Cooperation vs. Competition in a World of Adversarial Power Centers

The world is moving toward a tri-polar configuration, with the United States, the European Union, and China dominating regional zones of influence while vying for global power. The pandemic, with its differentiated impact on each, has only accelerated centrifugal tendencies toward such a “triadic” configuration. The three power centers also represent different variants of capitalism which will shape how they set themselves apart. The tension between competing with each other and cooperating in the pursuit of the global common good, especially the zero-carbon transition, depends not least on redefining globalization in a more progressive, equitable, and stabilizing direction that leaves space for “live and let live” strategies of policy-making. Much of that redefinition hinges on how to manage an inherently more complex multi-currency system where the dollar, euro, and yuan represent alternative forms of world money. Different scenarios are possible, including coordination rules based on target zones for the key exchange rates all the way to anchoring the emerging international monetary system eventually on the International Monetary Fund’s Special Drawing Rights as a steadily more important, supranational form of world money.