The Rise and Fall of the Great Powers (88 page)

While what follows is speculation rather than history, therefore, it is based upon the plausible assumption that these broad trends of the
past five centuries are likely to continue. The international system, whether it is dominated for a time by six Great Powers or only two, remains anarchical—that is, there is no greater authority than the sovereign, egoistical nation-state.
⁵
In each particular period of time some of those states are growing or shrinking in their
relative
share of secular power. The world is no more likely to remain frozen in 1987 or 2000 than it was in 1870 or 1660. On the contrary, certain economists would argue that the very
structures
of international production and trade are changing faster than ever before: with agricultural and raw-materials products losing their relative value, with industrial “production” becoming uncoupled from industrial “employment,” with knowledge-intensive goods becoming dominant in all advanced societies, and with world capital flows becoming increasingly detached from trade patterns.
⁶
All this, and the many new developments in science, are bound to influence international affairs. In sum, without the intervention of an act of God, or a disastrous nuclear conflagration, there will continue to be a dynamic of world power, essentially driven by technological and economic change. If the rosy forecasts of the impact of computers, robotics, biotechnology, and so on are correct—and if, in addition, forecasts of the success of a “green revolution” in parts of the Third World (with India and even China becoming regular net exporters of grain)
⁷
do turn out right—then the world
as a whole
could be a lot richer by the early twenty-first century. Even if technological progress is less dramatic, economic growth is likely to occur. Changing demographic patterns, with their impact upon demand, would ensure that, as would the more sophisticated exploitation of raw materials.

What is also clear is that this growth will be uneven—faster here, slower there, depending upon the conditions for change. It is this, more than anything else, which makes the prognoses that follow so provisional; for there is no guarantee that, for example, Japan’s impressive economic expansion over the past four decades will continue during the next two; nor is it impossible for Russian growth rates, which have been declining since the 1960s, to increase again in the 1990s, given changes in that country’s economic policy and mechanisms. On the evidence of existing trends, however, neither of those outcomes appears very likely. To put it another way, if it did happen that Japan stagnated and Russia boomed economically between now and the early twenty-first century, then that could only come about from changes in circumstances and policies far more drastic than it is reasonable to assume from the available evidence. Just because estimates of how the world will appear in fifteen or twenty-five years’ time may go wrong does not mean that one should prefer implausible outcomes rather than sensible expectations based upon current broad developments.

It is reasonable to expect, for example, that one of the better-known “global trends” of today, the rise of the Pacific region, is likely to continue, simply because that development is so broad-based. It includes not only the economic powerhouse of Japan, but also that swiftly changing giant the People’s Republic of China; not only the prosperous and established industrial states of Australia and New Zealand, but also the immensely successful Asian newly industrializing countries like Taiwan, South Korea, Hong Kong, and Singapore—as well as the larger Association of Southeast Asian Nations (ASEAN) lands of Malaysia, Indonesia, Thailand, and the Philippines; by extension, it also includes the Pacific states of the United States and provinces of Canada.
⁸
Economic growth in this vast area has been stimulated by a happy combination of factors: a spectacular rise in industrial productivity by export-oriented societies, in turn leading to great increases in foreign trade, shipping, and financial services; a marked move into the newer technologies as well as into cheaper, labor-intensive manufactures; and an immensely successful effort to increase agricultural output (especially grains and livestock) faster than total population growth. Each success has beneficially interacted with the others, to produce a rate of economic expansion which has far eclipsed that of the traditional western powers—as well as that of Comecon—in recent years.

In 1960, for example, the combined gross domestic product of the Asian-Pacific countries (i.e., excluding the United States) was a mere 7.8 percent of world GDP; by 1982, it had more than doubled, to 16.4 percent, and since then the area’s growth rates have exceeded those of Europe, the United States, and the USSR by ever wider margins. It is very likely to contain over 20 percent of world GDP by the year 2000— the equal of Europe, or the United States; and that achievement will occur even on the basis of growth-rate differentials “much smaller” than those which have existed over the past quarter-century.
⁹
The dynamism of the Pacific basin has also been felt in the shifting economic balances within the United States itself during that same period. American trade with Asia and the Pacific was only 48 percent of that with Europe (OECD members) in 1960, but had risen to 122 percent of American-European trade by 1983—a change which has been accompanied by a redistribution of both population and income within the United States in the direction of the Pacific.
¹⁰
Despite a slowdown in, say, any
one
country’s growth, or problems affecting a particular industry, it is evident that these trends are continuing as a whole. It is not surprising, therefore, that one economic expert has confidently predicted that the entire Pacific region, which now possesses 43 percent of the world’s GNP, will enjoy a good 50 percent of it by the year 2000; and concludes, “The center of world economic gravity is shifting rapidly towards Asia and the Pacific, as the Pacific takes its place as one
of the key centers of world economic power.”
¹¹
This sort of language has of course been heard frequently since the nineteenth century; but only with the massive growth of the region’s commerce and productivity since 1960 has that forecast become a reality.

Similarly, it is also reasonable to assume that the next few decades will witness a continuation of a much less attractive but even broader trend: the spiraling cost of the arms race, which is fueled by the sheer expensiveness of newer weapon systems as well as by international rivalries. “One of the few constancies in history,” it has been observed, “is that the scale of commitment on military spending has always risen.”
¹²
And if that was true (granted some short-term fluctuations) for the wars and arms races of the eighteenth century, when weapons technology changed only slowly, it is much truer of the present century, when each new generation of aircraft, warships, and tanks is vastly more expensive than preceding ones, even when allowance is made for inflation. Edwardian statesmen, appalled that a pre-1914 battleship cost £2.5 million, would be staggered to learn that it now costs the British Admiralty £120 million and more for a replacement
frigate!
American legislators, who had willingly allocated funds for thousands of B-17 bombers in the late 1930s, now understandably wince at the Pentagon’s estimate that the new B-l bomber will cost over $200 billion for a mere one hundred planes. In all areas, the upward spiral is at work:

Compounding these problems is the evidence that today’s armaments industry is becoming increasingly divergent from commercial, free-market manufacturing. The former, usually concentrated in a few gigantic firms enjoying a special relationship with their own department of defense (whether in the United States, Britain, or France, or even more in the “command economy” of the USSR), is frequently protected from marketplace operations by the state’s granting of exclusive contracts and cost-overrun guarantees, for products for which only it (and friendly states) will be the consumer. The latter, even in the case of giant companies like IBM and General Motors, has to struggle against cutthroat competition to win merely a
share
of the volatile internal and external markets in which quality, consumer taste, and price are vital variables. The former, driven by military men’s desire to have the most advanced “state-of-the-art” weaponry so
that their armed services may be able to fight in all possible (if sometimes highly implausible) battle scenarios, produces goods which are increasingly more expensive, more elaborate, and
much less numerous
. The latter, after initial heavy investment in the early prototypes of household goods or office computers, has its average unit costs pushed
downward
, because of market competition and large-scale production.
¹⁴
And while it may be true that the explosion in new technological and scientific developments since the late nineteenth century inevitably drove defense manufacturers into a relationship with governments which deviated from “free market” norms,
¹⁵
the present pace of this increase is an alarming one. The various proposals about “military reform” in the United States could perhaps prevent the result forecast by the cynics, that the entire Pentagon budget may be swallowed up on
one
aircraft by the year 2020; but even those efforts are unlikely to
reverse
the trend toward ever fewer weapons at ever higher cost.

While much of this is of course due to the growing and inescapable sophistication of weapons—like modern fighter aircraft, which may contain 100,000 separate parts—it is also caused by the continuing array of arms races on land, on and under the oceans, in the air, and in space. If the greatest of those rivalries is between NATO and the Warsaw Pact countries (which, thanks to the two superpowers, spend almost 80 percent of the world’s investment in armaments, and possess 60–70 percent of its aircraft and ships), there are smaller yet still significant arms races—not to mention wars—in the Middle East, Africa, Latin America, and across Asia, from Iran to Korea. The consequence has been an explosion in Third World military expenditures, even by the poorest regimes, and large-scale increases in arms sales and transfers to those countries; by 1984, world arms imports of a colossal $35 billion had exceeded the world trade in grain ($33 billion). In the following year, it is also worth noting, world military expenditures had reached a total of about $940 billion, rather more than the entire income of the poorer half of this planet’s population. What was more, that expenditure on weapons was rising faster than the global economy and most national economies were expanding. At the head were the United States and the USSR, each devoting well over $250 billion annually to defense and likely to push that total to over $300 billion in the near future. In most countries, spending on the armed forces was taking an increasing share of governmental budgets and of GNP, checked only (with very few exceptions of motive, as in Japan and Luxembourg) by economic weaknesses, shortage of hard currency, etc., rather than by a genuine commitment to reduce arms expenditures.
¹⁶
The “militarization of the world economy,” as the Worldwatch Institute terms it, is now advancing faster than it has for a generation.
¹⁷

These two trends—the uneven pattern of growth, with the global productive balances tilting toward the Pacific basin; and the spiraling costs of weapons and armed forces—are of course separate developments. Yet at the same time it is obvious that they are increasingly likely to interact and indeed are doing so already. Both of them are driven by the dynamic of technological and industrial change (even if individual arms races will have political and ideological motives as well). Both of them impinge heavily upon the national economy: the first by boosting wealth and productivity at a faster or slower pace, and by making certain societies more prosperous than others; the second by consuming national resources—measured not simply in terms of investment capital and raw materials, but also (and perhaps even more importantly) in the share of scientists, engineers, R&D personnel, engaged in defense-related production as opposed to commercial, export-oriented growth. Although it has been claimed that defense expenditures can have certain commercial economic spin-offs, it seems increasingly difficult to argue against the proposition that
excessive
arms spending will hurt economic growth.
¹⁸
The difficulties experienced by contemporary societies which are militarily top-heavy merely repeat those which, in their time, affected Philip II’s Spain, Nicholas II’s Russia, and Hitler’s Germany. A large military establishment may, like a great monument, look imposing to the impressionable observer; but if it is not resting upon a firm foundation (in this case, a productive national economy), it runs the risk of a future collapse.

By extension, therefore, both of these trends have profound socioeconomic and political implications. Slow growth occurring in a particular country is likely to depress public morale, produce discontents, and exacerbate the discussion over national spending priorities; on the other hand, a fast pace of technological and industrial expansion will also have its consequences, especially upon a hitherto nonindustrial-ized society. Large-scale armaments spending, for its part, can benefit specific industries within the national economy; but it can also lead to a diversion of resources from other groups in society, and it can make that national economy less capable of handling the commercial challenges of other countries. Unless there is an enemy immediately at the gate, high defense spending in this century has nearly always provoked a “guns versus butter” controversy. Less publicly, but of even greater significance for our purposes, it has provoked a debate upon the proper relationship of economic strength to military power.
¹⁹