Over a period of less than five years, China will retake Taiwan and also bring much of East and Southeast Asia into a much tighter sphere of influence. Turkey and Saudi Arabia will build nuclear weapons and become dominant players in their regions. Russia will continue to nibble at the borders of neighboring states, including Latvia and Estonia, and NATO will lose its credibility, except for a few bilateral relationships, such as with the U.K. Parts of Eastern Europe will return to fascism. NAFTA will exist on paper, but it will be under perpetual renegotiation and hemispheric relations will fray.
This is not his forecast of the most likely future, but he tees it up as a pessimistic scenario.
I think that forecasting the emergence of other powers is easy if you think only in terms of the problems that the U.S. faces. But you get a different point of view if you think about other countries’ problems and ask, “Whose problems would you prefer?”
China is aging rapidly. It faces the problem known as premature de-industrialization, meaning that there is not enough demand for manufactured goods to provide a broad base of middle-class jobs for low-skilled workers. If giant cities connected by high-speed rail are the most efficient configuration, then fine. But what if that turns out to be a bad bet?
I do not agree that Turkey has a chance to be a dominant player in its region. Nobody in the region likes the Turks. The Turks don’t even like each other very much. There are major divides between urban and rural, between religious and secular. If they come to dominate, it will only be in a tallest-pygmy sort of way.
Saudi Arabia, like Turkey, has yet to show that its entire society is on board with modernization. If only a thin sliver of elite is ready to join the modern world, then it will have plenty of internal conflicts to worry about. It won’t be a dominant player.
According to David Halberstam, in the early 1960s at the height of the Cold War, the Soviet leader Khrushchev told Americans that Laos would fall “like a rotten apple” into Communist hands. Today, if we look around for rotten apples, meaning regimes that are failing to deliver for their people, we can find them in Cuba, Venezuela, North Korea, and Iran. If those apples were to fall, particularly the latter two, that would make up for foreign policy problems that might emerge elsewhere.
Again, Tyler is not arguing that the pessimistic scenario is the most likely one. But I think he gives it a notably higher p than I would.
RE: Rotten Apples
Isn’t it a whole lot harder to go from autocratic government to democracy than the other way around?
Aging or not, China will determine the future of the world simply because they have the military will and power to do so. Their dedication to disruptive military technology is second to none. And they are succeeding. See: https://www.scmp.com/news/china/diplomacy-defence/article/2158524/chinas-hypersonic-aircraft-starry-sky-2-could-be-used or read RealClear Defensee just about anymore. US defense spending is highly inefficient and unproductive by comparison, money burning to start a funeral pyre. China will be the global supranational entity for which Tyler Cowen pines.
Although I know very little about China, I bet you that I know much more than Tyler and most Americans. I worked there for a few years as an econ adviser. The Party’s main concern is still to keep power forever, a task quite difficult in any country but especially in such a large country. Post-Mao, the Party avoided tragedy by abandoning the re-education of the elite (from the old generations) and promising material prosperity to the masses (largely those born post-1940). The military and police may look like large forces but will never be strong enough to contain the masses if they rebel against the Party (one indicator of this possibility is the percent of young people attending universities, now several times higher than in 1975). The Party’s strategy to keep power is both to threaten foreign governments that may take advantage of their domestic weaknesses and control that their own people organize only to be rich (yes, ownership and control of large enterprises and banks are still a big issue). As all other countries, today China is a country with overlapping generations with different experiences, but this doesn’t mean that inter-generational differences are similar across countries; most likely, each country’s differences are too much determined by the country’s history in the past 100 years.
I agree with everything you’ve said, but I note that aggressive war is a tried-and-true method for leaders to revive flagging support (at least for a while). Also, China has been claiming Taiwan for decades and building military capabilities specifically to invade islands while holding off US carriers. 80% of the stuff in Walmart comes from China; they are in a strong position to deter US action economically.
It seems to me like the Chinese leadership has a growing motive to invade Taiwan and the capability to do it successfully, which makes me think that at least that part of the prediction will come true.
And district 13 is going to lead a rebellion!:
1) I still believe most economies and nations go down the Japan road in their form or fashion. The US economy with relatively low uemployment has truly hit this point. And yes I do think the real issue of the future is the richer we become the less average families can afford children.
2) My guess is free trade diminishes is still mostly supported. So there will always be tweets to EU and NAFTA and Asian trade but I don’t forsee big changes. Trump’s tariffs moves a bewildering and Brexit appears to have real road blocks. Eastern Europe will get a lot of Trump like nationalist.
3) China power will grow in the economic sphere and we are exaggerating their military power. China really does not like war and they are mostly focused economically. Yes China will fast-forwarding to the Japan like economy but there is still lots of poor farmers to move to the city. (And Japan per capita is growing as well.)
Otherwise I dont know how:
1) China will react to a Financial Crisis (for the debt they are putting on it will happen…Maybe not today, maybe not tomorrow, but someday.)
2) I do wonder what will happen when China investments in Africa or South America goes bust. (See Valenzuela and other African nations.) Will they are start a war?
And finally, somebody has to explain to me why diminishing military and foreign power for the United States is a bad thing in general. Every time I see the US exerting power, it always seems to lead to c ounter-action that hurts our nation. (think Russian sanctions here.) And the US overspends on the Military that has little to do with our immediate national defense. Why can’t we be like many European nations have no longer have colonial powers and yet seem to live the good life?
In terms of rotten apples you identify, I really wonder why we can’t simply say these nations are failing to deliver to their people and let them be. High level why are making Iran such an issue so important? Why can’t we just be like China that trades with them.
Well, I think that it is reasonable for basically everyone to want the middle east to remain free of nuclear weapons (i.e. that isn’t a good outcome for the US, the EU, Russia, or China). Also, Iran and Saudi Arabia are trying to use the rest of the Middle East to fight proxy wars with each other. That is a large part of the reason for the refugee crisis, and why say Egypt and Tunisia didn’t end up with civil wars but Syria did (because both Saudi Arabia and Iran were funneling weapons and supplies to the opposing sides of the Syrian conflict). In terms of the other rotten apples, we mostly do just leave them alone or at worst impose economic sanctions (Venezuela, Cuba, the central Asian ‘Stans, Egypt, Morroco, Zimbabwe, etc.)
Basically, I wonder why we treat Saudia Arabia so well as a great ally while Iran is the great evil. In terms the 911 attack the lines go directly to Saudia Arabia more than any other nation and yet we fight proxy wars elsewhere (Iraq, Libya, Syria, arguably Yemen, and sanctioning Iran.)
TBH, I don’t why we can’t just be like China…We trade with both nations and take no side there ridiculous proxy wars.
I don’t understand the US’ relationship with Saudi Arabia either.
There are a few reasons. We’ve been allied with the House of Saud since the 1930s, and our habit of electing Texan oil men kept the affinity alive. They’re a useful counterbalance against Iran, which hates us for some rather good historical reasons (Google “Kermit Roosevelt” if you’re interested). Mostly, it’s that anything that topples the Saudi monarchy will likely be horrible, and once Mecca is up for grabs the stakes get scary quick. You saw what America did after 9/11; what do you think 1.6 billion Muslims would do if the Kaaba blew up?
I rather simply be China…Trade with both Iran and Saudia Arabia instead of trying to control and protect the House Of Saud. Hell, I don’t even want to be Canada and complain about human rights. (Although I snicker that Saudia Arabia is supporting the freedom of Quebec which was an issue over 20 years ago.)
Unfortunately, I think our backing the House of Saud for decades is making them a bad actor in the region and over-confident of their actions in the region. I am not saying Iran is good actor but Saudia Arabia (an private citizens) probably support terrorism more than Iran.
@ Jay
Thanks for the explanation. I hadn’t thought about what instability in Saudi Arabia might do, but that is a good point about how intense and bloody a war there might be if Muslims throughout the world thought that control of Mecca was up for grabs. Suffice to say that it seems there might be a sort of world war if that happens (although one confined mostly to Muslim countries).
The aging and depopulation of Asia is the big story of the decades to come. No matter what your are doing right a TFR of 1.0 is a death spiral. Increasing fertility is going to prove hard.
I also wonder how fertility trends in Asia impact immigration into the US. Immigration is mostly a young man’s game, so I would expect that as the economic conditions in Asia improve and as fertility falls, Asia will send the US fewer immigrants in the future than they do now, similar to how net migration from Mexico is basically at zero since the great recession (and also due to a better economy in Mexico and a lower fertility rate). So unless African immigration to the US dramatically increases in the next few decades, overall US immigration might well see a long term secular decline.
The rotten apples in Central America (El Salvador, Guatemal, Honduras) send more people to the US than does Mexico and they have for a while now. Nicaragua may soon begin producing refugees in sizable numbers. Then there is Haiti, which would have to be considered among the rottenest of the rotten, and produces a steady stream of illegals. So I would not assume that the flow of people to the US is going to dry up anytime soon. It may be a mistake to focus on Cuba, Venezuela, North Korea, and Iran as rotten apples to the exclusion of low-performing capitalist states. The US would be doing itself and the people of the Caribbean and Central America a huge favor if it would find ways to provide efficacious assistance in producing prosperity there. If one of these nominally capitalist countries could turn itself around without resorting to authoritarianism, it would be a truly useful and instructive example for people around the world.
I have read that the golden triangle countries have fertility rates that are declining pretty rapidly and economies growing at a fast enough clip that within a decade or so they will dry up as a source of immigrants just like Mexico. As for Haiti, it is much poorer than any other country in the Western hemisphere, but its total fertility rate is at about 2.72 right now and trending downward, so while they are likely to continue to send immigrants to the US, they might not send an increasing number of immigrants to the US in the future.
Currently we receive what is effectively tribute from Asia in the form of conscientious high IQ people who are willing to produce lots of goods and be paid in IOUs of questionable value. We are also able to pluck some of their brightest after the home country has already paid to raise them to adulthood. This is a huge windfall for the west which can’t continue forever.
A nice way of putting it.
Harry G. Johnson spoke of “National Socialism which recruited many of the best minds of Europe to the English speaking world.”
That seems to continue now with some of the East Asian immigrants, except the motivations differ (not driven by the Nazis).
An odd aspect of the US immigration policy is the quality may be “bi-modal.” The brilliant and rich can often come here, and a non-random subset of the impoverished and traumatized from some of the most dysfunctional countries on the planet (Haiti, Somalia, Liberia, insert more countries as you see fit).
It seems invidious to discuss immigrant “quality,” and therefore often not enough cold-blooded debate is done. We have much of the data already to make plausible predictions.
I read somewhere that people tend to stay in their SES quintile. People from Mexico who are in the bottom quintile there end up in the bottom quintile here–their children may climb to the 2d or middle quintile–or maybe not.
And did Japan overtake the US? The theories on Japan in 1990 were pretty wild. I suspect China will do well (especially with a much bigger population and Japan has lots of issue but still rich) but there is limit to manufacturing economies at this point. And also I have to assume that there will be real issues when a nation has to fail on Chinese debt (Valenzuela? Peru?) and then becomes the great villain of South America or Africa.
At a basic level, China will continue to grow and increase global power. However as the global power increases, the more issues that will create for China.
Has Japan overtaken the US in what way? Japan doesn’t have a desire (or need, so long as the US is the gloabal and/or Pacific rim hegemon) to project all that much power on the global stage. Japan has a highly developed economy, consistently very low unemployment compared to the US and Europe, and the cost of housing in Japanese cities (including Tokyo) has been stable or declining in the past couple of years while square foot per inhabitant has been increasing. Certainly Japan has problems, but comparing Japan to the US seems like an apples to oranges comparison, especially in geo-political terms.
Depopulation? Maybe eventually. But not any time soon. And starting from a pretty high base.
A total fertility rate of 2.0 leads to a very slow decline–eventually. A TFR of 1.0 leads to a halving of each new generation. The math says that if that continues, you have a “death spiral.” In that case, in less than 150 years, China’s population could be only 300 million.
I’ll believe it when I see it (but I won’t be around to see it).