This year is the 100th anniversary of the start of the first word war, the 70th anniversary of D-Day and the 25th anniversaries of the collapse of the Soviet empire and the savage crackdown around Tiananmen Square. One hundred years ago, Europe’s fragile order fell apart. Seventy years ago, the democracies launched an assault on totalitarian Europe. Twenty-five years ago, Europe became whole and free, while China chose market economics and the party state. We have now lived for a quarter of a century in an era of global capitalism. But the political and economic pressures of such an era are also increasingly evident.
In 1913, western Europe was the economic and political centre of the world. It generated a third of world output (even measured at purchasing power parity, which raises the shares of poor countries above those at market exchange rates). European empires controlled most of the world, directly or indirectly. European business dominated world trade and finance. While the US already had the largest integrated national economy, it remained peripheral.
The rivalry among the European powers tore this world apart. The war led to the Russian (and so subsequent) communist revolutions. It shifted power across the Atlantic. It left global economic stability at the mercy of the US, by then the world’s principal creditor. It decisively weakened the old imperial powers. It destroyed European self-confidence. What the first world war had not done, the Great Depression, Nazism and the second world war did. By the time of D-Day, the world economy had disintegrated, Europe was prostrate and the abomination of the Holocaust was under way. Disaster was complete.