Until as recently as 2015, there was (and still is) a growing sense that we are witnessing something of a transformation in the international order. Central to this contention are two distinct but often related issues, namely, that of the rise of a new South led by the BRIC ¹ (Brazil, Russia, India and China) countries, and the decline of the USA (albeit just a few years after being described by some as a unipolar power or empire). This small book accepts that there has to some extent been a rise of (parts of) the South, but suggests that this is more limited than is often claimed, and indeed goes further and suggests that the discourse of the rise of emerging powers is slowly—and rightly—giving way to one which focuses on a new emerging markets crisis. In order to contextualise this argument, the book suggests that the decline of the USA has been seriously exaggerated, and indeed that there is a close connection between the “rise” of the South, its limits (and partial “fall”), and the character of US power in the international order.

While some general arguments will be made to illustrate this case, the main focus will be on the question of political economy rather than geopolitics (or global governance). This is not to deny that geopolitics are very important, but the narrower focus on political economy is justified because much of the case around the rise of the South, and specifically China, and decline of the West, and specifically the USA, focuses on the supposed economic decline of the USA and economic rise of the South, the BRICS (including South Africa), and above all China. It is here that the book makes two distinctive, but related arguments. First, the political economy of “globalisation” ² reflects less the decline of the USA and more the USA’ continued but distinctive leadership of the international order ³ . This is an argument which has been developed by some writers from different theoretical positions, including Nye (2015), Ikenberry (2014) and Beckley (2011/2012) from a liberal internationalist position, and Panitch and Gindin (2012) and Saull (2012) from a broadly undogmatic (and perhaps unorthodox) marxian ⁴ position. What is distinctive about US leadership is that in some respects it is one that is integrationist, as it attempts to incorporate other states into a liberal international order. Seen in this way, liberal internationalists are correct to identify interdependence as a central characteristic of the current international order. On the other hand, my second argument however, develops and in some respects cuts across this first argument, because—as will become clear in what follows—while there is a tendency towards integration, we need to identify in some detail the specific forms of integration that occur and in particular shows how these are characterised by unevenness and inequality. We need to be clear here that this unevenness should not be confused with incompleteness, and rather show how unevenness is a product of cumulative inequality, rather than being a simple residual phenomenon which will be overcome through a process of catch-up and convergence. These very abstract and general points will be developed further in what follows, both generally, and in relation to the specific focus of this book, which is the alleged rise (and fall) of the South in recent years. On the face of it, the story of the recent rise would seem to suggests that interdependence has also given rise to convergence, but in what follows I will in fact argue that that there are good reasons why this supposed rise was based on a one-sided discourse, and even more, that we are now moving into a new period where we can talk less about the rise of emerging powers, and more about an emerging markets crisis. In doing so, the book will draw on both detailed empirical material and theoretical approaches from both international relations (IR) and development theory. In particular, in terms of theory, the book will suggest that notions of core and periphery in the international order remain useful concepts which, despite some problems, capture some of the realities of the changing international and global order. Concepts of core and periphery are often derived from world systems theory (Wallerstein 1974), and some versions of dependency theory, especially early underdevelopment theory (Frank 1969). There are some serious problems with these approaches and, I will suggest in the next chapter, with more recent approaches which draw on “global history” (Pomeranz 2001; Hobson 2004). In particular, there is a tendency to argue that the world is composed of a rather static hierarchical order, in which changes are “explained” by the overall needs of a hierarchical system. This is a functionalist argument which fails to deal with the specifics of change. When such approaches do recognise change, it is often through drawing on further spurious arguments, such as the idea that Asia has historically dominated the international order for all but the period from the early nineteenth century to the present, and now we are returning to a “normal” era of Asian hegemony (Frank 1998; Arrighi 2007). This again tends towards a view of history in which change is supposedly explained only through historical cycles, the specifics of which are lost in the analysis, and the implicit content of which is highly questionable. In particular, one of the secondary arguments in this book is to question the view that (insofar as it exists) Chinese hegemony is or would be more progressive than US hegemony. At the same time, this book does not accept the position of the liberal internationalists, insofar as it does not offer a normative apology for US hegemony. While this is secondary to the analytical account that follows, it should be clear that US hegemony is problematic and does indeed promote hierarchies and inequalities in the international order, even while it simultaneously promotes integration. What should be clear in what follows is that the integration that the USA promotes is both uneven and unequal, and indeed does lead to the promotion of cores and peripheries in the international order. This might not be the intention of US policymakers, even in problematic cases such as military intervention, which can be analysed in terms of integrating supposed non-integrators into “globalisation” (Barnett 2004). However, given the uneven and combined development of global capitalism, in which some countries, locations and regions develop through a process of cumulative causation (Kiely 2010), US hegemony often serves to relatively marginalise as much as integrate.

This argument would appear to be problematic given the rise of a number of large, and significant countries from the South in recent years. However, in the chapters that follow I will show how this rise has taken place within a wider context of uneven and combined development, and that the rise of the BRICs and fall of the USA was limited, and we are now entering a period of crisis for the South. Indeed, the 2008 financial crisis will be an important part of the analysis that follows. Much of the story of the rise of the South focused on the South’s seemingly rapid recovery, from 2010 onwards, in contrast to both the US crisis in 2008 and the Eurozone crisis from 2010 onwards. However, this book will argue that we are now entering a third phase of this crisis, and this is a crisis of emerging markets. Now of course this is a problem for the USA, and insofar as we might talk about US decline, this might refer to the US state’s seeming incapacity to manage the fallout from the 2008 crisis. However, in contrast to approaches which imply that the US decline is also China’s rise, and that the South has in effect delinked from the global North, it will be argued that this is a problem for all states and economies in the international order, including for the BRIC countries and the rest of the South.

This book therefore aims to do the following:

The book carries out these tasks in six chapters. Following this introduction (Chap. 1), the next chapter (Chap. 2) will provide a brief introduction to the idea of the rise of the South in recent years. It will then go on to examine the ways in which a number of theories of IR have attempted to explain this rise, and examine how implicit within these approaches is a particular understanding of development. The chapter will argue that, while in many respects problematic, the old development debate cast in terms of modernisation versus dependency theory remains a useful one, not least for analysing “the rise and fall of the South” in recent years. The chapter’s final section provides an initial and strictly preliminary illustration of this argument through a brief assessment of the BRICs and the South in the period up to 2008, suggesting that the question of desirability or undesirability of a new Chinese or BRIC hegemony is less significant than the fact that the rise of China and the BRICs and so-called transformation of the international order have been exaggerated. This final argument is then considered in depth in the rest of the book, focusing on the periods both prior to and after the 2008 financial crash. Chapter 3 starts by considering the question of globalisation, focusing in particular on the rise of multinational companies and global production networks. The chapter then considers whether these developments have led to some degree of convergence in the international economy through the diffusion of capitalism across the globe. The idea of a rising South can be considered one significant part of this process of diffusion. But the next section will qualify this argument, first by comparing US profitability overseas with US foreign debt ...