Nye is dean of the John F. Kennedy School of Government at Harvard University and a former assistant secretary of Defense for international affairs in the Clinton administration. Owens is former vice chairman of the Joint Chiefs of Staff in the Clinton administration. This material is excerpted from an article in FOREIGN AFFAIRS, March/April 1996.

The Power and Resources of the Future

Knowledge more than ever before, is power. The one country that can best lead the information revolution will be more powerful than any other. For the foreseeable future, that country is the United States. America has apparent strength in military power and economic production. Yet, its more subtle comparative advantage is its ability to collect, process, act upon, and disseminate information, an edge that will almost certainly grow over the next decade. This advantage stems from Cold War investments and America's open society, thanks to which it dominates important communications and information processing technologies -- space-based surveillance, direct broadcasting, high-speed computers -- and has an unparalleled ability to integrate complex information systems.

This information advantage can help deter or defeat traditional military threats at relatively low cost. In a world in which the meaning of containment, the nuclear umbrella, and conventional deterrence have changed, the information advantage can strengthen the intellectual link between U.S. foreign policy and military power and offer new ways of maintaining leadership in alliances and ad hoc coalitions.

The information edge is equally important as a force multiplier of American diplomacy, including "soft power" -- the attraction of American democracy and free markets. The United States can use its information resources to engage China, Russia, and other powerful states in security dialogues to prevent them from becoming hostile. At the same time, its information edge can help prevent states like Iran and Iraq, already hostile, from becoming powerful. Moreover, it can bolster new democracies and communicate directly with those living under undemocratic regimes. This advantage is also important in efforts to prevent and resolve regional conflicts and deal with prominent post-Cold War dangers, including international crime, terrorism, proliferation of weapons of mass destruction, and damage to the global environment.

Yet, two conceptual problems prevent the United States from realizing its potential. The first is that outmoded thinking clouds the appreciation of information as power. Traditional measures of military force, gross national product, population, energy, land, and minerals have continued to dominate discussions of the balance of power....

The second conceptual problem has been a failure to grasp the nature of information. It is easy to trace and forecast the growth of capabilities to process and exchange information. The information revolution, for example, clearly is in its formative stages, but one can foresee that the next step will involve the convergence of key technologies, such as digitization, computers, telephones, televisions, and precise global positioning. But to capture the implications of growing information capabilities, particularly the interactions among them, is far more difficult. Information power is also hard to categorize because it cuts across all other military, economic, social, and political power resources, in some cases diminishing their strength, in others multiplying it....

Military Capability and Information

The character of U.S. Military forces is changing, perhaps much more rapidly than most appreciate, for, driven by the information revolution, a revolution in military affairs is at hand. This American-led revolution stems from advances in several technologies and, more important, from the ability to tie these developments together and build the doctrines, strategies, and tactics that take advantage of their technical potential.

ISR is the acronym for intelligence collection, surveillance, and reconnaissance. Advanced C4I refers to technologies and systems that provide command, control, communications, and computer processing. Perhaps the best-known advance is precision force, thanks to the videotapes of precision-guided munitions used in Operation Desert Storm. The latter is a broader concept than some imagine, for it refers to a general ability to use deadly violence with greater speed, range, and precision.

In part because of past investments, in part serendipitously, the United States leads other nations in each of these areas, and its rate of improvement will increase dramatically over the next decade....

These technologies provide the ability to gather, sort, process, transfer, and display information about highly complex events that occur in wide geographic areas. However, this is important for more than fighting wars. In a rapidly changing world, information about what is occurring becomes a central commodity of international relations, just as the threat and use of military force was seen as the central power resource in an international system overshadowed by the potential clash of superpowers.

There has been an explosion of information. Yet, some kinds of information -- the accurate, timely, and comprehensible sort -- are more valuable than others. Graphic video images of Rwandan refugees fleeing the horror of tribal hatreds may generate worldwide sympathy and demands for action. But precise knowledge of how many refugees are moving where, how, and under what conditions is critical for effective action.

Military information on the disposition, activity, and capabilities of military forces still ranks high in importance because military force is still perceived as the final arbiter of disagreements. More to the point, concerns that military force may be used still figure prominently in what states do.

The growing interdependence of the world does not necessarily establish greater harmony. It does, however, make military force a matter of interest to audiences outside the local theater. The direct use of military force no longer calls up the specter of escalation to global nuclear holocaust, but it remains a costly and dangerous activity....

The concept of deterrence undergirding the emerging American military system of systems envisions a military strong enough to thwart any foreign military action without incurring a commensurate military risk or cost. Those who contemplate a military clash with the United States will have to face the prospect that it will be able to halt and reverse any hostile action, with low risk to U.S. forces....

The Information Umbrella

The information technologies driving America's emerging military capabilities may change classic deterrence theory. Threatening to use military force is not something Americans will do automatically or easily and has always had some undesirable side effects. In an era in which soft power increasingly influences international affairs, threats and the image of arrogance and belligerence that tends to go with them undercut an image of reason, democracy, and open dialogue.

America's emerging military capabilities -- particularly those that provide much more real-time understanding of what is taking place in a large geographical area -- can help blunt this paradox. They offer, for example, far greater pre-crisis transparency. If the United States is willing to share this transparency, it will be better able to build opposing coalitions before aggression has occurred. But the effect may be more general, for all nations now operate in an ambiguous world, a context that is not entirely benign or soothing.

In this setting, the emerging U.S. capabilities suggest leverage with friends similar to what extended nuclear deterrence once offered. The nuclear umbrella provided a cooperative structure, linking the United States in a mutually beneficial way to a wide range of friends, allies, and neutral nations. It was a logical response to the central issue of international relations -- the threat of Soviet aggression. Now the central issue is ambiguity about the type and degree of threats, and the basis for cooperation is the capacity to clarify and cut through that ambiguity.

The set of fuzzy guidelines and meanings the Cold War once provided has been replaced by a deeper ambiguity regarding international events. Because nearly all nations viewed the international system through Cold War lenses, they shared much the same understanding. To nations throughout the world, the character and complexities of a civil war in the Balkans would have been far less important than the fact of disruption there because the event itself could have triggered a military confrontation between NATO and the Warsaw Pact. Details on the clashes between Chinese and Soviet border guards did not really matter; what counted was that a split had appeared in one of the world's great coalitions. Now the details of events seem to count more. With the organizing framework of the Cold War gone, the implications are harder to categorize, and all nations want to know more about what is happening and why to help them decide how much it matters and what they should do about it. Coalition leadership for the foreseeable future will proceed less from the military capacity to crush any opponent and more from the ability quickly to reduce the ambiguity of violent situations, to respond flexibly, and to use force, where necessary, with precision and accuracy.

The core of these capabilities -- dominant situational knowledge -- is fungible and divisible. The United States can share all or part of its knowledge with whomever it chooses. Sharing would empower recipients to make better decisions in a less-than-benign world, and should they decide to fight, they could achieve the same kind of military dominance as the United States.

These capabilities point to what might be called an information umbrella. Like extended nuclear deterrence, they could form the foundation for a mutually beneficial relationship. The United States would provide situational awareness, particularly regarding military matters of interest to other nations. Other nations, because they could share this information about an event or crisis, would be more inclined to work with the United States.

The beginnings of such a relationship already exist. They were born in the Falklands conflict and are being developed today in the Balkans. At present, the United States provides the bulk of the situational awareness available to the Implementation Force, the U.N. Protection Force, NATO members, and other nations involved in or concerned with the conflict there. It is possible to envision a similar central information role for the United States in other crises or potential military confrontations, from clarifying developments in the Spratly Islands to cutting through the ambiguity and confusion surrounding humanitarian operations in Cambodia and Rwanda. Accurate, real-time, situational awareness is the key to reaching agreement within coalitions on what to do and is essential to the effective use of military forces, whatever their roles and missions....

All this implies selectively sharing U.S. dominant battlespace knowledge, advanced C4I, and precision force. Old-era thinking might recoil from such a prospect, and it would have to overcome long-established prejudices against being open and generous with what might broadly be called intelligence. In the past, two presumptions supported this reluctance: first, that providing too much of the best information risked disclosing and perhaps even losing the sources and methods used in obtaining it, and second, that sharing information would disclose what the United States did not know and reduce its status as a superpower.

These assumptions are now even more questionable than before. The United States is no longer in a zero-sum game that makes any disclosure of capabilities a potential loss for itself and a gain for an implacable opponent. The character of this growing prowess is different. For one thing, the disparity between the United States and other nations is quite marked. U.S. investment ISR -- particularly the high-leverage space-based aspects of this set of systems -- exceeds that of all other nations combined, and America leads by a considerable margin in C4I and precision force as well....

Some other nations could match what the United States will achieve, albeit not as early. The revolution is driven by technologies available worldwide. Digitization, computer processing, precise global positioning, and systems integration -- the technological bases on which the rest of the new capabilities depend -- are available to any nation with the money and the will to use them systematically to improve military capabilities. Exploiting these technologies can be expensive. But more important, there is no particular incentive for those nations to seek the system of systems the United States is building -- so long as they believe they are not threatened by it. This is the emerging symbiosis among nations, for whether another nation decides to make a race out of the information revolution depends on how the United States uses its lead. If America does not share its knowledge, it will add incentives to match it. Selectively sharing these abilities is therefore not only the route of coalition leadership but the key to maintaining U.S. military superiority....

The Soft Side of Information Power

One of the ironies of the twentieth century is that Marxist theorists, as well as their critics, such as George Orwell, correctly noted that technological developments can profoundly shape societies and governments, but both groups misconstrued how. Technological and economic change have for the most part proved to be pluralizing forces conducive to the formation of free markets rather than repressive forces enhancing centralized power.

One of the driving factors in the remarkable change in the Soviet Union was that Mikhail Gorbachev and other Soviet leaders understood that the Soviet economy could not advance from the extensive, or industrial, to the intensive, or postindustrial, stage of development unless they loosened constraints on everything from computers to Xerox machines -- technologies that can also disseminate diverse political ideas. China tried to resist this tide, attempting to limit the use of fax machines...but the effort failed. Now not only fax machines but satellite dishes have proliferated in China....

This new political and technological landscape is ready-made for the United States to capitalize on its formidable tools of soft power, to project the appeal of its ideals, ideology, culture, economic model, and social and political institutions, and to take advantage of its international business and telecommunications networks....

In this information-rich environment, those responsible for four vital tasks can draw on America's comparative advantage in information and soft power resources. These tasks are aiding democratic transitions in the remaining communist and authoritarian states, preventing backsliding in new and fragile democracies, preempting and resolving regional conflicts, and addressing the threats of terrorism, international crime, proliferation of weapons of mass destruction, and damage to the global environment. Each requires close coordination of the military and diplomatic components of America's foreign policy.

Engaging Undemocratic States and Aiding Democratic Transitions

Numerous undemocratic regimes survived the Cold War, including not only communist states such as China and Cuba, but a variety of unelected governments formed by authoritarians or dominant social, ethnic, religious, or familial groups. Ominously, some of these governments have attempted to acquire nuclear weapons, among them Libya, Iran, Iraq, and North Korea. U.S. policies toward these countries are tailored to their respective circumstances and international behavior. The United States should continue selectively to engage those states, such as China, that show promise of joining the international community, while working to contain those regimes, like Iraq's, that offer no such hope. Whether seeking to engage or isolate undemocratic regimes, in every case the United States should engage the people, keeping them informed on world events and helping them prepare to build democratic market societies when the opportunity arises.

Organizations such as the U.S. Information Agency are vital to the task of aiding democratic transitions. Again China is instructive. The USIA international broadcasting arm, the Voice of America, has in the last few years become the primary news source for 60 percent of the educated Chinese....

Protecting New Democracies

Democratic states have emerged from the communist Soviet bloc and authoritarian regimes in other regions, such as Latin America, where for the first time every country but Cuba has an elected government. A major task for the United States is preventing their reversion to authoritarianism....

An important program here is the International Military Education and Training program. Begun in the 1950s, IMET has trained more than half a million high-level foreign officers in American military methods and democratic civil-military relations. With the end of the Cold War, the program has been expanded to deal with the needs of new democracies and emphasizes training civilians to oversee military organizations and budgets....

Preventing and Resolving Regional Conflicts

Communal conflicts, or conflicts over competing ethnic, religious, or national identities, often escalate as a result of propaganda campaigns by demagogic leaders, particularly those who want to divert attention from their own failings, establish their nationalist credentials, or seize power. Yet in developing countries, telephones, television, and other forms of telecommunication are rapidly growing, creating an opening for information campaigns by USIA and other agencies to undermine the artificial resolve and unity created by ethno-nationalist propaganda. At times, U.S. military technology may be used to suppress or jam broadcasts that incite violence, while USIA can provide unbiased reportage and expose false reports....

The negotiation of the Bosnian peace agreement at Dayton, Ohio, last fall illustrated a diplomatic dimension of information power. The United States succeeded in getting an agreement where for years other negotiating parties had failed in part because of its superior information assets. The ability to monitor the actions of all parties in the field helped provide confidence that the agreement could be verified while detailed maps of Bosnia reduced potential misunderstandings....

Crime, Terrorism, Proliferation, and the Environment

The fourth task is to focus U.S. information technology on international terrorism, international crime, drug smuggling, proliferation of weapons of mass destruction, and the global environment. The director of the CIA, John M. Deutch, has focused his agency's efforts on the first four of these, while the State Department's new Office of Global Affairs has taken the lead on global environmental issues. Information has always been the best means of preventing and countering terrorist attacks, and the United States can bring the same kind of information processing capabilities to bear abroad that the FBI used domestically to capture and convict the terrorists who bombed the World Trade Center....

The United States has used its information resources to uncover North Korea's nuclear weapons program and negotiate a detailed agreement for its dismantlement, to discover Russian and Chinese nuclear cooperation with Iran quickly and discourage it, to bolster U.N. inspections of Iraqi nuclear facilities, and to help safeguard enriched uranium supplies throughout the former Soviet republics. And mounting evidence on environmental dangers such as global warming and ozone depletion, much of it gathered and disseminated by American scientists and U.S. government agencies, has helped other states understand these problems and can now begin to point the way to cost-effective remedies....

The Coming American Century

The premature end of what Time magazine founder Henry Luce termed the American century has been declared more than once by disciples of decline. In truth, the 21st century, not the twentieth, will turn out to be the period of America's greatest preeminence. Information is the new coin of the international realm, and the United States is better positioned than any other country to multiply the potency of its hard and soft power resources through information. This does not mean that the United States can act unilaterally, much less coercively, to achieve its international goals. The beauty of information as a power resource is that, while it can enhance the effectiveness of raw military power, it ineluctably democratizes societies. The communist and authoritarian regimes that hoped to maintain their centralized authority while still reaping the economic and military benefits of information technologies discovered they had signed a Faustian bargain.

The United States can increase the effectiveness of its military forces and make the world safe for soft power, America's inherent comparative advantage. Yet, a strategy based on America's information advantage and soft power has some prerequisites. The necessary defense technologies and programs, ISR, C4I, and precision force, must be adequately funded....

Diplomatic and public broadcasting channels through which information resources and advantages can be applied must be maintained...Congress should...actively support USIA's efforts to exploit new technologies, including the agency's new Electronic Media Team, which is working to set up World Wide Web home pages on democratization and the creation and functioning of free markets.

The final and most fundamental requirement is the preservation of the kind of nation that is at the heart of America's soft power appeal. In recent years this most valuable foreign policy asset has been endangered by the growing international perception of America as a society riven by crime, violence, drug abuse, racial tension, family breakdown, fiscal irresponsibility, political gridlock, and increasingly acrimonious political discourse in which extreme points of view make the biggest headlines. America's foreign and domestic policies are inextricably intertwined. A healthy democracy at home, made accessible around the world through modern communications, can foster the enlargement of the peaceful community of democracies, which is ultimately the best guarantee of a secure, free, and prosperous world.

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On title page, credit the authors and carry: Reprinted by permission from FOREIGN AFFAIRS, March/April 1996. Copyright (C) 1996 by the Council on Foreign Relations, Inc.