Much has been said about Chimerica until it has turned out to be a chimera. Then the hybridization shifted to Europe to weave tales of Chermany. China has become a negative externality for the post-war allies. The United States and Europe are each trying to unload it onto each other, fearing the fire of the dragon. So, enters IndUS. The roiling waters of the Yangtze are finally redirecting America’s attention to the parched patch of the Indus.
The realpolitical anxiety of the Obama administration, after the United States has festered the China issue for nearly a decade, is to urgently make friends in its neighborhood to balance China without giving away much: the United States still does not want to offend China by recognizing India as the anchor of South Asia that stretches from the Afghan border and across Kashmir in the north and north west to the Bay of Bengal in the east and south into Sri Lanka. America wants to preserve its geopolitical flexibility by continuing to follow a bilateral and yet an isolationist policy with India, a legacy of Nixon and Kissinger.
The dysfunction in American foreign policy of seeing, on net, China as the Asian anchor for the last 40 years has largely been due to the dislike of Russia and India’s policy of non-alignment during the Cold War while veering toward the former Soviet Union. More overarchingly, it has to do with the dislike of Anglo-American conservatives of the post-war success of peaceful independence movements in India and South Africa that had gravely undermined the civilizational agenda of Winston Churchill and the belief in the United States in capitalism, albeit its tendency to continue to favor the winners, predicating cycles in income disparity entirely on the self-interest of the wealthy. China turned out to be a winner by default, having coopted the United States during the Cold War.
For the West, the Churchillian civilizational battle would be more difficult to win with India than with the more mercantilist China whose materialism is rooted in a diffuse tradition of faith having been assaulted by the Maoist Cultural Revolution, whereas India’s materialism is rooted in its long, uninterrupted spiritual tradition, dating back to coexistence with Egypt, that had weathered crises which arose within and without India, in both faith and geopolitics, a balance which the Judeo-Christian West is yet to discover, making the battle one-sided, entirely from the side of the West: every civilization of consequence had marched through the subcontinent over millennia only to be assimilated in the spirit of coexistence or expelled politely. The current excursion of G8-Perm5 globalization into India is simply another blip in that long history of civilization itself, from Harappa to Harrod’s, for India’s “protectionism” is inclusive and all encompassing.
The expectations of the United States’ emerging trade relationship with India must therefore be rooted in reality. Timothy Geithner, still wielding the saber of the Asian Crisis, cannot expect to take down the last bastion of Asia while saving the four decades long American geopolitical investment in China as if transacting the assurance of Chinese hegemony in Asia in exchange for China’s cooperation with the United States.
Geithner cannot expect India to naively give in to the lure of foreign investment in India’s domestic infrastructure and the burgeoning alternative energy sector only to treat it like Thailand a decade later. India will not and should not relax its controls on the movements of foreign capital until it gets reciprocal entrée into the G8 markets. There is no geopolitical reason for India to stand back because it can lead change in the 21st century as a democratic country in the absence of American political will to do so, and yes, along with China and Russia in Eurasia on one hand and with Europe on the other, ensuring the growth of Eurasia (including access to the Indian market to the United Kingdom, France and Germany, given the healthy reciprocity), especially given that the vision of Europe for the European Union (EU), across its multiple languages and cultures, is to become India, leaving the Americas to their own devices ― socially, economically and politically. In fact, a better model for both China and India to adopt in their economic evolution is Franco-German.
The economics of a market of 1.5 billion people by 2050 that does not face the same political challenges as China provides sufficient scale for U.S, E.U and India multinationals to co-exist mutually gainfully in the democratic sphere of the world. If China liberalizes politically, the resulting scale would be a staggering market size of about 5 billion people. By contrast, today’s global economic output of $65 trillion comes from a market of about a mere 1 billion spread across the G7 whose economic ideology, since the end of the Cold War, which Geithner personifies, is to grow at the expense of the potential 4 billion that could be more gainfully added to the global economy.
The David v. Goliath ideology of 1 billion v. 4 billion is a myth. The slingshot could boomerang if David turns out to be the 4 billion, which it most likely will. It is high time the post-war Harry Truman West becomes realistic about the realities of the emerging global economy.