研討，分歧，現狀，中國勝，返回美式和平

觀點研討， 更多分歧， 現狀， 中國勝， 甚至返回美式和平
觀點研討會

More bifurcated? The status quo? China wins? Or even a return to Pax Americana?
A SYMPOSIUM OF VIEWS

https://static1.squarespace.com/static/5d59c0bdfff8290001f869d1/t/62bb31211d201742b75e19a7/1656434979403/TIE_Sp22_WorldAfterUkraine.pdf

To what extent will the war in Ukraine, and the overwhelming global support for debilitating economic sanctions against Russia, lead to, first, a further decline in globalization, and second, a sharp turn to the bifurcation of the industrialized world powers? On one side would be the United States, Europe, the United Kingdom, Japan and other Pacific allies, and others. On the other would be Russia, China, Iran, North Korea and (maybe) India. Bifurcation of the global system could, for example, entail a move to separate currency systems, trading systems, SWIFT-like communications systems, technological infrastructures, and separate rules for space technologies, ocean navigation, even for accepted rules for warfare.

Is this theory of a sharp turn toward bifurcation compelling? If so, where does India, with its large navy, fit in? In the United Nations vote on the Ukraine issue, India voted on the side of Russia and China.

To what extent has Vladimir Putin’s handling of the war forced China in the direction of global bifurcation a lot sooner than Beijing would have preferred? Could this move lead to the potential return of Pax Americana with the West now seeming to believe in the American democratic ideal perhaps more than many Americans do? Or when the war is over, will the world simply return to the status quo? Or, as some are arguing, could China end up the long-term winner?

The World After Ukraine
Over two dozen international policy strategists offer their views.

Global bifurcation is imminent.
By SCOTT BESSENT
Founder and CEO, Key Square Group

The world is on the cusp of a Great Reordering.
Nobel Prize laureate Daniel Kahneman’s extensive writings on the bias of individuals and nation states to maintain status quo systems reveal an overwhelming inclination to preserve the current state of affairs. Retaining the current global trading systems and
economic supply chains are clearly no longer plausible. 

Global bifurcation is imminent. Initially, this ambitious rearrangement will be largely drawn along developed and emerging lines.

Western leaders achieved a bittersweet victory in a recent United Nations resolution calling for complete Russian withdrawal from internationally recognized Ukrainian borders: 141 out of 193 countries voted for the resolution. Countries voting against or abstaining represented more than 50 percent of the global population.

Those countries abstaining were overwhelmingly emerging economies, including China and India. Heavily dependent on Russian oil, wheat, and vital commodities, they cannot survive immediate disconnection from Russian products.

The world population’s twenty-four-month strife with Covid and the Russian assault on Ukraine have roused officials and citizens in Western democracies from complacency to action. In what may be the most important speech in her distinguished career, U.S. Treasury Secretary Janet Yellen outlined in clear and bold terms the early framing
of a new U.S. doctrine, calling for “friend-shoring.”

This crisis could not have come at a worse time in both the debt and inflation cycle for the global economy.

Having substantially increased government debt levels to support households and businesses for the past two years, Western leaders must now come to terms with balancing
rising inflation and debt service costs with additional defense and energy spending.
The fall of the Berlin Wall yielded what came to be known as the peace dividend: military spending was diverted back to domestic priorities. Should we not expect that heightened geopolitical tensions will have a high price tag? Will governments transition from the increased Butter spending to combat Covid to increased Guns outlays to protect against the rising threats of autocracies? Given the current environment, should they attempt both?

As the U.S. and Western allies implement friend-shoring, they should apply a muscular form of trade and economic statecraft to other countries—making it clear that qualifying as a most-favored-nation provider in the new supply chain paradigm will require adherence
to a code of Western democratic values, regardless of a nation’s internal governance system.

Naturally, as trade splinters along these lines, the role of the U.S. dollar in global payments and reserves will decline. However, no other currency alone will likely match
the dollar’s central role. Rather, as new trading and security blocs coalesce, the invoicing currency of choice and the composition of foreign exchanges reserves will shift
in kind.

In conclusion, these shifts are bound to carry shortterm costs in the form of higher prices and less abundant product availability. However, the Covid-19 shock
demonstrated the incredible resiliency and adaptability of free, democratic societies.
The views presented in this article are purely the opinions of the author and are not intended to constitute investment, tax or legal advice of any nature and should
not be relied on for any purpose.
<<<<<<>>>>>>
The war in Ukraine has given new life, and new purpose, to the security system in
East Asia that arose out of the destruction of the Korean war.

By DANIEL SNEIDER
Lecturer in East Asian Studies, Stanford University
Outside of Europe, the impact of the war in Ukraine
is most visible in northeast Asia. Naked Russian aggression, carried out with the strategic backing of
China, has reinvigorated the Cold War architecture forged
by a similarly brutal war fought on the Korean peninsula
more than seventy years ago.
The Korean War offers a compelling historical precedent for the war now embroiling Europe. In the late 1940s, U.S. policymakers clearly grasped the strategic
importance of Japan, both as an economic power and as a
frontline for the American military presence in the region.
Korea, on other hand, was a matter of debate. With the
formation of rival states in the north and south in 1948, the
United States had moved to reduce its military presence in
South Korea. While some American policymakers argued
that South Korea was key to the defense of Japan, the U.S.
military disagreed. They had their eyes on Europe and the
Middle East, where the Soviet challenge was manifest.
The Communist victory in the Chinese civil war
in 1949 bolstered the view that U.S. interests lay only
in defending an offshore chain of islands that ran from
Alaska through Japan, including the military bastion on
Okinawa, and down to the Philippines, a view famously
articulated by U.S. Secretary of State Dean Acheson in a
January 1950 speech. The American defense line pointedly did not include the island of Taiwan, where the defeated
Kuomintang had fled.
Soviet leader Joseph Stalin gave the green light to
the North Korean invasion of the south in June 1950,
convinced that the United States would not defend it and
was preoccupied with Europe. Chinese Communist leader
Mao Tse-tung, focused on gaining control of Taiwan, reluctantly agreed to support the invasion.
It was a profound strategic miscalculation. President
Harry Truman, seeing the invasion as the start of a global
challenge from Moscow, made the fateful decision to intervene in Korea. The West and its allies rallied to the defense of Korea. When General MacArthur’s troops neared
the Yalu river border with China, Mao took the equally
portentous decision to send a massive army into battle.
The United States put the 7th fleet in the Taiwan straits
and Chinese plans to finish the civil war were shelved.
The result of these events was the creation of the Cold
War security system in East Asia that remains remarkably
intact to this day. Ukraine offers an eerie repeat of those
events. The Russians have again miscalculated about
American and Western will. China has again become a
partner to this strategic disaster.
Doubts about American staying power, fueled by the
rise of China, are fading. In Korea, the Ukraine crisis clearly
aided the narrow victory of a conservative in the presidential election in March, one committed to a closer security
alliance with the United States, improving relations with
Japan, and confronting North Korea. Japan has responded even more intensely to the Ukraine war, seeing it as a
global struggle with clear reverberations for northeast Asia
in the need to defend Taiwan and significantly increase defense spending in response to the challenges from China
and North Korea. The Japanese public has embraced the
Ukrainian struggle with surprising emotionalism.
Ukraine has tightened the alliance system that stretches from Korea, Japan, and Taiwan down to Australia. The
Japanese, with an emphasis on careful diplomacy, are
working to bring India and Southeast Asia out of their currently non-aligned status, though it may take time.
Whether China comes to regret its decision remains
to be seen. Xi may be too locked into his bet on Putin to
retreat. But what seems certain is that the war in Ukraine
has given new life, and new purpose, to the security system in East Asia that arose out of the destruction of the
Korean war.

<<<<<>>>>>
Not an end to
globalization, but
a temporary check.
JAMES A. LEWIS
Senior Vice President and Director, Strategic Technology
Program, Center for Strategic and International Studies
Globalization ebbs and flows with the tides of conflict. The highwater mark for last round of globalization was a decade ago. It has been receding ever
since, as Russia and China assert themselves, as countries
extend sovereign control over technology and trade, and
as nations rejected the U.S.-centric world created in the
1990s. This is not the Cold War with two camps glowering
at each other across an Iron Curtain. There are too many
interconnections and too many other countries involved
for globalization to be easily unraveled.
This is not an end to globalization, but a temporary
check. The Ukraine crisis accelerates globalization’s retreat as sanctions broke links in finance and trade and as
countries like China quicken their efforts to become independent from the United States. Ukraine highlights
decision points in a new competition. For China, its ambitions have received a temporary check. It, like Russia,
assumed the West was in decline and could be challenged
with impunity. The quick Western response and damaging
sanctions on Russia were unexpected, since Xi, like Putin,
is not presented with contrarian views and the Chinese,
unfortunately, have a tendency to believe their own propaganda. China will not abandon its ultimate goals, but will
soften its tactics—for now—in how it pursues them.
Europe needs to make fundamental decisions on
where it will stand in the world. American protection affords it the luxury of incomplete federalism. Some
blame the United States for obstructing Europe’s aspirations, but European nations avoided hard questions on
the limits of their sovereignty. Europe thinks of itself as
a regulatory superpower, but this power is illusory as it
relies on the willingness of other countries to accept the
extraterritorial application of EU rules and does not reverse a slow European decline. It remains to be seen if
Ukraine spurs the difficult reexamination Europe needs
in order to recover from its failures in the twentieth
century.
Pax Americana ended years ago with the missteps in
Iraq and Afghanistan. A nation can’t lose two wars and
have a mob storm its capital and expect not to be challenged. Recognition of this in policy circles would be
helpful. The dilemma with the end of Pax Americana is
that no one else is able to pick up the burden of defending democratic values, but other countries ask whether
American political and social turmoil weaken it too much
to lead. This doubt complicates rebuilding partnerships
with other democracies, particularly the European Union,
something that will be difficult given Europe’s own indecision over its course.
What will globalization look like after Ukraine?
Some bifurcation with China is unavoidable (if only
because it is a Chinese policy goal), but globalization’s
next phase will be a competition over governance (who
sets the rules and standards) that, unlike 1990, will not
be based on shared assumptions on how the world should
work. Ukraine did not produce a sharp break but it did
accelerate an erosion of order and governance that we
will struggle to repair.
<<<<<<>>>>>>
The United States
is an island of
security and stability.
Over time that will
shift investment
and trade toward
the United States.
BY MICHAEL C. KIMMAGE
Ordinary Professor and History Department Chair,
Catholic University of America
T
he war in Ukraine is an event of such historical stature that there will be no return to the status quo ante.
This is first and foremost true for Ukraine, which
has been devastated by the war. It is also true of Russia,
which has fundamentally changed its relationship to
Europe and to the United States and is constructing a
newly militarized and repressive social contract between
its government and its population. Though formally a
conflict between two countries, the war in Ukraine has
already had global repercussions. These will continue
apace.
One foreseeable repercussion is not exactly the end
of globalization. It is the fragmentation of a globalization
already challenged by more than two years of pandemic.
New patterns are emerging, dictated by a sanctions regime
that thirty-plus countries have signed on to—for the sake
of punishing Russia for its war and for degrading its capacity to wage war.
Russia will attempt to build a network of trading
partners and will be shifting its sales of oil and gas to
Asia and to countries elsewhere that are not sanctioning Russia. The United States and its partners could respond with secondary sanctions that might force China
and other countries to choose between doing business
with Russia and retaining access to the U.S. and Western
economies.
Bifurcation is too simple a word for this dynamic.
There will be overlapping zones of globalization, some
of which interconnect and some of which do not. Neither
trade nor capital will flow as freely and easily as they did
before the war.
Cui bono? To a degree, both the United States and
China will lose out in this situation. Despite the friction
often on display between these two countries, they have
both benefited greatly from globalization, which is underwritten by the U.S. military (especially its navy) and
by the economic dynamism of China and the United
States.
But it is China that stands to lose more. The United
States is far from Ukraine and is an economic power with
access to the Atlantic and Pacific Oceans. It has interests
in Ukraine that stem from European security writ large; it
has few economic interests. The United States is also partnered with many of the world’s most advanced economies
in sanctioning Russia.
For China, Ukraine falls within its Belt and Road
Initiative. The war runs counter to major trading interests
for China, and China is partnered with Russia, a country
that has fallen into dictatorship and is locked in a criminal
and destabilizing war. Russia is a burden to China.
As globalization becomes more fraught and as regional war threatens to slide into world war, the United
States is an island of security and stability. Over time, that
will shift investment and trade toward the United States.
China will finds ways of adjusting to this brave new world,
but for Beijing, the road ahead is less certain and rockier
than it is for Washington.
<<<<<<>>>>>>
A return of Pax
Americana, China
as the long-term
winner, or a return to
the status quo.
My response? None
of the above.
MARINA V.N. WHITMAN
Professor of Business Administration and Public Policy
emerita, University of Michigan
T
IE’s query poses three possible scenarios: a return of
Pax Americana, China as the long-term winner, or a
return to the status quo. My response to this categorization of alternative future scenarios is “none of the above.”
The immediate effect of the Russian invasion has
been a reduction in globalization and an increased bifurcation between Russia and its allies on the one side and the
industrialized West on the other. Although Russia’s share
of overall world trade is only 1–2 percent, it accounts for
a significant share of exports of two critical commodities: energy and grain. Its recent attack on Ukraine has
produced both official sanctions by Western powers, including freezing the assets of the country’s biggest banks,
and the creation of additional sanctions by private firms
through over-compliance. These actions have led to reductions in Russia’s exports and imports and the disruption
of global supply chains. All of these developments run
counter to the nature of Pax Americana, which was predicated on globalization of trade and investment and the
maintenance of business relationships between countries
despite geopolitical differences.
China as the long-term winner from Russia’s attack
on Ukraine seems equally unlikely. China’s support for
Russia’s actions has been half-hearted at best. It has abstained from a United Nations vote condemning the attack, but its support for Putin doesn’t appear to have gone
much further than that. As one of the economic winners
from globalization, China could hardly favor a bifurcation of the world’s industrialized countries into the United
States and its allies on the one hand and Russia, Iran, and
other opponents of this “Western” alliance on the other. At
the moment, China is struggling to overcome the United
States’ economic dominance, while at the same time continuing as a major exporter to the American market. From
its point of view, a premature bifurcation of the global system would make its efforts to challenge the United States
economically, as well as in a geopolitical struggle between
the two systems of governance, even more challenging.
It is hard to imagine how a return to the status quo
could occur. Ukraine and Russia together account for
close to half of world grain exports, and the shortages and
global price increases their war footing are creating cannot be quickly overcome by new supplies. Russia is also a
major source of oil exports and of certain metals essential
to automobile manufacturing; its focus on war-related activities is contributing to shortages and price increases in
these commodities. This distortion of global supply chains
will inevitably have a negative impact on global growth.
And these are only the economic effects. In geopolitical
terms, the effect has been to pressure countries into “taking sides,” with Russia and its allies on one side and the
West and its Asian partners on the other. Germany, for example, has strong trade ties with Russia, but it is reassessing its permissive stance toward that country in the face of
its recent behavior. None of these developments is likely
to be reversed under current conditions. 
<<<<<<>>>>>>
The Ukraine war
helps China because it
absorbs U.S. strategic
energies in Europe.
JENNIFER LIND
Associate Professor, Dartmouth College, and Associate
Fellow, Chatham House
T
he international system had already been shifting in
ways that advantage China, and the Russian invasion of Ukraine will exacerbate this trend. China has
emerged as a formidable economic player, with not only
decades of “catch-up” growth but also a shift toward innovation: defying the predictions of many in the West who
thought this impossible given China’s authoritarian institutions. Between its economic rise and military buildup,
China has emerged as a rival great power, putting an end to
the era of U.S.-led unipolarity, and challenging American
military dominance in the Indo-Pacific. The Ukraine war
helps China because it absorbs U.S. strategic energies in
Europe—at a time when, after the Afghan withdrawal, it
looked as if Washington actually seemed ready to focus
on the Indo-Pacific. Putin’s war is likely to poison U.S.-
Russian relations for a long time to come. This is all to
Beijing’s gain; for example, Moscow’s enmity toward the 
SPRING 2022 THE INTERNATIONAL ECONOMY 21
United States led it to interfere in U.S. elections, ushering
in an era of domestic political instability and polarization.
China, as ascendant power, thus faces a distracted and internally divided United States that, rather than trying to align
with one of two hostile powers it faces (as Bismarck advised), is taking on both. Furthermore, Russia—isolated by
the West—is ever more dependent on China. To Beijing, the
tragedy in Ukraine is thus a geopolitical gift. 
<<<<<<>>>>>>
My best guess is
a world that is
not bifurcated but
trifurcated.
EDWIN M. TRUMAN
Senior Fellow, Mossavar-Rahmani Center for Business and
Government, Harvard Kennedy School, former Assistant
Secretary for International Affairs, U.S. Treasury, and former
Director, International Finance, Federal Reserve Board
I
n the wake of the Russian invasion of Ukraine compounding the disruption of Covid-19, the world economy and financial system will not return to the status
quo ante circa 2019. That world itself was unsteady and
uncertain and those forces have intensified. My best guess
is a world that is not bifurcated but trifurcated.
The collective actions in response to Russia’s aggression and the damage inflicted on the Russian economy and
its place in the global system are likely to sideline that
country for at least a decade regardless of the outcome on
the battlefield, which could remain undetermined for at
least another decade.
The principal components of the trifurcated world
will be the United States and other advanced and broadly
democratic countries, China and other authoritarian states,
and the rest of the world. China and the United States will
continue their competition. The United States will endeavor to maintain a coalition of the willing to resist China’s
more aggressive economic and political activities and new
initiatives. Other countries large, such as India, and small,
such as the low-income countries slowing recovering from
Covid-19, will try to thread the needle between the U.S.-led
and the China-led visions of the global economic and financial system. The structure of that system will not change
substantially from what it was like in 2019. The system may
evolve but will remain subject to substantial inertia despite
being subjected to economic, financial, and political shocks.
<<<<<<>>>>>>
Not a world of
bifurcation or of a
return to “Pax
Americana,” but
rather a world of
overlapping regional
coalitions.
EWALD NOWOTNY
Former Governor, Oesterreichische Nationalbank
A basic perspective on the world after Ukraine is one
of diminishing globalization. This process of “deglobalization” began at the start of the millennium, intensified in the context of the coronavirus pandemic, and is
now culminating in a sanctions regime, installed in reaction
to the Russian aggression. The various economic sanctions
will have strong short- and long-term effects on the Russian
economy. But they will also trigger a wide range of supply
and price effects on economies outside Russia.
While the United States provides the critical military
umbrella for these sanctions, it is economically in a rather
safe position. A number of European countries, however,
face the core challenge of high dependency on Russian
gas. Meanwhile, the Near East is highly dependent on deliveries of Russian and Ukrainian wheat. U.S. support will
not be enough to overcome these problems. In both cases,
the long-term solution is a diversification of supply sources and a general decrease of external dependencies. But
this will take time. A number of European countries have
therefore exempted pipeline-bound Russian gas deliveries
from the sanctions, so as to keep gas flowing to Europe.
The alternative would be serious disruption throughout
major European economies, Germany first and foremost.
Fast and efficient sanctions have been imposed on
the Russian central bank, especially the freezing of about
60 percent of its currency reserves. This, and in general
the weaponization of the U.S. dollar, may, however, lead
some central banks, especially the Chinese central bank, to
reconsider the allocation of their—substantial—currency
reserves. The U.S. dollar will remain the world’s leading
reserve currency, but shrinking “dollar dominance” is
already underway and may accelerate the trend towards
an increasing multipolar international monetary system.
This could make it more difficult for the United States to finance its excessive current account deficits, and imperil its role as the “consumer of last resort” of the world
economy—leading to further economic deglobalization—
and will contribute to the tendency of a downward trend of
economic globalization.
In general, war in Ukraine may lead to globalization
being increasingly supplanted by more regional forms
of economic cooperation. For the European Union, this
means closer and more efficient cooperation within the
European Single Market—a market with a population of
448 million and a nominal GDP (2020) of $17.1 trillion.
(For comparison, the United States’ nominal 2020 GDP
was $20.5 trillion, and China’s was $14.9 trillion). This
may also contribute to compensating for the loss of the
“peace dividend,” which resulted from historically low
military expenditures in Europe. The European Union—
and especially Germany—will also have to undergo major
adjustments with regard to their current business model,
which is heavily oriented toward export surpluses. China
has already started such a reorientation toward less dependency from international markets. This will come with
economic costs in the form of lower growth rates. But it
is in line with the worldwide trend of emphasizing resilience, even at the expense of lower short-term efficiency.
All in all, in my view the world after Ukraine will not
be a world of bifurcation or of a return to Pax Americana,
but rather a world of overlapping regional coalitions.
Hopefully, in the long run such a world could also include
a reformed, less nationalistic, and more democratic Russia
and China.
<<<<<<>>>>>>
Putin has in fact
already revitalized
both the European
Union and NATO,
and will do the same
for the principle of
multilateralism.
HAROLD JAMES
Professor of History and International Affairs,
Princeton University, and co-author of The Euro and
the Battle of Ideas (2016)
I find the bifurcation or competing blocs or deglobalization
or end of globalization thesis (there are many competing
variants) less and less probable as time goes on. In part,
this is because of a centuries-old pattern: supply shocks
have historically produced calls for more trade, more cooperation, and new institutional ways of managing recovery.
There is also the politics of this particular challenge to
globalization. Russian President Vladimir Putin may well
have thought that a quick, overwhelmingly powerful, and
successful action to bring Ukraine in line and change its
government would win plaudits in China and appear as a
neat balancing to American pretenses of unilateralism.
But instead of a brilliant but brutal surgical strike, Russia
mounted a spectacularly brutal and mismanaged war. The
appalling extent of civilian casualties in Ukraine, the degradation of the Russian army, the threat of widespread nuclear
contamination from the dangerous mishandling of reactors,
if not from nuclear warfare: these are all so appalling as to
have turned Russia into an international pariah.
The consequence of the bungled war also presents a
grave test of China’s continued commitment to a close relationship with Moscow. Putin and President Xi Jinping
proclaimed themselves to be “best friends” in 2019, and
earlier this year at the Winter Olympics in Beijing, they
announced that that friendship had “no limits.” Well, now
those limits are being severely tested.
What lessons may be drawn from the experience of
an aging and probably sick man in complete control of the
levers of power? A well-known problem of autocracy is
that advisers are reluctant to give honest truths or opinions
to the autocrat, and that as a result decisions are flawed. At
a moment when China’s previously successful no-Covid
policy is being strained by mass outbreaks of disease in
Shanghai and now Beijing, and when Chinese growth is
faltering, any hints of a Putin-Xi analogy would be a gift
to critics of Xi.
The most likely result of the conflict then seems to me
a return to a recognition that multilateralism brings substantial benefits, and that even autocrats need to be open
to ideas and open to the world. Putin is the anti-globalist,
the ideologue who sees only a zero-sum game behind globalization. He will go down in history—like the great dictators of the twentieth century—as an excoriated figure,
whose doctrines are reviled, and whose leadership offers
only a negative model, a pattern for how not to behave and
how not to be successful. Putin has in fact already revitalized both the European Union and NATO, and will do the
same for the principle of multilateralism.
But the new order cannot simply be a Pax Americana
version of multilateralism. That is why U.S. Treasury
Secretary Janet Yellen’s recent striking speech reflecting
on China’s ambiguous response to Russian aggression,
and then calling for “friend-shoring,” may have been a
mistake. Trying to identify friends will always be a deeply
problematical exercise. But it would be unwise, and costly, to let votes in the United Nations General Assembly
influence the future direction of trade. Trading-withthe-enemy legislation makes sense in all-out conflict. In or carbon dioxide emissions that move across borders and
between continents—there are no enemies, but necessary
partners. The same is true for the global threat of hunger
that has been the terrifying outcome of Russia’s actions.
Friend-shoring won’t feed people: and it is likely to make
many, many enemies. 

<<<<<<>>>>>>
Globalization’s future
is more in doubt than
at any time in the
twenty-first century.
ATMAN TRIVEDI
Senior Vice President, Albright Stonebridge Group
F
or many world leaders, Russia’s brutal invasion of
Ukraine harkens back to a dark and violent bygone
era of international politics. Propelled by a reenergized transatlantic partnership that just recently had appeared adrift, the West has mounted a swift response to
support Ukraine and also weaken Russia’s capacity to assault its neighbors. The war may be in its early stages, but
American leadership and European resolve, together with
the United Kingdom, Japan, and other Pacific allies have
so far shown democracies can stand together to defend international order.
Ukraine’s future is uncertain and may well end in
stalemate. Yet the war’s initial phases have injected confidence into the West’s diplomacy after an underwhelming response to Covid-19, a disorderly endgame in
Afghanistan, and the tumult unleashed by Trumpism and
Brexit. The swift, ongoing implementation of biting transatlantic sanctions and U.S. efforts to freeze Russia’s foreign reserves point to a broad recognition that “this time
is different.” Putin’s aggression has also accelerated calls
for more “friend-shoring” and/or “near-shoring” of supply
chains among democratic allies. The war is likely to continue a trend in which global politics trumps economics,
and national self-sufficiency is the coin of the realm.
While the West has been galvanized by Russian revanchism, the war has also brought China and its junior
partner Russia closer together—an unwelcome trend that
predated the invasion—and attracted autocracies like North
Korea, Syria, and Venezuela. On frontier technologies with
potential strategic and military applications, the war is accelerating growing mistrust between the West and the RussiaChina entente, producing further economic separation.
At the same time, a third international camp composed of swing states—most prominent among them
India, but also including significant powers such as Brazil,
Indonesia, and South Africa—has emerged. These democracies prefer to stay essentially neutral on the war and
hedge their bets.
India’s calculus is unique among the non-aligned.
China’s territorial ambitions in the high Himalayas have
lent urgency to India’s tilt towards the United States on
security matters. But it is that same preoccupation with its
larger, more powerful neighbor that is driving New Delhi to
undertake a delicate balancing act intended to keep Russia
on side without fraying ties on either side of the Atlantic.
The machinations of this third grouping, China’s influence over international politics despite a stalling economy, and, most importantly, the continuing political polarization within the United States all suggest a return to Pax
Americana isn’t likely. But at this moment, the West appears poised to come out in better shape, with Russia weakened and isolated, and China’s awkward embrace of Putin
hardening U.S. and now European skepticism about Xi
Jinping’s rule. Germany’s shock at Russia’s land grab has
contributed to Berlin’s growing doubts about China. The
ongoing technological and economic competition between
the United States and China will only intensify—expect
Brussels’ views to grow more aligned with Washington’s
because of the war. Beijing has been orienting its economic policymaking in preparation for decoupling but may not
have anticipated the war’s role as an accelerant.
Western sanctions and export controls have raised
questions about a shift towards separate financial, trade,
or currency systems by powers looking to insulate themselves from outside pressure. But the combined strength
of the U.S., European/British, Japanese, and allied Pacific
economies (about 60 percent of global GDP) make such
tectonic shifts improbable over the near term. The dollar
still represents the global reserve currency, followed by
the euro—and things should remain that way for the foreseeable future.
The world after Ukraine will be marked by continuing uncertainty, in no small measure because the war’s
duration, scope, and ultimate outcome are far from predetermined. Emerging economies face acute financial
pressures in the near term as supply chains convulse and
prices spiral; more of them will likely follow debt-ridden
Sri Lanka’s lead. More broadly, conditions could be ripening for a global economic downturn or even crisis. The
U.S., European, and Chinese economies are all exhibiting
varying degrees of fragility.
Against this backdrop of intensifying major power
competition and strong nationalist, populist, and economic headwinds, globalization’s future is more in doubt than at
any time in the twenty-first century. 
<<<<<<>>>>>>
Russia’s likely defeat
in Ukraine will
probably lead to a
reinforced Western
military and a new
Pax Americana.
ANDERS ÅSLUND
Senior Fellow, Stockholm Free World Forum,
and author, Russia’s Crony Capitalism: The Path from
Market Economy to Kleptocracy (2019)
Russian President Vladimir Putin’s war of aggression
against Ukraine has been a wake-up call for the
West. The collective West has come together as never before. In particular, this is true of the European Union,
but also of countries such as Japan and South Korea.
Suddenly, Europeans realized that Putin’s Russia posed a
real threat to their national security, compelling them to
act together and enhance their defense expenditure. This
occurs after Freedom House has recorded a steady decline
in democracy since 2006. U.S. President Joe Biden has
perceptively caught on to this important issue by calling
for new democracy building through his democracy summits and scolding international corruption.
While the West is coming together, the developing
world is split over a broad spectrum. It has been illuminated by the votes in the United Nations General Assembly
on Russia’s aggression against Ukraine and on Russia’s
ouster from the U.N. Human Rights Council. Some democratic developing countries side with the democratic West;
a score of hard-core dictatorships side with Russia, while
most are neutral. The developing countries are all over the
map. China does not want to be captured by Putin’s mad
policies, while India does not want to be forced to turn
against Russia.
Rather than a bifurcation of the world, the effect of
Russia’s aggression against Ukraine appears to be that the
Western world comes together around common values and
fears, while the developing countries are going in multiple
directions and are becoming more split and disoriented. A
decade ago, the not very democratic BRICS appeared to
represent a leading light, but currently none of them inspires. China’s growth has declined, and its repression and
state control have become worse. India is losing its democratic luster and has stayed very poor. South Africa and
Brazil are stagnant economies with uninspiring politics,
while Russia is a sheer disaster. While China was a leader
of the developing world, it no longer appears to carry its
laurels. Russia’s likely defeat in Ukraine will probably lead
to a reinforced Western military and a new Pax Americana.
Thus, the West is likely to gain power and influence. It
should take the lead and reform the international organizations so that they promote democracy and the rule of law,
while kicking out violators of all international law, such
as Putin’s Russia. Russia’s vetoes and unlimited lying in
the U.N. Security Council have exhausted its right to hold
such a seat. Under the leadership of the United States, the
democratic countries should set up a new Community of
(real) Democracies, in line with late Secretary of State
Madeleine Albright’s excellent initiative. In parallel, a
new international organization for the building of the rule
of law should be set up. The democratic countries need to
utilize their newly won consensus and initiative.
<<<<<<>>>>>>
We should put aside
Biden’s vision of an
inexorable struggle
between democracies
and autocracies, and
focus instead on pressing
common challenges.
JEFFREY D. SACHS
University Professor and Director of the Center for
Sustainable Development, Columbia University
While we can’t predict the future, we can state the
future we’d like to see. For my part, I would
greatly prefer a quick negotiated end to the conflict based on Ukrainian neutrality, an end to NATO enlargement, practical solutions for other outstanding issues
(for example, implementation of the Minsk II terms for
the Donbas), and Russia’s complete military withdrawal from Ukraine. Russia would direct some of its frozen
reserves into a Ukraine rebuilding fund, and the United
States and Europe would recycle some of their new SDR
holdings for this purpose. The sanctions on Russia would
be rolled back on a timeline consistent with the implementation of the peace accords.
With the war ended, we would try to rebuild an international order based on the United Nations Charter, the 
SPRING 2022 THE INTERNATIONAL ECONOMY 25
Universal Declaration of Human Rights, a reform of global finance to direct more flows to developing countries
and towards the energy transition, and a real attempt to
surmount the escalating geopolitical tensions. We would
put aside Biden’s vision of an inexorable struggle between
democracies and autocracies, and focus instead on pressing common challenges facing all nations: the pandemic,
climate change, global supply chains and regional security, nuclear disarmament, and many others. Our common
interests can and should take priority over our differences.
As President Kennedy famously said, “And if we cannot
end now our differences, at least we can help make the
world safe for diversity.”
<<<<<<>>>>>>
Putin’s attack
should galvanize real
foreign policy, defense
policy, and industrial
policy cooperation
among democratic,
allied nations.
ROBERT D. ATKINSON
President, Information Technology and Innovation
Foundation
When considering the impact of Putin’s aggression
on globalization and alliances, there is the ought
issue of what should happen, and the will be issue
of what is likely to happen. Unfortunately, I don’t believe
they are aligned.
The ought is a world in which democratic, rule-oflaw nations, especially those in the European Union, finally accept the reality that the world is not moving to
an “end of history,” “no two countries with McDonald’s
restaurants will go to war” world, and that countries have
to pick sides. This would mean no more countries wanting
their cake and eating it too: relying on the United States to
defend their national security interests but opposing U.S.
efforts fight against China’s rampant innovation mercantilism and, in the case of the European Union, enacting policies that discriminate against U.S. technology companies.
Rather, Putin’s attack should galvanize real foreign
policy, defense policy, and industrial policy cooperation
among democratic, allied nations. This would mean U.S.
allies ending their free riding on U.S. military capabilities
and increasing their own defense spending, engaging in
real cooperation on advanced technology development,
and most importantly, cooperating to limit the benefits
China achieves from its innovation mercantilist policies.
The reality is that while this scenario should happen,
the odds of it coming to fruition are challenging. It is not at
all clear that nations/regions like Europe, South Korea, and
India will view the world all that much differently, assuming that the Russian aggression ends with the pre-status quo
being mostly restored and China does not invade Taiwan.
While the current consensus around Russia is likely to hold,
it’s not at all clear that this consensus will extend to China.
The incentive for these nations to continue to freeride on America, or at minimum, to not choose a side,
is quite high. When EU policymakers continue to see
American technology companies as the biggest threat to
the EU economy, at a time when the European Union runs
a massive trade surplus with the United States, suggests
that the European Union is likely not to view Russian aggression in system-redefining terms. This is particularly
true for Germany, which exports more than $100 billion
to China annually and sees the China market as key for a
number of their important industries, including autos and
chemicals. China’s carrots and sticks will only increase,
as will its willingness to use them to enforce either subservience or neutrality. So will leading democratic allied
nations agree to cooperate and ban Chinese imports of
goods based on intellectual property theft and/or massive
subsidization? Will they agree to collectively impose appropriate export controls on technology? Will they stop
penalizing U.S. companies and instead turn their focus on
China? We can hope that the answers to these questions
are in the affirmative, but I fear that is wishful thinking
<<<<<<>>>>>>
It is time to chart
a path to a new
multilateralism.
MOHAMED A. EL-ERIAN
President, Queens’ College, Cambridge University, and
Professor, Wharton School, University of Pennsylvania
E
conomic and financial globalization is changing—
away from ever-closer and more efficient cross border links supported by rule-based multilateralism
and toward greater fragmentation and adhocracy. The 
26 THE INTERNATIONAL ECONOMY SPRING 2022
result is an even more uncertain global economy and
greater inequality.
The are several drivers for this ongoing regime shift.
Most of them, including greater geopolitical tensions and
growing economic protectionism, were present before
Russia’s invasion of Ukraine, and have now been turbocharged by it.
Cross-border supply chains have become more fragile,
disrupted, and disruptive. The sanctioning by governments
of trade and individuals has been accompanied by major
restrictions on international payments and settlement.
The private sector is also playing a role in driving this
regime change, from the greater emphasis on resilience
(versus just-in-time efficiency) to the self-sanctioning
commercial activities.
All this has exposed long-standing structural weaknesses in the multilateral system at a time when its ability to respond and to facilitate global policy coordination
are undermined by profound disagreements and mistrust
among country shareholders.
Left to its own devices, this combination of factors
would solve to the least favorable common denominator.
In addition to a stagflationary impetus, it would serve as
yet another unequalizer, both within and across countries.
Rather than try to revert to a status quo ante that
is no longer feasible, it is time to chart a path to a new
multilateralism.