he prevailing situation was a general peace caused by the balance of power among several nation-states and nation-empires: Britain, France, Germany, Russia and Austria-Hungary.
It was a peace characterized by competition: jockeying for economic position, territorial sovereignty and imperialistic exploitation of colonial regions and Middle Eastern/Asian spheres-of-influence. To the extent that capitalism was emerging as the dominant economic mode, on the shoulders of mercantilism and traditional feudalism, the international economy was based upon a competitive model that Adam Smith would have recognized. The key to the 19th century was that this was the first fully global world economy. The nation-state was the established political unit, and every industrialized nation-state thought in terms of global implications. Kaiser Wilhelm II was prepared to prick at war with France and Britain in order to gain the concession of East African colonies for Germany. Britain ruled the waves for two reasons: military power and the economic necessity of servicing its far-flung colonial business interests. In his 1905 play, Major Barbara, George Bernard Shaw made the point that capitalism needed a war somewhere in order for the industrial machine to keep rolling. He oversimplified the situation: the 19th century's multipolar balance-of-power required a military-industrial coordination of efforts - it needed general peace and international order to thrive.
It is just this sort of multipolar situation that I imagine will be the status quo twenty years from now. The players will be different - although not entirely. The conception of "power" will also be somewhat altered from the 19th century version. What will not change is this: there will not be a return to the bipolar balance-of-power of the Cold War era, and there will be a general peace created by a multipolar balance of international powers who will work together to enforce ...