World power shifts as US and China finish talks
This year the GDP of emerging economies will outstrip that of the advanced. As the leaders of each bloc’s greatest powers meet, will the new balance of power lead to wealth or war?
As their two day meeting came to an end, US President Barack Obama and China’s Xi Jinping seemed cheerful and relaxed. The talks between the world’s two greatest powers had been ‘constructive’ and ‘unique’. But behind the scenes a major geopolitical upheaval is taking place.
For the first time, emerging economies – led by huge fast-growing countries like Brazil, India and China – will very soon be responsible for a greater share of the world’s production than the old ‘advanced’ economies in Europe, North America and the Far East.
The balance of economic power is shifting. For decades, our planet has been dominated by a handful of economic powers, with the USA far in the lead. Now, the rest of the world is catching up.
In many ways this is clearly a good thing. Poor countries getting richer means people being lifted out of poverty and deprivation. It means mortality rates dropping, literacy rising, quality of life improving.
And economic power is not what economists call a ‘zero sum game’. In financial terms, when poor countries get richer, everyone can win. The US economy, for example, has done very well by exporting hi-tech goods to newly wealthy consumers in India and China. Emerging economies are claiming a bigger share of the world’s wealth, but since the total wealth keeps on growing, there is more than enough to go round.
A greater spread of wealth should also help drive science and innovation. People who escape from poverty get a better education; they are more free to enrich the world with new thinking and new ideas. The more people taking part in the global conversation the better.
But not all resources work this way. Food, for example, is already in relatively short supply. The situation will get much worse as emerging world consumers start eating more meat, which takes much more land to produce. Energy is also a limited resource, for the moment at least. It will be hard to meet emerging energy needs without running out of fossil fuels, or wrecking the planet in the process.
Then there is the most limited resource of all: geopolitical power. This is the ultimate zero sum game. Only one country can lead the world. For every winner there is a loser too.
This makes rebalancing dangerous. Peace is easy when one peaceful nation is in the lead, but when two or more countries have equal power, each fears the other. Each tries to stay ahead militarily. Defensive moves are misread as offensive threats. Before long, rivalry can turn into all out war.
But perhaps the wars of the past need not repeat themselves. The 20th century was devastated by great power conflicts. Surely, say optimists, the lessons of history can help us avoid the same fate in the 21st!
- Do you think there will ever be a third world war?
- The USA has led the world for decades. Has it done a good job?
- What do you think are the scarcest resources in the world? List your top five, then compare with others in the class.
- Write a fictional account of events leading up to the beginning of World War III.
Some People Say...
“Human nature makes war unavoidable in the end.”
What do you think?
Q & A
- Luckily I’m not a world leader so I don’t have to worry about such things.
- You should be at least a little worried about the idea that there might ever be another world war. Apart from the terrible violence, such a conflict would also ruin the world economy. Life would get very hard and very poor, very fast.
- Fine, but I don’t see that happening anytime soon.
- Many people in 1937 or 1938 thought similarly. The Second World War broke out in 1939. But anyway, these power games matter in other fields too.
- How so?
- You can see it in offices and playgrounds all over the world. When there is a clear leader, there is order and peace. But when the leader feels threatened, he or she starts behaving aggressively. If someone is rude to you in life, it might just be that they feel threatened.
- The world’s production
- The usual way or measuring economic output is by counting Gross Domestic Product, or GDP. A country’s GDP is the amount of money that was spent on goods or services in that country in a given year, and gives a rough idea of how much useful ‘stuff’, broadly understood, that country was producing.
- In the 1950s, the world’s centre of economic gravity was somewhere near Iceland, poised between Europe and the US. Currently, it is moving rapidly eastward, and by 2025 it should have reached central Asia, around the Siberian town of Novosibirsk.
- Zero sum game
- The term ‘zero sum’ is taken from a branch of maths called ‘game theory’. It means that the players of a given game will have the same total resources at the game’s beginning and at its end, although the distribution of those resources might change. In a positive sum game, the sum total of the resources will grow: everyone can be a winner. In a negative sum game, the sum can shrink, which means everyone can lose. Most wars are negative sum: both sides lose, and the ‘winner’ is the one who loses least.
- Wars of the past
- In history, where two or more powers have been on an equal footing, war has usually been the result. Athens and Sparta were equal allies against the mighty Persians, but when the Persians were gone, they fought each other for dominance in Greece. When the German navy grew as large as the British navy at the beginning of the 20th Century, an arms race began. This was one of the causes of the First World War. In the 1960s and 70s, a third world war between Russia and the USA was only averted by the threat of nuclear holocaust.