For the past 75 years, the global system underpinning the spread of democracy and markets to much of the world has survived quite a lot: the simmering tension of the Cold War, the havoc brought on by the collapse of gold-dollar monetary convertibility, devastating debt and financial crises, and the rise of Islamic extremist movements. As it bounced from crisis to crisis, it seemed to become more entrenched, chugging away quietly in the background as most of the world’s citizens took it for granted. The move towards liberal internationalism became the norm, with deviations from it unfortunate exceptions. Today, however, we may be on the cusp of something different, with potentially perilous consequences. As the two past global hegemons – the United Kingdom and United States – fall victim to a resurgent wave of populism criss-crossing the world, nothing short of the liberal, pro-market international order is at stake.
Europe and America will bear some of the most immediate consequences. While the discordant Parliamentary gridlock of the last month and the ensuing Brexit accord – on any terms – may serve to cast the European Union in a more positive light, the more lasting legacy will be to embolden anti-Brussels movements on the continent, from Jobbik in Hungary to the Alternative for Deutschland in Germany. In fact, Italian interior minister Matteo Salvini is fresh off bringing together many of them into a populist alliance ahead of European elections next month. Across the pond, President Trump’s adept use of haranguing social media diatribes and promotion of nativist firebrands to some of the country’s highest positions threatens the integrity and independence of American democratic institutions. At the same time, it is successfully creating a “post-truth” rightwing constituency and propelling a Left increasingly flirting with identity politics and social democratic projects, further entrenching record-levels of political polarization.
Yet it is also Europe and America that must take the onus to prevent this coming Great Unraveling.
Europe must do its part to make the lessons of Brexit felt by all would be copycat movements, from “Grexit” to “Italexit” and beyond. To counter populism means, at first, convincing populists that the best way to fight for their national interests are within the corridors of power in Brussels, Strasbourg, and Frankfurt. That entails being more tolerant of broad-based parliamentary blocs whose modus operandi is bashing pan-European agencies for domestic political gain. It might also require bending the rules a bit to give member states temporary control of certain policy areas currently in the EU’s hands, coupled with targeted, high-profile development funds in Euroskeptic regions. The longer game will be selling the idea of Europe to a bloc dealing with citizen anger at persistently high unemployment, low growth, rising debt-to-GDP levels, and concerns about migration.
In Washington, the anti-establishment frenzy can be countered by Democrats and moderate Republicans, who often have more in common with each other than the simplified, zero-sum message of, say, the House Freedom Caucus or the Bolton-Pompeo brand of foreign policy. But doing so may mean rethinking some of America’s institutions themselves. Its campaign finance free-for-all allows “special interest groups” – which polls frequently show are one of the few concepts that both progressives and conservatives profess to hate – to unduly influence elections and the dangerous ideological echo chambers that they perpetuate. Moreover, the end of pork barrel appropriations in 2011, which used to effectively “grease the wheels of Congress”, has resulted in countless budget impasses that fuel the nation’s increasingly tribal politics.
And on the international front, Europe and America must band together, both to keep intact institutions vital to bolstering global economic growth, like the WTO and IMF, as well as to counter what Larry Diamond has labeled an ongoing “democratic recession”. Indeed, it is in their respective interests to do so. In an increasingly economically-intertwined world, it is becoming more and more difficult to separate one country’s economic interests from that of others. As Washington’s current trade spat with Beijing shows, when one country – particularly one at the heart of many global supply chains – hiccups, this has often severe consequences on European and American levels of capital investment, consumption, employment, and even agricultural production. And as Western citizens increasingly dally with undemocratic ideas, this opens to door to Russia and China, who are all too happy to more directly interfere in elections, engage in cybertheft, create regional financial institutions to wean the world off the dollar and euro, and step into the global diplomatic void in a far more illiberal way.
As part of this, Brussels and Washington need to separate the reality of the global international order from Western citizens’ fear-laden conception of globalism. The former is, essentially, an extension of John Locke’s idea of individual rights to the global arena, where instead of autonomous individuals cooperating in the state of nature, you have autonomous countries who find that it is in their clear benefit to lay down some rules of the game in order to reap mutual benefits in a positive-sum game. The latter is a fear that “unelected bureaucrats” (a common term of disparagement among many anti-globalization advocates) in the mold of Thomas Hobbes will grow stronger and stronger at the expense of national sovereignty.
Too often, the political and economic gains humanity has made because of the relatively democratic rise of market-based capitalism is masked by growing levels of economic inequality, urban-rural divides, and a media-fueled sense that “the other” – whoever he or she may be – is doing better than us. That “traditional values” are being trampled on by an amorphous premonition that we are losing not only our identity, but our freedom as well, all at the hands of a powerful elite. Nevermind that much of this perception is down to the success and rising expectations of the post-WWII global international order itself, since in spite of the fact that high poverty levels stubbornly persist in pockets of the world, most who live in industrialized countries now have enough security and leisure time to ponder these questions and formulate nationalist responses. Alas, Francis Fukuyama may not have been far off when he proclaimed the victory of the liberal, capitalist order in the late 1980s (i.e. the “end of history”), and his recent work on the international importance of re-fostering human dignity and respect is spot on. The identity-laden “politics of resentment” enveloping the world is in no small part due to the participatory, economic, and technological gains the global order has presided over, but the irony is that it is now ballooning out of control and threatening judicial independence, the media, impartial bureaucracies, markets, and other pillars of these very institutions.
Nonetheless, the future does not have to look this grim. Europe and America have a golden opportunity to prevent this unraveling. Doing so does not mean ignoring citizens’ often-valid political grievances or cultural preferences, nor does it mean avoiding the reality that markets have clear winners and losers that challenge the heart of our ideas of fairness and meritocracy. Instead, it means coordinating policy responses and reducing economic barriers, while at the same time realizing that issues around national identity are complex but natural, and that citizens should be given outlets to help them cope with the rapid pace of cultural, economic, and technological change. Integration while allowing a degree of policy cushion, and not simply isolationist retreat, is the best response. The question is whether Brussels, London, Washington, and other global players are ready to take on this mantle. Indeed, the fate of liberalism depends on it.
Written by Roberto Pucciano for H Edition Magazine