistance, and their impact on economic extraction need interdisciplinary study. Interactions between invaders and invaded often resemble relations among states and have important ramifications for the quality of life in the international system. But rule by invaders or their proxies is also close to the subject of comparative politics, political sociology, and political economy. Although none of these fields has specifically addressed the profitability of conquest, they all offer relevant theoretical insights. For evidence, I have relied on specialized histories and governmental reports on individual occupations and conquests. By abstracting a few key measures and causes from their rich accounts of extraordinarily complex events, and by using the comparative method to test specific hypotheses, it is possible to identify and explain simple, recurring patterns not fully revealed by prior historical research.

This book does not try to cover all consequences of conquest. By defining profitability narrowly, in terms of the economic benefits and costs provided or imposed directly by the conquered societies themselves, I leave aside external and noneconomic costs and benefits, such as the war costs of taking territory and defending it from outside powers, the losses caused by economic sanctions, the strategic advantages of eliminating neighboring enemies, and the utility of captured military manpower. Conquest usually does not pay in the larger reckoning, as Napoleon, Hitler, and other aggressors learned, because conquerors are usually vanquished in the end by defensive alliances. But the exploitability of captured industrial economies is by itself important and poorly enough understood to merit separate study.

This book also does not grapple with the atrocities and suffering resulting from conquest and empire, however horribly momentous they may be. Conquerors have committed some of the most evil crimes of genocide, torture, slavery, oppression, and discrimination in history. My purpose here, though, is to measure the profitability of conquest and identify its causes. Besides noting the coercion and repression applied to make the conquest of nationalistic societies pay, I will not explore the vast human costs that were also involved. I hope such a focused analysis will not be misread as an effort to sanitize or condone conquest, coercion, repression, or worse. Rather, it is a modest attempt to contribute to knowledge that may help prevent their recurrence.

This book would not have been possible without the help of many teachers, colleagues, and institutions. My greatest debt is to Barry Posen, who first suggested this topic to me and has been an inspiring mentor. Kenneth Oye, Douglass Forsyth, and Stephen Van Evera provided incisive criticism and suggestions at crucial stages of the project. Steve’s persistent prodding was especially instrumental in helping me to clarify my ideas and writing.

For comments and advice on earlier drafts of one or more chapters, I thank James Alt, Suzanne Berger, Tom Christensen, Joshua Cohen, Andrew Cortell, Neta Crawford, Michael Desch, Steven Flank, Aaron Friedberg, John Gillingham, Carl Kaysen, Beth Kier, Jon Kirshner, Jonathan Mercer, Steven Miller, Alan Milward, Ramon Myers, Robert Keohane, Jaroslav Krejčí, Kevin Oliveau, Mark Peattie, Laura Reed, Alan Rousso, David Rowe, Richard Samuels, Jack Snyder, Ray Taras, Brian Taylor, Alice Teichova, Kenneth Waltz, and Werner Warmbrunn. Extra thanks are due to the historians among this group for their generous help across disciplinary lines.

I would also like to thank Colin Borstal, Edward Guernica, and Robert Lane Greene for research assistance, Lee Liberman and David Nelson Blair for editorial help, and Malcolm DeBevoise and Beth Gianfagna for shepherding the manuscript through publication.

Financial support for this work was provided by MIT’s Defense and Arms Control Studies Program, the Ford Foundation’s Program in Western Security and European Society, the John D. and Catherine T. MacArthur Foundation, the John M. Olin Institute for Strategic Studies, and Tulane University’s Committee on Research. The DACS Program at MIT and the Ford and Olin programs at Harvard University’s Center for International Affairs provided stimulating intellectual environments for most of the research and writing of this book. I am grateful to their staffs and especially their directors, Jack Ruina and Harvey Sapolsky of MIT, Richard Eichenberg of the Ford Program, and Samuel P. Huntington of the Olin Institute. I also thank my colleagues and students at Tulane University for their ideas and patience while I completed this book.

Portions of this book originally appeared as The Spoils of Conquest and are reprinted with permission from International Security 18, no. 2 (Fall 1993), published by MIT Press. Copyright (c) 1993 by President and Fellows of Harvard College and the Massachusetts Institute of Technology. I thank the journal and its publishers for permission to use the material here.

Finally, I am deeply grateful to my parents and to Sarah Soffer for their love and moral support. Sarah’s laugh also helped me keep my sanity while I was spending so much time studying terrible events. This book is dedicated to her.

DOES CONQUEST PAY?

CHAPTER 1

Does Conquest Pay?

DOES CONQUEST PAY in the modern era? Can invading powers mobilize the economic resources of occupied industrial societies? Or do nationalistic societies frustrate invaders by imposing high costs and denying economic gains? What factors influence the size of imperial profit margins, and why? These questions are the subject of enduring disagreement among policymakers, analysts, and scholars. Many have found it selfevident that industrial nations are potentially cumulative or transferable economic resources. Others have believed just as firmly that the conquest of modern societies is economically futile. These diametrically opposite opinions lie at the root of longstanding debates in foreign policy and international relations theory.

Nevertheless, these questions have never been subjected to systematic analysis. Claims on one side or the other are rarely supported with more than casual hypotheses and anecdotal data. Political scientists have analyzed the ability of states to mobilize domestic resources, as well as the causes of imperialism and overexpansion (i.e., expansion despite negative marginal returns).¹ Historians have studied particular cases of exploitation but have focused their comparative efforts on preindustrial empires.² The gains to conquerors from eliminating potential enemies and using conquered territory—as well as the losses suffered at the hands of imperial rivals and defensive coalitions—have been studied extensively by international relations historians and theorists.³ But whether the conquest of industrial economies pays, aside from the costs of conquering territory and the costs imposed by retaliating third parties, is more controversial, as shall soon become clear.

This book attempts to measure and explain the profitability of conquest by examining several historical episodes of hostile occupation through the lenses of social-science theory. Germany occupied and tried to mobilize Belgium and Luxembourg during the First World War. After that war, the victorious Allies partially occupied and attempted to extract reparations from Germany, forcefully in the Ruhr operation of 1923-24. Nazi Germany successfully mobilized Western Europe during World War II. Meanwhile, Japan had constructed a passive and economically dynamic empire out of Taiwan, Korea, and Manchuria. The end of the second great conflagration found the Soviet Army in Central and Eastern Europe, where it remained until 1989. Each of these episodes has been studied individually by historians, but determining how thoroughly industrial economies can be harnessed by foreign occupiers, as well as identifying the factors that affect mobilization, requires comparative analysis.

THE ARGUMENT

In this book I will argue that ruthless invaders can, in fact, successfully exploit industrial societies, at least for short periods of time. Control over industrial societies, moreover, can be maintained for longer periods at relatively low expense. Also, the available evidence does not show that foreign domination per se precludes economic growth, although multinational empires are unlikely to be as robust as comparably sized and developed nation-states. Conquest does not always pay; nationalism ensures that conquerors unwilling to engage in coercion and repression will face massive political and economic resistance. But determined conquerors can put a lid on nationalism, if not eradicate it, and cultivate or exploit their new domains on demand.

In arguing that conquest pays, I mean only that a conqueror or occupier can extract a large percentage of the economic potential of industrial nations. Nationalism and people power alone cannot prevent ruthless states from extracting large imperial profits (revenues net of collections costs) from occupied industrial societies. In other words, industrialized economies are cumulative resources—the economies of captured nations can be added to a conqueror’s total economic base.⁴ This is not to say that conquest is profitable when all of its geopolitical consequences are considered (see table 1-1). The balance sheets evaluated in this book do not consider the costs of military conflict or economic sanctions imposed by states outside the empire, the benefit of neutralizing potentially hostile neighbors, or the utility of strategic territory. Mainly because other states balance against aggressors, conquest usually leads to disaster. Nor are industrial societies fully cumulative resources; if they were, conquerors could mobilize occupied economies as completely and efficiently as their own. The extraction rates (profits taken as a percentage of the nation’s economic potential) that can be reached are not as high as the resource-mobilization rates that nation-states can achieve domestically. But industrial societies are cumulative enough that conquerors can greatly increase their mobilizable economic base through expansion.

An explanation can be found in the sources of collaboration and resistance. Nationalism ensures that modern societies detest foreign domination, not to mention exploitation. But hostility and discontent are not enough to generate resistance. Coercion works, especially against societies unable to organize themselves for collective action. Since conquerors generally have superior coercive capabilities to militarily defeated societies and can repress social self-organization, they can compel defeated societies to collaborate politically and economically.

TABLE 1-1

Conquerors’ Costs and Benefits

a All trade effects depend in part on external factors.

Moreover, industrialization and other facets of socioeconomic development do not increase the bargaining position of occupied societies. While modernization does increase the potential for collective action, it also increases the efficiency of social coercion and repression. The result is that with a relatively small investment in the instruments of domination, and with an economic strategy that creates incentives for collaboration, ruthless conquerors—but only ruthless ones—can make defeated modern societies pay a large share of their economic surplus in tribute. Modernization increases nations’ social surplus, but without significantly increasing the costs of the coercion, repression, and administration needed to maintain and extort it.

These findings suggest that the conquest of industrial regions by an expansionist state can result in a drastic and possibly enduring shift in the international distribution of capabilities, lending support to realist arguments for balancing against expansionists. Another implication is that industrial empires, though less efficient than nation-states, are economically and politically durable as long as they are commanded by ruthless regimes. Since expansion can be self-reinforcing, moreover, the international system is more war-prone than many optimists claim. If conquest and empire have become less common in the modern age, we should be thankful for other causes of peace, like deterrence and democracy. In addition, guerrilla-based and civilian-based defenses are unlikely to work or even to be implemented by modern societies against coercive and repressive conquerors.

CONTENDING VIEWS

The cumulativity of resources is a matter of longstanding disagreement in the international relations field. But it has rarely generated open debate, because scholars’ and policymakers’ opinions on the subject are usually buried assumptions in complex theoretical and policy arguments. As a result, claims on either side are rarely specific. It is difficult to tell whether those who believe that conquest pays think that conquered economies are worth a comparable loyal province (that is, 100 percent cumulative) or worth only half (50 percent cumulative). The critics of this view are just as vague, suggesting alternatively that conquered economies are a liability, a net wash, or simply less cumulative now than in the past. Others argue that even when conquest pays initially for any given empire, at some point in size and time, the costs eventually exceed the benefits.⁵ Still, there is a clear divergence of opinion about the cumulativity of resources, particularly for industrial economies.

Imperial rulers and propagandists, unsurprisingly, have typically believed that conquest pays. In ancient Greece, Pericles claimed that the strength of Athens came from the money paid in tribute by her allied satellites throughout the Aegean, payments that matched Athenian domestic tax revenues. Athenians’ imperialism was fueled, according to their rivals, by their confidence that the farther they go the more they will get.⁶ Even the rise of nation-states in Europe can be seen as a repeating cycle of conquest, consolidation, and resource extraction.⁷

But the notion that conquest pays also informs a long tradition of balance-of-power thinking by realist statesmen and scholars. Statesmen and strategists have often urged their nations to build up against and contain expansionists on the assumption that conquest adds to expansionists’ power while eliminating potential members of defensive alliances. For example, Foreign Secretary Edward Grey of Great Britain wanted his country to stand by France and Russia in World War I, for if these nations were defeated, Germany would wield the whole power of the continent.⁸ American realists’ arguments for joining the war against Hitler were based on this premise as well, especially after France’s defeat in the summer of 1940 focused their attention on the geopolitical significance of a Nazi-dominated Europe. At least a year before Pearl Harbor and Hitler’s declaration of war, President Roosevelt himself had worried that if Great Britain goes down, the Axis powers will control the continents of Europe, Asia, Africa, Australia, and the high seas—and they will . . . bring enormous military and naval resources against this hemisphere.⁹ This view was echoed throughout the policy media before and during the war. In the April 1941 Foreign Affairs, an economist calculated that

the estimated annual shipbuilding capacity of countries now under Nazi rule ..., plus that of Japan, plus that of Italy, was about 2,300,000 gross tons at the outbreak of the war.. .. Nazi conquest of the British Isles [would add] about 2,500,000 gross tons. ... If that is a good estimate, it would take us more than four years to overtake totalitarian shipbuilding capacity, supposing that they stood still.¹⁰

Similarly, Walter Lippmann argued that the United States had to defeat Hitler because the potential military strength of the Old World is enormously greater than that of the New World.¹¹

After the war, Stalin’s domination of Eastern and Central Europe provoked fears that he had succeeded Hitler as a contender for European hegemony. Realists in and out of government supported a policy of containment, on the assumption that the Soviet Union could mobilize conquered industrial economies for war against the United States.¹² George Kennan, a key architect of the policy, explained that containment was necessary to assure that no single Continental land power should come to dominate the entire Eurasian land mass . .. become a great sea power as well as land power . .. and enter ... on an overseas expansion hostile to ourselves and supported by the immense resources of the interior of Europe and Asia.¹³ In the same vein, a 1948 National Security Council report stated that there are in Europe and Asia areas of great potential power which if added to the . .. Soviet world would enable the latter to become so superior in manpower, resources and territory that the prospect for the survival of the United States as a free nation would be slight.¹⁴ Containment, like the U.S. participation in the war against Hitler, was inspired by moral and economic motives as well. But even at the end of the cold war, its chief goal was still to prevent any hostile power or group of powers from dominating the Eurasian land mass.¹⁵

This focus on Eurasia stemmed from the belief that the wealthier the conquest, the more wealth and power gained—in other words, industrial economies were cumulative power resources. Kennan thus argued for limiting containment to the protection of only those centers of industrial and military power outside the United States and Russia—that is, Great Britain, Germany and Central Europe, and Japan—that have the requisite conditions of climate, of industrial strength, of population and of tradition capable of generating significant amphibious power.¹⁶ In 1951 Secretary of State Dean Acheson justified the deployment of additional U.S. troops to Europe by noting that outside our own country, free Europe has the greatest number of scientists, the greatest industrial production, and the largest pool of skilled manpower in the world. It has a tremendous shipbuilding capacity, essential to control of the seas.¹⁷ U.S. policy toward Japan was informed by similar reasoning. If Japan, the principal component of a Far Eastern war-making complex, were added to the Stalinist bloc, argued a 1949 NSC report, the Soviet Asian base could become a source of strength capable of shifting the balance of world power to the disadvantage of the United States.¹⁸ And while the United States also made commitments to geopolitically insignificant nations during the cold war—due to beliefs in falling dominoes, bandwagoning, and the monolithic nature of communism—critics of global containment continued to argue for defending Western Europe, Japan, and the Persian Gulf.¹⁹

Most balance-of-power theorists share the strategists’ premise that economic resources are cumulative. Formal theorists explicitly state their assumption that resources are freely transferable and are fully absorbed by victorious powers.²⁰ The same thinking is evident in traditional theorizing about international politics. The British geographer Halford Mackinder wrote in 1904 that the political consolidation of the Eurasian continent would permit the use of vast continental resources for fleetbuilding, and the empire of the world would then be in sight.²¹ Mackinder’s early speculations gave little credit to the impediment of national loyalties: Were the Chinese . . . organized by the Japanese, to overthrow the Russian Empire and conquer its territory, they might constitute the yellow peril to the world’s freedom just because they would add an oceanic frontage to the resources of the great continent, an advantage as yet denied to the Russian tenant of the pivot region.²² Nicholas Spykman, an American political scientist and a devotee of Mackinder’s geopolitics, agreed that expansionists throughout history made each new conquest the stepping stone for further enlargement. Power tends to grow and diffuse through wider areas, and the states in the vicinity have the choice between collective defense and ultimate absorption.²³ Hans Morgenthau gave more credit to national character and morale as sources of power. But he also thought that conquest without prospects for speedy recovery usually breaks the will to resist of the conquered people and amounts to a piecemeal change in the power relations in favor of the imperialistic nation.²⁴ One can find the same premise in Kenneth Waltz’s explanation of the priorities in U.S. foreign policy: Only Japan, Western Europe, and the Middle East are prizes that if won by the Soviet Union would alter the balance of GNPs and the distribution of resources enough to be a danger.²⁵

But the notion that GNPs can be transferred between capitals like money wired between banks has long had its critics. Adam Smith’s The Wealth of Nations, published in the same year that the American colonists declared their independence, concluded with a diatribe against maintaining the showy equipage of colonies that contribute neither revenue nor military force towards the support of an empire.²⁶ Smith thought that empire drained the mother country because the costs of seizing and defending colonies from imperial rivals typically exceeded the low revenues collected from them.

Subsequent critics advanced a more ambitious claim, that even cheap and unopposed conquest among modern states did not pay. The British free-trade advocate Richard Cobden argued in 1849 that where one empire will take possession, by force of arms, of its neighbor’s territory ... the accession of territory would be a source of weakness, not of strength.²⁷ On the eve of World War I, Norman Angell’s The Great Illusion popularized the notion that the exaction of tribute from a conquered people has become an economic impossibility.²⁸ Political scientists and economists resuscitated Angell’s claims starting in the early 1960s.²⁹ Klaus Knorr argues that the conquest of territory for economic reasons has become an anachronism.³⁰ One economist claims that the extent to which the conquest of new territory added to the economic strength of the conqueror is questionable, and another agrees that much of the surplus that accrues to modern populations is simply not available to a conqueror.³¹

These quagmire theorists also claim that conquest among modern nations is especially unprofitable. Angell believed that, while colonial exploitation was still possible, the property rights upon which industrial society had been built precluded economic exploitation. Later writers have stressed the impact of nationalism, a phenomenon unique to developing and modern societies. For example, Robert Gilpin’s War and Change in World Politics (1981) argues that in the premodern era, the size of the economic surplus from agriculture and imperial tribute was principally a function of the extent of territorial control. Therefore, other things being equal, the greater the territorial extent of an empire ... the greater the power of the empire.³² But in the modern world, according to Gilpin, the nation-state proved a more efficient unit of political and economic organization because it commands the loyalty of nationalistic populations. By contrast, empires were able to enlist and secure the loyalty of only a small fraction of their inhabitants . . . [accounting] for the ultimate fragility of empires in the face of internal revolts and external pressures.³³ Other theorists have updated Angell’s economic argument with reasons why new possibilities for economic noncooperation inhere in modern forms of production.

The opposing positions about the cumulativity of resources correspond roughly to two traditions of international relations thought, realist and liberal. The resource-cumulativity view underlies old realist tenets about the importance and likelihood of balancing against expansionists, the utility of military power, and the war-proneness of the international system. The quagmire view has a classical liberal pedigree, going back to Cobden, Angell, and even earlier liberal economists, who used it to make archetypical liberal arguments against imperialism, for isolationism and disarmament, and in support of the notion that war among developed nations had become obsolete.

But particular claims about the cumulativity of resources are not entailed by the core axioms of realist and liberal international theory, and the correlation between the claims and the schools is far from perfect. Since the central idea of realism is that the international system is an anarchic, self-help arena, realists like Klaus Knorr and Robert Gilpin can argue without inconsistency that conquered industrial nations are not cumulative resources. (Still, realist balance-of-power strategists and theorists contradict their own assumptions about economic prizes by claiming, as does Kenneth Waltz, that force is always on the side of the governed.³⁴) Core liberal doctrines about the shared costs of trade barriers and war and the pacific effects of trade also do not entail specific presumptions about the cumulativity of resources. Thus the liberal philosopher Jeremy Bentham could argue that while overseas imperialism was economically futile, continental conquest paid: The new property, being contiguous, is laid on his old property. ... the inhabitants, as many as he thinks fit to set his mark on, go to increase his armies; their substance, as much as he thinks fit to squeeze from them, goes into his own purse.³⁵ While there is a definite correspondence of beliefs about the cumulativity of resources to realism and liberalism, these beliefs cannot be neatly pigeon-holed into such diverse schools of thought.

WHY THE CUMULATIVITY OF RESOURCES MATTERS

Two important debates in international relations theory depend at least in part on whether conquest pays. Analyzing the cumulativity of resources should help us understand when states should balance against expansionists and should help us predict when they will do so. Understanding the likelihood of war also requires analyzing the cumulativity of resources. In addition, research on foreign domination and resource cumulativity helps answer two other questions: How great is the potential of modern people power to frustrate detested rule? Can this potential be tapped by guerrilla or