New forces born in Iraqi invasion

Looking back to Nov. 9, 1989, we now know that the breaching of the Berlin Wall was an important turning point. It marked the beginning of the end of the artificial division of Europe, the end of the Cold War and the start of a new era in world affairs.

Aug. 2, 1990, the day Saddam Hussein invaded Kuwait, may turn out to be another historic watershed. I think the consequences of the invasion could be far-reaching in at least three crucial areas.

Energy policy: We will spend $2.5 billion by Sept. 30 on our Middle East military intervention, undertaken, in part, to secure our oil supplies. That's a huge subsidy for Persian Gulf oil, and the price is going up.

With half our oil supplies coming from imports, we are, as Fortune magazine reminds us, "overly dependent on a fuel pump in a high crime neighborhood."

We must reduce our reliance on imported oil, develop alternative fuel sources and use energy prices and other incentives to promote conservation. That's our best hope for escaping the economic and political turbulence that comes with doing business with thugs and tyrants.

Many believe we must have a steep increase in gasoline taxes - up to 50c a gallon over five years - to encourage conservation and more fuel-efficient cars, and to help finance energy research and development. We also must encourage more domestic oil production.

As Milton Friedman says, you tax the things you don't want people to do and you subsidize the things you want them to do.

Also, we must develop new technologies such as smart cars and smart highways, known as Intelligent Vehicle Highway Systems. Using computers and telecommunications technologies in existing cars and highways, it offers huge energy savings.

Defense policy: Aug 2 is a poignant reminder that U.S. interests are not defined entirely by U.S.-Soviet relations and that we still live in a dangerous world.

Regional conflicts, ethnic nationalism, Islamic fundamentalism, nuclear proliferation, terrorism and international banditry remain threats to life and commerce.

We don't need more giddy talk about a peace dividend. The current Middle East crisis demonstrates that the post-war world requires a new defense policy and strategy and a very different kind of arsenal military force structure to defend and advance U.S. interests.

Collective security: The United Nations reaction to the Iraqi invasion of Kuwait was the first time the U.N. worked the way it was designed to work. Power shifted from the General Assembly to the Security Council. When the five permanent members of the Security Council agree, the U.N. can be a potent force in world affairs.

So Aug. 2, 1990, was not only the date of another battle in the desert. It may mark the beginning of an era when Americans get serious about their future.