Abstract
The world is moving toward a tri-polar configuration, with the United States, the European Union, and China dominating regional zones of influence while vying for global power. The pandemic, with its differentiated impact on each, has only accelerated centrifugal tendencies toward such a “triadic” configuration. The three power centers also represent different variants of capitalism which will shape how they set themselves apart. The tension between competing with each other and cooperating in the pursuit of the global common good, especially the zero-carbon transition, depends not least on redefining globalization in a more progressive, equitable, and stabilizing direction that leaves space for “live and let live” strategies of policy-making. Much of that redefinition hinges on how to manage an inherently more complex multi-currency system where the dollar, euro, and yuan represent alternative forms of world money. Different scenarios are possible, including coordination rules based on target zones for the key exchange rates all the way to anchoring the emerging international monetary system eventually on the International Monetary Fund’s Special Drawing Rights as a steadily more important, supranational form of world money.
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Notes
- 1.
Such post-crisis reform periods, as we saw with Roosevelt’s New Deal in the 1930s or the Reagan Revolution in the 1980s, play a crucial role in the transition from one accumulation regime to another, a key argument in Régulationists’ framing of history’s rhythm in terms of long waves (see especially Aglietta, 1976/1979; also more broadly Sects. 2.1 and 2.2).
- 2.
- 4.
The term “carbon bubble,” popularized during 2015 in the run-up to the Paris Climate Agreement, refers to trillions of dollars in stranded assets (e.g. oil refineries, coal-fired plants, fuel-combustion cars) arising from the planned obsolescence of a fossil-fuel-based economy needing to be phased out to achieve carbon neutrality before it is irreversibly too late. See Rubin (2015) or McKibben (2015) for original-use examples of this timely term.
- 5.
For more details on this remarkable gathering of the world’s leaders on Zoom to discuss the challenge of climate change and how best to proceed with the goals of the Paris Agreement, see U.S. Department of State (2021).
- 6.
This distinction between globalization and deregulation, and how those two get confused and obscured for the advantage of the owners of capital able to act trans-nationally, see the excellent discussion of “new globalization” by Sandbu (2021). His article discusses also the useful suggestions of an international commission headed by Blanchard and Tirole (2021), one former chief economist of IMF and the other 2014 Nobel Prize winner in economics, to deal with the triple challenges of intensifying climate change, inequalities, and demographic aging.
- 7.
The WTO, let us not forget, has already “jurisdiction” over many non-tariff barriers to trade (e.g., anti-dum** duties, subsidies), trade-related investment measures (TRIMS) allowing governments in emerging-market economies to impose conditions on multinational corporations, and trade-related intellectual-property systems (TRIPS) governing technology transfer. It has also begun to focus on the so-called “Singapore Issues” of trade facilitation (see WTO’s Bali Agreement of December 2013), transparency in government procurement, trade and investment (aforementioned TRIMS), and competition policy.
- 8.
I recommend Professor Mazzucato’s personal web site https://www.marianamazzucato.com for a comprehensive and well-integrated presentation of her most salient arguments rethinking the role of government nationally and in the international economy. They are also brilliantly laid out in her latest book, Mazzucato (2021), which is especially timely as we move toward a new accumulation regime in the making.
- 9.
See Ball (2020) on the notable details of the global vaccine development effort against the Cov-SARS-2 coronavirus.
- 10.
Perrault and Sacks (2021) make an interesting argument how Biden might best alter Trump’s rather blunt launch of a tech war against Chinese high-tech companies.
- 11.
- 12.
Krugman’s (2021) argument rests mostly on his claim that being issuer of the currency serving predominantly as world money does not have a lot of meaningful implications, were it not for its ability to borrow at zero interest quite a bit from foreigners holding an inordinate supply of $100 bills for illicit purposes. He thinks neither America’s ability to run chronic current-account deficits, given similarly large ones by Australia or Great Britain, nor to borrow cheaply from abroad, looking here at much lower, often altogether negative, yields in Europe, are that big a deal. Losing those advantages would then logically not make much difference either.
- 13.
- 14.
The fascinating “overdraft” arrangement of TARGET2 as the equivalent of an intra-Eurozone payments union is well discussed in European Central Bank (2021).
- 15.
The financial transactions tax, also known as “Tobin tax” after its inventor Tobin (1978), could be a tiny fraction of total transaction volume, say 0.5 percent, and still hit speculators like a significant tax of, say, between 10 and 25 percent on their own capital invested. Speculators use highly leveraged currency derivatives contracts which may require 2 percent or 5 percent down-payment. In addition, speculators tend to have very short hold periods and thus rapid turnover, which means they have to pay that tax often, each time they trade.
- 16.
Pulitzer Prize of 1988 winners Stewart and Hertzberg (1987) wrote a grip** account of the market panic’s second day during which United States financial regulators, grouped together informally under the coordinating direction of new Fed Chair Alan Greenspan, used lunch break for a concerted market intervention turning around an otherwise fairly obscure stock-index futures contract that sparked the desired market rebound in the afternoon.
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Guttmann, R. (2022). Cooperation vs. Competition in a World of Adversarial Power Centers. In: Multi-Polar Capitalism. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-030-88247-1_7
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