Currency Wars_ The Making of the Next Global Crisis - James Rickards [11]
Down a corridor from the war room were separate large meeting rooms that had been outfitted as the “capitals” of the warring states. These were equipped with a single wall screen each and separate groupware shared only by the members of each team and accessed through additional sets of laptops for the team members. Other rooms had been set aside for summit conferences and bilateral negotiations if cells wanted to conduct private meetings away from the war room. All of the facilities—the war room, the capitals and the summit conference venues—were equipped with workstations for lab staff acting as facilitators, analysts and neutral observers of the proceedings. Although we were autonomous actors, it was hard to shake the feeling that we were also lab rats in the purview of APL’s larger mission.
We had a chance to get acquainted with the other players at a buffet-style breakfast served up by the lab. Then we filed into the war room and took our assigned places. The members of the white cell, the referees, were seated at the large trapezoid in the center. The five combatant teams, Russia Cell, U.S. Cell, Pacific Rim Cell, China Cell and Gray Cell (the “all other” group), and some Pentagon and intelligence community observers were seated in the chevron layout around the white cell.
Thanks to the secure Warfare Analysis Lab website, codenamed WALRUS, we had all been supplied in advance with thick packets of briefing books. One was the game overview, which provided the relative “national strength” of each team with a detailed rationale behind it. The overview included the instruction that “player cells may select actions from game menu and/or ‘innovate’ their own actions.” I was all for the innovation.
We also received “Baseline Scenario” briefing books, which described the near future economic world of 2012, in which we would be playing the game, and a “Mechanics” book, which was basically a rulebook. I recalled how my brothers and I used to fight over the rules in Risk as kids and often had to dig the Parker Brothers rulebook out of the game box to settle disputes. Now we had a war game rulebook, but this would go quite differently. I wanted to break as many rules as I could to help the Pentagon understand how capital markets really work in an age of greed, deregulation and bad intent. Wall Street was like the Wild West in the best of times, but with globalization and too-big-to-fail government backing, it was now even more out of control.
After a few hours of instruction, orientation and snap training on the groupware, we broke out to our separate capitals to work on move one. This broadly involved a long-term trade agreement between Russia and Japan that would reduce the availability of Russian oil and natural gas to the rest of the world. The big idea in move one was that Russia would leverage its natural resources to improve its foreign currency reserve position. Of course, there was no coordination between the scenario the lab had produced and the wild card Steve and I were secretly ready to play, but this was a pretty good fit. Russia could exempt Japan from its gold currency deal and still placate China by inviting it to join in its plan to sideline the dollar. I sat in our simulated Chinese capital listening to my Harvard and RAND teammates discussing how to punish Japan for deviating from the Washington Consensus free trade paradigm, but my mind was elsewhere, literally waiting for the phone to ring. A few minutes later, our lab observers informed us that a communiqué had come in from Russia requesting a summit conference. This was good news; it meant Steve had convinced his teammates to let him play the gold wild card.
Before my team could digest the news, I offered, “Hey, guys. My friend Steve Halliwell is playing the Russian cell—I’m guessing he’s behind this. Okay if I attend the summit from our side?”
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