From Liberal Globalisation to Economic Nationalism?

Contemporary counter movements, universally dubbed as "populist" differ in many respects, but they all agree on a number of significant political and economic issues. First, a condemnation of the economic polices shared until now by the major electoral parties. Second, a criticism that the...

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Datum:	2019
1. Verfasser:	Lane, D.
Format:	Artikel
Sprache:	English
Veröffentlicht:	Iнститут соціології НАН України 2019
Schriftenreihe:	Социология: теория, методы, маркетинг
Schlagworte:	Статьи
Online Zugang:	http://dspace.nbuv.gov.ua/handle/123456789/182322
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Zitieren:	From Liberal Globalisation to Economic Nationalism? / D. Lane // Социология: теория, методы, маркетинг. — 2019. — № 4. — С. 136-141. — англ.

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spelling	irk-123456789-1823222021-12-30T01:26:18Z From Liberal Globalisation to Economic Nationalism? Lane, D. Статьи Contemporary counter movements, universally dubbed as "populist" differ in many respects, but they all agree on a number of significant political and economic issues. First, a condemnation of the economic polices shared until now by the major electoral parties. Second, a criticism that the economic mechanism and political process have led to social polarisation. Third, a contention that electoral democracy has delivered an oligarchic bloc of irresponsible elites who have utilised neo-liberalism to legitimate their own interests. 2019 Article From Liberal Globalisation to Economic Nationalism? / D. Lane // Социология: теория, методы, маркетинг. — 2019. — № 4. — С. 136-141. — англ. 1563-4426 http://dspace.nbuv.gov.ua/handle/123456789/182322 171 : 172 en Социология: теория, методы, маркетинг Iнститут соціології НАН України
institution	Digital Library of Periodicals of National Academy of Sciences of Ukraine
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language	English
topic	Статьи Статьи
spellingShingle	Статьи Статьи Lane, D. From Liberal Globalisation to Economic Nationalism? Социология: теория, методы, маркетинг
description	Contemporary counter movements, universally dubbed as "populist" differ in many respects, but they all agree on a number of significant political and economic issues. First, a condemnation of the economic polices shared until now by the major electoral parties. Second, a criticism that the economic mechanism and political process have led to social polarisation. Third, a contention that electoral democracy has delivered an oligarchic bloc of irresponsible elites who have utilised neo-liberalism to legitimate their own interests.
format	Article
author	Lane, D.
author_facet	Lane, D.
author_sort	Lane, D.
title	From Liberal Globalisation to Economic Nationalism?
title_short	From Liberal Globalisation to Economic Nationalism?
title_full	From Liberal Globalisation to Economic Nationalism?
title_fullStr	From Liberal Globalisation to Economic Nationalism?
title_full_unstemmed	From Liberal Globalisation to Economic Nationalism?
title_sort	from liberal globalisation to economic nationalism?
publisher	Iнститут соціології НАН України
publishDate	2019
topic_facet	Статьи
url	http://dspace.nbuv.gov.ua/handle/123456789/182322
citation_txt	From Liberal Globalisation to Economic Nationalism? / D. Lane // Социология: теория, методы, маркетинг. — 2019. — № 4. — С. 136-141. — англ.
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fulltext	136 Со ци о ло гия: те о рия, ме то ды, мар ке тинг, 2019, 4 David Lane From Liberal Globalisation to Economic Nationalism? UDC 171 : 172 DAVID LANE, Emeritus Reader in Sociology, Emeritus Fellow of Emmanuel College, University of Cambridge, United Kingdom From Liberal Globalisation to Economic Nationalism?1 The elec tion of Don ald Trump, the UK’s exit from the Eu ro pean Un ion, and strong chal lenges to the cur rent rul ing elites by pop u list par ties in France, Greece, Hol land, Hun gary and Po land con front the neo-lib eral rul ing elites. These so cial move ments, uni ver sally dubbed as ‘pop u list’, of fer an elec toral choice but we re main puz zled as to what pol i cies they are likely to im ple ment. There are par al lels with post-First World War Eu rope when John Maynard Keynes de clared: ‘The dec a dent in ter na tional but in di vid u al is tic cap i tal ism, in the hands of which we found our selves af ter the war, is not a suc cess. It is not in - tel li gent.... and it does n’t de liver the goods. In short, we dis like it, and we are be - gin ning to de spise it. But when we won der what to put in its place, we are ex - tremely per plexed’ (Na tional Self-Suf fi ciency 1933). While con tem po rary coun ter move ments dif fer in many re spects, they all agree on a num ber of sig nif i cant po lit i cal and eco nomic is sues. First, a con dem na - tion of the eco nomic po lices shared un til now by the ma jor elec toral par ties. Sec - ond, a crit i cism that the eco nomic mech a nism and po lit i cal pro cess have led to so - cial polar is ation. Third, a con ten tion that elec toral de moc racy has de liv ered an oli gar chic bloc of ir re spon si ble elites who have uti lised neo-lib er al ism to le gi t i - mate their own in ter ests. Scepticism of the Global Economic Order Such de fi cien cies lead to two po lit i cal chal lenges: First, scep ti cism about the ben e fits of a global or der. The way of think ing which dom i nates West ern states -  D.Lane, 2019 1 The article is published on the website: https://research.sociology.cam.ac.uk/news/ liberal-globalisation-economic-nationalism. Reprinted with permission of the author. men is global neo-lib er al ism. Global neo-lib er al ism in volves the free move ment be tween coun tries of la bour, cap i tal, goods and ser vices. It is the mar ket which should de ter mine the al lo ca tion, com bi na tion and out put of goods and ser vices. The global mar ket should en sure the ef fec tive use of re sources, chan nel ling cap i - tal and la bour into their most ef fi cient uses and prof it able sources. How ever, the out comes of globalised mar kets do not re solve many in com pat - i bil i ties and con se quently they drive crit i cal anti-es tab lish ment move ments. In - vest ment does not pro mote so cial de vel op ment in places where it is most needed. As Keynes pointed out, the mar ket does not achieve the op ti mum em ploy ment of la bour. Though much global pov erty has de creased, an in creas ing num ber of stud ies, rang ing from econ o mist Thomas Piketty to the IMF’s Chris tine Lagarde, con sider that in equal ity has in creased to such a de gree that it is slow ing eco nomic growth. The gap be tween rich and poor in creases in the de vel oped coun tries. Don ald Trump is a con spic u ous leader who has de plored the so cial and po lit i - cal de fi cien cies of de vel op ments in the United States where there are 7.5 mil lion peo ple re corded as ac tively seek ing work, wide spread ur ban blight and high rates of in ter per sonal crime. The level of pov erty can be es ti mated from the fact that over 43 mil lion Amer i cans re ceived food vouch ers un der the Sup ple men tal Nu - tri tional As sis tance Programme. Trump here de scribes one of the rich est coun tries in the world. Of course, not all these de fi cien cies can be at trib uted to ‘globalisation’, but clearly mar ket mech a nisms have not led to a de sir able eco nomic equi lib rium. The op er a tion of the mar ket has led to re cur ring eco nomic fi nan cial in sta bil ity and, even in the rich states, to per sis tent and in sti tu tional forms of pov erty. Pub lic opin ion re flects such dis en chant ment. In 2017, in a study of the 28 mem ber states of the Eu ro pean Un ion, poll sters found that 86 per cent of re spon - dents con sid ered that ‘in come in equal ity in [our] coun try’ was ei ther ‘very se ri - ous’ or ‘some what se ri ous’. (Pro ject 28. 1000 re spon dents in each EU coun try, data col lected 10 April to 31 May 2017. Avail able at: http://project28.eu/for - eign-af fairs-2017). When asked ‘would you say al to gether [that] globalisation, the rise of the global econ omy, is rather good or rather bad to your coun try?’ In fif teen (UK, Spain, Por tu gal, Croatia, Slovakia, Slovenia, Aus tria, It aly, Hun - gary, Bel gium, Czech Re pub lic, Cy prus, France, Lat via and Greece) out of twenty eight coun tries less than half of the pop u la tion rated the in flu ence of the global econ omy as ‘rather good’. Over all 79 per cent dis agreed with the prop o si - tion that ‘com pa nies should move their pro duc tion to where they can find the cheap est la bour force, even if it causes job losses in your coun try’. State Management and Coordination The sec ond chal lenge of the pop u list move ments is that the eco nomic mech a - nism should shift from global mar ket co or di na tion to state man age ment. The con ven tional ar gu ment is that the un re stricted move ment of cap i tal, la bour, goods and ser vices will be re solved on the ba sis of the laws of ‘com par a tive ad van - tage’. If coun tries pro duce what they can do best and then ex change with oth ers, the op ti mum level of pro duc tion will be achieved. La bour and cap i tal will move to where they receive the best returns. Со ци о ло гия: те о рия, ме то ды, мар ке тинг, 2019, 4 137 From Liberal Globalisation to Economic Nationalism? But the laws of com par a tive ad van tage re in force the ex ist ing dis tri bu tion of re sources rather than any ‘nat u ral’ di vi sion be tween dif fer ent coun tries or ar eas. It will not au to mat i cally lead to in vest ment and train ing which un der de vel oped or de clin ing re gions re quire to give rise to new forms of pro duc tion. Out-mi gra - tion, ‘get ting what you de serve from the world’ is the neo-lib eral so lu tion. This how ever has cu mu la tive ef fects — it strength ens the strong eco nomic ar eas and weak ens the poor ones. Mos cow and Lon don be come en riched; and Ivanovo and Ventspils des ti tute. Glob ally, poor un em ployed peo ple mi grate from Af rica to find work, even to de clin ing ar eas of the Eu ro pean Un ion such as Greece — thus exacerbating the downward spiral of de-development. What then is the al ter na tive? If mar ket co or di na tion has been shown to lead to booms and slumps, en rich ment and pov erty, some form of ad min is tra tive co or - di na tion is one al ter na tive. Work ing within the ex ist ing global neo-lib eral frame - work will not solve the prob lem. More over, as there are no dem o cratic in sti tu - tional forms which can pro vide the nec es sary co or di na tion on a global scale, there re main stat ist forms of man age ment. This is be cause the state is the only in sti tu - tion that has the le git i macy and some times (not al ways) the eco nomic power to carry out systematic development with a long term perspective. Economic Nationalism At the heart of these po lit i cal de vel op ments is eco nomic na tion al ism which is a doc trine based on pre dis po si tions and pol i cies which pri or i tize the main te - nance and de vel op ment of the do mes tic (na tional) econ omy. An un der ly ing as - sump tion of eco nomic na tion al ism is that the peo ple form ing a na tion en closed within the geo graph ical bor ders of a state have a com mon in ter est which tran - scends class or other so cial di vi sions within that state and takes pre ce dence over link ages be tween do mes tic ac tors and for eign ones. The cru cial com po nent of eco nomic na tion al ism is that na tional iden ti ties should de ter mine eco nomic out - comes. The ob jec tive of eco nomic nationalism is to protect home industries and cultures from foreigners. There is not one set of pol i cies or in sti tu tions which uniquely de fines ‘eco - nomic na tion al ism’. Eco nomic na tion al ism is a shell in which dif fer ent eco nomic phi los o phies may op er ate. The pro mo tion of the in ter ests of a na tion state can be achieved by dif fer ent po lit i cal forms such as ‘one na tion’ con ser va tism, au to cratic corporatism, so cial ist plan ning, or through a so cial-dem o cratic mixed econ omy. The state pre serves and fur thers the power of do mes tic eco nomic in ter ests. To se - cure its ob jec tives the state uti lises laws, such as tar iffs and tax pol i cies to in flu - ence the di rec tion of trade, and di rect con trol through own er ship of as sets and/or by shap ing the conditions in which private capital and market mechanisms operate. Effects of Globalisation The globalised neo-lib eral econ omy erected many ob sta cles to de ter gov ern - ments from pur su ing pol i cies pro mot ing eco nomic na tion al ism. Coun tries are sub ject to in ter na tional trade trea ties with or gani sa tions such as the WTO and to in ter na tional agree ments with me di a tors such as the IMF. These or gani sa tions 138 Со ци о ло гия: те о рия, ме то ды, мар ке тинг, 2019, 4 David Lane se cure neo-lib eral con di tions which pre clude both state own er ship and pref er - ences for the award of contracts to domestic companies. The power of such global re stric tions has led some writ ers, such as Sam Pryke, to cast doubt on the very pos si bil ity of real is ing eco nomic na tion al ism in the twenty-first cen tury. The equa li sa tion of tar iffs though the WTO fa cil i tated a qual i ta tive change in the geo graph ical mo bil ity of the fac tors of pro duc tion, and the ease of cap i tal mo bil ity has re sulted in a sig nif i cant rise of merg ers and ac qui - si tions. The size and im por tance of trans na tional com pa nies have sig nif i cantly in creased. While trans na tion als have no sin gle home their own er ship is con cen - trated in the hegemonic Western companies — the G7 countries. Na tional laws to pro tect do mes tic work ers (by en forc ing min i mum wages or em ploy ment rights) raise la bour costs. Con se quently, cor po ra tions seek al ter na - tive ‘com pany friendly’ re gimes and trans na tional firms switch pro duc tion from the home coun try to the for eign host. Hence whilst met ro pol i tan com pa nies and their own ers ben e fit from re mit ted prof its and fees, their pre vi ous em ploy ees be - come un em ployed as pro duc tion ceases in the home of the par ent com pany. WTO agree ments do not stip u late wage rates. Free mo bil ity of la bour fa vours cap i tal by keep ing down wage costs. In or der to re tain or at tract com pa nies, na - tional gov ern ments may have to give fi nan cial guar an tees to for eign cor po ra - tions. Iron i cally per haps, in such cases, eco nomic na tion al ism, while pre serv ing the do mes tic economy, concurrently rewards transnational companies and their foreign owners. The Trouble with Economic Nationalism While sig nif i cant sec tions of the elec tor ate in both the USA and West ern Eu rope are cur rently cap ti vated by pop u list pol i cies, it re mains to be seen whether state po lit i cal lead ers will be able to de liver the en vis aged ben e fits of eco nomic na tion al ism. Even US po lit i cal elites led by Don ald Trump are not in - de pend ent ac tors but are or gan i cally linked to busi ness classes. The ad min is tra - tion seeks to pro mote Amer i can busi ness and con cur rently to main tain or even improve Donald Trump’s electoral support. Gov ern ments have the power to im pose pu ni tive tar iffs on im ports and award gen er ous tax in cen tives to ex port ers. But there are lim its to the ad min is - tra tion’s power — po lit i cally, con sti tu tion ally and eco nom i cally. Even if suc cess - ful in re lo cat ing sup plies chains to the home coun tries, the days of ar mies of well-paid skilled and semi-skilled work ers in man u fac tur ing will never re turn. The na ture of man u fac tur ing has changed dra mat i cally. Now pro duc tion is highly mecha nised and the in stal la tion of ro bots and other au to mated pro cesses have sig nif i cantly re duced the num ber of jobs and types of oc cu pa tions. De vel op - ments over the past fifty years have shrunk the in dus trial la bour force: be tween 1975 and 1990, the share of the la bour force of the larg est 500 US man u fac tur ing com pa nies dropped from 17 per cent to un der 10 per cent. For eign ers were also buy ing up Amer i can as sets: in 1977 only 3.5 per cent of man u fac tur ing (by value) was owned by non-Americans, even by 1990 the figure had risen to 11 per cent. Со ци о ло гия: те о рия, ме то ды, мар ке тинг, 2019, 4 139 From Liberal Globalisation to Economic Nationalism? The Changing Production Process The cross bor der na ture of sup ply chains pres ents a ma jor prob lem for eco - nomic na tion al ism, es pe cially for com plex en gi neer ing pro jects such as the con - struc tion of air lin ers and mo tor cars. Mex ico’s ex ports to the USA for ex am ple con tain 40 per cent US con tent. Even sim ple com mod i ties such as seat belts have the fol low ing chain: Mex i can ny lon is ex ported to Can ada for weav ing, and then re turned to Mex ico for cut ting and in stall ing into ve hi cles for ex port (to USA). For the con struc tion of Boe ing’s Dreamliner lit er ally thou sands of parts are im - ported, in volv ing not only aero en gines but also de sign and other high tech ser - vices. Some of these work pro cesses could be brought back to the USA, but not all. Of even more im por tance is the fact that man u fac tur ing in dus try has ex pe ri - enced sig nif i cant changes in the pro duc tion pro cess and in the char ac ter and struc ture of the work force. There has been a mas sive long term shift from in dus - try to ser vices. The USA’s in dus trial work force fell from 31 per cent in 1980 to 17 per cent in 2010. For com par i son, Rus sia has fol lowed the same trend, fall ing from 40 per cent in 1990 to 28 per cent in 2014, giv ing Rus sia still a sub stan tial industrial working class. Econ o mists like Sergei Bodrunov are un doubt edly cor rect to ar gue that ‘bring ing back’ in dus trial pro duc tion to home coun tries would be ben e fi cial and cre ate more jobs. But in dus trial pro duc tion would not rec re ate the con di tions which in the post-war pe riod se cured an af flu ent Amer i can work ing class and in Rus sia a full em ploy ment econ omy. Lev els of wages in man u fac tur ing (for those in work) have de clined in com par i son with ser vices and many of the pre vi ously high pay ing man ual jobs have gone as a consequence of mechanisation. The trans na tional na ture of many cor po ra tions will sig nif i cantly mod ify the pro mo tion of ‘na tional’ in ter est within na tion states. Fa vour ing com pa nies op er - at ing in the USA and pe nal is ing the im ports of for eign firms through tar iffs and tax a tion pol icy will in crease em ploy ment of Amer i cans but con cur rently will also ben e fit foreign firms producing in the USA. One cru cial as sump tion of eco nomic na tion al ism — that there is a com mon in - ter est for all mem bers of a na tion — needs qual i fi ca tion in three ma jor re spects. Firstly, cit i zens in cap i tal ist coun tries do not ben e fit equally from eco nomic na - tion al ism. The class struc ture gen er ates sig nif i cant in equal i ties de rived from lev els of skill, type of oc cu pa tion and amount of own er ship of as sets. Sec ondly, man u fac - tur ing and ser vices are de pend ent on net works which are in ter na tional in scope and can not be sub sti tuted or can only be re placed by na tional units at con sid er able cost. Maynard Keynes ar gued in his ar ti cle on Na tional Self-Suf fi ciency that the costs are worth pay ing, but com pa nies trad ing for profit may not be will ing to foot the bill. Thirdly, trans na tional cor po ra tions re lo cated in host coun tries not only ben e fit the host coun try but also their home coun try by re pa tri at ing prof its. One other po lit i cal draw back of a cor po rate state, with busi nesses driven for profit, is that the state will carry the risks if en ter prise fails, and the pri vate sec tor will pocket the prof its if com merce suc ceeds. Other more so cial ist forms of eco nomic na - tion al ism are yet to ap pear. If eco nomic co or di na tion could take place on the prin ci - ples of plan ning and maxi mis ing pub lic wel fare, many of such dis ad van tages could be averted. Received 22.10.2019 140 Со ци о ло гия: те о рия, ме то ды, мар ке тинг, 2019, 4 David Lane DAVID LANE From Liberal Globalisation to Economic Nationalism? Сontemporary counter movements, universally dubbed as ‘populist’ differ in many respects, but they all agree on a number of significant political and economic issues. First, a condemnation of the economic polices shared until now by the major electoral parties. Second, a criticism that the economic mechanism and political process have led to social polarisation. Third, a contention that electoral democracy has delivered an oligarchic bloc of irresponsible elites who have utilised neo-liberalism to legitimate their own interests. Skepticism about the benefits of the global order is fueled by two political issues. First, the results of globalized markets do not solve many incompatibilities, and this leads to critical movements against the establishment. The second problem is that the economic mechanism must move from the coordination of the global market to public administration. If market coordination leads to booms and busts, enrichment and poverty, some form of administrative coordination is an acceptable alternative. Such political events are associated with economic nationalism. However, a globalized neoliberal economy has created many obstacles to deter governments from pursuing policies promoting economic nationalism. In addition, there are limits to the power of administration — political, constitutional and economic. Anyway, it can be assumed that if economic coordination could be carried out on the principles of planning and maximizing public welfare, many of these problems could be solved. Keywords: ‘populist’ counter movements, effects of globalization, economic nationalism, state management and coordination Со ци о ло гия: те о рия, ме то ды, мар ке тинг, 2019, 4 141 From Liberal Globalisation to Economic Nationalism?

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