America's enemies intend to subvert the marketplace
American capitalism – led by and caricatured as the financial industry centered on Wall Street – is predicated on the notion that the market is driven by fundamentally economic motives. To its admirers, that means its dynamics are dictated by profit motivation. Wall Street's critics call it greed.
The rules and regulations that govern our stock transactions largely reflect this assumption. We discourage undesirable behavior primarily by levying fines and otherwise making it costly to engage in it.
Forgive the obviousness of this question but, what if actors who are interested in affecting our stock market and economy more generally are motivated not by making money but by some larger strategic interest? In that case, financial disincentives are likely to prove completely ineffectual.
For example, would our present Maginot Line of financial defenses – much of them constructed by legislators bearing names such as Christopher Dodd, Barney Frank, Paul Sarbanes and Michael Oxley – protect us if avowed enemies of this country sought to inflict a major, and possibly decisive, blow against us and didn't care if they lost money in the process?
This proposition is explored in a riveting book that will be published this month by one of my colleagues, Kevin D. Freeman, a senior fellow of the Center for Security Policy. In fact, as the title of "Secret Weapon: How Economic Terrorism Brought Down the U.S. Stock Market and Why It Can Happen Again"suggests, Mr. Freeman's thesis is that it already has occurred, with devastating effect, and that worse may be in the offing.