The Stockholm International Peace Research Institute (SIPRI) just released their 2012 report on trends in world military expenditures. The report -- hell, just the press release -- should please a lot of people in the foreign policy community, albeit for different reasons.
For those decrying the global arms race, the topline figure should be cause for cheer:
World military expenditure totalled $1.75 trillion in 2012, a fall of 0.5 per cent in real terms since 2011, according to figures released today by Stockholm International Peace Research Institute (SIPRI).
Hooray! Fewer arms, more hugs, or something like that!!
For neoconservatives, however, the reasons behind that drop in aggregate defense spending will vindicate their worries. The press release confirms the decline in U.S. hegemony in defense spending:
In 2012 the USA’s share of world military spending went below 40 per cent for the first time since the collapse of the Soviet Union. A declining trend that began in 2011 accelerated in 2012, with a drop in US military spending of 6 per cent in real terms to $682 billion....
US military spending in 2012 was also projected to be $15 billion lower than previously planned as a result of cuts to the Department of Defense linked to the 2011 Budget Control Act. The bulk of cuts under this legislation will begin in 2013.
So, with the decline in U.S. military expenditures, we're in real danger of being overtaken by the Chinese, right? Well ... there's enough grist in the report for neoconservative skeptics as well.
The fact sheet puts this decline U.S. defense spending in the proper perspective. The United States still spends four times as much on defense as the next-biggest spender (China). Furthermore, "US spending was still more than the combined spending of the next 10 countries (p. 4)."
Will China's defense spending eventually match the United States? Assuming China grows at a healthy clip -- hardly a guarantee -- sure. But as the Economist noted a few weeks ago, tweaking those assumptions just a tad leads to some very different predictions about when defense parity will occur:
What's more intriguing is the effect of the Great Recession on defense spending:
Even in those parts of the world where spending has increased, the effects of the economic crisis can still be seen: slowing economic growth in emerging regions has led to slower rates of growth in military spending. Only the Middle East and North Africa increased their rate of military spending between 2003–2009 and 2009–2012.
The average annual rate of military spending increase in Asia, for instance, has halved from 7.0 per cent per year in 2003–2009, to 3.4 per cent per year in 2009–2012. The slow-down was most dramatic in Central and South Asia, where military spending was growing by an average of 8 per cent per year in 2003–2009, but by only 0.7 per cent a year since 2009, and actually fell in 2012, by 1.6 per cent.
Here's the chart:
That chart massively undersells the decline in defense spending, because it measures absolute levels of military spending and not spending as a percentage of global output. If you use that metric, then defense spending's share of the global economy has fallen by about half since the end of the Cold War.
It's almost as if the 2008 financial crisis and subsequent recession didn't trigger the arms races and general increase in political conflict that some expected would happen. It's almost as if the current threats to national security aren't as serious as they were back in the day.
A little more than two years ago I wrote a blog post entitled "The End of Power?" After riffing on the subject for a spell, I closed with:
So... we live in a world in which more actors have vetoes over systemic change but no actor has the ability to truly compel change. This leads to lots of talk about "G-zero worlds" and so forth.
Just to be provocative, however, I wonder if what's truly changed is the extinction of compellence power as we know it. The primary, ne plus ultra tools of compellence require a willingness to kill, jail, or starve a lot of people. Recent flare-ups like Iran in 2009 and Egypt right now suggest that such actions are possible at the domestic level but pretty damn costly; even authoritarian countries flinch at using brute force on a domestic population. Cross-border efforts are even more expensive in terms of both material and reputational costs.
This isn't the end of power, but it might be the end of one particular dimension of power. I'm not entirely convinced that this supposition is true and am willing/eager to hear counterarguments. That said, I still hereby claim The End of Power as my title, so everyone else just back off, OK?
Well, so much for my claim. Former FP head honcho Moisés Naim has a new book out called... The End of Power: From Boardrooms to Battlefields and Churches to States, Why Being In Charge Isn't What It Used to Be. His argument:
Power is shifting -- from large, stable armies to loose bands of insurgents, from corporate leviathans to nimble start-ups, and from presidential palaces to public squares. But power is also changing, becoming harder to use and easier to lose. As a result, argues award-winning columnist and former Foreign Policy editor Moisés Naím, all leaders have less power than their predecessors, and the potential for upheaval is unprecedented. In The End of Power, Naím illuminates the struggle between once-dominant megaplayers and the new micropowers challenging them in every field of human endeavor. The antiestablishment drive of micropowers can topple tyrants, dislodge monopolies, and open remarkable new opportunities, but it can also lead to chaos and paralysis. Drawing on provocative, original research and a lifetime of experience in global affairs, Naím explains how the end of power is reconfiguring our world.
The originality of the argument -- along with the subtitle -- saves Moisés from some serious legal retribution!! Well, that and he asked me to moderate a panel on the topic with him and Fareed Zakaria at the Council on Foreign Relations. Here's the video. Enjoy!
What with all the horses**t about "currency wars" floating around over the past few months, the occasional reader might be tricked into thinking that protectionist sentiments are at a new high. After all, with a weak global economy, one would expect enthusiasm about trade to be about as vibrant as the Doha round -- i.e., deader than a doornail. As someone with a betting interest in the United States enacting an ambitious foreign economic policy agenda, you'd think I'd be pretty depressed right about now.
Ha -- wrong!! In actuality, public sentiment on trade is pretty robust. And as Bruce Stokes notes, public sentiment for a transatlantic trade deal is pretty positive:
[C]ontrary to the widespread assumption that protectionist sentiments are rising in the wake of the Great Recession, 58 percent of Americans say they support increased trade with the EU. The same feeling exists across the Atlantic. Three-quarters of the Italians, nearly two-thirds of the British (65 percent) and more than half of the French (58 percent) and Germans (57 percent) believe in deepening trade and investment ties between the European Union and the United States; 63 percent of Americans agree, according to a 2007 German Marshall Fund survey.
There is also strong support for one of the thorniest challenges that lie ahead: harmonization or mutual recognition of national regulations on goods and services, everything from food standards to insurance. Overwhelmingly Italians (87 percent), British (84 percent), French (82 percent), Americans (76 percent) and Germans (71 percent) support such efforts, according to the Marshall Fund survey.
That's just trade between two developed economies, however. Surely, in a slack economy, Americans are more wary of trade in general, right?
Wrong again!! Gallup has the surprising polling results here:
Americans' views on foreign trade have become much more positive this year, departing from their more skeptical position of the last several years. Americans are now about as positive toward foreign trade as they were during the better economic times of the 1990s and early 2000s.
That means the Obama administration is likely operating in an environment more supportive of U.S. trade deals with other countries than has been the case in the recent past. The Obama administration is currently exploring an ambitious free-trade deal between the United States and the European Union, and continues to work toward a trade agreement with Australia and other Pacific nations.
Here's the key graph:
Now, first of all, astute readers might argue that this disproves my oft-repeated claim that the American people are stone cold mercantilists. To which I say, look at the question that's being asked -- exports good, imports bad. The mercantilism is baked into the polling question!! Essentially, what this poll reveals is enthusiasm for exports, not trade more generally.
That said, a closer look at the poll also suggests something even more promising. It would appear that public enthusiasm about trade exports is a leading indicator for rational expectations of U.S. economic growth. The only other positive jump like this came just as the 1990s economic boom really kicked into gear. Even more intriguingly, Americans got much more pessimistic about trade prior to the 2008 finanmcial crisis. And, indeed, even Gallup points out that U.S. economic confidence is at a post-crisis high right now, sequester or no sequester.
We're now in the realm of pure speculation, but another source of American optimism on trade comes from some of the underlying positive trends I talked about a year ago. U.S. consumers are almost done with their necessary deleveraging; the U.S. manufacturing sector continues its small boomlet; and projections about U.S. energy production have become even more optimistic.
These are all intrinsically good trends, but the spillover effect on American attitudes towards trade is particularly promising. The spike in public enthusiasm from last yeear is politically significant. At a minimum, it suggests that president Obama won't face gale-force headwinds in trying to negotitae trade deals. Which means I could win my bet with Shadow Government's Phil Levy. Which is the only thing that matters.
As someone who had a little fun at President Obama's expense with a slight rewriting of his first inaugural address over the weekend, I will not be so indecorous as to skewer his second inaugural address in as rough a manner. A few thoughts on the speech and pomp and circumstance and commentary, however:
1) The build-up to the speech demonstrates the blind spots that occasionally hobble our political class. All long weekend I've heard that good second inaugurals are rare or inconsequential (save Lincoln's, of course). This demonstrates a remarkably short-term memory. I'm not George W. Bush's biggest fan, but his second inaugural address was both significant in policy implications and lyrical in its use of rhetoric. If political commentators can't parse the difference between a good speech and good policy, what chance do they have of providing any enlightenment about what's to come in politics?
2) As for Obama's rhetoric, on the whole, I'd say this was both a more confident and relaxed speech than his first inaugural -- and a measure of the ways in which the country has changed in the past four years. His use of "we the people" was an effective trope and highlighted some trends that sometimes get lost in DC obsessions about the right-wing backlash to Obama. The simple fact is that over the past four years Americans have become significantly more tolerant of each other, particlarly with respect to gays and lesbians. Obama was smart to place this in a broader inexorable march towards less discrimination and greater civil and political rights in the United States. At the same time, Obama also did not shy away from his progressive economic message. We'll see how well that goes moving fowards.
3) As for the foreign policy section of the speech... meh. Here's the biggest paragraph:
We will defend our people and uphold our values through strength of arms and rule of law. We will show the courage to try and resolve our differences with other nations peacefully – not because we are naïve about the dangers we face, but because engagement can more durably lift suspicion and fear. America will remain the anchor of strong alliances in every corner of the globe; and we will renew those institutions that extend our capacity to manage crisis abroad, for no one has a greater stake in a peaceful world than its most powerful nation. We will support democracy from Asia to Africa; from the Americas to the Middle East, because our interests and our conscience compel us to act on behalf of those who long for freedom. And we must be a source of hope to the poor, the sick, the marginalized, the victims of prejudice – not out of mere charity, but because peace in our time requires the constant advance of those principles that our common creed describes: tolerance and opportunity; human dignity and justice.
This is pretty boilerplate, in my book. Nothing new, nothing particularly soaring. It almost read as if it was a placeholder for better text. In that, this speech was a marked contrast to Bush's second inaugural, which was principally about foreign affairs.
4) That said, the most significant foreign policy implications in this speech weren't in that paragraph, but earlier:
Some may still deny the overwhelming judgment of science, but none can avoid the devastating impact of raging fires, and crippling drought, and more powerful storms. The path towards sustainable energy sources will be long and sometimes difficult. But America cannot resist this transition; we must lead it. We cannot cede to other nations the technology that will power new jobs and new industries – we must claim its promise. That’s how we will maintain our economic vitality and our national treasure – our forests and waterways; our croplands and snowcapped peaks. That is how we will preserve our planet, commanded to our care by God. That’s what will lend meaning to the creed our fathers once declared.
I don't know if this will translate into concrete policy achievements, but it's interesting that Obama put it front and center in this speech. It's also interesting that, like Bush, he used religious imagery and religious authority to make the case for addressing climate change as an urgent national imperative.
5) Finally -- and I know this is gonna be controversial -- but I'm gonna say it anyway: Kelly Clarkson outsang Beyonce today. I would not have expected that going in. I suspect Beyonce might have had some technical difficulties. While they are both excellent singers, on nine out of ten days I'd expect Beyonce to outclass Clarkson. But not today. Not today. "The Star-Spangled Banner" is a tougher song than "My Country Tis of Thee," but still.
That said, my favorite pop rendition of a patriotic song is embedded below:
What did you think?
This week, there's been a rash of articles on the state of GOP foreign policy thinking, as well as some interesting and constructive responses to my Foreign Affairs essay on the same subject. I will try to respond to some of these over the weekend -- but first I think it would be useful to talk more precisely about the claimed benefits of military power.
One of the points I made in my essay was that Republicans need to take economic statecraft more seriously, but to be fair, this holds for the foreign policy community more generally. The relationship between military power and economic influence is often talked about in general terms, with a lot of casual assertions getting tossed around. But I think a lot of these assertions are wrong.
For example, prominent American foreign policy commentators often trump the benefits of America's overseas military presence. Danielle Pletka gets at this in her Foreign Policy essay when she says, "Americans have benefited tremendously from their involvement abroad," though she stays in generalities. To talk specifically, how exactly does the U.S. gain economically from its outsized military footprint?
Fortunately, we do have an attempt at an answer. In the latest Foreign Affairs, Stephen Brooks, John Ikenberry, and William Wohlforth argue strongly in favor of "deep engagement." They proffer a number of reasons why the U.S. benefits from current grand strategy -- but one of the more intriguing ones is that the U.S. receives direct economic benefits from its security arrangements:
A global role also lets the United States structure the world economy in ways that serve its particular economic interests. During the Cold War, Washington used its overseas security commitments to get allies to embrace the economic policies it preferred -- convincing West Germany in the 1960s, for example, to take costly steps to support the U.S. dollar as a reserve currency. U.S. defense agreements work the same way today. For example, when negotiating the 2011 free-trade agreement with South Korea [KORUS], U.S. officials took advantage of Seoul's desire to use the agreement as a means of tightening its security relations with Washington. As one diplomat explained to us privately, "We asked for changes in labor and environment clauses, in auto clauses, and the Koreans took it all." Why? Because they feared a failed agreement would be "a setback to the political and security relationship."
Now, this gets specific!! According to this paragraph, reliance on U.S. security means that Washington can obtain better economic terms. Sounds great!!
Except that I don't think it's true.
With respect to West Germany, it's certainly true that Washington was able to get Berlin to accommodate to U.S. preferences -- but only for a few years. The Bretton Woods system ended in 1971 because the Germans finally said "Nein!!" to U.S. inflation. So the economic benefit wasn't that great.
The South Korea case is more intriguing, because it's present-day and there's a real, live policymaker quote there. If a U.S. administration official asserts that the security relationship mattered, then it mattered, right?
Well.... no. We need to compare KORUS with something equivalent to provide a frame of reference. If security really mattered that much, then the Korea-United States free trade agreement should contain terms that are appreciably more favorable to the United States than those contained in, say, the Korea-European Union free trade agreement, which was negotiated at the same time. This is a great test. After all, the U.S. is the most important security partner for South Korea, whereas the only thing the European Union could offer to Seoul was its large market. So if Brooks, Ikenberry and Wohlforth are correct, the U.S. should have bargained for much better terms than the E.U. Right?
A Korean analysis of the two agreements, however, do not reveal that result:
[T]he United States has more favorable treatment in meat and vegetable products and transportation, while the EU has better treatment in processed foods, chemicals, and machinery. The large difference in outcomes in animal and animal products between the KORUS FTA and the Korea-EU FTA can be ascribed to the the reflection of greater sensitivity of the Korean market in this sector in the Korea-EU FTA compared with the KORUS FTA. Therefore the EU received a less favorable tariff reduction schedule than the United States in this area. This is true in the areas of raw hides, skins, leather, and furs, and transportation.
We have the opposite case, however, in the foodstuff sector: the many differences in Korean tariff liberalization schedules in the U.S. and European FTAs could be a result of the reflection of the EU positions, which preferred earlier tariff eliminations on many items in the Korea-EU FTA. This is also true in the manufacturing sectors such as hemicals and allied industries, plastics and rubber, textiles, and machinery and electrical products.
In (slightly) plainer English, the U.S. got better terms on the export sectors it cared about more, and the E.U. got better terms on the export sectors it cared about more. Both agreements are comprehensive in scope and contain roughly similar terms across most other sectors. Indeed, both the Congressional Research Service and U.S. Trade Representative's office acknowledge the basic similaritry between the deals, as well as the areas where the Europeans did better. So, in other words, America's ongoing security relationship with South Korea did not lead to any asymmetric economic gains.
Now, this is not to say that there are no economic benefits to America's forward military presence. There are other arguments out there, and they should also be evaluated. My point here is simply to cast a skeptical eye on claims that America's overseas military presence pays for itself in the form of geopolitical favoritism. Because I don't think that's true.
A year ago your humble blogger penned a post suggesting that the United States was really, really, really super-bad at being an empire. Those who claim that the United States conducts all aspects of its foreign policy purely for profit need to cope with the fact that America really stinks at making a buck from its military actions. A year later, with respect to Afghanistan and Iraq, that assessment really hasn't changed: the United States investment in both of those countries remains a massive net loss. Even Libya doesn't seem to have panned out all that well as a money-making opportunity for Americans.
As a social scientist, however, I need to seek out potentially contradictory data points, and Matthew Brumwasser has a story in the New York Times about how one U.S. military action does seem to be yielding economic gains.... for the individual policymakers responsible for it:
So many former American officials have returned to Kosovo for business — in coal and telecommunications, or for lobbying and other lucrative government contracts — that it is hard to keep them from colliding.
They also include Wesley K. Clark, a retired Army general and the former supreme allied commander of NATO forces in Europe who ran the bombing campaign against the Serbian strongman Slobodan Milosevic; and Mark Tavlarides, who was legislative director at the Clinton White House’s National Security Council.
The State Department has no policy that forbids former diplomats from lobbying on behalf of nations where they served or returning to them for profit, beyond the one applying to federal employees as a whole, which prohibits senior officials from contacting agencies where they once worked for one year and bans all federal employees for life from advising on the same matters.
Kosovo is not the only nation where former officials have returned to conduct business — Iraq is another example — but it presents an extreme case, and perhaps a special ethical quandary, given the outsize American influence here. Pristina, the capital, may be the only city in the world where Bob Dole Street intersects Bill Clinton Boulevard.
Foreign policy experts say the practice of former officials’ returning for business is more common than acknowledged publicly. Privately, former officials concede the possibility of conflicts of interest and even the potential to influence American foreign policy as diplomats who traditionally made careers in public service now rotate more frequently to lucrative jobs in the private sector.
If you read the whole story, however, you'll see that the correlation between ex-policymakers profiting and U.S. corporation profiting is not a perfect one. For example, the Slovenian firm IPKO hired Ms. Albright to be a "special advisor," no doubt to advance their burgeoning interests in Kosovo.
Still, this is a data point that suggests at least some Americans can make a profit off of successful military actions. Of course, contrary to the somewhat sinister tone of the story, I'm not sure that Americans are really screwing over the Kosovars in their hunt for government contracts and assets. Indeed, paradoxically, the very surfeit of ex-policymakers in Pristina means there's real competition among them for prime investments in Kosovo -- which means better terms for the Kosovars.
So yeah, I still think Americans are awful at empire-building.
What do you think?
Your humble blogger is slammed with day job duties this week, but for your reading pleasure, do check out this debate I moderated between the Financial Times' Gideon Rachman (author of Zero-Sum World) and the Brookings Institution's Robert Kagan (author of The World America Made) on the future of American power.
WARNING: I fear I might stink as a moderator, as I conclude:
I hereby declare myself to be a uniter rather than a divider when it comes to moderating exchanges, thereby guaranteeing that The Powers That Be at will never ask me to do anything like this ever again.
Still, check it out for yourself and come to your own conclusion.
My recent post on the overstatement of American decline has probably been my most popular single non-zombie item since moving the blog to Foreign Policy. It has also attracted some useful observations on Michael Beckley's International Security essay in particular -- see Phil Arena and Erik Voeten for some trenchant criticisms.
My FP co-blogger Steve Walt has also weighed in, however, arguing that obsessing about the Sino-American comparison misses some larger points about the decline of American influence:
The United States remains very powerful -- especially when compared with some putative opponents like Iran -- but its capacity to lead security and economic orders in every corner of the world has been diminished by failures in Iraq (and eventually, Afghanistan), by the burden of debt accumulated over the past decade, by the economic melt-down in 2007-2008, and by the emergence of somewhat stronger and independent actors in Brazil, Turkey, India, and elsewhere. One might also point to eroding national infrastructure and an educational system that impresses hardly anyone. Moreover, five decades of misguided policies have badly tarnished America's image in many parts of the world, and especially in the Middle East and Central Asia. The erosion of authoritarian rule in the Arab world will force new governments to pay more attention to popular sentiment -- which is generally hostile to the broad thrust of U.S. policy in the region -- and the United States will be less able to rely on close relations with tame monarchs or military dictators henceforth. If it the United States remains far and away the world's strongest state, its ability to get its way in world affairs is declining.
All this may seem like a hair-splitting, but there's an important issue at stake. Posing the question in the usual way ("Is the U.S. Still #1?", "Who's bigger?", "Is China Catching Up?" etc.,) focuses attention primarily on bilateral comparisons and distracts us from thinking about the broader environment in which both the United States and China will have to operate. The danger, of course, is that repeated assurances that America is still on top will encourage foreign policy mandarins to believe that they can continue to make the same blunders they have in the recent past, and discourage them from making the strategic choices that will preserve U.S. primacy, enhance U.S. influence, and incidentally, produce a healthier society here at home.
I disagree with Steve on multiple points here, so let's be thorough and go through them one at at time.
First, I'd argue that developing accurate assessments about the power balance between China and the United States is actually super-important. Miserceptions about a rising China or a declining United States can lead to a) toxic political rhetoric in Washington, which leads to b) rhetorical blowback, which leads to c) stupid foreign policy miscalculations. As I wrote about a year ago:
Exaggerating Chinese power has consequences. Inside the Beltway, attitudes about American hegemony have shifted from complacency to panic. Fearful politicians representing scared voters have an incentive to scapegoat or lash out against a rising power -- to the detriment of all. Hysteria about Chinese power also provokes confusion and anger in China as Beijing is being asked to accept a burden it is not yet prepared to shoulder. China, after all, ranks 89th in the 2010 U.N. Human Development Index just behind Turkmenistan and the Dominican Republic (the United States is fourth). Treating Beijing as more powerful than it is feeds Chinese bravado and insecurity at the same time. That is almost as dangerous a political cocktail as fear and panic.
The discussion of China in the GOP presidential campaign, as well as Obama's mercantilist State of the Union address, strongly suggest that political assessments and political rhetoric about Chinese power need a strong jolt of sobriety. Walt is concerned that an overestimation of American power will lead to stupid foreign policy decisions, but I'd wager that an overestimation of Chinese power would lead to equally stupid foreign policy decisions.
As for Walt's assertions about the decline of American influence... well, I must take issue with several of them. First, the notion that the United States was able to exercise power more easily during the Cold War seems a bit off. As Robert Kagan points out in The New Republic:
And of course it is true that the United States is not able to get what it wants much of the time. But then it never could. Much of today’s impressions about declining American influence are based on a nostalgic fallacy: that there was once a time when the United States could shape the whole world to suit its desires, and could get other nations to do what it wanted them to do, and, as the political scientist Stephen M. Walt put it, “manage the politics, economics and security arrangements for nearly the entire globe.”
If we are to gauge America’s relative position today, it is important to recognize that this image of the past is an illusion. There never was such a time. We tend to think back on the early years of the Cold War as a moment of complete American global dominance. They were nothing of the sort. The United States did accomplish extraordinary things in that era: the Marshall Plan, the NATO alliance, the United Nations, and the Bretton Woods economic system all shaped the world we know today. Yet for every great achievement in the early Cold War, there was at least one equally monumental setback.
During the Truman years, there was the triumph of the Communist Revolution in China in 1949, which American officials regarded as a disaster for American interests in the region and which did indeed prove costly; if nothing else, it was a major factor in spurring North Korea to attack the South in 1950. But as Dean Acheson concluded, “the ominous result of the civil war in China” had proved “beyond the control of the ... United States,” the product of “forces which this country tried to influence but could not.” A year later came the unanticipated and unprepared-for North Korean attack on South Korea, and America’s intervention, which, after more than 35,000 American dead and almost 100,000 wounded, left the situation almost exactly as it had been before the war. In 1949, there came perhaps the worst news of all: the Soviet acquisition of the atomic bomb and the end of the nuclear monopoly on which American military strategy and defense budgeting had been predicated.
Kagan's essay is getting some attention in high places, so I'll be very curious to hear Walt's take on it.
It Walt overestimates America's influence during the Cold War, he also underestimates American influence now. The funny thing about the "stronger and independent actors in Brazil, Turkey, India, and elsewhere" is that they're siding with the United States on multiple important issues. Coordination between Turkey and the United States on the Arab Spring has increased over time, and their policy positions on Iran are converging more than diverging. Brazil has turned a cold shoulder to Iran and has been warier about China's currency manipulation and rising influence in Latin America. India seems perfectly comfortable to be a partner in America's Pacific Rim pivot, as are Australia, Japan and South Korea.
This is perfectly consistent with Walt's own balance-of-threat theory, by the way. The actors that seem to be generating the most anxiety among the rising developing countries are the ones that seem to be exhibiting the most aggressive regional intentions -- namely, China and Iran. Indeed, even countries with strong historical resentments against the United States are now trying to find creative ways to bind themselves to Washington. Will these countries always march in lockstep with the United States? Of course not -- but as Walt would surely acknowledge, America's NATO allies were not always on the same page with the United States on myriad Cold War issues.
It seems that Walt's primary concern is that without better domestic policies, the United States might fritter away its great power advantages. I'm sympathetic to that argument -- I'd also take the bold position that I'd like to see improvements in American education and infrastructure as well. One of the points I was making in my original post, however was that even absent grand initiatives from Washington, the United States economy was finding ways to heal itself. Indeed, compared to either Europe or China, one could argue that the United States has adjusted to the post-2008 environment the best. This is not so much praise for Washington as an indictment of rigidities in Brussels and Beijing. Still, power and influence are relative measures, and I see little evidence to support Walt's pessimism.
Am I missing anything?
Let's face it, there's a general anxiety about the future of America. There's Tom Friedman's column today, which my doctors have now forbade me from critiquing in order to keep my blood pressure down. Books suggesting the United States is kowtowing to China are forthcoming. The Economist recently observed on the highlights of a sobering survey of Harvard Business School graduates, which contained the following:
Fully 71% of the businesspeople polled expected America’s competitiveness to decline over the next three years. (National competitiveness is a slippery concept: countries do not compete in the same way that firms do. But the businessfolk in question answered some clearer questions, too.) Some 45% said that American firms will find it harder to compete in the global economy. A startling 64% said that American firms will find it harder to pay high wages and benefits.
Intriguingly, the Harvard alumni were gloomy about where America is headed, rather than how it is now. Some 57% felt that today the business environment in America is somewhat or much better than the global average; only 15% said it was worse. But when asked to compare its prospects with those of other industrialised economies, only 9% felt that America was pulling ahead; some 21% said it was falling behind. A striking 66% expected America to lose ground to Brazil, India and China; only 8% thought it would pull away from them.
This would seem to jibe with popular laments about why Apple can't make its products domestically. There are a lot of reasons, but a significant one is the lack of necessary skills for higher-end manufacturing. This is in no small part because American students shy away from the training necessary to do these kind of jobs even if they originally think they want to be engineers. Why? Because American college students don't like doing homework.
So, America is doomed, right?
To be honest, this sounds like a lot of pious baloney. As Michael Beckley points out in a new article in International Security, "The United States is not in decline; in fact, it is now wealthier, more innovative, and more militarily powerful compared to China than it was in 1991." The whole article is worth a read, and a good cautionary tale on the dangers of overestimating the ease of national catch-up:
The widespread misperception that China is catching up to the United States stems from a number of analytical flaws, the most common of which is the tendency to draw conclusions about the U.S.-China power balance from data that compare China only to its former self. For example, many studies note that the growth rates of China’s per capita income, value added in hightechnology industries, and military spending exceed those of the United States and then conclude that China is catching up. This focus on growth rates, however, obscures China’s decline relative to the United States in all of these categories. China’s growth rates are high because its starting point was low. China is rising, but it is not catching up.
What about the future? One could point to the last few months of modestly encouraging economic data, but that's ephemeral. Rather, there are three macrotrends that are worth observing now before (I suspect) they come up in the State of the Union:
1) The United States is successfully deleveraging. As the McKinsey Global Institute notes, the United States is actually doing a relatively good job of slimming down total debt -- i.e., consumer, investor and public debt combined. Sure, public debt has exploded, but as MGI points out, that really is the proper way of doing things after a financial bubble:
The deleveraging processes in Sweden and Finland in the 1990s offer relevant lessons today. Both endured credit bubbles and collapses, followed by recession, debt reduction, and eventually a return to robust economic growth. Their experiences and other historical examples show two distinct phases of deleveraging. In the first phase, lasting several years, households, corporations, and financial institutions reduce debt significantly. While this happens, economic growth is negative or minimal and government debt rises. In the second phase of deleveraging, GDP growth rebounds and then government debt is gradually reduced over many years....
As of January 2012, the United States is most closely following the Nordic path towards deleveraging. Debt in the financial sector has fallen back to levels last seen in 2000, before the credit bubble, and the ratio of corporate debt relative to GDP has also fallen. US households have made more progress in debt reduction than other countries, and may have roughly two more years before returning to sustainable levels of debt.
Indeed, the deleveraging is impressive enough for even Paul Krugman to start sounding optimistic:
the economy is depressed, in large part, because of the housing bust, which immediately suggests the possibility of a virtuous circle: an improving economy leads to a surge in home purchases, which leads to more construction, which strengthens the economy further, and so on. And if you squint hard at recent data, it looks as if something like that may be starting: home sales are up, unemployment claims are down, and builders’ confidence is rising.
Furthermore, the chances for a virtuous circle have been rising, because we’ve made significant progress on the debt front.
2) Manufacturing is on the mend. Another positive trend, contra the Harvard Business School and the GOP presidential candidates, is in manufacturing. Some analysts have already predicted a revival in that sector, and now the data appears to be backing up that prediction. The Financial Times' Ed Crooks notes:
Plenty of economists and business leaders believe that US manufacturing is entering an upturn that is not just a bounce-back after the recession, but a sign of a longer-term structural improvement. Manufacturing employment has grown faster in the US since the recession than in any other leading developed economy, according to official figures. Productivity growth, subdued wages, the steady decline in the dollar since 2002 and rapid pay inflation in emerging economies have combined to make the US a more attractive location.
“Over the past decade, the US has had some huge gains in productivity, and we have seen unit labour costs actually falling,” says Chad Moutray, chief economist at the National Association of Manufacturers. “A lot of our members tell us that it sometimes is cheaper to produce in the US, especially because labour costs are lower.”
Now, whether this boom in manufacturing will lead to a corresponding boom in manufacturing employment is much more debatable. Still, as The Atlantic's Adam Davidson concludes: "the still-unfolding story of manufacturing’s transformation is, in many respects, that of our economic age. It’s a story with much good news for the nation as a whole. But it’s also one that is decidedly less inclusive than the story of the 20th century."
Growth in shale oil and gas supplies will make the US virtually self-sufficient in energy by 2030, according to a BP report published on Wednesday.
In a development with enormous geopolitical implications, the country's dependence on oil imports from potentially volatile countries in the Middle East and elsewhere would disappear, BP said, although Britain and western Europe would still need Gulf supplies.
BP's latest energy outlook forecasts a growth in unconventional energy sources, "including US shale oil and gas, Canadian oil sands and Brazilian deepwater, plus a gradual decline in demand, that would see [North America] become almost totally energy self-sufficient" in two decades.
BP's chief executive, Bob Dudley, said: "Our report challenges some long-held beliefs. Significant changes in US supply-and-demand prospects, for example, highlight the likelihood that import dependence in what is today's largest energy importer will decline substantially."
The report said the volume of oil imports in the US would fall below 1990s levels, largely due to rising domestic shale oil production and ethanol replacing crude. The US would also become a net exporter of natural gas.
Note that this will take a while, and doesn't mean that the U.S. will be energy independent. Still, it's quite a trend. Or, rather, trends.
Since the Second World War, the pattern in the global political economy has been for the United States to adjust to systemic shocks better than any potential challenger country. A lot of very smart people have predicted that this time was different -- the United States wouldn't be able to do it again. These trends suggest that maybe, just maybe, that might be wrong.
Am I missing anything?
The past decade's worth of American foreign policy debacles has led to some lazy thinking on American empire. Either the United States is using force to advance rapacious economic interests, or Washington is neglecting economic diplomacy because U.S. foreign policy has become too militarized. Right, now, neither argument holds up terribly well.
For example, the Financial Times' Lina Saigol looks at postwar foreign direct investment in Iraq and notes the prominent absence of U.S. and British firms:
After almost nine years, $1tn spent and 4,487 American and 179 British lives lost, theUS is withdrawing from Iraq, leaving the country’s vast economic spoils to nations that neither supported nor participated in the US-led invasion that toppled Saddam Hussein.
Turkey, Iran, China, South Korea and Arab states have already invested billions in Iraq, far outpacing their US and UK counterparts in every non-oil sector from transport and telecoms to housing and construction.
This is really a variation of a theme. Take a look at Afghanistan, and the same pattern plays itself out -- significant U.S. military investment, remarkably little follow-on U.S. economic investment, significant investments by others. In short, arguments that the United States uses its military power to advance its economic interests don't hold up well at all -- unless one wants to posit that U.S. elites are really an executive committee of the Chinese Communist Party's economic bourgeoisie.
The overmephasis on military force has been a long-running criticism of American foreign policy. That said, it leads to some lazy analytical habits. Consider this NYT Sunday Review essay by Stephen Glain on the U.S. "pivot" to the Pacific Rim:
With the economy in disarray, President Obama chose a costly instrument in deciding to expand the American military commitment in Asia by deploying a Marine contingent to Australia; the move will only help insulate the Pentagon from meaningful spending cuts and preserve the leading role the military has played in foreign policy since the 9/11 attacks....
Indeed, America’s top diplomat has become the chief civilian advocate for military answers to diplomatic challenges. Speaking in Honolulu last month, Secretary of State Hillary Rodham Clinton called for “a more broadly distributed military presence” in Asia. While in Manila, she appeared on an American warship and reaffirmed the nearly 60-year-old security pact between the United States and the Philippines. She also has endorsed the creation of an American-led regional trade pact that pointedly excludes China for the present, a remarkably petty snub compared to the way her legendary predecessor George C. Marshall offered (without success, in the face of Stalin’s suspicions) to include the Soviet Union in the postwar reconstruction plan that now bears Marshall’s name. And this month she visited Myanmar, where the Obama administration has assiduously worked to neutralize a corrupt and repressive government in favor of democratic reform; in the grander strategic game, this, too, could be read in Beijing as a tactic to weave the country — which has been Beijing’s ally — into an American noose around China.
OK, this argument is confusing on a number of fronts. First, how is ratifying an FTA with South Korea and negotiating a framework agreement on the Trans-Pacific Partnership an example of an excessive role for the military?
Second, President Obama was quite explicit in saying he would welcome Chinese participation in TPP. However -- like Marshall before him -- Obama is saying this because he's pretty sure China will be unwilling to pay the regulatory coin necessary to join.
During the 1990's, one could argue that U.S. foreign policy in the Pacific Rim was too heavily dominated by the Treasury Department. During the 2000's, one could argue that it was too heavily dominated by the Defense Department. Right now, U.S. policy in the region looks like a decent balance of security and economic diplomacy. I suspect that this balance has been so rare for so long that analysts simply aren't used to recognizing it.
Over at The Atlantic, Max Fisher argues that the age of American client states is coming to an end:
The fall of easily controlled dictators across the region (the U.S. has already given up on its man in Yemen) comes at the same time as U.S.-allied democracies and autocracies alike seem increasingly willing to buck Washington's wishes. Last week alone, the U.S. clashed with some of its most important client states. Maybe that's because of America's habit of picking the most troubled states in the most troubled regions as clients (where they're perceived as the most needed), maybe it's because democratic movements are pressuring client states to follow popular domestic will rather than foreign guidance, and maybe it's because the idea of clientalism was doomed from the start....
Whatever the reasons, U.S. client states have been causing Washington more headaches than normal this year, and particularly over the past week. Here are ten of the most closely held U.S. clients, measured in part by foreign assistance (scheduled for fiscal year 2012) and by number of U.S. troops stationed there (according to Department of Defense statistics). Each is labeled with the reason for their strategic importance and with a rough gauge of how much trouble it's been causing the U.S., rated on a scale from "Zero Problems" to "Migraines in Washington." The most extreme cases are labeled "Client Relationship at Risk." Looking over the list of troubled client relationships, it's easy to wonder if the entire Cold War-inspired enterprise could be nearing its end. Maybe Egypt, just as it helped end the centuries of European imperialism in 1956, could make 2011 the year that began the end of clientalism.
Fisher makes an interesting point, but if you look at his list, there's a pretty obvious pattern: the client states causing actual headaches in Washington are in the Greater Middle East. Fisher's examples from Latin America and the Pacific Rim -- Colombia, South Korea and Taiwan -- are relationships that are actually deepening rather than fraying. These also happen to be the most democratic countries on Fisher's list.
The deeper question is whether the trouble with clients is a uniquely American problem, a uniquely Middle East problem, or a more general phenomenon of client-patron relationships. This is really the bailiwick of Dan Nexon, and I expect he'll weigh in on this question soon. Based on China's difficulties with North Korea and the Middle East, I'm inclined to think it's a general phenomenon, however.
I don't know how much God has to do to get the attention of the politicians. We've had an earthquake; we've had a hurricane. He said, 'Are you going to start listening to me here?' Listen to the American people because the American people are roaring right now. They know government is on a morbid obesity diet and we've got to rein in the spending.
An interesting hypothesis!! So, there are three possibilities here. The first is that Bachmann was joking -- in which case, wow, that's a really tasteless joke given the loss of life and probably warrants a pretty big apology.
The second is that Bachmann is simply
nuts wrong. Doug Mataconis points out,
I’m not sure how this computes given the fact that the storm largely spared Washington, D.C. and New York, while hammering a red states like North Carolina and a heavily Republican area like Virginia’s Tidewater region.
Well, socialist-supporting Vermont got hit pretty hard too, but still, this is a fair point, and "Bachmann being wrong" seems like another safe bet.
The third possibility is the one I want to explore, however -- what if Bachmann is right? What if God really is using wrath to coerce humanity into implementing a particular set of policy preferences?
A God-fearing person would naturally decide to obey. However, this kind of coercive demand strikes me as a pretty massive intrusion into human sovereignty. The point of a democracy is for majorities of citizens and their elected representatives to decide matters of policy. Recent history suggests that neither sovereign governments nor their populations take kindly to coercive threats from other men. If we acquiesce to Divine demands now, don't we just let God win?
Bachmann's response suggests an obvious bandwagoning approach to the awesome power of deities: When God says jump, you should say, how high? And, indeed, if the Almighty really is omnipotent, this strategy has much to recommend it. Bandwagoning is generally recommended when the targeted actor is comparatively weak, has few natural allies, and believes that the targeting actor can be appeased with concessions. This seems to fit the Old Testament, monotheistic God to a tee.
On the other hand, however, might a balancing approach yield better long-term results? After all, God has a disturbing track record of making demands like this. We know from
Genesis the Old Testament that the Almighty has a tendency to, well, you know, smite humans on a semi-regular basis. There's the flood, Sodom and Gomorrah, an awful lot of Egyptians, etc. This doesn't even include the number of times God demanded death (the sacrifice of Isaac, Ninevah) only to relent at the last minute. Sure, God has some good reasons in some of these instances, but from a threat assessment perspective, it's veeeeery disturbing.
Maybe the bandwagoning criteria don't apply. If one operates along the monotheistic assumption*, humans should ask if there is a possible ally out there to help resist God's will [Don't go there --ed.], an entity who is God's enduring rival [You're really going there, aren't you?! --ed.] , one who might have the necessary power to make God think twice about all that smiting?
It's time to wonder … would a temporary alliance with Satan really be that bad? [Yes it world!! --ed.] Winston Churchill once said, "If Hitler invaded hell I would make at least a favorable reference to the devil in the House of Commons." Now I'm not sure I would even go that far … the whole selling souls thing sounds like a pretty big demand too. That said, a sober, realpolitik perspective would demand that making a deal with the devil has to be a policy option that stays on the table.
[How about a nice buck-passing strategy instead?--ed. Hey, I'd love to just force other creatures like, say, apes to go toe-to-toe with God, but I just don't see it happening.]
Readers are warmly encouraged to puzzle this out for themselves -- or, instead, to buy the very entertaining Biblical Games by Steven Brams.
*The monotheism assumption is important when thinking about how to cope with a venegeful god. If the universe turns out to be polytheistic, then the question becomes whether us mortals can sow dissension among the gods before someone releases a Kraken.
Over at Vanity Fair, James Wolcott blogs about the explosion of forthcoming superhero movies, why they will suck, and what this means for American exceptionalism.
Actually, let me put that a little differently: James Wolcott has used prose more bloated than X-Men 3 to attempt a half-assed connection between summer popcorn flicks and America's place in the world.
First, there's his general critique of today's superhero film:
For old-school comic fans such as myself (who had a letter published in the Stan Lee-Jack Kirby Fantastic Four in 1967—top that, Jonathan Franzen), these cinematic blowup editions are lacking on the fun side. The more ambitious ones aren’t meant to be much fun, apart from a finely crafted quip surgically inserted here and there to defuse the tension of everybody standing around butt-clenched and battle-ready, waiting for some laureled thespian (Anthony Hopkins as Odin in Thor) to elocute and class up this clambake. Even the films that play it loosey-goosier, such as the facetious Ghost Rider (Nicolas Cage as a skull-blazing vigilante who chills by listening to the Carpenters), end up laying it on too heavy, faking orgasm like a porn star trying to keep Charlie Sheen’s attention. For all of the tremendous talent involved and the technical ingenuity deployed, superhero movies go at us like death metal: loud, anthemic, convoluted, technocratic, agonistic, fireball-blossoming, scenery-crushing workloads that waterboard the audience with digital effects, World War IV weaponry, rampant destruction, and electrical-flash editing.
Three thoughts. First, this critique ain't exactly new. Second, the reason this critique isn't new is that Wolcott ignores
Drezner's Sturgeon's Law of Crap. Take any artistic or literary category, and 90% of the contributions to said genre will be total crap [Does that apply to your blog posts as well?--ed. More like 95% in my case.] Therefore, the easiest thing in the world to blog about is how 90% of any kind of genre stinks. Third, Wolcott clearly slept through hasn't seen the superhero films that rise above the 90% and possess a fair degree of whimsy, like, say, Spiderman 2, The Incredibles, or Iron Man.
As for the symbolic implications for American power, er, well, here's his key paragraph:
Why so much overcompensation? The superhero genre is an American creation, like jazz and stripper poles, exemplifying American ideals, American know-how, and American might, a mating of magical thinking and the right stuff. But in the new millennium no amount of nationally puffing ourselves up can disguise the entropy and molt. Despite the resolute jaw of Mitt Romney and John Bolton’s mustache, American exceptionalism no longer commands the eagle wingspan to engirdle the world and keep raising the flag over Iwo Jima. Since Vietnam, whatever the bravery and sacrifice of those in uniform, America’s superpower might hasn’t been up to much worthy of chest-swelling, chain-snapping pride (invading a third-rate military matchstick house such as Iraq is hardly the stuff of Homeric legend), and our national sense of inviolability took a sucker punch on September 11, 2001, that dislocated our inner gyroscope. Sinister arch-villains make for high-stakes showdowns, but asymmetrical conflict has no need for them, and for all we know the cavern voice of Osama bin Laden could be a Mission: Impossible tape, poofing into smoke at the first shaft of sunlight. The subsequent War on Terror is one waged within a shadow maze of misdirection and paranoia where the enemy might be no more than a phantom army of apprehensions, viral bugs invading the neural network.
Let me be blunt -- I'm not entirely sure if Wolcott wrote this paragraph or outsourced it to a computer program that strongs together random clauses about American foreign policy. Suffice it to say that the better superhero flicks -- both Iron Man and The Dark Knight Returns come to mind -- contain some interesting commentary on American foreign policy. Indeed, a few years ago Jesse Walker at Reason argued, with some justification, that "Superhero stories may have begun as power fantasies, but it is our ambivalence about power that keeps the modern genre thriving."
I share Wolcott's distaste for hackneyed comic book films, but sometimes, a bad movie is just a bad movie. Anyone trying to use
any film released in January The Green Hornet as a metaphor for what ails American foreign policy really needs to remember that, most of the time, a bad superhero movie is just a bad superhero movie.
While I was obsessing about Egypt last week, I see that John Quiggin, William Winecoff and others have been having a rollicking debate about the status of American hegemony, the fungibility of military power, and Boeing/Airbus subsidies. OK, that last one is less interesting, but I strongly encourage readers to go through the comment thread to that blog post.
Essentially, Quiggin contends that:
[T]he decline of the US from its 1945 position of global pre-eminence has already happened. The US is now a fairly typical advanced/developed country, distinguished primarily by its large population.
Ergo, other large market jurisdictions, like the European Union, are equal to the U.S. in terms of relative power.
This cheesed off Winecoff and others into pointing out the myriad ways in which the U.S. power profile is a) still outsized; and b) largely shaped the current global order we live in; and c) allowed entities like the EU to focus on welfare maximization rather than security.
Dan Nexon, in a comment to Quiggin's last rejoinder, gets at one nub of the debate:
John’s pointing out, quite rightly, that military power isn’t necessarily fungible. He’s doing so in the context of economic and regulatory power, which is the most “multipolar” dimension of global power right now. His IR critics are pointing out that the US still has outsized influence across a number of domains, and that some of those domains involve international (economic) institutions. They’re both onto something.
I pretty much agree with Dan here. In the military sphere, the U.S. remains a hegemonic power. In the economic and regulatory realms, well, I wrote a whole book arguing that until recently we lived in a bipolar world, so I'll side with Quiggin on that score.
There's something missing from this debate that is worth raising, however -- a proper definition of power. For example, in his first post, Quiggin noted that "[advanced industrialized countries] might be said to have declined in relative terms. But this doesn’t seem to me to constitute 'decline' in any important sense." This is heresy to an international relations scholar, in that power is viewed as a zero-sum commodity.
Beyond that, however, it is useful to think about the power to deter change from the status quo vs, the power to compel change in the status quo. In a deterrence scenario, countries use their capabilities to ward off pressure from other actors, or from structural pressures. In a compellence scenario, a powerful government threatens to use statecraft to extract concessions from other actors, or use power to alter the rules of the global game.
Deterring pressure by others is different than applying such pressure to others. With military or economic statecraft, it is generally easier to defend than attack. Many IR scholars argue that the ability to deter is a necessary condition of the power to compel. Only after an actor has the ability to resist pressure from others will they contemplate whether they can be the actor to generate pressure. Countries possessing sufficient reservoirs of power should therefore have both greater autonomy of action and be better placed to apply pressure on other actors.
What the past few years have demonstrated is the relative decline of U.S. compellence power and the rise of other countries deterrence power. Certainly the recent uses of U.S. military force haven't yielded the expected results. In the economic realm, countries like India and Brazil can veto WTO negotiation rounds in a way that simply wasn't possible 15 years ago. Similarly, China can resist U.S. jawboning on its exchange rate policy far more than in the past.
On the other hand, neither U.S. deterrent power nor other countries' compellence power has changed all that much, even in the economic realm. The rest of the G-20 can scream as loud as they want, but quantitative easing is going to continue. China has tried to find ways to use its newly found financial muscle to force changes in the international system, to little avail. To be sure, Russia, China and others can compel countries on their immediate periphery, but even a glance at the 2008 Russian-Georgian war suggests that even modest efforts like these are expensive and messy.
So... we live in a world in which more actors have vetoes over systemic change but no actor has the ability to truly compel change. This leads to lots of talk about "G-zero worlds" and so forth.
Just to be provocative, however, I wonder if what's truly changed is the extinction of compellence power as we know it. The primary, ne plus ultra tools of compellence require a willingness to kill, jail or starve a lot of people. Recent flare-ups like Iran in 2009 and Egypt right now suggests that such actions are possible at the domestic level, but pretty damn costly; even authoritarian countries flinch at using brute force on a domestic population. Cross-border efforts are even more expensive in terms of both material and reputational costs.
This isn't the end of power, but it might be the end of one particular dimension of power. I'm not entirely convinced that this supposition is true, and am willing/eager to hear counterarguments. That said, I still hereby claim The End of Power as my title, so everyone else just back off, OK?
More seriously, am I missing anything?
Your humble blogger has been
negligent remiss in not discussing the developing situation in the Ivory Coast. As near as I can figure, the state of play is as follows:
1) There was a presidential election last November
2) Everyone and their mother recognizes that Alassane Ouattara defeated current ruler Laurent Gbagbo... except for Gbagbo.
3) Ouattara is now holed up in the Hotel du Golf under the protection of UN peacekeepers and private security forces. Despite mounting pressure from the United States, European Union, United Nations, and Ecowas, Gbagbo is acting like he ain't going anywhere.
Now we have this BBC report:
The UN-recognised president-elect of Ivory Coast has called for a West African special forces operation to remove incumbent leader Laurent Gbagbo.
Alassane Ouattara's administration says the time for discussion with Mr Gbagbo, who is refusing to step down following November's election, is over.
The West African regional body Ecowas has threatened to force Mr Gbagbo out, but is trying mediation efforts first....
Mr Ouattara, who has many supporters in northern Ivory Coast, said it was just a question of removing Mr Gbagbo from power and taking control of key buildings like the presidential palace.
"Legitimate force doesn't mean a force against Ivorians," Mr Ouattara told reporters on Thursday, AFP news agency reports.
"It's a force to remove Laurent Gbagbo and that's been done elsewhere, in Africa and in Latin America, there are non-violent special operations which allow simply to take the unwanted person and take him elsewhere."
However, Ecowas does not have the sophisticated equipment and personnel needed for a special forces operation, our reporter says.
This raises a somewhat awkward question -- could this be one of those cases where neoconservatives have a valid point about the use of force? The past decade of U.S. military misadventures has clearly dulled the appetite for new military missions among the mass public, most of the foreign policy community and, well, me. That said, this could be one of those cases when unilateral U.S. force might be the best available policy option. [But what about ECOWAS?--ed. Sure, if they could gear up, that would be even better. As the BBC suggests, however, it's not clear that they have the capability to do so.]
Note my stress on the word "could" in that last sentence -- the Ivory Coast has been wracked by civil conflict during this past decade and U.S. action could just make things worse. But I'm not sure about that assertion either.
What do you think?
My post yesterday on
following Vizzini's advice U.S. retrenchment from Central Asia generated a bit of pushback. I should point out that my concern here is that the U.S. husbands its power resources with a bit more acumen. Sure, Central Asia has some strategic significance, but the thing is, every region in the globe has some strategic significance. If I'm rank-ordering U.S. strategic priorities, it would go as follows: 1) East Asia; 2) Latin America; 3) Europe; 4) Middle East; 5) South Asia; 6) Central Asia; 7) Africa (there's also a big gap between 4 and 5 on this list). Scarce resources devoted to Central Asia have to be siphoned from somewhere, and I don't want too much of a diversion from other strategic priorities.
That said, I want to clarify that I'm not saying that the U.S. is in terminal decline and therefore should engage in a systematic strategic retreat. David Bell makes an excellent point in The New Republic today -- there has been a perpetual declinism industry in the United States since the launch of Sputnik.
Twenty-two years ago, in a refreshingly clear-sighted article for Foreign Affairs, Harvard's Samuel P. Huntington noted that the theme of "America's decline" had in fact been a constant in American culture and politics since at least the late 1950s. It had come, he wrote, in several distinct waves: in reaction to the Soviet Union's launch of Sputnik; to the Vietnam War; to the oil shock of 1973; to Soviet aggression in the late 1970s; and to the general unease that accompanied the end of the Cold War. Since Huntington wrote, we can add at least two more waves: in reaction to 9/11, and to the current "Great Recession."....
What the long history of American "declinism" -- as opposed to America's actual possible decline -- suggests is that these anxieties have an existence of their own that is quite distinct from the actual geopolitical position of our country; that they arise as much from something deeply rooted in the collective psyche of our chattering classes as from sober political and economic analyses.
For whatever reason, it is clear that for more than half a century, many of America's leading commentators have had a powerful impulse consistently to see the United States as a weak, "bred out" basket case that will fall to stronger rivals as inevitably as Rome fell to the barbarians, or France to Henry V at Agincourt.
On the foreign policy front, selective U.S. retrenchment doesn't imply terminal decline so much as a temporary realignment to ensure that American power and interest are matched up going forward.
Question to readers: does retrenchment presage resurgence?
Anne Applebaum points out an interesting conundrum for U.S. foreign policy:
[W]e are left with a curious situation: America no longer wants to be the sole superpower. The American president no longer wants to be the leader of a sole superpower. Nobody else wants America to be the sole superpower, and, in fact, America cannot even afford to be the sole superpower. Yet America has no obvious partner with which to share its superpowerdom, and if America were to cease being a superpower, nothing and no one would take its place.
This might not be the end of the world—there are quite a few trouble spots that could do with a long period of benign neglect—and it might not last forever. Europe, when counted as a single entity, is still the world's largest economy. China, whatever else it might be, is still the world's fastest-growing economy. Sooner or later, the simple need to defend their economic interests might persuade one or both to start taking the outside world more seriously.
This does mean that the Obama administration has a problem, however: Having come to office promising to work with allies, it may soon discover that there are no allies with which to work.
One could argue that this is the downside of path dependence. The United States enjoys many perquisites of power because the U.S. has been the hegemonic power for so long that everyone else expects the U.S. to continue as the lone superpower.
The plus side of this convergence in expectations is that U.S. leadership of the international system is by and large accepted. Of course, leaders are useless without followers, so this is more about the appearance of power than power itself.
The down side of this arrangement is that the United States gets blamed when global public goods are not provided -- even if the United States is largely blameless.
Applebaum goes on to suggest that thw U.S. should reconsider the unilateralism of a few years ago. Actually, I wonder if the U.S. shouldn't go in the opposite direction. The current problem is one of free-riding -- rising powers assume the United States will shoulder a disproportionate burden in msnaging the international system. If the U.S. was prepared to weather the effects of non-cooperation, a retrenchment strategy eliminates the "moral hazard" issue that blunts the incentive for rising powers to share the burden.
Of course, I'm not convinced of this -- I'm just wondering. It is entirely possible that countries like China are perfectly prepared to shoulder a greater burden -- they just have a different set of preferences than the United States. Or, it could be both.
Question to readers: do you think the Obama administration should follow Applebaum's advice?
My latest column at The National Interest online is now available. It takes a closer look at the mismatch between domestic and foreign expectations of American hegemony. I also throw in some international relations theory:
While the Obama administration and the American people might be content with the notion of America as just another country, this sentiment raises some uncomfortable questions. There is the factual one: is America really just one of many nations? Despite everything that has befallen the United States during this decade, the fact remains that by standard metrics—GDP, military might, cultural attraction—the United States is far and away the most powerful country in the world. This fact is so glaring that even academics are starting to acknowledge it. Stephen Brooks and William Wohlforth wrote an entire book on the durability of American unipolarity. World Politics published a special issue this year on the nature of the unipolar era.
Go check it out!
Hmmmm.... let's see what is on the commentary page of the World section of the Financial Times website. See if you can spot the trend:
You'll have to read it to see why.
One could be excused for thinking, in this kind of news environment, that Beijing is literally taking over the world. Some perspective is useful, however. There is no question that China is trying to turn this crisis into a series of opportunities. There is a question, however, whether these opportunities will actually be realized....
Let’s be clear—China is clearly on the rise, and they will be punching their weight more frequently in venues like the G-20, the U.N. Security Council and Asian regional forums. Greater activity does not always equal greater influence, however. So if you read that China is taking over the world, take a deep breath and relax.
Three months ago I blogged that the World Bank's growth projections for this year were too optimistic. Let's review my reasons:
- Credit markets have yet to really unfreeze, because the underlying problem -- putting a price on a lot of toxic debt -- has yet to take place;
- It's going to take some time for trust -- a vital public good -- to return to global capital markets;
- The crisis has done nothing to unwind the global macroeconomic imbalances that contributed to the asset bubble in the first place -- if anything, the crisis has temporarily reinforced it;
- There is a very dangerous prisoner's dilemma game brewing in the interplay of fiscal expansion and trade policy. Unless export engines like Germany start to signal that they'll prime their pump as well, you're going to start to see some nasty protectionist attachments to any new government spending;
- Fiscal expansions are going to take a long time to kick in, and the ones being proposed are not necessarily conducive to countercyclical boosts.
- Beyond the fiscal expansion, this crisis is going to result in a lot more state intervention in the economy. Given what's happened, it would be intellectually dishonest of me not to acknowledge that some of this intervention will be necessary. A lot of it, however, is going to be misguided and stunt long-term growth.
I would be very surprised if global growth was not negative in 2009.
With the very partial exception of no. 5, all of the other factors are still very, very present in the global economy.
And, alas, it now appears that the Bank has caught up with my doom and gloom.
Developing countries face a financing shortfall of $270-700 billion this year, as private sector creditors shun emerging markets, and only one quarter of the most vulnerable countries have the resources to prevent a rise in poverty, the World Bank said....
The global economy is likely to shrink this year for the first time since World War Two, with growth at least 5 percentage points below potential. World Bank forecasts show that global industrial production by the middle of 2009 could be as much as 15 percent lower than levels in 2008. World trade is on track in 2009 to record its largest decline in 80 years, with the sharpest losses in East Asia.
The financial crisis will have long-term implications for developing countries. Debt issuance by high-income countries is set to increase dramatically, crowding out many developing country borrowers, both private and public. Many institutions that have provided financial intermediation for developing country clients have virtually disappeared. Developing countries that can still access financial markets face higher borrowing costs, and lower capital flows, leading to weaker investment and slower growth in the future.
There's something else going on that should bother IR scholars. One of the benefits of having a hegemon is supposed to be greater provision of global public goods. According to hegemonic stability theory, if the United States is really still the hegemon, then it should be providing the following things:
The U.S. did all of these things during the Asian financial crisis, for example.
This time around, the U.S. grade is not as high. There has certainly been provisions of liquidity -- though if one defines the start of this crisis as the fall o 2007, then it's not like LIBOR has fallen to pre-crisis levels.
The U.S. is not a market for distressed goods. On the margins this is due to incipient protectionism, but mostly this is due to the U.S. economic contraction. Indeed, this is why the recession has so deeply affected Pacific Rim exporters.
The worst grade, however, is on counter-cyclical lending. As the New York Times' Peter Goodman writes:
American investors are ditching foreign ventures and bringing their dollars home, entrusting them to the supposed bedrock safety of United States government bonds. And China continues to buy staggering quantities of American debt.
These actions are lifting the value of the dollar and providing the Obama administration with a crucial infusion of financing as it directs trillions of dollars toward rescuing banks and stimulating the economy, enabling the government to pay for these efforts without lifting interest rates.
And yet in a global economy crippled by a lack of confidence and capital, with lending and investment mechanisms dysfunctional from Milan to Manila, the tilt of money toward the United States appears to be exacerbating the crisis elsewhere.
The pursuit of capital suddenly seems like a zero sum game. A dollar invested by foreign central banks and investors in American government bonds is a dollar that is not available to Eastern European countries desperately seeking to refinance debt. It is a dollar that cannot reach Africa, where many countries are struggling with the loss of aid and foreign investment.
Developing.... in a very, very bad way.
In effect, the US central bank is taking care of the dollar liquidity needs of these four emerging economies, leaving the IMF to take care of the rest. International officials believe that the European Central Bank may also take some responsibility for providing further support for vulnerable economies in Europe, including potential members of the eurozone, along with the IMF. The Fed is providing its support to Mexico, Brazil, South Korea and Singapore via currency swaps on essentially the same terms as those offered to the 10 industrialised economies with which it already has reciprocal currency arrangements, including the eurozone, UK and Japan. These are much more generous than the terms on which the US government and multilateral institutions lent money to developing countries during emerging market crises, for instance in the 1990s. In today’s operations the Fed simply lends dollars to the local central bank, and the local central bank lends the dollars on to local banks. The Fed takes the counterparty credit risk of the central bank on the other side of the swap, with collateral in the form of an equivalent amount in local currency. There are no policy conditions.... It worried that the IMF might not have enough resources to support all the emerging economies that might need dollars. The Fund’s total lending capacity is about $250bn. The Fed swaps supplement this with an extra $120bn for Brazil, Mexico, South Korea and Singapore alone. The Fed hopes the Fund’s resources will be enough to deal with the remaining needs of the emerging economies.Meanwhile, the IMF also announced the creation of a new credit facility: The geopolitical implications of these moves are pretty surprising to Brad Setser:
[I]t has been fashionable to argue that the crisis would increase China’s financial influence — as China sits on a ton of foreign exchange and potentially offered an alternative source of foreign currency liquidity. Indeed, China seems keen on doing a deal with Russia that would help Russian state-owned energy firms raise foreign exchange to help cover their maturing external debts — and the in the process, help reduce the drain on the government of Russia’s foreign exchange reserves. But so far the crisis hasn’t had that effect — in part because the US and Europe have moved quickly (by the standards of governments) to help a broad range of countries meet their foreign currency needs. That was driven first and foremost by the needs of the emerging economies — and the ripple effect their deepening trouble would have on the US and Europe. But I wonder if the possibility that institutions like the IMF could be bypassed if they didn’t respond more quickly and creatively than in the past didn’t help to spur the recent set of policy changes. Those in the IMF’s Executive Board who normally would object to unconditional lending didn’t block the new short-term lending facility — perhaps at least in part because of recognition that the IMF potentially isn’t the only game in town (or in the world). China’s rise, in effect, contributed to the a change in the political climate that helped to lift some of the political constraints that in the past limited the IMF’s scope. I certainly didn’t anticipate this. Three months ago I was among those thinking that the rise of the emerging world’s reserves would reduce the IMF’s future relevance.I agree with Brad that the presence of alternative sources of financing could explain why the Fund and the G-7 have moved so quickly. There's something else going on, however -- China is moving very, very slowly. They've already had opportunities to provide alternative sources of financing and declined. Indeed, for all the bluster about countries like Iceland and Pakistan working around the IMF, in the end they've needed both Fund capital and the Fund imprimatur in order to get access to liquidity. One could argue that these are countries more inclined to ally with the West, but that doesn't really hold true for Pakistan -- and it certainly doesn't hold true for Belarus. So what's going on? I don't know yet -- but my hunch is that there are two things driving this curious inaction:
President George W. Bush on Saturday announced his intention to host a summit of world leaders to deal with the financial crisis that has surged across the globe this year. While the US has not been as convinced as European leaders for the need for a global summit, Mr Bush said he looked forward to convening a meeting in the “near future”. Speaking at Camp David, where he was hosting Nicolas Sarkozy, the French president, and Jose Manuel Barroso, president of the European Commission, Mr Bush stressed that while regulatory and institutional changes were necessary, it was “essential that we preserve the foundations of democratic capitalism”. “We must resist the dangerous temptation of economic isolationism and continue the policies of open markets that have lifted standards of living and helped millions of people escape poverty around the world.” The White House did not announce any details about when or where the summit would be held. One senior official said Mr Bush “wants participation and ideas from both developed and developing nations”. Mr Sarkozy and Mr Barroso have been pushing for a global summit to tackle the financial crisis, and the French president has also called for a complete overhaul of the international financial system.... Before arriving in the US, the European leaders won backing from Ban Ki-moon, the United Nations’ secretary general. Mr Ban suggested the UN headquarters in New York as a possible venue for the summit, but the White House was also considering other locations.Knowing what I know about the administration, my guess is that if the other locations being considered at the same level as the U.N. headquarters would be here, here, and here. Seriously, as I blogged last week, in the good ol' days the U.S. would have completely stiff-armed this kind of suggesion from the French. The fact that the administration is entertaining the idea means one of three things:
The thin results from the China trip were of little surprise to Western donors. Asked about the likelihood of Pakistan winning the direct cash infusion it was seeking, a senior Chinese diplomat was reported by Western officials to have said, “We have done our due diligence, and it isn’t happening.”So it looks like Pakistan will have to go to the IMF after all. Now you might think this is a sign that China is not as strong as people think. I see it as a disturbing sign that China really seems to want to play the role of the United States during the early 1930's. I don't think China's is incapable of pitching in -- I think they're unwilling to do so. A declining hegemon with the willingness but not the capability to act as the global leader, combined with a rising power with the capability but not the willingness to act as a global leader, is a very scary combination. I suspect that the situation is not quite as dire as the 1930's power transition, but it bothers me that I even have to go there. Developing....
When did U.S. hegemony end? A) Last year B) Last month C) Ten minutes ago D) Ten minutes from nowAnd this was before anyone knew about this. Discuss.
Daniel W. Drezner is professor of international politics at the Fletcher School of Law and Diplomacy at Tufts University.