Monday, January 30, 2012

Twenty Years After the Cold War: A Strategic Survey

By Nader Elhefnawy
Originally Published in PARAMETERS, Spring 2011, pp. 6-17
© 2011 Nader Elhefnawy

(A summary version of the article can be found here.)

Two decades have passed since the end of the Cold War. Indeed, anyone under thirty has virtually no personal memory of the conflict, and the generation born after the Soviet Union's collapse is reaching adulthood. In that time talk of the "post-Cold War" has become less common, especially with the onset of the War on Terror, but nothing has quite taken its place.

One might point to the tendency of recent debate to focus on specific, immediate issues (Iraq, Afghanistan, NATO) rather than more comprehensive approaches to world affairs as an element, but the preceding decade saw a profusion of "big picture" theories. The theories encompassed everything from a Hegelian "end to history" to clashes of civilizations; from a reaffirmation of realpolitik to a new dawn for collective security; from neoliberal globalization to neo-mercantilist geo-economics (with American imperium or American decline part of the stakes); from Malthusian catastrophe to postindustrial (or even posthuman) liberation from nature's constraints. These images inevitably oversimplified the reality they described, and wider discussion tended to simplify them further still-but the resulting collection of ideas still has some explanatory power. Nonetheless, a collection of partial explanations seems like a letdown to many compared with the more focused strategizing of the Cold War era.

However, the comparisons between a bewildering present and a clearer past are themselves overly simplistic. The Cold War, too, interacted with other trends, developments, movements and forces inside an even larger picture, like decolonization in Africa and Asia (without which superpower competition in the Third World is scarcely comprehensible). At the same time those presenting globalization, the "clash of civilizations" or ecological constraints as the key to understanding the twenty-first century speak of forces that are age-old, and which assumed their present shape no later than the 1970s, well before the Cold War's end.

Simply put, a Grand Unifying Theory of International Relations has always been (and perhaps always will be) chimerical. Nonetheless, a broad view of the international situation as it actually developed over the last two decades is indispensable to the crafting of coherent, focused policy. The compromise I suggest here is a focus on key trends in place of that elusive unified image, with six such trends (in international conflict, global economics and the extent of international cooperation) from the last twenty years particularly worthy of note.

1. Great Power Conflict Has Receded.1
After the Soviet bloc's implosion the consensus among security analysts was that no conflict comparable to the Cold War would emerge for a long time to come. Specifically, the reduction of significant political differences among the largest and most powerful states (especially the end of the ideological conflict and the division of Europe), and the sharp shift in the military balance of power (which suggested the U.S. would not face a Large Peer Competitor for decades), reduced the prospect of great power war to a much smaller role in both international affairs and defense planning than at any time since 1945.

In addition, the 1990s saw substantially improved relations between Russia and China, and later China and India also, bringing the risk of armed conflict between the three continental "giants" of Asia to a historic low.2 The political status of Taiwan, and other Chinese territorial and maritime claims in the East and South China Seas, remain objects of contention, and Chinese relations with Taiwan and Japan deteriorated somewhat in the late 1990s and early 2000s. However, even the low point in Sino-Taiwanese relations of 1996 was a far cry from the violence of the 1950s, and China's relations with Japan and Taiwan have improved markedly since then.3 Indeed, China became far less prone to use force in disputes with all its neighbors since the 1980s, its relations with them (and the U.S.) characterized far more by economic interconnection than military competition. As a result, Cold War-style crises and proxy wars have been virtually absent, with the situations of Taiwan in 1996 and post-Soviet Georgia at most partial exceptions.

The prospect of the European Union (EU) or Japan arming on a significant scale or fighting with other large powers (for instance, Japan confronting Russia) is even more remote. The white papers of the major European powers in particular recognize no direct state threats to their security, from each other, or from powers outside the EU. If anything, the 2008 economic crisis and its aftermath only reinforced Europe's trend toward lower investments in defense since the Cold War's end, slowing the EU's already long-delayed development of a common military capability.4

2. Large-Scale Warfare Has Been Pushed to the Margins of the States System, With Intra-State War Supplanting Interstate War.
After the Cold War, warfare and the threat of warfare became largely confined to what Thomas P.M. Barnett termed the "Non-Integrating Gap," the least-developed and least-"globalized" regions inhabited by "roughly one-third of humanity," encompassing "the Caribbean rim, the Andes portion of South America, virtually all of Africa, the Balkans, the Caucasus, Central Asia, the Middle East, and most of southeast Asia."5 War is now a more frequent occurrence there, but this is due mainly to the increased incidence of intra-state warfare pitting states against non-state actors in internal conflicts, while interstate wars become less common.6 The territory of the former Soviet Union has seen just two interstate wars (the 1993-1994 Nagorno-Karabakh War, and the 2008 Russo-Georgian War), while Latin America had one (the 1995 Cenepa War). Despite periodic incidents, large-scale interstate violence has been absent from the Korean and Arab-Israeli conflicts, and Southeast Asia, with the 1999 Kargil War the principal exception along the Indo-Pakistani frontier.

It is noteworthy that these conflicts tended to involve a great power against a markedly weaker state not enjoying significant material support from another great power (as in U.S. actions against Iraq, Yugoslavia and Afghanistan, or Russia's against Georgia). At the same time, none of the wars between smaller states became Cold War-style proxy wars between bigger powers to a meaningful extent. It is also worth noting that the initiators of interstate conflicts have so often attempted to "disguise" their action as an aspect of an intra-state conflict (as in Kargil and the Congo), while wars ending with regime change and occupation tended to be followed by a lengthier, bloodier phase of intra-state warfare (as in post-invasion Iraq and Afghanistan).

Unsurprisingly, the interstate wars of the post-1990 period tended to be brief and limited in intensity (a comparison between the Third and Fourth Indo-Pakistani Wars makes the point), and no conflict comparable to the Korean, Vietnam or Iran-Iraq wars took place anywhere, while total annual battle-deaths worldwide have fallen sharply since the Cold War era.7 The attention given to weapons of mass destruction, counterinsurgency, non-state terrorism and urban and computer warfare, rather than conventional war-fighting, also reflects the unevenness of these conflicts. Indeed, the changing character of military missions has revived doubts about the appropriateness of the traditional orientation of the major armed forces toward conventional war-fighting in their organization and procurement, with the U.S. no exception to this pattern.

3. Neoliberal Globalization Has Proved Robust, But Problematic.
In 1992, Lester Thurow declared globalization dead in his influential book Head to Head, and predicted a turn to neo-mercantilist trading blocs afterward.8 Many pundits repeated the claim after the 1997-1998 financial meltdown, and yet again after the September 11, 2001 terrorist attacks. Yet, the process continued inexorably through these years. Global exports grew a staggering 6.7 percent a year from 1992 to 2008, these quantitative changes reflecting important qualitative ones, like the unprecedented development of international supply chains and global financial flows.9 The World Trade Organization (WTO) that institutionalized the process now counts 153 nations as members, including virtually all the major economies (with Russia now applying for membership). The speculation that the end had finally arrived following the 2008 crisis proved just as premature as on the previous occasions. Of course, states never stopped pursuing economically nationalistic policies, but their behavior has been pragmatic rather than ideological, and more constrained, while direct, overt challenges to globalization have been marginal, especially inside the major industrialized economies.

Still, the world's economic performance during the present (1970s-) round of globalization has been problematic. Critics commonly point to the increased financial instability epitomized by the 1997-1998 and 2008 crises, and rising inequality between and within countries.10 While this is often rationalized as the unavoidable price of economic growth, that growth has actually proven mediocre. According to WTO data per capita Gross World Product (GWP) grew 3 percent a year in the 1950-1973 period, but less than half that fast from 1973 to 2006.11 One study even suggests that growth after 1980 barely kept pace with population increase.12

This pattern has been evident in both rich and poor countries, and government finances reflect the problem. While the debt-to GDP ratio of the major industrial countries fell from the 1940s through the 1970s, it has more than doubled since 1974, a problem exacerbated by the 2008 crisis.13 The estimated U.S. Federal deficits for the years 2009-2011 come to over $4 trillion, bringing the American national debt to $14 trillion (roughly 100 percent of GDP, a ratio not seen since the World War II era), and sharply elevated deficits are expected for years to come.14 Japan's debt is now approaching 200 percent of that country's GDP.15 The same events also precipitated the sovereign debt crisis directly afflicting several EU members, and the integrity of the Union as a whole. Such a situation is insupportable, but the prospects for remediation remain unclear. Meanwhile fears of similar (or even sharper) crises in the near future, even before the world's economies have recovered, loom large, with theorizing about the "next one" abundant in the press.

Additionally the greater speed, density and complexity of international communications and transport that facilitate legal flows of goods, services and people also facilitate criminal and terrorist activity, illegal migration, and their associated problems-in many cases, worsened by the uncertainties and stresses imposed by the global economy. There are also grounds for the argument that globalization's apparent discrediting of secular, material alternatives to neoliberalism has contributed to ethnic and sectarian conflict and violent religious fundamentalism by fostering a preoccupation with identity and channeling expressions of political dissatisfaction into cultural and religious directions.16 Globalization may not entirely account for al-Qaida's emergence, but al-Qaida's emergence would be inconceivable without globalization.

4. Global Output, World Manufacturing, and the Balance of Trade Have Shifted Sharply Toward East Asia (and China), While Europe Has Consolidated.
In the early 1990s economic analysts predicted that the twenty-first century would see a three-way competition between the U.S., Japan and a German-led Europe.17 Nonetheless, slow growth in the industrialized world (and especially Japan and Germany) markedly reduced their share of GWP. Meanwhile China, once ignored in such discussions, proved to be the outstanding exception to the general pattern of slow economic growth, sustaining double-digit rates through these years. Accordingly, as of 2008 it accounted for seven percent of GWP, and a massive 17 percent of world manufacturing, making it a close second to the U.S. in this area, and likely to be first quite soon.18 As the situation stands now, China is the world's largest exporter, as well as the possessor of the largest trade surplus, largest positive current account balance and largest reserve of foreign exchange, and enjoys all the financial influence this carries. More broadly, the balance of global manufacturing and trade has shifted toward East Asia, with the development of China and other industrial powers in the region more than offsetting Japan's (relative) decline.19

East Asia's economies have integrated in the course of their expansion, but this process pales next to European integration. The evolution of the 12-nation European Economic Community (EEC) into today's 27-nation EU has helped the institution preserve its share of GWP (presently 14 percent larger than the U.S.'s) and global manufacturing (over fifty percent larger than that of the U.S. or China).20 Its common currency challenges the American dollar in ways the German mark and French franc never could have.

At the same time, the U.S.'s position has changed in ways understated by shares of GWP, like its falling share of world manufacturing.21 This reflects not only the rapid growth of developing nations (like China), but the receding of manufacturing as a part of the U.S. economy, leaving the country a net importer of manufactures (and eliminating its most obvious way of financing other imports, like oil).22 This has enlarged the merchandise trade deficits chronic since the 1970s to 5-6 percent of U.S. GDP in 2004-2008, which are only partially offset by a surplus in service exports and returns on foreign investment, so that the U.S. has the world's largest current account imbalance (over $700 billion in 2008).23 The resulting trade imbalances have profoundly destabilized the U.S. and global economies through their fostering of speculative bubbles, while helping to leave American borrowers reliant on foreign investors.24

However, just as the 2008 crisis has raised doubts about the course pursued by fiscally troubled governments around the world, it may mark a shift in this pattern as well. Not only is China's growth likely to slow as it matures in the coming years, but its socially, ecologically and politically costly export-oriented strategy may have run its course (even as it remains a developing nation in many respects).25 Meanwhile, the EU's sovereign debt crisis has revived the question of whether the organization has expanded too far and too fast, and underlined its frailty.26 At the same time, the U.S.'s fiscal and trading position is widely viewed as unsustainable, endangering its international preeminence. If and how these three actors will ultimately resolve their problems also remains to be seen.

5. Resource Politics Never Went Away-And Have Become Only More Pressing.
Since the 1970s a combination of theorizing about economic production shifting its focus from tangible goods to information; technological hype about everything from new energy sources and materials science to the prospects for accessing the resources of the seas and outer space; and optimism about the power of markets to overcome all problems; combined to form a Cornucopian outlook holding that ecological "limits to growth" are irrelevant. In the late 1990s a spurt of rapid American growth widely associated with the "New Economy" seemed to validate this thinking.

The period's low commodity prices also helped. However, the subsequent price shocks (exemplified by rises in oil prices, sparking a "food and fuel crisis" in 2006-8 and contributing to the 2008 financial crisis), have been a reminder that the world economy remains dependent on the Earth's limited natural resource base.27 Indeed, the growth in the consumption of natural resources increased steadily, so that the world economy was using the resources of 1.2 "Earth-equivalents" by 1999 and 1.4 by 2008, while being likely to consume that of two Earths by 2030 given present trends.28 Where energy specifically is concerned, the evidence for a "significant, prolonged and continuing contraction in production . . . beginning by the 2020s is considerable," with many suggesting that the moment of global "peak oil" may be at hand-while anthropogenic climate change may already be a contributor to economic and political instability.29

The realities of resource politics have also been a reminder of one important limit to globalization-the susceptibility of natural resources (e.g. oil and gas) to territorial control. Consequently, energy exporters have not only enlarged their earnings, and translated oil and gas reserves into financial and political influence, including their ownership of foreign assets. (Russia is the most dramatic such case, but this pattern extends to Saudi Arabia, the United Arab Emirates, Iran and Venezuela, among others.) State-owned oil companies and the sovereign wealth funds of such states have been so prominent in this process that some observers speak of a "return" of state capitalism.30

The same high energy prices also changed the trade balances of energy consuming states in exactly the opposite way (net oil imports adding nearly $490 billion to the U.S.'s trade deficit in the record year of 2008), while driving their governments to be more active in securing the energy supplies on which their countries require.31 American and Chinese actions in this area get the most attention, but every major country has been involved in such maneuverings, some quite surprising, like France's establishment of a base in the UAE in 2009.

6. International Cooperation on Global Issues (Freer Trade Apart) Has Proven Consistently Disappointing.
The Cold War's end saw nothing comparable to the hopes for world government that ran so high after World War II. Yet, there was widespread anticipation of a new era of routine, institutionalized, effective international cooperation across a gamut of issues based on an enlightened recognition of shared interests, a respect for international law-and an enlarged conception of security, beyond traditional physical threats to states. There was much talk of a new era of collective security, with the international community working through the UN to counter not only interstate aggression, but extreme human rights abuses, state failure and other humanitarian disasters (as in the Horn of Africa and the Balkans). The end of the superpower arms race opened up a new opportunity for curbing nuclear proliferation, and there were indeed massive reductions in the American and Russian stockpiles, as well as a new Comprehensive Test Ban Treaty (CTBT). The 1992 Rio Summit formally extended international cooperation into the area of development and environmental protection, with the 1997 Kyoto Protocol and the 2000 Millennium Declaration in New York building on it.

By and large, the envisaged cooperation never materialized. Almost as if the Cold War continued, the U.S. has routinely been at odds with Russia and China at the United Nations (as over the Balkans and the Persian Gulf). The international community demonstrated little appetite for messy and open-ended humanitarian interventions and nation-building projects. Rwanda was the most conspicuous failure to act, but the broader problem is manifest in a "deficit" of peacekeeping efforts, and such action as has been forthcoming tended to be belated and inadequate.32 In the nuclear arena, not only did the CTBT never enter into force, but the attainment of the more ambitious goals of the 1968 Nuclear Non-Proliferation Treaty, with its aim of eventual disarmament, are as remote as ever. Meanwhile India and Pakistan made their nuclear status official, and North Korea tested its first bombs. At the same time, progress toward the goals of the Kyoto Protocol and the Millennium Declaration (or even Rio)-modest to begin with-has been lackluster, with developed nations falling short of their commitments, much of what improvement occurred in these areas coming from sources other than the promised action.33 Moments of crisis produced closer collaboration, as in the aftermath of the September 2001 terrorist attacks, or the 2008 economic crisis, but always within limits, freer trade ultimately the sole area in which international cooperation has been consistently forthcoming and advancing.

In retrospect, such disappointments seem all too predictable, those hopes for enlarged cooperation having assumed an implausible break with established behavior. Yet, the point that no such change actually occurred is too important to overlook given the global nature of the economic and security problems the world now confronts.

Conclusions and Implications
Relative calm has prevailed among the great powers since the demise of the Soviet Union. Large-scale warfare remains a possibility, but by and large interstate war was confined to the margins of the international system, and limited in intensity, while the operational realities of the major armed forces are characterized by alternative missions. Neoliberal globalization has been robust but economically problematic, characterized as it has been by slow growth, financial instability, and other contributions to social and political stresses. East Asia, and especially China, exceptions to the slow growth prevailing in these decades, massively increased their share of world manufacturing, exports and exchange reserves, while the EU expanded and consolidated the continent's resources, with some "game-changing" implications (like the euro). Additionally, rising commodity prices have resulted in booms among resource exporters, and particularly energy exporters, which have also enjoyed greater political leverage.

As a result, while the U.S. remains in a class of its own with regard to military power, and the single largest national market, there have been substantial shifts in economic power from the U.S. (and Japan) to other actors during the last two decades, particularly China, the EU and a select number of energy exporters (particularly Russia), resulting in a more complex and diffuse distribution of power. At the same time the relations of the major powers are less defined by concerns about traditional, state-centered threats than at any time since the nineteenth century, if not earlier, while they together confront an unprecedented array of non-traditional security concerns in areas like energy, the environment and finance, and physical threats from non-state actors like international terrorism and high-seas piracy. Despite this, they have consistently fallen short of the levels of cooperation hoped for in the early 1990s.

Many of these trends seem likely to continue through the foreseeable future. Yet the interaction of the crises of the past several years (especially in energy and international finance) with long-mounting stresses in the global economy (slow growth, debt, ecological pressure) raise the possibility of changes in some of these lines of development, particularly through their impact on the world's three principal loci of economic power: China, the EU and the U.S.. China may continue to grow quickly, though perhaps less quickly as it matures, and pursues goals beyond mere GDP maximization. Even if the EU's integration and expansion recedes (as is plausible), Europe as a whole is likely to remain powerful, even if that power is less extensive and organized.

Meanwhile the U.S.'s position is not unlike what the "declinists" of the 1980s and early 1990s anticipated, the most significant direct challenges to the U.S. twenty years after the Cold War not military, but economic: deindustrialization, balance of payments problems and debt, inside an ever-more integrated global economy and an ever-more strained ecosystem. Relations among the great powers may yet grow more aggressive, but economic crisis seems the most likely cause for such a turn, and these less traditional dimensions of security the most pressing obstacles to the U.S.'s freedom of action in such a turn, so that the possibility does not fundamentally change the situation.

Accordingly, the logical focus for U.S. policy is the correction of the country's balance of payments problems on a fiscally and ecologically sustainable basis. China's shift away from an export-oriented strategy may offer some relief in this area, but economically heterodox action will be vital, including the establishment of an energy policy aimed at sharply reducing oil imports (and ultimately dispensing with fossil fuels); and an industrial policy which expands American manufacturing in proportion to the rest of its economy (to 16 percent of GDP as a minimum, short-term goal), as the overall economy grows.34

Rebuilding the country's long-neglected infrastructure (not least its energy and transport systems), and investment in the research and development of alternative energy sources (especially renewable energy)-projects far larger in scale than anything provided for under recent stimulus schemes-are obvious courses. More broadly, there should be an emphasis on supporting capital- and knowledge-intensive industries reliant on proprietary know-how "acquired only by dint of many years of learning by doing," these being areas where advanced states still can establish long-term comparative advantage; and on restoring the competitiveness of U.S. manufacturing outside the defense and aerospace sectors.35

Of course, financing the needed investments is a daunting problem given the currently massive Federal deficit, the limited options for cutting spending or increasing revenue, and the fact that meaningful results may take years to begin appearing.36 Additionally, it is difficult to imagine successful "reindustrialization" without the reining in of speculative finance (as the U.S. did successfully in the 1930s), and a closer management of trade (to create a space in which recovery is possible). Finally, it is difficult to see such a program being pursued separately from a broader, sustained effort to redress the imbalances and vulnerabilities of the international economic system, the need for which is underscored not only by the crises of the last several years, but the limits of governmental responses to them. Right now much of this seems impossible, but the alternative may prove intolerable.

NOTES
1 As discussed here the "Great Powers" are the United States, China, Russia, Japan, India and the European Union or its most powerful members (e.g. Germany, France and Britain).
2 The 1991 Sino-Soviet Border Treaty paved the way for the resolution of the Sino-Russian territorial dispute, and subsequent widened cooperation. China and India established a framework for resolving their border dispute in 2004, which has also been a basis for widened trade and cooperation.
3 See Richard C. Bush, "China-Japan Tensions 1995-2006: Why They Happened, What to Do," Brookings Institute Policy Paper 16, Jun. 2009, pp. 8-12; Bush, "China-Taiwan: Recent Economic, Political, and Military Developments Across the Strait, and Implications For the United States," Mar. 18, 2010. Accessed at http://www.brookings.edu/testimony/2010/0318_china_economy_bush.aspx.
4 Daniel Dombey and Edward Luce, "Europe Defence Cuts Stoke Pentagon's Fears," Financial Times, Sep. 15, 2010. Accessed at http://www.ft.com/cms/s/0/1c3306d6-c037-11df-b77d-00144feab49a.html.
5 Thomas P.M. Barnett, The Pentagon's New Map of the World (New York: G.P. Putnam's Sons 2005), pp. 149, 161.
6 Some 167 wars broke out in 1945-1989 period (an average of 3.8), and 76 wars in 1990-2007 (or 4.5 annually). The same periods saw 110 and 63 intra-state conflicts respectively (a 50 percent rise in incidence); and 29 and 9 outbreaks of interstate war (a roughly 20 percent drop). See "Appendix A: Chronological List of All Wars," Correlates Of War Home Page, Mar. 2010. Accessed at http://www.correlatesofwar.org/COW2%20Data/WarData_NEW/WarList_NEW.pdf.
7 Battle-deaths fell from a Cold War (1950-1989) average of 180,000 a year to 72,000 a year afterward (in 1990-2007). Calculated from "Average Number of Battle Deaths from State-Based Armed Conflicts per Year per Million of World Population, 1950-2007," Human Security Report Project. Accessed at http://www.hsrgroup.org/our-work/security-stats/state-based-battle-deaths-year-million-population.aspx.
8 Lester Thurow, Head to Head: The Coming Economic Battle Among Japan, Europe and America (New York: Warner, 1993), p. 16.
9 Calculated from United Nations, "GDP/breakdown at constant 1990 prices in US Dollars (all countries)," National Accounts Main Aggregates Database. Accessed at http://unstats.un.org/unsd/snaama/dnllist.asp. Also see World Trade Organization, "Trade to Expand by 9.5% in 2010 After a Dismal 2009," press release, Mar. 26, 2010. Accessed at http://www.wto.org/english/news_e/pres10_e/pr598_e.htm.
10 See John Ralston Saul, The Collapse of Globalism: And the Reinvention of the World (New York: Overlook Press, 2005). For such a reading of the 2008 crisis, see Rob Voz, Richard Kozul-Wright and Alex Izurieta, "Bubbles, Busts, and Bailouts—Lessons From the Global Financial Meltdown," United Nations-Department of Economic and Social Affairs Policy Brief No. 9, Nov. 2008, p. 1. Accessed at http://www.un.org/en/development/desa/policy/publications/policy_briefs/policybrief9.pdf.
11 Calculated from World Trade Organization, "World merchandise exports, production and gross domestic product, 1950-2006," International Trade Statistics 2007, Table A1a. Accessed at http://www.wto.org/english/res_e/statis_e/its2007_e/its07_appendix_e.htm; and U.S. Census Bureau, International Data Base, "Total Midyear Population for the World: 1950-2050." Accessed at http://www.census.gov/ipc/www/idb/worldpop.php.
12 See Alan Freeman, "Globalization: economic stagnation and divergence," Munich Personal RePec Archive, Jan. 20 2008. Accessed at http://mpra.ub.uni-muenchen.de/6745/1/MPRA_paper_6745.pdf.
13 The gross debt-to-GDP ratio of the Group of Seven (G-7) industrialized countries rose from 38.4 to 84.1 percent in 1974-2008, and 96.7 percent by 2009. Department of Finance, Canada, International Fiscal Reference Tables, Table 56. Accessed at http://www.fin.gc.ca/frt-trf/2010/frt-trf-1009-eng.asp#tbl56. For context, see Nader Elhefnawy, "Societal Complexity and Diminishing Returns in Security," International Security 29.1 (Summer 2004), pp. 152-173; Elhefnawy, "National Mobilization: An Option in Future Conflicts?" Parameters 34.3 (Autumn 2004), pp. 122-133.
14 Office of Management and Budget, Budget of the U.S. Government, Fiscal Year 2011, Historical Tables, Table 1.1. Accessed at http://www.whitehouse.gov/sites/default/files/omb/budget/fy2011/assets/hist.pdf.
15 Department of Finance, Table 56.
16 See Benjamin Barber, Jihad vs. McWorld: How Globalism and Tribalism are Reshaping the World (New York: Ballantine, 1996).
17 In 1992 the U.S., Japan and Germany accounted for 48.7 percent of Gross World Product (with 25.3 percent, 15.1 percent, and 8.3 percent respectively), and 50.7 percent of the world's manufacturing output (U.S. 21.6 percent, Japan 19.4 percent, Germany 9.7 percent). In 2008 they produced 37.2 percent of GWP (U.S. 23.2 percent, Japan 8 percent, Germany 6 percent), and 35 percent of world manufacturing output (U.S. 17.6 percent, Japan 10 percent, Germany 7.4 percent). Calculated using data from UN, "GDP/Breakdown at current prices in U.S. dollars (all countries)," National Accounts Main Aggregates Database. Accessed at http://unstats.un.org/unsd/snaama/dnllist.
18 Ibid.
19 Asia's share of global manufacturing rose from 32.2 to 39.8 percent in the 1992-2008 time frame (and its share of GWP, from 26.1 to 27.5 percent). Calculated from UN, "GDP/Breakdown, current prices." Additionally, six of the world's ten largest reserves of foreign exchange (China, Hong Kong, Japan, Taiwan, South Korea and Singapore) are in this region. Central Intelligence Agency, "Reserves of Foreign Exchange and Gold," The World Factbook. Accessed at https://www.cia.gov/library/publications/the-world-factbook/rankorder/2188rank.html. (By contrast, the impact of "emerging markets" like Brazil and India has been limited.)
20 In 1992 the 12 original members of the EU produced 28.6 percent of world manufacturing. These countries' share fell to 22.6 by 2008, but the EU's newer members bring the total to 27.1 percent. Calculated from UN, "GDP/Breakdown, current prices."
21 U.S. GDP was 31.3 percent of the world total in 1970, and 23.2 percent in 2008. The U.S. share of world manufacturing dropped more sharply, 28.4 to 17.6 percent in 1970-2008. Calculated from data from UN, "GDP/Breakdown, current prices."
22 Manufacturing generated 24.1 percent of U.S. GDP in 1970, 17.1 percent in 1992 and under 13 percent in 2008. By contrast, manufacturing still accounts for 21 percent of German and Japanese GDP in 2008 (versus 24 and 26 percent in 1992, respectively). Ibid. 23 Data on trade deficits calculated from Bureau of Economic Analysis, "Gross Domestic Product," National Economic Accounts, Table 1.1.5. Accessed at http://www.bea.gov/national/nipaweb/TableView.asp?SelectedTable=5&FirstYear=2009&LastYear=2010&Freq=Qtr.
24 Put another way, the "capital account surplus" does not cancel out the trade deficit, but is rather part of the same problem. See Richard Duncan, The Dollar Crisis: Causes, Consequences, Cures (Singapore: John Wiley & Sons Pte Ltd., 2003); Wayne M. Morrison and Marc Labonte, "China's Holdings of U.S. Securities: Implications for the U.S. Economy," Congressional Research Service, Jan. 8, 2009. Accessed at http://fpc.state.gov/documents/organization/99496.pdf.
25 Alexandra Harney, The China Price: The True Cost of Chinese Competitive Advantage (New York: Penguin, 2008). Kai Guo and Papa N'Diaye, "Is China's Export-Oriented Growth Sustainable?" International Monetary Fund Working Paper, Aug. 2009. Accessed at http://www.imf.org/external/pubs/ft/wp/2009/wp09172.pdf. Zhang Xiang, ed., "CPC Central Committee's Proposal for 12th 5-Year Plan," English.Xinhuanet.com, Oct. 27, 2010. Accessed at http://news.xinhuanet.com/english2010/china/2010-10/27/c_13578354.htm.
26 See Paul Krugman, "The Road to Economic Crisis is Paved With Euros," New York Times Magazine, Jan. 12, 2011. Accessed at http://www.nytimes.com/2011/01/16/magazine/16Europe-t.html?_r=3&ref=magazine.
27 John Baffes, "Placing the 2006/08 Commodity Price Boom into Perspective," Prospects for Development: a Forward Looking Analysis of the Global Economy, Jul. 26, 2010. Accessed at http://blogs.worldbank.org/prospects/placing-the-200608-commodity-price-boom-into-perspective. Food and Agriculture Organization of the United Nations, The State of Food Insecurity in the World 2009 (Rome: Electronic Publishing Policy and Support Branch, 2009). Accessed at http://docustore.wfp.org/stellent/groups/public/documents/newsroom/wfp209430.pdf. James Hamilton, "Causes and Consequences of the Oil Shock of 2007-08," Brookings Papers on Economic Activity, Mar. 23, 2009. Accessed at http://www.brookings.edu/economics/bpea/~/media/Files/Programs/ES/BPEA/2009_spring_bpea_papers/2009_spring_bpea_hamilton.pdf.
28 Worldwatch Institute, ed., Vital Signs, 2003: The Trends That Are Shaping Our Future (New York: W.W. Norton & Co., 2003), pp. 44-45. World Wildlife Fund, Living Planet Report 2008. Accessed at http://assets.panda.org/downloads/living_planet_report_2008.pdf.
29 Nader Elhefnawy, "The Impending Oil Shock," Survival 50.2 (April 2008), pp. 43-45. For a discussion of climate change, see Global Humanitarian Forum, The Anatomy of a Silent Crisis, Human Impact Report, 2009. Accessed at http://www.eird.org/publicaciones/humanimpactreport.pdf.
30 Ian Bremmer, "The Return of State Capitalism," Survival 50.3 (Jun.-Jul. 2008), pp. 55-64.
31 Michael T. Klare, Blood and Oil: The Dangers and Consequences of America's Growing Dependency on Imported Petroleum (New York: Henry Holt & Co., 2004); Klare, Rising Powers, Shrinking Planet: The New Geopolitics of Energy, pp. 20-26. Also see Nader Elhefnawy, "The Impending Oil Shock," Survival 50.2 (April 2008), pp. 37-66.
32 See Michael O'Hanlon and P.W. Singer, "The Humanitarian Transformation: Expanding Global Intervention Capacity," Survival 46.1 (Spring 2004), pp. 77-99; Richard Gowan, "The Strategic Context: Peacekeeping in Crisis, 2006-2008," International Peacekeeping 15.4 (August 2008), pp. 453-469.
33 Despite European cuts in CO2 emissions, world emissions are 35 percent higher in 2007 than 1990 (due to growth in the U.S. and developing nations)-even with industrial collapse in the Soviet bloc. Additionally, developed countries generally failed to devote the promised 0.7 percent of their Gross National Income to Official Development Assistance (the figure realized being closer to 0.31 percent). The reported poverty reduction is concentrated in fast-growing East Asia, while "sub-Saharan Africa, Western Asia and parts of Eastern Europe and Central Asia" will not meet their targets. United Nations, The Millennium Development Goals Report 2010 (New York: United Nations, 2010), pp. 7, 53, 66.
34 For elements of such an energy policy, see Elhefnawy, "Toward a Long-Range Energy Security Policy," Parameters 36.1 (Spring 2006), pp. 101-114; Elhefnawy, "Impending Oil Shock."
35 Eamonn Fingleton, In Praise of Hard Industries: Why Manufacturing, Not the Information Economy, is the Key to Future Prosperity (Boston: Houghton & Mifflin, 1999), p. 19.
36 Elhefnawy, "National Mobilization." Also see Christopher Hood, "The Tax State in the Information Age," in T.V. Paul, John A. Hall and G. John Ikenberry, eds., The Nation-State in Question (Princeton, N.J.: Princeton University, 2003).

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