Scheherazade S. Rehman is a professor of international finance/business and international affairs at The George Washington University. You can visit her homepage here and follow her on Twitter @Prof_Rehman.
Last week we began the discussion on the possibility of "a new world order" in which potential new superpowers would rise—the prime candidates being the European Union, Brazil, India, Russia, Turkey, and China, in no particular order. We will take each of them in turn. These heirs apparent together with the United States account for more than 50 percent of the world population and approximate 66 percent of the global gross domestic product in nominal terms.
Any discussion of a rising new superpower does not imply that the United States will lose its hegemony; it simply means that the Unites States will have a "balancer" or an "equalizer" next to it. The EU serves as the most likely candidate as a potential balancer. If China indeed is a serious contender, it will not serve as a balancer but rather as an equalizer.
Today's discussion is on the latest winner of the Nobel Peace Prize, the European Union of 27 nation states, which accounts for more than 20 percent of the world's gross national product. It is the largest player in international trade and houses half a billion of the richest and most educated people in the world. It is without doubt the leading patron of global aid and boosts a respectable combined military budget.
The Europeans, albeit reluctantly, have acknowledge that alone as singular nation states, they are no longer able to sit at the grown-ups table. If the EU rises to be a superpower, it will have to be done together with the bulk of the 27 nation states. It will be a special kind of superpower in more than one way. First, the EU is a supranational entity and second, it wields what is known in international affairs as "soft power" as opposed to the traditional "hard power," which requires the presence of serious military might. Many Europeans believe they are already a superpower in this more unconventional "soft power" sense and point to being the "great balancer" for the world during the last Bush doctrine.
The nature of power and the nation state was altered beginning in the aftermath of the Cold War. It is becoming clearer that for the rising new superpowers the potential capability for destruction (military potency) although handy at times is becoming gradually more dispensable while the potential ability for production (productive economic activity) is becoming gradually more essential. (This is not to say that you do not need a serious military presence, but just less so than 40 years ago.) Given that the EU is the largest entity in international trade (percentage of share of world trade) this bodes well for its ascension to superpower status. This rather unconventional budding power's rise to great superpower heights, however, can only be achieved if, and only if, it can speak as one voice to wield international influence (perhaps in the form of an EU president on par with its counterparts).
That is, however, unlikely in the near future unless the EU feels truly threatened. Perhaps it is feeling imperiled as I write this blog. We are after all in the midst of the worst European crisis in 60 years. Is there a silver lining for future European generations in this mess? Yes, possibly. Regardless of the near term fallout of the severe austerity measures taking place in many of the 27 nations, it is forcing the Europeans to fiscally and politically integrate further; a prequalifer to becoming an effective soft superpower.
If, however, the EU does not manage to get its economic and political house in order relatively quickly—which means deeper and faster fiscal and political integration—the most likely alternative development for the foreseeable future would be that the Europeans are distracted from global affairs and simply "drift" as they spend the next decade reconciling their sovereign debt dilemma while trying to sustain their European way of life for their aging population. If it did come down to this, the EU would simply remain a big presence and not be very influential in actively shaping the world, much like Russia is today. It has experienced "Eurosclerosis" before (during the 1970s to early 1980s when there was stagnation). Rest assured that the geopolitical space the EU would leave behind would ultimately be filled by either 1) China, if its new government manages to do all the right things during the next 10 years—i.e. to have a more balanced economy (with both export and domestic demand led growth), easing government fiscal stimulus, and managing more widespread wealth generation amongst its 1.3+ billion population; or 2) Russia, if Putin is ever to get serious about Russian glory and resurrects the military-industrial complex abandoning his facade.
The Nobel Committee has done the EU a great service in its hour of need (surprising to some given the current havoc the Europeans are creating on global economies and markets) but thoroughly justified within the context of history and time. The rest of it, as always, is up to the Europeans now: to continue their evolution into a soft superpower, or embark on their "comfortable decline."