A three-way struggle for global dominance

The world is about to see another cold war being fought. This one will be different from the one that was waged from 1945 when Germany was defeated by the United States, the Soviet Union, and Western Europe, to 1991 when the Soviet Union collapsed and Communism as an ideology of governance died. In this period of 46 years, two global powers fought “coldly” to gain the support of the rest of the world. The struggle between the United States and the Soviet Union took the form of alliance formation with each superpower attempting to persuade the rest of the world that it was following a more efficient and effective way of governance. They were pursuing ideologies that differed in the role that was assigned to the state.

The Soviet state was all powerful. It owned practically all economic assets in the country and distributed the incomes that flowed from them in any way it wished. Many in what came to be known as the Third World — the superpowers were the two other worlds — believed that the Soviet system better suited their circumstances. The United States, on the other hand, believed in individual rights. The state could regulate the economic system but only lightly while properties were owned and managed by individuals. Incomes that came from the ownership of economic assets went to individual owners who paid a little bit to the state to develop and manage what were called “public goods”. Defence as well as building and maintaining communication and physical infrastructure were the responsibilities of the state and were financed by taxes paid by individuals.

The Soviet leadership had convinced many in the Third World that its system had produced higher and more equitable rates of economic growth compared to what was on offer from the United States’ system of capitalism. Jawaharlal Nehru, India’s first prime minister, was one of the leaders impressed by the Soviet system. He built a powerful Indian state, not by nationalising private assets but by having the state invest in heavy industries. Pakistan landed on the other side of the Cold War divide. It opted to join the alliances Washington had built to contain the spread of Communism in Asia. Under General Ayub Khan, Pakistan’s first military leader, Pakistan became a member of the Central Treaty Organization, the Cento, and of the Southeast Asia Treaty Organization, the Seato. In fact, it provided the link between the two defence treaties. About the time of Nehru’s death in 1964, Alexander Gerschenkron, an American economist of Russian origin, established that the Soviet system of estimating the size and growth in national product had built-in upward biases. Correcting those, he showed that the Soviet Union had a smaller economy which had grown at a much slower rate of growth than claimed by Moscow.

However, it was not its claim about economic performance that resulted in the collapse of the Soviet Union in 1991 but its effort to expand its control over some of the countries that were on its border or near the border. It first encouraged the Communist Party of Afghanistan to capture the state and when that did not quite work out, it sent in its troops to install the government it wanted in place in Kabul. The Soviet troops entered Afghanistan in 1979 and stayed in the country for ten years, fighting the highly motivated groups of Afghan mujahedeen who had been armed by the United States and Pakistan. Moscow, admitting defeat, withdrew its forces from Afghanistan. Admission of failure weakened the Communist state and the Soviet Union collapsed. Moscow was back being the capital of Russia rather than the headquarter of the Union of Soviet Socialist Republics, the USSR. This event was celebrated by Francis Fukuyama, and American political scientist, who called it the end of history and wrote a bestselling book that carried that title.

In fact, history had not ended but was repeating itself. Great power competition for global dominance was back — this time the USSR being replaced by China as the US competitor. The Chinese economy grew rapidly, expanding manifold from 1980 to 2010 when the then Supreme Leader Deng Xiaoping opened the country to the world outside. The result was a dramatic increase in Chinese exports to the West which contributed to a sharp increase in the rate of economic growth. Before the end of the 20^th century, China had overtaken Japan to become the world’s second largest economy after the United States. It is widely accepted that with a decade or so, China will overtake the US and become the world’s largest economy. These growth numbers are not fake as they were when the USSR claimed to be seeing high rates of growth. The size of the Chinese economy and its rate of growth were estimated by institutions such as the World Bank and the International Monetary Fund. The growth in the Chinese economy was translated by Beijing into growth in the country’s military prowess. This worried the Americans whose two recent presidents, first Donald Trump and now Joe Biden, have decided to challenge China as a part of state policy. A new “cold war” has been launched and once again India and Pakistan have opted for the opposite sides. Washington has recruited New Delhi as a member of what Shinzo Abe, a former Japanese prime minister, had labelled the “quad” — an alliance among four Pacific powers viz, Australia, India, Japan and the United States. The quad is a part of Washington’s Indo-Pacific Alliance and is meant to contain the increasing influence of China in Asia. Beijing is using its enormous and growing wealth to improve connectivity with the world to its west. To achieve that goal, it has launched what its powerful President, Xi Jinping, calls the Belt and Road Initiative, the BRI. Although not fully defined, the BRI would cost Beijing more than a trillion dollars. China-Pakistan Economic Corridor, the CPEC, is an important component of the BRI.

Watching these developments with considerable concern, ambitious Russian President, Vladimir Putin, who — not unlike China’s Xi — has amended the constitution to give himself a long tenure in office. He has begun to flex his muscles. The American pullout from Afghanistan has given him the opportunity to fulfil his expansionist ambitions. He is secret of his unhappiness at the breakup of the USSR and the resulting shrinking of the territory over which Moscow had control. The return of Russia as an expansionary force has brought another participant in the new Cold War. A three-part conflict involving the United States, China and Russia would be complicated development for the world to manage. While Washington has entered into active negotiations with Moscow, this is not being done with Beijing. The reason could be that President Putin has begun to aggressively mass his troops on his country’s border with Ukraine, sent his forces into Kazakhstan to deal with mass demonstrations in that country, and carried out military exercises near the border with Afghanistan. China has not shown any visibly aggressive intent.

Published in The Express Tribune, January 18^th, 2022.

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