In the previous post on Global Trends 2030: Alternative Worlds we looked at the dark Stalled Engines scenario, the most plausible worst-case scenario presented in the National Intelligence Council’s (NIC) comprehensive analysis. This post will examine the “bookend” to this scenario, Fusion, which represents the most-plausible best-case scenario. The NIC’s companion report to Global Trends 2030 entitled “Le Menu” provides a possible scenario leading to a description of this second alternative world:

“The specter of a spreading conflict in South Asia prompts the U.S. and China to intervene. Washington and Beijing find other issues to collaborate on. Emerging economies grow faster than advanced economies, but GDP growth in advanced economies also accelerates. Technological innovation is critical to the world staying ahead of the rising resource constraints that result from the rapid boost in prosperity.”

Fusion is the most-plausible best-case scenario presented in the GT2030 study and in a sentence is one in which “all boats substantially rise.” However, this all-too-brief description only scratches the surface of this “happy” scenario.

In the National Intelligence Council’s Fusion world, economic growth resumes as the initial collaboration on security is widened to include intellectual property and innovation to deal with resource issues and climate change. China, bolstered by the increasing role it is playing in the international system, begins a process of political reform. With the growing collaboration among major powers, global multilateral institutions are reformed and made more inclusive. In other words, political and economic reforms move forward hand in hand.

Fusion is the other bookend to Stalled Engines and portrays a radically different world than the first scenario. The National Intelligence Council sees Fusion as the most-plausible best-case scenario. This is a world in which the specter of a spreading conflict in South Asia triggers efforts by the United States and China to intervene and impose a cease-fire. Armed with this success, China and the United States find other issues to collaborate on, leading to a sea change in their bilateral relations, as well as to broader worldwide cooperation on global challenges. This scenario would only be possible through strong political leadership that overrules cautious domestic constituencies and forges stronger international partnerships. As a result, trust between societies and civilizations would increase in this scenario.

In the National Intelligence Council’s Fusion world, economic growth resumes as the initial collaboration on security is widened to include intellectual property and innovation to deal with resource issues and climate change. China, bolstered by the increasing role it is playing in the international system, begins a process of political reform. With the growing collaboration among major powers, global multilateral institutions are reformed and made more inclusive. In other words, political and economic reforms move forward hand in hand.

In this Fusion scenario, all boats rise, and rise substantially. Emerging economies continue to grow faster than advanced economies, but GDP growth in advanced economies also accelerates. The National Intelligence Council’s analysis leads to the conclusion that if the Fusion scenario plays out fully the global economy nearly doubles by 2030 to $132 trillion that year. The American Dream returns, with per capita incomes rising $10,000 in 10 years. Chinese per capita incomes also rapidly increase, ensuring that China avoids the middle-income trap. In Europe, the eurozone crisis proves to be the catalyst for deep political and economic restructuring.

For many analysts, given the once-a-decade power change that has just occurred in China, it is literally too early to tell if China will move in a direction that is supportive of the Fusion scenario. But this bears close watching, especially how China reconciles its current tensions with its neighbors over competing claims in the South China Sea, East China Sea, and elsewhere in the region, to say nothing of how (and if) China attempts to “rein in” North Korea.

In the Fusion scenario, in addition to political leadership in states, the role of nonstate actors is also key. Technological innovation – rooted in expanded exchanges and joint efforts at the university and research lab level – is critical to the world staying ahead of the rising resource constraints that would result from the rapid boost in prosperity.

Without putting too fine a point on it, this happy scenario is one that not only governments hope for but virtually all people hope plays out. And over the past half-century there have been several inflection points where the Fusion scenario looked likely indeed. While it seems like eons ago, it wasn’t that long ago that people were talking about the “peace dividend” that seemed like it would occur as the Cold War ended. Sadly, that has not been the case.

That is not to say that the Fusion scenario is not possible, for the National Intelligence Council’s analysis is solid that it is possible. As the world appears to most of us in 2013, this scenario does not seem to be one that is on a fast track to reality, but a great deal can happen between now and 2030.

It is clear from NIC’s analysis, to say nothing of years of posts by a wide array of expert commentators here on Defense Media Network’s website, that while there are numerous “moving parts” that would have to come together in a serendipitous way for the Fusion scenario to become reality, if there is one factor that dominates this multi-variable equation, it is China. Here is some of what the NIC says will need to happen with China for the Fusion scenario to become reality:

“A liberal China increases the possibilities for regional security in Asia … Greater democratization takes hold first, with a more liberal regime in China … China emerges stronger with its soft power enhanced and begins to move toward democracy. It assumes greater global and regional roles.”

For many analysts, given the once-a-decade power change that has just occurred in China, it is literally too early to tell if China will move in a direction that is supportive of the Fusion scenario. But this bears close watching, especially how China reconciles its current tensions with its neighbors over competing claims in the South China Sea, East China Sea, and elsewhere in the region, to say nothing of how (and if) China attempts to “rein in” North Korea.

As suggested by the Global Trends 2030: Alternative Worlds Executive Summary, the Fusion scenario is one of cooperation and technological innovation. As I suggested in my initial post on alternative worlds:

“A defense industry executive who sees the Fusion scenario developing would likely anticipate less demand for high-end platforms, systems, sensors and weapons that might be needed for interstate conflict but might shift R&D dollars toward those platforms, systems, sensors and weapons that help major powers deal with what are sometimes thought of as second-tier threats: illegal immigration, fisheries encroachment, homeland security and like threats. And clearly, there is no ‘one size fits all’ solution for individual countries or even regions, but each solution must be tailored to a particular nation’s needs – including what it considers an acceptable level of risk.”

In the next two posts we’ll move away from the “bookend” scenarios and on to two other potential scenarios presented in Global Trends 2030: Alternative Worlds, Gini out of the Bottle and Nonstate World. After that, we will continue with hedging strategies that industry can adopt to best position to accommodate whatever scenario – or blend of scenarios – transpires circa 2030.

Continue to Part 13: Global Trends 2030: Gini Out of the Bottle