Fareed has spent the majority of this book exhaustively analyzing the forces behind the Rise of the Rest and the theories of post-Americanism and globalization in the context of the rest of the world, but it is very necessary to bring things back full circle and discuss America's position in the Rise of the Rest. After all, it is the American transition or better yet, how America chooses to handle its own transition from Global Leader to Global Player that will cause the biggest splash in the pool.
To be honest, the "Team America: World Police" [1] theme song jumped into my head and played on repeat almost constantly as I read through this chapter, but Fareed uses this chapter to draw a less satirical, much more meaningful comparison to the current and future state of the American position in the world order than Trey Parker and Matt Stone did.
Fareed kicks off this chapter with a vivid and stirring description of the 'Diamond Jubilee' a celebration that occurred on June
22nd, 1897. The event marked the sixtieth anniversary of Queen Victoria's ascension to the British throne [2]. An imperial military procession of fifty thousand troops (with units from every corner of the empire) escorted Queen Victoria to the Mansion House in London (pictured) and it truly was an event of Imperial splendour and decadence. The event was not just celebrated in London, but was marked with festivities occurring across the entire expanse of the British Empire [3]. It seemed like the British Empire was never ending and that the fading of the empire was an impossibility, but as we all know, history happened and the British Empire did fade. Imperial Britain at the height of its power and influence is the closest modern historical comparison that can be made to America in the present and from this, we are faced with the question of "Will history happen again?"
I mentioned in previous chapters the central challenges faced by Beijing and New Delhi as a result of the rise of the Rest and Washington, too, does have a central challenge that will define its own transition within the rise of the Rest. "If history does happen again, as many expect it to, how will Washington handle the change?" One important distinction that Fareed makes about this question and his analogy to the British Empire is that the central challenges facing Britain during her decline were economic rather than political, however the reverse is true for America [4].
http://upload.wikimedia.org/wikipedia/commons/2/26/The_British_Empire.png
I referenced the above link in Chapter 3 and i'd like to draw upon it again. All the lands in pink were at one point under the administration of the British Empire...around a quarter of the Earth's land surface and about a quarter of its population. Much like America today, the Empire was linked with a network of territories, bases and ports spread across the entire globe and protected by one of the strongest military forces the world had ever seen. Through all of this, Britain created the world's first truly global market and as we know, facilitated the spread of its institutions, ideals, language and practices. We can compare this with America's current establishment of soft-power and the spread of globalization and Americanism that we see today. Despite its massiveness and the spread of its control, the cracks had already begun to form.
Much like the invasion of Afghanistan in 1979 spelled the out the beginning of the end for the Soviet Union as a world power, the end of the British Empire began with war on the horizons. In 1899, Britain launched a military adventure into South Africa. Interestingly enough, the Boers adopted a successful campaign of guerrilla tactics against the British however, in 1902, their insurgency was in its last throes and the Boers surrendered. While the war was, technically speaking, a military victory for the British in that their armed forces defeated the armed forces of another, the war had high costs for Britain and to call it a victory for Britain in any other sense is absurd. Britain had lost 45,000 soldiers, spent 500,000,000 Pounds, stretched their army to the breaking point and most importantly, sacrificed their moral standing in the world order due to their severe military tactics [5]. It's obvious to see the direct comparisons that can be made with America today and from this, we can see that history is indeed being repeated and in the grand scheme of the world order, 'Imperial' America is in "decline." HOLD UP! I know what you're going to say!! Right at the beginning of Chapter 1, it was said that this book is not about the decline of America...and that's true! Decline is surrounded by quotations because it is a topic that does require further discussion. Save your thoughts...i'll return to the idea and topic shortly.
Before diving deeper into what this comparison means for America today, Fareed wants to understand exactly how the British became the dominant force of the west and more importantly, how the British Empire handled their own decline. Understanding the history of the decline of the British Empire could prove very valuable if one hopes to understand and successfully weather the "decline" of America today...so let us have a look at exactly how the Brits came to be.
Take a minute and scroll up toward the top of this post. Take a look at that picture of the 1897 Diamond Jubilee. It's okay, I'll wait...I don't mind...I'll hum out a song that's stuck in my head (Jigsaw falling into place by Radiohead...i'm really on a radiohead kick right now...)
...
Did you have a good look at that picture?
The scale of this celebration is pretty massive...it's pretty grandiose and quite the spectacle...Now just keep in mind that it's in EIGHTEEN NINETY-SEVEN, over 120 years ago. It's hard to even think of a current event that would match the scale of the Diamond Jubilee (Dick Clarke's Rockin' New Years Eve?...or maybe the Inauguration of my good friend Barack...but even he didn't get a flotilla of 165 modern warships standing by...) The point is, as grand and marvellous as this all was, the best years of the British Empire were already long passed, the real zenith of the empire being 1845-1870, when Britain accounted for 30% of world GDP with only 2% of world population [6]. That being said, Britain's time as an economic superpower was rather short considering the timeline of its empire and thus, the central feature outlining the decline of the British Empire is economic decline.
In 'Ye Olde Days,' manufacturing was still considered the bulk driving force behind a national economy and while Initially, Britain dominated...but was soon surpassed and Fareed identifies an almost poetic trend that really describes the end of the empire quite well. "...the goods Britain was producing represented the past rather than the future. In 1907, it manufactured four times as many bicycles as the United States, but the United States manufactured twelve times as many cars" [7]. From this statement, we can extrapolate that Britain began to lose its economic focus as its empire aged. Britain remained focused on small, 'cottage' scale industries while other nations shifted their focus to mass-production and heavy industrialization and
at the same time, British capitalism remained very conservative and while investment was high, the financial
industry plateaued and 'modernization' stopped. "Having spearheaded the first industrial revolution, Britain had been less adept at moving to the second" [7], (Recall from Chapter 2: "...the United States succeeded in its great historic mission - it globalized the world. But along the way (...) it forgot to globalize itself.) Basically, from this quote we take that Britain failed to continue its innovation and stay on the leading edge of modernity, and allowed other countries of much larger size to catch up and overtake the empire, and Gordon Brown does not approve (as we can see.)
A unique and very important point was that through all of this, Britain managed to remain a politically powerful nation. Consider during World War II, America paid most of the economic costs of the war and Russia, the majority of the human casualties and yet, in the end, Britain still had a large role in the Yalta conference. This feat of political manoeuvring owes a large amount of its success to ONE key decision made many years ago (well, there's more to it than that, but this decision is a very important part.)
In the early 1900s, Britain was able to SEE that the tides of change were flowing from London and to Washington. The critical decision of accommodating the rise of America rather than opposing it was likely a difficult one for London to make...an Imperial power allowing a former colony to gain such control was probably a big hit to the ol' British pride, yet the Britons of the time understood that if they opposed the rise of America, they would be bled dry. By positioning themselves to accommodate the rise in American influence, Britain freed large amounts of resources which it could then use to continue to exert its influence and control elsewhere (such as the maintained dominance in shipping and naval strength.)
In the end, Britain maintained great global influence even though it was economically, very weak and it realized this and played this declining hand with great skill. The lessons that can be learned here can very much apply to the situation that America is facing and again, in order to weather these changes successfully and remain competitive and even competent at functioning in such a market, we must learn what we can from history. So how does this all apply to America?
Mmmmm...look at that piece of American glory right there? I should not be writing this when I'm hungry...
Moving on, it's essential to note that the central feature of English decline (economic weakness) doesn't really apply to America (with burgers like that...you better believe the economy is good!) America has been the world's go-to-economy&GDP-guy for the last 130 years, and for the most part, it is positioned to continue to hold this spot for many years to come (China still has a long way to go, as we covered back in Chapter 4. Their burgers suck, too.) Fareed highlights an additional significant difference between
America and the British Empire that we must observe to get a better understanding of the situation. Military Budgets. I've mentioned several times that the Royal Navy ruled the Sea like it "ain't no thang" but it really actually was a "thang" and the cost of maintaining such a fleet placed a tremendous burden on the royal coffers. Without being in the water, the Brits really weren't much of a threat. Compare that today with America, who dominates at every level of military industry and possesses tremendous research capacity to further that gap in dominance, and yet, even though the United States makes up almost half of global defence spending [8], it's not really breaking the bank all that much. Yeah, we can argue about deficits and Chinese loans until we're blue in the face but the fact of the matter is, America drops a pretty hefty chunk of change on its military development and endeavours but the fact of the matter is that it can afford it...more or less, anyways. More so than Britain could afford that navy. This serves to isolate the fact that the economic base that America is built upon (the military being built upon the same base) is incredibly strong...much more so than Britain's ever was or could be.
Jumping to my first point of reference ("decline" of America), yeah, you're right, that's not what this book is about. However, as the pie gets bigger and the Rest rise and begin to catch up and modernize, America is bound to lose some of its share of that global pie...there's nothing that can be done about it. So America will decline, but the country is also faced with the potential opportunity to change the definition of decline so that it's no longer decline in a negative, traditional sense, but something else entirely. Let us dig a bit deeper...There's an example that Fareed utilizes that i'd like to briefly steal, and it deals with the American education system. A 2005 'National Academy of Sciences' report stated that in 2004, China unleashed about 200,000 engineers upon the world from its educational institutes and India also trained about 120,000 engineers. During this same time period, the United States released about 70,000 engineers from its universities [9]. The report then went on to say that America is at a potential to lose its leading edge in science and technology as a result (recall losing its edge is what contributed to sinking the British Empire.) However, what we need to consider is that higher education is one of the things that America does best, having 42 out of the 50 top ranked educational institutes in the world (or 68%, depending on which study you decide to read. Regardless of which one you take, America dominates the education game.) Going even further, the American educational system (including grade school) is one that teaches the student to THINK, to imagine, to wonder, to question, to try and fail. This system differs from that in many other countries, which teaches students to memorize information, regurgitate information and then forget that information. It is this form of 'ingenuity' teaching, combined with the extreme quality of the American post-secondary education system that keeps America dominating. However, as the Rest have begun to rise, they have observed from America, the values of the American education system and implemented similar systems back home and as a result of this, the rest are getting better. Apply this to many other elements of the world system and we start to acquire a bigger picture of what is happening. Yes, as the world economic pie grows larger, America will be eating a smaller slice, hence..."decline." But when we consider that what's causing this "decline" isn't that America is slipping behind, but that the rest of the world is starting to catch up and to prosper...it's no longer really a "decline" any more, is it? The improving fortunes of the globe as a whole don't spell doom for America, but rather the entrance to a new and improved quality of life for everyone.
Asia is still full of developing countries that are lightyears behind America in terms of economics and technical capability, but the countries of the European Union are much more advanced and the Union as a whole represents much stronger competition in the economic field. However, America also has an ace up its sleeve and as this ace is played (it's been in the process of being played since America's birth) it will shape how Washington responds to the rise of the Rest and handles the American transition, yet it gives America a significant advantage over Eur
ope and most of the developing world. So what is this magical ace in the hole that will help keep America at the top for years to come? The United States is demographically vibrant and more importantly, population continues to swell and the young continue to outnumber the old. When compared to Europe, their population is predicted to remain stagnant and aging, with the ratio of working-age people to senior citizens expected to fall to 2.4:1 in 2030 (compared with 3.8:1 today. For the USA, we have values of 5.4:1 today and 3.1:1 for 2030) [10]. Basically, Europe is moving toward a position where it is taking in less people when it needs to be taking in many more, where as America continues to grow and to absorb people, creating a more or less universal culture that continues to work together in harmony.
In most of the world, developing or not, West or Rest, the demographic situations are similar. Birth rates in many Asian countries are in decline and the effects of an aging population are rather strong and considerable in the context of economic development. We've got a larger pension and medical care burden, and Fareed points out that economist Benjamin Jones states that as a population ages and begins to work less, innovation drops. The effect of a large number of people transferring from net savers to net spenders can also cause havoc on the national scale for savings and interest rates. The solution for the growing demographic problem is at this point unclear (Shipping all the old people out to sea remains a distant plan B) [11]. What really works to keep America ahead is its immigration. America feeds off of this immigration and even as the country grows wealthier (and in most cases, lazier and less driven to succeed), America has been able to revitalize itself, assimilate its immigrants and drive the population as a whole to work together to constantly 'stay ahead' on the global development game...however it's not all 'peachy-keen' and there are troubles brewing in America that can cause the country as a whole to lose this edge.
Recall in Chapter 2, the reluctance of America to globalize itself and the policies taken by much of the population toward globalization, immigration and so on. On top of this, the declines in the savings rate of both the American population and of the government are putting massive strain upon the country. For all of its strengths outlined above, the American economy is facing its toughest challenge and hurdle in history which is a part of the rise of the Rest. It's important to again remember that this challenge is not a conventional decline and the shrinking piece of the economic pie that goes to America should not be feared. As I mentioned above, the handling of this challenge will prove to make the biggest splash in the global economic pool, and its understandable given that America will have the largest 'drop.'
I mentioned throughout this blog several times that America's divine mission was to globalize the world and the results of decades of American foreign and national policy have resulted in the rise of the Rest. To put it easily, everyone is now playing the game (and playing to win) as a result of America's policies. The financial markets of the rest of the world are growing very quickly and this is driven by the simple fact that there are now options on the global market...It's not just all about New York and the American financial market anymore. Capital markets outside of America have grown massively in the last few decades (due in part to mass privatization of state owned assets that has occurred on a global scale over the same time period) and are just as (if not more) liquid and regulated than the American market. Now that countries and companies have global options, they can invest and operate within other markets that perhaps happen to suit them better. In this rise of globalization, America (or the American way or whatever) has been the global standard but it is no longer, as the rest of the world has started to adopt this global standard as their own. Being held as the global standard and on top for so long has created some distinct disadvantages for America, as Fareed points out.
Being so large and being held as the global standard for doing business, the rest of the world took the time to carefully study both the Americans, but also their economic and corporate systems down to the smallest detail. However, the Americans have not bothered to study the rest of the world or to become familiar with the financial markets and economies that now offer the strongest competition to the American system. The Americans are only able to swim in one sea where as competitors in other markets are able to penetrate both the American system and their own, non-English markets and systems. The all important access to American capital is no longer important when you have a world that is swimming in free floating capital. Fareed notes an important aspect where the comparison of progress and competitiveness is no longer a company comparing with its past, but comparing with others at that same moment...Competitiveness has expanded. It's no longer about Capital and Experience, but now about Ideas, Energy and Efficiency. However, this change of competitiveness has brought further obstacles to the American ability to operate in the post-American world.
I mentioned earlier that the biggest obstacle to the British was one of economics and in America, the political system poses the biggest risk to the success of the American system. I mentioned earlier that there has been the development of a sickly irresponsible political culture within America (in Chapter 2) and from this, Americans are constantly believing that they're "number 1" and are refusing to look to the rest of the world for opportunities and options. The laziness and ineffectiveness of the American political system and the lack (at the time of publishing, anyways) of reform to this system serves to further strip away the competitiveness to the American system (1/3rd of the country's school are garbage, bridges are collapsing and the mortgage deduction costs $80billion/year and really has no affect on the levels of home ownerships [12].) Furthermore, the development of an ineffective political system within America, an antiquated system about money, special interests, media bickering and ideological reinforcement of the lack of bi-partisanship is what is hurting America most. The political process now is a theatre and an ineffective mode at getting things done. This all then relates back to Washington's central challenge in the rise of the Rest...Can Washington handle a world in which others have moved up and it's no longer the sole leader? Can Washington tolerate and even embrace a world in which it is no longer calling all the shots? This remains to be seen and as I mentioned, will potentially be the most tumultuous transition of the rise of the Rest.
References:
F. Zakaria The Post-American World, New York: W.W. Norton & Company Inc., 2008
[1] I wasn't sure if I should post this link here (I like to keep this blog family friendly, you see) But here it is. The link contains all sorts of objectionable words and phrases and very explicit language. Open at your own risk and discretion. It was featured as the main theme song in the 2004 film "Team America: World Police" by Trey Parker and Matt Stone, the creators of the "South Park" television series. I got a laugh out of it when I first heard it and its posted with the sole purpose of entertainment. Again, open (if you wish) at your own discretion. Here we go... http://www.youtube.com/watch?v=YZdJRDpLHbw wait...this won't affect my grade will it?
[2] Pp 167
[3] Pp 167-168
[4] Pp 169
[5] Pp 172
[6] Pp 174
[7] Pp 175
[8] Pp 182
[9] Pp 187-188
[10] Pp 196
[11] Pp 197-198
[12] Pp 208
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