Forget G-8, try the G-Zero
Commentator Ian Bremmer says no group of countries can control the global economy.
We've entered the G-Zero world: where no single nation or alliance of governments can drive the international agenda. Before the financial crisis, we lived in the era of U.S.-led globalization -- and the way for any country to succeed was to align itself with that process. But this era is over. In the G-Zero, there isn't effective international coordination on today's most pressing challenges: climate change, nuclear proliferation, protectionist trade measures, resource scarcity, you name it. Absent a strong referee, the G-Zero is a more volatile, uncertain, and decentralized place. To succeed, nations need more than just growth because growth can prove fleeting in a world where crises abound. Nations now need to be able to pivot easily between international partners.
States that can pivot well are not overly reliant on any single power for their security or their economic health. Brazil is a great example. The United States was Brazil's largest trading partner for some 80 years. But over the last decade, Brazil increasingly courted China; today, it trades more with China than the United States. Brazil's approach is the same as any good investment strategy: diversify.
There are risks to trying to play both sides of the fence, to be sure. If Taiwan or Burma drifted too far from China, there would be repercussions. They know this. They'll reach out to the United States, but only to the extent that China will permit it and that's why neither one is a pivot state -- the risks preclude them from playing this game effectively at all.
So what's all this mean for the United States? Despite debt problems and political gridlock, it's still the world's largest, richest economy with strong political institutions and the rule of law. The U.S. still attracts more than its share of global investment, and that makes it hard for would-be pivot states to turn their back on it completely. The only problem? America's relative attractiveness in a G-Zero world allows it to procrastinate in solving the pressing challenges of tomorrow.