Breathing new life into a rules-based system – a global strategy

This article is part of the World Economic Forum's Geostrategy platform

The United States and its victorious allies in World War II led the construction of the international system we inhabit to this day.

Following two devastating global conflagrations, they devised a system of rules and norms, backed by alliances and international institutions, which provided forums for states to settle political disputes and help societies rebuild from economic depression and war.

This rules-based international system proved successful beyond even the expectations of its architects. Over the past seven decades, the world has become much more peaceful, prosperous, and democratic than at any time in history.

Yet, today, this system faces new challenges. The global distribution of power is shifting. Revisionist, autocratic states seek to disrupt or displace the existing system. Authoritarian state capitalism is challenging the Western model of free markets and politics as the best way to order society.

Disruptive technology

In addition, new issues, such as emerging disruptive technologies, have arisen for which the original system was never designed. Across the West, there is a loss of confidence in its own political model. Growing inequalities are leading many to question open-market economics and provoking a backlash against global engagement.

All of this is taking place as the leading champion and defender of this order, the United States, is revealing increasing uncertainty about both its ability and willingness to continue to play its traditional role in advancing the rules-based system.

In the face of these challenges, many analysts have suggested that the rules-based system as we have known it is destined to deteriorate. According to this argument, the United States and its democratic allies and partners no longer have the global influence, nor the domestic political backing, to decisively shape outcomes internationally. They conclude, therefore, that the United States and its allies have no choice but to scale back their global ambitions and find ways to accommodate rival great powers in a new, less liberal, world system.

Others contend that the recent troubles with the rules-based system can be attributed largely to short-lived political disruptions, such as the populist wave sweeping across many democracies around the globe. Once these temporary obstacles pass, this narrative suggests, the United States and its allies can dust off the old playbook and return to the traditional model of doing business.

Both of these viewpoints are misguided.

The post-World War II order has proven unmatched in its ability to provide for global peace, prosperity, and freedom. It would be unwise to abandon it—or significantly reduce its scope—because it is coming under new strains. At the same time, it is impossible to return to a world that no longer exists.

Global conditions have fundamentally changed, and it makes little sense to cling to a static and dated system in the face of new realities. The United States and its democratic allies must find a new way forward that steers between these alternate dangers of defeatism and nostalgia. This strategy paper advocates for the revitalization, adaptation, and defence of a rules-based international system.

Liberal values

Instead of retrenchment, the United States and its allies and partners around the world must double down and seize the current moment as an opportunity to expand and deepen a rules-based international system, grounded in liberal norms and values.

Indeed, despite common misperceptions to the contrary, the United States and its extensive network of allies and partners continue to possess the preponderance of power necessary to advance a liberal, rules-based system.

In addition, democratic publics are much more willing to support global engagement than conventional wisdom suggests, provided that leaders lead with a compelling vision for the future.

A rules-based approach can continue to function and even flourish, but a new strategy is required. The task ahead for those of us “present at the re-creation” is to translate the enduring principles on which the postwar order was constructed into a significantly redesigned system capable of meeting the challenges and opportunities of the twenty-first century.

First, the United States and its democratic allies must act to revitalize support for the principles of a rules-based system. A sustainable global system will require reaffirming democratic values and deepening cooperation among the world’s democracies, while at the same time building an inclusive framework that ensures that all major global powers, including China, can contribute to and benefit from the system’s success.

In a revitalized system, the United States should continue to lead, but it will ensure a favorable balance of power for the free world by more proactively linking together and driving collaboration among its democratic allies and partners. These core democratic powers, united around the new Declaration of Principles, should take the mantle to collectively advance and steer a revitalized rules-based system. They should be joined by the world’s rising democracies, such as India, Brazil, Mexico, and South Africa, to work more closely together to advance and defend the common values that unite them.

Democratic publics, especially in the United States, must be convinced of the benefits of committing the resources necessary to maintain global leadership. At the same time, such a system must extend beyond the democratic core to seek the active participation or, at a minimum, the acquiescence of autocratic great powers.

Like it or not, Russia and China have the power to disrupt the functioning of an effective system, and they must be made to see the benefits of contributing to a peaceful and stable global system.

Fundamental values

The free world should work with Russia and China to identify shared norms and principles, and to forge an agreed-upon set of international rules. The free world can, and should, pursue hardheaded engagement without compromising its fundamental values.

This strategy paper, therefore, advocates a two-track approach. The integrated democracies of the free world should provide consistent and principled systemic leadership to advance a rules-based system, while seeking to identify common interests and extend areas of cooperation to a more inclusive group of global powers.

Second, the rules-based system of today needs to be significantly adapted and redesigned to address existing shortcomings and reflect new realities, including the diffusion of global power and emergence of disruptive technologies.

The United States and its democratic allies need an ambitious effort to re-create and update, not abandon, the institutions uniting the system’s democratic core.

This paper calls for adaptations including: reinventing the Group of Seven (G7) as a new elevated “D10” that will serve as a steering committee of democracies; forging a new, global, and formal Alliance of Free Nations (AFN); and negotiating a Free World Trade Agreement (FWTA) that will link the economies of the democratic world.

At the same time, the interests of all states, including autocracies, must be represented in a revamped global system. This is not a strategy focused on institution building in the democratic world to the exclusion of autocracies. On the contrary, it is necessary to build an inclusive order that brings in other major powers.

The Group of Twenty (G20) should take on an expanded role as a global decision-making body on a wider range of political, economic, and security matters. New dialogues should be established within the G20 framework for major powers to find common ground on new technology and on reforming the global trading system.

Meanwhile, the United Nations—particularly the Security Council—should continue to serve as a universal forum for dialogue and cooperation among all states. With both tracks firmly grounded in a revitalized international system, leading global powers can begin to develop the new rules and norms necessary to meet the demands of the twenty-first century.

Finally, this revitalized and adapted system must be defended.

Leading powers need to put in place a more systematic approach to monitor compliance with core rules, incentivize state compliance with these rules, and develop measures to punish major challengers to the system. In the near term, this will mean that the democracies at the core of the rules-based system must ramp up for a new era of great-power competition. They should also defend democracy against autocratic backsliding and interference.

At the same time, a larger group of global powers must seek to cooperate to confront the dangers posed by nuclear proliferation, terrorism, disruptive technology, and other global threats.

The strategy set forth here may strike some as unrealistic. However, the approach does reflect current geopolitical realities and is well-suited to address them. The United States and its allies and partners retain the capability and the domestic political support to lead a revitalized international system, and Russia, China, and other major powers will find that their interests will be better served by engaging with, rather than being isolated from, this effort.

At the end of the day, this strategy will succeed if it is able to convince all major states that their interests are best pursued within a rules-based system. Not only can they expect substantial benefits for participation within the new system, but they will know that any significant efforts to challenge or undermine the system will be futile.

Present at the Re-Creation: A Global Strategy for Revitalizing, Adapting, and Defending a Rules-Based International System, Ash Jain and Matthew Kroenig, the Atlantic Council