prescriptive versus descriptive

globalisation dyspepsia

This afternoon, 5-6.30 eastern, we will discuss ‘Life in the Attaché Lane’ with President of the National Bureau of Asian Research, Roy Kamphausen, and Arminda Kamphausen, Director of Global Initiatives & Sustainability at the University of Connecticut School of Business. They will discuss what one does representing the U.S. overseas in this capacity and how it affects families, our relations with host nations, and the like. If we run out of things to say, both Mindy and Roy continue their China involvement so I suppose we can press them into China analysis just for the afternoon….:) If you need the link, shot me a note or look at the ActionsCreateConsequences newsletters over the past four days. Pull up a chair to join us!

Two new people pledged financial support to this newsletter over the weekend which I appreciate sincerely. I also thank those who sent comments on my last column about my father. The only thing I wished I had said, in conjunction with his patriotism, is how bursting with pride my father would have been that I was at the National War College, a far distance from his home town in the Ozarks.

Over the jammed weekend, an article caught my eye because it so encapsulates the trauma we are undergoing in our society. It also embodies something my father would have said, shaking his head that it even had to be said: it’s all relative. The theme of Patricia Cohen’s, ‘Why It Seems Everything We knew About the Global Economy is no Longer True’¹ not only captures today’s mood but it subtly reminds us of the title of this substack: Actions Create Consequences.

Cohen discusses, in a single piece, the failure of expectations plaguing so much of the post-Cold War world—failure of laissez-faire economics and the overall hidden hand to balance a system once overloaded, feara of seemingly unstoppable trends, disappointment when institutions chose another perspective other than our own, the frustration with other states’ actions en lieu of playing as we thought agreed upon, and the frank anxiety permeating so much of the globe.

The one thing she does not mention adequately is the fact that the world tends to go through support an distrust of these same phenomena periodically. In other words, part of the problem is that we no longer know much about what has happened in the past so it appears so terrifyingly new now.

Yes, the digital revolution, the advent of this AI thing, the instantaneous move of capital around the globe, and the destruction of the global climate are definitely new. They each are also seriously threatening, much less in tandem or sequence.

But doubts about free trade go back almost two hundred years. In the Nineteenth Century, Liberalism advocated for free trade while it was Conservatives who tried sealing off this nation from foreign intervention and investment. The seeds of free trade resulted from shifting market strategies in the late 1800s when imperial states sought to broaden their access, including through trade with other countries and colonies. (Indeed, I still hear people explain that China will never go to war over Taiwan because everyone in China understands the damage a war would do to their economy. Obviously these folks skipped that history lesson that Germany and Britain were rather intertwined economically prior to the summer of 1914.)

Trying to preclude another World War I experience led leaders to opt for more effective ways and means of statecraft to include creating global organisations. First the League of Nations in the 1920s and ‘30s, then the United Nations after 1945, and more recent global agreements were thought more effective at binding states together to assure peace.

Turns out states still pursue their interests rather than some unified global ones. Today, the Left and the Right in America mock agreements ranging from the World Trade Organisation to the World Health Organisation to the Climate convention in Copenhagen because states are putting their interests above those of others rather than abiding by accords they signed. We do it often when it comes to World Trade Organisation dispute resolution, for example. In short, distrust of everyone else’s motives abound. When we whine about China altering the liberal international order, yes, they definitely seek to exploit it for their own interests but our record is far from stellar as anyone in the old ‘third World’ would point out.

I heard someone comment on the morning news that Republicans today want to ban the very ideas that Ronald Reagan, the patron saint of the party a mere thirty-five years ago, embraced aggressively in the face of the closed mentality so characteristic of the Soviet bloc. In Reagan’s day, Democrats and their union supporters feared the power of global forces, supporting freer trade through the North American Free Trade Agreement only after the Gipper’s retirement. The anti-global crescendo, however, was fewer than five years after NAFTA’s razor thin passage and the election which brought the Gingrich Republicans to power. The left worried about globalism’s effects on more than money and trade. Remember Seattle in 1999?

It’s relatively hard to find anyone in the U.S. political class today supporting laissez-faire economics and genuine bipartisan constraints on government spending to curb profligacy. In the immediate hubris after the Cold War, we were the ones who took those policies to Latin America, to Africa, to Southeast Asia, and elsewhere a generation ago but eschewed them at home. The U.S. supported IMF ‘economic orthodoxy’ is today associated with the 1997-98 financial collapse in Indonesia that ended thirty plus year Suharto regime. Mahattir Mohammed made Malaysia a pariah by refusing such western advice but region remembers Washington advocating harsher solutions as Asians faced real financial pain. Argentina’s similar collapse four years later never really ended, either. We looked like we did not care and now we look like we don’t know how to curb spending either.

Anti-immigrant feelings? Oh, puleeze. That is hardly new, either. Argentina, Canada, and arguably Australia welcomed people to their countries with relatively open arms but even as the United States was exploding through the Industrialisation of the 1800s, the Irish, the Germans, the Jews, the Italians, the Slavs, the Chinese, and the African-Americans who we brought here as slaves were told to go home as they were unwelcome.

I can only speak with a limited authority about the behaviour of other countries but I certainly saw anti-immigrant proclamations as a graduate student in the United Kingdom forty-five years ago. We had to prove we had financial resources for our time in country and show we were not planning to stay as Britain did not want Yanks, Arabs, Caribbeans, or South Asians. I realise Germany welcomed the Turks in the early 1960s but most European populations seemed weary of immigrants of any nation a generation after that.

Politicians around the world rally supporters who want simple solutions to extremely convoluted problems. The interwoven nature of our world means North Americans have blueberries in the refrigerator for New Year’s Eve but rue asking if there is a serious cost to this or to the relatively inexpensive high tech products we buy so readily. Put differently, what were the trade offs that allowed those blueberries to make their way from Valparaíso to Portland? We (me included) so rarely take any time to ponder the layer upon layer of changes that globalisation brought us because it is now so firmly at heart of our lives. Food, energy, finance, information, military technology, violence, religion, ideology, etc. etc. etc. etc. is linked in so many ways that the reports last week of the Unabomber’s 1995 manifesto demanding a simpler world seemed downright quaint (if deadly). That boat left the dock years ago yet we now see there were associated costs.

Those costs don’t mean we should not have any forms of globalisation. Even the most vocal critics seem to recognise that advances in health and some technologies are priceless. The problem is that Cohen’s piece, along our own experiences, illustrates that how you view any of this depends on how it affects you. Actions create consequences favouring some and disfavouring many as well. In the end, the pain or the gain completely depends on one’s vantage point. Sometimes that pain or gain shifts rapidly in unexpected ways with no guarantees for the future. And that is the part so frustrating. We increasingly seek some stabilisation as the past three decades have been pretty topsy turvy. Yet is this completely new?

This weariness and angst is the basis for the rise of political movements around the world guaranteeing they can solve the problem if fully empowered (thus unfettered). That for my money is the terrifying part. Any and every political movement decrying compromise is dangerous as human behaviour by its very existence is compromise-based. It has to be or the option is, as we see tragically way too often, that one in two people will die because things—far too many things—become zero sum: a single winner and single loser

If we knew a bit more history, if we understood that institutions can rise and fall, if we had a bit more faith in those around us, we could probably get through this period more easily. Some of the challenges, as discussed week before last on climate, appear epic and immediate while others less so. Without valuing compromise, each of us prioritises without much attention to anyone else which is not allowing us to find many solutions. But, grumbling about life’s unfairness is a descriptive solution rather than a prescriptive one for solutions. Put me in the latter camp. I look for solutions. Anyone interested in working on them?FIN

1. Patricia Cohen, ‘Why It Seems Everything We Knew About the Global Economy is No Longer True’, NewYorkTimes.com, 18 June 2023, retrieved at https://www.nytimes.com/2023/06/18/business/economy/global-economy-us-china.html?action=click&module=Well&pgtype=Homepage&section=Business