Underground Empire: How America Weaponized the World Economy

by Henry Farrell, Abraham Newman

Shortlisted for the Lionel Gelber Prize

A Responsible Statecraft best foreign policy book of 2023

A deeply researched investigation that reveals how the United States is like a spider at the heart of an international web of surveillance and control, which it weaves in the form of globe-spanning networks such as fiber optic cables and obscure payment systems

America’s security state first started to weaponize these channels after 9/11, when they seemed like necessities to combat terrorism—but now they’re a matter of course. Multinational companies like AT&T and Citicorp build hubs, which they use to make money, but which the government can also deploy as choke points. Today’s headlines about trade wars, sanctions, and technology disputes are merely tremors hinting at far greater seismic shifts beneath the surface.

Slowly but surely, Washington has turned the most vital pathways of the world economy into tools of domination over foreign businesses and countries, whether they are rivals or allies, allowing the U.S. to maintain global supremacy. In the process, we have sleepwalked into a new struggle for empire. Using true stories, field-defining findings, and original reporting, Henry Farrell and Abraham Newman show how the most ordinary aspects of the post–Cold War economy have become realms of subterfuge and coercion, and what we must do to ensure that this new arms race doesn’t spiral out of control.

Genres: Politics, Economics, Nonfiction, History, Business, Technology, Finance

281 pages, Kindle Edition

First published September 12, 2023

About the author

Henry Farrell is the Stavros Niarchos Foundation Agora Institute Professor of International Affairs at SAIS, and 2019 winner of the Friedrich Schiedel Prize for Politics and Technology. Previously, he served as a professor of political science and international affairs at George Washington University. He works on a variety of topics, including democracy, the politics of the internet, and international and comparative political economy. He is author of Of Privacy and Power: The Transatlantic Fight over Freedom and Security (with Abraham Newman, 2019) and The Political Economy of Trust: Interests, Institutions and Inter-Firm Cooperation (2009). 

Reviews

[Trevor · Rating 5 out of 5]

Unfortunately, this is another book you are going to have to get your hands on. This is seriously interesting and probably ought to be read before Varoufakis’s Techno-Feudalism. The book provides a history of the internet and the financial system and shows how the US has used both to spy upon and control the rest of the world. One of the benefits the US received from the post-war settlement was to have the US dollar as the world’s currency. This is not a small benefit. The US is able to use it greatly to its advantage, enough to build an empire and, as all empires do, extract tributes from those forced to trade in the US marketplace.

The other aspect of all this is how the internet has developed. As we know, the internet was set up as a means to avoid the Soviet Union from stopping communication between key US military centres by targeting important nodes on the network. That is, the internet was designed to be a distributed network. However, as it developed into a commercial vehicle it became clear that certain nodes were more important than others and that these became increasingly so over time. This meant that virtually all internet traffic passed through certain high-speed nodes. This in turn meant that it became relatively easy for US intelligence agencies to tap into these nodes and spy on their own citizens and the rest of the world. Amusingly, the book repeatedly notes that US laws only apply to US citizens in the US – and so the rest of the world is fair game. This reminded me of the fact Julian Assange was terrified of being brought to trial in the US where he would be denied first amendment rights that would otherwise be available to him if he had been a US citizen.

We forget the debt we owe Snowden in informing us of the extent of US surveillance. But the authors here make it clear that this is just the tip of the iceberg. What is perhaps surprising is that much of the ability of the US to gain access to this information has not been a design feature of the internet, but an accident of its history. This has also been facilitated by the US being able to place pressure on various companies to supply it with the data it demands. Basically, everything the US accuses China of wanting to do, it has been doing ten times more and for decades. If information is power, then power corrupts absolutely. The problem is that the US has allowed that power to go to its head. And like a drunken dictator, the sheer level of capriciousness of the US is the thing likely to kill this particular golden goose.

If you are the holder of the international currency, you have something of an obligation to ensure that currency lives up to its Latin etymology – to flow. But today, with so much of the world under sanctions, flowing is exactly the opposite of what is occurring. This power by the US was first used against terrorist organisations and failed states such as North Korea and Iran. Iran is a particularly interesting test case, since the world had a perfectly serviceable agreement with it to ensure it would not build nuclear weapons and then Mr Art-of-the-Deal decided that he could negotiate a better deal than Obama had. The result was no deal at all – but when you are a petulant man-baby, destroying something is almost as much fun than fixing it – as we are about to find out again come November. The US applied financial screws to Iran, got its way, then told European banks they could go back to investing in the country. The problem was that the sheer capriciousness of the US meant none of the European banks were prepared to take that risk. They knew that a shift in US policy could immediately see them punished for doing what they were told.

And now the US is proposing expropriating Russian billions and handing them over to Ukraine as reparations. Regardless of what you think of Putin or the justice of Russia paying reparations for its illegal war, this would set a precedent that would make the world financial system difficult to sustain. Nations such as Saudi Arabia or China are hardly going to be delighted knowing that the US can take their foreign reserves more or less at whim. This means it is becoming increasingly urgent for them to build an alternative international monetary system not under the direct control of a nation that has no respect for international norms and sees itself as above the law.

But this book is about China and how the US is seeking to keep it in its place. The dangers of such a policy are spelt out in great detail. I’m not going to pretend, I’ve been terrified that we are inching our way ever closer to a nuclear war with China. A war we should otherwise be avoiding like the plague – although, given our recent experience with Covid, we should be avoiding it with more gusto than we did the plague. We now live in a world where negotiation is seen as capitulation and mutual respect is seen as weakness. In such a world, brinkmanship is seen as diplomacy. We need to relearn that you don’t negotiate with friends, there is no need for such negotiations, you only need to negotiate with those who do not start already agreeing with you. My only hope is that we relearn this lesson while there is still a world worth saving.

This book is about a difficult topic and it is written in the most accessible of styles. You really ought to read it. It could easily have been called A Series of Unintended Consequences. We need to regain control of our futures.

[Mai H. · Rating 3 out of 5]

I'm American. It's hard to be patriotic once you learn how far the empire spans. Empires don't need monarchies. This oligarchy is hard at work right now. Blame the government. Blame defense. Blame capitalism. Did I lose you? Multinational corps use their power to turn the tide in Washington.

🎧 Thank you to NetGalley and Macmillan Audio

[Wick Welker · Rating 4 out of 5]

Corporate-State Warfare.

This is a decent and brief read about how the US fell into near-accidental control of the alleged "decentralized" internet infrastructure and leveraged that monopoly into controlling and asserting global hegemony through international financial institutions like Swift. You'll get a very nice and needed update about the current cold technological war with China. China has done everything to try to create its own tech hegemony from creating its own digital currency to controlling silicon micro chip fabrication. Make no mistake: the current geopolitical stratagem rests on who can control access to micro processors and how tiny they can get them. TSMC, the world's largest in Taiwan has become a geopolitical lightning rod given its crazy history with China who thinks it still controls the island and the interdependency of the US. Trump and then Biden really escalated the warfare especially when Biden placed huge restrictions on China, an enormous firing shot and sign of what's to come with this conflict. No wonder that TSMC is building a chip factory in Arizona as I write this. This was a very good book to read if you want to know. Be warned: if China invades Taiwan, really really bad things could happen.

[Ericka Clou · Rating 5 out of 5]

Wow! I studied foreign policy in undergrad and this is a huge piece of the puzzle now that I didn't fully comprehend. Farrell and Newman basically explain how the internet's physical infrastructure has affected banking, security, technology, economics, and foreign policy in a way that has supported a US hegemony. This is one of those books that has completely changed the way I view the world.


Thank you to NetGalley and Macmillan Audio for an ARC in exchange for an honest review.

[Sebastian Gebski · Rating 3 out of 5]

I really wanted to love this one, but it didn't work out. In theory, everything is in place: the book is still up-to-date, and all the major topics have been covered (infrastructure, sanctions, the global financial system, cryptocurrencies, etc.), but the level of detail is faaar from satisfactory. I couldn't help the impression I read another high-level article from NYT, FP or The Economist, while I was craving for more.

Examples? Sure. Let's take the role of Swift in sanctions - there's barely any detail on existing alternatives, on particular challenges with building workarounds, etc. I was always left with more questions than I had initially. E.g.: why aren't the sanctions truly effective? how are they worked around typically? what are specific countermeasures that are or COULD BE applied? Even the final chapter on crypto was extremely shallow - the list of risks and challenges consisted only of the most basic ones, while the reality is far more complex (starting with the impact on fiscal policy, tax systems, legal regulations, risk assessment methods for financial instruments, etc.).

This issue was probably the most painful in the initial chapter - on the global infrastructure. Why so? The other ones are relatively well covered in existing sources, but this one isn't. That's why I had tons of questions: about the global chokepoints, about the feasibility of monitoring the throughput, about options to bypass/circumvent the restrictions (if any), about the impact of satellite Internet (if any), etc.

In the end - I'm disappointed. 2.6 stars rounded up to 3, just because I'm glad this important topic has been somehow addressed. But I expected the author to address it in a far more detailed manner.

[Nils · Rating 5 out of 5]

Building off their celebrated International Security article on “weaponized interdependence” Farrell and Newman now chart the rise of the US-center physical infrastructure of finance and telecommunications. Largely build by accident, this was eventually ideologized as a pathway to a Hayekian dreamworld of borderless free flowing money and information outside government control.

This turned out not to be what happened. After 9/11 the US realized that its control over the physical infrastructure of financial and telecommunications was a tool that could be used to chase down enemies, and since then it has increasingly used this control as leverage to squeeze not just criminals but state actors like Iran and Russia and China. This in turn has provoked a backlash, as states have sought to build their own hemispheric stacks that will insulate them from the infrastructural power of the United States. “The United States had made itself too powerful to be trusted.” (76)

F&N lament this not just because of the loss of the cosmopolitan dream of global integration under the sign of doux commerce but also because it shows how US promiscuity in using these tools is undermining the effectiveness of the tools. “Exactly because they seemed so effective, policymakers might be tempted to turn to them as a first step when facing a new crisis. This might not just make them less effective over time. It could potentially undermine US dominance of the world economy.” (77) Instead they propose that the US develop a “commonwealth” approach, which seems like it’s mainly a less unilateralist way of using these tools, directed at pushing goals like decarbonization and AML.

[Andrew Ferguson · Rating 3 out of 5]

An interesting book and a good introduction to the concept of soft power projection through systems like international banking regulation and internet service provision. However, the vagueness and almost ahistorality of some of the commentary stops it from ranking higher in my estimation. A good example of this is the history of telecommunications and the primacy the US was able to achieve. The fact that organizations like Bell Labs weren't mentioned at all is shocking.

This book was clearly written for policymakers and the DC set, and it shows. The book draws the dividing line for the start of this "underground empire" at September 11th, and paints the origins of the networks of soft power as developed ad hoc and essentially by accident. But these systems of control existed as relics of the Cold War, and were brought back into use by Cold Warriors looking for relevancy. Towards the end, the book descends into borderline Sinophobia and great power politics a la Meirsheimer rather than showing how these tools of control are double edged swords that hurt individuals. A book that focuses on how the development and deployment of this “underground empire” inadvertently led to the unstable world we find ourselves in today would make for a much more profound book than what is presented. I would love to have seen a critical analysis of the concept of power politics as opposed to the doubling down on a "Commonwealth" style solution the authors present in the concluding chapter. As it stands, "Underground Empire" is an opening act at best.

[Eoghan O'Brien · Rating 2 out of 5]

Just 2 stars from me despite the good reviews elsewhere. The book had a promising start - introducing how choke points in networks can emerge organically, but ultimately can be weaponised to exert and consolidate power and influence.

Unfortunately the remainder felt like an erratic introduction of related stories - ranging from the hyper specific to passing references without context.

Maybe it's more a reflection of my ignorance on geo-politics but this book never really pulled me in.

[Olan McEvoy · Rating 4 out of 5]

Excellent little book on how the United States’ centrality in global finance, information & communications networks, and cutting-edge tech production has led to its control of an “underground empire” which it has subsequently weaponised to punish adversaries through sanctions, coercion, and spying. While after the cold war globalisation seemed to promise a world of borderless financial transactions, trade, and communication, since 9/11 American administrations have wielded their economic power freely to isolate states such as Iran, North Korea, and Russia from the global economy.

The issue is that this power becomes less effective the more it’s used. The turn towards using sanctions to try to stop the rise of China, with the collapse of Huawei’s global telecommunications market share being the biggest outcome of this so far, has the potential to undermine the United States’ central position. Fewer and fewer states view the US as an impartial steward of global networks, making the possibility of switching to a geopolitical rival’s network less daunting. These networks are mostly not developed enough yet though, so de-globalisation is largely still on paper. But now we’ll have four years to see if it could happen.

The authors try to end on a note of optimism about reforming America’s underground empire, but unfortunately this chapter reads as a relic of a bygone Democratic administration era. Now under Trump 2, the potential for misuse of sanctions has never been greater. I’ll be keenly following the authors’ writing on the new administration over the coming years.

[Adam · Rating 2 out of 5]

This was a thoroughly disappointing book.

The conceit, that the United States, as global hegemon, has bolstered its economic and political position through the control of the infrastructure of the internet and modern international finance (e.g., Swift) is well discussed elsewhere, though the simple consolidation of these arguments into an accessible book such as this should be a worthwhile exercise.

Instead, this text envelops a discussion on the realities and obvious dangers of USian hegemony over the core structures of the international political and economic system with the ideological puritanism of any Washington hack. The notion that the internet was developed under the direction (direct or otherwise, e.g, through the funding of projects such as the original World Wide Web and latterly Signal or TOR) of the United States military and intelligence apparatus is scoffed at; not even countenanced - the domain of conspiracists. Instead, the internet is framed as the child of entrepreneurialism, bolstered fortunately by the collapse of the Soviet Union, through which various arms of the state took advantage in their own self-interest. The Obama administration - that under which Germany and other US allies discovered the depth of NSA surveillance of their affairs - is framed as trying to wind back the nefarious use of US hegemony on the internet only for Trump and his cronies to muck it all up. Simply put, this is fantasy. Other texts, such as Levine's Surveillance Valley, do a much better job of explaining why and how the United States has ended up with such control over this vital web of international infrastructure.

On finance, there are similar flaws, though it does a much better job of explaining how unilateral US control over mechanisms such as Swift impacts third-party nations. However, there is still a lack of insight into the depths of the impacts of this control, nor the deep ideological underpinnings that propel the US urge to dominate these systems. It describes the weaponisation of US dollar hegemony as something relatively new, for example - Bretton Woods and the Plaza Accords are never mentioned in the book to my recollection, which is really strange.

To go a little deeper on what I'm trying to say, take the Cuba example (mentioned obliquely once or twice in the book). *Every* nation bar the US, Israel and Ukraine voted in favour of ending the United States sanctions regime against the island nation at the UN in November of 2023. 187 nations to 3. There is no international support whatsoever for this regime of unilateral coercive measures described by the United States as intending to deny "money and supplies to Cuba, to decrease monetary and real wages, to bring about hunger, desperation and overthrow of government".

The sanctions regime on Cuba, the longest-running in the history of humankind, denies access to Swift and other financial mechanisms for Cubans, United States citizens and, through the hegemonic processes outlined in the book, citizens of the rest of the world. The inability of, for example, New Zealanders, to send money to friends in Cuba other than via shady third parties or by carrying cash to the island itself means that Cubans go without, aid cannot be delivered, medicines cannot be received.

*This has no international legitimacy* (critique sanctions on other "terror states", as I would, all you like, but at least they are reciprocated internationally to a degree), and yet is leading to premature deaths and disease and forestalling Cuban development (to the tune of $144 billion of lost GDP as of 2020).

The sense I get, though, is this example is too illustrative of the violent and genocidal intent of the United States empire, rather than the consequence of a series of mistakes made by bad actors in bad faith; the perspective the book appears to much prefer.

To end - and perhaps this is all I need to say - I think it's most telling that the subtitle of the book is "How America Weaponised the World Economy", as if this isn't something that has been done since the advent of the capitalist world-system. To my mind, it is much more valuable to consider the modern "weaponisation" of global trade, finance and information flows by the United States as the further heightening of a process of imperialism a couple of centuries long. It is not bad actors that have weaponised the suffering of the world, it is an irredeemable system led by an irredeemable colonial project. There are good examples and case studies in here, but little else to write home about.

[Rajiv Chopra · Rating 5 out of 5]

I have been reading about the way America uses sanctions and other means to browbeat other countries. I wasn't aware that the US government bullies businesses to align with its security and geopolitical interests.
This book is a simple demonstration of the silent battle that takes place underground, far from the public eye. A complex web of activities seethes below the surface, forcing countries and corporations to comply with a malevolent empire.
The authors did not delve deep into the possible repercussions of this behaviour. Will the trade and technology wars become real wars?

[Literatures Movies · Rating 5 out of 5]

Such a good book. It really connects all the dots from all the news I have been consuming the past few years. This books paints a general view of just how deep the US’s reach is, which I am sure is probably more far reaching than I realize.

I find some parts in the middle a bit slow, but the last few chapters flew by! Dense but really good reading for those who want to learn a bit more of what is behind the curtains.


Blog: http://literaturesandmovies.com/

[Khan · Rating 4 out of 5]

A surprisingly interesting read, I picked this up because all the books I wanted to read are still on hold. However, I did not regret giving this book a shot. This book is about how America weaponizes the global economic system to strengthen its geopolitical goals, forcing weaker countries into either accepting or rejecting economic partnerships and blocking influence from rival powers in various parts of the globe to maintain it's global hegemony . It can be looked at as a way where superpower states can draw up geopolitical lines through a number of financial and technological instruments to maintain and expand its power throughout the globe.

As we move from a unipolar world with the US being the only superpower to a multipolar world with other countries becoming a super power like China and possibly India in the coming decades, these battles will become more intense, they will cause many countries and corporations to make a choice of who's side to pick but most importantly the threat of war is also increased as superpowers use proxy battles with one another through various forms to block one another from gaining a perceived strategic edge. These proxy battles can take many forms such as war through smaller countries, spying, economic and technological sanctions and spying by using backdoors in software.


After 9/11 the US uses this event to be able to gain access to global financial records to monitor transactions from supposed terrorists. This power is quickly expanded to look at transactions through states and corporations to monitor rival countries growing dominance. Through multiple tactics by threatening commercial and international banks abroad, the US is able to extend its geopolitical power by threatening to block them from the U.S economy which is a death sentence for countries and corporations alike.

This brings us to the second form of superpower dominance. Technology. The US has engineered a global surveillance mechanism where it steals the data of American corporations that are here and abroad. Which gives it the ability to look at private messages between anyone. This is revealed in the Snowden links which alarms many countries. China in particular, starts its 5G network through state backed corporation called Huawei. Which makes cellphones and is building 5g networks across the globe. This alarms the US security state because it knows that data used through the network and the phones can be routed back to China. As a result the US moves to employ sanctions on using Huawei, in an effort to block Europe from using this 5g network and blocking phone sales in America. This causes a chain reaction of numerous American and European companies who might rely on this cheap technology from China. Which then leads us into perhaps the most important battle which is the battle for semi-conductor chips, the new oil to the economy.

The semi-conductor chips battle has been well documented, semi-conductor chips are used in almost any technology from fridges to cars to missiles. The US recognizes this and moves to block chips from being sold to China as a way to curb their growing geopolitical dominance. This creates an issue with corporations who have partnerships with China that are caught in the middle of a proxy war between two heavy weights. The US throws billions at the chip manufacturing issue, a technology that once was founded by Americans, which manufacturing capability was quickly exported out in the 1980's has come to haunt the US today.

Where does this lead us today? When Russia invaded Ukraine, the US acted aggressively imploring sanctions throughout the globe on everything Russia related. As a result it lead to an immediate and sustained rise in energy prices, food prices and a number of other industries that started an inflationary death spiral for the globe. The truth is that policy makers in the US really don't understand how these sanctions are going to come back to bite them in the ass. It can be incredibly hard to predict how these sanctions will impact other parts of the economic supply chain. These sanctions along with many other failed geopolitical policies most likely caused the Biden administration to lose the 2024 election.

Something that is not talked about is how the sweeping sanctions of the US had also further impacted the crisis in Eastern Europe. Energy prices soared, specific Russian metals were banned from the global supply chain, it was a disaster for many across the globe. Russia also used its gas pipeline to wage economic warfare on Europe who stupidly relied on cheap gas. The author states that the US is still the dominant power which I agree with but those sanctions lead to a further strengthening of BRICS. Russia's economy was able to survive forging partnerships with China, Iran and Saudi Arabia. The US power is fading as we move to a multipolar world where it cannot flex its power in ways it used too. Countries have other alternatives. As the US denigrates its standing across the world for its unconditional support for multiple disastrous wars, it loses it political standing with the world making its rivals more appealing. As Trump wants to take over the Panama canal, Greenland and fictitiously Canada (Trump annexing Canada making it easier to date Canadian women? Finally, at least one U.S foreign policy I can get behind). China responds with "China respects the sovereignty of other countries".

I think its important to note how America sees itself is not how the world sees it. Blocking peace deals in Ukraine, unconditionally giving weapons to Israel which is an apartheid state. Completely rips the mask off of the image the US likes to maintain as "Upholding international law and supporting human rights through out the globe. Spreading peace, freedom and liberty".


I usually try to stay away from books that are short reads which try to explain complex topics for obvious reasons. I think this book was entertaining, its somewhere between a really good article and a really good book. Its better than an article but not good enough to be labeled as a really good book. Its premise locks you in but the depth of the discussion does not go far enough to cement its status as a must-read. I think it was a missed opportunity by the authors. The book is 213 pages, on page 200 BRICS is mentioned. I have this between a 3-3.5ish so I bumped it to 4 but it could easily be a 3. I hope this helps.

[Rodger Payne · Rating 5 out of 5]

This is an excellent and important book, particularly timely given the prospect of a second Trump presidency. Farrell and Newman demonstrate with plenty of evidence that the US has taken advantage of various centralized chokepoints in the world economy in order to leverage preferred solutions on global policy topics. They note that an enormous amount of internet traffic passes through various communications hubs and servers that are physically located inside the US. Despite the popular notion that the internet is a complex web of connections, it is quite centralized. Post-9/11 legislation, including the PATRIOT act, created opportunities for surveillance of that internet traffic – or opportunity for the NSA to steal the data of non-Americans, who are not protected by the US constitution. They mention a variety of US government programs revealed by the Snowden leaks that highlight the incredible information wealth vulnerable to US access. This is more than a hypothetical situation as NSA has clearly kept and exploited this data.

Farrell and Newman also discuss the development of the dollar-clearing mechanism known as SWIFT, which has made it possible to target essentially anyone who needs to make transactions with US banks at some point (virtually anyone using the dollar). One of their case studies illustrates how the US used this mechanism to coerce Iran into the JCPOA nonproliferation deal. The Treasury Department’s Office of Foreign Assets Control (OFAC) has the power to freeze assets unilaterally and “designate” foreign actors to be cut off from the US economy. It is a potent weapon and has been used against even individuals (such as Russian oligarchs and crypto-criminals). US control of intellectual property related to semi-conductors created a chokepoint to fight the trade war with China – and pressure a Taiwan company to build a new plant in Arizona. A variety of measures enabled intense sanctions against Russia in response to its invasion of Ukraine. Huawei’s 5G network was largely defeated by a multi-year campaign to pressure other states not to adopt its technology and preventing it from using any American IP.

While all these uses may sound promising for US foreign policy, Farrell and Newman additionally document the problematic aspects of this US power. European citizens have experienced enormous violations of their privacy and the EU court system has not been able to protect them despite its rulings about rights. Microsoft and Google have felt their autonomy violated and responded with digital encryption. The Trump administration designated legal officials affiliated with the ICC simply because they were investigating US soldiers for alleged war crimes. Indeed, allies have increasingly been coerced to follow US unilateral decisions in the form of secondary sanctions with real teeth. This is a threat to genuine multilateralism and “commonwealth.”

Some states have responded to US pressure by moving away from the interdependent economy. The sanctions against Russia created energy shortfalls in Europe and prices soared, angering consumers. When the US and others tried to respond with a cap on the price of Russian energy, the Saudis responded by steering OPEC to production cuts to increase prices. After the JCPOA negotiations, Iran developed an alternative system that sounds a lot like money laundering. China and others have sought to develop alternative payment schemes now worth $80 billion. Supply chains have been further endangered as China has looked for its own chokepoints (and likely has some in terms of rare earth minerals, photovoltaic cells, and other green energy technologies). Farrell and Newman note that already mounting tensions with China could get much worse going forward if the US continues to leverage its economic power as it did against Huawei. Indeed, the authors fear some kind of economic Cuban Missile Crisis that could provoke tensions and potentially even war. They argue briefly that the German and Japanese response to economic coercion between the world wars was partly responsible for their aggression.

The strength of the book is the diverse array of stories the authors tell that convey their main points about economic centralization and choke points favoring the US. They clearly demonstrate the existence and use of these choke points, mostly leveraged by the US for its own security interests.

While the writing is not academic, it is clearly informed by their scholarship and is obviously aimed at a broad but relatively elite audience. It is rigorous and readable. The authors often quote academics and the research those academics produce in a manner like the way journalists directly quote sources. Some of the stories are obviously built on interviews as well.

The book is of much practical value. It most clearly warns about a security problem that is rarely discussed openly in world politics. Should US security policymakers be able to wield this kind of unilateral and fairly secretive source of economic power? Many scholars in the field likely have not given it much thought though I am now confident that high-level economic officials and other affected leaders in many nation-states have.

The final chapter of the book outlines the need to develop a strategy to manage risks in a manner comparable to the way that Cold War risks were managed through increased engagement between the Soviet Union and West. First, however, the US needs to create a much deeper pool of experts who can think systematically and strategically about weaponized interdependence. They note how important Thomas Schelling and other strategists were during the Cold War. The current moment requires IR scholars, experts on financial networks and supply chains, information science specialists, historians, and others to create a language, literature, pool of knowledge, and even a bureaucracy to develop meaningful strategies. The US needs an economic security agency. Allies and adversaries alike need to be included in some kind of global forum amenable to meaningful conversations as everyone needs to learn the risks and management techniques, which might include formal treaties. This likely cannot be the WTO since its free trade assumptions have been blown out of the water by weaponized interdependence.

Finally, Farrell and Newman also speculate that the tools in place could be employed for desirable ends. They specifically mention fighting climate change and note the potential powerful enforcement of green tariffs. The EU has already been pursuing such tariffs and the US has agreed to them under the Biden administration (Chinese Electric Vehicles). They also talk about addressing corruption (recently identified as a security priority) and tax evasion.

The specific-yet-broad policy recommendations they make seem perfectly reasonable given the context. This is a moment to create new ideas about managing the risks of abuse of power. Frankly, private foundations with global links should probably step up to fund some of this.

The ideas they mention about using the power to solve shared global problems like climate change and corruption are interesting but would presumably need to be worked out among policymakers from many states. Such actions could supercharge the Paris climate agreement, potentially, but would likely also be vulnerable to US elections given how Republicans have responded to past international negotiations on this topic. Trump withdrew from Paris once already and George W. Bush called Kyoto “fatally flawed.” Meanwhile the potential for abuse of this power continues to loom.

[Jonas Heering · Rating 5 out of 5]

Underground Empire tells a compelling story of how the United States has inadvertently turned global economic networks into a geopolitical tool. The book does a great job at translating academic research into a capturing narrative for a general audience. A must read for anyone who wants to understand the geopolitical implications of technology and finance without having to have any technical background.

[Jaqui Lane · Rating 5 out of 5]

I've been following henry Farrell on Substack for a while now and I highly recommend you do too.
So when I heard about this book I had to get it.
Everyone is now talking about how data centres are the infrastructure of the 'new world AI order'.
That they may be, but it's the buried fibre optic cable networks that feed our connected world that is where the real power lies.
And, Farrell explores how all roads lead to the US...a current-life play on the phrase 'all roads lead to Rome'.
If you want to explore just how this works read this book.
It unmasks how the US dominates the flow of data and information across the global financial system, manufacturing systems, data systems.
We might all be distracted about AI and data, data centres and the Magnificent 7, BUT the real power is what you can't see.
A great book....read it if you dare.

[Hal Triedman · Rating 4 out of 5]

a quick tour of the cabinet of curios that is modern financial systems of control ends up being an explainer of international realpolitik and the new global paradigm of "networked coercion" in finance, technology, trade, supply chains, and more.

newman and farrell provide a solid explanation of the nuts and bolts but frustratingly pull their punches in critiquing american imperialism (and the would-be imperialisms of other countries). to that end, reading this book at times felt a little like watching one of those monster vs monster movies (godzilla vs king kong and the like) — narrative wonder at the scale and beauty of the destructive forces that great powers can wield against each other without a decent reckoning of its true costs.

[Edwin Goh Wei Qian · Rating 5 out of 5]

Underground Empire is a must-read for everyone to know about the growing weaponised world of interdependence. It explains how unplanned decisions led the US to build its underground system in areas like technology, currency, and manufacturing. While the saying 'big power, big responsibility' holds, the people behind this underground empire don't fully grasp the impact on global supply chains and the consequences. I started the book to seek hopes for solutions to strained relationships between today's dominant powers, but unfortunately, it left me more worried about a world with an even more weaponised world economy.

[Mohammed Ilyas · Rating 4 out of 5]

This is a useful book to read to understand the infrastructure of how the U.S. Empire functions. Key technologies that impacted Globalization include:
1. Containerization
2. Certificate of Deposit
3. Eurodollars
4. Dollar Clearing System and CHIPS
5. Automated Settlement System (MARTI and SWIFT)
6. Internet
7. Semiconductors

While reading this book, I found this infograph on the US Dollar System: https://www.reddit.com/r/Infographics...

One star off as the authors seem to describe the U.S. Empire as something that happened by accident.

Will keep revisiting this book from time to time.

[Harshan Ramadass · Rating 4 out of 5]

The power of the US govt runs deep and wide. It’s a minor miracle that it has been the leader of the democratic world, yes, it abused its power post 9-11, but on balance one could still argue that it’s the least bad actor in a multipolar world. What I worry though is, say Trump or a Trump clone emerges next as the prez and has little consideration for democratic guardrails. All this hidden power could come to bear, to harass citizens all over the world?

[Rob · Rating 4 out of 5]

This is one of those books that deals with weaponised interdependency - a term these authors have been employing for at least half a decade now. It deals with the ways in which financial markets, the technology that power them, and the national polices that inform them have helped to sustain a second Cold War peace of sorts. But, like Chris Miller’s “Chip War” book and Ed Conway’s “Material World” book, you can’t help but fear for a future in which Taiwan becomes a contested state. The authors seem to discredit the Chinese central bank’s e-CNY which may be valid, but it does seem like this crypto currency may be crucial for China and its ability to escape the grip of the $

[Paloma Delgado · Rating 4 out of 5]

Great read about U.S. domination of the world economy through the power of the dollar, economic sanctions and access to information. Extremely well done and researched. Farrell and Newman do a great job of weaving together the intricacies of data/data privacy laws, the narrow (and deeply choked) world of U.S. telecommunications, how the U.S. “protects” its national security interests (pressuring other countries to act in certain ways), and how the country controls global access — whether to new markets, assets or overall influence.

[Matt Steinberg · Rating 5 out of 5]

such an eye opening book to how power actually materially exists in the modern world.

like, here's a crazy stat! By the early 2000s, 99% of the information digitally passing between any two regions in the world passed through the U.S. We are at the center of every email sent, financial transaction made, legal loophole exploited, fiber optic cables laid... And we very intentionally designed the the global infrastructure this way. It's a critical reason America can strong-arm any adversary at a whim.

Also a great book for shutting down the “I don’t care if they see my search history, I have nothing to hide” crowd. This makes crystal clear why data privacy isn’t just personal, it’s geopolitical. If the 20th century was a global tug-of-war over oil and land, the 21st is about data, and America’s grip on privacy infrastructure is the foundation of its modern empire.

[Ben · Rating 4 out of 5]

Short little vibe. Good intro to a few different things happening behind the scenes. The ending part about climate change felt a little silly but overall good

[reemp · Rating 4 out of 5]

The subject matter is interesting, and it is clearly laid out. My qualm is that I think it could have been more concise, and parts felt a repetitive.

[Thomas · Rating 3 out of 5]

Sehr interessantes Buch darüber, wie die USA existierende Strukturen, die den freien Handel fördern sollen, für ihre politischen Zwecke verwendet haben.

[Stefan · Rating 4 out of 5]

Very good. Definitely recommended.

[Ariqa Herrera · Rating 4 out of 5]

Excellent overview of the ways in which the US has both stumbled upon and purposefully consolidated power in the so-called underground networks like telecommunications, banking systems, supply chains, etc. and how it has leveraged its hegemony to create choke points along those networks.

It does an excellent job looking at the fragmenting of globalization especially between US partners and allies that began under the Trump administration and continued in a different way under the Biden administration. It offers a cautionary tale of how further fragmentation under a second Trump administration could heat tensions (not necessarily leading to a war) across the globe especially with China.

I think the authors assume the reader comes in with a fair amount of background knowledge that if you don't have could take some time to contextualize. It is dry in certain areas which can be expected in a non-fiction book. Some of the prescriptions offered unfortunately are unlikely to come to fruition any time soon, particularly an Economic Security administration that would develop a grand economic security strategy.

[Preetam Chatterjee · Rating 5 out of 5]

#Binge Reviewing my previous Reads # World Politics & International Relations

Farrell and Newman’s *Underground Empire* is not a book about warships or coups or flags being raised over conquered capitals; it is a book about the silent, humming architecture of the world economy and how, without a grand plan but with increasing deliberation, the United States has turned that architecture into a system of power. Reading it feels like following a pair of political archaeologists as they descend into tunnels beneath the official city of geopolitics and show you the cables, servers, compliance offices, and legal choke points that actually determine who can move money, communicate, trade, or innovate.

The title’s metaphor works: this is an empire that is not visible at parades but embedded in the subterranean plumbing of globalization. Farrell and Newman build their story around the concept of “Weaponized interdependence,” the idea that the very networks designed to link the world together can, because they pass through certain nodal points, be used coercively by the state that controls those nodes. The book traces how the U.S. came to sit at the centre of many of these networks—financial clearing systems like SWIFT, dollar-denominated trade, undersea cables, global intellectual property regimes—and how, especially since 9/11, Washington has begun to see those nodes not simply as utilities but as weapons.

The authors do not write like technocrats. Their prose has a patient, unmasking rhythm, mixing case studies of Huawei, Iranian sanctions, and global export-controls with sketches of the individuals inside Treasury or Justice who figured out how to translate abstract dominance into practical leverage. They show how sanctions went from a blunt instrument to a precision tool, how export controls on semiconductors can now strangle an entire supply chain, how surveillance built for counter-terrorism can also map corporate or scientific flows. In this sense, the book sits alongside works like Anne Applebaum’s *Autocracy, Inc.* but with a crucial difference: Applebaum’s villains are a club of dictators copying each other’s tactics, whereas Farrell and Newman’s protagonist is a democracy that has become, almost inadvertently, imperial in its infrastructural reach. The effect is less moralistic than diagnostic. They do not pretend that the U.S. invented global interdependence for sinister ends; instead they show how commercial, legal, and technological evolution produced choke points and how security logics rushed in to occupy them.

What makes the book feel contemporary and not just another entry in the declinist-or-triumphalist debate about American power is its post-Cold War sensibility. Farrell and Newman refuse old binaries of free world versus closed world. Power is not a clash of blocs but a system of rhizomes and hubs, and the U.S., sitting at many of the hubs, can reroute flows, exclude adversaries, or compel cooperation. A Russian bank transacts in dollars and can therefore be frozen; a Chinese firm depends on U.S. software or semiconductor designs and can therefore be cut off. This is empire as platform, not palace. It echoes Foucault’s vision of power as network rather than pyramid, Deleuze’s sense of control societies rather than disciplinary enclosures. The authors do not cite those theorists, but their narrative performs the same move: what matters is not territory but leverage points within flows.

This framing gives the reader a new way to interpret familiar headlines. When the U.S. pressured allies to drop Huawei from their 5G networks, that was not just a trade dispute but a battle over who controls the future’s choke points. When sanctions cascade across Iran or Russia, it is not simply an expression of moral disapproval but an exploitation of infrastructural dominance. Even the drama over TikTok in the U.S. can be read through this lens: a contest over data pathways, compliance regimes, and the possibility of weaponization. The book leaves you seeing these patterns everywhere, as if the wallpaper of globalisation has suddenly turned inside out to reveal the wiring.

Yet *Underground Empire* is not an uncritical celebration of U.S. power. Farrell and Newman worry, repeatedly, about overuse. An empire built of networks is subtler than one built of bases, but it may also be more fragile. Every time Washington squeezes a rival through financial sanctions or export bans, it gives that rival an incentive to build alternative networks. China’s push for cross-border payment systems, Russia’s experiments with bypassing SWIFT, Europe’s hesitant steps toward “strategic autonomy,” the rising talk of digital sovereignty and data localisation—all of these can be seen as attempts to tunnel out of the underground empire. The authors suggest that if the U.S. treats its infrastructural dominance as a limitless resource, it risks accelerating a world of splintered internets, balkanised finance, and reduced leverage.

This tension—the effectiveness of the tools versus the danger of backlash—runs throughout the book. Sometimes Farrell and Newman seem almost awed by how much can be done without firing a shot: how a dollar-clearing regulation in New York can freeze a transaction in Dubai, how an export-control list can derail a Chinese tech champion. Other times they sound anxious, aware that coercion without legitimacy erodes alliances and norms. They are also attuned to the moral and political ironies. For decades, the U.S. championed a liberal, rules-based order. Now it is the primary practitioner of targeted, extra-territorial, compliance-based power. The line between upholding security and pursuing narrow interests blurs. This ambiguity is one of the book’s strengths; it invites the reader to grapple with the dilemmas rather than offering easy prescriptions.

The comparison with Applebaum’s *Autocracy, Inc.* throws this into sharper relief. Applebaum describes how authoritarians launder each other’s methods—propaganda, surveillance, elite capture—across borders. Farrell and Newman show how a democracy can, through control of infrastructure, become an empire of enforcement. One book is about the circulation of illiberal practices; the other is about the centrality of liberal networks. Together they tell a more complete story: the global order is not a chessboard of regimes but an overlapping set of systems—financial, technological, informational—whose nodes can be captured or manipulated by very different actors. Reading them in tandem underscores how fragile the idea of a neutral, open global system really is.

For all its clarity, *Underground Empire* also provokes questions it does not fully answer. How durable is U.S. dominance at these nodes? What happens when domestic politics in the U.S. itself become more polarised or populist? Can a country wield such tools without undermining the very openness and predictability that made others trust its networks? The authors sketch some possibilities—multilateral rules, greater transparency, self-restraint—but their tone is more warning than roadmap. In this sense the book shares the mood of much contemporary IR writing: the sense that we are entering a phase of fragmented power, new contestations, and the erosion of once-taken-for-granted infrastructures.

As a piece of writing, the book succeeds by making the abstract concrete. Farrell and Newman’s case studies are vivid, their explanations lucid. They are at home in both the technical details of export controls and the big-picture questions of global order. There are moments when the prose verges on the journalistic, moments when it feels like a seminar. But the overall effect is a patient unfolding of a paradigm shift: from thinking about power in terms of “hard” versus “soft” to thinking about power in terms of “structural” versus “networked.” For students, policy-makers, or citizens trying to make sense of headlines about sanctions, supply chains, or data sovereignty, the book offers a vocabulary and a map.

It also has a subterranean ethical charge. By turning the hidden levers of globalisation into weapons, the U.S. risks normalising a form of power that others—less constrained by democratic norms—can imitate. Already China is building its own standards regimes, Belt and Road digital infrastructure, and surveillance exports. Already Russia experiments with disinformation and financial disruption. In such a world, the difference between liberal and illiberal powers may blur further. The empire of networks may become an empire of everyone against everyone, a Hobbesian tangle of cables and contracts. Farrell and Newman hint at this dystopia without dwelling on it, but it lingers behind their analysis.

If there is a weakness in the book, it is not that it exaggerates U.S. power—though some critics argue that—but that it sometimes underplays the agency of others. Sanctions can be evaded. Parallel networks can be built. Compliance regimes can be gamed. The empire’s subterranean nature may make it effective but also brittle. Yet even these criticisms confirm the book’s importance: it sets the terms of debate. Whether one agrees with every claim, it is now hard to discuss global political economy without thinking about weaponized interdependence.

What emerges from *Underground Empire* is not a neat story of good or evil but a picture of a world where power is embedded in the mundane: in who writes the standards for 5G, who hosts the clearinghouses for dollars, who can subpoena a bank’s records, who owns the switches at an undersea cable landing. This is the true terrain of twenty-first-century geopolitics. Farrell and Newman have given us a way to see it. The book is long enough and detailed enough to change how you read the news, yet written in an accessible style that keeps you turning the pages.

By the time you finish, you understand why they chose the word “empire.” Not because the U.S. has colonies in the old sense, but because it has the power to shape the choices of others without occupying them, to impose costs and confer benefits through systems everyone depends on. And you understand why they chose “underground.” Because like the pipes under a city, these systems are invisible until they break or until someone points to the blueprints. Farrell and Newman have drawn those blueprints, and in doing so have illuminated a form of power that will shape the coming decades.

In a literary sense, this is also a book about revelation. It takes something we assumed was neutral—the infrastructure of globalisation—and reveals it as a terrain of struggle. In that way, it resonates with the best of postmodern social analysis: showing that what appears natural or inevitable is in fact constructed and therefore contestable. It is not quite Foucault at Langley, but it carries the same intellectual jolt. You close the book with a sense of disorientation and urgency, aware that the ground under your feet is not solid but a lattice of pipes owned by someone else.

For readers of Applebaum, of Joseph Nye, of Thomas Piketty, of Mariana Mazzucato, of John Mearsheimer, *Underground Empire* will feel like a missing piece of the puzzle. It bridges international relations and political economy, security studies and tech policy, normative questions and empirical detail. Its style is not bombastic but confident, its argument not ideological but structural. It does not tell you what to think about every sanction or export control, but it gives you the frame to think. And that is the mark of a book that will last.

Ultimately, Farrell and Newman have written a guide to the hidden levers of the contemporary order. It is both a warning and a map. It shows how America’s quiet infrastructural power can shape the world, and how that power, if overused or left unexamined, can undermine the very order it sustains. It does not offer comfort, but it does offer clarity, and in a time of fragmented narratives that clarity is itself a form of power.

Give it a go. Most recommended.

[Dan Callaghan · Rating 5 out of 5]

I was very impressed with this book.
Standards of journalism nowadays are, obviously, utterly dire, and this book really enhanced my understanding of the global system and the way that it actually works. This book discusses the exercise of power by the United States. How, the authors ask, does the United States manage to wield coercive power within a global economy which is seemingly so decentralised and in which political actors apparently have so much freedom of choice in terms of location?

The answer, in effect, is that power is applied at what the authors term “choke points” - physical or virtual spaces at which information, money, data etc. is centralised, before being dissipated to its intended recipient. For example, we might be talking about a physical hub where Amazon Web Services servers are located, or the headquarters of the SWIFT payment system. The US exercises power by applying surveillance and blocking techniques at these choke points. Here is a brief summary of the book’s main points:

- US financial power is underpinned by the use of USD as world currency, which is also used as the currency of choice in oil transactions
- If you want to do transfer USD from, say, your UK NatWest account to a UK Barclays account, what is actually happening is that NatWest and Barclays both have clearing accounts with US banks that actually transfer the dollars between themselves. The amount you are transferring in the UK (essentially eurodollars) is just fictitious money invented by the banks to cover the transfers that have occurred in the US between their clearing accounts.
- The US can prevent businesses, banks and even whole countries from holding clearing accounts and can therefore prevent them from using USD. This means they, in effect, can’t do a lot of international business.
- Internet traffic is routed through chokepoints in the US - that is to say, routers, servers etc. The US NSA (National Security Agency) can siphon off all internet traffic transiting through these hubs and parse it for intelligence.
- SWIFT is the global financial transaction standard and it’s based in Belgium. However it has data centres in the US which means it has to comply with US measures on sanctions and data exchange. Ie. The US can see who is transferring money and can cut foreign businesses, banks etc. out of SWIFT. This can prevent these organisations from acting in any cross border capacity. US banks and representatives thereof are also on the board of SWIFT and can be individually targeted/sanctioned by the US government if SWIFT doesn’t comply with my their demands.
- The US is allowed to block the export of goods from its shores to foreign companies if those goods contain 25%+ of US intellectual property. It can also block the export of goods to companies that might sell on those goods to third party companies of which the US disapproves, and the same 25% rule applies. Therefore, when the US wanted to block huawei from buying semiconductors from Taiwan, it effectively offered the Taiwanese semiconductor company (TSMC) a choice - either stop selling to huawei, or else the US will stop exporting to Taiwan the tools needed to manufacture any of their semiconductors.
- China cannot respond in like manner because it doesn’t control choke points in the world economy. It can restrict foreign countries from access to its domestic market, but this often harms China because it needs the imports. Thus when China restricted Australian imports, it didn’t restrict the biggest import (iron ore) because China needed it.
- US can impose secondary sanctions - Ie sanctions on firms doing business with countries it doesn’t like, even if those firms are located in its territory or those of its allies. Thus, the US blocked European firms from trading with Iran, despite the fact that they were doing so under the provisions of an agreement that the US, Iran and the EU had signed.
- As a result of US exercise of these powers, large Businesses cannot just do business with everyone - they basically have to steer a course between competing power blocs. Some, like TSNC (Taiwan) stay neutral, others like Microsoft throw their lot in with one government or other. Some, like cryptocurrencies, try and structure their affairs so that they are immune to sanctions. But it’s all a bit tricky, basically.

I would highly recommend this book to anyone who is interested in how power is actually exercised in the global economy today. It also reveals how power brokers in third countries may hope to blunt American influence - by constructing a different global network with neutral chokepoints, or chokepoints on their own territories.