(Washington, DC: The German Marshall Fund of the United States, 2010)
By Ashley Tellis
Simply stated, the success of the current wave of globalization, like the one that preceded it in the 19th century, is owed fundamentally to the existence of a hegemonic power. Since the end of the Second World War, American preponderance has underwritten many of the key components—from the dollar as a global reserve currency to the rules of the international order to the defense of the commons—which have made a successful open trading system possible.
Should the American economy weaken inexorably over time, there is every likelihood that the current successful phase of globalization, although often assumed to be a permanent reality, could atrophy and eventually collapse. Mercifully, such dangers are neither immediate nor inevitable because the U.S. economy, whatever its current troubles, is not enervated by any terminal illness.
In fact, by the canons of contemporary growth accounting, the United States is better positioned relative to most other countries to sustain over the long term the high levels of capital accumulation, labor-force growth, and technological innovation necessary to maintain economic strength because of its size and natural resources, its demographic profile and access to immigration, its wealth and material well-being, its open economic and political systems, and its social and institutional adaptability.
America’s chief weaknesses in this context are twofold: its problematic model of capital formation, which is as much a product of domestic choices as it is a consequence of larger international economic imbalances, and its dysfunctional national decision-making institutions, which although appearing to satisfy its founding fathers’ objective of preventing tyranny have engendered a paralyzing inability to think strategically and act coherently.
While the latter problem is something that must be overcome unilaterally, the former can be most effectively solved collaboratively, at least, if there is to be any orderly solution to the vexed problem of “global rebalancing.” Both the transatlantic and Asian partners of the United States, not to mention China, have great stakes in a successful transition, but this will require all parties to either share the pain collectively or else risk a convulsive dénouement that imperils both globalization and the emerging Asian century.
Even as the United States and its partners hopefully work toward cooperative exits from the increasingly unsustainable current global codependency—where the United States propels world economic growth through continued consumption utilizing resources loaned by others—Washington also needs to pay attention to renewing its military power. Such a requirement may appear odd at first sight, given that the U.S. military remains superior to all others by many metrics of comparison. Yet, on closer examination, American military strength is hobbled by serious challenges including budgetary constraints, unacceptable weapons cost growth, rising personnel costs, strained procurement and research and development budgets, difficult force structure dilemmas, and wily asymmetric threats, all of which—if left unaddressed—could undermine the current security environment that sustains globalization.
The best studies of the regional military balances in the Asia-Pacific, in fact, suggest an erosion of U.S. military superiority and, in particular, a diminishing capacity to protect the Asian allies in the face of rising Chinese power. The importance of arresting these adverse trends cannot be understated. They directly engage the question of whether the Asian miracle can be sustained over the secular period (with all the resulting benefits for American and transatlantic prosperity) and without any compromises in the security and autonomy of America’s regional allies and important neutrals (with all the concomitant gains for American and transatlantic interests).
Addressing these challenges requires the United States and its democratic partners in the East and the West to think about defense research and development, weapons procurement, and technology flows in new and more creative ways. It also requires greater agreement on issues relating to the legitimacy of the use of force. Above all else, however, it requires a greater European appreciation of how U.S. military superiority contributes to protecting a secure and stable Asian geopolitical order that ultimately redounds to the common advantage of both sides of the Atlantic and why that dominance, accordingly, must be preserved indefinitely.
The emerging Asian century undoubtedly represents a great opportunity for sustaining global prosperity. Yet because this era will be fundamentally different from the first iteration of the Asian miracle, in that allies and competitors are now inextricably entwined in a dense web of transactions which increase absolute gains but unevenly, the United States and its partners face many more challenges in maintaining a stable geopolitical order.
In such circumstances, the most effective strategy for Washington, as the leader of the transatlantic community, is not to retrench from its commitment to expanding the open economic system, but to maintain in good repair its own national power and its constituent military prowess in order to mitigate any tensions that may arise either regionally or globally between economic gains and international security.
Ashley Tellis is a Senior Associate at the Carnegie Endowment for International Peace.