By: Col Dan McGuire
Image courtesy of Shutterstock (Photo contributor andriano.cz)
Executive Summary
This paper adopts the perspective of Great Power Competition as a historical trend arising from the critical interplays of security, trade, and economic ideologies. After WWII, the United States (U.S.) instituted a Grand Strategy of the liberal world order to reverse this imperialistic trend on a global scale. Complementary, the U.S. influenced the security policies of member states with the intent of isolating its main competitor, the Soviet Union. The strategy worked brilliantly but was never adapted after the fall of the Soviet Union, as no other great power existed. However, the People’s Republic of China later exploited the world order for capitalist gain to become a regional hegemony with the capability and desire to rewrite the rulesets of the world order. Therefore, the time is now for the U.S. to rewrite the rulesets of their own Grand Strategy while we still can. Since the liberal world order’s path to globalization fueled the rise of the PRC, methodical deglobalization will blunt their rise and incite a decline. This time, the influence will not just be on a member state’s security policy, but their policy on trade and industry. This calculated approach will require the U.S. to shift focus from being a global consumer to regaining a foothold as a global provider. To accomplish this new Grand Strategy, the U.S. should employ an International Relations (IR) optic called Neoclassical Industrial Realism to increase its Defense Industrial Base and create regional sustainment frameworks within an International Defense Industrial Base. Overall, the assessment of U.S. Grand Strategy demonstrates the urgent necessity to rewrite the existing rulesets to create a Grand Strategic posture of Neoclassical Industrial Realism which simultaneously controls PRC and Russian decline while rebuilding U.S. and allied industrial capacity.
Introduction
The current world of geopolitics and international relations centers upon various news and discussion about Great Power Competition (GPC). Namely, that GPC between the United States (U.S.) and the People’s Republic of China (PRC) and the U.S. and Russia has the potential to escalate into conflict. While the specifics of this current version of GPC contain nuances, the idea that there is a GPC is not new at all. The main reason GPC recurs is due to the foundational reasons GPC occurs in the first place, and these reasons are rarely if ever, resolved. This paper contends that a great framework to explain GPC is the security dilemma, which posits the means by which states increase their security may incite another state to feel threatened and thereby increase their own level of security.[i] However, the deeper complexity is when states are unable to differentiate offensive posture from defensive posture as each increases security to protect the people, land, and resources which enable their survival[ii] and to trade or procure the resources they lack.
U.S. Airmen assigned to the 705th Munitions Squadron conduct convoy operations during exercise Prairie Vigilance 25-1 at Minot Air Force Base, North Dakota, April 14, 2025. (U.S. Air Force photo by Senior Airman Kyle Wilson)
This paper offers a topically relevant examination upon the need for nation-states to grow in development and industrialization while maintaining the level of security required. As Major General David Sanford stated in his recent ER article titled “Battling Sustainment: Contested Logistics and the War in Europe,” “it is vital for Joint Logistics planners to gain and leverage a proper understanding of the modern global economy and future contested logistics environments.”[iii] The first section details the historical trajectory of GPC and offers a specific perspective on how trade and security helped incite the World Wars (WWs). A current assessment of U.S. Grand Strategy follows to explain that the liberal world order created post WWII still holds today. The next section shifts to Russia and the PRC to walk through their trajectory in two parts: from post-WWII to 1990 and from 1990 until now. The section on Russia and the PRC presents why the U.S. Grand Strategy worked from post-WWII to 1990, why it has not worked from 1990 until now, and why we must change it. The paper concludes by introducing Neoclassical Industrial Realism as the Grand Strategic posture necessary for the United States to deter great power conflict or mitigate losses and provide for U.S. success in the case of conflict.
Historical Trajectories of Great Power
Competition Through an Industrial Lens
How does the historical trajectory of GPC unfold through an industrial lens? The short answer is not overnight, but also not surprisingly. Most importantly, GPC is not new because the fundamental reasons nations enter into GPC are not new. This section traces a simplistic trajectory of how trade, security, and the use of global oceans helped incite WWI. The linkage between the security dilemma and trade is not a full explanation for the WWs by any means, but the foundational perspective upon which to understand the rest of the paper.
Women at work in the Douglas Aircraft Factory, Long Beach, California. (Photo courtesy of the National Archives)
For most of history, countries fought over the land, resources, and personnel that fueled survival. This constant conflict occurred through invasion and occupation for two main reasons. First, most nations lacked the technology, resources, easily navigable rivers, and abundant arable land for self-sufficiency.[iv] Second, supplementing via trade proved lengthy and costly as it occurred mostly over roads, concentrated by non-perishable items at a marked price.[v] However, when deep water navigation was born, and cross-continental trade made easier and faster, the prices dropped significantly, and profits surged.
Nations with more favorable geographies to this trend, coastal or island nations without great fear of land invasion, were increasingly able to transform that profit into a robust naval power. This development created a gap between a set of great powers who had a strong and capable navy and those who did not. Instead of engaging in great power conflict between each other, they colonized other nations to create their personalized means of trade and travel routes, which procured their required resources. These powers then produced cities and ports that processed goods and commodities into products for domestic and international consumption. Two proficient examples of this are Great Britain and France, who colonized multiple areas of African and Asian coastline and avoided the islands.[vi]
Eventually, industrial revolutions followed, transforming the availability and speed of raw materials, energy, and transportation to such a low cost that even inland nations could also begin mass production.[vii] Although multiple nations were now able to mass produce their preferred product and earn capital,[viii] the means to manage said capital varied. As a result, the economically bent ideologies of capitalism, socialism, and fascism emerged.[ix] All combined, conflicts within a region were inevitable as nations balanced the processes used to fund industrialization, urbanization, and human development while differing on an underlying economic ideology that frames the intersection of these processes. As one example, a nation like fascist Germany used its navigable riverways to generate products and capital to become a regional power. However, it did not possess territorial claims to the global oceans as its rivals to North and West, Great Britain and France. The security dilemma ensued, and regional competition became a WWI conflict. An ineffective Versailles Treaty followed[x] and with mass economical fallout yet without a change in the aforementioned system, WWII followed as an extension of WWI.[xi] While certainly not the only reason for WWI and WWII, this explanation helps clarify what occurred post-WWII and why Naval power, global commons, trade, and security were vital.
Africa, administrative divisions, February 1960. (Photo sourced from Library of Congress Online Catalog 1,711,798)
Assessment of Current U.S. Grand Strategy
The Grand Strategy of the U.S. has remained largely consistent since its inception in 1945 as the creator and overall leader of the liberal world order. As World War II drew close, the U.S. held the strongest position and organized a summit with 44 other nations in Bretton Woods, New Hampshire, to unveil their plans for a new global landscape.[xii] The majority of nations expected the U.S. to seek selective control of strategically-selected land, territory, and resources. However, instead of following the historical model of imperialism or colonialism referenced above, the U.S. did something completely different. The U.S. effectively created the liberal international order, bolstering globalization and establishing an international system that benefits all member nations and with only one catch. We will patrol the global oceans and invite nations to engage in global trade, urbanize, and develop without fear of imperial privateering as long as their security policy is anti-Russian. Nearly every nation with power projection, whether a good or bad actor, decided to sign on.[xiii]
U.N. Monetary Conference (Photo by Associated Press Photographer Abe Fox)
Furthermore, the U.S. took on even more risk by becoming the global consumer so these nations could build back their wealth within this system.[xiv] The nations that grew wealth from this system industrialized, urbanized, and saw their overall quality of life increase.[xv] This strategy emphasizes the importance of a continuing advantage rather than merely focusing on tactical victories.[xvi] In this sense, the U.S. formulated this Grand Strategy to ensure the sustainment of global security by blunting the imperialist instincts that led to the two WWs. As long as the U.S. continues to monitor the global commons and act as a massive consumer, as it has done since post-WWII, the liberal world order can continually persist. However, this is the decade this adjusts, and there are two major competitors with a revisionist Grand Strategy that the U.S. must deter.
Insights of Russian and Chinese Grand Strategy
Russia and China from post-WWII to 1990
Overall, this U.S. post-WWII Grand Strategy saw much success in gamesmanship and economic statecraft,[xvii] notably with the disintegration of the Soviet Union. At the end of WWII, the U.S. found itself misaligned with its former ally, Russia, mainly ideologically, and determining how to respond required deep insight into the nation-state’s history, identity, and subsequent actions.[xviii] Overall, the U.S. assessed communism as the complication of the same greater disease: a long history of internal and external conflict due to geography, economics, and identity, resulting in supreme levels of insecurity, which incite the need for power and control of their people.[xix]
This assessment helped frame the impetus to drive the connectedness of globalization. As globalization took off, the Soviet Union’s lack of interconnection led to its isolation and gradual decline. With this strategy, the U.S. avoided a protracted, conventional conflict against Russia’s forces and instead created the means for every nation between them and Russia to develop and advance. However, after the Soviet Union fell, an adaptation of how to utilize the international world order going forward was never fully realized.[xx]
Russian Grand Strategy AI illustration. (Provided by author)
Meanwhile, the PRC did not enter into globalization until the 1980s. Post WWII, the PRC reverted to civil war, this time between the nationalists and the Chinese Communist Party (CCP). The CCP pushed back against extraterritoriality and sought reform from within. The disastrous great leap forward and cultural revolution under Mao Zedong led to mass starvation and political chaos.[xxi] This devastation lasted until the 1980s when a new leader, Deng Xiaoping, moved the PRC’s economy from command-based to open market.[xxii] As the U.S. gained influence within East Asia, the U.S. sought the protection of its material interests, coupled with only a modest effort to sustain the effectiveness and prestige of China.[xxiii] While co-interests existed, they were worth diplomatic support only and not the risk of war with a major power.[xxiv] As Chinese nationalism grew and the Sino-American relationship evolved, there were increased intellectual and cultural contacts[xxv] on how and when the PRC would reform[xxvi]. However, reform never came, and the PRC increasingly leveraged the scale of their labor force[xxvii] towards the massive outpouring of cheap manufacturing supported through subsidies. As the relationship furthered, China sought to reduce foreign influence and regain control over its industry.
Summary of this time period: Post WWII, the U.S. employed a grand strategy to create an international world order that guaranteed global security by isolating Russia. This strategy worked as intended and caused the collapse of Russia by the 1990s. As Russia collapsed, the time was then to do another rewrite of the liberal world order’s rulesets to maintain global security further. However, there was no other great power rival to the U.S. to focus their Grand Strategy upon, so the strategy remained stagnant. In the 1980s, the PRC began to exploit the liberal world order while maintaining its communist ideology, and it started to rise as a regional hegemon.
Russia and the PRC from the 1990s until Present Day
Russia’s Grand Strategy from the 1990s until the present day is a dual focus on imposing their socialist, geopolitical will and economic pressure within the region through the exploitation of their natural resources in the form of dependence. They desire to rebuild the Russia of old and regain the protections, influence, and global recognition an expanse of their borders will bring. However, Russia has not been as successful as the PRC in building resilient interconnections to the global economy. Russia’s more rigid command economy has demonstrated an inability to advance within a liberal world-order framework that values flexibility and responsiveness. Their strategy instead relies upon their historical desire to advance their reach through deception and intelligence breaches. Overall, instead of fostering collective military and industrial relationships within the region, Russia’s stagnant economics and depopulation have led to desperate territorial grabs, as seen by the war in Ukraine.
Global economy AI illustration. (Provided by author)
The PRC witnessed the collapse of the Soviet Union and seemingly learned from its mistakes. Over the past 35 years, the People’s Republic of China (PRC) exploited the liberal world order and exposed the vulnerabilities of the U.S. not adapting the rules. Through the application of mass labor supported by gross subsidies, the PRC exported cheap manufacturing at great volume and speed. Their Gross Domestic Product (GDP) rose exponentially, and they industrialized and urbanized at the fastest rates the world has ever seen. Moreover, the PRC accomplished all without being a democracy, maintaining its authoritarian regime,[xxviii] and sustaining relationships with the Soviet Union, North Korea, and Iran. Ultimately, they have become the only nation capable of rewriting the global world order.
However, when analyzing PRC’s economic future, there is no rational model that suggests a decrease in demographics or a decrease in global consumption would be anything other than devastating. While PRC can reasonably maintain the subsidies in the future, its population cannot sustain the level of manufacturing required[xxix]. Immigration is not a reasonable option for PRC to supplement their workforce as they remain inherently discriminatory towards human beings outside of Han ethnicity, and there’s no mass influx of people seeking to live in PRC’s autocratic regime. Overall, the projected decline in demographics worldwide hinders the consumption-driven model PRC has exploited. Despite this, projections from the PRC state that they will spike global consumption by 2025,[xxx] match the U.S. in conventional capabilities by 2027,[xxxi] and reach global hegemony by 2050.[xxxii] Due to this, now is the time for the U.S. to finally rewrite the rulesets.
Connecting to the Present
U.S. Grand Strategy AI illustration. (Provided by author)
Post WWII, the U.S. created a world order which anyone could join, but there must be talks and discussions regarding their security policy and it being anti-Russian. This strategy blunted Russia’s ability to maintain its post-WWII power and they fell. However, the rulesets were never adjusted after Russia’s fall and thereby provided the means for the PRC to rise in power. Therefore, now is the time for the U.S. to adjust the rulesets while we are still in the primary position to do so.
While anyone can still be a part of this post WWII world order, a strategic alliance with the U.S. may come at the cost of further discussions. If security was the primary topic of the day post WWII, the primary topic of the day now is industry and trade. More specifically, to maintain a favorable relationship with the U.S., a partner state’s industry and trade may need to become anti-PRC. The U.S. must take away the greatest source of the PRC’s ability to gain power yet do so in a manner that provides the U.S. with continual advantage. Therefore, the new Grand Strategic posture the United States must now pursue is rewriting the rules of the liberal world order to maintain continuing advantage in a post-globalization world. By receding globalization on our terms and rulesets, we can ensure that any potential partners understand the new requirements and incentives to align with us, effectively rewriting the rules of engagement in this evolving global landscape. Moving forward, the U.S. must reduce globalization on its terms through an optic titled neoclassical industrial realism.
Coming next in this series is Part II: What is Neo-Classical Industrial Realism and how it will Frame the New World Order.
The views expressed in this article are those of the author and do not necessarily reflect the official policy or position of the Air Force, the Department of Defense, or the US Government.
About the Author
Col Dan McGuire is a recent graduate of Air War College’s Grand Strategy Seminar. The Grand Strategy Seminar is a year-long concentration specifically focused upon Great Power Competition, with the majority of content centered upon the People’s Republic of China and Russia. Col McGuire has a Master’s in Transportation and Mobility Management from the Advanced School of Air Mobility, and a Masters of Strategic Foresight and Doctorate of Strategic Leadership (concentration of Strategic Foresight) from Regent University. His next assignment is as the Defense Logistics Agency Liaison to U.S. Transportation Command.
Works Cited
[i] Jervis, Robert. “Cooperation under the Security Dilemma.” World Politics 30, no. 2 (January 1978): 169-214.
[ii] Ibid.
[iii] Sanford, David. Battling Sustainment: Contested Logistics and the War in Europe. Exceptional Release: Spring 2025.
[iv] Ziehan, Peter. The Accidental Superpower: Ten Years On. New York: Harper Business, 2023.
[v] Braw, Elizabeth. Goodbye Globalization: Risk and Opportunity in a Time of Crisis. New York: Encounter Books, 2021.
[vi] Copeland, Dale C. A World Safe for Commerce: American Foreign Policy from the Revolution to the Rise of China. Princeton: Princeton University Press, 2024.
[vii] Rifkin, Jeremy. The Third Industrial Revolution: How Lateral Power Is Transforming Energy, the Economy, and the World. New York: St. Martin’s Griffin, 2011.
[viii] Smith, Adam. Wealth of Nations. Ware, England: Wordsworth Editions, 2012.
[ix] Ambrose, Stephen and Brinkley, Douglas, Rise to Globalism: American Foreign Policy since 1938. New Baskerville: Penguin Books, 1997.
[x] Kissinger, Henry. “The New Face of Diplomacy: Wilson and the Treaty of Versailles.” In Diplomacy. New York: Simon & Schuster, 1994, 218-245.
[xi] Bell, P. M. H. The Origins of the Second World War in Europe. 3rd ed. New York: Routledge, 2007.
[xii] Benn, Steil. The Battle of Bretton Woods: John Maynard Keynes, Harry Dexter White, and the Making of a New World Order. Princeton: Princeton University Press, 2013.
[xiii] Ikenberry, G. John. Liberal Leviathan: The Origins, Crisis, and Transformation of the American World Order. Princeton: Princeton University Press, 2012.
[xiv] Ziehan, Peter. The End of the World is Just the Beginning. New York: Harper Business, 2022.
[xv] Friedman, George. The Storm Before the Calm: America’s Discord, the Coming Crisis of the 2020s, and the Triumph Beyond. New York: Doubleday, 2020.
[xvi] Dolman, Everett. Pure Strategy: Power and Principle in the Space and Information Age. New York: Routledge, 2005.
[xvii] Brands, Hal. The Twilight Struggle: What the Cold War Teaches us About Great-Power Rivalry Today. New Haven: Yale University Press, 2022.
[xviii] NSC-68. “A Report to the National Security Council: United States Objectives and Programs for National Security.” April 14, 1950. Pages 4-10, 13-16, 21-24, 34-36, and 44-59.
[xix] X (George Kennan). “The Sources of Soviet Conduct.” Foreign Affairs 25, no. 4 (July 1947): 566–82.
[xx] Chollet, Derek, and James Goldgeier. America Between the Wars: The Misunderstood Years Between the Fall of the Berlin Wall and the Start of the War on Terror. New York: Public Affairs, 2008.
[xxi] Joseph, William A., ed. Politics in China: An Introduction. 4th ed. Oxford: Oxford University Press, 2024.
[xxii] Vogel, Ezra F. Deng Xiaoping and the Transformation of China. Cambridge, MA: Belknap Press of Harvard University Press, 2011.
[xxiii] Cohen, Warren I. America’s Response to PRC. Columbia University Press. 2019.
[xxiv] Ibid: 59.
[xxv] Ibid: 63.
[xxvi] Thurston, Ann. Engaging PRC: Fifty Years of Sino-American Relations. New York, NY: Columbia University Press, 2021.
[xxvii] Dickson, Bruce. The Party and The People. Princeton University Press. 2021: 88, 115.
[xxviii] Kroenig, Matthew. The Return of Great Power Rivalry: Democracy Versus Autocracy from the Ancient World to the U.S. and China. Oxford: Oxford University Press, 2020.
[xxix] Ziehan. The End of the World is just the Beginning. 2022.
[xxx] Suttmeier, Richard P., and Andrew L. Yaw. “Understanding China’s Made in 2025 Strategy.” Center for Strategic and International Studies, 2018.
[xxxi] Department of Defense. Military and Security Developments Involving the People’s Republic of China: 2024. Washington D.C., 2024.
[xxxii] Center for Strategic and International Studies. China 2049: The Path to a Superpower. Washington, DC: CSIS, 2019.