Preparing for new leadership
By Oh Young-jin
Assistant managing editor
Blame our collective short memory, perhaps comparable with that of a mosquito that faces its eventual demise by a swipe of the hand for repeatedly alighting on the same spot, or with that of a bad golfer who raises his head precisely at the moment of impact and shanks the ball despite repeated mental reminders not to do so.
In 2008, we had the fall of Lehman Brothers, a big U.S. investment bank, which triggered what has come to be known as the Great Recession.
Three years later in August 2011, S&P, one of the world’s top three credit evaluators, downgraded the U.S. rating, creating a panic across the world (don’t blame S&P; it was just doing its job).
As then, now Nouriel Roubini, a funereal professor of economics at New York University, talks about a doomsday scenario, this time more specifically a double-dip recession that couldn’t come at a worse time for the U.S. economy.
As then, stock markets throughout the world are shuddering at the prospect of a new economic crisis, with benchmark indexes tumbling and tens of billions of dollars evaporating in a matter of days.
There have been plenty of warnings.
Europe, the old man in the global economy, has been bickering without finding a solution to the debt crisis that has decimated PIGS ― Portugal, Ireland, Greece and Spain ― and is threatening the next tier of the eurozone hierarchy, starting with Italy. Germany, the pulse of the European economy, has been engrossed in its internal affairs, failing to provide leadership for the rest of the continent.
Perhaps it is out of the question to expect leadership from a nation that has been vanquished in two world wars and would be looked at with a heavy dose of suspicion for every step it takes.
Britain has long been out of the picture, bombarded by its own problems ― deficits, juvenile political leadership and the Murdoch scandal.
France is narcissistic, insisting that she is a beauty and denying what the mirror shows her ― a beast. If there was any shred of a chance for the revival of French leadership, Dominique Strauss-Kahn has single-handedly destroyed it.
Can the so-called emerging economies pick up where the current global leadership, headed by the United States and Europe, has left off?
A point of emphasis should be placed on the fact that the term “emerging” doesn’t necessarily mean vibrancy and youth, the hallmarks of a new leadership. For China, it has instability rather than vibrancy and immaturity in place of youth. It doesn’t want to be called a member of G2 because it doesn’t want to be bound by the responsibilities that come with it. Considering volatility from high inflation and obligations to feed the world’s largest population, China can’t afford to emerge as an alternative leader to the U.S., the other member of G2. It remains to be seen whether Beijing will ever grow to become the next global leader because of the parochialism that has been deepening as a result of mismatched political and economic systems.
Japan has had its own chances but now it has brought itself down to the level of triggering quarrels with its neighbor, Korea, trying to rob it of small islets in the East Sea.
South Korea is tied up by North Korea. For it to become a global leader, unification is a priority, although it entails a considerable period of readjustment and slows down its maturing process. Besides, Seoul is showing symptoms of premature adulthood as a nation with loss of vibrancy and unbalanced materialism. The biggest danger for Korea is giving up its competition with itself to become better and settling for status quo.
For the U.S., we have known its loss of leadership for quite some time.
It has been bankrolling its national livelihood on debts ― by selling IOUs to China, Japan, Korea and others. When that life of debauchery was exposed during the subprime loan crisis, it resorted to brinkmanship ― “Let me borrow more or I will detonate a debt bomb.”
The other day, New York Times columnist Tom Friedman captured the U.S. zeitgeist with the headline of “Win together, lose together,” although the piece was not on U.S. global leadership.
It can’t be denied that the world can’t be led by a nation that acts like a suicidal hostage taker who threatens to blow everything up.
The latest debt-ceiling negotiations in the U.S. allowed us a peek into this “American Psycho” mentality.
Knowing the consequences, John Boehner, the Republican speaker of the House, walked out of negotiations when the deal was close at hand. Obviously, the Ohio congressman didn’t want to allow Barack Obama, the first black U.S. president, any taste of accomplishment. If that was what he had intended, he succeeded, making Obama the first president to see the U.S. suffer a credit-rating downgrade on his watch. I don’t want to embarrass myself and talk about the collective conspiracy of a White America that can no longer tolerate the reversal of roles set during the Jim Crow era.
But the problem is that despite these problems, the U.S. is irreplaceable, at least for now.
More plainly, with the U.S. out of the S&P’s triple-A club, the United Kingdom, France and other club members are made irrelevant.
So what do we have now?
A leadership change takes place irrespective of whether the world is prepared for it or not. In other words, one rising power can replace an existing superpower; a number of powers compete for the supremacy of the defunct big power or simply a period of anarchy persists for a considerable period with no replacement powers in sight.
Or a new form of leadership that is different from our traditional concept of power may move in.
Perhaps, the Republic of Apple or Great Kingdom of Samsung may come into being and thrive with nations as we now know them providing only the pretense of a nation-state.
One sure thing is that transition often means a roller-coaster ride that promises a great number of ups and downs, not necessarily as safe as what you’d find at Six Flags. But make sure you enjoy it because we all are in this, whether we like or not