http://www.cfr.org/publication/12719/

"The New nєω ωσrℓ∂ σr∂єr"
Speaker:    Daniel W. Drezner, Associate Professor of International Politics, Fletcher School of Law and Diplomacy
Presider:    Gideon Rose, Managing Editor, Foreign Affairs

February 26, 2007
Council on Foreign Relations

GIDEON ROSE:  Hi there.  Welcome, everybody.  I'm Gideon Rose, managing editor of Foreign Affairs, and we're delighted to have you with us today to have a discussion with Dan Drezner, the author of an important new piece in the new issue of Foreign Affairs called "The New nєω ωσrℓ∂ σr∂єr."

The -- if you were to think of a Venn Diagram between top political economists and prominent bloggers, there probably would be a very, very small population in that middle.  But the chief in that overlap would be Dan Drezner, who is associate professor of international politics at Fletcher -- Fletcher School of Law and Diplomacy at Tufts.  The author -- his latest book is called "All Politics is Global" coming out next month, I believe.

DANIEL W. DREZNER:  Yes.

ROSE:  And he has written a very interesting article for us on the new power alignments in the world and how the Bush administration is reacting to them.

So what we're going to do is, we're going -- I'm going to talk with Dan for a little bit about them, and then we'll turn it over to you.  And we'll run as long as the questions keep coming.

So Dan, why don't you start by giving a brief precise of what you argue in the piece.

DREZNER:  Sure.  Thanks, Gideon, and thanks once again to Foreign Affairs for printing the piece.

The precise is pretty simple.  If you take a look at any sort of measure of power out there, it's quite obvious that China and India are becoming much more powerful.  And projections in the future, although the future can always change, but the projections are they will become, you know, among the top five states in terms of economic size or what have you within the next 15 years, 15 to 20 years.

The problem we've got is that most of the really important international institutions that were set up were set up between 1945 and 1955, and China and India were not nearly as powerful back then.  This gives rise to an interesting problem, which is how do you cut in rising states to international institutions that have already been set up, that privileged states that are on the decline, such as many that are potentially in the European Union.

You would not think that the Bush administration would be well suited for handling this problem, since the administration -- you know, first impressions are lasting impressions, and the impression of this administration has been it's a belligerent, unilateralist foreign policy course of action.  And yet the funny thing is that if you take a look at what the U.S. has done over the past five years or so, they've taken several steps to try to cut in the Chinese and the Indians into international regimes that the U.S. had set up with the idea that if we can cut them in, they might actually in the end want what we want and support what we want.

The piece then reviews a variety of ways in which we've done this in the IMF, in the non-proliferation regime, both bilaterally and multilaterally, and on the whole gives the administration, you know, a decent grade in terms of doing this.  Now certain things have handicapped it.

One is the fact that it's easy to paint this administration as unilateralist and belligerent, and as a result, there are ways in which, even if it's doing things for the right reasons, it might be accused by some states of doing things for the wrong reasons.  So therefore, this creates a lot of suspicion.

The second problem which was going to be inevitable to this enterprise is that if you're trying to cut in rising powers, sort of by the nature of power you're undercutting states that are falling, and the states in this case are the members of the European Union.  And while they see the handwriting on the wall as well, you know, it's not like France and Great Britain are going to be giving up their U.N. Security Council seats any time soon.

So as a result, the administration on the one hand faces a thankless task, because trying to rewrite the rules of global governance are not easy.  But at the same time, I'm arguing that if they don't do it, if China and India aren't made to feel like they are responsible, you know, great power members of the existing world order, they're going to go out and create institutions of their own, and the institutions that they create might not necessarily be ones that the United States would like to see.

ROSE:  So let's start back for a second with the idea that the Bush administration actually sees this nєω ωσrℓ∂ σr∂єr and thinks of it in terms of a multilateral, institutional approach -- that runs counter to most people's view of the Bush administration, so talk a little bit about that.  Is the view that the conventional view of the Bush administration that's devoted to unilateralism and not caring about world order and -- or caring only about primacy if it does think of world order, is that wrong or is this occupying a place alongside it?  How does this -- how does the picture you're talking about coexist with the one that other people see?

DREZNER:  I would not say that that perception is wrong as much as it is incomplete.  Obviously -- you know, particularly if you looked at the first term, you know, it would be hard to say that the United States, you know, did not act in a unilateral manner.  And certainly the invasion of Iraq has -- you know, is the sort of apotheosis of this.

The problem is that does obscure a second component of the Bush administration's grand strategy.  And they were clear about this in 2002 as well as in the 2006 reformulation, which is the U.S. sees itself at a moment in time where it actually has somewhat decent relations with the -- most of the other great powers out there, and if it can therefore form, you know, what's the great power concert to try to, you know, sort of regulate world politics, it will do so.

Part of this also is the way I think that the Bush administration -- it's an extreme version of this, but it's the way Americans view, I would argue, multilateralism as opposed to, let's say, the Europeans, which is the Europeans see multilateralism as an end in itself.  It's a desirable thing to have, and the process of multilateralism smoothed out world politics, whereas I think for Americans -- and again, the Bush administration is an extreme version of this, but I think it was true of the Clinton administration as well -- multilateralism is a means to an end.  It's a way in which you try to achieve your policy ends, and if the multilateral institutions are seen as effective, then you will pursue that course of action.  If they're not seen as effective, then you might see them pursue alternative courses of action.

So to some extent what's going on -- it's consistent with the Bush administration's view, because they want certain multilateral institutions to work.  And for those multilateral institutions to work, they've got to correspond at least somewhat roughly to the distribution of power out there, which means cutting China and India in.

ROSE:  Okay.

And give us an example of the institutions in particular that and -- what's the evidence for the pieces you're talking about?

DREZNER:  I think one example would be the IMF, where, you know, with -- during the '90s, when the Clinton administration was dealing with the Asian financial crisis, the perception of the IMF was that it was high-handed, that it was an agent of the United States, it -- you know, the reform, the sort of structural adjustment programs they recommended along the Pacific Rim bred a lot of resentment in some quarters, whereas, you know, 10 years later, the Bush administration actively supported a move to give China greater -- a greater quota, a greater sort of representation within the IMF, and is going to push for I think further reforms to try to give large -- you know, what you would consider advanced developing countries like China and India greater weight in terms of within that organization.

I think another example of this -- and this also gets to some of the trickiness in trying to do this -- is the nonproliferation regime, where the United States signed a bilateral -- the civilian nuclear cooperation deal with India, which was, I think, just sort of a reflection of the facts of life, which is India was never going to sign the Non-Proliferation Treaty as a non-nuclear member.  By engaging in this, the administration is basically acknowledging that fact but saying, you know, we can still cooperate.

ROSE:  China and India strike me as somewhat different, primarily because of the political context.  India, as you note, is being groomed as a sort of regional pillar and democratic ally and liberalizing their economy and developing a global trade partnership, as well as being a nice stable, liberal democracy.  And so can you imagine that fitting in with the United States and Europe in the sort-of advanced industrial democracy camp.

But China, rising even faster, and taking part in the global economy, still is not a player in the democratic -- in the political sphere, and might even be, because of that --

DREZNER:  A negative player, yeah.

ROSE:  A negative player, exactly.

So how will that differ?  Are these -- how does the administration -- and as you say, one of the reasons for bringing India on and grooming it for this partnership is as a possible counterweight to China, and so forth.  So how does that play out?  I mean you talk about them as the two, you know, new Asian powers.  But one would seem to be able to be fit into the existing civilizational alliance, in some sense, or the democratic political community of democracies, and so forth, and the other would not.  How is that going to play out?

DREZNER:  I would say a couple of things.  First of all, on India I would highly recommend another article in this issue of Foreign Affairs that Ashutosh Varshney wrote, which would be worth looking at in terms of India's domestic situation.

But with regard to India and China, it's worth noting that the institutions that I'm talking about bringing these states on to don't have democratic foundations in the sense of they're primarily dealing with either issues of global security or global economics.  And on those two issues there's a lot more that China and India agree on than disagree.

There's no question that you're not going to see Chinese membership in NATO or any sort of similar sort of democratic club.  And I think, you know, down the road that's going to play a role in terms of U.S. foreign policy.  And there's no question that the U.S., in part, is trying to bring India in as a counterweight to China, and all three countries know this.

But at the same time, the U.S. can't ignore China.  You know, its economic weight is becoming too big now.  And that's partly what's going on.  The administration is trying to get out in front of this, but they're also reacting to what's happening in the real world.  China is simply too big to ignore now.  So on issues where there is going to be some commonality of interest, where there is going to be an interest in maintaining global stability, yeah, the Chinese can be counted on to act in a responsible manner.  And indeed, you know, some of the studies I cited in the article -- Ian Johnson at Harvard and Robert Lawrence -- have noticed that when China joins both security and economic institutions, they wind up becoming sort of status quo powers, states that wind up articulating policies that are very consistent with what the United States wants.

ROSE:  Back in the -- you know, during the middle part of the century, in the third quarter of the 20th century, you had the development of institutions like the Trilateral Commission, which formally enshrined a sort of America, Europe and Japan, this tripartite condominium, in certain respects, relationship.

Do you expect to see not just India and China brought into universal institutions, but do you expect to see any sort of institutions directly and specifically engaging them, as individual countries, in a way that we brought Japan into something like the Trilateral Commission?

DREZNER:  Well, I mean, the Trilateral Commission's a nongovernmental body, which -- it raises an interesting question, which is whether you're going to see --

ROSE:  Reflecting the sort of elite views of this kind of notion that Japan was now a partner.

DREZNER:  Yeah.  I mean, I think you're seeing it already.  I mean, you saw it in the Davos forum this year, where the theme was, you know, developing countries and the sort of diffusion of power, where I think India, you know, had a, you know, large representation at the Davos Economic Forum.

So yeah, I think you're going to see moves at the elite level, and that would actually make a fair amount of sense.

ROSE:  And things like the Strategic Economic Dialogue and so forth and --

DREZNER:  And bilaterally, I mean, the U.S. has launched ambitious dialogues with both China and India.

The interesting question in the future, I think, is going to be whether there's continued political support for doing that at -- let's say after 2008, after the 2008 election.  My suspicion is, regardless of who's elected president, eventually they're going to come to the same conclusion, but there might be some stumbling around in the first six months.

ROSE:  Okay.  Go forward.  Where do you see this all trending in the next 10 to 20 years?

DREZNER:  In the next 10 to 20 years, it's going to be interesting.  I think the fundamental question is going to be whether, you know, the sort of shift that the Bush administration has started and presumably will be continued by whoever wins in 2008 is going to be successful both in bringing China and India into these institutions and also, you know, roughly speaking, getting them to want the same things that we want.

I mean, the big $64,000 question is China's regime and, as you said, whether or not China's regime maintains the current outlook -- the current regime type that it's got or whether there's going to be some instability.

That said, I think the biggest problem you're going to have is trying to get countries on the wane -- namely, the European Union -- to agree to arrangements that give these countries greater -- you know, give these rising states greater power.

And then the next question's going to be, are there any other countries out there besides China and India?  You know, is Brazil going to demand a piece of the pie?  Is South Africa?  To what extent are you going to see -- I think the really fundamentally interesting question is, are you going to have cleavages based on development, where you've got China, India -- and you see this already in the WTO, where China, India and Brazil do hold sort of similar policy positions.  But in the future, that might not necessarily be the case as some countries acquire more middle-income status.

ROSE:  One country that doesn't figure in analysis in any of the various camps is Russia.

DREZNER:  Yes.  That's true, because I didn't talk about energy.  You know, I mean, beyond that, the fact is -- is that, you know, in the long term, as you say, 15, 20, 30 years from now, you know, the line is, "Demography is destiny," and in that case, Russia doesn't look terribly good.  Its demographic future is not a terribly promising one.  It's the same reason I didn't mention Japan, either.  Both of those countries demographically are not moving in a direction that indicates long-term economic growth.

ROSE:  Got it.

Okay.  Thank you very much, Dan.  And at this point, why don't we turn it over to our questioners and fire away.

OPERATOR:  If you'd like to ask a question, please press the star key, followed by the 1 key, on your touch-tone phone now.  Questions will be taken in the order in which they are received.  If at any time you'd like to remove yourself from the questioning queue, press star-2.

(Pause.)

ROSE:  Okay.  Well, while we're waiting for some more questions to be generated, Dan, are there any other thoughts that you have and that you've been led from this or -- in the writing of it, did you come across new ways of thinking about it that you hadn't expected?

DREZNER:  Well, as I said, the whole enterprise is interesting, because I'm basically -- I'll be interested about the reaction it gets.  Because making the argument that the Bush administration is pursuing a very subtle form of multilateralism is not the common perception of what the -- how the administration behaves.  So that's been interesting, just trying to make that argument for others.

And then the other -- I think the more interesting question in the future is going to be, to what extent does -- to what extent is the administration doing this because it's consciously doing it, as opposed to sort of seeing the handwriting on the wall?  And I think that's going to affect what happens in 2008, as well, which is even if you have, let's say, a Democratic party candidate who, you know, has adopted, let's say, a tough protectionist line on China or India -- what they wind up doing once they actually take power.

ROSE:  Do you see different attitudes in different sectors or bureaucracies of the U.S. government?

DREZNER:  Yes.  There's not question about that.  I mean, part of it -- you know, part of what's going on and why this has sort of been more and more salient feature of the second term rather than the first term is, you know, the neocons are on the wane.  Neoconservatives were not necessarily big enthusiasts of cutting deals with China on a whole variety of topics, and it's not like they're big fans of multilateral institutions to begin with.

So there's no question that as you had Condi Rice, you know, go from NSC to State, and as you have Henry Paulson take over as Treasury Secretary, certainly you've got some heavyweights in the administration that actually have an interest in pursuing this policy, whereas in the first term, you know, maybe you had Colin Powell.  But even Powell was so marginalized -- and so unwilling to travel, I might add -- that he didn't have enough of a profile to be able to do anything.

ROSE:  And what do you see in terms of the implications of this for the institutions themselves?  Are you going to see, because of the kinds of areas of cooperation or because of the memberships that you're talking about and the functional differentiation or, you know, specialization in terms of the issues they deal with -- are certain global or multilateral institutions going to become more important and others less important over time because they can adapt more or less easily or are needed more or less to deal with the new power structures?

DREZNER:  I mean, I don't doubt that's the case.  You know, the institutions that are somewhat more nimble in terms of adjusting and bringing in -- I mean, there's a paradox here, which is that the institutions that are more nimble, that are better able to bring in rising powers, might be less well-respected.  I mean, part of the reason -- you know, one of the questions is, what's in it for China and India and for rising powers to get membership into these organizations, to get more influence, if they're being asked to change their views somewhat?  And the answer is that they get respect; they get recognition.  And that's not a small thing if you're a rising power.  One of the things you want as a rising power is the recognition by others that you are, you know, on the rise and should be granted respect there.

I think, you know, as I said in the article, it's clear that the economic institutions are the ones that are making the adjustment quickest.  I think the institution that in the future that's going to be the really interesting one to see how it reacts to this is NATO, because NATO obviously can't include these organizations.  It's got a more regional focus.  But NATO has been the linchpin through which, you know, the United States and Europe have managed to cooperate.  And what's going to be interesting down the road is to what extent NATO is still considered a relevant player.

I think in the economic realm, the parallel would be the OECD, which is a club of advanced industrialized states.  And it's going to be a long time before either India or China are considered advanced enough to join.  And until now, the OECD was considered not only the rich man's club, but also the club of states that basically ran the economic sphere of the world.  And I'm not sure that's going to be the case anymore.

ROSE:  Interesting.  So with the rise of China and India as extraordinarily powerful and liberalizing lesser-developed states or developing states, you will break the link between economic power and development in some sense that you've had.

DREZNER:  Right.  Well, I mean, it's because China and India are so large -- and this is actually the thing I touched on in the book that's coming out, which is what's fascinating about China and India -- and this is really going to be a first -- that China and India in terms of their overall economic size in terms of GDP are going to get to the U.S. level or, you know, get to great-power status long before their per capita incomes reach anything approximating middle-income status.  And that's the fundamentally interesting thing.  They're going to have states that, you know, in terms of aggregate economic size are as powerful or approaching the U.S. size, and yet their preferences are going to be dramatically different because they're just still going to be fundamentally poor countries.

ROSE:  That's very interesting, especially because when you think about it in historical terms, they won't be economically undeveloped in historic -- compared to where previous great powers were when they became great powers, but in the contemporary context, they will.

DREZNER:  (Inaudible word) -- terms, yeah.  I mean they won't be as rich.  And look, I mean, one area where this is clearly going to come up is going to be in global warming, which is the extent to which China and India are going to be asked to adopt measures to reduce greenhouse gas emissions.  I mean, even if the U.S. -- if the U.S. ever changes its position, the position is going to be, "Well, China and India need to change too."  And their response is going to be, "Well, why did the U.S. and the other advanced states get a free pass for the previous century?"  And it's going to be an interesting debate.

ROSE:  Let me ask one last question if we don't have any from the floor, which is, people have talked about this often in terms of U.S. power and U.S. hegemony, and there's been a sense, as you say in the piece, that power is a zero-sum game, so that India and China's rise are coming at the expense of Europe's position and so forth.  But one interesting question is, will that come at the expense of the U.S. position?  Or will the U.S. be able, by tweaking the membership of the club in various of these institutions, be able to sort of not so much divide and conquer as, by manipulating its role as the chief arbiter of who gets in and who has what kind of thing and who gets its favor and its alliance, will the U.S. role necessarily diminish and U.S. power necessarily fall back towards the middle as these new ones rise?

DREZNER:  I mean, that's a possibility, there's no question about that.  I mean, you know, it's easy to point to the decline of Europe, but this might potentially lead to at least some relative decline i the United States.

I'm a little more optimistic about the U.S., just because first of all, the demographic profile of the United States is much healthier than Europe in terms of sort of, you know, birth rates and the extent to which you've got an active labor force supporting a retiring -- supporting pensioners.  That's one thing.  And the second reason is that our fundamental advantage is that our labor markets are much more flexible and also we're more receptive to immigration.

So as a result, I mean, the U.S. might -- you know, it's not going to ever grow again at 10 percent a year, you know, the growth rates that you see in India and China.  That said, because it's starting from a larger base, it doesn't necessarily have to, and because of its technological lead.  It's going to be a longer -- it's going to be a couple decades, I think, before you need to talk about whether or not the U.S. is going to actually be eclipsed by any of these countries.

And the other fact is -- and this is important -- is that although China and India are rising, you know, there are a lot of reasons why they might -- both states might encounter serious amounts of political instability along the way, whereas the U.S. political system, even in the polarizing era we are now, is considered much more stable.

ROSE:  So it's less the rise of multilateralism or the decline of the U.S. as it is the U.S. changing its dance partners or increasing the size of its harem.

DREZNER:  Yeah, I would say it's more expanding the option -- expanding its dance partner options.  You know, as I said in the piece, it's not that -- the United States needs the European Union, needs the EU members because on a whole variety of issues we actually agree more with Europe than we agree with other countries.  But there are other issues, particularly on economic growth, where we're much more simpatico with China and India than we are with the European Union.  So this -- if this is done well, if this is done adroitly, the U.S. can sort of pick and choose who its great power allies will be given the issue at hand.

QUESTIONER:  So Robin being joined by Bat Girl.

DREZNER:  Yeah, there you go.

ROSE:  And on that note, do we have anymore questions from the floor?

OPERATOR:  A question comes from Garrett Mitchell from the Mitchell Report.

QUESTIONER:  Hi, Dr. Drezner?

DREZNER:  Yes.

QUESTIONER:  First of all, I want to say that I think the piece is excellent, and I really appreciate this conversation.  I want to ask a couple of questions about this calculus or potential calculus.  Let me just start with a simple one and add a couple to it.

If -- I'm interested if you took the sort of current line-up of players and said, all right, everybody on this side of the line is for the concept that some sort of reform or restructuring of these current institutions needs to take place to recognize that the world order in 2006 is different from the one in 1946.  And all those who are either, you know, against that or reluctant to do that stand on the other side.

I'm interested -- it's sort of like shirts and skins.   I'm interested to know, you know, in addition to us and obviously China and India and presumably Brazil, et cetera, who else is on the side that favors the reform and reorganization in the manner that you talk about?  And who are the powers that are against it?

A related question is, I was struck by something you said near the end of your article when you said developing countries on the periphery of the global economy can be expected to back Europe in resisting U.S.-led reform efforts, and that struck me as slightly counterintuitive.  And I wonder if you could just say a little bit more about that and explain that.

And then, I guess, the third question that it leads to for me is:  If you were sitting down with the national security team of the next administration, whichever -- wherever that comes from, and you were laying this out, what do you think some of the strategic steps that you'd be recommending to them might look like to move in the direction of this reform and reorganization?

DREZNER:  Okay.  Very good questions.  I think I can answer your first two in one swoop, which is who -- you know, who is on what side, the shirts and skins.

I mean, to some extent I would argue it corresponds just down to brute interest; which countries are growing at very, very high rates and which countries are not?  You know, the U.S. and China and India, and to a lesser extent Brazil and South Africa and South Korea -- you know, countries that are foreseen as -- perceived as being on the rise, particularly economically, would fall under that one category.

And then, on the other hand, you've got countries in the developing world that are not growing by nearly as fast a rate, namely in Africa and Latin America.  These countries also have relatively long standing colonial ties or ex-colonial ties with members of the European Union.  So it's not shocking that you'd see, you know, a similar kind of alliance between those two groups, which is why I argued that -- when I said countries on periphery, I was primarily referring to Africa on this.  Those states have very low growth rates on the whole, you know, with the exception of South Africa and Botswana.

And as a result, you know, in a world where, let's say, the IMF judges things based on economic size, they don't have a lot of influence to begin with.  The last thing they want to see is things corresponding to economic growth even more, where they lose out even relatively speaking to China and India.

In terms of sitting down with the `08 group, you know, with whoever comes in `08, what my advice would be -- I would probably give two pieces of advice.

The first would be if you're going to engage in U.N. -- the first is to engage in U.N. Security Council reform, which is namely cut India in and potentially Brazil, and keep it at those two.  I'm not necessarily sure you want to do any more, which of course is going to make it fantastically difficult.  But I -- the Security Council seriously worries me in the future, where it's this situation where Britain and France both have vetoes and yet India doesn't.  That strikes me as increasingly it's going to look more and more anachronistic.  And for the U.N. to retain any kind of influence, I think you're going to need to see the buy-in of large developing countries.

The other thing I think is going to be to have some more flexibility in terms of potentially the U.S. creating new organizations as a -- you know, because new organizations -- you know, you don't have to deal bureaucratic inertia and you don't have to deal with the past.  There might be some issues such as, let's say, the environment or trade where it might be appropriate to create new, more flexible groupings and clubs that actually bring in rising powers as well as our existing allies.

OPERATOR:  All right.  Once again, if you'd like to ask a question, you can press the star key followed by the one key on your touch-tone phone now.

There are currently no more questions.

ROSE:  Okay.  Well, this -- we all have busy schedules, and Dan, I want to thank you for your time and recommend his piece and the rest of the issue to all of you, and we'll see you -- or speak to you at our next call sometime down the road.

Thank you very much for participating.

DREZNER:  Thank you.

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