Why the dream of economic liberalism turned into a nightmare
GRAVE NEW WORLD: THE END OF GLOBALIZATION, THE RETURN OF HISTORY by Stephen D King (Yale, £20)
THE fall of the Soviet Empire between 1989 and 1991 marked the high tide of western hubris, characterised by the belief that as economic liberalism spread, so would our versions of democracy.
The invasion of Iraq in 2003 and the financial meltdown after 2008 punctured this delusion, as did the prodigious growth rates notched up by the authoritarian capitalists of China. It did not help either that western politics (and parts of the mainstream media) were hit by corruption scandals involving expenses or phone-hacking.
The West got cold feet about whether or not globalisation was such an unalloyed good, as people noted huge domestic economic inequalities, as in the case of the 0.1 per cent of plutocrats and the rest in the US, or between nation states such as Germany and Greece, Italy and Spain in the EU. To make matters worse, the cultural identity of the US and Europe seemed to be assailed by what everyone realises is just the advance guard of migrants fleeing failed states, drought and war.
One result was that many of those hurt by globalisation sought sanctuary and security in a protectionist version of the nation state. Raucous populists of both Left and Right pandered to this anxiety. As celebrities — be they barflies, grandpas or tycoons — they conformed nicely with the internal dynamics of both the old and new media. They could always provide the live bust-ups that TV producers were seeking, while their soundbites were perfectly attuned to those echo chambers for the likeminded such as Twitter. The British voted for Brexit and Trump became US President.
The array of international institutions that the US created in 1944-45 have lost their potency, while the EU is frozen between being an assemblage of nation states and a federal union with a common currency that itself has exacerbated structural inequalities.
Meanwhile, China has established a range of rival associations, including the Asian Infrastructure Investment Bank, the Regional Comprehensive Economic Partnership and the Shanghai Co-operation Organisation, while launching the One Belt, One Road initiative, which in scale exceeds the Marshall Plan.
Stephen D King charts the rise and fall of globalisation in this elegantly written and fluent book which effortlessly combines economics, history, politics and technologies. His darkest thoughts envisage a future that resembles that of George Orwell’s Nineteen Eighty Four, in which the world consists of three blocs any two of which are always at war with the third. A spoof speech by Republican President (Ivanka) Trump in 2044 shows where we might be in a couple of decades.
Are things as bleak as King suggests? He is persuasive on how technology reinforces prejudices and how, through automation and 3-D printing, manufacturing and services could be re-shored. Nor will we require winter aubergines from Kenya or Peru if we follow Japan’s example (and the hash growers of Brixton) with hydroponic factories. He is also convincing on how a rise in incomes in Africa
(whose population may have risen by 40 per cent by 2100) may result in even more migrants from, for example, a Nigeria whose population will be 752 million and not 182 million.
But it is also striking that in 2017 populist challengers have been defeated in Austria, the Netherlands, Spain and France in recent elections, and that Chancellor Merkel will be a shoo-in this September. Were the political systems of the “Anglosphere” not so terminally dysfunctional, politicians might be able to mitigate the problems which King describes so well, including the creeping superfluity of entire swathes of the clerical middle class.