This was the year that everything was supposed to change. We were told that the greatest financial and economic crisis since the Great Depression would usher in a new paradigm on global markets and authority (look up)...did it? Judging by the top political stories of 2009, not quite:
And then it was two...the G2
For years we have been waiting for the inevitable moment when China would elevate to great-power status and challenge the US for global authority and influence. While the conventional wisdom says that this happened in 2009, the reality is more nuanced. China's role as America's banker and its economic performance are the envy of the world and empowered it with great and growing influence over affairs both local (see: African investment) and global (see: climate change). But it is still years, maybe decades, away from truly rivaling the US on military, economic and political power. It's precarious social order and frothy economic recovery may yet fundamentally undermine the communist party and China's methodical rise on the international stage.
That said, the US-China balance was clearly tilting eastward following the crisis and 2009 was the year that the so-called 'G2' paradigm finally crystallized. The US and China are now the two primary players and their cooperation is essential to progress on almost every major global issue, from trade to climate change.
Exit the old, enter the new economic order...sort of
The crisis would change the relationship between government and markets, reorganize the major economies, elevate the emerging giants and re-regulate financial markets. The G20 talked a big game and editorial boards called for sweeping regulatory reform. Everything would be different the next time around.
Remember those heady days? Crises often bring about transformative change, but the window of opportunity to affect this change is often small. Unfortunately, this window closed quickly in 2009 with little substantive reform enacted either transnationally or within the major economies. In the US, massive government bailouts translated into surprisingly little leverage in the re-regulation of the financial sector. Executives at AIG are using the threat of resignation to extort further pay exemptions from Obama's pay czar. Perverse incentives and too big to fail firms still pervade the system. Record profits have afflicted the financial sector with collective amnesia.
The problem is one of political will and policymakers in the US in particular lacked the courage and purpose to enact real regulatory reform. We need more Paul Volkers and less Timothy Geithners.
Obama- The Tragedy of Great Expectations
What started with such promise and purpose ends the year struggling under the weight of expectations. To be fair, the Obama administration's first year has been marked by notable successes domestically, from the stimulus package to health care to executive orders reversing Bush-era policies on everything from stem cells to government secrecy. His international rhetoric and posture have remarkably transformed the image of the US following eight years of tarnish. His Cairo and Nobel speeches were transcendent.
But many of us are still waiting for 'change we can believe in.' Perhaps the expectations were always too high, setting Obama up for an inevitable fall. Perhaps the challenges facing the US are too great for one government to correct. But I can't help but feel that on issues where he could affect great change, from Afghanistan to financial reform, he has come up short. Domestically, he has been naively committed to the fantasy of bipartisanship in Washington. His trip through Asia was a bust on any measure. The challenges are no less daunting in 2010.
Kicking the Can
Climate change, trade, Iran, financial reform. Big issues, little progress.
Lisbon Treaty
Europe finally got its act together and ratified the Lisbon Treaty, only to appoint two of the most underwhelming candidates on the international scene. The primacy of the nation-state persists in spite of Lisbon.
The Trouble with Elections
Elections in Israel, Iran and Afghanistan all complicated progress on major international issues in 2009. In Iran, the regime faces its most committed and prolonged challenge since the revolution.
Berlusconi
Just kidding!
