JSIS 201 Week 10 Notes
JSIS 201 Week 10 Notes JSIS 201
Popular in The Making of the 21st Century
Popular in International Studies
This 7 page Class Notes was uploaded by Rachel Pollard on Friday March 11, 2016. The Class Notes belongs to JSIS 201 at University of Washington taught by Bachman, David in Winter 2016. Since its upload, it has received 26 views. For similar materials see The Making of the 21st Century in International Studies at University of Washington.
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Date Created: 03/11/16
Other Consequences • Determination by others to develop nuclear weapons as insurance policies (NK, Iran, Syria, but Liby ) o Encouragement of quicker development of nuclear weapons o Secret development of weapons o Axis of Evil may have only reinforced some decisions • Rise of China o Joined the World Trade Organization in 2001 o 2011: Second largest trading nation in the world o They were pursuing a foreign policy of "win -win" diplomacy • Opportunism by others, lack of attention by the US o Made it possible for them to "sign - on" to regain (Pakistan) extensive US aid o US was so focused on the War on Terror • Bush tax cuts, lack of regula tion --> financial crisis, national debt doubles in Bush years. o Budget surplus in 2002 • So he cut taxes o After the 9/11 attacks, the US went into a short recession o The US couldn't reverse the tax cuts because it was necessary to stimulate the economy o The Bush Administration refused to recognize how much the Iraq and Afghanistan Wars would cost. • No sense of how much this war would cost o The tax cuts, the lack of war funds, meant that the national debt greatly increased. o This weakened the US global financial pos ition • Arab Spring o There's a connection between the US involvement in the Middle East and the Arab Spring. o Emerged in late 2010. o Contagion effect o Democratic regimes didn't form The Global Financial Crisis Monday, March 7, 2016 2:49 PM The Crisis Explained • Washington Mutual Sources of the Crisis • Economic imbalances in one place have effects in others. • Crisis results from three interrelated factors/ developments (because of globalization): o Asia (never again after the Asian Financial Crisis) • Won't be vulnerable to another financial crisis o US (long-term deregulation, new financial "innovations." budget deficits, high levels of consumer debt, high proportion of economy based on consumption). • Budget deficits grew due to the war • Debt grew rapidly. • Most of the US economy was based on consumption § This is highest in international respects o Europe (single currency, national finances, bad choices by national governments). • Euro created in 1999. • Didn't create a unified a budget • The Greek government ran a perpetual budget deficit § They kept running government bonds Asia • Lessons of 1997-1998 Asian Financial Crisis o Never be vulnerable to short term capital outflows o To avoid vulnerability, run a trade surplus and have large foreign exchange reserves (also results from high domestic savings and relatively low levels of domestic consumption --> especially in China). o China takes off, but wants to keep currency from appreciating in value --> "sterilizing foreign exchange" o To avoid inflation, the Chinese would turn their export dollars over to the Chinese Central Bank who would then give them the Chinese Foreign Currency. • The Chinese government accumulated huge foreign exchange reserves The United States • Deregulation in the US, belief in market fundamentalism • Consumption driven economy, low savings, large trade deficits. • New financial instruments almost no one understands • US growth, but increasingly concentrated; middle class borrowing o Increasingly, wealth is concentrated in the top one percent, or twenty percent. o Stagnate wealth o Growing inequality. o The Middle Class was able to sustain the style of living, often associated with the middle class, by heavy borrowing and the cheap purchase of goods from China. • Big budget deficits (US has to borrow) • US advantages of size, use of dollar - good place for Asians to park their money • Generally fairly low rates of returns on traditional investments - stocks and bonds • Money increasingly channeled into housing s ector- creation of housing bubble o New financial innovations were based on the housing market and mortgages. • Shady practices in mortgage lending. Europe • National economies, regional currency mismatch o People believed the EU would be able to bail them out • Growing indebtedness in parts of Europe o Greece and Italy are growing in debt o Lots of consumer and government debt • All of which required loans and borrowing • Deregulation, competition o Ireland: deregulation of markets o Lots of banks competing for lenders • Creation of real estate bubbles in Ireland, UK, lesser extent, Spain o People wanting to buy property o When the bubble pops, the exotic investments go into big declines. o People lose lots of money. Governmental Actions • US - bailout the banks, (Targeted Asset Relief Program- Bush Administration), Take -over of AIG (Bush) Chrysler and GM (Obama). o Short-term bailout programs o US Banks were saved o President Obama launched a stimulus program • Europe - takeover of banks in many places • Creation of G-20 to try to coordinate responses of 20 largest economies of the world o They were to meet every 6 months to coordinate economic strategies • Government stimulus programs in most places for a year and a half - but makes debt situation worse. • Moves to increase regulatory power in most places. But, Limited Success • Limited and slow recovery in the United States, now non -trivially above 2008 GDP figure, but UK and many others are not, or just getting there. • Jobless recovery until about second ha lf of 2013 o It generated very many new jobs in order to take care of the unemployment rate. • Rapidly growing national (sovereign) debt o As the US continues to grow, they should continue to borrow. o A balanced budget doesn't reduce the debt, it just doesn't all ow the debt to grow. o Reduce spending and raising taxes are the two ways to get rid of debt. • Need for economic rebalancing (US, China) o China has to consume more of its production internally. o US needs to lower their consumer rates. o Limited progress and a fundamental rebalancing has not yet taken place. • Limits of G-20 o Expanding government spending. • Housing, commercial real estate overhang. • Rising oil prices (also food) (China, India rise, Iran sanctions, Arab Spring), then falling commodity price--> ter • Political Polarization in US, elsewhere - inability to get things done. o Extreme polarization between political parties thus causing it very difficult to get things done • Housing bubble in China o China created its own housing bubble, one they still face today o Leading people in Hong Kong who follow the Chinese economy to say that Chinese economic growth is about half of what the Chinese government said it was. • Europe (and US to an extent) emphasize austerity, not Keynesianism o Limiting debt seems to be a major drag on the system as well. o As a result of the crisis, there is little rapid improvement in the economy. The Global Economy in 2016 • Global deflation. o Effects on consumer psychology, wages o Effects on financial markets • Slow global growth, especially in Europe and Japan • Debt problem is worse o US is the healthiest of major global economies at this time. • Inequality is worse o Trying to buy a house in Seattle, an average income wouldn't allow one to afford to buy a house. • The rise of the angry voters and th eir political spokespersons. • Focused on the developed world. It reflects the consequences of the kind of concurrent resolution of the international trilemma. With free flowing capital, issues like the Global Financial Crisis are magnified. Exacerbation of debt problems. They illustrate the power of the large firm. Order and Disorder in 2016 Wednesday, March 9, 2016 3:03 PM Sources of Challenge to a World Order • Success --> China o Maybe India • Failure --> failed states • Rejection of the order --> ISIS, Taliban, North Korea • New or emerging issues --> Global Warming, new diseases, global inequalities • The costs of maintaining the order become too expensive for the dominant power(s) --> both a political and economic question o Are the perceived benefits greater than the cost? o A political and economic decision o If too many resources are going into this… How Does Success Challenge the Order? • Does the successful (rising) power see the order as legitimate? • Does it identify with the order? • Does it free ride (is it a "responsible stakeholder")? o If it free rides, does its lack of participation greatly raise the costs of system maintenance to the leading power and others? o China, partner with US in defining and dominating the world order? • Has it developed enough power (in multiple dimensions) to block change within the order? o In the UN, IMF and World Bank, there's weighted voting systems. o WTO: one country, one vote • Able to build coalitions • It's hard to imagine globalization and world trade can take place in this c ontext o Has China created enough power to block change within the order? • China can build a coalition in the UN or in other contexts. • Has it developed enough power to raise new demands within the order? o Those demands, likely, won't becoming part of the international order anytime soon. Many of China's demands are a reversion of older state sovereignty. o China now has several countries that would agree with it in several areas of world order decisions. • Does it have enough power to ex empt itself from the norms of the order? o Human rights, Internet freedom, etc. China does have that power. o China does not have that power to replace the United States. How Does Failure (Failing) Challenge the Order? • (Fragile State Index) Very High Alert 6 4 million people (4 countries) o Very high alert doesn't include Iraq, Syria, Iran… o High alert (partial, top 11 countries 630 million) • Consequences of Failure o Difficulty in rebuilding authority (long -term use) • If authority fails, the record of building up nations after state failure, takes a long time to be reconstituted. • China in 1911, was a failed state. It took 38 years for a new state to be reconstituted.` o Statelessness --> armed militias, terrorist groups, civil war, etc. o Refugees and migration (spillove r effects on neighbor states) o Immense human tragedy • Impacts on Order o How much can the order manage? o Nuclear weapons states o War o Refugee Flows o Environmental Impacts • No one's there to prevent the exploitation of raw materials How Does Rejection Challenge the Order? • Examples: ISIS, Boko Haram, Al Shabob, Al -Qaeda, North Korea • Fundamental refusal to play by global norms • In NK case, dangers of proliferation • Rejection of order by some may inspire others, promotes terrorism other acts of violence (mim icry) • Spillover effects o On neighboring states • Destabilization of weak or fragile states. • Environmental impacts. How Do Emerging or New Issues Challenge the Order? • Examples: Climate Change, New Contagious Diseases • Apportioning the costs of prevention, pre paration, adaptation. o What's fair with climate change measures? • New contagious diseases --> Impacts on international travel, trade (do you close off international movement of peoples and goods to prevent transmissions?) o Zika Virus • Capturing benefits (?). T he melting Artic Ocean - issues of who controls, gains most benefits. • Impacts probably greatest on poorest, weakest states. Again, spillovers influencing fragility of states. How Do the Costs of Maintaining the Order Challenge the Order? • Costs outweigh the Gains --> both economic and political impacts o Globalization and Donald Trump and Bernie Sanders: Aspects of the order aren't working for the US (Inequality and the consequences to industry, people without higher education; slow income gr owth for many). o Gains less tangible, costs apparent. o Growing unwillingness to pay for a military that is more than adequate to protect the US, but needs to be much larger to cope with maintenance of the order. (And political polarization over this issue Unwillingness of enough Americans, with the right skill sets to join the military (?) o Some tasks may be beyond control or ability, at almost any price --> nation building. o Privacy/security trade-offs (Apple vs. FBI). Are national values challenged by glob al requirements? • Whether the practices that are required to be a global leader are compatable with the values we have at home. What is to be Done? Friday, March 11, 2016 2:50 PM Some Broad Lessons from the Making of the 21st Century • A Dynamic World (China's position in 1914 vs. Today) • Accelerating Technological Change o Tools that we use today are very different from ones that existed earlier. • Centrality of Power (various kinds) and the nature of its concentration/diffusion o Economic power plays an important in the making of the twenty-first century. o Theme: how power works in different ways in different countries. • Growing interconnectedness of peoples, ideas, trends, countries, companies, etc. • Growing concerns about how our voices are heard, how resp onsive institutions are to us. o Easy to express things that we feel, via social media o The speed of communication and the slowness of how fundamental institutions respond is becoming an issue • Violence and conflict still all too common. 2016 vs. 1914 • World Order assessed on the basis of predictability, legitimacy and enforcement. Is world order stronger/better today than 100 years ago? • If it is, is it good enough? If it isn't what are we going to do about it? • If it isn't, what then? What are we going to do about it? From the Making of the 21st Century to You • JSIS 201 was a very macro perspective. • Rationalistic, usually top down, focus on broad processes, structures, and leaders. • How does the course relate to your lives? • How is world order connected to you? Connections: You and 201 • Structures o You are embedded in various structures and systems (Global Capitalism, "Global Order," US liberal democracy, the University of Washington, etc.) o These systems embody certain values and contain incentives (rewards and punishments) that are thought to reflect those values. o You try to navigate these systems to your advantage (exercise agency - "take charge of your life" - respond to incentives, or try to alter the structures to y our advantage). Some will do better at this than others. • The system doesn't always work for everyone. • There's no absolute human equality in the system other than birth and death. • This is highly individualistic, and a rationalistic view. Is That All? • What if the system(s) are unfair, unjust? o Human beings can always adjust to all forms of governments. • How do we build collective action? o We have to work collectively to bring about change. o Collective action problem • How do we build coalitions? • W is the passion and emotion in this? o Direct impact • What happens when you run into the unacceptable? (What enables you to see something as unacceptable?) • Values - Identity Concerns • Thus, the concern of what is to be done Origins of What Is to Be Done • Marx These on Feuerbach o Philosophers have only explained the world, the point is to change it. o Theme: how to change the world • Russian Authors: Nikolai Chernyshevsky, Leo Tolstoy • Lenin • Issue of unpleasant, undesirable, and unacceptable present and what to d o about it -How (what) vs. why. Values and Actions • Values and identity give us meaning - who we are, what we stand for, what we believe in, and inform how we act. • But how do we make these values real - put them into practice, make the world move into gre ater conformance to our values. • We don't all share the same values - sometimes we adamantly (and violently) disagree on values. o Values are not uniform or universal. • Few people set out to change the world, and a tiny percentage of them succeed. And often th ey may not make the world a better place (Lenin). • Some by ordinary/extraordinary acts some dramatically crystalize social developments that they unexpectedly change the world. o Rose Parks • A catalyzing event for the American Civil Rights movement o Mohamed Bouazizi • Self-immolation in Tunisia at the beginning of the Arab Spring. • Many (most?) elements of changing the world in the 21st century will come from the bottom up, by our individual and collective actions. These may not be glorious acts, widely noted and c ommemorated, but… Conclusion of Middlemarch by George Eliot.