Pentagon Game Simulates Global Economic Warfare
The exercise showed China to be the savviest economic operator
By Clay Dillow,  Newser Staff
Posted Apr 9, 2009 9:33 AM CDT
Notice who is staying out of the fray? Iin a recent Pentagon economic war simulation, China won by letting the US and Russia beat each other.   (AP Photo/Stefan Rousseau/PA)
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(Newser) – Last month, the Pentagon hosted a new kind of war game, focused not on a “shooting war,” but on how hostile states might damage the US economy, Politico reports. Instead of decorated military brass calling the shots, shirt-sleeved hedge fund managers, academics, and executives played out scenarios shifting the global balance of power through financial moves. The outcome: China won while the US and Russia got beaten by trying to beat each other.

The exercise is more than a game; China recently rattled the US by questioning the stability of its US bond holdings, forcing Obama to rush to the defense of the dollar. Five teams—the US, Russia, China, East Asia, and “all others”—responded to various calamities, like the collapse of North Korea, refereed by a sixth group. China emerged victorious, leading participants to acknowledge the grim fact that there are many ways the emerging superpower could amp up financial uncertainty in the US without damaging its own economy.