The Hidden History of the Third World War: Toward Europe 1992

Article excerpt

Yes, there are still two superpowers in the world. But they are no longer the United States and the Soviet Union. The new superpowers are Japan and Germany.

Jean-Jacques Servan-Schreiber

WINNERS AND LOSERS. It was not just that World War II and the United States-Soviet Cold War had finally ended in Berlin in 1989. Another war was also winding down. This was a war at once undeclared and yet global. It was a war in which the body count was low but the economic and political impact enormous. It was a war so subtle that leaders everywhere could credibly deny it had even happened, yet so complex that the world may need the rest of this century to negotiate the terms of its peace. It was a cold war within the Cold War. It was fought more or less throughout the 1980s. It was, from a functional point of view, the Third World War.

The big "winners" of the Third World War were Japan and Germany--the very powers that had been the losers of World War II.

Also among the winners were some of the European and East Asian countries that had been nominal victors in World War II, but only after massive suffering at the hands of Nazi Germany or Imperial Japan. By holding their noses, taking the plunge of geo-realism, and aligning economically with their much-chastened enemies from four decades earlier, Western Europeans as well as East Asians emerged again as winners in the Third World War-- with far more to show for their triumph this time around.

The big "losers" of the Third World War were the United States and the Soviet Union the very powers that not only won World War II but became leaders of vast empires and blocs as a result. The Soviet defeat was obvious and total. Its post-Third World War future looks extremely bleak. America's defeat, on the other hand, was only partial. It left the country in a situation not unlike that of Japan and Germany after World War II. Although sectors of the American economy lay vanquished by foreign competition and in near-ruins at the end of the 1980s, the basis for revival was still solid. The necessary condition was an American public- and private-sector leadership willing to pursue in the 1990s policies as farsighted and self-disciplined as those of Germany and Japan in the 1950s and 1960s.

A DECADE OF ROLE REVERSALS AND RADICAL CHANGE. The realignments and shifts of power that occurred between 1980 and 1990 were of the magnitude that has historically been associated with great wars. Insofar as American and Soviet power are concerned, the 1980s resembled nothing so much as a replay of World War II and its outcome--only this time in reverse. Let us recall for a moment just how radical the changes of the 1980s were with respect to economic power and global leadership, first for the United States and then for the Soviet Union:

Early 1980s: The United States was the world's largest creditor nation.

End of the 1980s: The United States became the largest debtor nation in history. Japan, meanwhile, replaced the United States as the world's leading creditor, with West Germany second.

Early 1980s: Japan and the United States both suffered modest trade deficits, while West Germany's traditional trade surplus was reduced nearly to zero as a result of the oil crisis that followed the Iranian revolution.

End of the 1980s: Japan and Germany were neck and neck in the race to enjoy the world's biggest trade surplus. Their positive annual trade balances have ranged from $70 billion to nearly $100 billion in recent years--far, far ahead of any other nation's. The United States, meanwhile, has consistently posted staggering annual trade deficits in the $100-170 billion range.

Early 1980s: Despite a growing appetite for imported foreign goods, the United States was still the world's largest exporting nation.

End of the 1980s: West Germany, with a work force less than one fourth the size of America's, caught up to the United States as the world's leading exporting nation in absolute terms. …