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March 30, 2012

Authoritarian Capitalism Versus Democracy


“America is a power, Europe is an experience”
— Joschka Fischer

In 2002 robert kagan, a leading neoconservative intellectual temporarily “exiled” in Brussels, wrote a brilliant essay, “Power and Weakness,” arguing that the political personality of European power as we know it today is the product of America’s Cold War policies and the universalization of Europe’s post-World War II political experience. But more than anything else, it is the product of Europe’s current military weakness.

In his analysis, post-9/11 America should naturally have cooperated with Europe, but Washington could not rely on the European Union as a strategic partner in managing the world because “on the all-important question of power — the efficacy of power, the morality of power, the desirability of power — American and European perspectives are diverging.”

A decade later American and European perspectives diverge on the all-important question of the decline of Western power. While American elites view the very discussion of “decline” as “pre-emptive superpower suicide,” Europeans are busy learning how to live in a world where the eu is not a leading actor and the European continent is not the center of the world but simply the wealthiest province.

Could it be that the clash between Washington’s denial of the very possibility of America’s decline and Europe’s excessive readiness to adjust to it can damage the Western alliance more than the controversy over the use of power did? Could it be that at the heart of the current troubles in the transatlantic relationship is a crisis of the political imagination of the West?

I want to argue that the paradox of the new world order emerging out of the ongoing recession is that the global spread of democracy and capitalism, instead of signaling “the end of history,” marked “the end of the West” as a political actor constructed in the days of the Cold War. In the decades to come the nature of the political regimes will be an unreliable predictor for the geopolitical alliances to emerge; and it is the blurring borders between democracies and authoritarian capitalism, rather than the triumph of democracy or the resurgence of authoritarianism, that defines the global political landscape.

Kagan’s “Long Telegram”

In “power and weakness” Robert Kagan eschewed political correctness, insisting that after the end of the Cold War Americans and Europeans no longer shared a common view of the world. They no longer shared a common strategic culture. The divergence between America and Europe can be best explained not by differences in “national character” or value systems but by the asymmetry of power. It is Europe’s relative military weakness that determines Europeans’ rejection of power as an instrument in international relations. And it is America’s strength that defines Americans’ readiness to use military power. In short, capabilities shape intentions. Forced to choose between increasing their military budgets and becoming second-rate powers, Europeans most likely will choose marginality.

Contrary to the opinion of its critics, Kagan’s essay was not a dismissal of the eu’s relevance in the world. Paradoxically Kagan’s dispatch from Brussels was reaffirmation of the importance of the transatlantic alliance. Arguing with the prevailing consensus in Washington at the time, he asserted that it was true that Europe had lost its geostrategic and military significance for the U.S. But Europe had retained its critical ideological relevance for the American foreign policy, he believed, because the split between America and Europe meant the end of the post-Cold War world. And in Kagan’s strategic vision it is the post-Cold War world — a world without Soviet power but defined by the ideological confrontation between free nations and tyrannical regimes — that best suits American interests.

Re-reading Kagan’s article a decade later, we face three critical questions. Was Kagan right to expect that even a further decline of the eu’s influence in global politics, even a threat to the very survival of the eu, would not force Europe to invest in its military credibility? Was he right to expect that America’s political, economic, and military dominance in global politics would be sustainable in the medium- and long-term? And was he right to believe that the new world order would be structured along the lines of the Cold War confrontation between democracies and autocracies?

The eu as a retired power

In his novel Death with Interruptions, Nobel Prize–winning writer José Saramago imagines a world where people will live so long that death will lose its central role in human life. At first, people are gripped by euphoria. But soon, “awkwardness” of various kinds — metaphysical, political, and practical — starts to reenter their world. The Catholic Church realizes that “without death there is no resurrection, and without resurrection there is no church.” For insurance companies, life without death also means oblivion. The state faces the impossible task of paying pensions forever. Families with elderly and infirm relatives understand that only death saves them from an eternity of attentive care. A mafia-style cabal emerges to smuggle old and sick people to neighboring countries to die (death is still an option there). The prime minister warns the monarch: “If we don’t start dying again, we have no future.”

The challenges Europe faces today in many ways resemble the metaphysical dilemmas the citizens of Saramago’s “no death” utopian kingdom struggle with. Europe is still the best place to live, but it is not any more a good place to dream. What makes Europe a success is at the same time what threatens Europe — the welfare state; the multilayered model of eu governance. The current crisis forced Europe to re-perceive the world, but in a paradoxical way it only reinforces Europe’s shift away from military power. Today fear is Europe’s “dominant color,” but Europeans do not worry about being occupied or militarily defeated. What they fear is economic insecurity and a loss of their way of life.

A study by the European Council on Foreign Relations, conducted in 2011, found that both the eu’s security elites and the European public take peace for granted. They increasingly look at security through the eyes of insurance companies rather than military planners. While the crisis pushed emerging powers like China and India to increase their military spending, in Europe defense budgets were the first to be cut. nato’s military intervention in Libya initiated by the French President Nicolas Sarkozy and the British Prime Minister David Cameron, while meant to demonstrate Europe’s relevance as a military power, ended up confirming the fears that the European Union neither is ready nor has the capability to assert itself as a military power. The Europeans did not succeed in acting together; the performance of the European military units engaged in the operation revealed a dangerous dependence on America’s intelligence and logistics; and the European publics, while supportive in the beginning, very soon lost their appetite for the intervention.

Nobody has better captured the new situation than the former U.S. Secretary of Defense Robert Gates, who, echoing Robert Kagan, in a February 2011 speech at the National Defense University, expressed his fear that the “demilitarization of Europe — where large swaths of the general public and political class are averse to military force and the risks that go with it — has gone from a blessing in the 20th century to an impediment to achieving real security and lasting peace in the 21st.”

The unfolding of the post–Cold War world order has made Europeans nervous and anxious about the future.

The unfolding of the post–Cold War world order has made Europeans nervous and anxious about the future. But what the crisis has revealed is Europeans’ strong tendency to translate security problems into economic and social issues that can be dealt with by regulation, criminal justice, or technology rather than classical foreign and military policies.

Reflecting on the self-destruction of the pre-1914 liberal Europe, the Viennese writer Stefan Zweig was convinced that the outbreak of World War I “had nothing to do with ideas and hardly even with frontiers.” The catastrophe should be explained by “the surplus force, a tragic consequence of the internal dynamism that had accumulated in forty years of peace and now sought violent release.”

After 70 years of peace, today’s Europe is not immune to the danger of violent outbursts. But it is not the surplus of energy (economic, political, cultural) but the deficit of energy that threatens Europe today. The risk-averse nature of the eu as an international player has its demographic explanation. Europe is aging and shrinking. The data projections tell us that the median age in Europe will increase to 52.3 years in 2050 from 37.7 years in 2003, while the median age for Americans in 2050 will be only 35.4 years. Europe’s share of global gdp is thus liable to shrink in the decades to come. Faced with the choice to either open the borders of Europe to immigrants, and thus preserve their standards of living, or close the borders and suffer economic declines, Europeans have decided to simply reject the political class that articulates this choice. In short, Europe is at a point where the demographic imagination defeats the democratic one. Europeans do not aspire any more to change other societies; they are preoccupied with the fear that others are trying to change them through immigration or economic pressure.

A decade after the European-American clash over Washington’s military intervention in Iraq, Europeans are still proud of their position of nonintervention, but they have had second thoughts about the virtues of a multipolar world. If a decade ago Europeans were convinced that what the world needs in order to become a better place is a more European-minded America, they are not sure any more. America at last has a European-minded president, but Barack Obama did not succeed in solving the Israeli-Palestinian conflict, he did not succeed in getting Iran off the nuclear path, and he did not succeed in changing Russia’s political behavior. What Obama succeeded in doing is starting America’s withdrawal from Europe. It turned out that being European-minded is not the same as being interested in Europe.

It was America’s global hegemony that enabled the EU to emerge on the world stage as an attractive power in the first place.

What many of the European critics of American power have discovered is that a world order built on seemingly unassailable American power was the one most hospitable to the European project. It was America’s global hegemony that enabled the European Union to emerge on the world stage as an attractive power in the first place. American hegemony made room for the European Union to experiment with being an unconventional, non-nation-state actor and freed it to concentrate on its internal scope and institutional architecture. America’s security umbrella, not least, allowed the European Union to become a global power without needing to become a military one. But while Europeans are nostalgic for the American world of yesterday, they do not believe that this is the world of tomorrow. Europeans have also lost their conviction that the eu is the governance model for the world to come.

A decade ago, European public opinion assumed that globalization would prompt the decline of states as key international actors and nationalism as a seminal political motivator. But what until just yesterday seemed universally applicable begins to look exceptional today. Even a passing glance at China, India, and Russia, not to speak of the vast reaches of the Muslim world, makes clear that both ethnic nationalism and religion are back as major ideological driving forces shaping global politics. Post-modernism, post-nationalism, and secularism are making Europe different from the rest of the world, not making the rest of the world more like Europe.

So, Europe is unhappy with the new reality but does not feel strong enough to change it. And Kagan was right a decade ago to predict that the eu’s relative weakness will end up in the narrowing of the European mind and will lead Europe away from engaging with global affairs. Only powerful nations can subscribe to a universalist agenda: This is the axiom of Kagan’s historically informed realism. The weakness comes together with parochialism.

Decline: A choice or a result of choices made?

A decade after “Power and Weakness,” Robert Kagan wrote another piece that captured the imagination of the American president. This time the president was not George W. Bush but Barack Obama, and the piece was not about Europe but about America. “Against the Myth of American Decline,” an essay published in the New Republic in February of this year, is Kagan’s argument with all those who believe in America’s decline. Looking back at history and interpreting the symptoms of America’s current malaise, Kagan is convinced that America is not in decline and that the fashion of declinism is rooted in analysts’ obsessions with trends at the expense of volumes, and in a nostalgic fallacy. Very much like Wall Street investors, most of the proponents of decline are preoccupied with leanings, so they tend to view the rising powers as stronger than and the United States as weaker than the situation warrants. But if analysts decide to look at volumes and not simply at trends, they will see that America has preserved its dominant position in military, political, and economic terms. Many people also view America as humiliatingly weak today because they have a very wrong impression of how strong it was yesterday. In reality, the United States was never as influential as some believe. And put in historical perspective, the current decline in America’s influence is less alarming compared with what happened to America’s power in 1970s.

What makes Kagan an optimist is his conviction that “the present world order — characterized by an unprecedented number of democratic nations; a greater global prosperity, even with the current global crisis, than the world has ever known; and a long peace among great powers — reflects American principles and preferences and was built and preserved by American power . . . If America’s power declines, this world order will decline with it.” In short, America is not in decline because the world cannot afford it. The very survival of the liberal international order is a proof of America’s strength.

It is true that the determinism of the pessimists who have already accepted America’s decline as inevitable is not much different from the determinism of the optimists who two decades ago endorsed the idea of the end of history. But while it is wrong to bet on America’s decline, it is fair to observe that nothing seems further from America in the 1990s than America today. In the past decade, America’s global influence has suffered substantial setbacks. America has experienced the limits of hard power and the erosion of soft power. The wars in Afghanistan and Iraq that were meant to be illustrations of American capacity to project power and reshape the reality on the ground have turned into illustrations of the limits of America’s capacity to make a difference. In the three-worlds universe of postmodern, modern, and pre-modern described by Robert Cooper in his book The Breaking of Nations, America experienced three different sets of constraints. In the postmodern world America does not have allies who are ready to share its ambition to manage history. In the world of modern nation-states America is constrained not by the risk-averse nature of her allies but by the growing military strength of her opponents. Nuclear proliferation is a fact and it will be more and more difficult for the U.S. to impose its will on hostile nuclear powers. And in the pre-modern world of failing states and tribal loyalties America experiences the unbearable lightness of nation-building. So, it is not that America has declined while others take top seat at the table; it is that on the field of global politics, America is not what it used to be.

America’s power is manifested not by capturing imaginations but by Washington’s ability to load its problems on others.

A decade ago, Washington’s power was best demonstrated by its capacity to shape the choices of others, making world politics look like a contest of who imitates America best — its economic model, educational institutions, and entertainment industry. Today America’s power is manifested not by its capacity to capture the imagination of others but by Washington’s capacity to load its problems on others. At present both Europe and America have mind-blowing debt problems, but while America succeeds in refinancing its debt on very favorable conditions, some of the Eurozone countries are forced to finance their debt at self-destructive interest rates. This is a painful demonstration of America being a power and Europe being not powerful enough.

So, decline is a choice but also the outcome of choices that were already made. The newly-found weakness of the U.S. is not only in the imagination of the declinists but in the erosion of America’s economic power, the declining social mobility in American society, and the citizens’ loss of trust in American institutions. The crisis that American society is going through is not unprecedented, but that doesn’t mean that this time it cannot end up differently. Kagan is right to argue that America cannot turn its back on the world and its problems, but it is also unrealistic to believe that America’s reputation will not be hurt by the way others view the performance of the American economic and political system. Falling in love with the idea that American power is in decline presents a clear and present danger for American society. But the denial of America’s visible loss of influence cannot be the alternative to decline.

Reflecting on the West’s experience in the last decade, it is fair to observe that if Europe fell victim to its tendency to think of military power only in moral terms, America fell victim to the trivialization of war. The post–Cold War military interventions (the Balkans being the paradigmatic case) created the expectation that American engagements with the world would bring maximum glory and minimum casualties. War has lost its meaning as an exceptional collective experience that reaffirms the identity of the nation. War lost its meaning of national sacrifice and the ultimate concentration of national energy. America has become used to what the Brits used to call military expeditions. War has been turned into professional sport.

Is it tomorrow yet?

In the days after the fall of the Berlin Wall, American political scientist Ken Jowitt observed that the end of communism is like a political volcano that in the beginning affects a circumscribed area but, depending on its force, eventually affects the entire globe. As Jowitt wrote in his book New World Disorder, we cannot expect “the ‘clearing away’ effect of the Leninist extinction to be self-contained, to be a political storm that considerately loses its force as if approaches Western and ‘Third World’ coasts.”

Kagan’s unwillingness to acknowledge the dramatic way in which the end of the Cold War has affected not only the East but also the West, how it has transformed both the liberal democratic regimes and the regimes of authoritarian capitalism, is the real source of vulnerability of his insightful analysis. In the current world of soft borders he tends to blur the border between the normative and the analytical, the border between what should happen and what is most likely to happen.

 Kagan envisions international liberal order as a post-Soviet world disciplined by the moral clarity of the Cold War ideological confrontation between freedom and tyranny and dominated by a single power: the United States. He believes in a world divided between the league of democracies and the axis of autocracies. But could the Cold War’s ideological frame be preserved in the world of global capitalism, where money, technologies, and ideas are changing hands every minute? In a world in which the sons and daughters of authoritarian leaders are studying and living in the West, in which the money of authoritarian governments is managed by Western bankers, in which American voting machines are most likely manufactured in China?

Between 1917 and 1989, ideologies replaced national passions at the center of world politics. But this very exceptional period ended with the collapse of the Soviet Union. The end of the Cold War was a blessing for the West because it left capitalism and democracy without an alternative, but it was also a curse because it forced the alternatives to democracy and capitalism to mutate (taking the forms of democratic or market institutions) and because it profoundly changed the relations between the elites and societies.

The Cold War was a time when the democratic West successfully dismantled the borders between social classes while strengthening and successfully defending the borders between the states — and in particular between free nations and communist dictatorships. In the days of the Cold War, political and business elites haunted by the specter of the communist takeover were actively cooperating with the society at large, exposing themselves to the constraints of democratic politics. In the past two decades, however, the reverse is the trend. The borders between states are gradually losing their importance while the borders between social classes have become much more difficult to cross. Globalization dramatically increased the number of middle-class people in the world, but it has eroded the foundations of the middle-class societies that were the distinctive feature of the Cold War West. Social inequality has increased in most Western democracies, and social mobility has declined.

The global emergence of a hovercraft elite, increasingly borderless and emotionally unrelated to their societies, is the fruit of a 30-year process that we might call “the movement for the liberation of the elites.” What distinguishes the new elites from previous generations of the rich and powerful is their lack of ideology and their escape from the restraints imposed by the nation-state. The social contract between rich and poor has been eroded by the ease with which the wealthy can stockpile their money beyond the redistributive power of the nation-state. But offshore tax shelters are only a symptom of a larger trend. The new global elites, elected as well as unelected, are less and less dependent on citizen-soldiers (because of volunteer armies using push-button weaponry), citizen-workers (because of outsourcing), and citizen-consumers (because of foreign purchasers of natural resources and high-tech products). And the declining capacity of citizen-voters to control politicians or hold their national elites accountable follows naturally from the declining influence of citizen-workers, citizen-soldiers, and citizen-consumers.

The experience of the past decade demonstrates that the natures of political regimes are not the best predictors of emerging geopolitical alliances. Newly emerging democratic powers like India and Brazil are very reluctant to make democracy promotion the center of their foreign policy decision-making. Old-fashioned ideas of national interest, but also postcolonial solidarities, seem much better predicators for the foreign policy rationale of the new democratic powers. In Europe in the days of the Cold War, foreign policy was kept out of electoral politics, while economic decision-making was at its heart. Now, European policymakers are trying to place economic decision-making outside of politics; what remains are the issues of identity and foreign policy.

So the world of tomorrow is unlikely to be disciplined by the Cold War corset. It is not only that the new democratic powers are unenthusiastic about making democracy promotion the defining feature of their international behavior, but also the fact that some of the recent democratic explosions in the world are likely to end with the establishment of illiberal and anti-Western regimes unattractive to American and European publics.

China is a rising global power, but China is not the ideological “other” Kagan hopes for. The citizens of the democratic West do not see the world of authoritarian capitalism as a threat similar to the Soviet one. The Soviet Union was not simply a nondemocratic power. It was a hostile political universe. It was a power with the ambition to conquer the world and to remake it in its own way. None of the current spoilers in international politics has this combination of ideological vision and military and political power. Most Americans and Europeans are repelled by the realities of the Chinese or Russian regimes, but they do not view them as threats to their way of life.

In a world of blurred borders and offshore elites, the rise of China does not necessary mean Chinese rules for the world. The return of “the world without meaning” makes it possible for the international liberal order to survive even if the West’s power declines (short of collapse) and the power of authoritarian capitalism is on a rise. What can make China different from the United States as a world leader is not so much American democracy vs. Chinese authoritarianism as the contrasting ways in which Americans and Chinese have experienced the world beyond their borders.

The spread of democracy and capitalism makes it more difficult if not impossible to build lasting value-based coalitions.

America is a nation of immigrants, but it is also a nation of people who never emigrate. Since the first Europeans settled there in the 17th century, people from around the world have been drawn to the American dream of a better future; America’s allure is partly its ability to transform others into Americans. It is, therefore, not surprising that America’s global agenda is transformative; it is a rule-maker.

The Chinese, on the other hand, have not tried to change the world, but rather to adjust to it. China’s relationships with other countries are channeled through its diaspora, and the Chinese perceive the world via their experience as immigrants.

Chinatowns — often-insular communities located in large cities around the world — are at the heart of the Chinese experience of the world. As the political scientist Lucian Pye once observed, “the Chinese see such an absolute difference between themselves and others that they unconsciously find it natural to refer to those in whose homeland they are living as ‘foreigners.’”

While the American melting pot transforms others, Chinatowns teach their inhabitants to adjust — to profit from their hosts’ rules and businesses while remaining separate. While Americans carry their flag high, Chinese work hard to be invisible.

Because China is about adaptation, not transformation, it is unlikely to change the world dramatically should it ever assume the global driver’s seat. But this does not mean that China won’t exploit the world for its own purposes.

America, at least in theory, prefers that other countries share its values and act like Americans. China can only fear a world where everybody acts like the Chinese. So, in a future dominated by China, the Chinese will not set the rules; rather, they will seek to extract the greatest possible benefit from the rules that already exist.

So this is the paradoxical nature of our new world — the spread of democracy and capitalism makes it more difficult if not impossible to build lasting value-based coalitions. At the same time, it makes it possible for the international liberal order to survive even in the case that the West’s power declines and the powers of authoritarian capitalism enjoy a temporary rise.


Ivan Krastev is the chairman of the Centre for Liberal Strategies in Sofia and permanent fellow at the Institute for Human Sciences in Vienna. He is a member of the board of the European Council on Foreign Relations.