International travel and trade are breaking down barriers. The international elite is still only a small portion of any national population, but it is extremely important and growing in size.
Knowledge industries appear to be the wave of the future, and they are less prone to centralization. Indeed, the model of the new form of economic development is Silicon Valley, where individual entrepreneurs proliferate firms like mushrooms, each attempting to provide an innovation the other has not yet mastered. Recent news articles about the rise of a new technological center in India, Bangalore, suggest the future. The center of the Indian atomic energy industry, Bangalore has engineers who provide at $500 a month services that cost $15,000 a month in Silicon Valley. American firms are pouring investment into Bangalore, and it is now easier to call New York from an office in Bangalore than it is to telephone a colleague across town. The global net there has become tighter than the local net.
In such a world the ability of the state to control economic activity at the national level seems to be steadily declining. When Francois Mitterrand won the presidency of France the first time, he ran on a platform of reducing unemployment. He soon found that the state of France lacked the tools to carry out such a program because of its membership in the Common Market. Two years into his term he was forced to choose between his promises to the French people and French membership in the Common Market. He fired several members of his cabinet and chose the Common Market.
Even a dominant economic power like the United States finds that its fate is increasingly in the hands of others. Western Europe, Japan, and Canada now account for 60 percent of U.S. exports. During the period 1987-91 roughly 50 percent of U.S. real growth reflected the expansion of exports. Export growth equaled virtually all of real GDP growth in 1990 and cut the 1991 decline in growth by one third.
The Clinton program cannot succeed unless Europe, Japan, and Canada continue to import U.S. products at high rates. For that reason the much lower growth rates the OECD projects for Western Europe, Japan, and Canada in the coming 2 years are therefore very bad news for the Clinton administration. It is unlikely that the new president can carry out his campaign promises in the economic field unless he has cooperation from Western Europe and Japan.
What will be the role of Asia in this new world? The question is critical because so many of the world’s most dynamic economies can be found there. At this point we can only advance possibilities. We probably will move much more decisively from the Eurocentric world we have known for the last 100 years. European civilization is not spent. Indeed, what we call world civilization is in large measure the globalization of European civilization. But Europe now has competitors, and these are likely to become stronger rather than weaker. Most of these new competitors are in Asia.
But for Asia to play a larger geopolitical role it must take a number of key steps. It must develop a security order that includes the United States but is not so dependent on it. Asia must build on elements within the region. The United States has been very resistant to any talk of changes in the security status quo in Asia. But this seems a very shortsighted view. It is important that Asian states begin talking to one another more openly, in more detail about the security issues that trouble them. Although the future of Asia in the coming decades looks bright, security disputes could derail economic and social progress in the region. An eruption of conflict in Korea or skirmishes over the Spratly Islands or an arms race triggered by misunderstandings—any or all are possibilities. Indeed, between 1980 and 1988 Japan increased its defense spending by 46 percent, India and South Korea by 63 percent, and Taiwan by 42 percent in 1988 prices and exchange rates. Asia needs a forum in which structured dialogue can take place among the major players—the United States, Russia, China, including Taiwan, ASEAN, ANZUS and Korea. Whether it would deserve the label CSCA is immaterial. The forum is needed so that Asia can begin to develop common understandings on how the current status quo, which is too dependent on the U.S. presence, can begin to evolve in a way that does not threaten the security of anyone. In this regard, Asian states must thicken the patterns of regional cooperation and involve all governments in the region, including the Communist countries. It must heed American notes of caution, but it must not allow its policy to be dictated from Washington.
The region will not be stable or able to play the role that is naturally its own if there is not growing respect for democracy and human rights. Progress has been made, but if Asia is to have the vitality that is so necessary for the next stage of economic development, it must convince individuals that their rights will be protected within Asian states.
Finally, as the task for the coming 20 years, the Pacific region has three priorities: It must find ways to harness constructively Japanese dynamism, fulfill Chinese potential, and limit American retrenchment. If these tasks can be handled successfully, the people of this part of the world can look forward to many years of peace and prosperity along with global leadership.
In every region of the world the United States will be present but decreasingly dominant. America’s “unipolar moment,” which some saw at the end of the Gulf War, will prove to be extremely brief. Power will continue to become more evenly distributed as America’s military dominance recedes and as others’ economic performance improves. Such trends need not disturb us too much as long as America remains an important world power, and prudent retrenchment does not become foolish retreat. The test of leadership in Washington will be to manage one without calling forth the other.
REEXAMINING NATIONAL STRATEGY
William G. Hyland
America is redefining itself. A new generation is taking over the White House, and the national focus has shifted from foreign policy to domestic issues. At the same time, the end of cold war has also liberated foreign policy. New issues and new priorities are inevitable, but a new consensus on foreign affairs has yet to take shape.
The United States has no broad international strategy. Rather it pursues a collection of policies; some are left over from the cold war, and some are relatively new.
The foreign policy agenda is far less dangerous and in most respects easier to deal with than the agenda that confronted Mr. Clinton’s predecessors. Nowhere are American vital interests under attack, or even seriously threatened. The United States in 1993 is able to deter any conceivable attack, and to deal with any conceivable threat to its national security. Its international position is probably better now than at any time since 1920. Of course, attaining this unique position has been quite costly, and has contributed to America’s burgeoning economic and social problems. This, of course, is one reason why Governor Clinton was elected: not to solve the world’s ills, but to apply his laser-like concentration on America’s ills.
One of the virtues of the end of the cold war is that the new president, unlike his predecessors, is free to reexamine the long-term interests of the United States in more propitious circumstances than at any time since Pearl Harbor. The new administration, if it chooses, can even reexamine a series of major security issues that heretofore have been sacrosanct.
America’s role in the so-called new world order is still not clearly defined. Many observers believe the new world order is primarily an American responsibility. In the summer of 1991, President Bush said that “Our responsibility remains not only to protect our citizens and our interests but also to help create a new world in which our fundamental ideals not only survive but flourish.” This comes fairly close to remaking the world in our own image.