The Geopolitical Shuffle

Lots of important Russia news has come and gone since I was forced to turn my attention to preparing for my trip. Immediate concerns prevented me from commenting on the fall out from the race riot in Kondopoga, the assassination of Central Bank deputy chairman Andrei Kozlov, the continuing debate about the meaning and implications of “sovereign democracy,” the Russian government throwing roadblocks on the Sakhalin-Shell Oil deal, the proposal for an “all-Caucasian” amnesty, among many other things. Who knows if I will be able to provide some thoughts on these events since the news waits for no one.

Instead, I want to turn readers’ attention to some broader issues.

As I was shopping for some reading for my London-Moscow flight, I happened upon the most recent issue of the Economist. The cover immediately struck me. It read: “Surprise! The Power of the Emerging World.” The issue was devoted to the growing economic might of mostly China and India, and predictions of China eclipsing the United States by the middle of the century. As the editors write in “The New Titans”:

Emerging countries are looming larger in the world economy by a wide range of measures. Their share of world exports has jumped to 43%, from 20% in 1970. They consume over half of the world’s energy and have accounted for four-fifths of the growth in oil demand in the past five years. They also hold 70% of the world’s foreign-exchange reserves.

Of course there is more than one respectable way of doing the sums. So although measured at purchasing-power parity (which takes account of lower prices in poorer countries) the emerging economies now make up over half of world GDP, at market exchange rates their share is still less than 30%. But even at market exchange rates, they accounted for well over half of the increase in global output last year. And this is not just about China and India: those two together made up less than one-quarter of the total increase in emerging economies’ GDP last year.

And who is part of this cadre of “emerging” or as the Economist rightly puts it by adding a historical spin, re-emerging economies? They of course include China and India, but also Russia, Brazil, and Mexico. According to their projections for 2040, the top ten economies will respectively be: China, the US, India, Japan, Mexico, Russia, Brazil, Germany, Britain, and France. Presently, only China and Brazil are in the top ten.

The various reasons for this predicted dominance go far beyond my expertise in economics. Suffice to say that such a “re-emergence” (and the term is reserved for the fact that China and India dominated the world economy before Europe took off during the industrial revolution and what the Economist fails to remember in its historical analysis, imperialism) is not without geopolitical consequences. While there is no sign of a parallel Asian military block emerging because the US is cuddling up to India with hopes that it will become a bulwark to China, and China choosing not to transform its economic successes into military buildup, such a economic reorientation will undoubtedly produce geopolitical tensions. Some in the American sphere see this and reason that this is the real logic behind the Bush Administration’s military forays in Iraq and Afghanistan and political interventions in the Caucuses and Central Asia. Powerful states need fuel and access to oil is quickly becoming the “Great Game” of the 21st century.

Where does Russia stand in all this? While much of the Economist’s analysis focuses on the macro level, and when it does descend to the grown it focuses on China and India, Russia is included among the top ten by the middle of the century. One can guess that Russia’s growth will not be the same path as China and India. It looks unlikely that Russia will become the globe’s factory like China or the center of the informal economy like India. Russia, however, will undoubtedly be one of the fuel cells of both these economies. The question is whether this fact will push up the standard of living for Russia’s population.

If we follow Immanuel Wallerstein’s world system analysis, Russia has positioned itself as a classical periphery nation. It produces very little for an international market except for gas and oil, and imports virtually all consumer goods. One need only look at the streets of Moscow to see this. The Zhiguli is rapidly disappearing from the urban landscape only to be replaced by better built Japanese imports. Oil export has its limits and many point out, Russia consumes half of the oil it produces. Such a tend is likely to continue. The Putin administrations reliance on oil exports, places Russia at the mercy of falling oil prices and in the end might become, as Vladimir Milov, the President of the Institute of Energy Policy recently noted, an engine of stagnation.

Like the Economist, Wallerstein also sees the East’s eclipse of the United States. He argues that we are witnessing the birth of new interdependent geopolitical blocs without one center. Writing in the New Left Review he had this to say in regard to Russia’s position:

Three regions warrant special scrutiny because they are all currently in considerable turmoil, the outcome of which is likely to change the geopolitical picture: Europe, East Asia and Latin America. The European story is the best known. In the five years between 2001 and 2005, two major developments occurred in this region. The first was the direct outcome of Bush’s unilateralist revision of us foreign policy. Both France and Germany publicly opposed the US invasion of Iraq in the run-up to March 2003 and obtained support in a number of other European countries. At the same time, they made initial overtures to Russia, starting to create a Paris–Berlin–Moscow axis. In response, the us aided by Britain created a counter-movement, drawing most of the East and Central European states—what Rumsfeld called ‘new’ as opposed to ‘old’ Europe—into their camp. The motivations of the East and Central European states derived primarily from their continuing fear of Russia and hence their felt need for strong ties to the United States.

The second development was the defeat of a proposed European constitution in the referenda in France and the Netherlands. Here the lines were quite different from those over the invasion of Iraq. Some ‘no’ votes came from popular opposition to neoliberalism and fears that the new European constitution would entrench it; others from apprehension at a further expansion of Europe eastward, and the possible entry of Turkey into the EU. In both cases, those who voted No wanted a more autonomous Europe, capable of taking a greater distance from the US. But the combination of the two developments—the split over the invasion of Iraq and the defeat of the new constitution—has so far stymied any thrust towards a stronger, more independent Europe. The question is whether over the next decade this project can be relaunched on a firmer institutional and popular footing. It is still also an open issue whether such a revived European project, if it took off, would arrive at a political arrangement with Russia, such that we could speak of a Euro-Russian geopolitical pole.

While both the Economist and Wallerstein agree with the thesis of American economic decline, unlike the former, the latter does not sever the connection between the US military and economic dominance. In Wallerstein’s view, the Iraq war has exposed a fundamental contradiction of the American military: it has imaginable power, but a power ill suited for asymmetrical warfare. Still how one measures American decline is to get to this conclusion is key. The Economist focuses on hard numbers of economic and military might, while Wallerstein’s evaluation is in terms of the more ephemeral, but no less important, condition of American hegemony. In this respect the sole superpower is in dire straits.

The Euro-Russian geopolitical pole seems poised to benefit from American hegemonic decline. The EU is looking east for oil and gas and Moscow is happy to oblige though without complete subservience. Moscow maintains its power over the spigot like a mighty weapon. Thus the internal balance of the Euro-Russian axis has yet to be determined.

Suffice to say that a Kantian globe of “perpetual peace” is far from likely. Instead, we live in a time of massive geopolitical shift. Contrary to proclamations that the 21st century would be the continuation of the American Century, the world looks more and more as it did in 1914: a multipolar world with many centers bound by military or economic alliances which are competing over less and less spoils.

So, while many seemingly disparate events have evaded my vision in the last few weeks, I think that instead of playing catch up, it would be better to reemerge by positing some aspects of the larger global context. We so often forget, or worse, imagine that Russia is some isolated island that is outside of a world system that it is often necessary to take a moment and evaluate its present and perhaps future position in the global theater.