Why not, with a near-global economic meltdown in 2008, continuing wars against terrorism, the European Union threatened by the default of two countries and perhaps, more; policymaker’s having no ammunition to speed up recovery, political unrest and violence in the Middle East, increased signs of climate change and the recent earthquake-tsunami-nuclear trifecta in Japan.
There is no longer a sense of certainty among large segments of the world population, notably the U.S. middle class. They are concerned about their ability to maintain their economic status in the face of the above problems but add to that the economic rise of Asian countries led by India and China and the recent attacks by the U.S. Republican party on public service unions.
Looking at the political sphere, a new term has come into use in an attempt to describe present-day global politics. The term is “G-Zero.” The New York Times called it “this year’s buzziest buzzword” and it was frequently heard at the recent World Economic Forum in Davos.
G-Zero means that the world is currently in a power vacuum with no one country able to exert global influence. The United States is increasingly absorbed in divisive internal politics before next year’s election; Europe is in a multi-year struggle to save the Eurozone; Japan is now in a reconstruction mode following the recent disasters and China and India are focused on the next stage of economic development.
In the recent Thai-Cambodian border dispute, Asean mediation led by Indonesia did manage to establish a cease fire but troops still remain at the border, reinforcing the characteristically weak reputation of regional organizations.
At one point the G-20 grouping of the world’s most powerful and wealthy nations gave hope but the 2010 International Monetary Fund meeting in Washington and the G-20 meeting in Seoul laid bare the economic strategies of the world’s leading economies as they opposed each other.
The danger of G-Zero is that without any adherence to common standards there will be no economic security. The recent split in the European Union between the rich and poorer nations illustrates this and has resulted in bailouts of the poorer European countries by the richer European countries. Austerity budgets were then imposed on the populations of Greece and Ireland resulting in civil unrest.
However, as Matthew Lynn writing on bloomberg.com points out, “But if the Portuguese refuse to accept the austerity measures, what is Plan B? So far there hasn’t been any sign that anyone has thought of one. The euro area can pay for a Portuguese bailout. The 70 billion euros won’t matter much. But the final bill will end up being much costlier.”
The next step in the world’s political evolution could be a stronger United Nations but that could be a long-term struggle versus historically embedded nationalism.
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