There are three major international shocks currently shaping geopolitical decisions across the globe, according to former U.S. Secretary of State Condoleezza Rice — all of which are putting a squeeze on global economic growth as well.
As the opening keynote speaker at this year’s Global Financial Leadership Conference, Rice outlined the three shocks as the following:
1. September 11, which continues to impact the U.S. diplomatic and military role in the Middle East.
2. The Global economic downturn
3. The improving politics and economies in emerging countries like India, Brazil and China.
Rice regularly speaks on the U.S. foreign policy role throughout the globe, but not as often in the context of how it relates to the global economic situation. She stressed to the GFLC audience that relieving economic stresses in the United States and Europe will help ease political tensions across the globe.
“The thing that Europe needs most right now, and in fact the United States needs most right now, is global growth. If you could put on the agenda of the President of the United States a plan for global growth, so that this shrinking pie doesn’t exacerbate all of the political tensions out there, Europe would be helped, Japan would be helped, the United States would be helped. And it starts with reinvigorating the trade agenda… global growth through a robust trade agenda would help everybody.”
Rice argued that the U.S. has no trade agenda now — only three free-trade agreements have been ratified in the last four years, all of them signed under the Bush administration — and that China has a thriving trade agenda, having signed 15 trade agreements, and are negotiating 18 more.
In addition to the United States getting back on its feet economically and matching Chinese aspirations on trade, Rice stressed that the right kind of relationship with China is critical, too. She cited the over-concern of some to China’s launch of an aircraft carrier at a time when it is at odds with some of its neighbors over the Senkaku islands.
If we take on Asia as a military challenge, we are going to embolden the Chinese who want this to be about militarism and security. The right strategy in Asia is one that is an economic strategy. Recasting what we’re doing in Asia is another urgent point on the President’s to do list.
Finally, Rice framed the current global situation in terms of doing the things from a policy perspective that will be well-regarded by history, even if not in the current discussion.
“Reconstructing the world that has been blown up by the 3 shocks, the best thing to do is to trust history’s judgement.”