At the start of 2011, the world is faced with a nine-year war in Afghanistan, debates over whether to contain or cooperate with a rising China, nuclear proliferation threats in North Korea and Iran, acute economic concerns, and an evolving terrorist threat ten years after 9/11. Jessica Mathews details the issues that will define the next twelve months and analyzes major challenges in a world where emerging powers are beginning to alter the global balance of power.



What are the major issues likely to define international affairs in 2011?

The ongoing war in Afghanistan, rising China, and continuing economic turmoil will be the major challenges for this.

In Afghanistan, we’re likely going to see a lull in fighting during the harsh winter, but violence will pick back up. Washington’s strategy is based on making the Taliban weaker and Afghan government stronger, but the situation on the ground is the reverse—the Taliban are getting stronger and the government is getting weaker. This will be a tougher and tougher problem. As members of the coalition leave, the United States will have to pick up more of the slack. Despite talk of a drawdown, this reality may mean instead that there is a request for more funds and forces.

The next major issue is China and whether Beijing’s aggressive political, economic, and military behavior displayed in recent months continues. The upcoming summit with President Hu and President Obama in Washington is critical. During his visit later this month, we will see, in particular, whether the Chinese are willing to take a more serious attitude toward North Korea’s provocative outbursts.

The third issue—and possibly the most important—is the international economy and whether we can initiate a coordinated set of policies to get back to higher growth. Europe’s ability to deal with its own problem is critical, as is the ability of the United States to stimulate growth domestically.


Will political opposition at home curtail President Obama’s ability to project power abroad?

There’s no question that the results of the November election have already hurt President Obama, but it’s not something that can be precisely measured and now it has been confused by several victories—especially New START—in the lame duck session. It’s apparent when you travel abroad—the international community perceives Obama’s influence differently. But far more than Obama’s political loss at home, it’s the country’s failure to deal with its economic problems that makes the United States weaker. 

People around the world are shaking their heads at America’s seeming inability to grapple with its biggest problems. While it’s not something that can be measured, it’s very real. If the United States is able to take additional steps to put the economy on a more solid footing with both higher growth and deficit reduction, America’s global power can be renewed and enhanced. 


Will the United States move to contain or cooperate with China?

The United States has already started partnering with an emerging power that shares a long border with China as it moves to open a special relationship with India. The biggest motivation for Washington’s engagement with New Delhi—even though it’s not talked about—is the hope that India can help balance China’s rising power.

But the ultimate answer of whether the United States will try to contain or cooperate with China is mostly up to Beijing. One year ago, Washington was looking at the Sino-American relationship very differently and more positively.

In 2010, the world witnessed a series of moves by China that seemed to suggest a 180-degree turn—certainly in tone, but also in real political choices. China’s assertiveness in the South China Sea and its bullying behavior after the Japanese arrested a Chinese trawler captain in disputed waters in the East China Sea were particularly notable.

Most importantly, China has been totally unwilling to deal with North Korea’s provocative behavior. This was clear both after Pyongyang was implicated in the sinking of the Cheonan, a South Korean warship, and more recently when tensions flared on the Korean peninsula after North Korea carried out a deadly artillery attack on a South Korean island in November. China is not stepping up to its responsibility. It will need to—soon.


Will 2011 be the beginning of the end of the war in Afghanistan?

At best, the coalition will be in a holding pattern in Afghanistan in the new year. If there is any drawdown of U.S. troops it will be largely symbolic, just as the Pentagon has said in the past. The more likely scenario is that the United States will find itself immersed in a war where more of its coalition partners will be leaving and the situation on the ground is not improving. 

Despite this reality, as Washington begins to look ahead to the presidential election in 2012, no one will want to bring the war front and center. Unfortunately, there will likely be little U.S. public attention paid to Afghanistan in 2011, even though it should be a priority. 


What is the state of global terror as we approach the 10th anniversary of 9/11?

Diffuse. Whereas Afghanistan was the heart of global terror ten years ago, it isn’t today. In many ways, it’s much harder to deal with the threat when terrorists are operating out of 15 or 20 countries, rather than a small handful. And there are countries like Yemen that offer a welcoming environment for terrorists to operate and are increasingly states of concern. And in this new environment, the war in Afghanistan still produces a jihadist recruiting message.

On the other hand, terrorists linked to al-Qaeda have been unable to carry out a major attack in this period. This is a testament to the effectiveness of Western intelligence and military action against militants around the world.

Still, al-Qaeda is a quick learner and the threat of terrorism looms large. It’s not easy to do a scorecard: in some ways global terrorists have been significantly weakened and in some ways, by broadening their base of operations and becoming less centralized in their decision-making, they have gotten stronger.


Is there any hope for the Middle East peace process?

This is one area where U.S. policy is inexplicable. When the latest round of direct talks started with the end of the Israeli settlement moratorium looming three weeks away, it seemed a given that Washington had some kind of deal with Israel in the bag. There was no way to imagine that negotiations would proceed far enough in 21 days to change the need for Israel to halt settlement building for talks to proceed. So when it turned out that there wasn’t a deal in place, it was incredibly surprising.  

The recent deal that was offered to the Israeli government to freeze construction of Jewish settlements for an additional 90 days seemed to compound the error. The fact that it fell apart is a good thing. It’s hard to understand what the U.S. administration was trying to do.

That said, it doesn’t appear that the Israeli government is ready to make the compromises necessary to pursue peace. And the Palestinians are too weak and divided. With this in mind, it’s hard to be optimistic.


How will the major powers deal with nuclear proliferation threats, particularly North Korea and Iran?

The situation in North Korea has already gone over the waterfall. It’s a nuclear state and the decision of whether or not to make trouble is largely in Pyongyang’s own hands. The international community needs to implement the tightest possible intelligence surveillance to thwart North Korea’s efforts to earn hard currency by selling nuclear technology and knowhow.

The world can at least hope that the provocative events of the last year are principally due to the Kim dynasty’s transition of power to a third generation. Aggressive behavior helps the new guy prove his toughness and ward off anyone who might take advantage of any uncertainty during a transition period. If so, this behavior may die down in 2011.

Iran is a different situation since it hasn’t passed the nuclear threshold yet. But one cannot be optimistic that Tehran can be stopped from acquiring nuclear weapons if it wants them.

In a paradoxical way, the Green Revolution's uprising eighteen months ago following illegitimate elections hurt the international community’s efforts. By weakening the government’s legitimacy so deeply, Iran was left with a government that is even less able to make compromises. Iranian leaders are not inclined that way to begin with, but they are now faced with a life and death political situation that prevents them from compromising.

Still, there is clear evidence that the sanctions are biting. The critical thing is to maintain unity within the P5+1. In the same way as when the permanent members of the UN Security Council were united against Saddam Hussein, he would back down. And every time the powers were divided, he would push Iraq in the wrong direction—Iran is the same.

The Obama administration deserves high marks for its diplomacy to get China, France, Germany, Russia, the United Kingdom, and the United States all on the same page. That’s a substantial achievement and if the tougher sanctions can be maintained, there’s still a chance.


Will Iraq’s young democracy begin to mature?

It’s been ten months since the parliamentary elections and we are only now seeing the formation of a new government. There is increasing unrest and this can’t go on indefinitely. There is still hope, however, that Iraq will stay in the relatively peaceful realm it has stayed in so far and move forward.


Will 2011 be a lost year for the fight against climate change?

Yes, it will likely be yet another lost year in the fight against climate change because the key impediment is the United States and there won’t be major national energy or climate goals enacted before the next presidential election.

The only thing that could change the political stalemate is if there is a large happening in the natural world that can be unequivocally attributed to global warming. In the same way that the completely unanticipated discovery of the Antarctic ozone hole led almost overnight to a treaty that called for a drastic cut in chlorofluorocarbons, such a development would change the political calculus. Something on this scale will probably be needed to scare countries into acting and the most likely global problems will come from rising sea levels and the melting of glaciers. Unless that happens, I’m not optimistic that we will see movement in the United States on a national level.

The other problem is whether cap and trade is the right method. My own feeling is that it’s not. The closer the United States gets to implementing cap and trade, the closer people look at the details. This causes an unholy alliance to form between people who don’t want to act on climate at all and the people who just don’t want to do cap and trade because they believe it’s the wrong idea. If these groups come together it’s not going to work.

It’s understandable why the climate community started to advocate cap and trade twenty years ago, because the political climate didn’t allow for a tax approach. But as George Soros discovered when he looked closely at the proposed legislation, the cap and trade system is too complex and therefore too easy to game.

The more complicated the system, the simpler the solution needs to be—the most attractive option is a high tax that is rebated on a per capita basis. No special benefits for renewable energy or anything else. It’s a progressive approach and, most importantly, it’s doable. People will both get the signal from higher prices at the pump that energy use matters and have the opportunity to change behavior and save lots of money. And even if they don’t change their energy use, they aren’t hurt as they will still receive the tax rebate.

There are answers to the problem, but we are some distance from having the political will to propel action.


With New START ratified in the United States, how strong will relations be between the United States and Russia in 2011?

The U.S.-Russian relationship, for all its imperfections and for all of Russia’s imperfections, is a major achievement of the Obama administration. When Obama came into office the bilateral relationship was the worst it had been since the low point in the Cold War—without question. Nothing positive was going on to offset the real controversies that exist.

That has changed. Obama made some tradeoffs, notably the location and type of missile defense program, that were very wise and have had positive results. Now the Bilateral Presidential Commission works on everything from energy to healthcare. The civil nuclear cooperation deal just went through and it’s a significant achievement. And most importantly, Russia has worked with the United States on Iran and supported tougher sanctions.

Not all of this would’ve gone down the drain if New START wasn’t approved, but the bilateral relationship would’ve been substantially hurt. New START calls for cuts in nuclear weapons that are significant but modest. The consequences if New START wasn’t ratified were immodest—they were huge. Failure would’ve meant that the world couldn’t begin to go down the path that New START opens, including looking at tactical nuclear weapons in Europe and starting to talk again to non-nuclear states. But now, all of this is on the table.


Will Europe’s economic struggles threaten its influence on critical global challenges?

Economic struggles threaten any nation’s global influence and Europe is no exception. The European Union will be forced to look inward to grapple with its own economic crisis, rather than look outward to take international initiative.

It becomes a question of how deep the crisis goes and whether countries can act on the difficulties they are confronting without one of two main economic tools at their disposal. The current arrangement—monetary union without fiscal union—will continue to be a problem, so both monetary and fiscal policies will probably need to be brought under the same hood.


Will it be a tough year for the global economy? Is there a danger that a currency or trade war could break out?

People felt that the threat in 2010 was enormous and that we would see tit for tat trade sanctions and barriers—but we didn’t. This is partially because the world remembers how devastating that was during the period between the two world wars.

The most acute issue is China’s exchange rate policy and tensions over the undervalued renminbi. China needs to increase domestic consumption and reduce its reliance on exports, but the question is whether this can happen quickly enough to take the pressure off the currency. China will need to rebalance its economy because the world can’t sustain that surplus.


How will emerging powers shape global affairs? Is the balance of power shifting?

The degree to which things have changed in just a few years is extraordinary. You can no longer talk about developed and developing countries and make sense of international affairs. Even in the last couple of years, new players that never would’ve taken major initiatives before are beginning to take firm stands on critical issues, although sometimes without adequate seriousness or deep knowledge of the issues.

The world is entering a messy and uncertain transitional period. It’s less clear what the rules are or who should play what role. And new organizational arrangements need to be worked out.

The initial success of the G20 in the midst of the economic crisis was a big achievement, but the progress since the first major steps has been disappointing, to say the least. And it’s still not entirely clear who should have a seat at the table. For the global economy, a major question is what group ought to be the global decision making body. If it’s not the G20, what is it? If it is, how does the G20 need to change to become effective?

These questions are echoed on all critical international issues. The same questions apply to climate. It’s impossible to negotiate an agreement with 200 countries in the room and there are really only fourteen that matter in terms of emissions. Actually, you could say that all you need is China and the United States or even more simply just the United States, which unfortunately still means 60 senators. That’s hard enough. Once America is ready to act, everything changes.

So, on almost any issue, questions about who belongs at the table, what institution should take the lead, and what are the rules are all up in the air. This is happening as we face a new phenomenon where countries are rich, but on a per capita basis the people are poor. That’s a new deal. And we don’t even have a good term for such a country—like China. We need to develop new ways to think and treat these emerging powers.

To confront global challenges in 2011 it will be important to understand how much has changed and the extent to which the center of gravity in global power has shifted.