Ian Bremmer on winners and losers in the new world order
One of the dirty little secrets about journalism is that you can have an interview subject with such a high intellect that it intimidates the hell out of the writer. Ian Bremmer certainly qualifies as one of those subjects. With bestselling books like Every Nation for Itself and The End of the Free Market, Bremmer has become an international guru of risk, and his New York consulting firm, The Eurasia Group, advises corporations and governments on how to handle their stickier political and economic problems.
Bremmer himself moves in the rarefied air of the elites, writing for Time, the Financial Times and the Wall Street Journal. He’s been a familiar face at Davos; in fact, the latest Davos summit was on when we caught up to him, though he didn’t attend this year.
I wonder if Davos 2015 demonstrated Bremmer’s premise in a microcosm, that—as his book blurb concisely puts it—“there is no single power ready to take on the challenges of global leadership,” and that we were no longer in a world of G7 or G20 but in what he’s coined as “G-Zero.” Bremmer doesn’t hesitate.
“Oh, absolutely,” he says, and he tells me how he was chatting with another former world leader, and that “everything he’s telling me, from what’s happening in Davos right now, is full on G-Zero, right? It’s enormous concern about a lack of leadership. It’s enormous concern that global institutions are taking a battering.” But he cautions that G-Zero is just beginning as a phenomenon.
“We’re going to have to go through this period. It’s not a new world order, it’s an interregnum. It’s something between a U.S.-led global system and something new that we don’t know yet.” While the American and Chinese economies are doing well this year, he points out “the willingness of the Americans and the Chinese—the two largest economies in the world—to do a lot outside their countries has diminished pretty dramatically, compared to the necessity that a lot of other countries actually feel…
“We’ve gone very far from a world that is U.S.-led to one where the Russian deputy prime minister stands up saying, if you cut us off of SWIFT that’s tantamount to war, that we will, as a consequence of Western aggression, build an alliance with the Chinese…” SWIFT is the Society for Worldwide Interbank Financial Telecommunication, the co-operative handling financial message traffic for tens of thousands of banking institutions. “It’s not that I believe we’re at the precipice of war—I don’t believe that at all—but I do think that we are seeing, sort of, a lot of bonfires that are emerging, and that no one is going to particularly put them out.”
From compassion fatigue to lost influence
Bremmer has opposed the idea of sanctions against Russia over Ukraine, arguing that other nations—particularly China and India—won’t play along, which will mitigate any damage caused.
But what, then, is left? It’s important to note that our conversation took place more than two weeks before President Obama sent Congress a draft authorization on using military force. Bremmer’s suggested method of negotiation sounds like old-fashioned appeasement, and it’s a struggle to think of an alternative.
When I put this to him, he replies, “The number of mistakes that we’ve made on Russia and Ukraine sort of boggles the mind. It’s not because I’m critical of Obama, I think they’ve [the administration] actually done a better job [there] than lots of other areas on policy… It was very abundantly clear that Ukraine is the single most important foreign policy interest that the Russians have.”
Ukraine, says Bremmer, is of no such interest to the U.S. or for that matter, most of Europe. “You’re telling the Russians that if you don’t behave, we’re going to isolate you—that’s not true.” As an example of ratcheting up tensions and poor strategy, he cites the case of Michael McFaul, “a very good friend of mine,” who on his first day as ambassador to Russia met with opposition parties. “Let me be clear,” says Bremmer. “We never would send an ambassador like that to China, because we care about China. China’s important.
Russia, we don’t care, and they know that—they’re not stupid, and that upsets them, and it upsets Putin. Unlike North Korea, Putin is actually in a position of some strategic importance, and has the ability to do things that we don’t like, that could actually hurt us. So I would modestly submit that on pretty much every front, our policy towards Russia has been massively counterproductive.”
His G-Zero landscape encompasses more, however, than the rise and fall of the great powers. In Every Nation for Itself, he predicts “many NGOs that monitor emerging states’ compliance with Western standards of civil and human rights will be losers as their principal supporters—established powers and increasingly anachronistic international institutions—lose their force. Authoritarian governments know that established powers no longer have the political and economic leverage to do much more than complain when aid groups and independent watchdogs are obstructed and harassed—or even ejected from these countries.” When I asked about this, he summed it up flatly: “…historically, if you don’t have the United States backing up these measures, you’re not going very far.”
Projection of power, weapons of finance
And if we’re going to talk about influence, in a recent appearance on MSNBC’s Morning Joe, Bremmer offerd a far more intriguing gambit for capturing it, what he’s called the “weaponization of finance.” “We’re still projecting power,” he told the show hosts, “but we’re doing it in a way that’s a lot more unilateral.” Exhibits A and B: drones and surveillance. But the mighty greenback and market access can also be used as a stick. That doesn’t, however, necessarily mean America knows best how to wield this club. I asked him to elaborate on this idea.
“Well, I mean, the United States is not an obvious country to employ the weaponization of finance, and the reason for that is because historically, we have an extraordinarily strong State Department. We have an extraordinarily strong CIA… but we don’t really do industrial policy.
“So, I mean, the Commerce Department is actually very weak, both in power and in talent, and who it can attract… The Department of Energy is not part of Commerce at all, right? Now if you look at a country like Japan, you’ve got METI, the Ministry of Economy, Trade and Industry that’s actually not only the strongest and most capable ministry that Japan has, but it’s all one place.” The reaction he got from others over his analysis was one of: “Like, how can you say this?
I’m like, ‘Look, I’m not saying they don’t know what they’re doing, I’m just saying there’s no strategy.’” Bremmer believes if the U.S. wants one, it should rest with an organization with decisionmaking authority and with people who are smart enough to think it through. “Those things do not exist.”
The weaponization of finance, he says, “is a type of force in the same way that cyber is.” And the weapons are very different in the 21st century than they were in the last one, because “we have a government that is absolutely renouncing boots on the ground. But you’ll hear a lot of people say, ‘Oh, Obama’s weak,’ you know? ‘He’s a wimp. He’s not respected as a strong leader internationally.’ I actually disagree. I don’t think that Obama’s an isolationist, and I don’t think he’s a wimp. I think that he’s absolutely projecting power internationally.”
I wonder then about a possible backlash: a country may easily take all this as provocation, with a military showdown in the offing. “I take it you disagree with that line of thinking, though,” I tell Bremmer sheepishly.
“I don’t know why you would think I disagree with you,” replies Bremmer. “I mean, obviously, I think that on Russia, you’re completely right. The likelihood of military escalation with Russia has gone way up, precisely because the U.S. has put sanctions on in a very ineffective environment. The fact that I think that sanctions are occasionally useful as a tool, and absolutely need to be one of the tools in you arsenal, does not mean that every time, just because you have a hammer, everything is a nail.”
To Bremmer, sanctions are a doubleedged sword; against Cuba, they helped maintain its dictatorship for decades. For each of the tools in the box, “you want them to be deployed intelligently, which therefore means you want people in charge, and a structure of your governmental system that will work for those things.”
“Your strategy can also be a catalyst in terms of fermenting revolution,” I counter. “I’m thinking in terms of the Saffron Revolution in 2007 in Burma, I’m thinking of the Purple Revolution in Tehran in 2009…” And then the U.S. was on the hook to respond in some way to these unfolding events. “You can be,” says Bremmer. “You can be!” I echo. “You needn’t be,” he answers. “Just because the United States helped to break Iraq, doesn’t mean that the Americans feel particularly responsible for fixing it. So I mean, it’s also not clear that you’re necessarily going to find yourself, or feel yourself as on the hook. Americans have short memories on this stuff, but there’s no question that the use of these tools can sometimes be effective and can sometimes be ineffective. All you’re telling me is that lots of times these tools are used ineffectively. Agreed.” You can almost hear the shrug over the long distance line. “I agree— there’s nothing to disagree with on that.”
I laugh nervously, and we’ve come full circle to the fact that the subject is far smarter than his interrogator. “I’m just sort of surprised,” I say. “I didn’t expect that kind of response.”
“What are you surprised about?” Bremmer shoots back. “I’m an analyst. I’m not an ideologue.”
Copyright 2014 Rogers Publishing Ltd. This article first appeared in the March 2015 edition of Corporate Risk Canada magazine