The World in 2050_ Four Forces Shaping Civilization's Northern Future - Laurence C. Smith [124]
It unraveled surprisingly fast. The June 28, 1914, assassination of Archduke Franz Ferdinand in Sarajevo initiated a chain of events setting off a world war, the suspension of gold-backed currencies, and a near-total collapse in global investment and trade. Even after hostilities ended, former trading partners remained bitterly divided, a collection of protectionist states heaping tariffs upon one another. Only after a second world war, followed by the United States and Britain’s deliberate reboot of the global economic order at Bretton Woods, did things start to recover. It took sixty years for merchandise exports to regain the levels of 1914.513 The rapidity of this collapse proves that unlike the three other global forces, it is possible for globalization to come to a fast halt. It is also a sobering reminder that national leaders can, on rare occasions, take their countries to war with trade partners even if it means gutting their own economies in the process.
Besides another world war, at least two things could plausibly weaken or halt the global economic integration of today. The first is obvious: Central governments could decide to abandon proglobalization policies in favor of a return to economic protectionism. A variant of this would be a shift from “globalization” to “regionalization,” with separate economic blocs emerging in North America, Europe, and East Asia.514 Some economists have argued that the 2008-09 global financial crisis will mark the end of an era for twentieth-century globalization and neoliberal policies. It is even conceivable that well-meaning carbon-reduction policies, by penalizing emissions by different amounts in different countries, could trigger tariff wars if countries respond by imposing border taxes to recoup their losses.515
A second possibility is the rising cost of oil. Global trade is fueled by cheap energy, and container ships and long-haul cargo trucks cannot readily be electrified like passenger cars as described in Chapter 3. And as environmental damages, too, are increasingly priced into production costs in manufacturing countries like China, the apparent profit margin of a global versus local trade network will narrow.
A deglobalized world with extremely high energy prices might be an oddly familiar one, with local farmers feeding compact walking cities, a return to domestic manufacturing, and airplane travel afforded only by rich elites. One could even imagine a reversal of the urbanization trend as farming returns to being a labor-intensive industry, no longer propped by cheap hydrocarbon for fuel, fertilizers, and pesticides. Overseas tourism would fade, perhaps to be replaced by virtual experiences or even uninterest and disengagement from foreign affairs.
Political genies are even harder to anticipate than permafrost genies. In my mind’s eye I imagine an even more integrated world in 2050 than 2010. But no one really knows if our globalization megatrend will accelerate, slow, or reverse over the next forty years. Of the four global forces, this one is the hardest to foresee.
Dragon Swallows Bear
At the smaller, more regional scale, the future of the Russian Far East is similarly murky.
This region is Russia’s gateway to eastern Asia. By any measure it is vast, resource-laden, and practically empty of people. It covers some 6.2 million square kilometers, about two-thirds the size of the United States and triple the area of Britain, France, and Germany combined. It is rich in oil and natural gas (especially Sakhalin Island and the Sea of Okhotsk), minerals, fish, timber, and a surprising amount of farmland. It holds one-third of Russia’s landmass but, with just 6.6 million people and falling, less than 5% of its population. Averaging barely one person per square kilometer, the Russian Far East has one of the lowest population densities on Earth.
Except for a tiny 20-kilometer border with North Korea, its main