After the cold war, some successive events have taken place in the world that make it crystal clear that economic position, not military, determines the strength of any country. Edward Luttwak, a security consultant, first suggested this term. He was foreseeing a peaceful world being engaged in economic activities. Today, it is not wrong to say that economic might directly influences the power any country. For instances, although, European signatories to Iranian nuclear deal disliked the unilateral withdrawal of Trump from the deal, yet they chose to support Washington and left Iran because of American economic strength. They also became a part of the Afghan war owing to the US. Besides, Pakistan, despite having professional army, failed to attract Muslim countries to push more pressure on India to solve Kashmir issue. Had Pakistan possessed a strong economy instead of the military, it would have been easy for it to achieve foreign policy objectives in Kashmir. Moreover, When Trump came into power, he was determined to solve international conflicts through dialogue and negotiation, but he did not force Modi to solve Kashmir issue because India is a greater economic market for the US. Further more, Chinese growth, that has challenged the writ of America, is also because of economy. The power has shifted from military to economy because the military confrontation took a backseat after the advent of nuclear weapons and the countries placed their entire focus on the economy. Thus, it has been established that the element of power has shifted from military to economy after the cold war and now it is economy that determines the strength of any country.
Since power is dynamic, its elements keep shifting by time. Previously, the world was divided into different tribes and a tribe with a large population was considered powerful. Hence, it was population that determined the strength of tribes at that time. Afterward, people invented some fighting equipment like arrows and swords. Consequently, the element of power shifted from population to fighting equipment. After the passage of time, some tribes conquered other and formed a larger empire shifting the power to the realms. The British Empire is the best example to explain the power shifting towards kingdoms. The process of power shifting continued. In 1945, the US tested its first nuclear bomb and soon the soviet, US, France and so on followed the suit. At that time power shifted towards the nuclear weapons. The bomb then influenced the strength of any country. After the end of cold war, the countries placed their entire focus on the economic development and business oriented polices like free trade were also framed. Besides, the advance in technology like transportation also boosted the economic activities. Thus, the element of power shifted towards economy after the end of the cold war.
How the economic position determines the strength of a country can be judged from the actions and behaviors of the European countries towards Iran after Trump decided to withdraw from the Iranian Nuclear Deal. It was Europe that initiated the deal to get the economic sanctions lifted from Iran. Europe was Iran’s largest trading partner before sanctions. Hence, the friendly relation with Tehran is in its national interest. It was the reason that when the deal was signed in 2015, Hassan Rouhani made his first trip to Europe and signed economic deals worth billions of dollars. Given these conditions, Trump’s withdrawal from the deal was against the national interest of the European countries, but they left Iran in favor of the US. Had the US not an economic power, they would have not scarified their interest in Iran. Thus, they way the European countries left Iran for the US proves the fact that the economic power influences the strength of any country.
The position of Pakistan provides a classical example of how the strong military stands worthless in front of the economic strength. Pakistan is not regarded as a powerful country despite having well-trained and professional army. Very recently, when Modi revoked special-status of Jammu and Kashmir, Prime Minister of Pakistan toured Muslim countries and delivered speeches at the different international platforms to gather support to push India to reverse its decision. However, no country, except China, extended its hand to support Pakistan and stood with it for a common cause. It was the weak economic position of Pakistan that it could not draw countries to itself like the US did during the Iranian Nuclear Deal and invasion of Afghanistan. If Pakistan had a strong economy, it could have punished India like the US did with Iran by imposing sanctions and threatening other countries against engaging in trade activities with it. Thus, Pakistan can force India by imposing economic sanctions to reverse its decision in Kashmir, but for putting such pressure, it must have strong economy instead of military.
The power of an economy can also be deduced from the policy of Trump towards Kashmir. After coming to the power, he was determined to solve the international conflicts through dialogues. He said, “Negotiation and diplomacy is preferred over the conflict and hostility.” He engaged in negotiation with North Korea to solve its decades long nuclear issue. He has adopted the same line of action for Afghanistan. He also wrote a letter to Erdogan, president of Turkey, and prohibited him to use his force against Kurds. Besides, he asked him to solve the issue in peaceful way. However, the similar rhetoric of Trump is absent for Kashmir and it is because India is a larger economic market for the US. Trump does not want to annoy Modi over Kashmir issue by forcing him to reach a compromise the same way he is putting pressure on Erdogan for Kurds issue. As such, the non-resolution of Kashmir issue is because of American economic dependency on New Delhi.
The next case in point is the conduct of Muslim countries on the call of Pakistan after Modi annexed Kashmir to New Delhi. Modi, very recently, revoked special-status of Indian Held Kashmir (IHK) by repealing Article 35A. Besides, Indian army committed grave human rights abuses when people took to the streets to protest against his catastrophic move. Middle East countries, being Muslims, did not put pressure on India to prevent the grave human rights violation in Kashmir. To make things worse, Modi was honoured with UAE’s highest civilian award “Order of Zayed” soon after the revoking the article instead of berating him for his evil designs in Kashmir. India is Saudi’s largest oil importer while the UAE has signed trade deals with New Delhi worth around $100 billion. Because of these economic interests, Middle East would never pressurize India over Kashmir issue.
The fastest growth of China has challenged the supremacy of the US and it is the economic rather than military development of Beijing that is a cause of concern for Washington. Since 2001, China’s economy has grown from $1 trillion to a whopping $13 trillion. In the same period, the US squandered its resources in different conflicts, including in Iraq and Afghanistan. The GDP of America, today, stands at $21 trillion. If China reaches this figure, it will replace the US as an economic and World’s super power. The US is aware of this threat and it is, therefore, Trump has launched a trade war against China to prevent its economic rise. Russia is turning advance in military capability, but the US has no issue with it. Thus, the China’s fast economic development and the US trade war with it clearly lead towards the fact that economic power, now, determines the strength of any country.
The war in Afghanistan was more a personal war of the US because the 9/11 attacks were carried against it, but the European countries were made its part through NATO and they happily complied with the command of Bush owing to their economic interests. Soon after the attack, the provisions of NATO were amended and it was included that attack on any NATO member will be deemed as an attack on its all members. Had the US be an economical weak state, the European countries would have never become a part of the war because war even prove disastrous for the victorious country. Thus, the participation of NATO in Afghan war was because of economic reasons.
The power has shifted from military to economy after the end of Cold War because the military confrontation among the countries took the back seat under the unipolar word and the countries started to engage in the economic activities. They also shifted their foreign policy from military to economy and started to develop good working relations with the countries for economic benefits. For example, Pakistan changed its policy of renting its geo-strategic location for money. Now it has been focusing on the economy as witnessed from its entire focus on China-Pakistan Economic Corridor (CPEC). Thus, unipolar world brought peace in the globe and it forced the countries to put more focus on the economy rather than military. Resultantly, the power shifted to the economy as predicted by Edward Luttwak.
The new World Order was established by the US that surged the value of economy. It was based on the capitalism (free markets), democracy and collective security. The new laws related to trade were also introduced by forming World Trade Organisation (WTO) in 1995. The entire focus of the US during this period was on the trade because liberal scholars suggested that it was the only way to create peace and prevent the countries to cause conflicts. The rules of WHO made the conduct of trade plain sailing. Thus, the US facilitated the international trade. Resultantly, the value of economy rose above the military and became a power-determining factor of the countries.
It is now imperative for the all countries to maintain the value to economy as the determining factor of power because it has not only created peace in the globe, but also improved the lifestyle of the people. All the impediments that stand on the smooth route of the economic development must be addressed. The US, being the super power, must stop taking any measure that could cause damage to globalization and should prevent the trade war with China. Instead of indulging in competition with Beijing over its Belt-Road Initiative (BRI), the US must support its vision to engage the world deeper into economic race. The US and China should be an ally instead of a competitor in the best interest of the poor countries. They must invest a large sum of money in under-developed countries to improve the life-style of the people. Already, the World Bank has estimated that the developing countries need an investment of around $100 billion annually. Rather than wasting money in different conflicts, the US should invest that money in the third world countries to maintain the value of economy. Finally, Chinese and American blocs need to sign an agreement to reduce the expenditure on the military and spend the same money for the economic betterment of the globe. As such, since the economy, as the determining factor of the strength of any country, is beneficial for all the countries, the stakeholders must maintain its value.
Thus, the element of power has shifted to economy after the end of the Cold War as predicted by Edward Luttwak. At present, it is economy that helps any country to achieve its national interest because no country turns harsh against the economic power. Many examples have taken place recently that proves this fact. It was the economic might of the US that the European countries supported it during its withdrawal from the Iranian Nuclear Deal and invasion of Afghanistan, despite they were unwilling to do so. It was also because of economic interest of the Middle East Muslim countries in India that they did not force Modi to reverse its decision of revoking Article 35A in Kashmir. Chinese threat to the US is also owing to its economic development. Economic power has proved better for the countries because it has improved the lifestyle of the people and made the conflicts less likely. It is, therefore, the US and China, instead of become a competitor, should forge a good working relations to prevent any damage to the economic development of the globe. As such, the power has shifted from the military to economy as manifested by a number of events that are taking place after the end of the Cold War and now it is economy that determines the strength of any country.