Preparing for Next-Generation Globalization
We live in an age of global competition, and that competition is centered on emerging technologies. Authoritarian regimes are attempting to change the international order to their advantage in the race to adopt emerging technology to control and shape the world to their vision, which puts liberal democratic values at great risk if we do not collectively counter their efforts.
Globalization, the rapidly growing integration of the world’s economies and markets, is entering a new phase dubbed by some experts as Globalization 4.0, and the United States and its friends and allies should begin working together now to reap the benefits.
While not all experts agree, many say humanity has witnessed three phases of globalization, each indicated by rapid increases in international interaction. The first began in the late 1800s or early 1900s with the Industrial Revolution and a sudden growth of exports around the world. The next lasted approximately from 1944 to 1971, during which an international monetary system emerged based on the value of the U.S. dollar. The third iteration began around 1990 with the spread of the World Wide Web and the opening of the Communist Eastern bloc nations.
Now, some scholars argue, we are entering a fourth phase. Klaus Schwab, founder and executive chairman of the World Economic Forum, says, “Globalization 4.0 has only just begun, but we are already vastly underprepared for it. Clinging to an outdated mindset and tinkering with our existing processes and institutions will not do. Rather, we need to redesign them from the ground up, so that we can capitalize on the new opportunities that await us, while avoiding the kind of disruptions that we are witnessing today.”
While the internet and the World Wide Web helped fuel the third wave, the fourth is accompanied by a plethora of technological advances, including robotics, artificial intelligence, additive manufacturing, next-generation mobile, quantum computing and nanotechnology.
The role played by authoritarian nations is one glaring difference between globalization’s third and fourth waves. During the third wave, the world’s democracies welcomed economic cooperation with the likes of China and Russia, both of which yearned to play a bigger part in the global economy. The expectation—or at least the hope—was that totalitarian nations would accept a degree of responsibility for maintaining the international order and peace and prosperity for the benefit of all. As a December Foreign Affairs article points out, China in the 1980s and 1990s “embraced market mechanisms, including foreign investments and some autonomy for private businesses as solutions to economic problems.”
Now, Xi Jinping and the Chinese Communist Party are increasingly antagonistic toward their own industries. The Foreign Affairs article notes that the Chinese government has purchased stakes in private firms and has adopted an array of laws on cybersecurity, data security and national intelligence that grant authorities immense power, requiring firms and individuals to assist the state on security issues.
In addition, under Xi Jinping’s leadership, the Chinese economy is in free fall and the government in turmoil. The foreign minister, defense minister and entire leadership of the People’s Liberation Army Rocket Force have all been removed from leadership.
For its part, Russia adopted a federal semi-presidential system and a new constitution following the dissolution of the Soviet Union. But it has grown increasingly authoritarian under Vladimir Putin’s reign and has attacked its neighbors, claiming valuable territories as its own. Vladimir Putin’s regime also has manipulated the global economy by blockading grain shipments from Ukraine and cutting off gas supplies to multiple European countries in response to sanctions.
Putin’s illegal invasion of Ukraine is an assault on the international order, which promotes a shared commitment by all countries to act in accordance with international laws, regional security agreements and trade agreements. Russia has hinted at nuclear war in Ukraine with Deputy Chairman of the Security Council of the Russian Federation Dmitry Medvedev declaring in March that “nuclear apocalypse” draws closer.
And Russia is not alone. China’s Communist Party claims as its own parts of the South China Sea that have been internationally recognized as belonging to the Philippines. It also is expanding its nuclear armaments. And North Korea is rapidly developing nuclear weapons of its own.
Under authoritarian leadership, Russia, China and others have weaponized economic trade, cyber theft of intellectual property, control of supply chains and infrastructure development. In doing so, they export authoritarianism and control, putting at risk the free trade and democratic values that lifted millions out of poverty and strive to achieve global peace and prosperity.
Democracies and free-thinking societies compete against these authoritarian states hell-bent on destroying the rules-based international order, controlling their own populations and exerting power and influence across the globe.
In some ways, the situation for the world’s democracies seems dire. China essentially owns and manipulates the global supply chain for rare materials needed for advanced electronics. According to the 2023 Annual Threat Assessment of the U.S. intelligence community, China’s dominance in mining and processing of strategic materials, including rare-earth elements, presents a major vulnerability to the United States, and China could restrict quantities of rare earth minerals for commercial advantage or as a tool in political or trade disputes.
Furthermore, by some accounts, the rules-based international order already is failing. Walter Russell Mead, an American academic who has taught American foreign policy at Yale University, wrote in the Wall Street Journal that the rules-based international order is quietly disintegrating and that the core institutions that support it are losing relevance.
And Andrew Latham, a professor of international relations at Macalester College in Saint Paul, Minnesota, and a nonresident fellow at Defense Priorities in Washington, D.C., wrote in The Hill that the rules-based order is “disintegrating before our very eyes.”
Adding to the growing alarm signals, the Australian Strategic Policy Institute (ASPI) makes the case that the United States has lost its technological advantage to China. The ASPI’s Critical Technology Tracker, launched in March, indicated that China leads the world in 37 of 44 essential technology areas. The initial report included technologies in defense, space, robotics, artificial intelligence, energy, advanced materials and quantum.
It is true that China gained a competitive edge technologically and economically during the third phase of globalization. It did so, in part, by embracing to a limited degree the advantages offered by free market capitalism. It also engaged in outright theft of intellectual property, ideas and innovations from others, most notably industries and governments in democratic countries, the true hotbeds of innovation.
Despite recent warning signs, democracies still offer competitive advantages. First is the willingness and the ability to share information and to work together—especially when poked by competitors and adversaries. These trusted partnerships are stronger and more enduring than the tenuous and spasmodic cooperation sometimes found among authoritarian regimes, which by their nature will invest only in self-interests.
Just look at the Russian invasion of Ukraine, for example. In February, the International Business Times listed 10 countries that “support” Russia. Most of that support, however, takes the form of pro-Russia rhetoric. Actual military or economic support from the likes of China, Belarus and Iran has been scant compared to the overwhelming support for Ukraine, primarily from the NATO alliance of 31 countries.
Marching into the fourth phase, it is now time for the free world to reconsider its approach to globalization. We know that Russia, China and others will never embrace the benefits-for-all approach. We have tried to let globalization produce a free and open global market of supply and demand, which lifted millions out of poverty. But totalitarian governments who need to control their populations, largely by controlling information, have refused to play by these open standards and have twisted openness to their own advantage.
We need to align economies of like-minded democracies to protect our respective and global national security. Supply chains were greatly affected and stressed during the COVID-19 pandemic and are of great concern for the proliferation of communications, artificial intelligence, machine learning, quantum and other emerging technologies.
This realignment should include economic, industrial and technological interests with like-minded partners and allies to protect our rules-based international order and secure supply chains. Doing so will ensure the proliferation of emerging technologies to enhance freedoms and democratic ideas and values while benefiting economies and international security.
Both government and the private sector have roles to play in this great realignment. Large companies with liberal democratic values and ideals have a moral obligation to cooperate with like-minded international counterparts. Governments and the private sector should align research and development strategies to foster innovation, accelerate technology development and speed the adoption of critical emerging technologies.
Meanwhile, national security leaders across governments and private sectors must meet challenges by creating and embracing purchasing power parity (PPP) economies of scale through collaboration, technology accelerators and access to secure information technology and operational technology supply chains.
PPP can support democracies, enhance friendships, foster partnerships and help achieve overmatch against those who despise democratic values and open markets. International cooperation can include the sharing of information, ideas and innovations in cybersecurity and other critical areas of interest.
The central lesson learned from the history of globalization is that the power of democracy is more sustainable when exercised within—and reinforced by—a shared system of mutual benefit. Let that be our guiding principle for Globalization 4.0.
In this global competition, together we win and divided we lose.
Brig. Gen. Paul H. Fredenburgh III, USA (Ret.), serves as AFCEA’s executive vice president for national security and defense. He retired following a distinguished military career in the U.S. Army that spanned 32 years. His many assignments included serving as the deputy commander of Joint Force Headquarters–Department of Defense Information Network (JFHQ-DoDIN), where he directed an organization focused on command and control of global network and defensive cyber operations that enabled cyber mission assurance for the Defense Department.
