The Future (19 page)

W
ITH A TIGHTLY INTEGRATED GLOBAL ECONOMY AND A PLANET-WIDE
digital network, we are witnessing the birth of the world’s first truly global civilization. As knowledge and economic power are multiplied and dispersed far more widely and swiftly than by the Print and Industrial Revolutions, the political equilibrium of the world is undergoing a massive change on a scale not seen since the decades following Europe’s linkage by sea routes to the Americas and Asia 500 years ago.

As a result, the balance of power among nations is changing dramatically. Just as the Industrial Revolution led to the dominance of the world economy by Western Europe and the United States, the emergence of Earth Inc. is shifting economic power from West to East and spreading it to the new growth economies developing throughout the world. China, in particular, is overtaking the U.S. as the center of gravity in the global economy.

More importantly, just as nation-states emerged as the dominant form of political organization in the wake of the printing press, the emergence of the Global Mind is changing many of the social and political assumptions on which the nation-state system was based. Some of the
sources of power traditionally wielded primarily by nations are no longer as firmly under their exclusive control. While our individual political identities remain primarily national, and will for a long time to come, the simultaneous globalization of information and markets is transferring power once reserved for national governments to private actors—including multinational corporations, networked entrepreneurs, and billions of individuals in the global middle class.

No nation can escape these powerful waves of change by unilaterally imposing its own design. The choices most relevant to our future are now ones that confront the world as a whole. But because nation-states retain the exclusive power to negotiate policies and implement them globally, the only practical way to reclaim control of our destiny is to seek a global consensus within the community of nations to secure the implementation of policies that protect human values. And since the end of World War II—at least until recently—most of the world has looked primarily to the United States of America for leadership when facing the need for such a consensus.

Many fear, however, that the ability of the U.S. to provide leadership in the world is declining in relative terms. In 2010, China became the world’s leading manufacturing nation, ending a period of U.S. leadership that had lasted for 110 years. An economic historian at Nuffield College, Oxford, Robert Allen, said this milestone marked the “
closing of a 500-year cycle in economic history.” When China’s overall economic strength surpasses that of the United States later this decade, it will mark the
first time since 1890 that any economy in the world has been larger than the American economy.

Worse, not since the 1890s has U.S. government decision making been as feeble, dysfunctional, and servile to corporate and other special interests as it is now. The gravity of the danger posed by this debasement of American democracy is still not widely understood. The subordination of reason-based analysis to the influence of wealth and power in U.S. decision making has led to catastrophically bad policy choices, sclerotic decision making, and a significant weakening of U.S. influence in the world.

Even a relative decline in the preeminence of the U.S. position in the world system has significant consequences. It remains “the indispensable nation” in reducing the potential for avoidable conflicts—keeping the sea lanes open, monitoring and countering terrorist groups, and playing
a balancing role in tense regions like the Middle East and East Asia, and in regions (like Europe) that could face new tensions without strong U.S. leadership. Among its many other roles, the United States has also exercised responsibility for maintaining relative stability in the world’s international monetary system and has organized responses to periodic market crises.

At the moment, though, the degradation of the U.S. political system is causing a dangerous deficit of governance in the world system and a gap between the problems that need to be addressed and the vision and cooperation necessary to address them. This is the real fulcrum in the world’s balance of power today—and it is badly in need of repair. In the absence of strong U.S. leadership, the community of nations is apparently no longer able to coalesce in support of international coordination and agreements that establish the cooperative governance arrangements necessary for the solution of global problems.

Meetings of the G20 (which now commands more attention than the G8) have become little more than a series of annual opportunities for the leaders of its component nations to issue joint press releases. Their habit of wearing matching colorful shirts that represent the fashion motif of the host nation recalls the parable of the child who noticed that the emperor has no clothes. Except in this case, the clothes have no emperor.

Largely because of U.S. government decisions to follow the lead of powerful domestic corporate interests, once-hopeful multilateral negotiations—like the Doha Round of trade talks (commenced in 2001) and the Kyoto Protocol (commenced in 1997)—are now sometimes characterized as “zombies.” That is, they are neither alive nor dead; they just stagger around and scare people. Similarly, the Law of the Sea Treaty is in a condition of stasis.

The global institutions established with U.S. leadership after World War II—the United Nations, the World Bank, the International Monetary Fund, and the World Trade Organization (formerly the General Agreement on Tariffs and Trade)—are now largely ineffective because of the global changes that have shaken the geopolitical assumptions upon which they were based. Chief among them was the assumption that the U.S. would provide global leadership.

So long as the United States offered the vision necessary for these institutions—and so long as most of the world trusted that U.S. leadership
would move the world community in a direction that benefited all—these institutions often worked well. If any nation’s goals are seen as being motivated by the pursuit of goals that are in the interest of all, its political power is greatly enhanced. By contrast, if the nation offering leadership to the world is seen as primarily promoting its own narrower interests—the commercial prospects of its corporations, for example—its capacity for leadership is diminished.

Two thirds of a century after their birth, these multilateral institutions face criticism from developing countries, environmentalists, and advocates for the poor because of what many see as “democratic deficits.” Both the World Bank and the
International Monetary Fund require support from 85 percent of the voting rights held by member nations. Since the United States alone has more than 15 percent of the voting rights in both organizations,
it has effective veto power over their decisions. Similarly, some countries ask why France and the United Kingdom are still among only five permanent
members of the U.N. Security Council when Brazil, with a GDP larger than either, and India, whose GDP is greater than both combined and will soon be the most populous country in the world, are not.

The significant loss of confidence in U.S. leadership, especially since the economic crisis of 2007–08, has accelerated the shift in the equilibrium of power in the world. Some experts predict the emergence of a new equilibrium with both the United States and China sharing power at its center;
some have already preemptively labeled it the “G2.”

Other experts predict an unstable, and more dangerous, multipolar world. It seems most likely that the increasing integration of global markets and information flows will lead to an extended period of uncertainty before global power settles into a new more complex equilibrium that may not be defined by poles of power at all. The old division of the world into rich nations and poor nations is changing as many formerly poor nations now have faster economic growth rates than the wealthy developed nations. As the gap closes between these fast-growing developing and emerging economies on the one hand and the wealthy mature economies on the other, economic and political power are not only shifting
from West to East, but are also being widely dispersed throughout the world: to São Paulo, Mumbai, Jakarta, Seoul, Taipei, Istanbul, Johannesburg, Lagos, Mexico City, Singapore, and Beijing.

Whatever new equilibrium of power emerges, its configuration will be determined by the resolution of several significant uncertainties about the future of the United States, China, and nation-states generally: First, is the United States really in a period of decline? If so, can the decline be reversed? And if not, is it merely relative to that of other nations, or is there a danger of an absolute decline? Second, is China likely to continue growing at its current rate or are there weaknesses in the foundations on which its prosperity is being built? Finally, are nation-states themselves losing relative power in the age of Earth Inc. and the Global Mind?

There is a lively dispute among scholars about whether the United States is in decline at all. The loss of U.S. geopolitical power has been a recurring theme for far longer than many Americans realize. Even before the U.S. became the most powerful nation,
there were episodic warnings that American power was waning. Some argue that concerns about China overtaking the United States in forms of power other than economic output represent just another example of what happened when so many were concerned about Japan Inc. in the 1970s and 1980s—and even earlier concerns when the former Soviet Union was seen as a threat to U.S. dominance in the 1950s and 1960s.

For more than a decade following World War II, many strategic thinkers worried that
the U.S. was in danger of quickly falling from the pinnacle of world power. When the USSR acquired nuclear weapons and tightened its grip on Eastern and Central Europe, these fears grew. When Sputnik was launched in 1957, making the USSR the first nation in space, the warning bells rung by declinists were heard even more loudly.

Many of the alarms currently being sounded about the decline of U.S. power are based on a comparison between our present difficulties and a misremembered sense of how completely the U.S. dominated global decision making in the second half of the twentieth century. A more realistic and textured view would take into account the fact that there was never a golden age in which U.S. designs were implemented successfully without resistance and multiple failures.

It is also worth remembering that while the U.S. share of global economic output fell from 50 percent in the late
1940s to roughly 25 percent
in the early 1970s, it has
remained at that same level for the last forty years. The rise of China’s share of global GDP and the economic strength of other emerging and developing economies has come
largely at the expense of Europe, not the United States.

The rise of the United States as the dominant global power began early in the twentieth century
when it first became the world’s largest economy, when President Theodore Roosevelt aggressively asserted U.S. diplomatic and military power, and when it played the crucial role in determining the outcome of World War I under President Woodrow Wilson. And of course after providing the decisive economic and military strength to defeat the Axis powers in World War II, the United States emerged as the victor in both the European and Pacific theaters and was recognized as the leading power in the world. The economies of the European nations had been devastated and exhausted by the war. Those of Japan and Germany had been destroyed. The Soviet Union, having
suffered casualties 100 times greater than those of the United States, had been weakened. Whatever antithetical moral authority it might have once aspired to under Lenin had been long since destroyed by
Stalin’s 1939 pact with Hitler and his exceptional cruelty and brutality toward his own people.

Moving quickly, the United States provided crucial leadership to establish the postwar institutions for world order and global governance. These included the Bretton Woods Agreement,
which formalized the U.S. dollar as the world’s reserve currency, and a series of regional military self-defense alliances, the most important of which was NATO, the North Atlantic Treaty Organization. By using foreign aid and generous trade agreements that provided access to U.S. markets, the United States grew into an even more dominant role. And the United States promoted democratic capitalism throughout the noncommunist parts of the world.

It catalyzed the emergence of European economic and political integration by midwifing the European Coal and Steel Community (
which later evolved into the Common Market and the European Union). And the visionary and generous Marshall Plan lifted the nations of Europe that had been devastated by World War II to prosperity and encouraged a commitment to democracy and regional integration. Secretary of State Cordell Hull, who was described by FDR as “
the father of the United Nations,” was an advocate of freer reciprocal cross-border trade in Europe and the world, arguing that
“when goods cross borders, armies do
not.” By presiding over the reconstruction, democratization, and demilitarization of Japan, the United States also solidified its position as the dominant power in Asia.