Kiss globalization Goodbye
The era of partial or total dependency is over. The most important lesson the world has learned, and that nations will begin to put into practice, is that self-sufficiency is always paramount.
The deserted streets will fill up again and we will leave our burrows illuminated by the light of the screens blinking with relief. But the world will be different from how we imagined it in what we thought were normal times.
This is not a temporary break in an equilibrium that would otherwise be stable. The crisis we are going through is a turning point in history.
The era of globalization has come to an end. An economic system based on global production and long supply chains is being transformed into a less interconnected one. A more fragmented world is being born, which, in a way, can be more resilient.
The once-formidable British state is rapidly reinventing itself on a scale never seen before. The government, acting with draconian emergency powers authorized by Parliament, has thrown economic orthodoxy overboard.
Battered by years of stupid austerity — like the Armed Forces, the police, prisons, firefighters, caretakers, and cleaners — the National Health Service is on the ropes, but, thanks to the noble dedication of its workers, the virus will be kept at bay.
Our political system may or many not will survive intact. Governments around the world are struggling in the narrow alley between suppressing the virus and crushing the economy. Many will stumble and fall.
In the vision that progressive intellectuals cling to, the future is a prettier version of the recent past. That certainly helps them preserve a certain appearance of sanity.
This vision also undermines what is currently our most vital attribute: the ability to adapt and create different ways of life. The task ahead is to build economies and societies that are more durable, independent and less reliant on global market anarchy.
This does not mean moving to small-scale localism. The human population is too large for local self-sufficiency to be viable, and most of humanity is unwilling to return to the small, closed communities of a more distant past.
But the kind of hyper globalization seen over the last decades is not going to return. The virus has exposed fatal weaknesses in the economic system, which had been patched up after the 2008 financial crisis.
Corporatism is bankrupt
Despite all its verbiage on freedom and choice, in practice, corporatism aided by globalism was an experiment in dissolving all traditional sources of social cohesion and political legitimacy and replacing it with the promise of an increase in the material standard of living. Now, this experiment has come to an end.
To end the virus, an economic closure was not essential, but governments and states followed the orders of non-elected officials, despite the fact that they have failed time and again every single opportunity they have had to show their value.
When the economy starts up again, it will be in a world in which governments will act to curb the influence of the global market and the recommendations of international organizations such as the WHO, the UN and the WTO; obsolete creatures whose lives must come to an end.
A situation where such a large part of the world’s most needed medical supplies is produced in China or any other country exclusively, will not be tolerated.
Production in this and other sensitive sectors will be returned to the territories of the States for reasons of national security. The idea that a country like the United Kingdom could gradually eliminate agriculture and depend on food imports will be dismissed as the nonsense it has always been.
The airline sector will contract because people will travel less, and hard borders will become a logical lasting feature of the global landscape. The objective of economic efficiency will no longer be viable for governments.
The question is, what will replace the increase in the material standard of living as the foundation of society? Some people call for a “steady-state economy” which advocates depopulation and a considerable reduction in production and consumption.
The steady-state economic system would be a market economy in which competition would be encouraged. Technological innovation would continue and with it, the art of living would be improved.
In many ways, the idea is attractive. Growth would be determined by each country and no world authority would exist to impose any particular interest.
Contrary to what the progressive mantra -that is megaphoned by so-called global leaders- states, global problems do not always have global solutions. Geopolitical divisions exclude anything that may bear any resemblance to a world government, and if it existed, current states would compete to control it.
The belief that the crisis can be resolved with an unprecedented outbreak of international cooperation is magical thinking in its purest form.
In this new world, economic expansion would be negotiated in a bilateral or trilateral fashion.
If we end up accepting the limits of growth, it will be because governments make protecting their citizens their most important objective. States that fail to look for the benefit of their people will ultimately cease to exist.
The pandemic has suddenly accelerated geopolitical change. The uncontrolled spread of the virus in Iran, added to the collapse of oil prices, could destabilize its theocratic regime.
With the fall in its revenues, Saudi Arabia is also in danger. Without a doubt, there will be some who are happy to say goodbye to both. However, there is no guarantee that a collapse in the Gulf will bring with it anything other than a long period of chaos.
Despite years of talking about diversification, the region’s regimes remain hostages to oil, and even if prices recover somewhat, the economic impact of the global shutdown will be devastating.
By contrast, East Asia will surely continue to advance. So far, the countries that have given the most effective response to the epidemic have been Taiwan, South Korea and Singapore.
China’s position is more complex. Given its history of cover-ups and opaque statistics, it is difficult to assess its performance during the pandemic. Of course, the country is not a model that any democracy can or should emulate.
As the new Nightingale hospital of the National Health Service demonstrates, authoritarian regimes are not the only ones capable of building hospitals in two weeks and no one knows what the total human cost of Chinese closure has been.
Still, the Xi Jinping regime appears to have benefited from the pandemic; the virus has provided a number of arguments to expand state surveillance and to introduce even tighter political control.
Instead of squandering the crisis, the President is using it to increase the influence of his country. China is putting itself in the right place of the European Union with its help to struggling national governments, such as Italy.
However, not all China does is good. Many of the masks and test kits supplied by China have been found to be defective, but this does not appear to have taken a toll on the Beijing propaganda campaign.
The European Union’s response to the crisis has revealed its essential weaknesses. Few ideas are so despised by higher minds as sovereignty. In practice, this means the ability to execute a comprehensive, coordinated and flexible emergency plan like those applied by the United Kingdom and other countries.
The measures that have already been adopted exceed any of those taken during World War II, and in their most important aspects are also the opposite of what was done then, when the British population was the subject of an unprecedented mobilization and unemployment fell dramatically.
Today, apart from those providing essential services, British workers have been demobilized. If the situation continues for many months, the closure will require even greater socialization of the economy.
It is doubtful whether the burned-out neoliberal structures of the European Union are capable of doing anything similar. The hitherto sacrosanct rules have been contravened by the European Central Bank’s bond purchase program and the relaxation of the limits on state aid to industry.
But the resistance of northern European countries, such as Germany and the Netherlands, to sharing the tax burden may prevent the rescue of Italy, a country too big to be crushed like Greece, but possibly also too expensive to be saved. As Italian Prime Minister Giuseppe Conte said in March, “if Europe does not rise to this unprecedented challenge, the entire European structure loses its raison d’être for citizenship.
Serbian President Aleksandar Vucic has been more direct and realistic: “European solidarity does not exist… That was a fairy tale. The only country that can help us in this difficult situation is the People’s Republic of China. To the others, thanks for nothing ”.
The main flaw of the European Union is that it is unable to fulfil the protective functions of a State. The decomposition of the eurozone has been predicted so many times that it may seem unthinkable. However, with the tensions it currently faces, the disintegration of European institutions is not an exaggeration.
Free movement has already been suspended. The recent blackmail by Turkish President Erdogan, threatening the EU with allowing migrants to cross the borders of his country and the outcome in the Syrian province of Idlib could lead to the flight to Europe of hundreds of thousands, even millions, of refugees.
It is hard to imagine what “social distancing” can mean in the huge, crowded and unhealthy refugee camps. Another emigration crisis added to the pressure on a dysfunctional euro could have dire results.
If the European Union survives, it may look like the Holy Roman Empire in its final years, a ghost that subsists for generations while power is wielded elsewhere.
Preemptory decisions are already being made by the national states. Since the political centre is no longer a leading force, and with much of the left clinging to the failed European project, many governments will be dominated by the ideological Right.
Russia will exercise increasing influence over the European Union. In the battle with the Saudis that acted as the trigger for the collapse of the oil price in March 2020, Putin had the best shot. While for the Saudis the threshold of fiscal profitability – the price necessary to pay for public services and maintain the solvency of the State – is about $80 per barrel, for Russia it may be less than half.
At the same time, Putin is consolidating his country’s position as an energy power. The Nord Stream submarine gas pipelines that cross the Baltic ensure the reliable supply of natural gas to Europe, while making it dependent on Russia and allowing it to use energy as a political weapon. Like China, Russia has entered the scene to replace the faltering European Union by sending doctors and equipment to Italy.
In the United States, Donald Trump clearly believes that protections must be in place as long as the economy is able to stay afloat. A stock market crash similar to that of 1929 and worse unemployment levels than those of the 1930s would pose an existential threat to his presidency.
On the other hand, considering the country’s decentralized government system, a disastrously abused healthcare system, the tens of millions of people without health insurance, a huge prison population with a large number of elderly and sick people, and cities where a significant number of homeless people live and already suffer from a widespread opioid epidemic, restricting closure could mean that the virus is spreading uncontrollably with devastating effects. Trump is not alone in taking this risk. So far, Sweden has not imposed anything similar to mandatory confinement.
Unlike the British program, the $2 trillion in Trump’s stimulus plan is, for the most part, another bailout to companies, which are responsible for creating and maintaining unemployment low. In the U.S., more and more Americans approve of the way Trump has managed the epidemic. What will happen if the president comes out of this catastrophe with the support of a majority of Americans?
Even before the virus arrived, America’s position in the world had been changing irreversibly. Trump is the main reason why hyper globalization and the old world order implanted after the end of World War II, has been collapsing since 2016. The virus has broken an imaginary balance and has accelerated a disintegration process that has been going on for years.
As globalization has progressed, so has the risk of spreading infectious diseases. The so-called Spanish flu of 1918-1920 became a global pandemic in a world without mass air transport, so imagine what a more deadly virus could do today in a globalized world.
From his point of view, as from that of others, the occasional catastrophic outbreaks of infectious diseases remained sudden and unpredictable breaks in the norm that, in essence, escaped any historical explanation. Many subsequent studies have reached similar conclusions.
However, the idea persists that pandemics are transient incidents rather than an integral part of the story. Behind it is the belief that humans are no longer part of the natural world and can create an autonomous ecosystem, separate from the rest of the biosphere.
Covid-19 tells us that this is not the case. We can only defend ourselves against this plague using science. Massive antibody tests, not vaccines, will be decisive, but if we want to be less vulnerable in the future, we will have to make permanent changes in our way of life.
The texture of everyday life has already changed. Everywhere there is a feeling of fragility. Furthermore, the feeling of instability does not only affect society. The same is true of the position of human beings in the world. Viral images show human absence in different ways.
Covid-19 does not bring the end of the world by any means. What is usually called an apocalypse is the normal course of history. Many come out of it with lasting trauma, but the human-animal is too strong and versatile for these disorders to break it.
Life goes on, although different from how it was before. Those who describe the present moment have not noticed how human beings adapt to extreme situations.
Technology will help us adapt to our current extreme conditions. Physical mobility can be reduced by moving many of our activities into cyberspace.
Offices, colleges, universities, doctor’s offices and other workplaces may change forever. Virtual communities organized during the epidemic have made it possible for people to get to know each other better than ever.
But even this new reality may not be a flawless one. Cyberspace depends on infrastructure that can be damaged or destroyed by war or a natural disaster. The Internet helps us avoid the isolation that has accompanied epidemics in the past, but it does not allow human beings to escape from our mortal flesh or to avoid the irony of progress.
What will happen to progress?
The virus teaches us not only that progress is reversible – a fact that even progressives seem to have understood – but that it can undermine its own foundations.
To cite the most obvious example, globalization has brought great strides. Thanks to it, millions of people have been lifted out of poverty. Now, this achievement is in jeopardy. Deglobalization in progress is the daughter of globalization.
At the same time as the prospect of a constantly increasing standard of living fades, other sources of authority and legitimacy re-emerge. Whether liberal or socialist, progressive thinking detests national identity with passionate intensity.
History is full of episodes that show how it can be misused. However, the nation-state is reaffirming itself as the most powerful force to drive action on a large scale. Facing the virus requires a collective effort.
This is where the Protective State comes into play. The British state has always been Hobbesian. Peace and a strong government have been its fundamental priorities. At the same time, this Hobbesian state has relied on consent, especially in times of national emergency. Protection against danger has been imposed on freedom from government interference.
How much of their freedom will people have returned to them, after the peak of the pandemic, is an unanswered question. It does not seem that the obligatory solidarity of socialism is very much to their liking, but perhaps they will accept a biovigilance regime for the sake of better protection of their health.
Although the size of the state may not increase in all cases, its influence will be pervasive and, according to old-world criteria, more intrusive. The post-liberal government will be the norm in the near future.
Only if we recognize the weaknesses of liberal societies can we preserve their most essential values. These include, along with legitimacy, individual freedom, which, in addition to being valuable in itself, constitutes a necessary check on the government.
For almost anyone, security and belonging are just as important, and sometimes more so. Liberalism, in effect, has been a systematic denial of this fact.
An advantage of quarantine is that it can be used to renew ideas. Cleaning our minds and thinking about how to live in a “new world” is our task now. For those of us not serving on the front lines, this should suffice for as long as confinement lasts.