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Can America Remain Number One?

February 18, 2019 Topic: Security Region: Americas Tags: GeopoliticsWarChinaDemocracyEconomy

Can America Remain Number One?

While it has become nearly axiomatic for observers of world affairs to contend that the U.S.-led postwar order is under growing, if not unprecedented, duress, there is little consensus about what architecture, if any, might replace it.

While it has become nearly axiomatic for observers of world affairs to contend that the U.S.-led postwar order is under growing, if not unprecedented, duress, there is little consensus about what architecture, if any, might replace it. A recent assessment ventures that

the successor to the global system of governance we have known since the Second World War [may be] not another order but the absence of one. It is possible that the world, squeezed between the incompatible visions of a retreating U.S. and a resurgent China, is already hurtling toward chaos.

Given this uncertainty about the path forward, it is not surprising that analysts seek to identify historical parallels to the contemporary era and distill what guidance those comparisons might offer to today’s leaders. Two of the analogies that have emerged from that undertaking have proven especially enduring: the 1930s and the Cold War.

There are three main reasons why some observers contend that we may be either witnessing a return to—or on the cusp of reprising—the 1930s. The first is democratic recession. Freedom House observed at the beginning of 2018 that 2017 marked

the 12th consecutive year of decline in global freedom. Seventy-one countries suffered net declines in political rights and civil liberties in 2017, with only 35 registering gains. Once-promising states such as Turkey, Venezuela, Poland, and Tunisia were among those experiencing declines in democratic standards.

The organization also warned that China and Russia “are acting beyond their borders to squelch open debate, pursue dissidents, and compromise rules-based institutions.”

There is also growing concern about the mobilization of disintegrationist elements within Europe. In a speech in April last year, French president Emmanuel Macron warned that “a sort of European civil war is reappearing,” observing that “our differences, sometimes our national egoisms, appear more important than what unites us in relation to the rest of the world.” Even more ominously, he concluded that a “fascination with illiberalism…is growing by the day.” Examples of that fascination abound. Italy’s interior minister has called for a census of the country’s Roma population. Austria’s chancellor has urged his country to form an “axis of the willing against illegal migration” with Germany and Italy. In a multifaceted effort to limit George Soros’ influence, Hungary has forced the closure of Central European University, a prestigious Budapest-based institution funded by the philanthropist; pressured the Open Society Foundation until Soros declared that its Budapest operations were no longer safe; and passed a “Stop Soros” law that effectively criminalizes efforts to provide humanitarian aid and legal assistance to undocumented immigrants. The country’s prime minister has declared that: “Rather than try to fix a liberal democracy that has run aground, we will build a 21st-century Christian democracy.”

 

Some perspective is in order. The first half of the twentieth century witnessed a sufficiently confident and widespread authoritarian ascent that, according to political theorist John Keane, only eleven electoral democracies remained by 1941. Franklin Roosevelt warned in a speech in March of that year that the United States would have to furnish “fuel in ever-increasing amounts” to safeguard “the great flame of democracy from the blackout of barbarism.” Today there are 116 electoral democracies—down from 120 two decades ago, concerningly, but still an impressive number.

The authoritarian resurgence of the 1930s coincided with and derived momentum from the Great Depression, which gave proponents of relatively untested “isms”—fascism in Japan and Nazism in Germany, notably—grounds to argue that they had insights into the cultivation of order and the generation of prosperity that adherents of democracies either could not or refused to discern. Today, however, there is no phenomenon of comparable magnitude. While the global financial crisis that began a little over a decade ago was a major shock to the system, its principal ideological effect was to delegitimize Western-style democracy, not to lend credence to authoritarian alternatives. The distinction is an important one: skepticism about the former does not automatically translate into support for the latter. One can concurrently express alarm over the problems plaguing many democracies today—national-level political paralysis and ever-increasing income and wealth inquality—and reject the squelching of dissent and the persecution of minorities that occur under strongman rule. In brief, authoritarianism may be gaining renewed traction, but it is doing so from a lower baseline than during the interwar period; democracy, meanwhile, may be experiencing significant challenges, but from a higher baseline.

A second fear is the prospect of deglobalization. Cross-border capital flows fell from $12.4 trillion in 2007 to $4.3 trillion in 2016, a 65 percent decline. The United Nations Investment Trends Monitor reported a 16 percent decline in global foreign direct investment as well as a 23 percent decline in the value of cross-border mergers and acquisitions between 2016 and 2017. There is a growing risk, moreover, that trade tensions between the United States and China could destabilize the world’s most important economic relationship.

It would be premature to suggest, however, that globalization is reversing. The World Bank reports that “net capital inflows [into developing countries] entered positive territory in 2017, following two years of large contractions”—a development that “has been facilitated by the improving economic outlook in several large emerging economies.” There are hopeful signs on trade flows as well. Consider an oft-cited gauge of globalization, the ratio between the growth rate of world merchandise trade and that of real gross world product. Historically hovering at 1.5, it fell to an average of 1.0 between 2011 and 2016; in 2017, however, it rebounded to 1.5. The World Trade Organization (WTO) forecast last April that trade would grow at 4.4 percent in 2018 and 4 percent this year, compared to the post-crisis average of three percent.

Continued progress on bilateral and regional trade deals suggests that this pace may endure. Eleven of the twelve countries that were negotiating a Trans-Pacific Partnership have finalized the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, covering some 13.5 percent of gross world product (GWP). Japan and the European Union (eu) have signed a bilateral trade agreement, the world’s largest, that accounts for roughly 30 percent of GWP. Negotiations are also inching forward on the Regional Comprehensive Economic Partnership, a sixteen-country arrangement that, too, would incorporate some 30 percent of GWP.

The third reason some observers see parallels with the 1930s—and also, incidentally, with the Cold War—is the return of great power competition, with Russia and China occupying center stage. But neither country is posing a frontal assault on the postwar order; the former is opportunistically obstructive, while the latter is selectively revisionist. Moscow is continuously challenged by the North Atlantic Treaty Organization (NATO) to its west and increasingly dependent on China to its east. Beijing’s ambitions, meanwhile, are constrained not only by an increasingly apprehensive Washington but also by strong powers in Canberra, Delhi, Seoul and Tokyo that seek to forestall the resumption of a Sinocentric hierarchy in the Asia-Pacific. While the current order is undoubtedly under strain, there is at least an order to defend. Today, moreover, despite the present vagaries in its foreign policy, the United States is the world’s lone superpower; in the 1930s, by contrast, despite commanding the world’s largest economy, Washington’s military and diplomatic influence beyond its borders lagged far behind its industrial heft.

Perhaps even more common is the suggestion that the United States is entering into a new Cold War. There is little agreement on the antagonist in this alleged confrontation: some say that it is Russia; others, China; yet others, a Sino-Russian authoritarian axis; and even some, the menace of terrorism, in its ever-changing structure and roster of outfits. That this number of actors can be characterized as America’s putative opponent in a new Cold War suggests an intrinsic limitation to the analogy.

To speak of a new Cold War is to suggest not only that the United States once more confronts a rival power with ambitions of global dominance and pretensions to a universal ideology, but also that that power can and will employ territorial aggression, proxy warfare and client states across the world in the service of its strategic objectives. Neither of the two supposed antagonists in this sequel, though, would seem to fit this description.

Russia is undoubtedly a major power, commanding the world’s largest nuclear arsenal, the world’s largest proven reserves of natural gas and a veto on the United Nations Security Council. But it is a pale shadow of the Soviet Union, which, upon dissolving, yielded Russia and fourteen post-Soviet republics, three of which—Latvia, Lithuania and Estonia—now belong to NATO. Russia’s population is slated to decline from roughly 144 million today to 133 million by 2050, a nearly 8 percent drop. Its energy leverage in Europe, while significant, is far less than it was at the end of the Cold War; where Moscow accounted for three-quarters of the EU’s gas imports in 1990, it now accounts for under two-fifths.

Russia has proven itself to be a skilled opportunist: it hived off Abkhazia and South Ossetia from Georgia in 2008, wrested Crimea from Ukraine in 2014 and has exploited the civil war in Syria to establish itself as an increasingly central external actor in the Middle East’s evolution. On balance, though, it remains a predominantly regional power whose ideology has limited international appeal, unlike Communism during the Cold War. Whereas the Soviet Union had national power at least partially commensurate with its revisionist intentions, Russia does not have the capacity to do much more than play the role of occasional spoiler. It is attempting to ride the coattails of China’s resurgence because it recognizes that Beijing, more than any other country, is capable of molding a postwar order more in line with its preferred norms and arrangements.