Hegemony, Conflict and Cooperation

Abstract

It is striking how outdated the Bretton Woods system seems today. The fall of that system — outlined at the end of the last chapter — was partly a function of its own internal contradictions (the Triffin paradox), but also, perhaps mainly, a function of the rise of forces that broke the mould of the state-centric assumptions upon which the system was constructed. In the years since 1973 these forces have developed in ways that few anticipated at the time, and we now live in a world in which global economic forces compete for power with the state and with each other, creating a new kind of diplomacy. The purpose of this chapter is to present two rather different accounts of this new diplomacy, one of which stresses regimes and cooperation under conditions of declining American hegemony, while the other puts the emphasis on anarchy, conflict and the reality of continued American structural power. However, before moving to these competing accounts of the new world in which we live it is necessary first to outline some of the most dramatic changes that have taken place since the 1950s and the beginnings of the post-war revival of the international economy and the long ‘boom’ which ended in the 1970s.