12 December 2016

Globalisation & nationalism

As economies and societies around the globe become more and more interconnected and bound within transnational rules and institutions, the range of policy options available to domestic policymakers has declined. Such constraints range from formal rules, such as the acceptance of the free movement of peoples within the European Union, or the asylum obligations that are outlined under the U.N. Convention Relating to the Status of Refugees, or the limits on deficits stipulated in European Union’s Stability and Growth Pact and the implicit economic constraints imposed by global financial and investment flows. Thus, on issue after issue, from corporate taxation, to control over immigration, to fiscal and monetary policy, national elites frequently find themselves unable to deliver policies consistent with public preferences. Instead they have blamed international institutions for their inability to take actions that they privately do not condone. In this way, politicians feel obliged, in the words of Hillary Clinton, to maintain “both a public and a private position.”

Yet the constraints on national sovereignty entailed by global markets and institutions has weakened the mechanisms that once translated popular views into public policy, leading to a “democratic deficit”’ that has left citizens increasingly frustrated with democratic politics, and increasingly with the democratic system itself. At the same time, the institutions of “global governance” have failed not only to provide avenues for popular participation, but also to deliver outcomes that such participation would be liable to generate, such as compensation for the losers from global trade, or protection of the identities and ways of life of local and national communities. In the words of Larry Summers, one of global integration’s advocates, it is a project “carried out by elites, for elites, with little consideration for the interests of ordinary people.”

This frustration has set up a dangerous dynamic, the consequences of which are now only too visible. In many countries, the only viable challenge to an increasingly homogeneous set of decision-makers comes from political parties or movements established by outsiders, such as the tea party movement and now Donald Trump in the United States, or populist parties of the right and left in Europe. These movements explicitly set themselves against a metropolitan and cosmopolitan elite which, they claim — not always without reason — routinely ignores popular demands and policy preferences. As the differences between establishment parties on the left and right have dwindled in many countries, the only way for voters to effect a change in policy has been to rally to parties that reject many of the traditional rules of the democratic game. In this way, as politicians’ responsiveness to citizens has decreased, citizens have been encouraged to turn away from democracy.

- Roberto Stefan Foa, 'It's the Globalization, Stupid', Foreign Policy, 6 December 2016
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