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Governance: An international journal of policy, administration and institutions

Reply to Coen and Pegram: The global liberal system is more fragile than you think

TiberghienYves Tiberghien replies to a commentary on global governance research by David Coen and Tom Pegram: David Coen and Tom Pegram are right on two counts: our current global governance system is not working and our current theories of global governance are too fragmented to help us analyze the situation and suggest improvements. Yet, the problem is even more serious than what they describe. In fact, the current combination of systemic risks, dramatic power shift, and entropic forces facing our existing global governance architecture could well overwhelm it. And we could well miss it until it is too late.

Theories of international relations tend to treat cases of global governance change (be they in the trade, finance, climate, health, development, or scientific fields) as distinct games. They often focus on incremental gains at the Pareto frontier. The post-war liberal order is considered to be mostly resilient (Ikenberry 2011). If we were on the brink of a systemic change, would we know it?

Our current global liberal order is increasingly rocked by tremors that could signal much greater change ahead. We have likely entered a period of uncertainty, non-linear change, and historic transition.

Indeed, our current period is characterized by the combination of three types of uncertainties. First, the existing institutions of global governance are proving increasingly inadequate to sustain current levels of globalization and systemic risks (Goldin 2013; Hale et al. 2013). Global markets are “weakly embedded” (Rodrik 2011:xvi) and their legitimacy is eroding. In the words of Economic Nobel Prize winner, Michael Spence, “The scope and depth of the interdependencies of the global economy have run well ahead of global governance structure. (…) This mismatch between governance and the market creates, at the very least, tensions” (Spence 2011:244-245).  Our current level of global connectivity requires upgrades in the global governance infrastructure.

Second, we are undergoing the greatest change in the balance of global power in a century. The combined GDP of China, India, and Brazil as a percentage of world GDP rose from about 5% in 1990 to about 20% in 2014 (in nominal $). China’s GDP represented 12% of the US GDP in 2000 and 60% in 2014. As a result, emerging nations have become more critical stakeholders in our global governance structure. They are demanding more voice but threatening exit otherwise (as in the case of the AIIB). Progress in global governance cannot be generated within G7 nations any longer, but requires tougher bargains between established powers and emerging powers. Ground zero is the China-US relationship. Emerging powers are less likely to trust Western-dominated private networks and NGOs.

Third, leaders in systematically important countries (US, China, EU, Japan, Brazil, and India) find themselves increasingly constrained by economic difficulties, volatile public opinion, and polarization. Nation states are gripped by rising inequality, diverging public opinions, and rising domestic nationalism. As shown in the US or Continental Europe, national democracy increasingly clashes with liberal institutionalism. Leaders have limited political autonomy and find it difficult to make credible commitments in global governance negotiations.

It is the combination of these three sets of forces that is leading to global governance failure. The different mechanisms of global coordination are not generating global institutional solutions to increasing public good needs and systemic risks, such as the growing climate crisis. Rising systemic entropy is eroding their effectiveness. Increased competition between eager emerging powers and reluctant established powers is leading to fragmentation of global regimes in trade, development, and investment.

In this context, our theories of global governance are still too focused on marginal changes within a stable game, when the resilience of the system itself is being tested. More research is needed on the conditions under which institutional competition can lead to mutual reinforcement, as opposed to paralysis or fragmentation. Under what conditions can innovations in one domain travel to another domain?

Conversely, when does fragmentation in one domain of global governance impact other domains? And when will certain domains remain relatively resilient? Under what conditions can investment into a public good oriented global governance process lead to domestic political gains? When can domestic political constraints in a systematically important state cripple global governance, instead of simply generating positive two-level gains in global negotiations?

Global governance is too important a domain to be left to IR theorists alone. Public policy research is not focused enough on the urgent requirements of global governance. Buttressing, expanding, and reforming the global governance regime is an urgent task if we wish to avoid the critical failure of the 1930s. We are still generating too few ideas and too little institutional innovation. We urgently need new blueprints and new designs that can nudge important players toward cooperation. Global governance entrepreneurs and global norm entrepreneurs are urgently needed. Otherwise, realists will have the last laugh. It won’t be a happy laugh.

Yves Tiberghien is an Associate Professor of Political Science, Director of the Institute of Asian Research, and co-Director of the Master of Public Policy and Global Affairs (MPPGA, http://mppga.ubc.ca) at the University of British Columbia. The MPPGA enables future leaders to operate at the frontier between domestic public policy and global governance. It incubates policy networks that connect Asian emerging powers with North America and Europe.

References:

Goldin, Ian. 2013. Divided Nations: Why global governance is failing, and what we can do about it. Oxford: Oxford University Press.

Hale, Thomas, David Held and Kevin Young. 2013. Gridlock: Why Global Cooperation Is Failing When We Need It Most. Cambridge: Polity Press.

Ikenberry, G. John. 2011. Liberal leviathan : the origins, crisis, and transformation of the American world order. Princeton, N.J.: Princeton University Press.

Rodrik, Dani. 2011. The Globalization Paradox : Democracy and the Future of the World Economy. New York: W. W. Norton & Co.

Spence, Michael. 2011. The Next Convergence: the Future of Economic Growth in a Multispeed World. New York: Picador – Farrar, Strauss, and Giroux.

Written by Governance

November 1, 2015 at 9:46 am

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