[Editors Note – Arthur was another expert that joined the Harvard-Beida Conference earlier in the month.]

The disjuncture between economic and military structure is not a new phenomenon.  The Cold War, certainly from the early 1960s on, consisted of military bipolarity and economic multipolarity (at a minimum, the end of the Bretton Woods order in the early 1970s signaled the end of US economic hegemony).

The post Cold War has seen military unipolarity and economic multipolarity.  In each case, economic multipolarity has meant that there have been powers capable of exerting substantial economic power but not militarily capable of global power projection.  In a sense, the current case of China is similar.  China is a global economic power, with an economic impact that extends to every continent, but militarily only a regional one.

The critical difference today is the alignment pattern.  In the past, the other centers of global economic influence were security allies of the US and dependent on the US for their military security.  Now, China is not part of a US security sphere, and the concern is that it will have in its economic orbit states that have security links to the US.  This raises a concern that did not exist in earlier periods, that of an economic power (China) that would use its economic leverage to achieve geo-strategic objectives antithetical to the US and its allies.  The result could then be economic appeasement on the part of US allies.

One place to look for this consequence is the current financial troubles of the government of Vietnam.  Will acceding to China’s territorial claims in the South China Sea be the price of a Chinese bailout of Vietnam?