Regional Sub-System: United States of America

Number of federal states: 51 (2006, inc. DC)
Population:
256,514,000 (1992)
296,410,000 (2005) 15.6% increase (high immigration)

Regional GDP/capita (current US$)
$24,070 (1992) 115% of Western Europe
$41,844 (2005) 129% of Western Europe
12% relative growth (compared to Western Europe)

The United States is often touted as a superior example of societal-system performance. Since the end of the Cold War and the dissolution of the Soviet Union, it has also been commonly referred to as the world's "leading democracy" and only "superpower." Whereas serious questions remain as to whether the United States serves as an attainable, or sustainable, model for the aspirations of other states, regional sub-systems, or the global system as a whole, the United States does exhibit unquestionable levels of achievement in many aspects of complex societal-system performance. Among its achievements are a leading role in global technological progress; high levels of societal integration and the continuing integration of minority groups; stable democratic institutions of governance at all levels of administration since 1871; almost no major, intra-state, political violence since 1946 (and low levels since 1865); and the world's highest level of income among major societal-systems. Perhaps most remarkable is the almost perfect equality of incomes among its fifty + one constituent, federal states (see Lorenz curve above).

Societal-Systems and Income Distribution: In order to gain a systemic perspective on development in the globalization era, we use an approach termed "comparative regionalism" (see Chapter 6, Third World War). "Neighborhood" or "spatial-clustering" effects, both good and bad, have been documented in our continuing systemic research and these have substantial influence on the prospects for any unit in a societal-system. In the most general terms, we have found evidence of a fundamental congruence among qualities of conflict, governance, and development in societal-systems. The best performing systems are characterized by low levels of violent conflict, democratic governance, and strong economic performance; middling performers have medium levels of violent conflict, autocratic rule, and limited societal integration and economic performance. The poorest performers are characterized by high levels of violent conflict and insecurity, incoherent and unstable (anocratic) forms of governance, societal polarization, and stalled and distorted systemic development.

The comparative regionalism is approach examines global and regional income distributions by constructing Lorenz curves, which plot the cumulative proportion of income by constituent societal units; at the regional level, these units are independent countries with population greater than 500,000. The (formal economy) income shares of the units (ordered from poorest to richest) are plotted against the cumulative proportion of their population in the greater societal-system. The "line of equality" is a diagonal line drawn from the point of origin (0,0) through the end point (1,1) on the graph; this is the line that results if every unit's proportion of the system's total income is the same as their proportion of the system's total population. If some units have a lesser or greater portion of system income for their populations, the plotted Lorenz curve will fall below the line of equality. The degree of inequality in systemic income distribution can be seen, and measured, as the area of divergence between the line of equality and the plotted Lorenz curve. The greater the area between the line of equality and the observed Lorenz curve, the greater the disparity in income among the countries in that system, incongruence among their political values and perspectives, and lack of systemic integration (even though the density of political interaction among units may be quite high). This approach allows us to measure system disparities and track system integration (i.e., increasing societal-systemic networking and the lessening of disparities among units within the system) over time. Plotting the income distributions of the several regional sub-systems that comprise the global system allows us to compare well-performing regions with regions that have been performing less well; it also allows us to monitor differential dynamics and gain a better understanding of the prospects for the global system as a whole.

The Lorenz Curve diagram above plots the 2005 income distribution of the fifty states (and District of Columbia) that constitute the United States of America. The Lorenz curve shows an almost perfect equality among constituent units in the system. Only data for the year 2005 is displayed because the income distribution has been quite stable (invariant) over time. Of course, equality among system units does not mean there is equality among individuals within the units. Quite the contrary, the income distribution among individuals in a well-performing societal-system can be relatively unequal. The Gini Index measure of individual-level inequality for the United States in 2005 was 40.8 (a medium score); Western European states have some of the lowest Gini Indices reported by the World Bank, ranging from a low of 24.7 for Denmark to a high of 36.0 for Italy and the United Kingdom.

Regional Sub-System: European Union

Number of confederal states:
Western Europe: 11
Expanded European Union: 28 (inc. 5 candidate states, 2006)
Population:
345,372,000 (Western Europe, 1992)
362,306,000 (Western Europe, 2005) 4.9% increase
567,002,000 (Expanded European Union 2005)

Regional GDP/capita (current US$)
$20,926 (Western Europe, 1992)
$32,372 (Western Europe, 2005)
$24,326 (Expanded European Union, 2005)

Western Europe provides a second example of a well-performing regional societal-system. Emerging from the dismantling of the Euro-centric imperial world system following the catharsis of the Second World War, the eleven Western European states have been able to transform their regional societal-system to allow greater systemic integration and follow the example of the United States to approximate that system's high level of performance. The regional profile for the Western Europe sub-system (i.e., states that formed the original European Community) shows a high degree of income equality among constituent units that has continued to improve since 1958. The profile of income distribution (above) plots Lorenz curves for 1992 and 2005 for Western Europe (the two curves closest to the "line of equality"). In addition, the diagram plots the 2005 Lorenz curve for the expanded European Union (twenty-eight units, including the three candidate countries Croatia, Macedonia, and Turkey). Expansion into Eastern Europe, especially the accession of Turkey with its large and relatively poor population, dramatically alters the income distribution of the regional system. This illustrates one of the sources of tension that has characterized accession negotiations with Turkey over the past several years and has, more generally, increased debate and disagreement among the key states in the European Union over tighter policy and financial integration (not to mention a strong, zenophobic reaction among nationalists). We argue that high degrees of internal trade and exchange among constituent units in a system serve to equalize income among units over time; this process is strengthened by redistributive policies enacted by central administration in strongly integrated societal-systems. Indeed, in the US and European regional systems, the volumes of trade and transactions among constituent units are much higher than the volume of trade and transactions with units outside the regional system.

Regional Sub-System: South America

Number of states: 12 (2006)
Population:
307,320,000 (1992)
375,679,000 (2005) 22.2% increase

Regional GDP/capita (current US$)
$2,765 (1992)
$4,042 (2005)
-5.5% relative growth (compared to Western Europe)

A third example of a reasonably well-performing regional system is found in South America. The systemic distribution curves for South America show substantial improvement in income distribution among the countries of that region, particularly due to improved economic performance in Brazil, despite general instability triggered by the 2001 financial crisis in Argentina. As mentioned, this region has experienced relatively low levels of political violence during the contemporary period and has witnessed a resurgence and consolidation of democratic governance since the end of the Cold War (only Venezuela scores lower than +6 on the Polity scale; its regime rating dropped to anocracy due to a further concentration of executive power under President Chavez's initiative to create a one-party state). On the other hand, only Chile (beginning in 2006) and Uruguay are rated as "fully institutionalized democracies" (with Polity scores of +10). Similar to the US and European regions, South America has a relatively high density of trade and transactions among its constituent units. One corollary of the 2001 financial crisis is that income growth for the region has fallen behind the standard set by the Western European countries (-5.5%). Income distributions within states in the South America region are also more unequal than those in Western Europe and the United States; Gini Indices for South American states range from a low of 43.2 in Guyana to a high of 59.1 in Brazil. This skewed distribution of income within South American countries sets the basis for the strong and pervasive movement toward democratic populism across this region during the first decade of the new millennium.In the past, such populist pressures often triggered a forceful and autocratic response from an alliance between a politicized military and economic elites. So far, since the end of the Cold War, South American militaries have been less willing to engage actively in regulating political authority.

Regional Sub-System: South and East Asia

Number of states: 22 (2006)
Population:
2,895,808,000 (1992)
3,335,721,000 (2005) 15.2% increase

Regional GDP/capita (current US$)
$545 (1992)
$1,520 (2005)
80% relative growth (compared to Western Europe)

Middle-performance regional systems are found in Central America and Asia. The Central America (not shown) and Asia regional subsystems show moderate integration. The Asia regional profile provides an example of a historically less well-performing sub-system, but one which has made substantial progress in the post-Cold War, globalization era. It is home to some of the world's largest and most densely populated countries and in 1992 it had the lowest GDP per capita of all the world's regional sub-systems; even lower than sub-Saharan Africa. (The well-performing island states of Australia, Japan, and New Zealand are not included in this analysis of the Asia regional system; there is no data for Myanmar, North Korea, or Taiwan.) The Asia region has experienced fairly high levels of armed conflict throughout the contemporary period, and before (it was a major arena of the Second World War). It is unique in that the overall level of armed conflict has not fallen much with the end of the Cold War. While warfare has diminished substantially in East, Central, and Southeast Asia, it remains relatively high in South Asia (home, also, to the world's poorest nuclear powers). Asia is also home to some of the world's most reclusive states, including Bhutan, Laos, Myanmar (Burma), and
North Korea; Cambodia, China, and Vietnam are only now beginning to emerge from their isolation. Formal trade and transactions among states comprising the Asia region have been and remain quite limited. Until recently, trade and transaction densities have been concentrated in the Asian "tigers" located around the periphery of the region (South Korea, Taiwan, and Singapore). The recent, rapid economic growth of the People's Republic of China is increasing regional economic penetration but maintaining the region's focus on external trade and the global, rather than regional, market. Governance in Asia was characterized mainly by autocratic regimes during the Cold War period, with the notable exception of India. Governance in early 2007 is characterized by about an equal mixture of autocratic, anocratic, and democratic regimes. Nearly all the improvement in the regional income distribution in Asia during the globalization era results from the rapid growth of the economy of mainland China. Growth in per capita income for the Asia region, as a whole, has nearly doubled relative to that of the Western European states. This is what we should expect for poorer sub-systems that are "closing the income gap" with the more wealthy regions. However, the Asia region stands as an exception in this regard as there is little evidence of such "closing" in the other, non-Western, regional systems.

Regional Sub-System: Sub-Saharan Africa

Number of states: 34 (2006)
Population:
456,092,000 (1992)
632,506,000 (2005) 38.7% increase

Regional GDP/capita (current US$)
$613 (1992)
$875 (2005)
-8.0% relative growth (compared to Western Europe)

The world's poorest performing regions are those in Sub-Saharan Africa and the forty-one countries comprising the swath of Muslim Countries extending from the northwest coast of Africa to the Indonesian archipelago. The most troubling regional sub-systems in the globalization era are the region constituted by the sub-Saharan (non-Muslim) African countries and that of the pre-dominantly Muslim countries (i.e., countries in which 50% or more of the population professes an Islamic faith). The Lorenz curves for these two regional systems are (surprisingly) roughly equivalent; income inequality among African countries is only slightly greater than income inequality among Muslim countries.

The poor-performance of the Sub-Saharan Africa region is well known. The region experienced some high level warfare during the de-colonization period, 1955-1980 (i.e., wars of independence, particularly in Algeria, Angola, and Zaire) and has been beset by many intense, and often brutal, civil wars during much of the post-independence period. Although the general magnitude of armed conflict in the region has diminished substantially since the end of the Cold War, the overall decrease in warfare in Africa has fallen more slowly than the general global trend and warfare remains a serious concern in east and central Africa. In contrast, the southern tier of countries in Africa has shown evidence of remarkable improvement since the end of the Apartheid regime in South Africa (except Zimbabwe). The Sub-Saharan Africa region has been ruled for much of the contemporary period by, often predatory, autocratic regimes; democratic experiments were relatively rare and usually short-lived. Since the end of the Cold War, autocracy has nearly disappeared in Sub-Saharan Africa, falling by eighty percent in a very short period of time. However, democracy has been very slow in emerging in Africa and most countries are seriously hindered by societal polarization and contention; there are no fully institutionalized democracies in Africa (except the small island state of Mauritius). Electoral politics in African countries are very often dominated by a single party, usually organized around a personalistic leader. Much of the democratization in this region may be characterized as "premature" or "incomplete" as the region generally lacks the level of societal development found to be important in sustaining democratic forms of governance. The recent embrace of electoral politics in the region largely reflects the region's high dependence on external assistance and its susceptibility to the influence, and pressure, of the donor countries. The sub-Saharan Africa region was the poorest region in the world system in 2005 and the region's "income gap" widened by nearly ten percent relative to the Western European countries since 1992. Like the Muslim Countries region (discussed below), the Sub-Saharan Africa region shows a worsening income distribution among constituent states during the globalization era, comparing 1992 and 2005. Of even greater concern is the fact that levels of formal trade and transactions among the states within the region are extremely low and show few signs of improvement. Inter-regional trade accounts for between five and fifteen percent of total trade fo the region. Sub-Saharan Africa remains heavily dependent on extra-regional export trade in primary commodities; manufactured goods account for less than twenty percent of total export trade. Given the lack of societal networking and integration, the problem of marginalization of social groups is severe and this further exacerbates conflict, governance, and development challenges. The high degree of marginalization in the region has contributed to the large number of genocides, politicides, and humanitarian disasters that have continued to plague the region. The discovery of oil reserves in some countries has further complicated the region's distorted, system dynamics and increased, already strong, external pressures on generally weak states governing societal-systems in serious disarray.

Regional Sub-System: Muslim Countries

Number of states: 42 (2006)
Population:
888,226,000 (1992)
1,146,457,000 (2005) 26.3% increase

Regional GDP/capita (current US$)
$1,166 (1992)
$1,985 (2005)
10% relative growth (compared to Western Europe)

The poor-performing regional system comprised by the world's Muslim Countries causes the greatest concern as it has the strongest extra-regional tie-ins due to its expanse across the Eastern Hemisphere, large population, and possession of vast, and highly coveted, oil reserves. Generally, when we consider the Muslim countries, our interest is strongly influenced by a preoccupation with the region's relatively wealthy, oil-producing states and the protracted Arab-Israeli conflict. Consideration of the region's grinding poverty and seriously unequal, systemic distribution of income is often ignored or overlooked as major contributors to the region's past and present volatility, and future prospects. (This region overlaps with the Asia region analyzed above; both regions include Afghanistan, Bangladesh, Indonesia, and Pakistan. In addition, the European Union region shares Turkey with the Muslim Countries region.) The Muslim Countries have experienced the highest levels of armed conflict, both societal and interstate, of all the world's regional systems during the contemporary era. Regional armed conflict levels grew especially high in the late 1970s, continuing through the end of the Cold War. Levels quickly diminished by over 80% in the 1990s but have showed signs of resurgence in the past few years, particularly due to an increase in interstate war associated with the "al Qaeda" movement. The Muslim Countries comprise the only region to show a substantial increase in general levels of warfare in the new millennium. The Muslim region has been ruled for much of the contemporary period by strongly autocratic regimes; democratic experiments have been relatively rare and usually short-lived. The Muslim region has the highest number of autocratic regimes in early 2007 (fourteen). Regime type is associated with patterns of oil production: twelve of the Muslim autocracies are net oil producers (only two autocracies remain among the non-oil producing Muslim countries; these are Uzbekistan and Morocco). There are no democracies among the net oil-producing states in either the Muslim or African regions. In 2007, there were eight democracies in Muslim countries (scoring +6 or more on the Polity scale). Muslim democracies, such as Indonesia, Senegal, and Turkey, dot the periphery of the region. Regional income in the Muslim Countries region is substantially higher than that of the African region and has increased by ten percent relative to Western Europe between 1992 and 2005, seeming to narrow the "income gap" somewhat. This apparent improvment in regional development is accounted for by the dramatic increase in oil revenue; without this factor, relative income growth would be stagnant at best. Despite the relative increase in income from oil, the region shows a worsening income distribution among constituent states during the globalization era. Of even greater concern is the fact that levels of formal trade and transactions among the states within the Muslim region, as in Africa, are extremely low and show few signs of improvement. Inter-regional trade in each region accounts for between five and fifteen percent of total trade. These regions remain heavily dependent on extra-regional export trade in primary commodities; manufactured goods account for less than twenty percent of total export trade.

The Global System

Number of states: 162 (2006)
Population:
5,292,000,000 (1992)
6,299,229,000 (2005) 19.0% increase

Global GDP/capita (current US$)
$4,584 (1992)
$6,943 (2005)

(Re)considering the Global System and the Prospects for Effective Global Governance. The global system as a whole is an emerging societal-system that is highly complex and poorly understood; it is much more than the sum of its parts. This report hopes to establish baseline conditions as a starting point for better understanding the prospects for stability and change in the global system.The discussion above brings together regional profiles of the "parts" of the system in order to gain a comparative perspective on "relative income" and "relative growth" among the regional sub-systems that comprise the global system. The income distribution profile for the global system, then, presents a very real sense of "shock and awe" of the challenges and opportunities confronting political leaders in the early years of the emerging "globalization era." The global system as a whole is a societal-system in which income production is highly concentrated and centralized; a system that is profoundly split into "Haves" (about 15% of the global population) and "Have-nots." As of 2005, eighty percent of the population accounted for less than twenty percent of formal production income. It would seem that the potential for polarization and factionalism in such a system is quite high and, given the evidence that the "income gap" is narrowing only slowly if at all, will remain high for the foreseeable future. The policy implications of this examination can be summarized in a single phrase: extreme caution. The information and communication revolutions have created powerful tools that, like all tools, act as "double-edged swords": they enable and empower not only the world's elites and the advocates of globalization but also the demagogues of discontent and disintegration. If there is one thing that most clearly distinguishes the globalization era from preceding eras, it is the speed of and potential for social mobilization. Opportunities for freedom and growth are created when policy effectiveness and political legitimacy stand together; serious challenges are created when they drift apart or, worse, when they fall in unison. The United States has grown slightly wealthier per capita than Western Europe in this period, as have Central America, and the Muslim Countries. However, the more striking trends are the remarkable relative growth in Asia, driven by China's emergence as a major economic power, and the relative declines in income in South America and sub-Saharan Africa. The emerging era of globalization begins, then, with three important challenges: One is the sharply increasing number of 'anocracies,' which denote a transitional and potentially unstable stage on the way to more stable democratic governance (or state failure). A second is the large, and in many cases growing, gap in income among countries within the world system, and within certain regional sub-systems. A third is the disruptive potential of growing dependence of the wealthier countries on petroleum (and the corollary, but as yet unknown, effects of global climate change); this too needs to be accepted as an imperative, global dilemma, requiring a cooperative and coordinated global solution. The top priority for Global Governance must be the promulgation of a comprehensive global energy policy.Given the severely unequal distribution of income in the global system, the prospects for even greater systemic polarization are profound and, with it, the prospects for autocratic relations based on power discrepancies among constituent states, the dangers of military confrontation and war, and arrested and distorted systemic development. The challenges to peace are enormous. In order to manage these challenges, the will to peace must be boundless, and fearless in speaking truth to power. Peace is not a gift nor an idyllic state of being, it is the logical result of an educated, informed, and innovative population, proactively engaged at all levels of societal-systemic organization, who reject force, violence, and war in the pursuit of opportunities, resolution of disputes, and solution of problems.