Conclusion: The Rivals

Well, Sir Anthony, since you desire it, we will not anticipate the past! – So mind, young people – our retrospection be all to the future.

Sheridan

He felt that in the electric flame department of the infernal regions there should be a special gridiron, reserved exclusively for the man who invented these performances [amateur theatricals], so opposed to the true spirit of civilization.

P. G. Wodehouse

There is no better illustration of the life cycle of a civilization than The Course of Empire, a series of five paintings by Thomas Cole that hang in the gallery of the New York Historical Society. A founder of the Hudson River School and one of the pioneers of nineteenth-century American landscape painting, Cole beautifully captured a theory to which most people remain in thrall to this day: the theory of cycles of civilization.

Each of the five imagined scenes depicts the mouth of a great river beneath a rocky outcrop. In the first, The Savage State, a lush wilderness is populated by a handful of hunter-gatherers eking out a primitive existence at the break of a stormy dawn. The second picture, The Arcadian or Pastoral State, is of an agrarian idyll: the inhabitants have cleared the trees, planted fields and built an elegant Greek temple. The third and largest of the paintings is The Consummation of Empire. Now the landscape is covered by a magnificent marble entrepôt, while the contented farmer-philosophers of the previous tableau have been replaced by a throng of opulently clad merchants, proconsuls and citizen-consumers. It is midday in the life cycle. Then comes Destruction. The city is ablaze, its citizens fleeing an invading horde that rapes and pillages beneath a brooding evening sky. Finally, the moon rises over Desolation. There is not a living soul to be seen, only a few decaying columns and colonnades overgrown by briars and ivy.

Conceived in the mid-1830s, Cole’s pentaptych has a clear message: all civilizations, no matter how magnificent, are condemned to decline and fall. The implicit suggestion was that the young American republic of Cole’s age would do better to stick to its bucolic first principles and resist the temptations of commerce, conquest and colonization.

For centuries, historians, political theorists, anthropologists and the public at large have tended to think about the rise and fall of civilizations in such cyclical and gradual terms. In Book VI of Polybius’ Histories, which relate the rise of Rome, the process of political anacyclosis goes as follows:

1. Monarchy

2. Kingship

3. Tyranny

4. Aristocracy

5. Oligarchy

6. Democracy

7. Ochlocracy (mob rule)

This idea was revived in the Renaissance, when Polybius was rediscovered, and passed, meme-like, from the writing of Machiavelli to that of Montesquieu.1 But a cyclical view also arose quite separately in the writings of the fourteenth-century Arab historian Ibn Khaldun and in Ming Neo-Confucianism.2 In his book Scienza nuova (1725), the Italian philosopher Giambattista Vico describes all civilizations as passing through a ricorso with three phases: the divine, the heroic and the human or rational, which reverts back to the divine through what Vico called ‘the barbarism of reflection’. ‘The best instituted governments, like the best constituted animal bodies,’ wrote the British political philosopher Henry St John, Viscount Bolingbroke, in 1738, ‘carry in them the seeds of their destruction: and, though they grow and improve for a time, they will soon tend visibly to their dissolution. Every hour they live is an hour the less that they have to live.’3 In The Wealth of Nations Adam Smith conceived of economic growth – ‘opulence’ as he put it – ultimately giving way to the ‘stationary state’.

Idealists and materialists agreed on this one thing. For Hegel and Marx alike, it was the dialectic that gave history its unmistakable beat. History was seasonal for Oswald Spengler, the German historian, who wrote in The Decline of the West (1918–22) that the nineteenth century had been ‘the winter of the West, the victory of materialism and scepticism, of socialism, parliamentarianism, and money’. The British historian Arnold Toynbee’s twelve-volume Study of History (1936–54) posited a cycle of challenge, response by ‘creative minorities’, then decline – civilizational suicide – when leaders stop responding with sufficient creativity to the challenges they face. Another grand theory was that of the Russian émigré sociologist Pitrim Sorokin, who argued that all major civilizations passed through three phases: ‘ideational’ (in which reality is spiritual), ‘sensate’ (in which reality is material) and ‘idealistic’ (a synthesis of the two).4 The American historian Carroll Quigley taught his students at the Georgetown School of Foreign Service (among them the future President Bill Clinton) that civilizations had, like man, seven ages: mixture, gestation, expansion, conflict, universal empire, decay and invasion. It was, Quigley explained in a classic statement of the life-cycle theory:

a process of evolution … each civilization is born … and … enters a period of vigorous expansion, increasing its size and power … until gradually a crisis of organization appears. When this crisis has passed and the civilization been reorganized … its vigor and morale have weakened. It becomes stabilized and eventually stagnant. After a Golden Age of peace and prosperity, internal crises again arise. At this time there appears, for the first time, a moral and physical weakness, which raises … questions about the civilization’s ability to defend itself against external enemies … The civilization grows steadily weaker until it is submerged by outside enemies, and eventually disappears.5

Each of these models is different, but all share the assumption that history has rhythm.

Although hardly anyone reads Spengler, Toynbee or Sorokin today – Quigley is still enjoyed by conspiracy theorists* – similar strains of thought are legible in the work of more modern authors. Paul Kennedy’s The Rise and Fall of the Great Powers (1987) is another work of cyclical history, in which great powers rise and fall according to the growth rates of their industrial bases and the costs of their imperial commitments relative to their economies. Just as in Cole’s Course of Empire, imperial expansion carries the seeds of future decline. As Kennedy writes: ‘If a state overextends itself strategically … it runs the risk that the potential benefits from external expansion may be outweighed by the great expense of it all.’6 This phenomenon of ‘imperial overstretch’, he argues, is common to all great powers. When Kennedy’s book was published, many people in the United States shared his fear that their own country might be succumbing to this disease.

More recently, it is the anthropologist Jared Diamond who has captured the public imagination with a grand theory of rise and fall. His book, Collapse: How Societies Choose to Fail or Succeed (2005), is cyclical history for the Green Age: tales of societies, from seventeenth-century Easter Island to twenty-first-century China, that risked, or now risk, destroying themselves by abusing their natural environments. Diamond quotes John Lloyd Stevens, the American explorer and amateur archaeologist who discovered the eerily dead Mayan cities of Mexico: ‘Here were the remains of a cultivated, polished, and peculiar people, who had passed through all the stages incident to the rise and fall of nations, reached their golden age, and perished.’7 According to Diamond, the Maya fell into a classic Malthusian trap as their population grew larger than their fragile and inefficient agricultural system could support. More people meant more cultivation, but more cultivation meant deforestation, erosion, drought and soil exhaustion. The result was civil war over dwindling resources and, finally, collapse.

Diamond’s inference is of course that today’s world could go the way of the Maya.8 The critical point is that environmental suicide is a slow and protracted process. Unfortunately, political leaders in almost any society – primitive or sophisticated – have little incentive to address problems that are unlikely to manifest themselves for a hundred years or more. As the United Nations Climate Change Conference in Copenhagen in December 2009 made clear, rhetorical pleas to ‘save the planet’ for future generations are insufficient to overcome the conflicts over economic distribution between rich and poor countries that exist in the here and now. We love our grandchildren. But our great-great-grandchildren are harder to relate to.

Yet it is possible that this whole conceptual framework is, in fact, flawed. Perhaps Cole’s artistic representation of a civilizational supercycle of birth, growth and eventual death is a misrepresentation of the historical process. What if history is not cyclical and slow-moving but arrhythmic – sometimes almost stationary, but also capable of violent acceleration? What if historical time is less like the slow and predictable changing of the seasons and more like the elastic time of our dreams? Above all, what if collapse is not centuries in the making but strikes a civilization suddenly, like a thief in the night?

Civilizations, as I have endeavoured to show in this book, are highly complex systems, made up of a very large number of interacting components that are asymmetrically organized, so that their construction more closely resembles a Namibian termite mound than an Egyptian pyramid. They operate somewhere between order and disorder – on ‘the edge of chaos’, in the phrase of the computer scientist Christopher Langton. Such systems can appear to operate quite stably for some time, apparently in equilibrium, in reality constantly adapting. But there comes a moment when they ‘go critical’. A slight perturbation can set off a ‘phase transition’ from a benign equilibrium to a crisis – a single grain of sand causes an apparently stable sandcastle to fall in on itself.

To understand complexity, it is helpful to examine how natural scientists use the concept.9 Think of the spontaneous self-organization of half a million termites, which allows them to construct a complex mound, or the fractal geometry of the snowflakes formed by water molecules, with their myriad variants of sixfold symmetry. Human intelligence itself is a complex system, a product of the interaction of billions of neurons in the central nervous system – what the neuroscientist Charles Sherrington called the ‘enchanted loom’. Our immune system is also a complex system in which antibodies mobilize themselves to wage a defensive war against alien antigens. All complex systems in the natural world share certain characteristics. A small input to such a system can produce huge, often unanticipated changes – what scientists call ‘the amplifier effect’.10 Causal relationships are often non-linear, which means that traditional methods of generalizing from observations (such as trend analysis and sampling) are of little use. Indeed, some theorists would go so far as to say that certain complex systems are wholly non-deterministic, meaning that it is next to impossible to make predictions about their future behaviour based on past data. There is no such thing as a typical or average forest fire, for example. To use the jargon of modern physics, a forest before a fire is in a state of ‘self-organized criticality’; it is teetering on the verge of a breakdown, but the size of the breakdown is unknown, because the distribution of forest fires by magnitude does not follow the familiar bell curve, with most fires clustered around a mean value, the way most adult male heights are clustered around five foot nine. Rather, if you plot the size of fires against the frequency of their occurrence, you get a straight line. Will the next fire be tiny or huge, a bonfire or a conflagration? The most that can be said is that a forest fire twice as large as last year’s is roughly four (or six or eight, depending on the forest) times less likely to happen this year. This kind of pattern – known as a ‘power-law distribution’ – is remarkably common in the natural world. It can be seen not just in forest fires but also in earthquakes and epidemics. Only the steepness of the line varies.11

The political and economic structures made by humans share many of the features of complex systems. Indeed, heterodox economists such as W. Brian Arthur have been arguing along these lines for decades, going far beyond Adam Smith’s notion of an ‘Invisible Hand’, seeming to guide multiple profit-maximizing individuals, or Friedrich von Hayek’s later critique of economic planning and demand management.12 To Arthur, a complex economy is characterized by the interaction of dispersed agents, a lack of any central control, multiple levels of organization, continual adaptation, incessant creation of new market niches and no general equilibrium. In contradiction to the core prediction of classical economics that competition causes diminishing returns, in a complex economy increasing returns are quite possible. Viewed in this light, Silicon Valley is economic complexity in action; so is the internet itself. And the financial crisis that began in 2007 can also be explained in similar terms. As Nassim Taleb has argued, the global economy by the spring of 2007 had come to resemble an over-optimized electricity grid. The relatively small surge represented by defaults on subprime mortgages in the United States sufficed to tip the entire world economy into the financial equivalent of a blackout, which for a time threatened to cause a complete collapse of international trade.13 Researchers at the Santa Fe Institute are currently exploring how such insights can be applied to other aspects of collective human activity, including ‘metahistory’.14

This is less esoteric than it seems, since wars are even less normally distributed than financial crises. The physicist and meteorologist Lewis Fry Richardson* grouped ‘deadly quarrels’, ranging from homicides to world wars, according to their magnitudes, using the base-10 logarithm of the total number of deaths. Thus a terrorist act that kills 100 people has a magnitude of 2, while a war with a million victims is a magnitude-6 conflict. (Note that a war of magnitude 6 ± 0.5 could cause anywhere from 316,228 to 3,162,278 deaths.) Considering only the period from 1815 to 1945, Richardson found more than 300 conflicts of magnitude 2.5 or higher (in other words, responsible for upwards of 300 deaths). Of these, two magnitude-7 wars (the world wars) killed at least 36 million (60 per cent of the total), excluding victims of war-related famine or disease, and millions of magnitude-0 homicides (with one, two or three victims) claimed 9.7 million lives (16 per cent). These data appear at first sight to be completely random. But they, too, obey a power law.15

If the incidence of war is as unpredictable as the incidence of forest fires, the implications for any theory of the rise and fall of civilizations are immense, given the obvious causal role played by wars in both the ascent and descent of complex social organizations. A civilization is by definition a highly complex system. Whatever nominal central authority exists, in practice it is an adaptive network of dynamic economic, social and political relations. It is not surprising, then, that civilizations of all shapes and sizes exhibit many of the characteristics of complex systems in the natural world – including the tendency to move quite suddenly from stability to instability.

As we saw in the last chapter, Western civilization in its first incarnation – the Roman Empire – did not decline and fall sedately. It collapsed within a generation, tipped over the edge of chaos by barbarian invaders in the early fifth century. Comparably swift collapses have been a leitmotif of this book. In 1530 the Incas were the masters of all they surveyed from their lofty Andean cities. Within less than a decade, foreign invaders with horses, gunpowder and lethal diseases had smashed their empire to smithereens. The Ming dynasty’s rule in China also fell apart with extraordinary speed in the mid-seventeenth century. Again, the transition from equipoise to anarchy took little more than a decade. In much the same way, the Bourbon monarchy in France passed from triumph to terror with astonishing rapidity. French intervention on the side of the colonial rebels against British rule in North America in the 1770s seemed like a good idea at the time, but it served to push French finances into a critical state. The summoning of the Estates General in May 1789 unleashed a political chain reaction and a collapse of royal legitimacy so swift that within four years the King had been decapitated by guillotine, a device invented only in 1791. At the time of the Young Turk movement, which came to power in 1908, the Ottoman Empire still seemed capable of being reformed. By 1922, when the last Sultan of the Ottoman Empire departed Istanbul aboard a British warship, it was gone. Japan’s empire reached its maximum territorial extent in 1942, after Pearl Harbor. By 1945 it too was no more.

The sun set on the British Empire with comparable suddenness. In February 1945 Prime Minister Winston Churchill bestrode the world stage as one of the ‘Big Three’, deciding the fates of nations with US President Franklin Roosevelt and Soviet leader Joseph Stalin at Yalta. No sooner had the war ended than he was swept from office. Within a dozen years, the United Kingdom had conceded independence to Burma, Egypt, Ghana, India, Israel, Jordan, Malaya, Pakistan, Ceylon and Sudan. The Suez Crisis in 1956 proved that the United Kingdom could not act in defiance of the United States in the Middle East, setting the seal on the end of empire. Although it took until the 1960s for Harold Macmillan’s ‘wind of change’ to blow through sub-Saharan Africa and the remnants of colonial rule east of Suez, the United Kingdom’s age of hegemony was effectively over less than a dozen years after its victories over Germany and Japan.

The most recent and familiar example of precipitous decline is, of course, the collapse of the Soviet Union. With the benefit of hindsight, historians have traced all kinds of rot within the Soviet system back to the Brezhnev era and beyond. According to one recent account, it was only the high oil prices of the 1970s that ‘averted Armageddon’.16 But this was not apparent at the time. In March 1985, when Mikhail Gorbachev became general secretary of the Soviet Communist Party, the CIA (wrongly) estimated the Soviet economy to be approximately 60 per cent the size of the US economy. The Soviet nuclear arsenal was genuinely larger than the US stockpile. And governments in what was then called the Third World, from Vietnam to Nicaragua, had been tilting in the Soviets’ favour for most of the previous twenty years. Yet less than five years after Gorbachev took power, the Soviet imperium in Central and Eastern Europe had fallen apart, followed in 1991 by the Soviet Union itself. If ever an empire fell off a cliff – rather than gently declining – it was the one founded by Lenin.

If civilizations are complex systems that sooner or later succumb to sudden and catastrophic malfunctions, rather than cycling sedately from Arcadia to Apogee to Armageddon, what are the implications for Western civilization today? First, we need to remind ourselves of how the West came to dominate the rest of the world after around 1500.

Recent research has demolished the fashionable view that China was economically neck and neck with the West until as recently as 1800. Per-capita gross domestic product essentially stagnated in the Ming era and was significantly lower than in pre-industrial Britain. The main reason for this was that China was still overwhelmingly an agricultural economy, with 90 per cent of GDP accounted for by low-productivity cultivation, a much higher share than in early-modern Britain. Moreover, for a century after 1520, the Chinese national savings rate was negative. There was no capital accumulation in late Ming China; rather the opposite.17 The story of what Kenneth Pomeranz has called ‘the Great Divergence’ between East and West therefore began much earlier than Pomeranz asserted. Even the late Angus Maddison may have been over-optimistic when he argued that in 1700 the average inhabitant of China was slightly better off than the average inhabitant of the future United States. Maddison was closer to the mark when he estimated that in 1600 British per-capita GDP was already 60 per cent higher than Chinese.18

What happened after that was that China’s output and population grew in lockstep, causing individual income to stagnate, while the English-speaking world, closely followed by North-western Europe, surged ahead. By 1820 US per-capita GDP was twice that of China; by 1870 it was nearly five times greater; by 1913 the ratio was nearly ten to one. Despite the painful interruption of the Great Depression, the United States suffered nothing so devastating as China’s wretched twentieth-century ordeal of revolution, civil war, Japanese invasion, more revolution, man-made famine and yet more (‘cultural’) revolution. In 1968 the average American was thirty-three times richer than the average Chinese, using figures calculated on the basis of purchasing-power parity (allowing for the different costs of living in the two countries). Calculated in current dollar terms the differential at its peak was more like seventy to one.

The Great Divergence manifested itself in various ways. In 1500 the world’s ten biggest cities had nearly all been in the East, with Beijing by far the biggest (more than ten times the size of wretched little London). In 1900 the biggest cities were nearly all in the West, with London more than four times the size of Tokyo, Asia’s largest conurbation. Divergence had a geopolitical dimension, too. In 1500, as we have seen, the ten European kingdoms that would become the modern era’s global empires accounted for a tenth of the world’s territory, 16 per cent of its population and a little more than two-fifths of its output. By 1913 these same states, plus the United States, controlled 58 per cent of the world’s land surface, 57 per cent of its population and 79 per cent of global GDP – of which only 18 per cent went to their colonial possessions. The world by this time was characterized by a yawning gap between the West and the Rest, which manifested itself in assumptions of white racial superiority and numerous formal and informal impediments to non-white advancement. This was the ultimate global imbalance.

I began this book with Rasselas’s question: ‘By what means … are the Europeans thus powerful? or why, since they can so easily visit Asia and Africa for trade or conquest, cannot the Asiaticks and Africans invade their coasts, plant colonies in their ports, and give laws to their natural princes?’ Imlac’s answer was that knowledge was power, but why European knowledge was superior to everyone else’s he had no idea. Now it is possible to give Rasselas a better answer. Why did the West dominate the Rest and not vice versa? I have argued that it was because the West developed six killer applications that the Rest lacked. These were:

1. Competition, in that Europe itself was politically fragmented and that within each monarchy or republic there were multiple competing corporate entities

2. The Scientific Revolution, in that all the major seventeenth-century breakthroughs in mathematics, astronomy, physics, chemistry and biology happened in Western Europe

3. The rule of law and representative government, in that an optimal system of social and political order emerged in the English-speaking world, based on private property rights and the representation of property-owners in elected legislatures

4. Modern medicine, in that nearly all the major nineteenth- and twentieth-century breakthroughs in healthcare, including the control of tropical diseases, were made by Western Europeans and North Americans

5. The consumer society, in that the Industrial Revolution took place where there was both a supply of productivity-enhancing technologies and a demand for more, better and cheaper goods, beginning with cotton garments

6. The work ethic, in that Westerners were the first people in the world to combine more extensive and intensive labour with higher savings rates, permitting sustained capital accumulation.

Those six killer apps were the key to Western ascendancy. The story of our time, which can in fact be traced back to the reign of the Meiji Emperor in Japan (1867–1912), is that the Rest finally began to download them. It was far from a smooth process. The Japanese had no idea what elements of Western culture and institutions were the crucial ones, so they ended up copying everything, from Western clothes and hairstyles to the European practice of colonizing foreign peoples. Unfortunately, they took up empire-building at precisely the moment when the costs of imperialism began to exceed the benefits. Other Asian powers – notably India – wasted decades on the erroneous premise that the socialist institutions pioneered in the Soviet Union were superior to the market-based institutions of the United States. However, beginning in the 1950s, a growing band of East Asian countries followed Japan in mimicking the West’s industrial model, beginning with textiles and steel and moving up the value chain from there. The downloading of Western applications was now more selective. Internal competition and representative government were less important features of Asian development; science, medicine, the consumer society and the work ethic (less Protestant than Max Weber had thought) were all more important. Today Singapore is ranked third by the World Economic Forum in its most recent competitiveness league table (meaning competitiveness with other countries). Hong Kong is eleventh, followed by Taiwan (thirteenth), South Korea (twenty-second) and China (twenty-seventh).19 This is roughly the order in which these countries Westernized their economies.

Patents Granted by Country of Origin of Applicant, 1995–2008

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Today per-capita GDP in China is 19 per cent that of the United States, compared with 4 per cent when economic reform began just over thirty years ago. Hong Kong, Japan and Singapore were already there as early as 1950, Taiwan got there in 1970 and South Korea got there in 1975. According to the Conference Board, Singapore’s per-capita GDP is currently 21 per cent higher than that of the US, Hong Kong’s is about the same, Japan’s and Taiwan’s are about 25 per cent lower and South Korea’s 36 per cent lower.20 It would be a brave man who bet against China following the same trajectory in the decades ahead. China’s is the biggest and fastest of all the industrial revolutions. In the space of twenty-six years, its GDP grew by a factor of ten. It took the UK seventy years after 1830 to grow by a factor of four. According to the International Monetary Fund, China’s share of global GDP (measured in current prices) will pass the 10 per cent mark in 2013. Before the financial crisis, economists at Goldman Sachs forecast that China would overtake the United States in terms of GDP in 2027.21 But the financial crisis reduced US growth more than Chinese. If present rates persist, China’s economy could surpass America’s in 2014 in terms of domestic purchasing power and by 2020 in current dollar terms.22 Indeed, in some ways the Asian century has already arrived. China is on the brink of surpassing the American share of global manufacturing, having overtaken Germany and Japan since the new century began. China’s biggest city, Shanghai, is already far larger than any American city and sits atop a new league table of non-Western megacities. In sheer numbers, of course, Asia has long been the world’s most populous region. But the rapid growth of Africa’s population makes the decline of the West a near certainty. In 1950 the West as defined by Samuel Huntington – Western Europe, North America and Australasia – accounted for 20 per cent of the world’s population. By 2050, according to the United Nations, the figure will be 10 per cent.23 Huntington’s own data point to Western decline in a number of different dimensions: language (Western share down by 3 percentage points between 1958 and 1992); religion (down by just under 1 percentage point between 1970 and 2000); territory controlled (down fractionally between 1971 and 1993); population (down by 3 percentage points since 1971); gross domestic product (down by more than 4 percentage points between 1970 and 1992);* and military manpower (down by nearly 6 percentage points between 1970 and 1991). In most cases, the relative decline is much more marked if measured from 1913 or 1938.24

The financial crisis that began in the summer of 2007 should therefore be understood as an accelerator of an already well-established trend of relative Western decline. This was very nearly a Great Depression. The reasons it has been just a Slight Depression are threefold. First, China’s huge expansion of bank lending, which mitigated the effect of slumping exports to the West. Second, the massive expansion of the US monetary base implemented by Federal Reserve Chairman Ben Bernanke. Third, the immense fiscal deficits run by nearly all developed countries, with the United States out in front with deficits in excess of 9 per cent of GDP in two consecutive years. These policies – the diametric opposite of what was done in the early 1930s – pulled the world economy out of a tailspin from June 2009 onwards. But now the developed world is in the hangover phase that follows all forms of excessive stimulus. For various reasons, the fiscal policies of three Eurozone countries, Greece, Ireland and Portugal, have lost credibility in the eyes of bond investors, driving up their borrowing costs and deepening their fiscal difficulties. Looking at the long-term trend of public debt in these countries, as the Bank for International Settlements did in early 2010, one can see why.25 The financial crisis came on top of an already serious structural problem of debt accumulation. Yet the same could be said for both the United Kingdom and the United States. And, at the time of writing, only the former has taken any steps to address the problem.

It is important to remember that most cases of civilizational collapse are associated with fiscal crises as well as wars. All the examples of collapse discussed above were preceded by sharp imbalances between revenues and expenditures, as well as by difficulties with financing public debt. Think of Spain in the sixteenth century: already by 1543 nearly two-thirds of ordinary revenue was going on interest on the juros, the loans by which the Habsburg monarchy financed itself. As early as 1559 total interest payments on the juros exceeded ordinary Spanish revenue; and the situation was little better in 1584 when 84 per cent of ordinary revenue went on interest. By 1598 the proportion was back to 100 per cent. Or think of France in the eighteenth century: between 1751 and 1788, the eve of Revolution, interest and amortization payments rose from just over a quarter of tax revenue to 62 per cent. Then there is the case of Ottoman Turkey in the nineteenth century: debt service rose from 17 per cent of revenue in 1868 to 32 per cent in 1871 to 50 per cent in 1877, two years after the enormous default which ushered in the disintegration of the Ottoman Empire in the Balkans. Finally, consider the case of Britain in the twentieth century. By the mid-1920s, debt charges were absorbing 44 per cent of total government expenditure, exceeding defence expenditure every year until 1937, when rearmament finally got under way in earnest. But note that Britain’s real problems came after 1945, when a substantial proportion of its now immense debt burden was in foreign hands. Of the £21 billion national debt at the end of the war, around £3.4 billion was owed to foreign creditors – equivalent to around a third of GDP.26

From 2001, in the space of just ten years, the US federal debt in public hands doubled as a share of GDP from 32 per cent to a projected 66 per cent in 2011. According to the Congressional Budget Office’s 2010 projections (using the ‘Alternative Fiscal Scenario’, which the CBO regards as more politically likely than its ‘Extended Baseline Scenario’), the debt could rise above 90 per cent of GDP by 2021 and could reach 150 per cent by 2031 and 300 per cent by 2047.27 Note that these figures do not take account of the estimated $100 trillion of unfunded liabilities of the Medicare and Social Security systems. Nor do they include the rapidly growing deficits of the states, nor the burgeoning liabilities of public employees’ pension schemes. On this basis, the fiscal position of the United States in 2009 was worse than that of Greece. With a debt-to-revenue ratio of 312 per cent, Greece was manifestly in dire straits. According to calculations by Morgan Stanley, however, the debt-to-revenue ratio of the United States was 358 per cent.28

These numbers are bad, but in the realm of financial stability the role of perception is in many ways more important. For now, the world still expects the United States to muddle through, eventually doing the right thing when, in a phrase commonly attributed to Churchill, all other possibilities have been exhausted. Past alarms about the deficit in the 1980s were overblown; by the late 1990s the federal government was running surpluses. So why worry? Such complacency can persist for a surprisingly long time – long after the statistical indicators have started flashing red. But one day, a seemingly random piece of bad news – perhaps a negative report by a rating agency – will make the headlines during an otherwise quiet news cycle. Suddenly, it will be not just a few specialists who worry about the sustainability of US fiscal policy but also the public at large, not to mention investors abroad. It is this shift that is crucial, for a complex adaptive system is in big trouble when a critical mass of its constituents loses faith in its viability. Beginning in the summer of 2007, the complex system of the global economy flipped from boom to bust because investors’ expectations about the probability of subprime defaults suddenly changed, blowing huge holes in the business models of thousands of highly leveraged financial institutions. The next phase of the current crisis may begin when the same investors reassess the creditworthiness of the US government itself. Neither interest rates at zero nor fiscal stimulus can achieve a sustainable recovery if people in the United States and abroad collectively decide that such measures will lead to much higher inflation rates or outright default. As the economist Thomas Sargent demonstrated two decades ago, such decisions are self-fulfilling, because it is not the supply of base money that determines inflation but the velocity of its circulation, which in turn is a function of expectations.29 In the same way, it is not the debt-to-GDP ratio that determines government solvency but the interest rate that investors demand. Bond yields can shoot up if expectations change about future government solvency or currency stability, intensifying an already bad fiscal crisis by driving up the cost of interest payments on new debt. The result is a kind of death spiral of falling confidence, rising yields and rising deficits. This is precisely what happened to Greece, Ireland and Portugal in 2010.

It is of course true that Japan has been able to increase its public debt to even higher levels relative to GDP without triggering such a crisis of confidence. However, nearly all the Japanese debt is in the hands of Japanese investors and institutions, whereas half the US federal debt in public hands is in the hands of foreign creditors, of which just over a fifth is held by the monetary authorities of the People’s Republic of China. Only the American ‘exorbitant privilege’ of being able to print the world’s premier reserve currency gives the US breathing space.30 Yet this very privilege is under mounting attack from the Chinese government. ‘Because the United States’ issuance of dollars is out of control and international commodity prices are continuing to rise,’ declared the Chinese Commerce Minister Chen Deming in October 2010, ‘China is being attacked by imported inflation.’31The United States is engaged in ‘uncontrolled’ and ‘irresponsible’ money printing, according to Xia Bin, an economic adviser to the People’s Bank of China: ‘As long as the world exercises no restraint in issuing global currencies such as the dollar … then the occurrence of another crisis is inevitable.’32 Quantitative easing (purchases of Treasury securities by the Federal Reserve) was a form of ‘financial protectionism’, declared Su Jingxiang, a researcher with the China Institute of Contemporary International Relations.33 In November 2010 the Dagong credit rating agency downgraded the US to A+ from AA, with a negative outlook.

Chinese anxieties are understandable. The prices of all but a few commodities have surged upward since the trough of the crisis.* Nor is it surprising that China’s official holdings of US Treasuries were apparently reduced by around 10 per cent between July 2009 and June 2010.34 Even with the price of an ounce of gold at an unprecedented $1,400, the Chinese began to buy it in 2010 as a time-honoured hedge against inflation. Yet the United States fears not inflation but deflation. Prices are rising at the lowest rate since the 1950s, when the consumer price index was created. Despite the Federal Reserve’s best efforts, broad money is contracting and credit stubbornly refuses to grow. Even if nominal ten-year bond yields stay low, that means real long-term interest rates are likely to stay positive in the foreseeable future, which means no easy inflationary exit from the colossal debt burden weighing down on households, banks and government alike, of the sort that was achieved by many countries in the 1920s and the 1970s. Growth will stay sluggish, which also means that the federal government will continue to run deficits, albeit smaller ones. And that means a rising interest bill. According to the Congressional Budget Office’s alternative fiscal scenario, interest payments on the federal debt will rise from 9 per cent of federal tax revenues to 20 per cent in 2020, to 36 per cent in 2030 and to 58 per cent in 2040.35

Figures like these imply, among other things, a rapid reduction in American military commitments overseas. The CBO is already projecting the savings that would be made if the number of troops deployed overseas were slashed to 30,000 by 2013.36 This is exactly what we would expect to see as interest payments outstrip military expenditure as a share of federal revenue, which they soon will.

Does the shift of the world’s centre of gravity from West to East imply future conflict? In a seminal essay, Samuel Huntington predicted that the twenty-first century would be marked by a ‘clash of civilizations’, in which the West would be confronted by a ‘Sinic’ East and a Muslim Greater Middle East, and perhaps also the Orthodox civilization of the former Russian Empire.37 ‘The principal conflicts of global politics’, he wrote, ‘will occur between nations and groups of different civilizations. The clash of civilizations will dominate global politics. The fault lines between civilizations will be the battle lines of the future.’38 Numerous objections were raised to this prediction in the wake of its publication.39 It nevertheless seems a better description of the post-Cold War world than the competing theories Huntington discarded: that there would be a post-historical (or neo-conservative) ‘one world’ under American leadership, or a realist free-for-all between nearly 200 nation-states, or just downright ‘apolarity’, otherwise known as chaos.

Yet there is one major defect in Huntington’s model. As a prophecy it has failed – thus far – to come true. Huntington claimed that ‘conflicts between groups in different civilizations will be more frequent, more sustained and more violent than conflicts between groups in the same civilization.’ This has not been the case. There has been no increase in inter-civilizational war since the end of the Cold War. Nor do wars between members of different civilizations appear to last longer than other conflicts.40 Most wars in the past two decades have been civil wars, but only a minority of them have conformed to Huntington’s model. More often than not, the wars of the New World Disorder have been fought between ethnic groups within one of Huntington’s civilizations. To be precise: of thirty major armed conflicts that were either still going on or had recently ended in 2005 – twelve years after the publication of Huntington’s original essay – only nine could be regarded as being in any sense between civilizations, in the sense that one side was predominantly Muslim and the other non-Muslim. Nineteen were essentially ethnic conflicts, the worst being the wars that continue to bedevil Central Africa, closely followed by the wars in the Greater Middle East, where the vast majority of victims have been Muslims killed by other Muslims.41 Furthermore, many of those conflicts that have a religious dimension are also ethnic conflicts; religious affiliation often has more to do with the localized success of missionaries in the relatively recent past than with long-standing membership of a Christian or Muslim civilization. The future therefore looks more likely to bring multiple local wars – most of them ethnic conflicts in Africa, South Asia and the Middle East – than a global collision of civilizations. Indeed, these centrifugal tendencies may end up tearing apart the very civilizations identified by Huntington. In short, for ‘the clash of civilizations’, read ‘the crash of civilizations’.

In the successful computer game Civilization, created by Sid Meier in 1991 and now in its fifth version, players could choose between sixteen rival civilizations, ranging from American to Zulu. The challenge was then to ‘build an empire to stand the test of time’ in competition with between two and six of the others. The game can now be won in one of three ways: reaching the end of the modern era with the highest score, winning the space race by reaching the star system of Alpha Centauri – or by destroying all the other civilizations. But is that really how the historical process works? As we have seen, Western civilization, in the form of the kingdoms and republics of Western Europe, did indeed destroy or subjugate most of the rest of the world’s civilizations after around 1500. Yet much of this was achieved with a minimum of outright conflict, at least compared with the number and scale of the wars the Western powers fought with one another.42 China’s economic stagnation and geopolitical marginalization were the consequences not of the Opium Wars, but of a protracted internal sclerosis that was inherent in the Far Eastern system of cultivation and in the imperial system of rule. The Ottoman Empire’s retreat from the European continent, and its decline from great power to ‘sick man’, was due only superficially to military defeats; the defeats themselves were due to a chronic failure to participate in the Scientific Revolution. There was no large-scale clash between North and South American civilizations; the former was simply superior institutionally to the latter and quickly acquired the means to intervene at will in Southern affairs. Likewise, the wars fought by the European empires in Africa were trivially small compared with the wars they fought with each other back home in Europe. Africa’s subjugation was as much the achievement of the mission school, the telegraph office and the laboratory as of the Maxim gun. The Industrial Revolution and the consumer society did not need to be imposed on non-Western countries; if they had any sense, they adopted both voluntarily, like the Japanese. As for the work ethic, that was spread to the East not by the sword but by the word – above all, by the major improvement in public health and education achieved from the mid-twentieth century onwards.

It is in this light that we should understand the rise of China in our time. Despite the oft-stated Chinese preference for a ‘quiet rise’, some commentators already detect the first signs of Huntington’s civilizational clash. In late 2010 the resumption of quantitative easing by the Federal Reserve appeared to spark a currency war between the US and China. If ‘the Chinese don’t take actions’ to end the manipulation of their currency, President Obama declared in New York in September of that year, ‘we have other means of protecting U.S. interests’.43 The Chinese Premier Wen Jiabao was not slow to respond: ‘Do not work to pressure us on the renminbi rate … Many of our exporting companies would have to close down, migrant workers would have to return to their villages. If China saw social and economic turbulence, then it would be a disaster for the world.’44 Such exchanges did not, however, vindicate Huntington, any more than the occasional Sino-American naval incidents or diplomatic spats over Taiwan or North Korea. They were in truth a form of pi ying xi, the traditional Chinese shadow puppet theatre. The real currency war was between Chimerica – the united economies of China and America – and the rest of the world. If the US printed money while China effectively still pegged its currency to the dollar, both parties benefited. The losers were countries like Indonesia and Brazil, whose real trade-weighted exchange rates appreciated between January 2008 and November 2010 by, respectively, 18 per cent and 17 per cent.

No doubt, Chimerica has passed its prime; as an economic marriage between a spender and a saver it already shows all the signs of being on the rocks.45 With China’s output in mid-2010 around 20 per cent above its pre-crisis level and that of the US still 2 per cent below, it seems clear that the symbiosis has become more beneficial to the creditor than to the debtor. American policy-makers utter the mantra ‘They need us as much as we need them’ and refer back to Lawrence Summers’s famous phrase about ‘mutually assured financial destruction’. Unbeknown to them, China’s leaders already have a plan to wind up Chimerica and reduce their dependence on dollar-reserve accumulation and subsidized exports. It is not so much a plan for world domination on the model of Western imperialism as a strategy to re-establish China as the Middle Kingdom – the dominant tributary state in the Asia-Pacific region.46 If one had to summarize China’s new grand strategy, the best way to do it might be, Mao-fashion, as the ‘Four Mores’:

1. Consume more

2. Import more

3. Invest abroad more

4. Innovate more

In each case, a change of economic strategy promises to pay a handsome geopolitical dividend.

By consuming more, China can and will reduce its trade surplus and in the process endear itself to its major trading partners, especially the other emerging markets. China has just overtaken the United States as the world’s biggest automobile market (14 million sales a year to 11 million) and its demand is projected to rise tenfold in the years ahead. By 2035, according to the International Energy Agency, China will be using a fifth of all global energy, a 75 per cent increase since 2008.47 It accounted for about 46 per cent of global coal consumption in 2009, the World Coal Institute estimates, and consumes a similar share of the world’s aluminium, copper, nickel and zinc production. Such figures translate into major gains for the exporters of these and other commodities. China is already Australia’s biggest export market, accounting for 22 per cent of Australian exports in 2009. It buys 12 per cent of Brazil’s exports and 10 per cent of South Africa’s. It has also become a big purchaser of high-value manufactures from Japan and Germany. Once China was mainly an exporter of low-price manufactures. Now that it accounts for fully a fifth of global growth, it has become the most dynamic new market for other people’s stuff. And that wins friends.

However, the Chinese are justifiably nervous of the vagaries of world market prices for commodities – how could they feel otherwise after the huge price-swings of the period 2004–10? So it makes sense for them to invest abroad to acquire commodity-producing assets, from oil fields in Angola to copper mines in Zambia. In just a single month (January 2010), Chinese investors made direct investments worth a total of $2.4 billion in 420 overseas enterprises in seventy-five countries and regions. The overwhelming majority of the investments were in Asia (45 per cent) and Africa (42 per cent). The biggest sectors were mining, petrochemical and communications infrastructure.48 The Chinese mode of operation is now well established across Africa. Typical deals exchange highway and other infrastructure investment for long leases of mines or agricultural land, with few questions asked about human rights abuses or political corruption.49 When challenged about China’s economic relations with Sudan, at the height of the genocide in Darfur, China’s Deputy Foreign Minister said simply: ‘Business is business.’50 In July 2008 the Chinese special envoy Liu Guijin restated China’s policy on aid to Africa: ‘We don’t attach political conditions. We have to realize the political and economic environments [in Africa] are not ideal. But we don’t have to wait for everything to be satisfactory or human rights to be perfect.’51

Growing overseas investment in natural resources not only makes sense as a diversification strategy to reduce China’s exposure to the risk of dollar depreciation. It also allows China to increase its financial power, not least through its vast and influential sovereign wealth fund, China Investment Corporation, which has around $200 billion of assets. And investment abroad justifies China’s ambitious plans for naval expansion. In the words of Rear Admiral Zhang Huachen, Deputy Commander of the East Sea Fleet: ‘With the expansion of the country’s economic interests, the navy wants to better protect the country’s transportation routes and the safety of our major sea-lanes.’52 The South China Sea is increasingly regarded as a ‘core national interest’ and deep-water ports are projected in Pakistan – in the former Omani enclave of Gwadar – as well as in Burma and Sri Lanka. This is a very different maritime model from Admiral Zheng He’s (see Chapter 1). It comes straight from the playbook of the Victorian Royal Navy.

Finally, and contrary to the view that China is condemned to remain an assembly line for products ‘designed in California’, China is innovating more, aiming to become (for example) the world’s leading manufacturer of wind turbines and photovoltaic panels. In 2007 China overtook Germany in terms of the number of new patent applications. It will soon do the same in terms of patents granted, having overtaken Britain in 2004, Russia in 2005 and France in 2006. Since 1995 the number of new patents granted to Chinese innovators has increased by a factor of twenty-nine.53 This is part of a wider story of Eastern ascendancy. China has increased expenditure on research and development by a factor of six in the past decade, has more than doubled the number of its scientists and is now second only to the United States in its annual output of scientific papers and its supercomputing capability. There remains a significant gap in terms of international citations of Chinese research, but there is good reason to expect this to close.54 Perhaps the most compelling evidence that the shift from West to East is real lies in the realm of education. In a 2005 study of academic attainment by people aged twenty-five to thirty-four, the Organization for Economic Co-operation and Development found a startling differential between the top countries, South Korea and Japan, and the laggards, Britain and Italy.55 The same gulf manifests itself in standardized tests of mathematical aptitude among fourteen-year-olds, where students from Singapore far outperform students from Scotland. The former are 19 per cent above the international average; the latter 3 per cent below it.56

GDP of Greater China (People’s Republic plus Hong Kong, Singapore and Taiwan) as a Percentage of US GDP, 1950–2009

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Average Mathematics Score of 8th Grade (~14-year-old) Students, 2007 (International mean = 500)

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What could go wrong for the ascending Chinese dragon? There are at least four different hypotheses proposed by those who expect it to stumble. The first is that similar projections of inexorable ascent used to be made for Japan. It too was supposed to overtake the United States and to become the number one global economic superpower. So, the argument goes, China could one day suffer the fate of Japan after 1989. Precisely because the economic and political systems are not truly competitive, a real-estate or stock-market bubble and bust could saddle the country with zombie banks, flat growth and deflation – the plight of Japan for the better part of two decades now. The counter-argument is that an archipelago off the east coast of Eurasia was never likely to match a continental power like the United States. It was credible to predict even a century ago that Japan would catch up with the United Kingdom, its Western analogue – as it duly did – but not that it would overhaul the United States. In addition, Japan’s defeat in 1945 meant that throughout the period of its economic ascent it was dependent on the United States for its security, and therefore had to submit to more or less mandatory currency appreciation, for example under the 1985 Plaza Accord.

A second possibility is that China might succumb to social unrest, as has so often happened in its past. After all, China remains a poor country, ranked eighty-sixth in the world in terms of per-capita income, with 150 million of its citizens – nearly one in ten – living on the equivalent of $1.50 a day or less. Inequality has risen steeply since the introduction of economic reforms, so that the income distribution is now essentially American (though not quite Brazilian). An estimated 0.4 per cent of Chinese households currently own around 70 per cent of the country’s wealth. Add to these economic disparities chronic problems of air, water and ground pollution, and it is not surprising that the poorer parts of the Chinese rural hinterland are prone to outbreaks of protest. Yet only a fevered imagination could build a revolutionary scenario on these slender foundations. Economic growth may have made China a less equal society, but the capitalist-communist regime currently enjoys uniquely high levels of legitimacy in the eyes of its own people.57 Indeed, survey data suggest that Chinese people today are more committed to the idea of the free market than Americans. The real social threat to China’s stability is demographic. As a result of the One-Child policy introduced in 1979, China by 2030 will have a significantly more elderly population than its comparably large neighbour India. The share of the population aged sixty-five and over will be 16 per cent, compared with 5 per cent in 1980. And the gender imbalance in provinces like Anhui, Hainan, Guangdong and Jiangxi is already quite without parallel in a modern society, with between 30 and 38 per cent more males than females.58 The next Chinese revolution, if there is going to be one, will be led by frustrated bachelors. But history suggests that young men without women are as likely to embrace radical nationalism as revolution.

A third plausible scenario is that a rising middle class could, as so often in Western history, demand a bigger political say than they currently have. China was once a rural society. In 1990 three out of four Chinese lived in the countryside. Today 45 per cent of people are city-dwellers and by 2030 it could be as high as 70 per cent. Not only is a middle class rapidly growing in urban China; the spread of mobile telephony and the internet means that they can form their own spontaneous horizontal networks as never before. The challenge this represents is personified not by the jailed dissident Liu Xiaobo, awarded the 2010 Nobel Peace Prize, who belongs to an earlier generation of activists, but by the burly, bearded artist Ai Weiwei, who has used his public prominence to agitate on behalf of the victims of the 2008 Sichuan earthquake. The counter-argument here comes from a young Beijing-based television producer I got to know while researching this book. ‘My generation feels like it’s the lucky one,’ she told me one night. ‘Our grandparents had the Great Leap Forward, our parents had the Cultural Revolution. But we get to study, to travel, to make money. So I guess we really don’t think that much about the Square thing.’ At first I didn’t know what she meant by that. And then I realized: she meant the Tiananmen Square ‘thing’ – the pro-democracy protest crushed by military force in 1989.

The fourth and final pitfall is that China may so antagonize its neighbours that they gravitate towards a balancing coalition led by an increasingly realist United States. There is certainly no shortage of resentment in the rest of Asia about the way China throws its weight about these days. Chinese plans to divert the water resources of the Qinghai-Tibetan plateau have troubling implications for Bangladesh, India and Kazakhstan. In Hanoi patience is wearing thin with the Chinese habit of employing their own people in Vietnamese bauxite mines. And relations with Japan took such a turn for the worse in a dispute over the tiny Senkaku/Diaoyu Islands that China imposed an embargo on rare-earth exports, in retaliation for the arrest of a stray Chinese fisherman.59 Yet these frictions are very far from sufficient grounds for what would be the biggest shift in US foreign policy since Richard Nixon and Henry Kissinger reopened diplomatic communications with China in 1972. And the forty-fourth incumbent of the White House seems a long way removed from the realist tradition in American foreign policy, despite the impression left by his visits to India and Indonesia in late 2010.

Europe, America, China and India, Estimated Shares of Global GDP, Selected Years, 1500–2008

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The dilemma posed for the ‘going’ power by the ‘coming’ power is always agonizing. The cost of resisting Germany’s rise was heavy indeed for Britain; it was much easier quietly to slide into the role of junior partner to the United States. Should America seek to contain China? Or appease China? Opinion polls suggest that ordinary Americans are no more certain how to respond than the President. In a recent survey by the Pew Research Center, 49 per cent of respondents said they did not expect China to ‘overtake the U.S. as the world’s main superpower’, but 46 per cent took the opposite view.60 Coming to terms with a new global order was hard enough after the collapse of the Soviet Union, which went to the heads of many commentators. But the Cold War lasted little more than four decades and the Soviet Union never came close to overtaking the US economy. What we are living through now is the end of 500 years of Western predominance. This time the Eastern challenger is for real, both economically and geopolitically. It is too early for the Chinese to proclaim ‘We are the masters now.’ But they are clearly no longer the apprentices. Nevertheless, civilizational conflict in Huntington’s sense still seems a distant prospect. We are more likely to witness the kind of shift that in the past 500 years nearly always went in favour of the West. One civilization grows weaker, another stronger. The critical question is not whether the two will clash, but whether the weaker will tip over from weakness to outright collapse.

Retreat from the mountains of the Hindu Kush or the plains of Mesopotamia has long been a harbinger of decline and fall. It is significant that the Soviet Union withdrew from Afghanistan in the annus mirabilis of 1989 and ceased to exist in 1991. What happened then, like the events of the distant fifth century, is a reminder that civilizations do not in fact appear, rise, reign, decline and fall according to some recurrent and predictable life cycle. It is historians who retrospectively portray the process of dissolution as slow-acting, with multiple over-determining causes. Rather, civilizations behave like all complex adaptive systems. They function in apparent equilibrium for some unknowable period. And then, quite abruptly, they collapse. To return to the terminology of Thomas Cole, the painter of The Course of Empire, the shift from consummation to destruction and then to desolation is not cyclical. It is sudden. A more appropriate visual representation of the way complex systems collapse may be the old poster, once so popular in thousands of college dorm rooms, of a runaway steam train that has crashed through the wall of a Victorian railway terminus and hit the street below nose first. A defective brake or a sleeping driver can be all it takes to go over the edge of chaos.

Can anything be done to save Western civilization from such a calamity? First, we should not be too fatalistic. True, the things that once set the West apart from the Rest are no longer monopolized by us. The Chinese have got capitalism. The Iranians have got science. The Russians have got democracy. The Africans are (slowly) getting modern medicine. And the Turks have got the consumer society. But what this means is that Western modes of operation are not in decline but are flourishing nearly everywhere, with only a few remaining pockets of resistance. A growing number of Resterners are sleeping, showering, dressing, working, playing, eating, drinking and travelling like Westerners.61 Moreover, as we have seen, Western civilization is more than just one thing; it is a package. It is about political pluralism (multiple states and multiple authorities) as well as capitalism; it is about the freedom of thought as well as the scientific method; it is about the rule of law and property rights as well as democracy. Even today, the West still has more of these institutional advantages than the Rest. The Chinese do not have political competition. The Iranians do not have freedom of conscience. They get to vote in Russia, but the rule of law there is a sham. In none of these countries is there a free press. These differences may explain why, for example, all three countries lag behind Western countries in qualitative indices that measure ‘national innovative development’ and ‘national innovation capacity’.62

Of course Western civilization is far from flawless. It has perpetrated its share of historical misdeeds, from the brutalities of imperialism to the banality of the consumer society. Its intense materialism has had all kinds of dubious consequences, not least the discontents Freud encouraged us to indulge in. And it has certainly lost that thrifty asceticism that Weber found so admirable in the Protestant ethic.

Yet this Western package still seems to offer human societies the best available set of economic, social and political institutions – the ones most likely to unleash the individual human creativity capable of solving the problems the twenty-first century world faces. Over the past half-millennium, no civilization has done a better job of finding and educating the geniuses that lurk in the far right-hand tail of the distribution of talent in any human society. The big question is whether or not we are still able to recognize the superiority of that package. What makes a civilization real to its inhabitants, in the end, is not just the splendid edifices at its centre, nor even the smooth functioning of the institutions they house. At its core, a civilization is the texts that are taught in its schools, learned by its students and recollected in times of tribulation. The civilization of China was once built on the teachings of Confucius. The civilization of Islam – of the cult of submission – is still built on the Koran. But what are the foundational texts of Western civilization, that can bolster our belief in the almost boundless power of the free individual human being?* And how good are we at teaching them, given our educational theorists’ aversion to formal knowledge and rote-learning? Maybe the real threat is posed not by the rise of China, Islam or CO2 emissions, but by our own loss of faith in the civilization we inherited from our ancestors.

Our civilization is more than just (as P. G. Wodehouse joked) the opposite of amateur theatricals (see the epigraph above). Churchill captured a crucial point when he defined the ‘central principle of [Western] Civilization’ as ‘the subordination of the ruling class to the settled customs of the people and to their will as expressed in the Constitution’:

Why [Churchill asked] should not nations link themselves together in a larger system and establish a rule of law for the benefit of all? That surely is the supreme hope by which we should be inspired …

But it is vain to imagine that the mere … declaration of right principles … will be of any value unless they are supported by those qualities of civic virtue and manly courage – aye, and by those instruments and agencies of force and science [–] which in the last resort must be the defence of right and reason.

Civilization will not last, freedom will not survive, peace will not be kept, unless a very large majority of mankind unite together to defend them and show themselves possessed of a constabulary power before which barbaric and atavistic forces will stand in awe.63

In 1938 those barbaric and atavistic forces were abroad, above all in Germany. Yet, as we have seen, they were as much products of Western civilization as the values of freedom and lawful government that Churchill held dear. Today, as then, the biggest threat to Western civilization is posed not by other civilizations, but by our own pusillanimity – and by the historical ignorance that feeds it.

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