Japan: A new world power in a new world order?

The political events of 1989 seem to signify the dawn of a new era of global politics. With groundbreaking negotiations between the superpowers and the liberation of the last remaining communist bastions the bipolar division of international relations that has existed since the end of World War Two has now totally disappeared. Consequently, the current state of world affairs and the position of individual nation-states within the new world order is uncertain.

This essay attempts to shed some light on this uncertainty via reference to theories of cyclical international politics which espouse the coming of a new global hegemon. It goes on to briefly assess the viability of a variety of states deemed to be the most likely inheritors of this crown, before providing justification of the final selection.

BIPOLAR - MULTIPOLAR - UNIPOLAR

When international affairs underwent a metamorphosis in 1989 the pattern that emerged constituted, for many, a multipolar new world order. Some people see this multipolar world economy being organised around a triad of regional blocs (North America, the European Union and East/South-East Asia) that dominate trade and manufacturing activity (Dicken, 1992). Figure 1 shows these regions. Between them, 77 per cent of world exports are generated for the global market along with 62 per cent of world manufacturing (value added) output.

Others, such as Cohen (1992), see multipolarity focusing on the fortunes of a pentarchy of nation-states that emerged dominant from the midst of the political upheavals of 1989.

Figure 1 A multipolar global economy - the 'triad' of economic power

Source: Dicken, 1992, p45

These states, fundamentally the same basic power centres that were ascendant in the period pre-1989, consist of the USA and Russia, China, Western Europe (with the former Eastern Bloc drifting towards the west) and Japan (Cohen, 1992).

However, proponents of cyclical international politics see this multipolar state of world affairs as merely transitory. Tracing the existence of world leaders through time, long wave/cycle theorists, such as Wallerstein (1984), Modelski (1987) and Kennedy (1988), note a conspicuous degree of symmetry within the capitalist mode of production. The symmetry is such that if the trends identified are extrapolated, then a new world power appears to be an inevitable outcome of global politics.

In Wallerstein's (1984) model of hegemonic cycles, three instances of hegemony are seen to have occurred since the inception of capitalism in the sixteenth century: Dutch hegemony in the mid-seventeenth century, British hegemony in the mid-nineteenth century and USA hegemony in the mid-twentieth century. Thus hegemony, in this sense, pertains to a general condition of dominance, where the base of such dominance is firmly rooted in economic supremacy (Wallerstein, 1984).

Reaching this position is generally achieved via three stages; firstly, achieving superiority in the production efficiency arena; secondly, developing this advantage into a commercial advantage; and thirdly, using the accumulated capital to achieve financial dominance of the world-economy (Taylor, 1989). In each of the cases so far, a nations preponderance is then confirmed in a thirty year world war.

A similar model is expounded by Modelski (1987), except in this instance five periods with world leaders are identified. Analogous with Wallerstein's model, Modelski's begins at the start of the sixteenth century and develops in a cyclical manner. His cycles are of a hundred years in length during which a power emerges, blossoms and declines, the decline phase simultaneously occuring with the emergence of a new power etc. The five world powers noted by Modelski are:

Portugal in the sixteenth century, Holland in the seventeenth century, Britain in the eighteenth and nineteenth centuries and the USA in the twentieth century (Modelski, 1987).

Table 1 shows the details of these five periods of world leadership according to Modelski; the symmetry between the periods being quite striking. Each power established itself via a world war from which it emerged triumphant, earning itself the 'right' to implement a legitimising treaty "which formally sets up the new world order centred on the new world power" (Taylor, 1989, p59). Inevitably, the plus-phase of the cycle gradually changes to a negative-phase during which hegemonic decline sets in. This decline is followed by change in the world order; progressing from unipolar through bipolar to multipolar relations before the ensuing plus-phase of the subsequent cycle begins (Modelski, 1987).

Thus, as with Wallerstein, the important point is that the capitalist system is a dynamic one that is continuously oscillating; world powers rise and fall and international relations pass through varying degrees of polarity. Consequently, theorists such as Dicken (1992) and Cohen (1992) who argue the multipolar nature of world affairs are quite right for the moment but, according to proponents of the cyclical theory, it will not be long before the onset of the next hegemonic cycle makes their theories temporarily obsolete.

CANDIDATES

So, if the coming of another world power is the inevitable course of global politics, ...

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CANDIDATES

So, if the coming of another world power is the inevitable course of global politics, then which current nation-state will develop into such a power? The likelihood is that it will be one of the core nations that currently comprises a part of the multipolar situation. It is these states that are the most dynamic, or have the potential to be the most dynamic, in the important economic sphere.

But which of those identified is liable to be the next world power? Of Cohen's (1992) pentarchy of powers, four are contained in Dicken's (1992) triad of regional blocs: this cannot be coincidence and implies that attention should be focused on the USA, western Europe, Japan and China as the source of the next hegemonic state. But which of these constitutes the most viable option?

Western Europe and China are likely to be out of the reckoning, although both are liable to be contenders for future cycles. The former lacks any sort of political cohesiveness and runs the risk of being (temporarily) crippled by the westward drift of the former eastern bloc, whilst the latter, despite undoubted natural resources and liberal reforms, "is [still] a developing country and, despite favourable growth, will remain so well into the next century" (Nye, 1992, p86; Cannon and Jenkins, 1990, Pfaff, 1991, Nye, 1992). This therefore only leaves the USA and Japan as contenders for the world leader crown.

The USA, a former superpower, achieved its hegemonic status as a result of favourable conditions in 1945:

"The US emerged from the Second World War as a major power creditor with its territory unscathed, a booming economy, a nuclear monopoly, and a State Department with plans for the economic management of the globe" (Pugh and Williams, 1990, p2).

However, recent years have seen an apparent reversal of fortunes. The emergence of new global economic actors (notably the E.U. and Japan) has combined with America's 'natural' economic decline to escalate its demise.

In a very short space of time the US has been transformed from the world's largest creditor to the world's largest debtor (Vogel, 1986). A positive foreign debt balance in 1980 has been replaced by a $500 billion debt in 1989 which looks set to increase. Simultaneously, domestic US government debt has increased to $2.7 trillion in the same year, the situation prompting President Bush to proclaim that "the US has the will to remain hegemonic but not the wallet" (Bush cited Nye, 1992, p94; Lewis, 1992).

A corollary is that President Clinton has recently proposed a 34 per cent reduction in the US defense budget (compared with the 1989 Reagan-era peak) to $252 billion by 1998 (Tonelson, 1993). This represents an expenditure of just 3 per cent of GNP (cf. an average of 6.5 per cent of GNP) which takes defence to a level not seen since before World War Two (Tonelson, 1993). In this sense, America appears to be emulating the course all declining world powers follow, that charted by Paul Kennedy (1988) in "The Rise and Fall of the Great Powers" and subsumed in his imperial overstretch thesis:

".....decision-makers in Washington must face the awkward and enduring fact that the sum total of the United States' global interests and obligations is nowadays far greater than the country's power to defend them all simultaneously" (Kennedy, 1988, p515).

Consequently, this leaves Japan as the only potential (future) world leader. Its claim to the hegemonic title is supported by the growth and development of the Pacific region; the liberally reformed giant of China; the prosperous and established states of Australia and New Zealand; the 'four tigers' (Taiwan, South Korea, Hong Kong, Singapore); and Malaysia, Indonesia, Thailand and the Philippines (Kennedy, 1988). Their emergence has seen;

"The center of world economic gravity [shift] rapidly towards Asia and the Pacific, as the Pacific takes its place as one of the key centers of world economic power" (Drysdale cited Kennedy, 1988, p441).

Of this region, Japan has been the undoubted economic powerhouse and hegemon for some time. However, its tremendous growth rate since 1970 has only recently seen it overtake the declining hegemon in a number of significant areas (Nester, 1990).

Figure 2 shows the growth of GNP per capita in Japan and the USA for the period 1972-92. Its most striking feature is the sudden and rapid increase in Japanese fortune in 1983. This saw it overtake the USA as the world's richest country in 1987, and the gap between the two countries continues to widen. By 1992 Japanese GNP per capita had jumped to US$28,190 whilst the USA average remained around US$23,000.

Figure 3 supports this data, showing how Japanese GDP average annual growth rates have outstripped US growth rates, with the exception of a few years, since 1972. By 1992 Japan's average annual growth rate stood at 4.1 per cent whilst the US languished around -1 per cent. A similar pattern is evident in figure 4 which displays balance of

payments for the same two countries, 1972-92. Once again, Japan has shown America the way forward, registering considerable trade surpluses compared to the USA's trade deficits. In 1992 Japan recorded its highest ever surplus, US$117.64 billion, whilst the US showed some improvement from its record low of US$163.4 billion deficit in 1987 to US$66.38 billion deficit by 1992.

It is statistics such as these that led to the Economic and Planning Agency in Tokyo hailing "[this] as indicative of the fact that Japan had become the richest nation in the world" (Pugh and Williams, 1990, p3).

However, such statistics do not tell the whole story. Most of the US trade deficit is held with Japan (Nester, 1990). A trade agreement between the two nations has been established whereby the US exports low value-added agricultural products and raw materials to Japan, who in return export high value-added technological products to the US: Williams (1991) remarked that in the past such a trade composite was the classic pattern of a colony (USA) with its mother country (Japan).

This picture is, perhaps, unsurprising considering Japan's unparalleled technological sophistication: a reflection, in part, of the vast sums of money spent on non-military research and development (R&D). Such expenditure has resulted in innovations, such as flexible technology (robotics, numerical machine-tools etc.), that have resulted in great cost advantages. Similarly, such expenditure has meant Japan has taken the lead in the search for a fifth generation computer which many people believe will cement it's (almost) hegemonic status (Rosecrance, 1986, Nester, 1990, Kuttner, 1991).

Additionally, strategic targetting of the service sector, combined with "an abundance of manpower with high-quality training in maths and science" (Vogel, 1986, p754) has caused massive growth in areas such as real estate, leisure, insurance and finance; an important development considering Bell's (1974) universally acknowledged thesis concerning "The Coming of [a] Post-Industrial Society". In fact, with regards financial services, Japan can now, justifiably, be considered a world leader (table 2)(Dicken, 1992).

However, the economic dominance of Japan has been reached at the expense of significant growth in military power capabilities. In this field the US maintains its hegemonic role, and Japan is quite happy for it to remain that way (Nester, 1990). Kurian (1991), tabulating 'military expenditure as a percentage of GNP', recently ranked Japan 126th out of 136 nations. Spending an average of 1 per cent of GDP on the military means that Japan is in the company of Barbados and Trinidad and Tobago at the foot of the table (Maull, 1990, Kurian, 1991). Consequently, in a table of 'most powerful military nations', Japan is ranked 17th out of 50 (Kurian, 1991). Such nominal expenditure on military capabilities is the result of a US-Japan security agreement and "[its] protection under the NATO nuclear umbrella" (Kanjirathinkal and Hickey, 1992, p21; Deger and Sen, 1990).

JAPAN: AN UNCONVENTIONAL HEGEMON?

However, despite such agreements, the fact remains that although Japan is very strong economically, it is very weak militarily. Since proponents of cyclical international relations have all linked previous cases of world leadership with military capability, can Japan justifiably be considered the most likely candidate for hegemonic status? Before answering this it is, perhaps, necessary to briefly examine the importance of the military in the post-1989 new world order.

Authors such as Rosecrance (1986), Nester (1990), Deger and Sen (1990) and Cohen (1991) have all predicted that the role the military plays is to enter relative decline in the future. In support of their theory examples such as the arms control talks between the (ex-) superpowers, the discussions for reducing the flow of arms to the Middle East and the dissolution of the Warsaw Pact are all cited. Additionally, their theories are empirically supported with the end of armed conflict in Angola, Cambodia, Ethiopia, Namibia, South Africa and (hopefully) Northern Ireland, as well as between Iran-Iraq and Israel-PLO (Cohen, 1991). Furthermore, the decision by many states to reduce military expenditure is also testimony to its widely regarded decline; all the historically great military powers (USA, USSR, UK, Germany, France etc.) are experiencing cutbacks (Deger and Sen, 1990).

Perhaps one of the major reasons for decline is the removal of the predominant impetus for expansionary activity, economic independence. Rosecrance (1986) states that:

"In the world economy of the 1990s.....it would be much more difficult to conquer territories containing sufficient oil, natural resources, and grain supplies to emancipate their holder from the restraints of the interdependent economic system.....For states in North America, Western Europe or East Asia, the required program of conquest is simply beyond their means. Such an aggressor would need the oil of the Middle East, the resources of Southern Africa, and the grain and iron of Australia, Canada and the American Middle West. Too much dependence and too little strength exist to make that list achievable" (Rosecrance, 1986, p123).

This quotation also highlights another issue useful in explaining the declining importance of the military: interdependence in the world economy. Fostering economic interdependence to quell potential threats has been a strategy utilised effectively by politicians for hundreds of years. However, probably the most successful example is the European Union (Rosecrance, 1986);

"The European Economic Community was created above all to prevent [another] confrontation between France and Germany. The objective was to enmesh nation states - initially France, Germany, Italy, Belgium, Netherlands and Luxembourg - in a web of economic and trading links that made conflict between them too expensive to contemplate" (Tindale and Miliband, 1991, p5).

Suffice it to say that so far it has worked.

Now, in 1995, with the telecommunication revolution and voluminous economic and trading links, a globally interdependent situation akin to the EU has been created. Phenomena such as time-space convergence (Dicken and Lloyd, 1992) and the new international division of labour associated with the internationalisation/globalisation of production (Dicken, 1992), have caused a great amount of economic interpenetration and thus interdependence (Rosecrance, 1986). The ultimate vehicle for this sort of dependency is the multinational corporation (MNC) which is "now knitting the world together economically and socially" (Cohen, 1991, p554; Thrift and Taylor, 1989, Dicken, 1992).

Consequently, the frequency and intensity of conflict is likely to gradually diminish as interdependence proceeds at an increasingly rapid rate. In other words, military activity is likely to become more and more subordinated to economic processes and strategies.

Luttwak (1990, cited OTuathail, 1992) already believes this to be the case. He argues that methods of commerce are displacing military methods in international relations; disposable capital is assuming a greater importance than firepower; civilian innovation is more significant than military-technical advancement; and market penetration is a better mark of power than the possession of foreign garrisons and bases (Luttwak, ibid.). In this sense, geo-economics is replacing geopolitics on the globl political arena (OTuathail, 1992).

But what if these theories and assumptions are wrong and military power does still influence the 'selection' of new world leaders? If this was the case then the future hegemon, regarding the current expenditure trends, may well be the nation that could rapidly produce high-quantities of weaponry in the shortest space of time. However, two important ingredients are required to assemble a convincing military force: capital and technology (Deger and Sen, 1991). As Kennedy (1988) states;

"The world did not need to wait until Engel's time to learn that nothing is more dependent on economic conditions than.....the army and the navy. It was as clear to a Renaissance prince as it is to the Pentagon today,..... military power rests upon adequate supplies of wealth, which in turn derive from a flourishing productive base, from healthy finances, and from superior technology" (Kennedy, 1988, p439).

Thus, even if economic interdependence does not subjugate military activity, military prowess ultimately rests upon economic grounds.

Returning then to the initial question: can Japan be considered a future world leader even though it is economically strong and militarily weak? The answer appears to be that it can; the nature of the new world order is such that it appears economic, rather than military, strength is the prerequisite for hegemony. And Japan's economic preponderance has never been in doubt.

Its closest competitior, the USA, still has a very substantial economy but this is an economy which appears to be suffering a terminal downturn and will consequently be no match for the rapidly expanding economy of Japan. Additionally, the structure of both economies is such that the post-industrial future strongly favours the Japanese who have taken a strong leadership in electronic, telecommunication, semiconductor, supercomputer and finance (etc) fields.

As Vogel (1986) observes, a Pax Nipponica appears to be just around the corner.

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