Economic Power

Shortly after the British Empire vanquished the German Empire in the first world war the people responsible for the defence of the realm looked around the world to locate the most likely next threat. They did not have to look far. Communism might have been seen as a political threat following the Russian revolution but it was the military might of the Americans that was of grave concern.

Already, America had the second largest navy after Britain and it announced that it intended to have the most powerful navy as soon as possible. An arms race developed apace as each country introduced ships with greater range. In those days it was the distance one could fire a shell that mattered. If you could sink an enemy ship before it could fire at you – you had the advantage. It got to the point that a ship would be out of date as it was being built. The race could have ended up bankrupting both countries.

In the end they signed a treaty, along with other naval powers, to limit the size of their navies. Some say America won because the treaty allowed them a navy the same size as Britain’s. Others say that Britain won because it was able to limit the size of America’s navy via the use of a treaty. One could argue that common sense won as money could be spent on more useful things such as housing and health.

Today the constellation is different. The British Empire has gone; instead we are part of the European Union. America might still have the most powerful military – since they spend more on their forces than the rest of the world put together. But in Economic terms Europe is ahead of America. When it comes to the climate change debate European policy can have the edge. There is little surprise that Europe has been able to take the higher ground on climate change. What might surprise people is that quietly, behind the scenes, Europe is changing the facts on the ground when it come to industrial policy linked to climate change. America, with or without China will have to follow suit – however reluctantly or slowly.