Biden leads America back onto a world stage that is no longer the same

US president-elect Joe Biden has pledged to reverse many of the “America first” policies of Donald Trump (who in turn overturned the more outward-looking policies of Barack Obama). This implies that globalisation could make a comeback – but it does not mean a return of the status quo ante.

“The message is: America’s back,” Biden declared at a rally in Wilmington, Delaware. That is a welcome change indeed from Trump’s dismal isolationism. But the United States is coming back onto a stage where the actors and props have been moved during the interval, in readiness for a new act.

It is not a stage where America is any longer guaranteed the role of lead actor or where capitalism is the hero and socialism the bit player. It is, rather, one where rival players need to find a new modus vivendi and to cooperate for the benefit of the whole cast, the global community.

Four years have passed since the world came under the baleful influence of Trump as leader of the “free world”. That is not long in political terms (although it feels longer) but, still, a lot has changed since 2016 when Trump first bestrode the world like a destructive colossus.

It is worth pausing to consider just how much has changed. The world has plunged into its worst economic recession since the second world war and faces a long, hard struggle to climb out, even if the Covid-19 trial vaccines prove their worth and become freely available.

Government intervention in economic affairs (not exactly a symbol of doing things the so-called American way) has become very pronounced during the Trump years as governments spend trillions of dollars on propping up economic activity.

In a report last week titled “The State Strikes Back”, the European Bank for Reconstruction and Development said that this “reflects both the trend towards growing acceptance of state involvement and the increased expectations that are now being placed on the state.” The International Monetary Fund has expressed similar sentiments.

Economic systems and their stability (or sustainability) have been put to a severe test during the Trump era, chiefly by the pandemic but also by blows inflicted in a futile US attempt to reassert American economic supremacy (or “greatness”) through weakening competitor nations.

Trade and investment wars, along with the pandemic, succeeded in achieving this latter objective in many countries (especially Britain, which seemed hell-bent on self-destruction under Trump ally Boris Johnson and Brexit). But China did not cave in under pressure and continued to grow.

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China is forecast to emerge this year as the only major economy to show positive growth when most others are deep in recession. It will not go unnoticed by the rest of the world that China’s economic management seems virtually fireproof even if other aspects of its polity are not universally admired.

Nor has China’s success in containing Covid-19 (after an initial cover-up) escaped attention, especially against a background of abject failure in the case of the US. Race issues and then election chaos have not helped that country’s image, either.

To mention all this is not to further tarnish America’s reputation. This is one area where the Trump-led nation has done a “great” job on its own. But any attempt by Biden to reassert leadership on the basis of past US greatness once he comes on stage will be met with polite coughs.

He will need to proceed with humility and statesmanship – qualities which, fortunately, Biden is said to possess in good measure. And, unlike US vice-president Mike Pence, Biden’s deputy, vice-president-elect Kamala Harris, does not have a reputation for China-bashing.

Pence’s loud and repeated allegations that China used “debt diplomacy” to ensnare developing economies into borrowing more than they could repay to finance infrastructure projects, and then seized their strategic assets as loan collateral, have met with considerable resistance recently.

What did happen under Trump was the formation of a US-led front against China’s Belt and Road Initiative, with the so-called Quad powers – the US, Japan, India and Australia – devising counter-initiatives for infrastructure projects that have yet to see a foundation stone laid.

Biden will need to do more than simply take the US back into the World Trade Organization, the World Health Organization, the Paris climate accord, and the like – very welcome though such intentions are. He will need to demonstrate that the American economic model is still viable and capable of attracting followers post Covid-19.

He will need, as Harvard scholar Graham Allison suggested in a Centre for China and Globalisation webinar, to reconcile the “Thucydides Trap” that the US and China are facing, with the fact that a Peloponnesian-style war between the two lead nations would ensure mutual destruction. The curtain needs to rise on a new era of cooperation.

Anthony Rowley is a veteran journalist specialising in Asian economic and financial affairs