#132 A (Non) Manchurian Candidate 🎧

While excellent newsletters on specific themes within public policy already exist, this thought letter is about frameworks, mental models, and key ideas that will hopefully help you think about any public policy problem in imaginative ways. Audio narration by Ad-Auris. Global Policy Watch: G7@Cornwall: Return Of A Rules-Based International Order? Bringing an Indian perspective to burning global issues - RSJ A key geopolitical question to ask as most of the world gets back to normalcy following the pandemic is - what kind of a world will we be living in? I was expecting the G7 meeting held in Cornwall last week to help with an answer. It didn’t entirely. But it did help in framing the key questions that will engage commentators discussing about the world order this decade. The rhetoric at the end of the summit was summed by Boris Johnson: “the West is back”. Johnson and Biden repeatedly made the point about the summit representing the coming together of the great democracies of the world. Others parroted the same line. Even PM Modi speaking on the final day as part of the outreach programme positioned India as a natural ally of G7 in its resolve to fight the challenges arising out of authoritarianism, terrorism and disinformation. Democracies V Autocracies Now? The need to counter the ideological and economic challenge of China has bipartisan support now in Washington. Naturally, Canada, UK and Japan are in the same boat. The summit succeeded in making the somewhat reluctant Germany, France and Italy come around to the same view. This looks like an attempt to roll back the Cold War years. But like we have written in the past, China is a very different threat from the erstwhile USSR. In fact, it is USSR on steroids. So making the threat of China into the familiar construct of Cold War that you are comfortable dealing with is like searching for your lost keys under a lamppost because there’s light under it. It will be easy to search but you won’t necessarily find the keys. The other problem for G7 is how to treat Russia. With China the two strands of a superpower contest and the mortal combat with an illiberal regime that won’t reform as was expected, come together. So it offers ideological clarity. Russia isn’t an economic superpower and its political strength is restricted to its backyard. But it ticks all the boxes of a rogue, authoritarian regime - stifling dissent, encouraging crony capitalism, launching cyber attacks against other nations and meddling in their elections. Does the G7 slot Russia into the same ideological enemy category as China and push it further into its arms? Then we have a very different Cold War on our hands. Or, does it give Russian illiberal tendencies a free pass to keep it neutral and counter the threat of China? The Putin-Biden summit that followed the G7 meet seems to suggest that’s the likely course of action. But if you do that, where is the ideological glue of ‘great liberal democracies’ coming together? What stops other democracies (Brazil, Turkey, India and many more) to go down authoritarian route knowing the ideology is a sham? Marshalling A New Plan? The other question is how committed are the G7 to back their return to relevance with financial support, commitment to free trade and moral leadership during the next crisis? The evidence during the pandemic wasn’t flattering. It was everyone to themselves. The easy thing is to blame it on Trump but the hesitancy of Biden administration during early days to share its vaccine stockpile suggests ‘America First’ won’t just disappear after Trump. The summit threw up two responses to allay concerns on this. One, the promise by G7 to provide for more than one billion vaccine doses to the developing world. This was a late but welcome step to regain a semblance of moral authority. But one billion isn’t enough to inoculate the poorest in the world. It didn’t go far enough. Two, the G7 decided to counter China’s Belt-and-Road initiative (BRI) with its own plan to lend billions of dollars in financing infrastructure in developing nations. As the New York Times reported: The plan described by the White House appeared to stitch together existing projects in the United States, Europe and Japan, along with an encouragement of private financing. A fact sheet distributed to reporters gave it a name, “Build Back Better for the World,” with roots in Mr. Biden’s campaign theme — shortened to B3W, a play on China’s BRI. It emphasizes the environment, anti-corruption efforts, the free flow of information and financing terms that would allow developing countries to avoid taking on excessive debt. One of the criticisms of Belt and Road is that it leaves the nations that sign on dependent on China, giving Beijing too much leverage over them. There are a few problems with this plan. One, it is not clear how much of a success BRI has been for China. The programme has been beset with inflated costs and accusations of debt trap by countries borrowing from it. China seems to have gone tepid on it too. So, why copy a plan that failed for China? Two, Italy is already a member of the BRI and France and Germany don’t share the Biden’s administration conviction in taking on China economically. There are huge investments and trade deals hanging in balance there. This isn’t as tight a house as it appeared from the outside during the summit. Three, the G7 equivalent of BRI will need capital contributions from all the members who aren’t themselves in the best fiscal state at this moment. And we aren’t even counting the unresolved Brexit issues (including the Northern Ireland protocol) between UK and EU which threatened to sour the summit. The US treasury seems ready to sign ever increasing checks for domestic stimulus, infrastructure and green deal. Now they will have to fund this too. The icecreams cannot keep coming out of the truck indefinitely. Also, the G7’s insistence of democracy and human rights record will make many developing countries continue to look at the guilt-free Chinese loans. And let’s admit it, there are more of those regimes than others. Four, the G7 will have to respond to the popular opinion in their own backyards and it is difficult to see how over the next decade free trade, multilateral funding and supporting infrastructure around the world will be politically rewarding. A few regime changes among the G7 nations and this plan will come unstuck. China meanwhile has no such problems. Xi isn’t going anywhere soon. Nor is Putin. Saving Humanity? The final question is how will the G7 respond to future global crises after learning the lessons from this pandemic? The list of existential threats to the world isn’t short today with climate change at the van. The summit picked up climate change with a renewed pledge to raise $100bn a year through till 2025 to help developing countries cut emissions and move away from coal. There are two problems here. First, this isn’t enough for poorer nations to stick to their climate goal commitments. It will be interesting to see how this pans out with the UN climate summit that’s coming up in Glasgow this November (also known as COP 26). The lack of details in the climate change plan - “green revolution” - that would limit the rise in global temperatures to 1.5Cand reach net-zero Carbon emissions by 2050 makes the whole thing sound like the many empty pronouncements of the past. Second, it is difficult to address climate change without bringing China, Russia and other large populous developing nations (Brazil, India, Indonesia) into the mix. Solving global existential threats require what Richard Haas and Charles Kupchan call the ‘concert of powers’ approach. But how do you do that if you want to frame China and Russia as ideological foes in the new Cold War? About India On the balance, the two positives from the G7 summit were quite clear. America led by Biden will not go back to lurking in the backstage of global geopolitics. And, China won’t get… This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit publicpolicy.substack.com