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Since the initial panic and hysteria about Edward Snowden’s national security leaks has settled, cooler analysis reveals that the impact of his historic data theft is not as serious as previously thought. At least that’s the impression given recently by the new director of the NSA, Adm. Michael Rogers, and the director of national intelligence, James Clapper.
Such revisionism does not sit well with some. National security blogger John Schindler (@20committee) writes in his latest post that “it would be foolish to assume that the SIGINT losses it has engendered are not commensurately vast.”
Schindler goes on to cite one particularly significant case from the 1950s that has similarities to Snowden’s, but as one reads about it, one cannot help but wonder if those intelligence disasters of the 1950s such as the revelation of VENONA, a program that cracked Soviet codes, actually meant anything in the long term.
How did such espionage successes help the Soviets, for example, if the USSR ultimately fell apart? Even if they were useful in a few circumstances to the Soviets, in the long term they meant absolutely nothing. And they couldn’t mean anything because no matter how successful the KGB was, it was the Soviet Union’s fundamental structural weaknesses – its dysfunctional institutions and economic system and its political culture – that undermined its long-term prospects and ultimately led to its collapse. It was also these weaknesses that prevented the Soviets from making use of the secrets they did steal.
Knowing even the biggest secrets is irrelevant if you can do little or nothing about them. The ability to act on knowledge is, for most revisionist regimes, undermined by fundamental systemic weaknesses, as was the case in the USSR and the rest of the Eastern Bloc. Most revisionist states are working at a fundamental disadvantage as their rules, norms and standards – their markets and political institutions – are fundamentally flawed and dysfunctional, in part because the revolutions that create them often ignore the good aspects of fallen systems, and innovating new norms and rules is harder than it seems.
Ideological slogans that erect the barricades and compel the masses to storm the palaces do not make for good public policy. In the end, because of their economic and political problems, such challengers are unable to make use of whatever information they manage to steal through espionage. Fundamental systemic weaknesses are more 
significant as factors working against America’s enemies and overcoming whatever momentary triumphs of intelligence these actor can muster.
Consider the matter of nuclear secrets, which were compromised in the 1950s thanks to an extensive Soviet spy network in America. While the Soviets were able to steal nuclear secrets and make a few bombs, they were not capable of ever matching the quantity or the quality of America’s nuclear arsenal, regardless of the rhetoric about a missile gap. In fact, the U.S. had more and better quality nuclear weapons. And the quality gap meant that most of Soviet missiles would never leave the ground, while those that did might fly off target or simply never reach the other side of the globe. What seemed like a catastrophe for the U.S. and a great intelligence coup for the Soviets, the theft of America’s nuclear secrets, ultimately proved meaningless in the calculus of forces that determined the fate of the Soviet Union and the course of the Cold War.
Similarly, Snowden’s disclosures will ultimately prove irrelevant to the calculus of forces that determines the fate of America and the West. While it is true that some of America’s enemies may have the technical skill to affect national communications, in the long term this does not matter. Why?
It is important to remember that the American’s most important asset – its talent for developing new technologies of surveillance – has not been affected. Even if Russia or China do go black, for example, this will not be permanent, as the NSA is very likely to innovate new surveillance methods, while Russia and China, because of the fundamental structural limitations which impact their innovation in high technology, will not readily be able to create new defenses quickly.
At the other end of the spectrum, if non-state actors simply forgo using email and cell phones, this too will have no long-term negative impact. Ever since Vietnam, it has been clear that asymmetric warfare is warfare that America is not particularly good at waging. This has not changed, and regardless of the variabled of communication technology it will not change, because of the logic of asymmetries of power and their political consequences first pointed out by Andrew Mack in his famous paper “Why Big Nations Lose Small Wars.”
Rules, norms and standards have immense transformative power of their own and those nations whose rules, norms and standards are seen as producing superior national outcomes in increasing power and wealth and opportunity will gain power over their rivals. Rules, norms and standards have this power when they build trust. Systems that engender trust have an edge over those which are corrupted by arbitrariness.
In the long term, espionage successes or failures don’t really matter, though they make great headlines and political spectacle. A nation’s greatest assets and defenses are a good systems of rules, norms and standards that govern its politics and economics, and a good political culture. A nation’s greatest enemy is dysfunction in its own systems of government, jurisprudence and markets. A nation in which institutions, political culture and the markets work well will have a fundamental advantage over one in which corruption destroys the operation of these systems. It wasn’t Russia or China that engineered the financial crash of 2008 – it was greed, intellectual fraud, and dumb – as opposed to smart – deregulation. Yet the damage was profound as it destroyed millions of economic lives.
Like that of all great nations and empires before it, America’s downfall will not happen as a result of the actions of a few but as a result of the growth of dysfunctional patterns and incentives in the system itself.
