The United States has maintained international hierarchies over the Western Hemisphere for more than a century and over Western Europe for nearly seven decades. More recently, it has extended similar hierarchies over states in the Middle East. How does the United States exercise authority over other countries? In a world of juridically sovereign states, how is U.S. rule rendered legitimate? Hierarchy has interstate and intrastate distributional consequences for domestic ruling coalitions and regime types. When the gains from hierarchy are large or when subordinate societies share policy preferences similar to those of the United States, as in Europe, international hierarchy is possible and compatible with democracy. When the gains from hierarchy are small and the median citizen has policy preferences distant from those of the United States, as in Central America, international hierarchy requires autocracy, and the benefits of foreign rule will be concentrated within the governing elite. In the Middle East, the gains from hierarchy also appear small, and policy preferences are distant from those of the United States. As a result, the United States has backed sympathetic authoritarian rulers. Although a global counterinsurgency strategy might be viable over the long term, the costs of establishing effective hierarchies in the region imply that the United States is better off retrenching “East of Suez.”

The Iraq War has received little sustained analysis from scholars of international relations. I assess the rationalist approach to war—or, simply, bargaining theory—as one possible explanation of the conflict. Bargaining theory correctly directs attention to the inherently strategic nature of all wars. It also highlights problems of credible commitment and asymmetric information that lead conflicts of interest, ubiquitous in international relations, to turn violent. These strategic interactions were central to the outbreak of the Iraq War in 2003. Nonetheless, bargaining theory is inadequate as an explanation of the Iraq War. Although the problem of credible commitment was real, it could not be solved because of the prior beliefs of the Bush administration that Saddam Hussein was uniquely evil and because of Saddam's inability to signal accurately to multiple audiences, both factors now outside bargaining theory. Nor was the problem of private information an important impediment to bargaining; rather, the information failures observed in both Washington and Baghdad were of their own making as each formed self-deluding beliefs and expectations. Bargaining theory also ignores postwar governance costs and domestic interest groups, both of which contributed to the war. All of these problems require either considerable amendments to the theory or the revision of core assumptions. Drawing on this critique, the final sections draw out the analytic and policy lessons of the Iraq War and suggest, most importantly, the need for a new behavioral theory of war.

Despite increasing attention, scholars lack the analytic tools necessary to understand international hierarchy and its consequences for politics and policy. This is especially true for the informal hierarchies now found in world affairs. Rooted in a formal-legal tradition, international relations scholars almost universally assume that the international system is a realm of anarchy. Although the fact of anarchy remains a truism for the system as a whole, it is a fallacy of division to infer that all relationships within that system are anarchic. Building on an alternative view of relational authority and recent research on the practice of sovereignty, a new conception of international hierarchy is developed that varies along two continua defined by security and economic relations. This construct is operationalized and validated, and then tested in a large- n study of the effects of international hierarchy on the defense effort of countries. The principal finding is that states in hierarchical relationships spend significantly less on defense relative to gross domestic product than states not in such relationships. In short, hierarchy matters and subordination pays; states appear to trade some portion of their sovereignty for protection from external security threats.