Obama and the ‘return of Asia’
Joseph S Nye
One of the first challenges that President Barack Obama will face is
the effects of the ongoing financial crisis, which has called into
question the future of American power. An article in The Far Eastern
Economic Review proclaims that “Wall Street’s crack-up presages a global
tectonic shift: the beginning of the decline of American power.”
US President elect Barack Obama |
Russian President Dmitri Medvedev sees the crisis as a sign that
America’s global leadership is coming to an end, and Venezuelan
President Hugo Ch vez has declared that Beijing is now much more
relevant than New York.
Yet the dollar, a symbol of American financial power, has surged
rather than declined. As Kenneth Rogoff, a Harvard professor and former
chief economist of the IMF notes, “It is ironic, given that we just
messed up big-time, that the response of foreigners is to pour more
money into us. They’re not sure where else to go. They seem to have more
confidence in our ability to solve our problems than we do.”
It used to be said that when America sneezed, the rest of the world
caught a cold. More recently, many claimed that with the rise of China
and the petro-states, an American slowdown could be decoupled from the
rest of the world. But when the United States caught the financial flu,
others followed.
Many foreign leaders quickly switched from schadenfreude to fear -
and to the security of US treasury bills.
Crises often refute conventional wisdom, and this one reveals that
the underlying strength of the American economy remains impressive. The
poor performance of Wall Street and America regulators has cost America
a good deal in terms of the soft power of its economic model’s
attractiveness, but the blow need not be fatal if, in contrast to Japan
in the 1990’s, the US manages to absorb the losses and limit the damage.
The World Economic Forum still rates the American economy as the
world’s most competitive, owing to its labour-market flexibility, higher
education, political stability, and openness to innovation. The larger
question concerns the long-term future of American power.
A new forecast for 2025 being prepared by the US National
Intelligence Council projects that American dominance will be “much
diminished,” and that the one key area of continued American superiority
- military power - will be less significant in the competitive world of
the future. This is not so much a question of American decline as “the
rise of the rest.”
Power always depends on context, and in today’s world, it is
distributed in a pattern that resembles a complex three-dimensional
chess game. On the top chessboard, military power is largely unipolar
and likely to remain so for a while. But on the middle chessboard,
economic power is already multi-polar, with the US, Europe, Japan and
China as the major players, and others gaining in importance.
The bottom chessboard is the realm of transnational relations that
cross borders outside of government control. It includes actors as
diverse as bankers electronically transferring sums larger than most
national budgets, as well as terrorists transferring weapons or hackers
disrupting internet operations.
It also includes new challenges like pandemics and climate change. On
this bottom board, power is widely dispersed, and it makes no sense to
speak of unipolarity, multipolarity or hegemony.
Even in the aftermath of the financial crisis, the giddy pace of
technological change is likely to continue to drive globalisation, but
the political effects will be different for the world of nation-states
and the world of non-state actors. In inter-state politics, the most
important factor will be the continuing “return of Asia.”
In 1750, Asia had three-fifths of the world population and
three-fifths of the world’s economic output. By 1900, after the
industrial revolution in Europe and America, Asia accounted for just
one-fifth of world output. By 2040, Asia will be well on its way back to
its historical share.
The rise of China and India may create instability, but it is a
problem with precedents, and we can learn from history about how
policies can affect the outcome. A century ago, Britain managed the rise
of American power without conflict, but the world’s failure to manage
the rise of German power led to two devastating World Wars.
The rise of non-state actors also must be managed. In 2001, a
non-state group killed more Americans than the government of Japan
killed at Pearl Harbour.
A pandemic spread by birds or travellers on jet aircrafts could kill
more people than perished in World Wars I or II. The problems of the
diffusion of power (away from states) may turn out to be more difficult
than shifts in power between states.
The challenge for Barack Obama is that more and more issues and
problems are outside the control of even the most powerful state.
Although the US does well on the traditional measures of power, those
measures increasingly fail to capture much of what defines world
politics, which, owing to the information revolution and globalisation,
is changing in a way that prevents Americans from achieving all their
international goals by acting alone.
For example, international financial stability is vital to American
prosperity, but the US needs the cooperation of others to ensure it.
Global climate change, too, will affect the quality of life, but the US
cannot manage the problem alone.
And, in a world where borders are becoming increasingly porous to
everything from drugs to infectious diseases to terrorism, America must
mobilise international coalitions to address shared threats and
challenges.
As the world’s largest economy, American leadership will remain
crucial. The problem of American power in the wake of the financial
crisis is not one of decline, but of a realisation that even the most
powerful country cannot achieve its aims without the help of others.
Fortunately, Barack Obama understands that.
(The writer is a former US assistant secretary of defence.) |