NYPD agents detain a protester in a protest during the 2020 presidential election in New York.
Photographer: Stephanie Keith / Bloomberg
Photographer: Stephanie Keith / Bloomberg
With the world economy still on the brink of the Covid-19 crisis, the Eurasia group sees the divided United States as a key risk this year for a world without leadership.
“In decades to come, the world would look to the United States to restore predictability in times of crisis. But the world’s preeminent superpower faces major challenges, “said Eurasian Group President Ian Bremmer and President Cliff Kupchan in a report on key risks for 2021.
Starting with the difficulties facing the Biden administration in the divided United States, the report marks 10 geopolitical, climate, and individual country risks that could derail the global economic recovery. A second expanded Covid-19 impact and K-shaped recoveries in developed and emerging economies is the second largest risk factor cited in the report.
Biden will struggle to gain new confidence in U.S. global leadership as he struggles to manage national crises, according to the report. With a large segment of the U.S. questioning its legitimacy, political effectiveness, and the longevity of its “asterisk presidency,” the future of the Republican party and the very legitimacy of the U.S. political model are at stake, added.
“A overthrown superpower cannot return to business as usual. And when the most powerful country is so divided, everyone has a problem, “said Bremmer and Kupchan.
The report covers the following main risks in 2021:
| Main risks 2021 | |||
|---|---|---|---|
| 1. | American presidency | 6. | Cyber conflict |
| 2. | Covid-19 extending to 2021 | 7. | Turkey |
| 3. | Implications of net zero emission targets | 8. | Cheap oil |
| 4. | US-China tensions | 9. | Europe after Merkel |
| 5. | Global data control | 10. | Latin America |
The report warns that the pandemic and its widespread impact will not go away once vaccination is extended. Uneven recoveries, variation in access to vaccines, and short-term stimulus plans will increase debt levels, leave workers displaced, and feed opposition to incumbent leaders.
For the US, this will increase the polarization that fueled support for Donald Trump. For emerging economies, the debt crisis could cause financial problems, according to the report.
Some concerns are more likely to be overestimated “red herring” risks, the report adds. These include relations between Biden and “Trump’s traveling companions,” such as Turkish Recep Tayyip Erdogan, Brazilian Jair Bolsonaro, British Boris Johnson, and Israeli Binyamin Netanyahu. The Biden administration will participate in shared interests and leaders will adapt to the new status quo, according to the report.
Fears of a global backlash against big US technology and an Iran-US confrontation are also seen as lower risks.