Rising Muslim schizophrenia: an investor's guide to globalization and the war on terror.

• Author: Zoakos, Criton M.

The current political debate over the war in Iraq has become tendentious and unproductive. Most of the issues debated now--whether Iraq is part of the war on terror or not, whether we are "winning" or "losing" in Iraq, whether Saddam had weapons of mass destruction, whether he had connections with al Qaeda, or whether "mistakes were made," and so forth, ad nauseam--are dominated by partisan posturing. Their outcome will not have the slightest effect on the course of the war. The war is following its own logic, forcing the adversaries' hands at each step of the way.

The war decisions of nations are driven by sheer necessities of survival, not by the outcomes of partisan debates. On matters of sheer survival, people, from ordinary voters to national leaders, are forced into decisions they would not have imagined moments earlier. Cumulatively, these strings of previously unimaginable decisions are known as "the fortunes of war." These are not susceptible to forecasting.

However, from the standpoint of investment decision making and of financial markers generally, there are four useful things to know about the war--things that cut through the passions of partisan debate and through the fog of war:

* This war is the point of the spear in the fight over globalization--regardless of the deceptive pseudo-theological garb its Islamist combatants have chosen.

* It is a risk-reducing, not a risk-augmenting enterprise.

* It is less costly than the Cold War.

* It will not end at the pleasure of political decision makers in the United States. It will end when clear victory or clear defeat comes--regardless of which party is in power in the United States.

THE WAR AS STRUGGLE OVER GLOBALIZATION

Privatization, financial transparency, rule of law, trade liberalization, even central bank independence, are not culture-neutral. The great themes of globalization are not culture-neutral; they are a menace to traditional cultures, Islam included. They subvert the status and authority of village elders, shamans, tribal sheikhs, princes and potentates, intellectual classes that function as curators of traditional cultures, hordes of state-franchised compradors, and other worthies who make their illustrious parochial living by sucking on the cultures that globalization subverts.

Compared to the epic strides toward economic integration made by the rest of the world, the domain of Islamic countries looks like The Land That Time Forgot. Iran's Islamic Revolution came to power and proposed isolation at approximately the same time as Deng Xiaoping opened up China to the world economy. Since that time, Islam's economic weight plunged below its already measly levels.

The OIC (Organization of the Islamic Conference) reports that its fifty-six member countries comprise 20 percent of the world population--but produce only 5 percent of world GDP...