The changing economic epicentre of the world

By Shahid R. Siddiqi

ON the demise of Soviet Union 18 years ago, US president George H.W. Bush announced the emergence of a New World Order. He said: ‘A hundred generations have searched for this elusive path to peace, while a thousand wars raged across the span of human endeavour’.
And he claimed that in this new world ‘the rule of law supplants the rule of the jungle, a world in which nations recognise the shared responsibility for freedom and justice, a world where the strong respect the rights of the weak.’ With America’s emergence as the only superpower, other countries had little choice but to align themselves with it.
But by pounding a hapless Iraq soon afterwards, supposedly to punish Saddam Hussain for his Kuwait invasion, he proved his pious pronouncements to be mere rhetoric and gave the world a preview of the rise of a ‘unipolar world’ to be ruthlessly controlled and steered by an imperialist America to serve its own ends.
Avoiding the agenda of aggression, President Clinton focused on rebuilding the shattered economy that had cost Bush his job. His success at creating a domineering American position, strong economy and substantial international goodwill, thanks to his policies of multilateralism, convinced everyone that the ‘New American Century’ was at hand.
But by 2008 the picture had drastically changed. America was gasping for breath. It was sinking deeper into the hole it found itself in. Having exercised undisputed political, economic and military power in the twentieth century, it was now in the throes of decline, its fall from power imminent.
In 2000, the American people blundered by electing George W. Bush. This not only adversely impacted their fortunes but also those of the people of the world. Pursuing an agenda of remodelling the world to suit their myopic designs, egged on by the war machine to use aggression as a tool, 9/11 providing the pretext, relying on unilateralism and displaying the arrogance of a ruffian, President Bush and his coterie of neocons ventured out on a mission that would ultimately prove self-destructive. Defying the will of the international community and throwing international law out of the window, G.W. Bush attacked Afghanistan and then Iraq, listing North Korea and Iran as the next battle grounds. Justifications for attack were drummed up and people and governments were manipulated, bullied and coerced to fall in line. Nato was turned into an aggressive military alliance, laying the ground for another Cold War.
All this was done for ‘good causes’, people of the world were told. It was necessary to ‘rid the world of terrorism’, to ‘liberate people from tyranny’, to ‘destroy the axis of evil’ and to ‘eliminate threats to western security’. The real agenda was, however, different. They were out to demolish unfriendly regimes under the garb of ‘ushering in democracy’, splinter and remap the Muslim world, crush Islamic groups opposed to US policies, grab energy resources, extend hegemony into former Warsaw Pact countries and Soviet Republics, promote the interests of American military industrial complex that thrives on war, terrorise the world into submission and financially gain from the resulting chaos. Like a drunken cowboy, America was wildly shooting off the hip, totally out of control.
These actions brought nothing but ruin to America. The whimsical 3-trillion dollar war in Iraq and the failed ‘war on terror’ in Afghanistan, both executed on credit, broke the back of its economy (military spending increased by 60 per cent, excluding war expenditure). These wars compromised America’s standing as world power, once again exposed the limitations of its military operations, earned universal scorn for its policies of unilateralism, subversion, regime change and human rights violations, caused a steep rise in anti-Americanism in the Muslim world and strengthened the jihadi resolve to defeat American imperialism. But this was not all.
Iran laughed off the American threats of invasion knowing its incapability to open the third front. European allies began dissociating from US adventurism and refused to follow Bush policies that ran counter to their economic and security interests. Germany, France, Spain and Italy scuttled Bush’s efforts to induct Ukraine and Georgia into US-led Nato, signalling policy differences. Its allies refused to participate in troop surge in Afghanistan and the EU brushed aside Bush’s call for sanctions against Russia for counterattacking Georgia. Russia, alarmed and threatened by intrusive US moves in Eastern Europe, the Caucuses and Central Asia –areas critical to its security, responded aggressively on the issue of Georgia and missile deployment in Poland and the Czech Republic.
The neocons proved to be out of touch with reality. They refused to see that there was a new world out there which could neither be reshaped nor controlled by the use of brute military might. They refused to resort to a combination of intellectual, political and military strengths. They ignored the fact that political and military power is the extension of economic and financial strength, forgetting that just about 15 years back the Soviet Union had collapsed for this very reason, it was politically and militarily a ‘first world’ power but a ‘third world’ economy. It simply could not sustain itself.
Domestically, the economic and fiscal picture turned bleak, severely restraining America’s ability to assert itself externally. National debt approached an unprecedented ten trillion dollars and next year’s federal budget is projected to run in a massive deficit of 1.2 to 2 trillion-dollars. Collapse of speculative financial markets caused American economic meltdown that also crushed many world economies. The dollar is under threat of being replaced as international currency for oil trade and as world’s reserve currency. Some even speculate a US default on its debt by 2009 that may force it to revalue the dollar, sending a wave of fear among its foreign investors, causing a liquidity crunch. In short, America faces the biggest financial challenge since the Great Depression.
The collapse of neocon doctrine caused Bush to retreat. He was forced to come to terms with those he called the ‘axis of evil’. He negotiated with North Korea. In a reversal of policy, he signed a troop withdrawal agreement with Iraqi government. After prolonged threats of attacking its nuclear sites, he is now struggling to come to a tacit understanding with Iran on managing a post-withdrawal Iraq. And, as reports indicate, he has given a nod to the opening of a dialogue with his most rabid adversary, the Taliban. Failure written large on its face, America has lost its moral authority and influence as a superpower, with the diminishing limits of American power plainly visible.
A nervous nation scrambled to change guard, but the havoc wrought by Bush administration had prematurely triggered the beginning of the end of America’s era as the sole and mighty superpower. The grossly unjust and archaic economic, political and military ‘unipolar’ world order, or the ‘New World Order’ as George H.W. Bush had called it, collapsed just 18 years after it was born and about which Vladimir Putin said: ‘It refers to one type of situation, one centre of authority, one centre of force, one centre of decision making. It is a world in which there is one Master, one Sovereign. This is pernicious…. unacceptable …. impossible.’
President-elect Obama brings an end to a long national nightmare called the Bush administration, but faces an uphill task. He inherits a mess of insurmountable proportions, including two wars that are going nowhere, a military budget almost equal to the world’s combined military budget and increasing, severely curtailed financial resources, social programs in tatters and the economy in deep recession.
He is going to preside over a country that goes hat in hand to its creditors asking for money to fuel its hubris. Externally, he faces an international community irate with the misuse of American power and happy to see it lose its monopoly. There are no easy solutions in sight to the crises that the US imperialism has created.
Obama’s commitment of ‘change’ would be a tall order. By the time he gets even close to shutting the Pandora’s box that Bush had opened, curb the establishment’s urge for futile self-destructive wars and substantially reduce military spending, put the economy back on track and rehabilitate America’s international image, political realities around the globe would have substantially changed. Far reaching geopolitical developments would have given rise to a new power-paradigm.
World’s economic epicentre has shifted to Asia. Emerging economies are now poised to play a greater role in world affairs. An economically strong China is positioning itself as one of the future superpowers. Resurgent Russia is beginning to reassert itself. Western Europe, secure from Soviet threat, recovered from its back-breaking wars and wary of American arrogance, is breaking free of American protectionism. A ‘New Multi-polar World Order’ is now emerging that will likely create a greater balance of power with a hope for stability. Some even prefer to call it the Real World Order, in which the US will not able to control the international agenda.
Despite its troubles, America cannot be written off, not completely, not yet. Although its power has prematurely reached its limits and will likely decline in the future, America remains for now the strongest military power and the biggest economy, though not strong enough to wage wars. The US National Intelligence Council in its recent report titled ‘Global Trends – 2025’ admits that the US will remain ‘the most powerful yet less dominant country’ in the coming years. The new administration will therefore have to reconcile with an America being one of the great powers, as opposed to being the only power centre that it was, and transit from the mindset of arrogance to that of humility, which Obama promises.

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