Power--Hiding The Veil Of The World Economy

International political economy is the study of a series of social, political and economic rules governed by values, which affect the system of production, exchange and distribution in the world arena. There are too many rules in the world economy. These rules decrease the transaction cost and uncertainties, so the wealth of countries would increase. Meanwhile, these rules are the results of the competitions among the great powers .We define the power of deciding rules as the "structural power", while structural power do need a substantial power as it's base. We define this substantial power as the "connected power". How can we define the two powers, where do they come from, and how would they decide the rules in the world economy, these three questions are the contents of this article. Power is a conception discussed for many years both in China and in West. Generally, we define the power is the relation of one's action making others'actions change. The conception of power became the core conception as it was introduced in politics. At present, the conception used comprehensive is defined by Marx·Web, who is a German politics scholar and sociologist .He defined the power is the any opportunity to carry out the wills on whatever conditions. In international political economy, scholars would rather interpret power from the relation between politics and economy. Susan·Strange discusses the relation between country and market from the different arrangements among the four basic values of mankind, wealth, security, just and freedom. Power is the key factor deciding these arrangements. First, she uses the conception of power by realist theory and she name it as the "connected power", which means A use the power to force B to do the things that he would not like to. Second, she puts forward another conception of power with inspiration, she defines it as the "structural power", that means a decision—making power. In this article I use the two kinds of power and assure there are two special features of structural power. One, has one country have this power, he could change other countries'choices of sphere, and affect them indirectly at the same time. Two, the structural power is decentralized, it composed of the structure of security, the structure of production, the structure of finance and the structure of knowledge. These four structures are different and connected. Structural power influence the specific relations by these four structures. Structural power and connected power have the same feature—relativity. When does one country have the two powers? Where or not every country has the two powers. We should explore the sources of the two powers. Connected power is the power to B to do the things that he would not like to. This article consults the analyzes of the factors of state's power by Hans Morgenthau, and divides the source of connected power in nine factors: geography, natural resources, the efficiency of industry, military, population, the character of nation, the morale of people, the quality of diplomacy, and the quality of government. Structural power means a decision—making power. There are four sources of it, the structure of security, the structure of production, the structure of finance and the structure of knowledge. Has one country haven structural power, it would use it's comparative advantage to influence the structure of security, production system, finance system and the communication of knowledge. It's no doubt that if one country has the two powers, he would use them to defend, to expand and to show it in the world. While, there is no authoritative distribution system in the world economy, so uncertainties exist universally and information is asymmetry. In order to decrease the transaction cost and increase respective wealth, countries would prefer to harmonize their benefits or to set rules observed universally. We can find out that the rules are the reflection of the structural power. That does not mean the connected power is discarded. If there were no connected power, there would haven't haven the structural power. Connected power is the necessary not the sufficient condition of the connected power, and obscured in the world economy. GATT(General Agreement on Tariffs and Trade), WTO(World Trade Organization )and the Bretton Woods System are the most suitable cases for the comprehension of the structural power. GATT and WTO are the carrier of the world trade post the World War II. The prior is rule of the world trade during the Cold War; the latter is the reflection of the new pattern of the world trade after the Cold War. The two systems are guided by the U.S.A .In nature, GATT is the result of U.S.A suing for hegemony with U.S.S.R and also the result of American structural power in the West Bloc. With the rise of Japan and EC, U.S.A was relative declined, so the operation of GATT was not stable than ever. Before Ronald Reagan came to the power, U.S.A has become a service—oriented country with high—technology, but only the traditional goods trade was included in GATT, so it was not suitable for the benefits of U.S.A. U.S.A used it's structural power to call a new round of talk—Uruguay Round Talk, at last WTO came into existence. WTO is the works of U.S.A in nature, it rebuilds the rules catering for the needs of America, and involves the most trade businesses in the world arena. GATT and WTO are the trade system in the world. Besides of GATT and WTO, U.S.A sets up the regional trade systems to realize it's rights. Maybe, NAFTA (North American Free Trade Agreement)is the most suitable example for interpreting that. NAFTA are signed by U.S.A, Canada and Mexico. Since America brings forward the rules and dominates the process of negotiations, NAFTA is also the result of American structural power and an important part of the global system of America. There are three important roles of it: One is improving the economic growth of America. Two is a crucial part of the "strategy of trade in all ways"to antagonize EU and APEC. Three is the base of structuring the America Free Trade Agreement. Bretton Woods System is the rule of international finance governed by American structural power in the world arena. The key of Bretton Woods System is that $35 is equal to an ounce gold, the exchange rate of other countries sticks to U.S Dollar. If other countries'governments or central banks...