By Clay Chandler
January 27, 2018

It’s the end of the world as we know it—or so we’re told, not just by R.E.M., but also this week by the venerable Economist, which carries a lengthy special report pondering “The Next War.”

The issue’s lead essay warns that “powerful, long-term shifts in geopolitics and the proliferation of new technologies” are eroding America’s global dominance, obliging thinking people everywhere to think about the unthinkable. “Conflict on a scale and intensity not seen since the second world war is once again plausible,” the essay intones. “The world is not prepared.”

The Bulletin of Atomic Scientists, too, is sounding the alarm. On Thursday, the group moved the “Doomsday Clock,” its symbolic predictor of the likelihood of nuclear apocalypse, to “2 minutes to midnight.” The new setting is 30 seconds closer to catastrophe than last year, signaling that the world is as close to nuclear disaster, in the group’s assessment, as it has ever been.

The Economist, in highlighting higher risk of global conflict, cites the Pentagon’s new national defense strategy, which identifies “great power competition” between the US, China and Russia as the “central challenge to US prosperity and security.” The report deems China and Russia greater threats to US security than jihadism. (Fortune flagged that report for CEO Daily readers last week.)

The Economist cites North Korea as the world’s most immediate security flashpoint. But it twits US president Donald Trump’s refusal to uphold America’s traditional role as world leader as the main long-run threat to global stability. “Mr Trump says he wants to make America great again, but is going about it in exactly the wrong way,” Economist editors opine. “He shuns multilateral organizations, treats alliances as unwanted baggage and openly admires the authoritarian leaders of America’s adversaries. It is as if Mr Trump wants America to give up defending the system it created and to join Russia and China as just another truculent revisionist power instead.”

Strong stuff. Officials from the Bulletin of Atomic Scientists also decry American abdication of global leadership under Trump as a key source of global instability.

Trump’s decision this week to impose steep tariffs on imports of washing machines and solar panels did little to allay such concerns. A host of publications, including the BBC and Bloomberg, warned that, should push come to shove, China has many options for retaliation. Former Morgan Stanley economist Stephen Roach, in an essay entitled “How to Lose a Trade War,” decried Trump’s trade policies as “backward looking at best” and putting growth of the US economy at risk.

Trump as ever remains unfazed. In his speech to the World Economic Forum at Davos, to which he is the first US president to attend since Bill Clinton in 2000, the US leader declared that America’s economy is “roaring back” and “open for business.”

Enjoy the weekend!

Clay Chandler


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