Shifting focus

Early this week, the eyes of the world’s media were focused on the election of the President of the United States of America (generally abbreviated to the acronym ‘POTUS’), whom it commonly refers to as the ‘leader of the Free World’ and ‘the most powerful man in the world’.

Many were they who breathed a sigh of relief that it was Barack Hussein Obama and not Mitt Romney who won the election. They were mainly from America’s underclass of Blacks, Hispanics and poor Whites (often derided as ‘Trailer Trash’) – who stood to lose most from a far-right victory.

Yet, as many critics have pointed out the difference, as far as the rest of the world is concerned, may be merely one of degree. Whoever is POTUS, there are certain policy norms which will continue to be maintained, such as the continued presence of US troops in countries such as Afghanistan and Iraq, the persistence of drone strikes inside Pakistan and the prolongation of the real ‘Special Relationship’ with Israel.

And whoever is POTUS, he (there is still no ‘she’ on the horizon) will have to live with the reality of a diminished role for the USA as the ‘World’s Policeman’. At the height of its powers, the Armed Forces of the US had a ‘Two War Capability’, meaning they could plan for a major war against the Soviet Union and its allies, as well another conflict elsewhere.

World economy

After the end of the Cold War, the ‘Sole Superpower’ reduced this to a ‘Two Regional War Capability’, so that two simultaneous ‘minor’ wars could be fought. However, the Bush adventures in Afghanistan and Iraq so ran down the American military machine that, in January’s defence review it has had to downgrade its target to a ‘One War Capability’.

Even this capability is dependent on the goodwill of its allies. The US is now in the same position as Britain (the former ‘Sole Superpower’, which it supplanted) was in at the end of the First World War.

The decline in US power has been accompanied by a steady increase in the power of China. The Asian giant has the world’s largest Armed Forces, and is modernising them rapidly. The growth in its military might is supported by the world’s fastest-growing - as well as the second-largest - economy. It is the biggest exporter of goods and services, the second biggest importer.

Most importantly, however, it has over US $ 4 trillion in external assets. About a quarter of these consist of US government debt, of which over 8 percent is held by the People’s Bank of China. The world economy depends on how much support is given to it by China.

This week, the Chinese Communist Party holds its 18th Congress, during which it is expected to pick a new General Secretary; who, it is anticipated will be the country’s next President when the incumbent, Hu Jintao steps down in March.

The Time Magazine disparagingly called the election one for the ‘Leader of the Unfree World’. Certainly, China is seen to be a leader of the loose grouping of countries unaffiliated to the American attempts to hang onto it hegemony.

However, even the generally right-wing British newspaper the Daily Mail acknowledged that the election of a new Chinese leader ‘will arguably have far more impact on our lives’ than the re-election of Obama.

The newspaper points out that the China Investment Corporation has bought into Thames Water, Britain’s largest water utility company, while the Chinese telecom-electronics giant Huawei has upped its investment in the country by US $ 2 billion.

Mu Xuequan of China’s Hsinhua News Agency editorialised on Thursday that ‘it is the right time for the Obama administration to rethink its policy on China... Relations between the two countries have become one of the most important in the world, and to some extent, this relationship can help best decide the future of the world order itself.’

‘Containment or engagement policies have both been used towards China, and the U.S. chooses from the two options mainly based on its perception that China is a threat to it,’ he continued, concluding that ‘It is time for the U.S. to rethink its strategy towards China in the long-term, and that is to engage with each other for a more peaceful and prosperous world. ’

This viewpoint was re-iterated by former Australian Prime Minister and Foreign Minister Kevin Rudd, a Mandarin-speaking China expert, who wrote on Friday that ‘China wants global strategic stability to continue for the simple reason that conflict undermines prospects for economic growth.’

‘The core question for China’ he wrote, ‘will remain what influence it will seek to bring to bear on the future evolution of the global rules-based order itself.’

Peace and security

However, deeds speak louder than words. Rudd was replaced as Prime Minister, in what was widely regarded as an anti-Chinese coup, by Julia Gillard. The earlier part of her rule was, indeed characterised by a commitment to Obama’s Asia-Pacific policy of ‘containment’ of China.

Last month Gillard made public a White Paper, ‘Australia in the Asian Century’, which looked to re-focus away from its ‘old countries’ to its Asian neighbours. She ruled out any policy aimed at containing China's military growth, which it says would not work.

The paper said that Australia was ‘working closely with China to build a comprehensive, constructive and cooperative relationship that encompasses not only trade, resources and investment, but also political, security and people-to-people connections... With a long commitment to peace and security in the region, we have a key interest in building defence and broader security cooperation with China.’

When a policy review from a key American ally spells out in such clear language the new geopolitical reality, the writing is on the wall. China is not yet a superpower, but it is closing on parity with the ex-‘Sole Superpower’. The rest of the world, like Australia, needs to shift focus.