The first great era of globalisation from roughly 1840 through to 1914 took place inside a framework that we can now view as the last hurrah of empire. The logic of empire extends back to the invention of agriculture – a technology that fundamentally demands access to fertile land, rainfall and sunshine. This meant all successful societies needed to expand their territory in order to survive, hence 10,000 years of conquest, colonisation, slavery and exploitation.
The nature of empire is to create silos of control over territory, trade and politics – each silo largely self-contained and treating all others as a competitors and potential prey. Industrialisation during the 1800’s had a paradoxical effect on this – it both empowered and intensified this process for a period, until the system collapsed in the two Great Wars of the 20th century. It also spun off three competing economic strategies – fascism, communism and capitalism. Fascism springs from an essentially authoritarian impulse that like the feudalism which preceded it – centralises power in the state; and it was the first to fall. Communism springs from the idea of the collective, the notion of community taking precedence over all – but based primarily in a highly materialistic, power based model of society – it failed to establish a form of society that met the social needs of it’s populations and failed in it’s own turn. Capitalism rooted in the idea of the sovereignty of the individual has proven the most durable, but it’s neo-liberal forms which imposed market models onto the legitimate domains of both the state and community will also prove fatal in time.
The second great attempt at globalisation post-WW2 arose almost by accident. The US possessed by the need to contain the Soviets in Europe (it could not allow them access to the Atlantic) created a new form of alliance at Bretton Woods. It was unquestionably a hegemony – but not one based on the need to control territory, but to control the politics. Essentially the US bribed much of the world to create an alliance against the Soviets, the deal was that the Americans would provide the security and framework to enable global trade – as long as you were politically on their side against communism. And as flawed and narrow as this motivation was it was wildly successful. It not only contained and eventually destroyed the Soviets – it also led to the greatest period of human development ever. The relative peace and prosperity that most of us have taken for granted all our adult lives – is really just a brief blip in history consequent on this relatively flimsy structure.
But having won the Cold War the US never had much interest in what might come next. We forget that of all the great nations, the US economy is the least involved in global trade. Outside of North America the rest of the world could sink beneath the waves tomorrow and it would make a few paras on pg.3 of their major media. As a result the US has elected five Presidents in a row who have promised the least involvement in the outside world. Clinton, Bush, Obama, Trump and now Biden have all followed the same basic imperative – pulling back from their overseas involvement where it no longer makes sense for them to do so. At this point in time there are fewer US troops stationed overseas than anytime since 1915 and it will keep reducing. The pullout from Afghanistan, as bungled as it was, is only one of many steps most accompanied by far less publicity. By the end of this year there will be zero US troops in the ME. NATO serves up nice lunches at it’s conferences, but it makes no sense for the US to keep paying to defend Germany against Russia. Not only is Germany now the 4th largest economy in the world, the modern Russians really only want to trade with them – not invade. Europe and the ME are on their own and historically these are two of the most turbulent regions on the planet.
Thus the political conditions that enabled this second great phase of globalisation are coming to an end – with consequences no-one can foresee at present. Moreover the economic conditions that underpinned it are also at the same time coming to an end. At the end of WW2 the troops went home, created the great suburbs and had lots of children – the Boomers. This generation created a huge consumption demand everywhere, which in turn enabled export led growth for any nation capable of participating. As this generation matured it also invested creating massive capital markets which powered infrastructure and industry across the planet. Every day for the two decades post 2000 – some 250,000 households got connected to an electricity grid, lifting them out of poverty and transforming their lives. In 2016 fully half the human race became middle class by local standards, and by 2020 barely 15% of people lived in absolute poverty. We should not lightly dismiss this extraordinary achievement.
Yet with relatively few exceptions (and NZ is one of them) in most countries the Boomers didn’t have so many children. Japan was the first to hit this demographic boundary in the 90’s – suddenly transitioning to a post-growth economy. What happened to Japan is now happening to economies all over the world in this decade. By 2030 most of the current export led economies will look more like Japan – post growth. Thus bringing to an end the economic conditions that have prevailed since WW2 – and the end of trade based globalisation as we’ve known it in our lifetimes.
It will also likely bring to an end capitalism’s run – it too will exhaust the potential of it’s current form. This new post-growth world will need a new ‘ism. If we apply the principles of evolution, it will conserve elements of what came before it – it’s reasonable to think features such as the state, nations, trade, markets and money will persist – but equally any new economic form must transform them into something that better serves our needs. So while the second great phase of globalisation has peaked and is now running on fumes – the left should be thinking about what might come next. After a period of turmoil – humans will globalise again – and we should be thinking about how this might evolve into a form that meets not only humanities material needs – but our authentic social and spiritual ones as well.
Moderation Note: I will monitor this thread and shift to OM any of the usual ‘anti-US’ derails some people here habitually indulge in. They’re boring, out of date and not the topic of this post.