The great decoupling
It's an ugly word (fittingly for the age of Trump, full of sexual innuendo) but one that really captures what's happening: The integrated global economy that we got used to is breaking apart! This was a process well under way for some time, but COVID19 has accelerated the process. We need to start thinking what comes next and adjust our ideas accordingly.
However, amid Donald Trump's rhetoric and China's territorial assertions, it is tempting to start thinking about a new Cold War. But that's not what is happening now: The world system, we should justifiably fear, may be heading for a more profound change. For all its nuclear risk, the Cold War was about two mighty adverseries militarily balancing each other out, with trade and finance - at least in most cases - remaining limited to national boundaries or at least within the respective spheres of influence. But if we have a breakup, the world may no longer be so neatly divided and the post-war institutions and international legal framework, largely responsible why the Cold War remained mostly cold, may break down under the pressure of the new configuration.
In fact, instead of a bi-polar world, we may indeed get a multipolar one. One possible model for this coming world may be Michael O'Sullivan's 'Levelling' (See his interview here) where the world divides into Leveller and Leviathan countries. But even that - three spheres dominated respectively by US, China and Europe - is too neat. What would Russia do, for example? Or, for that matter, India? Nigeria - a country which is going to be one of the most populous - may not find an easy home in this world either? Would Britain return to Europe's fold or really become the 51st state of a Trump empire? And, besides, those are not even the key questions. The key question is that the global institutional architecture is based on certain assumptions: That there will be one or two overwhelmingly powerful nations willing and able to project power globally, that these nations would accept being subject to international law and would generally work together to keep peace and maintain global commerce.
The big challenge that we have at our hand is that the post-war institutions are unprepared to deal with such a world. Their key assumption is guardianship, that certain powerful nations will act as policemen of the world, reaping the benefits but also paying the bills. This did not allow for a Trump - who would rather just take the benefit - or a Johnson - who would approve of breaking international law in a 'very specific and limited' way. The institutions were not faultless and mostly they have done the bidding for powerful nations; but they at least prevented general wars for last 75 years and allowed the development of global technology commons. Once the institutional framework breaks, things that we take for granted will go away. The first to be in trouble may be WHO, but changes are coming: Decoupling may mean parallel GPS regimes, computer networks that may stop talking to one another (again), decline of English as business language and all sorts of changes in global standards regime. True, global standards have always evolved and may be we are due for a new one, but the change is not going to be painless.
Illustration credit: Lazaro Gamio/Axios