America and the World: Part II. American century or Asian century?

How fares the American Century  is a common question running through our three books. Joseph Nye, in Is The American Century Over?  locates its starting date from February 1941, when Henry Luce, editor and owner of Life magazine, wrote an article that was to become famous, and entitled “The American Century”. Nye answers that it is far from over yet. Amy Chua,in  Political Tribes: Group Instinct and the Fate of Nations, suggests that the US drop its ideological prism of  framing foreign policy in terms of big abstractions-Capitalism or Democracy-and substitutes them  with a more perceptive understanding of the primacy of group identities. Gideon Rachman, in Easternisation: War and Peace in the Asian Century, argues that the enduring challenge to Western power is the rise of Asia. The West still enjoys some residual, institutional advantages, but these do not gainsay the global power shift away from the Atlantic seaboards.


US foreign policy has been an everlasting source of domestic contention, since George Washington’s famous  1796 Farewell Address, when he declared:

“The great rule of conduct for us, in regard to foreign nations, is in extending our commercial relations, to have with them as little political connection as possible. Europe has a set of primary interests, which to us have none, or a very remote relation. Hence she must be engaged in frequent controversies the causes of which are essentially foreign to our concerns. Hence, therefore, it must be unwise in us to implicate ourselves, by artificial ties, in the ordinary vicissitudes of her politics, or the ordinary combinations and collisions of her friendships or enmities … it is our true policy to steer clear of permanent alliances with any portion of the foreign world…”

“We have torn up 150 years of traditional foreign policy,” said Senator Arthur Vandenberg in March 1941 on the occasion of the US Congress’ sanctioning of the Lend-Lease programme with Great Britain. “We have tossed Washington’s farewell address into the discard. We have thrown ourselves squarely into the power politics of Europe, Asia and Africa. We have taken the first step upon a course from which we can never retreat”.

A month earlier, Henry Luce, in his article “The American Century”, called on his fellow Americans “to create the first great American Century” in the spirit of “the triumphal purpose of freedom” “We are not in a war, he declared, to defend American territory.  We are in a war to defend and even to promote, encourage and incite so-called democratic principles throughout the world.”

Is the American Century Over?

The American century’s epitaph, writes Nye, runs: ”Date of birth, 1941. Date of death, uncertain”.The book is an update on his Bound to Lead: The Changing Nature of American Power, which came out in 1991 as a counter to the declinist position of such writers as Paul Kennedy. In The Rise and Fall of the Great Powers: Economic Change and Military Conflict from 1500 to 2000, published in 1987, Kennedy argued that Great Power ascendancy correlates to available resources and economic sustainability; military overstretch and a concomitant relative decline are the prime threats facing powers whose ambitions and commitments outrun what their resource base can provide for. Nye’s 1991 response was that America’s output as a share of the global economy had settled at 25% since the early 1970s, after the reconstruction of the European and Japanese economies, and that the US enjoyed enormous reserves of  “soft power”- language, culture and leadership of alliances and institutions. Compared to other large nations, Nye argued,  the United States stood well. The upbeat conclusion ran: “The United States remains the largest and richest power with the greatest capacity to shape the future.”

Nye argues much the same a quarter of a century later. He starts off by dethroning “the myth of hegemony”: the term is far too vague, and refers alternately to a preponderance of resources, to setting the agenda, and sometimes to achieving preferred outcomes. He prefers to use the term primacy. The US, he points out, was massively preponderant in 1945, with over 50% of the global economy, but realized that it was advisable to ally with the UK, Europe and Japan. During the cold war, the USSR succeeded in constraining the US in the political  and military dimensions of power. During these four decades, the US provided public goods to the members of the club as a security community. These goods definitely did not look benign to non-members, such as India, China or Chile.

Another “unipolar moment” came in 1991 when the US in effect opened the club to a wider, global membership, and stood without equal in the constellation of global power. The US was still closely allied to Europe, Japan and the countries of South-East Asia. It had its finger firmly on the oil well of the world in the Gulf-as Saddam Hussein discovered when he lunged to appropriate Kuwait. In addition, the US ran the uncontested global currency, enjoyed a panoply of the world’s leading corporations, stood at the heart of a set of global alliances and institutions, and was far and away the world’s prime military power. In 1991, the US navy was equal to the next 17 navies together; it enjoyed an overwhelming lead in power on sea, in the air and in space. Underlining this lead, the US military budget was equivalent to 50% of the global total.

Will US primacy still be around in 2041, asks Nye. My guess, he says, is: Yes. In that sense, the American century is not over, but it is changing in important ways, notably with the rise of transnational and non-state actors.

The decline literature, Nye points out, tends to refer to the cycles of the rise and decline of European powers, none of whom are really comparable to the US. Take the UK, the preferred comparator. The UK is a small island; the US is a continent. The UK had an early mover advantage in the industrial revolution, but was overtaken in the late nineteenth century by both Germany and the US. The UK always had powerful neighbours, like Germany, compared to the US’s neighbours of Mexico and Canada. A narrow sea separates the British Isles from the continent, whereas the US is separated from Europe and Asia by two oceans.

Nye rightly observes that the US suffers from a form of collective bipolar disorder, elated at its lead one moment, and wallowing in declinism the next.  Writing in the late 1980s,(“The US-Decline or Renewal?”, Foreign Affairs, 67, Winter 1988/89). Sam Huntington records 5 phases of declinism in the second half of the twentieth century: after the USSR launched its first satellite in 1957; after President Nixon’s announcement in 1969 that the world was now “multipolar”; after the 1973 oil embargo; after Soviet expansion in the late 1970s; and after President Reagan’s dual deficits in the early 1980s. The 1990s, one may add, saw America on a prolonged high, until smitten by 2001, the pricking of the high tech bubble and then by 9/11: again in 2008, after the financial crash, and the years of Obama’s Presidency, when Americans  once again became apprehensive of their country’s position in the world.

As Nye concludes these swings in mood denote more about popular psychology than they do about geopolitics. The danger of these swings in opinion is that they can prompt an overextension of commitments relative to resources, followed by a swing to isolationist and protectionist policies. One step to avoiding these swings in mood is to unbundle two concepts lurking in the word “decline”: the first refers to a decrease in relative external power; the second is domestic deterioration or decay.

Britain’s problem , Nye points out, was relative decline and the rise of other powers. Is that the case of the US? No single country, Nye argues, is likely to surpass the US, but combinations among them may put an end to American pre-eminence. There follow an analysis of possible contenders to US primacy: the EU; Japan, the BRICS (Russia; India; Brasil; and China, the prime contender).  Let us look at these.

  • Europe’s economy is equal to that of the US, and its population numbers 500 million to America’s 310 million. In terms of human capital, technology and exports, Europe, writes Nye, is very mpuch a peer competitor. In military resources, Europe combined spends 50% of the US; both France and the UK are nuclear powers, but they have limited capability to project their military resources. Europe is also very well endowed in soft power.

It is a moot point whether Europe will develop  sufficient cohesion to act on the world stage as a major player. It does so in the WTO, where it is the equal of the US; in the IMF, it is second to America; on anti-trust issues, the European Commission stands toe to toe with the US Justice Department. It is also the world’s largest market; is a major distributor of aid, and fields 27 of the world’s top universities, as compared to the US’ 52 in the top 100 globally. Both the US and Europe invest massively in each other’s economies, and both share common values of human rights and democracy.

That being said, Europe faces significant limits to its degree of unity, he rightly emphasizes. National or local regional identities are much stronger than a common European identity. Europe also faces serious demographic problems, both in terms of low birth rates and in acceptance of immigrants. Europe spends 15% of total military outlays in the world, compared to China’s 11%, but there is no military integration. Europe has enviable “soft” power, but US motion pictures dominate at the box office. Nye’s conclusion is unchallengeable: the probability of Europe contending with the US for primacy is very small; frictions will persist, as in the past; but the benefits from alliance continue to weigh in the scale. If Europe and the US remain allies, he concludes their resources reinforce each other.

  • Japan in the 1980s was the subject of an avalanche of books predicting a Japanese-led Asia Pacific. In 2010, though, China’s gdp overtook Japan’s; the country is not a nuclear power, but does have the just-in-time capacity to develop military capabilities fast; it has demographic problems, and is a volcanic archipelago of 3000 islands. If Japan and China were to ally in opposition to the US, it would represent a potent coalition. But China and Japan have serious disputes over the East China Sea, and both have rival visions of Japan’s place in the world. Given the likely continuation of China’s rise, the more likely outcome is continued alliance with the US.

In traditional balance of power terms, Nye argues, it is important that Europe and Japan remain allied to the US. Together, Europe and Japan provide the largest possible pool opf resources for dealing with growing transnational problems.

  • Russia: In 1959, Nikita Kruschev’s prediction that the USSR would bury the US in a cornucopia of consumer products was one of the factors that prompted the US and western Europe into competitive growthmanship. In 1986n the newly appointed Secretary General Mikhail Gorbachev stated that “we lag in all indices”, and in 1991, the USSR collapsed. In economic resources, Russia’s economy is one seventh of America’s; per capita income is one third; the country is overdependent on oil and gas, and hence very vulnerable to fluctuations on global commodity prices. Russia has a magnificent religious, literature and musical inheritance, but Putin’s message of authoritarian nationalism has limited global appeal. Resources are allocated inefficciently, and Russia ranks 135/180 on the global corruption index. The political instinct for a market economy are missing; the non-Russian population stands at 20% of the whole; the public health system is poor, mortality rates are high, and Russia’s population is shrinking.

Declining powers, Nye warns, can prove disruptive on the international stage. Russia has all the ingredients. Putin feeds the population a diet of anti-liberalism and Russian nationalism. It is a nuclear weapons state, with a considerable arsenal. It also has scale, an educated population, skilled scientists and engineers, and vast natural resources. Were Russia and China to forge an alliancethis would have global significance. But China’s rise since 1990 is dwarfing Russia; the demographic imbalance in the Russian Far East is heavily titled China’s way. In 2009, Russia changed its nuclear doctrine to first use. Analysts believe that the doctrine is directed at China’s conventional superiority in East Asia.

  • India: Since the economic reforms of 1991, India’sgrowth rate has accelerated to 7% per annum; it has a growing middle class; it has excellent technical institutes, and competition in educational achievement is fierce; English is spoken, Nye estimates, by 50-100 million. He could have added that the Indian diasporas in the UK and the US are very successful, and the richest minorities in those two countries. India is a nuclear weapons power, with a missile delivery system, and military personnel of 1.3 million.

But India remains an underdeveloped country: one third of its population live in poverty; literacy lags China’s;  its gdp is one third of China’s, and its per capita income is 15% of the US. Trade is growing with China, but mutual suspicions abound. China lays claims to Indian territory in the Himalayas; all along the mountain chain from Myanmar to Pakistan, their diplomacies rival each other; China dwarfs India by every measure; Not surprisingly, one of the major achievements of the Bush administration was to consolidate a US-India alliance, and that has been compounded by closer relations between India and Japan. In traditional realist terms, India is counterbalancing China as the potential hegemon of Asia.

  • China: I will reserve what Nye has to say about that key relationship to the Part III of my US and the World series. But here are some of his key arguments: China, he maintains, has a long way to go to match US resources, both material and soft power resources. China has still to find a solution to the problem of political participation. To succeed in terms of soft power, it will have to be less threatening to its neighbours; to win over adherents in North America and Europe, it will have to be more critical; in short, its influence will remain limited so as long as nationalism and party control remain strong. Overall, Nye defends the position that China has and continues to benefit by the US-led system, its economy remains highly inter-dependent with the US- and it may be added, Europe; and it has 230,000 Chinese students studying at US universities.

Miscalculation between China and America is always possible, but conflict, he writes, is not inevitable. Not least, China has multiple incentives for restraint, a point I make in this blog.

The real issue for Nye, though, is not the transition of power among states, but a diffusion of power away from all governments. This is a point which the late Susan Strange reiterated forcefully. See my blog:


But before Nye gets to discussing the issue of power shifts, he debates whether the US is facing absolute decline, as did Rome, due to unresolved internal problems that eat away at the body politic: if America does decline, he indicates, it will not be from Kennedy’s “imperial overstretch”. He lists domestic issues under three headings:

  • Society and culture: Though many people see things as getting worse, he writes, this is not what the statistics say. Crime is down, as is teenage pregnancy, and divorce rates. Immigration remains a highly sensitive issue: but he points out that in 1910, 14.7% of the population was not born in the US; a century later, that figure stood at 13%. Hispanics have replaced Afro-Americans as the largest ethnic minority. By 2050, the US population will grow 42% to reach 439 million, thereby ensuring the US position as the third most populous country. Citing The Economist, he points out that immigration is good for America: 40% of the Fortune 500 are founded by immigrants, or their children(The Economist, “The jobs machine”, April 13, 2013.
  • The economy: The 2008 crash momentarily dented the US reputation for economic competence. But as Nye points out, the dollar remained a safe haven for flight capital from around the world during the crisis—a situation the uniqueness of which can be illustrated by the suggestion that in 1994 Mexico’s dual deficits did not lead to a crash in the peso/$ rate, but in a surge into pesos. Why should the $ have been targeted as a safe haven, after a financial crash in the global system’s heartland of America? Nye provides some reasons: the US, he writes in 2015, ranks No 3 in the WEF world competitiveness report; the US leads on IT, biotech and nanotech. With the shale oil revolution, -the reserves of which in oil and gas are estimated as lasting for an estimated two centuries-the US is becoming a net energy exporter. The US accounts for 31% of global R&D. The Shanghai Jiao Tong university rating, gives the US 17 out of the top 20 universities in the world. But, warns Nye, many US primary and secondary schools leg badly in international comparisons (; the Gini index has risen consistently over the past two decades, indicating a rise in inequality; and the richest 10% of the population take a larger percentage of the pie than in 1913. As Nye suggests, these indicators point to a widening élite/masses gap.
  • Political institutions: Nye points to the well recorded decline in trust in US institutions, the White House, the Supreme Court and the Congress. But citing the IBRD’s Governance Indicators, he points out that the US is allocated a high score on corruption; there is a swift decline in crime, emissions, abortion, alcohol and tobacco consumption, all the while that the US is leading the world into an internet revolution (citing David Frum, “Crashing the party”, Foreign Affairs, September/October 2014).

No, writes Nye: the US is not going the way of Rome: low productivity; internecine warfare, rampant corruption, and decay in political institutions. For the foreseeable future, the US will retain its primacy among the nations.

There are, Nye concludes, two great power shifts: the undeniable power transition from West to East among states; and the power diffusion from governments to non-state actors as a result of the global information revolution. The key features of this process of diffusion is that connectivity brings vulnerability; and the internet opens the way to demagogues.

Nye proposes analyzing international affairs on three linked chessboards:

  • The military, where the US remains No 1.
  • The economy, where the four major players are the US, Europe, Japan and China.
  • Transnational relations where the key players are multinationals corporations, banks, crime syndicates, terrorists etc.

“The real problem for the United States is not that it will be overtaken by China or another contender, but that it will be faced with a rise in the power resources of many others, both states and non-state actors”. “The American century is not over, if by that we mean the extraordinary period of American pre-eminence in military, economic and soft power resources that have made the US central to the workings of the global balance of power, and to the provision of public goods”.

In short, we have to distinguish between the noise of domestic political battles, where much of the talk is about President Obama’s alleged contribution to America’s decline, and geopolitical realities, which point to a very different conclusion.


Political Tribes and the Fate of Nations.

Amy Chua, Yale Law School professor, came to widespread attention with her book, World on Fire: How Exporting Free Market Democracy Breeds Ethnic hatred and Global Insecurity. By exporting “market democracy” around the world, the United States is helping to whip up ethnic hatred and contribute to global instability, rather than moving the world along the way to a civilization of civilisations. Market dominant minorities tend in many societies to exercise disproportionate influence, thereby stimulating resentment in the less affluent majority. This is particularly the case where the ethnicity of minorities and majorities do not coincide. “The bottom line is this, she writes. Democracy can be inimical to the interests of market-dominant minorities”.

Tribal instinct, she writes in Political Tribes, is an instinct to belong, and to exclude. Humans aren’t just a little tribal. They are very tribal, their demarcations lines being shared blood, shared history, a common culture and language all typically passed down from parent to child. She suggests two broad categories: primordialists argue in terms of biology, and instrumentalists seek to construct groups.

The United States, she argues, is a super-group, that sees the world and itself through its own ideological prism. US foreign policy for over a century, she asserts, has been blind to the power of tribal politics, blinded by the ideological prisms-Capitalism versus Communism; Democracy versus Auhoritarianism- through which the US views the world. Again and again, US foreign policy, she writes, takes an instrumentalist approach to nation-building through support for abstractions such as democracy, human rights or free markets. All the while, US policy remains blind to the tribalisms of local  politics:

  • In Vietnam, the Chinese population of 200,000 controlled most of industry, and dominated the retail, financial and transport sectors, and all sectors of the rice economy, plus 50% of all large hotels, 90% of smaller hotels in the Saigon area and 92% of restaurants. Essentially, she points out, the US was asking the South Vietnamese to fight and die to keep the local Chinese rich. Chinese minorities were equally dominant in the Philippines, Indonesia and Malaysia.
  • In Afghanistan, there are four major tribes: the Pashtuns, Tajiks, Uzbeks, Hazaras, with a long history of animosity between them. The Taliban is a religious, but also an ethnic, Pashtun movement. Pashtuns live across the frontier in Pakistan. Pakistan’s objective was to have Afghanistan dominated by radical Islam. The mujaheddin, she points out, were scarcely identifiable as “freedom fighters”.
  • In Iraq, elections aggravated sectarianism after the deposition of Saddam Hussein. Sectarian deaths fell off rapidly, once the US army learnt to negotiate with tribal chiefs. The US then backed the Shi’ite leader, Nouri al Maliki, to the premiership, but when under Obama, the US withdrew from Iraq, he cracked down on the Sunni population, contributing thereby to the rise of ISIS.
  • On Libya, Obama stated in 2011: “One thing is clear: the future of Libya is now in the hands of the Libyan people”. The problem was, and is, that the Libyan people hail from 140 different tribes. As Obama is quoted as saying in April 2016: “The degree of tribal division in Libya was greater than our analysis had expected”. Obama later pointed out that failure to plan for the day after was the worst mistake of his presidency.
  • In Venezuela, Hugo Chavez, a coloured “pardo” came to power in 1998, and was re-elected three times, until dying in office in 2013. Popular among Venezuela’s pigmented population, Chavez tapped into class and ethnic resentments, nationalised the oil industry, abolished Congress and the Supreme Court, and presided over spiralling inflation, hunger, and spreading poverty. The Venezuela he left behind, writes Chua, is in the hands of Cuba, and strongmen, while drug traffickers wield the real power over the country’s crumbling state.

The source of this foreign policy blindness, Chua argues, is the assumption that other nations can handle diversity in the US way. Here are three Presidents she summons to support her case whereby the US is defined as a nation beyond the group identity of particular origins.

  • Woodrow Wilson in 1915 addressing newly naturalized citizens: “You cannot become American if you think of yourselves as groups of Americans. America does not consist of groups” (though, as Chua points out, at the time it most decidedly did)
  • Reagan in his “Brotherhood of Man Speech” in 1990: “If we take this crowd and if we could go through and ask the heritage, the background of every family represented here, we would probably come up with the names of every country on Earth, every corner of the world, and every race. Here is the one spot on Earth where we have the brotherhood of man”.
  • Obama in his Grand Hall of Cairo University speech, 2009: “I have an unyielding belief that all peoples yearn for certain things: the ability to speak your mind and have a say in how you are governed; confidence in the rule of law and the equal administration of justice; government that is transparent and doesn’t steal from the people, the freedom to live as you choose. These are not just American ideas, they are human rights, and that is why we will support them everywhere”.

Here is Luce’s “American Century” thesis re-phrased across the years by successive Presidents, giving expression to the fundamental assumption that freedom speaks to peoples’ deepest yearnings. But as she goes on, the great Enlightenment principles of modernity-liberalism, secularism, rationality, equality, free markets-do not provide the kind of tribal identity that human beings crave. Furthermore, the Enlightenment ideal of universal brotherhood is incompatible with gross inequality.

“At its core, the problem is simple but fundamental, she writes. While black Americans, Asian Americans, Hispanic Americans, Jewish Americans, and many others are allowed-indeed encouraged-to feel solidarity and take pride in their racial or ethnic identity, white Americans have for the last decades been told they must never, ever do so. People want to see their own tribe as exceptional, as something to be deeply proud of; that’s what the tribal instinct is all about. For decades now, nonwhites in the United States have been encouraged to indulge their tribal instincts in just this way; but, at least publicly, American whites have not. On the contrary, if anything, they have been told that their white identity is something no one should take pride in”.

How did we get to a situation in the US where the “suppressed urge on the part of many white Americans-to feel solidarity and pride in their group identity, as others are allowed to-has created an especially fraught set of tribal dynamics in the United States today”?

Two crucial steps on the way to creating the “melting pot” of America were:

  • the enactment of the 14th Amendment to the constitution after the civil war that established that anyone born in America becomes an American citizen—citizenship is not by ancestry, but by location of birth;
  • the other was the abolition of slavery, to be followed across the southern states by Jim Crow legislation, introducing “separate but equal” divisions between blacks and whites.

These barriers began to break down during the wars, through the attraction of the black music of Paul Robeson or Louis Armstrong, and by executive decree, such as President Truman’s Executive Order 9981, in the face of widespread hostility, to integrate the US armed forces. Then in 1954, the Supreme Court struck down the “separate but equal” doctrine-known in South Africa as apartheid-followed a decade later by passage through Congress of the Civil Rights Act, that prohibited discrimination based on race in employment or public places. The following year, Congress passed the Immigration and Nationality Act, abolishing the nationality-origin quotas that had been introduced in the 1920s.  During these years, Ivy League colleges opened their doors to Jews, and Afro-Americans. A Catholic, John Fitzgerald Kennedy, was elected President of the United States.

From 1776 to 1920, Europe had been the main source of immigration. The quota system from the 1920s onwards ensured a steady flow of immigration, mainly from Europe, at the rate of 70,000 a year. After 1965, immigration rates exploded to 400,000 a year in the early 1970s, to 600,000 in the early 1980s, and to one million in 1989. Over the next decade, the US admitted 9 million immigrants, principally from Mexico, but also from China, the Philippines, India and Cuba. Overall, just under 60 million immigrants have entered the US since the 1965 Act. The Asian population grew from 1.3 million to 18 million, and the Hispanics from 8 to 57 million.  Today, writes Chua, the US includes 47 million people born abroad, harking from 140 countries. By the mid-21st century, the prospect is that whites will be in a minority.

At the time of the 1965 Act, Martin Luther King led a Civil Rights movement that preached colour blindness. The message was diluted over time by “affirmative action” policies intended to promote minority rights. By the time of the fall of the Soviet Union, the politics, of redistribution-from richer to poorer- gave way to the politics of recognition between groups, vicariously defined along racial or sexual lines-both it may be noted, biologically rooted. What mattered in post-cold war America was your identity, the colour of your skin, your sexuality, not your common citizenship. The result has not been difficult to isolate: two-thirds of the patriotic white working class feel discriminated against, and 29% of blacks agree. The white working class enjoy the least upward mobility; they are hugely under-represented in Congress and at élite universities; single parent households, a reliable proxy to poor performance in secondary school has risen to 40% of white households, and 70% of black households. When the white working class tune in to popular culture, they are assailed by anti-Christian and pro-lesbian and gay stuff. At the 2016 elections, 53% of white women voted for Trump.

A chasm has opened up between a globalist élite, favouring open borders, free trade, mass immigration, and “multi-cultural” but identity based politics, and America’s have-nots who remain deeply patriotic, nationalists and American Firsters. I remember travelling up from the Atlanta Olympic Games, where our son Alex represented Great Britain, and stopping at a wayside cafeteria. The television was on, reporting on the Games. I asked about the medal tally.”No idea, came the answer from my white working class interlocutor. I could’nt care less. The only thing that interests me is America’s medal tally”.

The mixture of mass immigration, the spread of identity politics, and the ongoing demographic trend has created a fraught set of tribal dynamics in the US.  Identitarian groups are thick on the ground: from the “sovereign citizens groups”, who believe that US federal élites have accepted that Queen Elizabeth gets access to tax revenues; to narco-saints, and their followers, such as Our Lady of the Holy Death, or the Mexican Malverde; to members of the prosperity gospel who encourage themselves to get rich because being rich is divine, and the 75 million followers of the Nascat nation, -the addicts of cart racing. Trump has personally participated in the World Wrestling Entertainment (WWE) -America’s most popular entertainment- and in 2013 was inducted to its Hall of Fame as a “superstar”-a hero in the mold of Hulk Hogan and Stone Cold Steven Austin.

America, argues Chua, has two white tribes: the posh and the poor. The poor are Hillary Clinton ‘s “deplorables”, who inhabit the rural, and rustbelt heartland, while the posh dwell on the coasts as citizens of the world . Trump she concludes was propelled to the White House by tribalism, by his ability to  play to the concerns of the “deplorables”, and by his sheer effrontery. And he tapped into the concerns of America’s prevailing majority-the white working class, who are waking to the fact that they too have an identity.

Welcome to a nascent White Nationalist movement, headed by Richard Spencer, who claims to be the founder of the “alt-right” movement. What he proposes is  an immediate stop to immigration; a return to “separate but equal” communities in the US; strong disapproval of inter-racial marriage and he proposes a more open-minded approach to Adolf Hitler. Here he is:

Another phenomenon is Tomi Lahren, more moderate than Spencer, but speaking to the rise of white working class identitarians in the US. Chua quotes her: “There are patriots of every race that have fought and died for this country”.”The bloodiest war in US history was over what was right, and it was largely white people fighting it”. Here she is:

The bottom line: identitarian politics begets identitarian politics within the US nation. Which way the US will go will depend on the dynamics unleashed. At the moment, five per cent of registered voters in one poll agree with Spencer. If the left insists on the politics of group identity, Spencer has a bright future.,%202017.pdf


One conclusion from Chua’s stimulating book runs that what is good for American foreign policy is not good to heal America’s domestic wounds: more sensitivity to tribal politics may enlighten foreign policy decisions, but is likely to deepen divisions at home. Conversely, more colour blindness for policy at home may have the same effect in reducing sensitivity to tribal instincts abroad.

Easternisation: War and Peace in the Asian Century.

Gideon Rachman is chief foreign affairs commentator of the Financial Times. The thesis of his book is that we are witnessing an epochal shift in power from West to East: “..the West’s centuries-long domination for world affairs is now coming to a close”.  The manifestation of this is the growing concentration of wealth in Asia, accompanied also by the rise of diplomatic and military tensions within Asia as a rising China challenges US and Japanese power, and the US pushes back by strengthening its alliances there. But the fundamental reason is demography: by 2025, 60% of the world’s population will live in Asia,; the US will account for 5% and Europe for 7%.

We are watching the end of the Vasco da Gama period, writes Nye. The phrase is taken from John Darwin’s, After Tamerlane: The Rise and Fall of Global Empires, 1400-2000. As Rachman writes, “for more than 500 years, ever since the dawn of the European colonial age, the fates of countries and peoples in Asia, Africa and the Americas were shaped by developments and decisions made in Europe-and later the US”. “The West’s centuries long domination is now coming to a close…Western political power was founded on technological, military and economic dominance-but these advantages are fast receding”.

The story starts with Admiral Zheng’s sailing in 1405 with 300 vessels and 27,000 sailors from Nanjing to Sri Lanka. But around 1435, Chinese rulers banned oceanic exploration, leaving ocean exploration to the “warring kingdoms” of Europe. Columbus sailed with 90 men in three small ships, with the blessing of Ferdinand and Isabelle of Castille, and Vasco da Gama in 1498 discovered the sea route to India. Main dates along the route to European dominance include: the defeat of the Nawab of Bengal, and his French allies, in the battle of Plassey in 1759; the East India Company’s export of opium to China, followed by the Opium War of 1839-42, the Chinese emperor’s concessions to open five ports to European trade, Commodore Perry’s mission to open Japanese ports in 1852, the sacking in 1860 of the Chinese Emperor’s Summer Palace, prompting the domestic reforms under the Meiji Emperor in Japan to avoid similar humiliations. By 1905, Japan’s rapid industrialization provided it with the wherewithal to defeat Russia, a European power, at the battle of Mukden, and to sink the Russian Emperor’s fleet at the battle of the Tushima Straits. The news flashed around the world that a non-western power had inflicted humiliation on one of Europes’ powers. Thirty-seven years later,  Singapore’s surrender in 1942 to a smaller Japanese force shattered the myth of western invulnerability irredeemably.

In 1914, Europe ruled 82% of the world’s population. But the war dealt deadly blows-human, cultural, material and psychological- to Europe’s self-confidence. It took the second world war to deliver the final blow to European rule in Asia.  Rachman quotes Darwin: “The end of British rule in India in 1947 and the withdrawal two years later of Europe’s navies from China marked the end of the “Vasco da Gama”  epoch in Asian history.”

The fact that decolonization in Asia had laid the basis for a shift of global political power was disguised for decades, writes Rachman, by two crucial developments. First, the United States succeeded the European powers as the dominant power in the Asia-Pacific and fought two wars in Korea and Vietnam to ensure its primacy. Second, Asia’s two giants-India and China-turned their economies inwards, and pursued economic policies, writes Rachman, that thwarted their development. Asia’s transformation took place offshore in Japan, South Korea and South East Asia. Only in the 1980s and 1990s did China and India adopt similar outward oriented economic policies. A symbolic moment was reached in 2014 when the IMF announced that China had dethroned the US as the world’s largest economy, a position that the US had occupied since 1870. By 2030, as sketched in  the US National Intelligence Council Report, Global Trends 2030-Alternative Worlds-Asia’s economy will have surpassed North America and Europe combined in terms of global power, based on gdp, population size, military spend and technological development.

Asia’s rise has been punctuated by a series of crises: the Tienanmen Square events of May-June which seemed to imperil the Chinese party-state’s grip on the country; the Asian financial crash of 1997, when western institutions dispensed harsh work out policies on Asian countries with imbalances, that they proved noticeably reluctant to impose later on themselves; the high tech financial crash of 2001, followed by the terror attacks on New York and Washington DC on 9/11; and the 2008 financial crash, after years of low western interest rates kept down by purposeful central bank policy, but also by the recycling of surplus funds generated by the growing Chinese and German trade surpluses of preceding years.

For Rachman, the rise of Asia is co-terminous with the winding down of the Pax Americana, as global tensions mount and the power gap between the US and China narrows. Accusations by his critics that America’s foreign policy travails are to be ascribed to the alleged weakness of President Obama are beside the point. It is the West, and not just America, that is on the retreat. The US’ resources may be augmented by its prime alliances, but Japan is burdened by crippling debt and an ageing and shrinking population, while Europe is wracked by its internal problems and fast receding as a significant force in world affairs.

“Easternisation”, writes Rachman, exposes the West’s “ability to function as a pole of stability and power, imposing order on a chaotic world”. The challenge to Western power is all over Asia, the Mid East, eastern Europe, Latin America and Africa. ”I believe that the Obama years will be seen as a hinge in history-in which the erosion of Western power became more evident”.

The US proved unable, he writes, to restore order in the Mid-East; Russia has become the main support of the Assad regime; the Taliban are on the return in Afghanistan; Russia’s annexation of the Crimea in 2014 is the first forcible annexation of territory in Europe since 1945; China challenges US and Japanese power over the islands in the East China Sea,  and its resources are focused on its own coastline, while America’s are spread across the world; China’s rise is expressed in both Obama’s “pivot” to Asia  and Putin’s “pivot” to Asia; it is expressed in China’s replacement of the West as the new face of globalization in Africa, and the surge in China’s trade with Latin America from $10 billion in 2000 to $250 billion in 2013. Putin and Turkey’s leader, Erdogan espouse their own brands of anti-liberal authoritarianism, as do the EU member states of Poland and Hungary.

There is an important ideological element in the process of “Easternisation”, Rachman argues. China virtue signals its difference with the former great powers as seeking “win-win” solutions beyond the ideological export of its values. Implicitly, that was the “European-type” policy of Mao-Tse Tung to promote China’s revolutionary experience around the world; now China is an ardent supporter of non-intervention in the affairs of independent states. Its spokesmen never miss a chance to tar European and American policies with an imperial brush. The message falls on willing ears, as Pankaj Mishra reminds his readers: “It is no exaggeration to say that millions, probably hundreds of millions of people that have grown up with a history of subjection to Europe and America-..derive profound gratification from the prospect of humiliating their former masters and overlords(quoted in From the Ruins of Empire).”

Rachman, rightly, questions Mishra’s assertion. One of the most brutal imperial regimes in Asia, Rachman reminds us, was Japan, whose present-day nationalists continue to justify Japan’s wars of 1942-1945 as fought in the name of purging Asia of alien powers. Pro-democracy demonstrators in Hong Kong struggle to preserve some of the legacies from British rule; Singapore has taken over many of the traditions, laws and legacies-including a highly professional civil service-from the British; and as Prime Minister Modi stated in his speech to the British parliament,  “I stand here today, not as a visiting Head of Government, given the honour to speak in this temple of democracy. I am here as a representative of a fellow institution and a shared tradition.”

There is an extensive literature comparing the rise of China to the rise of Wilhelminian Germany, and the inevitable clash which that analogy suggests between the rising power and the status quo power, in this case the US. “China cannot rise peacefully”, writes John Mearsheimer, a leading American realist, in his The Tragedy of Great Power Politics. As Eyre Crowe wrote in his famous 1907 memorandum, “Germany was seeking a general political hegemony and maritime ascendancy, threatening the independence of her neighbours and ultimately the existence of England ”(cited by Rachmain from Henry Kissinger’s book, On Diplomacy).

In his chapter entitled “the end to hide and bide”, Rachman presents the transformation in Chinese foreign policy from the days of Deng Deng Xiaoping’s famous “24 character” guideline for China’s foreign policy from the early 1990s: “keep a low profile and achieve something” (taoguang yanghui, yousuo zuowei). The reformulated version states that China should “uphold (jianchi) keeping a low profile and actively (jiji) achieve something.” The policy was presented more abrasively by Chinese Foreign Minister Jong Jiecki  at the summit of Asia-Pacific nations held in Vietnam in 2010: “China is a big country. And you are all small countries. That is a fact”.

China’s neighbours did not wait for Jong Jiecki to act on this advice: as mentioned, both Japan and India have re-affirmed or strengthened their relations with the United States, while for all of Putin’s assertion of a closer embrace between Russia and China, Russia’s fears of being dominated by its neighbour remains strong. As Andrei Piontkovsky, a Russian political analyst has opined, an alliance between Russia and China ressembles one between “a rabbit and a boa constrictor”(not cited by Rachman).

There are three reasons listed by Rachman why China may have become more assertive:

  • Following the crackdown on the students in Tienanmen Square, the party-state reached for nationalism in order to shore up its legitimacy. From1992 onwards, high schools have had to teach a course on modern Chinese history. The teaching guidelines state clearly that “Chinese modern history is a history of humiliation in which China gradually degenerated into a semi-colonial and semi-feudal society…It is also the history of the New Democratic Revolution under the leadership of the Chinese Communist Party”. In short, for the past quarter of a century, school children have been reared on the narrative of humiliation-and on suspicion of western motives.
  • China’s growth has made its leaders aware of the country’s economic strength. Foreign leaders from the rest of the world flock to Beijing. The UK Prime Minister backs away from his expression of sympathy for the Dalai Lama. Against the expressed wishes of the Obama administration, the UK signs on to join the Asian Infrastructure Investment Bank, and is followed in short order by Australia, Korea and Germany. China is a prime market for major western corporations, and is No 1 market for 43 countries in the world; US is the first market for 32.
  • The party-state is hyper-sensitive to signs of vulnerability at home. The leadership observes with concern the various “colour” revolutions that have rippled through Georgia, the Ukraine, Iran and Egypt. The suspicion is of western use of NGOs, of mobile phones and of internet to undermine political stability at home and abroad. A Great Firewall has been erected against Google and Twitter barring Chinese internauters from their use. Chairman XI, in place since 2012, has driven a ruthless “anti-corruption” drive against his domestic enemies at home, arresting one hundred thousand people for corruption in 2015 alone.

Party-state assertion of control at home and assertion of China’s place in the world are two sides of the same nationalist coin.  For China, globalization does not mean, as it does in the EU, obeisance to supranational authorities. Rather globalization for the regime means the opportunity to champion a Westphalian world of independent states, of the balance of power, of diplomacy, of international law and of great powers. 


The shadow of the future hangs over all three books: Nye considers that the US will still be top dog in the mid-twenty-first century; Chua argues that the dynamics of identitarian politics in the US is driven by demands from the white-working class majority of Americans to assert their own identity now, before they become a minority mid-century; Rachman argues that we are watching the winding down of the Pax Americana, the concomitant rise in serious conflicts around the world, and the longer term shift in power from West to East. The rise of Asia is the long delayed result of the ending of the “Vasco da Gama” period which lasted from the fifteenth century to 1949.

These three different futures evidently do not sit comfortably next to one another, especially if you merge the theses of Nye and Chua. Will the US still enjoy global primacy in 2041? Yes, answers Nye. But Chua chimes in that the US may not be at all like the US now. The US now in her story is the result of the country’s history, but it is also the result of sixty years of mass immigration which has transformed the country. The identity politics of the left, designed to answer the identity politics of a “separate but equal” America, has generated an identity politics backlash, in the form of the white working class, and of Trump’s election. The diplomacy of this America is informed by the US President not talking very softly while wielding a very big stick. A two hundred ship armada turns up off the coast of North Korea to encourage Kim Jon Un to smell the coffee; the Mexican president is told to finance the wall along the Mexican-US frontier; China and the EU are told beware of trade wars, and soon after tariffs are slapped on steel and aluminum.

It is easy to see why the analogy of German-British rivalry from the early twentieth century could fit a credible scenario for the mid-twenty-first century. In this scenario, American nationalism answers Chinese nationalism. There is not a European nationalism, so Trump fingers Germany. After all, Berlin rules Europe, or at least has made a stab at it.

Nevertheless, Nye puts his finger on the one future which seems to be equally credible. There are two power shifts, he writes: from West to East, and from governments to non-state actors. It is the linkage and overlay of these two, and the related interdependence among the peoples of the world,  which I suggest, is the essence of the global system. That system is Western in design. The secrets of the five centuries of western power are now out, the scientific method has spread around the world, as has industrialization, the creation of a modern state system, with its armies, its frontier conflicts, its many currencies, and its diplomatic networks, now overlaid by the web of corporate linkages straddling the globe, and seeking to benefit by the international division of labour offered in the context of a global economy. What is novel is the discrepancy between the speed of growth in Asia, the hundreds of millions there who have, are, or may well be emerging from extreme poverty, and the much slower growth in the rich countries of the West, all of which have experienced yawning gaps between their élites which support the existing global system, and the many who are indifferent.  To the extent that the West is still very much in the driving seat as a source of investment, technology, trade and a cornucopia of inventions, the foundations on which it is based-public acquiescence as a minimum, enthusiastic support at the best-is weak. That is the heart of Chua’s case.

One final point. Rachman’s thesis on the world’s “easternization” is presented with elegance, wit, much knowledge and extensive thought. But I suggest that he exaggerates. He is quite right of course to point out that the rise of Asia is also accompanied by the rise of tensions between Asian countries. But the paradox of the thesis of American decline(a thesis I remain very skeptical about) is that China’s rise, informed since 2008 at the latest, by more bragadaccio than during Deng’s days, contributes to strengthening America’s alliances around the periphery of China. The one exception is Putin’s Russia, which seeks alliance with China, while declaring a doctrine of first use of nuclear weapons, a Russia that without nukes is dwarfed by the giant on its doorstep-Russia’s rabbit to China’s boa constrictor.

Rachman exaggerates, too, in my view, in placing too much weight on his “easternization” argument. It is true that China’s emergence has transformed the prospects of Latin America and Africa; that its ambitions impact every aspect of Asian developments; that China is closely linked to the expansion of rust-belt America, and has contributed to the evisceration of Italian light industry over the past twenty years. But just as the cold war overlay was allowed to obscure local conflicts and deficiencies around the world, so it is possible to draw the links between China’s emergence and world developments too closely. Take for example Europe: its problems are entirely home grown. Mass unemployment in southern Europe is directly to be ascribed to the initiative of the single currency, and its incompleteness-an incompleteness that in turn is entirely European in origin. Similarly, rustbelt America is in large part to be ascribed to the relative weakness of local policy instruments to promote local economic development in the US, and to the the empire that abstract ideas of “free trade” or “shareholder value” have enjoyed for decades in US policy, corporate, state and federal, and in academe.

Not least, the conflicts within Asia, and notably within China, are not new at all. Rivalry along the Himalayas from Myanmar to the Indo-Pakistan frontier have been around for more than fifty years; Japan’s difficult relations with China date back to the nineteenth century, as do Russia’s. Already during the Korean war, China revealed itself as a formidable competitor militarily to the UN forces led by the US; America received a very bloody nose in the war with Vietnam; the Russian defeat of 1905 at the hands of Japan sparked the first revolution there; the ignominious surrender of Singapore in 1942 irredeemably shattered the myth of western supremacy.

One way of reinterpreting the events dealt with in these books is to argue that we are watching a form of Hegelian process, where the globe has “westernized”, and in doing so, the East has globalized. That makes for a very different world indeed.

A concluding remark: this new world is on the way to re-writing its history. Be prepared for major cultural wars. China’s tarring of Europeans and Americans with the imperial brush is but one example.

I will return to these theme in later contributions.










About Jonathan Story, Professor Emeritus, INSEAD

Jonathan Story is Emeritus Professor of International Political Economy at INSEAD. Prior to joining INSEAD in 1974, he worked in Brussels and Washington, where he obtained his PhD from Johns Hopkins School of Advanced International Studies. He has held the Marusi Chair of Global Business at Rensselaer Polytechnic Institute, and is currently Distinguished Visiting Professor at the Graduate Schoold of Business, Fordham University, New York. He is preparing a monograph on China’s impact on the world political economy, and another on a proposal for a contextual approach to business studies. He has a chapter forthcoming on the Euro crisis. His latest book is China UnCovered: What you need to know to do business in China, (FT/ Pearson’s, 2010) ( His previous books include “China: The Race to Market” (FT/Pearsons, 2003), The Frontiers of Fortune, (Pitman’s, 1999); and The Political Economy of Financial Integration in Europe : The Battle of the Systems,(MIT Press, 1998) on monetary union and financial markets in the EU, and co-authored with Ingo Walter of NYU. His books have been translated into French, Italian, German, Spanish, Chinese, Korean and Arabic. He is also a co-author in the Oxford Handbook on Business and Government(2010), and has contributed numerous chapters in books and articles in professional journals. He is a regular contributor to newspapers, and has been four times winner of the European Case Clearing House “Best Case of the Year” award. His latest cases detail hotel investments in Egypt and Argentina, as well as a women’s garment manufacturer in Sri Lanka and a Chinese auto parts producer. He teaches courses on international business and the global political economy. At the INSEAD campus, in Fontainebleau and Singapore, he has taught European and world politics, markets, and business in the MBA, and PhD programs. He has taught on INSEAD’s flagship Advanced Management Programme for the last three decades, as well as on other Executive Development and Company Specific courses. Jonathan Story works with governments, international organisations and multinational corporations. He is married with four children, and, now, thirteen grandchildren. Besides English, he is fluent in French, German, Spanish, Italian, reads Portuguese and is learning Russian. He has a bass voice, and gives concerts, including Afro-American spirituals, Russian folk, classical opera and oratorio.
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