Fateful Transitions. Daniel M. Kliman

and political parties essential to maintaining a governing coalition.³² To qualify as decentralized, a regime must contain at least three checks and balances. This threshold is based on the fact that no country commonly regarded as a democracy has less than three checks and balances in the database.³³ A regime qualifies as centralized when only a single check and balance exists. Two checks and balances indicate a transitional domestic power structure. The World Bank database has an inherent limitation: it only starts in 1975. However, the coding procedure is easily replicable for the historical case studies contained in this book.³⁴

      Freedom of the press provides a valid measurement of the level of transparency in a regime. The NGO Freedom House conducts a regular worldwide survey of state interference in the media that codes countries as free, partly free, and unfree. Since its inception, the survey has evolved to include twenty-three questions across three categories—the legal, political, and economic environments in which the media operate. A subset of the twenty-three questions suffices to capture how much freedom of the press a rising state permits.³⁵ This abbreviated survey for evaluating state control over the media contains six questions listed in Table 4.

       Conclusion

      Power transitions are fraught moments in international relations, yet they differ depending on the domestic institutions of the ascendant state. Democratic leaders at these pivotal junctures make strategic choices that ultimately hinge on the rising state’s type of regime, which determines the transparency of that state’s intentions and the existence of access opportunities. This critical insight has repercussions for today’s established and emerging powers. However, it is incomplete without a concrete grasp of how regime type has framed power transitions and influenced the formulation of strategy, an understanding that only history can provide. The next chapters explore six cases in which democratic states have confronted fateful transitions.

Table 4: Freedom of the Press

Legal environment

1. Does the constitution contain provisions designed to protect freedom of the press? (Y=0; N=1)

2. Do the penal code, security laws, or any other laws restrict reporting and are journalists punished under these laws? (Y=1; N=0)

Political environment

3. Are media outlets’ news and information content significantly determined by the government or a particular partisan interest? (Y=1; N=0)

4. Is there official censorship? (Y=1; N=0)

5. Are journalists or media outlets subject to extralegal intimidation or physical violence by state authorities? (Y=1; N=0)

Economic environment

6. Are significant portions of the media owned or controlled by the government? (Y=1; N=0)

Score: Free=0; Partly Free=1–2; Unfree=3–6

       Chapter 3

       Pax Britannica Eclipsed

      As the United States, Europe, and much of Asia navigate the rise of new powers, the British experience at the turn of the twentieth century is instructive. Although the Pax Britannica ended on the battlefields of the First World War, the eclipse of British power occurred earlier. Between 1870 and 1914, Great Britain steadily lost ground to two emerging giants: post-Civil War America and a unified Germany. This was the product of differential economic growth rates and the military capabilities such superior economic performance afforded. Once the United States and Germany surpassed Great Britain economically, its days as the world’s dominant maritime power were numbered.

      The unwinding of British primacy is more than a cautionary tale; it is the only period before the current era to feature a democracy and an autocracy rising in parallel. While democratic government in the United States reassured Great Britain, allowing for appeasement, the uncertainty and mistrust generated by Germany’s autocratic system compelled Great Britain to initially integrate and hedge. As growing conflict accompanied Germany’s continued ascendance, the British had no recourse but to abandon this dual strategy for containment. The eclipse of Pax Britannica amply demonstrates how regime type shapes fateful transitions and sets the boundaries for how democratic leaders formulate strategy.

       The Balance of Power

      At its apogee in 1870, Great Britain stood head and shoulders above all rivals. The British economy was the workshop of the world while the Royal navy ruled every ocean traversed by international commerce. Yet within little more than three decades, the balance of power had radically changed. Both the United States and Germany surpassed Great Britain in economic size and steel production and substantially closed the gap on all other indicators of national power.

      Gross Domestic Product

      British economic predominance evaporated at the turn of the twentieth century as the United States and Germany emerged as leading powers. Great Britain in 1870 had the largest GDP of any Western nation. The United States, with a GDP more than 98 percent of Great Britain’s, was close behind. Germany, a relative latecomer to the industrial revolution, had about 72 percent of Great Britain’s national wealth. Although Great Britain’s GDP increased from 1870 to 1913, the economies of the United States and Germany grew at a much faster pace. During this period, British economic growth averaged 1.6 percent annually, while the U.S. economy expanded at a per annum rate of 5 percent, and Germany grew at 4.7 percent.¹ Uneven growth rates brought about a marked shift in the distribution of national wealth. By the eve of World War I, Great Britain’s GDP ranked behind that of the United States and Germany. Having surpassed Great Britain in 1872, the United States by 1913 had an economic output equivalent to 230 percent of British GDP. Germany, starting from a smaller base, overtook Great Britain in 1908, and by 1913, had a GDP 5 percent larger.²

      International Trade

      British commercial supremacy, once beyond challenge, became increasingly tenuous as U.S. and German involvement in international trade expanded. In 1870, the volume of British trade exceeded that of the United States and Germany combined. The trade conducted by each of these states stood at 38 percent of Great Britain’s total. Between 1870 and 1913, British trade grew in absolute terms but experienced relative decline as the United States and Germany penetrated foreign markets traditionally dominated by Great Britain. U.S. exports to Europe, Japan, and China surged; German exports advanced in Europe, Latin America, and China.³ By 1913 the value of U.S. trade had grown to 73 percent of Great Britain’s, while German trade, rising even more rapidly, was 85 percent.⁴

      Military Expenditures

      Military expenditures (as opposed to naval expenditures) never constituted a major pillar of British primacy. Nonetheless, it is worth noting that on this dimension of national power, Germany, and subsequently the United States, closed an initial gap with Great Britain.

      Unwilling to provide for a large standing army during peacetime, Great Britain in 1870 only maintained a substantial lead in military expenditures vis-à-vis a likeminded power—the United States. For a decade and a half, U.S. military expenditures actually declined as a share of Great Britain’s, dropping from 65.9 percent in 1870 to 25.6 percent in 1885. This was the result of growth in British military spending coupled with U.S. demobilization following the Civil War.⁵ U.S. military expenditures rebounded thereafter. In the first half of the 1890s, per annum military allocations in the United States averaged 50 percent of Great Britain’s. The Spanish American War and the Boer War produced great volatility in each state’s military expenditures, so the period bracketing these conflicts is atypical. In the decade before the outbreak of World War I, U.S. annual military expenditures were about 91 percent of Great Britain’s.

      Unsurprisingly, Great Britain was never overwhelmingly predominant