The Potential Power Problem The elements of national power approach to power analysis is a variant of the power‐as‐resources approach. In this approach, power resources are treated as if they were power itself. One problem with this approach is that what functions as a power asset in one situation may be a power liability in a different situation. Planes loaded with nuclear bombs may be worse than useless in a situation calling for planes with conventional weapons with insufficient time to unload the nuclear weapons and reload the planes with conventional ones. And the same stockpile of arms that is useful for deterring one country may trigger an arms race with another. Similarly, what constitutes a 'good hand' in card games depends on whether one is playing poker or bridge. Discussions of the capabilities of states that fail to designate or imply a framework of assumptions about who is trying (or might try) to get whom to do what are comparable to discussions of what constitutes a good hand in cards without specifying which game is to be played. The Sprouts called this set of assumptions a 'policy‐contingency framework' (1965, 1971). Focusing on the capabilities of states is simply a way of drawing attention to their potential power. It makes no more sense to talk about state capabilities in general than to talk about state power without (explicitly or implicitly) specifying scope and domain. If one wants to estimate the potential power of Guatemala, it helps to know, nay, it is imperative to know whether it concerns a border dispute with EI Salvador or a trade agreement with the United States. Although it is sometimes suggested that insistence on specification of the scope and domain of potential power relationships makes prediction and or generalization nearly impossible (Guzzini, 2000; Keohane, 1986), this is not true. Specification of scope and domain (or policy‐contingency frameworks) need not imply atheoretical empiricism. Policy‐contingency frameworks may be defined more or less broadly to suit the purpose of the analyst. As Nagel (1975: 14) observes, 'domain and scope need not be particularistic or unique. Depending on one's purpose and the limits imposed by reality, the outcome class may contain a few similar members or many diverse elements'. It is, of course, possible to make predictions or generalize about the potential power of Guatemala (or similar states) without reference to Guatemala's goals and without reference to the goals or capabilities of other states; but it is not clear why one would want to do so. Power resources are the raw materials out of which power relationships are forged. Although it might seem that the predictive value of power resource inventories is impaired by insistence on prior specification of scope and domain, the opposite is true. The accuracy of one's estimate of whether an architect has adequate raw materials to complete his or her project is likely to improve if one first ascertains whether the architect plans to build a birdhouse or a cathedral. Although it is common practice to refer to the ‘power resources’ or ‘capabilities’ of a state as if they were possessions of the state, this practice can be misleading. Strictly speaking, the power resources of a state are not attributes of the state in the same sense that population or territory are attributes. To designate something (time, reputation, weaponry, money, oil, and so on) as a ‘power resource’ is to imply something about its usefulness in getting others to change their behavior—and thus to imply something about the value system and capabilities of these others. (Threats do not work very well against masochists.) The Fungibility Problem 'Fungibility' refers to the ease with which power resources useful in one issue‐area can be used in other issue‐areas. Money in a market economy is the prototypical fungible resource. Indeed, fungibility (that is, liquidity) is one of the defining characteristics of money.5 In a market economy one does not usually need to specify the scope or domain of the purchasing power of money because the same euro (yen, dollar, etc.) can be used to buy a car, a meal, a haircut, or a book.