History’s new era: the Dollar, Euro and the Age of Revolution

Singapore authorities like to compartmentalize Singaporeans into four basic categories: Chinese, Malay, Indian and others. Consequently, all Singaporean individuals are subsumed into one of the four racial groupings. Such cataloguing helps make order out of seeming incoherence. 

Historians resemble policymakers in the area of 'convenient labelling.' Historians tend to break history down into periods, e.g. the Middle Ages, the Age of Industrialization, etc. Additionally, historians are forced to pick out specific events as turning points – that time when the old disappeared and the new entered.

The world has reached a turning point in history. The post-World War Two period is over and a new era has begun.

Following the defeat of the Axis (Germany and Japan) by the Allies [United States and the Soviet Union (USSR)], in 1945, the world settled into a rhythm dominated by the US and the USSR. The US was ably supported by its client states in the 'Free World.' The USSR was supported by Soviet client states particularly in Eastern Europe.

The post-war time was an age of decolonization and optimism. Individuals, revolutionary and otherwise, fought to change the world. Revolutionaries like Che Guevara spawned during these years. Red terror pitted itself against white terror in many parts of the world, especially Latin America and sub-Saharan Africa. Martin Luther King's  civil rights movement had its day.  

USSR stamp demanding freedom for African nations and peoples (1961)

Surely, there were some appalling moments in the post-war era.

The world came close to destruction during the 1962 Cuban Missile Crisis. Conventional wars and insurgencies were commonplace. Deaths from disease, famine and natural calamities make contemporary disasters seem almost merciful by comparison.

Nevertheless, for historians and the 'powers that be' the world was sane and for the most part politically predictable. The rules attached to the theory of Mutually Assured Destruction were respected by both the USSR and the US.

The world remained balanced on its axis.

Then the economic inefficiencies of communism came to the fore. Soviet military power surrendered to a virtually bankrupt economy, tipped over the edge by the decade long Soviet occupation of Afghanistan (1979 – 1989).

Consequently, the post World War Two Russian Empire collapsed. Communist regimes and Soviet dependencies broke away from Moscow's rule and created independent nation states. The United States revelled in the glow of victory. The Cold War was over and the US became an unrivalled global power.

Unfortunately for the US, the nation's unsurpassed global dominance is decaying. By many metrics, the US economy's global dominance is not nearly as sharp as a few decades ago. The US Dollar's status as reserve currency is in decline. Moreover, the Global War on Terror, along with its two major 'subplots' in Iraq and Afghanistan, has taken a toll in the US economy.

The world is changing in many other ways.

Much has been written about Asia's ascendancy. The term 'Asia's Century' has gained currency.

The Islamic world is in political chaos. Secular nationalists have been discredited after decades in power. Islamic ideologues have stepped in to fill the ideological void. Even Turkey with its powerful military jealously guarding Kemalist principles could not prevent the dilution of its secularist republic.

Europe has come a long way from Monnet's European Coal and Steel Community in the 1950s. However, the continent has reached a new defining moment in the form of the European debt and Euro currency crisis. Europe's immediate future threatens to unravel its recent post-war history.

Economically, the Bretton-Woods system is dead. The International Monetary Fund exercises limited influence over the world's economy at just the time such control is most required. Economic power centers are gravitating away from traditional post-war geographies.

The Post World War Two era is over. A new era is in the works. What exactly will characterize the new era is difficult to state with certainty. However, several decades from now historians will surely be searching for an appropriate label. For some reason, the Age of Revolution comes to mind.

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Imran is a business and management consultant. Through his work at Deodar Advisors, Imran improves the profitability of small and medium sized businesses operating in Singapore and the region. He can be reached at imran@deodaradvisors.com.