What a mess, but what else is new?
Readers have scolded me gently for too much optimism over the last year, wondering why I refuse to see the world economy is in dire trouble and the international order is coming apart at the seams.
So for Christmas reading I have retreated to The World of Yesterday, the poignant account of Europe’s civilizational suicide by the Austrian writer Stefan Zweig — the top-selling author of the inter- war years. From there it is a natural progression to Zweig’s biography of Erasmus, who had seen his own tolerant Latin civilization smothered by fanatics four centuries earlier.
What is i nteresting in Zweig’s account is that even during the slaughter of the First World War, Europe still had a moral conscience. All sides still bridled at any accusation they were violating humanitarian principles.
Two decades later, even that had disappeared. Zweig lived to see Hitler take power and burn his books in 1933. He saw what remained of Austria extinguished in 1938, and his friends sent to concentration camps. As a Jewish refugee in England, he slipped from stateless alien to enemy alien. He committed suicide with his wife in February 1942 in Brazil.
Erasmus was also the bestselling author of his day. More than one million copies of his works had been printed by 1515. But after lighting the fire of evangelical reform, he watched in horror as the ideologues, headed by Martin Luther, took over. They split Christian Europe into armed camps, rather than yield an inch on points of doctrine. The killing did not end until the Treaty of Westphalia in 1648.
So, perspective is in order as we look at the world in late 2015. The fateful rupture between the U. S. and China that many feared has not happened. Washington has so far managed the rise of a rival superpower benignly.
China has been admitted into the governing elite of the Bretton Woods financial system with U.S. backing. To wide consternation, Barack Obama and Xi Jinping steered through a sweeping climate-change accord in Paris, the template for a new G2 condominium. This is not to deny that the Pacific Rim remains the world’s most dangerous f ault- l i ne. The South China Sea is on a hair trigger. The U.S. navy faces the unenviable task of defending the global commons of open shipping without crossing a strategic line.
Russia’s Vladimir Putin has gained little by overthrowing Europe’s post- war order. He has kept Crimea, but his attempt to foster revolt in the Donbass through proxies fizzled long ago, and in the process he has transformed a neutral Ukraine into a hostile rampart of the West. His hopes of dividing the Atlantic alliance came to nothing. Europe has just renewed sanctions. The country is shut out of western capital markets. Unless oil recovers, Russia will have exhausted its reserve fund by 2016 and will face a fiscal crisis by mid-2017.
So why so much political angst in the West? Joschka Fischer, the former German foreign minister, calls it — a little carelessly — the fascism of the affluent. “It is a fear based on the instinctive realization that the ‘ white man’s world’ is in terminal decline,” he said.
Perhaps, but his evidence for the U. S.’s chauvinist lurch is that Donald Trump is scoring well in the polls. Wheth- er Republican voters will really back him is questionable, and U. S. campaigns are prone to wild moments. We forget that Texas billionaire Ross Perot won 19 per cent of the presidential vote in 1992 with a third- party bid on a protectionist platform.
As Washington correspondent in the early 1990s, I covered the Oklahoma bomb-
The one great disorder is the collapse of the old Sykes-Picot dispensation
ing — America’s worst act of homegrown terrorism — and the eruption of state militia movements, mostly blue- col- lar workers from states like Texas or Montana who had fallen through the bottom of the globalized economy and spent their weekends training with assault rifles. This weird revolt spread, then suddenly disappeared as the labour market tightened.
Fischer is closer to the mark on Europe, but there is a glaring omission in his diagnosis: He never mentions monetary union, which has ensnared the eurozone in a seven- year depression. Output has yet to match its earlier peak, worse than during the 1930s.
The eurozone’s deformities have not been corrected. There is still no fiscal union. The crisis will return in the next global downturn. But for now the stimulus of a cheap euro, cheap oil, quantitative easing, and the end of fiscal austerity are combining in a “perfect positive storm.”
The one great disorder is the collapse of the centuryold Sykes- Picot dispensation in the Middle East ( under which the British and French agreed to divide up the Arab provinces of the Ottoman Empire), made more combustible by the Sunni- Shia battle for regional mastery.
It is a humanitarian tragedy, but in geostrategic terms it is a regional problem, a particular struggle within Islam to come to terms with modernity. It is sui generis and of no universal relevance.
Nor should we overestimate the staying power of the Wahhabi caliphate as it tries to hold fixed ground against a world now seriously irritated; and without fixed ground, constant infusions of money, and the allure of rising momentum, the Islamic State of Iraq and the Levant does not add up to much.
Yes, the world is a mess, but it has always been a mess, forever climbing the proverbial wall of political worry even in its halcyon days. So let us drink a new year’s toast with a glass at least half-full.