Geopolitics

'We are in a geopolitical recession' - Ian Bremmer on globalization, populism and the power of crisis

Ian Bremmer, President, Eurasia Group, USA, Ivanna Klympush-Tsintsadze, Member of Parliament (Verkhovna Rada) of Ukraine, Kishore Mahbubani, Distinguished Fellow, Asia Research Institute, National University of Singapore, Singapore, Michael McCaul, Congressman from Texas (R), 10th District, USAModerated by Manuela Kasper-Claridge, Editor-in-Chief, Deutsche Welle, Germanyspeaking in Cold War 2.0 at the World Economic Forum Annual Meeting 2022 in Davos-Klosters, Switzerland, 23 May. Congress Centre - Forum. Copyright: World Economic Forum/Michael Calabrò

Post-WW2 institutions no longer line up with the global balance of power - Ian Bremmer at Davos 2022 Image: World Economic Forum/Michael Calabrò

Robin Pomeroy
Podcast Editor, World Economic Forum
Anna Bruce-Lockhart
Editorial Lead, World Economic Forum
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Geopolitics

This article is part of: World Economic Forum Annual Meeting
  • Geopolitics is in a 'bust cycle', says Ian Bremmer, head of Eurasia Group.
  • Institutions created after the Second World War need urgent reform, and crises will force that to happen, he argues.
  • Subscribe to the Radio Davos podcast here and hear all our coverage from Davos 2022 here.

In coming years, humanity will face viruses deadlier and more infectious than COVID. Intensifying climate change will put tens of millions of refugees in flight and require us to reimagine how we live our daily lives. Most dangerous of all, new technologies will reshape the geopolitical order, disrupting our livelihoods and destabilizing our societies faster than we can grasp and address their implications.

So says Ian Bremmer in his new book, The Power of Crisis. Radio Davos caught up with the political scientist, founder of the research and consulting firm Eurasia Group, at the World Economic Forum's Annual Meeting in Davos 2022, where he had a lot to say about globalisation, populism and why the geopolitical architecture put in place after the Second World War is in drastic need of reform.

Ian Bremmer on Radio Davos: podcast transcript

Radio Davos/Anna Bruce-Lockhart: You have talked about the decline of global institutions over recent decades. Can you explain how you see that happening and why it has come about?

Ian Bremmer: In the global economy, we have boom cycles and we have bust cycles. And in fact, every seven years on average since World War Two we've had a recession. And because they happen so frequently, we know how to recognize them. And we have tools to respond to them. We have fiscal tools. We have monetary tools. And the playbook is very similar whether the United States or Europe or China. We just understand what it means. We don't like a recession. We want to respond to it.

We're now in a geopolitical recession. It's a bust cycle. And it's because our institutions increasingly do not line up with the global balance of power.

Ian Bremmer

The interesting thing is that geopolitics have recessions, too, but they're long cycles. And because they're long cycles, we don't necessarily recognize them as easily when they come, and we certainly don't agree how to respond to them.

We are right now in a geopolitical recession, and what causes that is actually very simple. You create institutions and architecture and when you do it aligns with the balance of power and the values and priorities of the countries in the global order at that time. Over time, the balance of power changes. But the institutions don't. They're sticky. And over time, those institutions become so far removed from the new evolving balance of power and different priorities and different values that the institutions erode. They start to break. They become delegitimized.

I'll give you an example. When the United States first put together the United Nations, the permanent vetoes in the Security Council were allocated on the basis of the victors of World War Two. So, of course, the Soviets were at the table. The Germans and the Japanese were not. In 2022, the Russians are led by a war criminal. They're not here at the World Economic Forum, and the Americans want to throw them out of the G20. Meanwhile, the Germans and the Japanese, who are the two major economies that are most committed to the rules and precepts of the United Nations Charter, to multilateralism, to rule of law, cannot be given permanent seats in the Security Council because they lost World War Two. Now, that's a stupid reason, but that's what happens when the world changes and institutions don't.

If you're driving your car, you'd get an oil change occasionally, you'd get a tune up, and over 20 or 30 years you'd eventually get rid of the car and you'd buy a new car. You wouldn't say, ‘The car is no good. I'm just going to walk going forward.’

When people say today, ‘Our institutions are broken. We just don't want these institutions. We just don't want this global governance. We should be doing it ourselves.’ No. No, you're not going to walk. You need global architecture, but you have to rebuild those institutions. And that's where we are in the world today.

Anna Bruce-Lockhart: What about the rise of populism in recent years, is that a symptom of what you are talking about here?

Ian Bremmer: In the same way that international institutions, global institutions, break down over time when they're no longer aligned with the balance of power, that also happens inside countries. And so, you can think about a social contract which exists when labour is comparatively strong and has the ability to influence outcomes to a much greater degree than it can today. Well, the inability and the unwillingness to adapt institutions inside a country to reflect a changing balance of power of that population will lead to a lot of anger on the part of people that are left behind.

Millions and millions of people were left behind because their own leaders did not redistribute the gains of globalization to help them.

Ian Bremmer

And we see this in the globalization conversation that we have in the World Economic Forum all the time. Pretty much everyone that comes to the World Economic Forum is an unabashed enthusiast of globalization, and there are good reasons for that. We have had 50 years of unprecedented global growth and not just enriching multinational corporations and the elites that serve them, but also creating a global middle class. That's a big deal. And there's reasons to be a cheerleader for that. But we also have to understand that inside countries, millions and millions of people were left behind because their own leaders did not redistribute the gains of globalization to help them. And that caused much greater inequality inside advanced industrial democracies to start, and increasingly inside emerging markets around the world as well, getting much worse because of the pandemic, getting much worse because of the Russia-Ukraine war.

When that happens, unaddressed, what you'll see is a whole bunch of people that are really angry with every elite they can find, whether it's the media or the corporations or it's the bankers or it's their own government leaders. And they will respond to a group of political entrepreneurs that see that seizing that populism is the best way for them to seize power. We've seen it on the left with someone like Lopez Obrador in Mexico. We've seen it on the right with someone like Bolsonaro - when lots of leaders all over the world are using that playbook because the institutions in the country are seen as not representative and illegitimate for the citizens,

In an environment where institutions are weak, eroding and delegitimized, you're absolutely not prepared to prevent crises from occurring. But you increasingly need crises to provide the impetus to rebuild and repair and recreate those institutions.

Ian Bremmer

Anna Bruce-Lockhart: And would you say that we're not really prepared for the crises that we're facing at the moment - the pandemic, the Ukraine war and so forth?

Ian Bremmer: In an environment where institutions are weak, eroding and delegitimized, you're absolutely not prepared to prevent crises from occurring. But you increasingly need crises to provide the impetus to rebuild and repair and recreate those institutions. So, no, this is a crisis-rich environment. We're going to see many more, precisely because the institutions are breaking down. But those crises are absolutely indispensable if you want any chance to effectively build a new global order. And that is what we are seeing with the Russian invasion of Ukraine, there’s no question.

So Putin did not believe that the West could respond, believed that Biden was weak, Merkel was gone, Macron was going his own way, NATO was either obsolete, according to Trump, or brain dead, according to Macron, that the Chinese were his best friend. Of course, after 2008, no one did anything in Georgia, to 2014, no one does anything in Ukraine. Putin sees this is an opportunity. ‘Look how weak and divided the world is. I can take Ukraine.’ And he was wrong because he created exactly the crisis that was necessary to force the West to get out of its comfort zone and take on sacrifice. That's what it was.

I mean, it was Democrats and Republicans who hated each other but hate Putin a lot more. Just over the past weeks, I saw Nancy Pelosi leading the Democratic Party, making a delegation to Kyiv. And then I saw Mitch McConnell leading the Republicans, taking his own delegation to Kyiv. And their talking points were virtually identical. Why? Because of Putin.

I see the Europeans willing to spend far more on their own national security and defence. American presidents, Democrats and Republicans, have been begging and cajoling and pressuring the Europeans to do that for decades. They said no. But Putin invading Ukraine was enough to get it done. Finland and Sweden joining NATO - same thing. So what's this all about? This is all about a necessary crisis to force institutions to be reformed, to force leaders to take responsibility for the changes that are necessary. But life as is on a day to day basis wasn't going to get them there.

Ian Bremmer's book The Power of Crisis
Ian Bremmer's book, The Power of Crisis. Image: Simon & Schuster

Anna Bruce-Lockhart: What about climate change?

Ian Bremmer: Climate change is also very clearly a crisis that is necessary to change governance, and it's one that we've been ignoring for a long time. I mean, 20 years ago, climate was largely something seen as the domain of activists. It was ‘save the whales’ and ‘hug the trees’, and it was affecting the world, but mostly in the future.

And the people that were really suffering were disenfranchized people. It was the Maldives deciding to have a ministerial meeting underwater to show what it was going to be like as the oceans would rise. It was Bangladesh saying, we're not going to have food, we're going to have massive floods, what are you going to do about all this? But for the average global citizen, especially the average global elite, was it urgent? Absolutely not.

The world is coming together to respond to climate change in a way that was unimaginable even 10 years ago. Why is that? Response to crisis.

Ian Bremmer

But today, with 1.2 degrees centigrade of warming - and it's an issue in California and in Italy and in Australia and all over the world and getting worse and worse and worse - it has forced countries to come together and companies to come together and banks to come together and young people, most importantly, to come together and demand that you are going to make changes because you are destroying our future or else we will make you pay.

And as a consequence - look, it's later than we'd like, and and the difference between 1.5 degrees warming and 2.5 degrees warming is a matter of tens of trillions of dollars and hundreds of millions of lives, so there is a lot of reason to keep your foot on the accelerator in driving for faster transition to renewables. But make no doubt, the world is coming together to respond to climate change in a way that was unimaginable even 10 years ago. Why is that? Response to crisis.

Anna Bruce-Lockhart: So what tangible body or mechanism is there for actually making these changes to global governance happen? Can you give any examples?

Ian Bremmer: When you talk about something like climate change, the institutions don't exist because the challenge is new. I read Kim Stanley Robinson's wonderful near dystopia called Ministry of the Future, a new global institution that is created that takes away a lot of sovereignty in terms of responding to a world with far too much carbon in the atmosphere and far too much human degradation as a consequence. It's, by the way, a world that to me looks a lot worse than the world I think we're presently heading on, precisely because a lot of the concerns, the alarms that have been raised, have started to lead to real action and real investment in new technologies at scale that are getting cheaper. But the point is that, you know, the COP summit process or the Intergovernmental Panel on Climate Change, these are new institutions that are put together specifically to respond to climate.

I'll give you another example that's closer to my heart, which is NAFTA, because I was a big supporter of NAFTA when it was created. It was an advanced standard trade deal that helped to organize the trade flows of a very robust part of the global economy the U.S., Mexico and Canada. But by the time Trump became president, NAFTA only reflected less than 50% of the trade between the three countries. The reason for that is because so much of the trade was about services and data. That wasn't true decades ago, but it is now. And so you needed a new architecture. You could have called it the new NAFTA, they called it the US-Mexico-Canada Agreement. I don't care what the name is. The point is the institution needed to be meaningfully different or it wasn't going to be useful.

So when you ask me what are the institutions that we need to respond to these challenges, I see a lot of those institutions need to be built.

Another example. When I was growing up, the most important disruptive technology that we needed to contain were nuclear weapons. We were concerned that these weapons would destroy the planet if we did not stop them from being proliferated to other governments, to rogue states, to non-governmental actors. And we did stop them, over the course of 80 years. We've done a remarkably good job in a small club of nuclear countries and a number of responsible actors that are aligned with them to ensure that there are severe penalties and restrictions and monitoring to stop that proliferation from occurring.

Now, today we have a lot of other very dangerous technologies that are being developed, lethal autonomous weapons, for example, cyber weapons, for example, algorithms for disinformation. And yet we have absolutely no architecture, not only to prevent them from being proliferated, but even to understand the nature of the problem itself.

We need an intergovernmental panel for artificial intelligence, just like on climate change.

Ian Bremmer

So, for example, we need an intergovernmental panel for artificial intelligence, just like on climate change, where every year all of these experts get together and they say, you know what, we have 1.2 degrees centigrade of warming and here's the impact on the planet. You can't effectively respond to a crisis until you all agree on what the crisis is. Well, that's precisely what we will need in response to disruptive technologies. But that institution does not yet exist. So we'll have to create it.

And will it just be governments? Probably not. In the same way that the response to climate is not being driven primarily by Washington and by Beijing, but is being driven primarily by multistakeholder approach. It's a bunch of activists who matter and have the ability through social media and other channels to make a difference, to have their voice have economic impact. It’s banks with a longer approach towards thinking about their portfolios, recognizing they wouldn't make money out of investing in thermal coal. So they moved their assets.

It's corporations who say, we are going to lose market share if we don't seize the future that we see coming quickly in front of our faces. It's the European Union moving much faster than the Americans or the Chinese were. When Trump pulls out of the Paris Climate Accord, it's mayors and governors in the U.S. keeping the Americans on track. So it's not just about the government.

So if I were to say, how are we going to create new architecture to respond to the proliferation of dangerous and disruptive technologies? I would say, yes, governments will be involved, the technology companies will be involved, and, you know, a whole bunch of individuals will be involved. It's a very, very different kind of architecture. It's a post Westphalian architecture because power has become much more diffuse.

Anna Bruce-Lockhart: So how do you create bodies like that, and how do you make the process transparent enough to bring the public along with you?

You get the best out of humanity when you're challenged. It's the geopolitical equivalent of 'flow' state.

Ian Bremmer

Ian Bremmer: Well, how did you create such a body for climate change? And the answer is, it required incentive. And the mobilization was not going to get done until people recognized that it was a serious and urgent problem. I wish it were different. I wish that we could create these institutions out of whole cloth. But the reality is that people are busy and they're focused on their own lives, and understandably so. But we also know that you get the best out of humanity when you're challenged. It's the geopolitical equivalent of flow state. I mean, individuals who, if they're not challenged at all, will mail it in. And if they're challenged so much that it's overwhelming to them, will curl up in a ball and won't do anything. That needs to happen geopolitically.

It's what I call a Goldilocks crisis. It's not so small that we ignore it. Crack cocaine in the eighties in the United States, a massive problem that largely affected disenfranchized blacks in the United States. So a lot of performative anxiety and political outrage, and nothing at the policy level. But suddenly have it affect everybody and your household and your local congressman, and you're going to move. Think about the mass killings that we have in the United States and the gun violence. A lot of hopes and prayers, a lot of performative response, but not a lot of ‘we're going to fix this’, even though we know what the fixes would be. Precisely because it's not seen to be a suitably urgent crisis.

When we talk about disruptive technologies and climate change and the pandemic and the Russians invading Ukraine, we're talking about crises that are global and they're crises of scale. They're crises of urgency. And so they do lead to they compel serious response.

The horrible thing about a geopolitical recession is it will create shocks. It will create more crises. Klaus Schwab said it himself at the World Economic Forum, kicking it off this year - this is an unprecedented number of serious global crises. We've never experienced such a thing in the 52 years, 53 years that the WEF has been around. Why not? Because it’s our first geopolitical recession since World War Two.

Now, that was a big one. That was a geopolitical depression. We don't have to end up in World War Three. These crises are occurring in a world that is very interdependent. So I think it's very important to recognize that at the same time that we've isolated the Russians and they're nowhere to be seen in Davos, the Chinese are absolutely indispensable to all of the solutions that I've just discussed with you. And so I don't believe that a Cold War between the G7 or the West and Russia necessarily leads to a fragmentation of the global order. It doesn't lead to the Americans versus China. Precisely because there is so much that those two countries desperately need each other for going forward, even if they don't want to admit it. And also, so few countries around the world that would be up for picking a side in such a fight. I think these are indispensable points.

Ian Bremmer in the 'Forum Live' studio at Davos 2022.

Anna Bruce-Lockhart: On that - how do you see global international relations right now, particularly between the United States and China?

Ian Bremmer: Look, there is no trust between the United States and China. That's very clear. And for the two largest economies in the world, that reality is deeply unfortunate. But that doesn't mean that we suddenly don't need each other anymore. The fact is the Americans would be deeply aggrieved if the Chinese no longer wanted to be tourists and spend their dollars in the United States, the most important country that does so. They'd have a serious problem with their universities if Chinese students no longer came over and paid full freight for mid and low tier colleges. They’d have a serious problem if the Chinese were no longer providing relatively inexpensive goods that the Americans want to buy at their Wal-Marts and their Targets. And, by the way, the Chinese would have a problem if those things were taken away from them as well. They want to sell those goods. They want to travel. They want to send their kids to the best universities. All of this is true. We just don't want to say it, we don't want to admit it. Because ‘America First’, because 'Chinese prosperity', the 'China dream'. Everyone wants to focus on, ‘we can do it for ourselves’. The reality is we can't.

This nationalism is incredibly toxic. The idea that human beings should be identified primarily on the basis of their country of residence or where they happen to be born, is absurd. It's a kind of racism. It takes away, it strips away their fundamental humanity. It's so clear when we talk about the crises in the world today that the most fundamental identifier we have is ‘human being’. Now, for many years, a lot of global elites forgot that because they believed that the global problems could be fixed by them and everyone else should just have to go along to get along. That's why there's such a backlash against those elites. But that doesn't make it any more real that the ties are human ties. The response cannot be a retreat to within your borders, because that is the route to the end of our species.

Anna Bruce-Lockhart: Really?

Ian Bremmer: Of course. I mean, what else can we do? Right? I mean, these are global challenges. If we respond as individual countries, we're not going to be here for long.

I talk about this a little bit in my book, it's kind of dark, but it's interesting. I've always wondered about life ‘out there’. This is such a marvellous and extraordinary thing, just to be conscious. How is it possible that we're the only life in the universe? And it turns out that a lot of astronomers think about these sorts of questions. And now that we know just how vast the universe is and how many other stars there are, and solar systems and planets that we've found that could potentially sustain life. And so they look at what's the likelihood that there would be additional intelligent life to develop around the universe. And of course, the likelihood turns out to be incredibly high and not just in one or two instances, but in millions and millions and millions of instances. But what's interesting is not how likely life is, but how likely life is now, because, of course, humanity's only been around for a cosmological blink. And that's particularly true if you think about the period of time from when humans started to have the ability to affect their surroundings, to when humans have the ability to destroy them.

And it's very clear that that responsibility is one that needs to be taken very seriously, because it's quite possible that we are the only intelligent life in the universe now because it doesn't last long. And if we are going to think about the responses to these challenges as human beings on this little ball that have the ability to progress but also have the ability to destroy, then we have to take them on together.

I started my book with this little vignette from Reagan and Gorbachev when they first met. It was in Geneva in the 1980s, and the story didn't come out for decades because it was only the two men in this dacha and their translators. And Reagan asked Gorbachev, ‘So if we were invaded by aliens, you'd come to our defense, right?’ And Gorbachev said, ‘Of course, of course we would’. And Reagan said, ‘Well, we would, too’. And it sounds kind of silly, but it actually led to a relationship of some trust between the two men and helped to facilitate some arms control agreements that reduced the likelihood that we were going to blow up our planet.

The challenges that we are facing today and in the next generation - and we're not talking about a hundred years here, we're talking about 10, 20 years - are challenges that are existential to the planet. And there are aliens. There are aliens that are coming to destroy us. Except the aliens are us. The aliens are us. And if we want to respond to that challenge, we have to be as courageous as Reagan and Gorbachev were in that dacha in Switzerland.

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