by The Australian Financial Review
Western liberal democracy is being challenged around the world in ways it has not known since the end of the Cold War. Russia’s annexations in Ukraine in 2014, and China’s island-grab in the South China Sea in 2015 marked a return to great power confrontation not seen in decades or more. And on just the second day of 2016, Saudi Arabia’s execution of a dissident Shia cleric may have pushed the Sunni-Shia schism – the energy behind much of the Middle East’s conflict – beyond recovery. Already we are forced to hope that this year, unlike the last two, will finish better than it started.
The South China Sea is potentially the most far-reaching conflict. Beijing’s attempt at de facto control of the seaway is the first direct challenge to the US-led status quo in the Pacific in 70 years. It was under the US strategic security umbrella that Asia’s modern economic miracle took place, making a lot at stake even for China. A Pacific without clear US naval dominance will bring not a shining new Chinese hegemony, but a messily unstable multipolar system involving the world’s largest economies – in which an ever more insecure and fearful US, China, Japan, Russia and others in the region scheme and press for every advantage because they feel they must. If China meets no pushback in the South China Sea now, then the chances of it miscalculating later are greater. Australia has been right in recent months to join with the US in underlining the freedom of all nations to use these waters.
In the Middle East, Russia shrugged off its economic weakness to intervene in Syria, the first time since the 1970s that Russia has challenged the US for power broker status in this most dangerous of regions. Moscow’s arrival makes it even harder than it already was for the West to pacify Syria and build a regional coalition against Islamic State without Vladimir Putin’s say so. Syria’s war last year triggered the biggest flood of refugees into western Europe since 1945. That sent the European Union into its second deep crisis of 2015, as the European ideal of a single border caused similar rifts in the union as the single currency had done in the eurozone area. As the British weigh up quitting the EU altogether, it is Europe that looks tired, stagnant, and unable to fix itself.
This international disorder, along with wobbly post-GFC economies, and a sense of declining Western power, has rocked domestic politics too. From Donald Trump to Europe’s anti-immigration right and anti-austerity left, populists have noisily spread the idea that only foreigners, migrants or elites have benefited from the globalisation which the West invented.
But for all the gloomy commentaries, the populists have failed to make any electoral breakthrough with this message, outside the special cases of eastern Europe – and Greece, where they are now dutifully enforcing austerity. That’s a lesson for more mainstream political parties. Yes, globalisation has spread growth (and jobs) eastwards. But claims the West is therefore in decline are overblown when it is clearly still the wellspring of ideas and innovation. And market capitalism, an essentially optimistic view of the world, has done more to spread prosperity and reduce poverty than any other force around. Politicians in the West must confidently make the case for it against inward-looking populists, and the statist regimes in Moscow and Beijing they admire.
Meanwhile, Russian and Chinese adventurism has merely alarmed their neighbours and revived defence budgets across Europe, Asia and indeed Australia. Putin knows he cannot take the West head on, but he has failed, so far, in his ambition to rattle the Western alliance into division. And though the South China Sea is a very dangerous oceanic frontline, on matters from currencies to climate, the US and China still co-operate closely.
The West is under rising challenge, but it needs to remember it still has more going for it than against it.