Atlantic Community:Open Think Tank Article "Recess is Over: Europe and Systemic Crisis"

Recess is Over: Europe and Systemic Crisis

Asle Toje: It now seems clear that the economic crisis that started in 2008 is both deeper and more lasting than first thought. While leaders threat about the crisis bursting into the real economy, this specter is manageable compared with the dangers we will face if the economic crisis turns into a full-blown systemic crisis.

The journalist Robert D. Kaplan was among the first to realize that the financial crisis would have political consequences. A poorer US will not be able to maintain its technological edge, nor keep its defensive strength relative to emerging powers. Kaplan believes this will "not necessarily lead to a security dilemma for the US, but it will lead to a multipolar world, and the end of American dominance." Those who will feel it are those who have outsourced their security to the US, which includes most of its allies in Europe.

The world is facing a power vacuum that will likely last for decades. The gap arises because Europe and the U.S. is in a phase of relative decline, while China, India and Russia seeks great power status without being overly interested in the system maintenance chores that come with such a status.

This is significant because - as the historian EH Carr stipulates - three factors must be present to create a systemic crisis: the existence of powerful and resentful powers on the fringes of the international system, a deep and persistent crisis in the global economy and a lack of will, slash capacity at the leading power to guarantee the international order. Without such guarantees strong states will be able to force weaker states and get away with it.

While the new powers emerge political authority is transferred to new venues. The 1990s enthusiasm for institutionalized supranational regimes has been replaced by a shift towards informal forums, such as G-20. The UN is weakened by its inability to reflect shifting political realities. India and Brazil are still outside the Security Council. As the League of Nations before it, the UN is undermined by weak leadership and an inefficient and costly bureaucracy. The UN is running out of donors.

China leads the posse of emerging powers. But just as important as the question of who the new great powers are, is who they are not. It now seems clear that the European Union will not be one of the poles in a multipolar world order. The reasons for this are many. Perhaps most important is the lack of a decision procedure that makes it possible to make decisions when one or more of the 27 member states are not in agreement. Although the economic aspects of the EU will likely survive, the political integration may well be a casualty of the ongoing Euro-crisis.

What is startling is not that some institutions are struggling, but that all of them are struggling at the same time. The wasting disease that has afflicted the UN and the EU is also gnawing at the roots of the other institutional "grand oaks" that were planted into the ashes of World War II. Free trade is under pressure and the World Trade Organization "one size fits all model" is being replaced by a giant "spaghetti bowl" of bilateral accords. This shift is accompanied by a surge in protectionism, if not in theory then in practice.

A similar "bilateralisation" seems to be underway in the realm of security. For NATO, Afghanistan has sucked up political and military resources throughout the 2010's. When the NATO alliance pulls out in 2014, it will probably do so with little to show for its efforts. A divided alliance emerged over the Libyan intervention and it seems that NATO is transforming from a military defense alliance into a political-military consultation forum, a mere staging ground for coalitions of the willing.

European countries' minimal defense budgets force the burden onto the United States. Key voices in Washington now question whether it is in their country's interest to guarantee the security of countries that are inconsistent in their support of US geopolitical goals. Merely voicing such thoughts creates insecurity in Europe. Were the US to abstain, NATO has very little capacity to defend its members' territory in the case of war. It is therefore likely that the militarily weak European countries will seek to bolster bilateral ties with America.

The peril is, as EH Carr pointed out in his post-mortem of the inter-war years, that the established powers (in our case the US) is weakened in its resolve to act as policeman, janitor and social security in the international system - disappointed that the system has allowed rivals to emerge. The rivals on their side (we think of China) is not disposed to take on system-upholding tasks as they will claim (often rightly) that the international system is weighed to benefit the established powers.

The foreign policy recess is thus over. For Europe, this represents a major challenge. European leaders may be equal to the situation on a rhetorical level- but in practice, Europe's foreign resources are spent on yesterday's agenda - not on the areas that the changed incentives in the international system would suggest. This gives reason to question whether Europe's bloated foreign services, skilled in the recess activities of foreign policy, will be equal to the task now that geopolitics are back on the curriculum.

Asle Toje is the acting Research Director at the Nobel Institute in Oslo and author of "The European Union as a Small Power: After the Post-Cold War".

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January 31, 2012

John Sallinger

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Well said. I have been wondering what Europe would do when the incetives of the international system changes and the intellectual elite consists uniformly of utopians. Well - it seems that a new and more realist generation of scholars are in the offing.

January 31, 2012

Greg Randolph Lawson, Wikistrat, Platinum Contributor (507)

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Excellent piece. Europe is at a crossroads but so is every other major power. Certainly the U.S. and certainly China and certainly the Middle East. It is an era of power transition and diffusion. My concern has always been that we are entering an era of, as the President of the Council on Foreign Relations Richard Haas put it, non-polarity. At a time of proliferating weapons of mass destruction, something I have referred to here as the now upon us "Golden Era of Proliferation" we are entering dangerously destabilizing times.

I think NATO is ceasing to be as important and the military alliance between trans-Atlantic partners is showing signs of strain that happy talk and discussions of "smart power" can't really paper over.

The US and the EU need to start considering a future Atlantic free trade zone to compete with the shifting locus of power east. While the US will likely have to continue maintaining decisive military power (something not necessarily possibly given its own domestic travails), Europe and the US need to get closer to singing from the same hymn book. Trade may be the only thing we all know the notes to.

February 3, 2012

Joshua Clapp, Atlantic Community, Editor

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Excellent piece. I wonder how close, if at all, we are to Carr’s point of systemic crisis.
Nonetheless, the international system is obviously changing with the US in relative decline and others rising. Recess is indeed over. There are many possible responses.

For example, Greg you mentioned an Atlantic free trade area. Do you think that a transatlantic free trade zone is actually feasible at some point? I know the idea has been thrown around for some time. A little more recently Merkel talked about such an Atlantic free trade zone, but I am not sure what eventually happened to the idea.

Regards,

Joshua

February 20, 2012

Donn Baca, DePaul University, Bronze Contributor (25)

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I agree with a great deal of your piece, but it makes an important fundamental error - at least in the strategic assessment. China and Russia in particular face extremely grave internal difficulties both of which ensure that they cannot emerge as strategic rivals to U.S. power (short of a nuclear conflict). Population declines are likely to cripple both nations, and in the case of China in particular, there is now no longer a way to avoid the consequences of its ill-conceived "one child" policy. Russia for its part continues to shrink annually. China which on paper appears to be both an economic power and a potential military power, lacks the capability to effectively project power either way. The Chinese military lacks the ability to project power militarily even within its own immediate region and there is no credible sign of that changing (even with a new anti-ship missile or aircraft carriers). Economically, China has chained itself to the United States (and other developed economies) and is unable in the event of a conflict to avoid severely damaging itself. Full-blown economic sanctions by the U.S. against China would cripple China (and they can't foreclose on the U.S. or simply dump U.S. treasury securities). China's only political power vs. the U.S. stems from the desire to have them buy our debt securities...but that is a matter of convenience to our deficit-spending adicted government...not something which is required.

In terms of the rest of the emerging world, it becomes imperative that one recognize that any of the "emerging" will remain second class. This is something which cannot be escaped because of globalization. The resources of the world are dominated by the developed nations of the world which can squeeze out others competively in acquiring resources via price in the world markets. The United States enjoys an additional advantage over any other in that regard...it is the only nation in the world capable of projecting power globally and possessing the capacity of any other nation or bloc of nations to access strategic resources. The only thing the United States lacks to do so at any time is strong leadership!

Not to say that the United States should be always trying to impose its will in the world...but it is important that strong leaders be in place to remind the world that it can do so at will. The current Administration has begun to convey and reinforce to foes an image of the United States as weak and ineffectual - in reality it is merely the leadership which is.

The U.S. and Europe do face critical threats to stability and their position within the global order...but those aren't really related to new emerging powers. India is perhaps the nation with the greatest chance of moving up within the global order, but competition with China to obtain resources vital to the two economies will occupy both for a long time. The economic growth rates of both India and China are likely to slow dramatically within a decade (China's statistics are already grossly exagerated). With limited resources available, one or both will slow and a huge new set of problems will arise - a lack of sufficient economic growth. India's surging population will require it, and China's shrinking population will require economic growth to offset terrible demographic problems.

DB Baca

February 20, 2012

Donn Baca, DePaul University, Bronze Contributor (25)