Will the Liberal Order Survive?
The History of an Idea
During the nineteenth century,
the United States played a minor role in the global balance of power.
The country did not maintain a large standing army, and as late as the
1870s, the U.S. Navy was smaller than the navy of Chile. Americans had
no problems using force to acquire land or resources (as Mexico and the
Native American nations could attest), but for the most part, both the
U.S. government and the American public opposed significant involvement
in international affairs outside the Western Hemisphere.
A
flirtation with imperialism at the end of the century drew U.S.
attention outward, as did the growing U.S. role in the world economy,
paving the way for President Woodrow Wilson to
take the United States into World War I. But the costs of the war and
the failure of Wilson’s ambitious attempt to reform international
politics afterward turned U.S. attention inward once again during the
1920s and 1930s, leading to the strange situation of an increasingly
great power holding itself aloof from an increasingly turbulent world.
Like
their counterparts elsewhere, U.S. policymakers sought to advance their
country’s national interests, usually in straightforward, narrowly
defined ways. They saw international politics and economics as an
intense competition among states constantly jockeying for position and
advantage. When the Great Depression hit, therefore, U.S. officials,
like others, raced to protect their domestic economy as quickly and
fully as possible, adopting beggar-thy-neighbor tariffs and deepening
the crisis in the process. And a few years later, when aggressive
dictatorships emerged and threatened peace, they and their counterparts
in Europe and elsewhere did something similar in the security sphere,
trying to ignore the growing dangers, pass the buck, or defer conflict
through appeasement.
By
this point, the United States had become the world’s strongest power,
but it saw no value in devoting resources or attention to providing
global public goods such as an open economy or international security.
There was no U.S.-led liberal order in the 1930s, and the result was a
“low dishonest decade,” in the words of W. H. Auden, of depression,
tyranny, war, and genocide.
With
their countries drawn into the conflagration despite their efforts to
avoid it, Western officials spent the first half of the 1940s trying to
defeat the Axis powers while working to construct a different and better
world for afterward. Rather than continue to see economic and security
issues as solely national concerns, they now sought to cooperate with
one another, devising a rules-based system that in theory would allow
like-minded nations to enjoy peace and prosperity in common.
The
liberal international order that emerged after 1945 was a loose array of
multilateral institutions in which the United States provided global
public goods such as freer trade and freedom of the seas and weaker
states were given institutional access to the exercise of U.S. power.
The Bretton Woods institutions were set up while the war was still in
progress. When other countries proved too poor or weak to fend for
themselves afterward, the Truman administration decided to break with
U.S. tradition and make open-ended alliances, provide substantial aid to
other countries, and deploy U.S. military forces abroad. Washington
gave the United Kingdom a major loan in 1946, took responsibility for
supporting pro-Western governments in Greece and Turkey in 1947,
invested heavily in European recovery with the Marshall Plan in 1948,
created NATO in 1949, led a military coalition to protect South Korea
from invasion in 1950, and signed a new security treaty with Japan in
1960.
These
and other actions both bolstered the order and contained Soviet power.
As the American diplomat George Kennan and others noted, there were five
crucial areas of industrial productivity and strength in the postwar
world: the United States, the Soviet Union, the United Kingdom,
continental Europe, and Northeast Asia. To protect itself and prevent a
third world war, Washington chose to isolate the Soviet Union and bind
itself tightly to the other three, and U.S. troops remain in Europe,
Asia, and elsewhere to this day. And within this framework, global
economic, social, and ecological interdependence grew. By 1970, economic
globalization had recovered to the level it had reached before being
disrupted by World War I in 1914.
The
mythology that has grown up around the order can be exaggerated.
Washington may have displayed a general preference for democracy and
openness, but it frequently supported dictators or made cynical
self-interested moves along the way. In its first decades, the postwar
system was largely limited to a group of like-minded states centered on
the Atlantic littoral; it did not include many large countries such as
China, India, and the Soviet bloc states, and it did not always have
benign effects on nonmembers. In global military terms, the United
States was not hegemonic, because the Soviet Union balanced U.S. power.
And even when its power was greatest, Washington could not prevent the
“loss” of China, the partition of Germany and Berlin, a draw in Korea,
Soviet suppression of insurrections within its own bloc, the creation
and survival of a communist regime in Cuba, and failure in Vietnam.
Americans
have had bitter debates and partisan differences over military
interventions and other foreign policy issues over the years, and they
have often grumbled about paying for the defense of other rich
countries. Still, the demonstrable success of the order in helping
secure and stabilize the world over the past seven decades has led to a
strong consensus that defending, deepening, and extending this system
has been and continues to be the central task of U.S. foreign policy.
Until
now, that is—for recently, the desirability and sustainability of the
order have been called into question as never before. Some
critics, such as U.S. President-elect Donald Trump, have argued that the
costs of maintaining the order outweigh its benefits and that
Washington would be better off handling its interactions with other
countries on a case-by-case transactional basis, making sure it “wins”
rather than “loses” on each deal or commitment. Others claim that the
foundations of the order are eroding because of a long-term global power
transition involving the dramatic rise of Asian economies such as China
and India. And still others see it as threatened by a broader diffusion
of power from governments to nonstate actors thanks to ongoing changes
in politics, society, and technology. The order, in short, is facing its
greatest challenges in generations. Can it survive, and will it?
POWER CHALLENGED AND DIFFUSED
Public
goods are benefits that apply to everyone and are denied to no one. At
the national level, governments provide many of these to their citizens:
safety for people and property, economic infrastructure, a clean
environment. In the absence of international government, global public
goods—a clean climate or financial stability or freedom of the seas—have
sometimes been provided by coalitions led by the largest power, which
benefits the most from these goods and can afford to pay for them. When
the strongest powers fail to appreciate this dynamic, global public
goods are underproduced and everybody suffers.
The mythology that has grown up around the order can be exaggerated.
Some
observers see the main threat to the current liberal order coming from
the rapid rise of a China that does not always appear to appreciate that
great power carries with it great responsibilities. They worry that
China is about to pass the United States in power and that when it does,
it will not uphold the current order because it views it as an external
imposition reflecting others’ interests more than its own. This concern
is misguided, however, for two reasons: because China is unlikely to
surpass the United States in power anytime soon and because it
understands and appreciates the order more than is commonly realized.
Contrary
to the current conventional wisdom, China is not about to replace the
United States as the world’s dominant country. Power involves the
ability to get what you want from others, and it can involve payment,
coercion, or attraction. China’s economy has grown dramatically in
recent decades, but it is still only 61 percent of the size of the U.S.
economy, and its rate of growth is slowing. And even if China does
surpass the United States in total economic size some decades from now,
economic might is just part of the geopolitical equation. According to
the International Institute for Strategic Studies, the United States
spends four times as much on its military as does China, and although
Chinese capabilities have been increasing in recent years, serious
observers think that China will not be able to exclude the United States
from the western Pacific, much less exercise global military hegemony.
And as for soft power, the ability to attract others, a recent index
published by Portland, a London consultancy, ranks the United States
first and China 28th. And as China tries to catch up, the United States
will not be standing still. It has favorable demographics, increasingly
cheap energy, and the world’s leading universities and technology
companies.
Moreover,
China benefits from and appreciates the existing international order
more than it sometimes acknowledges. It is one of only five countries
with a veto in the UN Security Council and has gained from liberal
economic institutions, such as the World Trade Organization (where it
accepts dispute-settlement judgments that go against it) and the
International Monetary Fund (where its voting rights have increased and
it fills an important deputy director position). China is now the
second-largest funder of UN peacekeeping forces and has participated in
UN programs related to Ebola and climate change. In 2015, Beijing joined
with Washington in developing new norms for dealing with climate change
and conflicts in cyberspace. On balance, China has tried not to
overthrow the current order but rather to increase its influence within
it.
The order is facing its greatest challenges in generations.
The
order will inevitably look somewhat different as the twenty-first
century progresses. China, India, and other economies will continue to
grow, and the U.S. share of the world economy will drop. But no other
country, including China, is poised to displace the United States from
its dominant position. Even so, the order may still be threatened by a
general diffusion of power away from governments toward nonstate actors.
The information revolution is putting a number of transnational issues,
such as financial stability, climate change, terrorism, pandemics, and
cybersecurity, on the global agenda at the same time as it is weakening
the ability of all governments to respond.
Complexity
is growing, and world politics will soon not be the sole province of
governments. Individuals and private organizations—from corporations and
nongovernmental organizations to terrorists and social movements—are
being empowered, and informal networks will undercut the monopoly on
power of traditional bureaucracies. Governments will continue to possess
power and resources, but the stage on which they play will become ever
more crowded, and they will have less ability to direct the action.
Even
if the United States remains the largest power, accordingly, it will not
be able to achieve many of its international goals acting alone. For
example, international financial stability is vital to the prosperity of
Americans, but the United States needs the cooperation of others to
ensure it. Global climate change and rising sea levels will affect the
quality of life, but Americans cannot manage these problems by
themselves. And in a world where borders are becoming more porous,
letting in everything from drugs to infectious diseases to terrorism,
nations must use soft power to develop networks and build institutions
to address shared threats and challenges.
China is unlikely to surpass the United States in power anytime soon.
Washington
can provide some important global public goods largely by itself. The
U.S. Navy is crucial when it comes to policing the law of the seas and
defending freedom of navigation, and the U.S. Federal Reserve undergirds
international financial stability by serving as a lender of last
resort. On the new transnational issues, however, success will require
the cooperation of others—and thus empowering others can help the United
States accomplish its own goals. In this sense, power becomes a
positive-sum game: one needs to think of not just the United States’
power over others but also the power to solve problems that the United
States can acquire by working with others. In such a world, the ability
to connect with others becomes a major source of power, and here, too,
the United States leads the pack. The United States comes first in the
Lowy Institute’s ranking of nations by number of embassies, consulates,
and missions. It has some 60 treaty allies, and The Economist estimates that nearly 100 of the 150 largest countries lean toward it, while only 21 lean against it.
Increasingly,
however, the openness that enables the United States to build networks,
maintain institutions, and sustain alliances is itself under siege.
This is why the most important challenge to the provision of world order
in the twenty-first century comes not from without but from within.
POPULISM VS. GLOBALIZATION
Even
if the United States continues to possess more military, economic, and
soft-power resources than any other country, it may choose not to use
those resources to provide public goods for the international system at
large. It did so during the interwar years, after all, and in the wake
of the conflicts in Afghanistan and Iraq, a 2013 poll found that 52
percent of Americans believed that “the U.S. should mind its own
business internationally and let other countries get along the best they
can on their own.”
The
2016 presidential election was marked by populist reactions to
globalization and trade agreements in both major parties, and the
liberal international order is a project of just the sort of
cosmopolitan elites whom populists see as the enemy. The roots of
populist reactions are both economic and cultural. Areas that have lost
jobs to foreign competition appear to have tended to support Trump, but
so did older white males who have lost status with the rise in power of
other demographic groups. The U.S. Census Bureau projects that in less
than three decades, whites will no longer be a racial majority in the
United States, precipitating the anxiety and fear that contributed to
Trump’s appeal, and such trends suggest that populist passions will
outlast Trump’s campaign.
It has
become almost conventional wisdom to argue that the populist surge in
the United States, Europe, and elsewhere marks the beginning of the end
of the contemporary era of globalization and that turbulence may follow
in its wake, as happened after the end of an earlier period of
globalization a century ago. But circumstances are so different today
that the analogy doesn’t hold up. There are so many buffers against
turbulence now, at both the domestic and the international level, that a
descent into economic and geopolitical chaos, as in the 1930s, is not
in the cards. Discontent and frustration are likely to continue, and the
election of Trump and the British vote to leave the EU demonstrate that
populist reactions are common to many Western democracies. Policy
elites who want to support globalization and an open economy will
clearly need to pay more attention to economic inequality, help those
disrupted by change, and stimulate broad-based economic growth.
It
would be a mistake to read too much about long-term trends in U.S.
public opinion from the heated rhetoric of the recent election. The
prospects for elaborate trade agreements such as the Trans-Pacific
Partnership and the Transatlantic Trade and Investment Partnership have
suffered, but there is not likely to be a reversion to protectionism on
the scale of the 1930s. A June 2016 poll by the Chicago Council on
Global Affairs, for example, found that 65 percent of Americans thought
that globalization was mostly good for the United States, despite
concerns about a loss of jobs. And campaign rhetoric notwithstanding, in
a 2015 Pew survey, 51 percent of respondents said that immigrants
strengthened the country.
World politics will soon not be the sole province of governments.
Nor
will the United States lose the ability to afford to sustain the order.
Washington currently spends less than four percent of its GDP on defense
and foreign affairs. That is less than half the share that it spent at
the height of the Cold War. Alliances are not significant economic
burdens, and in some cases, such as that of Japan, it is cheaper to
station troops overseas than at home. The problem is not guns versus
butter but guns versus butter versus taxes. Because of a desire to avoid
raising taxes or further increasing the national debt, the U.S.
national security budget is currently locked in a zero-sum tradeoff with
domestic expenditures on education, infrastructure, and research and
development. Politics, not absolute economic constraints, will determine
how much is spent on what.
The
disappointing track record of recent U.S. military interventions has
also undermined domestic support for an engaged global role. In an age
of transnational terrorism and refugee crises, keeping aloof from all
intervention in the domestic affairs of other countries is neither
possible nor desirable. But regions such as the Middle East are likely
to experience turmoil for decades, and Washington will need to be more
careful about the tasks it takes on. Invasion and occupation breed
resentment and opposition, which in turn raise the costs of intervention
while lowering the odds of success, further undermining public support
for an engaged foreign policy.
Political
fragmentation and demagoguery, finally, pose yet another challenge to
the United States’ ability to provide responsible international
leadership, and the 2016 election revealed just how fragmented the
American electorate is. The U.S. Senate, for example, has failed to
ratify the UN Convention on the Law of the Sea, despite the fact that
the country is relying on it to help protect freedom of navigation in
the South China Sea against Chinese provocations. Congress failed for
five years to fulfill an important U.S. commitment to support the
reallocation of International Monetary Fund quotas from Europe to China,
even though it would have cost almost nothing to do so. Congress has
passed laws violating the international legal principle of sovereign
immunity, a principle that protects not just foreign governments but
also American diplomatic and military personnel abroad. And domestic
resistance to putting a price on carbon emissions makes it hard for the
United States to lead the fight against climate change.