by Michael Finley

Is the global financial crisis a “bear market rally” in the decline of the state, or its resurgence?

I have this question for 4GW theorists.  I haven’t seen it adequately addressed anywhere, and it is of the greatest urgency.  Our understanding of the basic elements available to inform grand strategy turns on the answer to the question, and our knowledge of how to make grand strategy and strategy turns on the supporting analysis.

4GW detractors now trumpet the global crisis as the definitive stopper to facile talk of the demise of the state. Easy case to make, with the state nationalizing the upper tier of the American financial system and swaths of its industrial, commercial, and consumer economy, and similar actions by other OECD governments. The IMF and World Bank, discredited for years, are enjoying a resurgence of “relevance” to help protect or rescue emerging and frontier markets from the [also] reasserted contagion. The anti-4GW crowd take all this as proof that the democratic capitalist states and their multilateral institutions have become stronger than ever, and the only possible source of the strength to rescue the global economy.

On the other side of the argument from the OECD/Western establishment’s gloating, I sat this fall in a room with an African cabinet and heard one of its senior ministers state flatly that the crisis was proof of the demise of the global “Washington consensus” and any credibility for democratic capitalist systems, and clearly meant that developing nations must instead look to China and emulate its “one state, two systems” model. While, as the only American in the room, I felt obliged to point out that no man had ever made money selling America short over the long run, I can admit here that I did so with a nagging uncertainty that I might have been something like a publicist for Justinian and Theodora’s diminishing legions….

Someone with greater experience and capacity than mine should deal more thoroughly than I can with these criticisms, which come from both ends of the spectrum in advocacy for character and conduct of the polity.