Superpowers - EQ3 - 7.9 Flashcards
Why did the 2007-8 US finacial crisis go global
It rapidly spread around the world as so many countries are dependent on the US as a trade partner
Briefly explain how the US stock market crash happened
- Prior to 2007 there were low interest rates and many borrowers took the opportunity to take out loans, with sub-prime lending by USwith banks
- In 2006 house prices fell and the borrowers owed more on their homes than they were worth
- Interest rates increased and many people could no longer afford the repayments
- This meant that the banks and lenders went out of business
- In 2008 Lehman Brothers bank filed for bankruptcy this led to the stock markets and price of oil falling
- Governments around the world tried to bailout the banks and prevent the collapse of the banking system
How did the UK government step in when the US finanical crisis happened
- Lloyds bank and RBS were given government funds to prevent their collapse, Northern Rock and Bradford & Bingley were nationalised
- It is estimated that these interventions cost £137 billion significantly increasing the UK’s debt
By 2016 debt levels had reached …% of annual GDP in the UK, …% in the USA and …..% in Japan.
- By 2016 debt levels had reached 90% of annual GDP in the UK, 75% in the USA and 214% in Japan
Why did government debt levels sharply increase
- re-finance banks and other businesses facing collapse
- pay social service costs, such as unemployment benefits
- pay for new infrastructure (roads, bridges) in an effort to stimulate economic growth
How did the US government react to the US financial crisis
- icnreasingnational devt to maintain consumer spending and an economic multiplier effect
How did centre right parties in the UK & Germany deal with the US financial crisis
- austerity - to reduce govt spending & debt
- this increased unemployemnt & govt spending was cut, which led to social tensions & divisions
The USA and EU face ongoing economic challenges, these include:
- Debt
- Economic restructuring
- Unemployment
- Social costs
Define economic restructuring
There are two aspects to economic restructuring:
* The global shift of manufacturing to emerging and developing countries
* The shift in employment in developed countries to tertiary and quaternary economic sectors
How can economic restructuring effect superpower status
- deindustrialisation which causes:
- the rise of populist politicians
an increase in unemployment in traditional manufacturing areas such as South Wales and the North-West of the UK - a spiral of decline (negative multiplier effect) where people leave the area, so services and quality of life decrease so more people leave
- a need for investment in these areas to attract new businesses and jobs, this places increased financial pressure on the government
what is the effect on superpower status of structural unemployment
- Loss of manufaccturing secondary jobs to emerging economies through globalisation
- This has led to a pool of middle-aged, low-skilled, male workers without jobs
- Many rely on social security payments from the government
- Less disposable income, lower purchasing power
- Many TNCs now owned by emerging countries so secondary sector workers rely on decisions abroad
What is the effect on superpower status of debt
- Cost of interest – either impose austerity measures (economic brake) or risk getting into more debt
- Increasing reliance on investment from emerging superpowers, weakening their position
- & reduction in public spending to cut debt to prevent FDI being dettered
What is the effect of social costs on superpower status
- increase in inequality leads to social exclusion e.g. deteriorating employment networks / decaying living environment
- An increase in people with mental health problems
- A decrease in quality of life
- An increase in migration from the area
- An increase in crime and vandalism
What is the effect of additional social costs on the superpower status on the EU & US
- Rising life expectancy and low fertility rates mean an ageing population
- Care home, nursing care and pension costs are all rising
- This has to be paid for by a shrinking working-age population in many EU countries
Define austerity
- It is a political-economic term referring to policies that aim to reduce government budget deficits through spending cuts, tax increases, or a combination of both
- Austerity measures are used by governments that find it difficult to pay their debts.
Define military expenditure
- a military expenditure, is the amount of financial resources dedicated by a nation to raising and maintaining an armed forces or other methods essential for defence purposes
What is the advantage of these ongoing economic problems for emerging superpowers
- High debt levels, economic restructuring and high social costs represent an opportunity for India and China
- The two emerging powers have a chance to pull level with the USA and EU because of the ongoing and long-term nature of these economic and social problems
additional UK social costs has led the UK, France and other countries to…
increase the state retirement age in a bid to reduce costs
What did the UK do to its town councils
- major funding cuts reducing their ability to provide social care, healthcare & to fund community projects
A key part of being a superpower or emerging power is ……. strength
A key part of being a superpower or emerging power is military strength
How much did the US spend on defence spending in 2021, and what % is that of the governmnet budget
- $801 billion
- 10%
Give 2 political challenged the EU faces
- Tensions between countries wanting deeper union (France, Germany) and those wanting less have grown (UK has left – Sweden/Denmark outside Euro zone)
- Energy security is a key EU issue as it relies on imported oil and gas - Russia
EU unemployment was close to ….% in 2016 representing a cost to…
- 10%
- taxpayers and underused economic capacity
The EU is ageing ……, by 2012 ….% of EU citizens will be over 65.
The EU is ageing fast, by 2012 20% of EU citizens will be over 65.
The EU’s workforce will drop by …..% by 2030 which will place an increasing burden on….
The EU’s workforce will drop by 14% by 2030 which will place an increasing burden on those in work to find pensions, healthcare and care homes.
The UK had the world’s ……… largest defence budget in 2017 (……….. billion) but that was only …..% of the US defence budget.
The UK had the world’s fifth largest defence budget in 2017 (346 billion) but that was only 10% of the US defence budget.
What are the 5 ways global military power can be maintained
Naval power
Nuclear weapons
Air power
Intelligence Services
Space exploration
What are the costs of naval power
- advances in land based missile technology have made aircraft carriers vulnerable to attack
- High costs to build large quantities of vessels.
- Larger vessels have the disadvantage of requiring deep-water ports and access channels > may require infrastructure upgrades.
What are the benefits of naval power
- Can be highly strategic - e.g. aircraft carriers allow for ‘mobile airbases’ to be established in close proximity to most locations - military dominance can be projected anywhere
- Provides a moveable deterrent - overt form of hard power.
- Multi-use vessels allow for the military to adapt to situations as they arise > tackling drugs, humanitarian aid, anti-piracy operations, etc.
Reputation of the Royal Navy is high and well respected globally.
What are the costs of nuclear weaponsair power
-Costs of maintaining Trident is considerable (vessels to carry missiles, ensuring safety and decommissioning) - estimated £100 billion to replace
- Many would argue that money could be spent on other things > reduces investment in areas such as healthcare, social care, welfare system, etc.
What are the benefits of nuclear weapons
- Overt sign of ‘hard power’ - exclusive to a small number of countries, relatively speaking.
- A huge military deterrent to other nations, because pf the potential consequence of nuclear retalliation
What are the costs of air power
- drones are more affordable than planes, making air dominance harder because poorer countries can affort them too
- Significant costs of purchasing and maintaining aircraft - second to nuclear.
- Requires additional infrastructure to support missions (airfields, aircraft carriers, etc.)
What are the benefits of air power
- Allows for a quick response to situations (defence, attack, reconnaissance, etc.)
- drones are increasingly precise and used for search & destroy missions
- In-air refuelling now means that everywhere is easily accessible.
- Reputation of the RAF is high and well respected globally
What are the costs of intelligence services
- The volume of intelligence collected is more than that can be procesed - 9/11 terror attacks not picked up in time
- Labour and time intensive > monetary costs are high.
- Trying to keep ‘one step ahead’ can be difficult - especially with cyber and technological attacks
What are the benefits of intelligence services
- Advance intelligence hopefully prevents incidents from occurring in the first place- more ‘proactive’ than ‘reactive’ to situations.
- Many intelligence services share information, making those nations even more robust when it comes to tackling terrorism, cyber-attacks, etc. (e.g. FBI, Interpol, MI5, GCHQ, etc.)
What are the costs of space exploration
- Costs can be extremely high, and might be considered unnecessary by some (money could be spent on dealing with problems on earth’ type of ideas)
What are the benefits of space exploration
- Research carried out on board the ISS has allowed for many technological and health advancements on Earth
- Research in to atmospheric systems and climate change are accellerated by space technology
- GIS, global communications, meteorological systems all rely on space infrastructure
- Jobs created in space industries is high in the UK - particularly satellite development and GIS services
Although the UK does not have its own …………. programme, it is involved in the …………
Although the UK does not have its own active space programme, it is involved in the European Space Agency’s work.
Describe European naval power recently
- The UK has significantly decreased the Naval fleet since the 1950s but in 2020 Boris Johnson announced the intention to
- ‘to restore Britain’s position as the foremost naval power in Europe’
- European naval forces have decreased by approximately 32% since 1999
- The reduction in naval forces have been due to successive governments attempts to reduce costs
What does NATOs nuclear deterrence policy states that the weapons are there to do
‘preserve peace, prevent coercion and deter aggression’
how many nuclear powers are there currently
9
US Air Force spending has increased from $…. billion in 2011 to $…. billion in 2022
US Air Force spending has increased from $164 billion in 2011 to $222 billion in 2022
Much of the recent military focus has been on air power rather than naval power due to……
In 2021 the UK announced £ ….. million investment in new helicopters and transport aircraft
the speed of response
700
In 2021 it was announced the UK intelligence services would have a £… billion increase in 2024/25
0.7
intelligence services alone cost $… billion annually for the US
80
Describe US Space exploration
- The US has by far the greatest expenditure on space exploration
- The cost of NASA’s new Artemis mission is predicted to be $93 billion up to 2025
Why is the amounts of money spent on maintaining global military power in US & the EU increasingly being questioned
- One argument is that the focus of global influence is now on ‘soft powers’ and the relevance of the military is reduced
- A second argument is that the money would be better spent on reducing poverty, infrastructure and healthcare rather than on ‘hard power’
Why is such high military spending questionable for the US
- about 13% of Americans live in poverty (living on less than $12,000 per year)
- about 60,000 road and rail bridged in the USA need to be repaired
- the over 65s in the USA made up 15% of the population in 2016, this will rise to 20% by 2030
Why has a rapid shift in global balance of power occurred since the end of the cold war
- The number of emerging nations have increased and hegemonic status of the US is not certain in the future
- The US is still dominant in terms of economic and military power, its soft powers are not as influential as in the past
how can we predict future power balances
Future outcomes cannot be known, but estimates are made based on extrapolating past and current trends, especially total GDP levels and populations.
Why is it difficult to predict future superpowers
- Post-Brexit, and faced with a sluggish economy and huge debts, what is the future of the EU? It may stagnate as the Japanese economy has done since the mid-1990s, or renew itself and grow.
- Russia, with its oil and gas reserves and huge military arsenal (including nuclear weapons), will remain important, but is an unlikely global leader - Russia/Ukraine
- The EU, Russia and even China all face the prospects of rapidly ageing populations that may diminish their status.
What are 3 possible future scenarios for the world
- Uni-polar - the USA remains the single, dominant global hegemon
- Bi-polar - China draws level with the USA
- Multi-polar (regional mosaic) - the USA and EU decline relative to increasingly powerful bricks
What will China be like superpower wise in 2030
- China has also announced plans to modernise China’s military by 2035
- The use of soft power is also an area that China is increasingly focussed on, promoting Chinese language, educational exchanges and the expansion of the media
- It is unlikely that China will yet have the political and cultural influence to challenge the hegemonic status of the US
What is China’s economy expected to be like by 2030
- A similar world to today, but the Chinese economy is likely to be similar in size to that of the USA
- Per capita incomes in China will be lower than the USA, and China will still be in the process of becoming a fully developed country
What is 2050 expected to look like
- Potentially a very different world, with China and India both powerful economically and militarily (and potential rivals)
- The USA could have similar levels of power and influence to India and China
Under what circumstances would the US remain the hegemon
- Japan’s rapid economic growth after the Second World War led many experts to predict that Japan would overtake the USA in the 1980s.
- However, a deep recession in the 1990s slowed Japan’s growth and led to the world’s largest national debt.
- An economic crisis in China or all Asia would slow the growth of emerging powers and keep a uni-polar power situation: a dominant USA.
Under what circumstances would it be a bipolar world
- A bi-polar power structure would see the return of a superpower balance between the USA and China initially, and then perhaps between China and India.
- The close economic ties between the USA and China would make this a very different bi-polar situation from the Cold War.
- However, China’s claims to territories in the South China Sea on the one hand, and the USA’s trade war with China on the other, increase the risk of bi-polar conflict.
Under what circumstances would it be a multipolar world
- President Trump’s call to “Make America Great Again’ is based on the view that the USA has lost power in the world.
- At the same time, emerging powers such as China face challenges in moving from regional powers to superpowers. For example, China faces challenges of an aging population, managing the transition from a low-wage to a high-wage economy, and reducing inequality.
What trend regarding the concentration of military expenditure was noted by SIPRI?
SIPRI observed that military spending is highly concentrated; the top 15 countries account for over 81% of the total.
How did the global financial crisis of 2008 affect military spending?
Although many nations cut back on public spending during the crisis, military expenditure generally continued to rise, with 2012 marking only a small decrease.
China was …… highest at estimated US$…. billion for military spending
China was second highest at estimated US$293 billion
What strategic reasons are given for maintaining or increasing military spending during economic downturns?
Major powers, such as the USA, Brazil, China, Russia, and India, view sustained military spending as essential for maintaining global and regional influence, regardless of economic challenges.
How does the United Nations’ budget compare to global military spending?
The UN and its agencies spend around $30 billion per year (about $4 per person), which is less than 3% of global military expenditure.
What proportion of the global economy is said to be dependent on violence, and what does this imply?
Approximately $2.4 trillion, or 4.4% of the global economy, is dependent on industries related to violence (the defense industry), highlighting the economic impact of military spending.
What discrepancy did SIPRI note regarding national priorities in spending?
a large gap between spending on military capabilities to maintain power and allocations for alleviating poverty or promoting economic development
What unique power does the EU possess despite its limited military divisions?
- The EU controls the world’s largest market and one of the biggest central banks, giving it unmatched commercial power
