Trump, the Dragon, and the Minotaur – Project Syndicate op-ed


Screen Shot 2016-11-28 at 18.31.37.pngATHENS – If Donald Trump understands anything, it is the value of bankruptcy and financial recycling. He knows all about success via strategic defaults, followed by massive debt write-offs and the creation of assets from liabilities. But does he grasp the profound difference between a developer’s debt and the debt of a large economy? And does he understand that China’s private debt bubble is a powder keg under the global economy? Much hinges on whether he does… [To read on click here]

1 Comment

  • “t was discovered that with interdependence and integration, individual nations had lost control over their destinies. An impersonal system that seemed to be uncontrolled determined the fate of nations and their populations. It also was discovered that the idea that nations were obsolete might be true for elites, who followed capital where it went, but being Greek was very different from being German, and being Chinese was very different from being American. The nation mattered because where you lived determined how you would experience life. And that experience gave you far more in common with your countrymen than with foreigners. Greek bankers and German bankers may live similar lives. But Greek carpenters and German carpenters don’t.

    The year 2008 did not simply reveal the underlying weaknesses of the internationalist position, it also generated a nationalist counter-response. The counter-response was deeply resented by those who continued to be enamored by internationalism, but they had a freedom of movement that their countrymen didn’t. Those below the median income and those who lived in shattered countries were not going anywhere. They were trapped in a reality about which their government could do nothing. The international system was hurtling forward to a frightening and unknown destination. The comfortable ones assumed they would do fine. The uncomfortable ones knew for a fact they wouldn’t be. And they knew that whatever solutions would come would not be a massive global redemption where everyone wins. It would be a hard-fought battle among their own.

    This was the crucial shift. It was a shift from thinking in terms of humanity as a whole to a focus on those with whom they lived and the things and people they loved. As their states lost any relevance to the lives they lived, they turned toward nationalism, to the love of one’s own and the shared fate with those who were like them. This meshed with the cultural. Over the years, the argument had been made that national cultures and practices were irrelevant. It was the ideology of internationalism that mattered, an ideology that deplored all distinctions. Distinctions of ethnicity, religion and nation were the hangovers of the catastrophic world that had led to the rise of Hitler.

    What followed was an attempt by the internationalist state to suppress what it saw as parochialism, and what those who had benefited least from internationalism saw as the fabric of life. The critical point came with immigration, a global phenomenon. Immigration hit both an economic and cultural chord. From the internationalist perspective, we are all part of one humanity. From the standpoint of the rest, the flow of immigration threatened to shatter the cultural foundations of their lives, as well as put further pressure on their ability to earn a living. But the most jarring outcome was their government’s indifference to this. The flow of migrants required flexibility in culture and a willingness to help out. But for the Greeks, or the lower-middle class in the U.S., it represented a burden placed peculiarly on them. Well-to-do bankers would not live in communities torn by ethnic strife, but those who had already been stunned and buffeted by cultural change would. These were the people least able to endure it.
    The result is that throughout Euro-American civilization, the political divide has ceased to be between the left and the right. The new dividing line is internationalist and nationalist. The debate is between those who regard what is now the old system of alliances, mutual responsibility, free trade and transcultural life as essential, and those who regard a globalist perspective as incapable of addressing the vast variability of nations, cultures and classes.

    The question now is whether the dominant political and moral culture of 1945-2008 represents the future or whether it is the past, and a failed past at that. It has been 70 years since 1945, and 70 years is a very long time. The world has changed dramatically since the fundamental principles of the post-war world were laid down. As with all ideologies that have been in power so long that people assume they are the only reasonable approach, an inflexibility has set in. With that inflexibility, internationalism has become vulnerable to challenge by forces it can’t take seriously. Internationalism simply doesn’t see the next punch coming. And when the punch lands and internationalism staggers, its first impulse is to declare its contempt for the bad manners of the nationalist.

    The battle is in the first stages, but it is a battle that was inevitable. The world is vast and humanity is an abstraction. My place in the world, my town, my culture and my nation are conceptually more manageable. The core principle of liberalism is the right to national self-determination. The instruments of internationalism – alliances, trade agreements and international law – run counter to the principles of national self-determination. They ignore the nation and the right of citizens to govern their nation.

    As in all things, the issue is not simple. Internationalism has been dramatically successful in enriching the world since World War II. Its problem is that nationalists charge that only part of the population has enjoyed this wealth, and there are things more fundamental than wealth such as cultural identity and differences. Internationalism is tone-deaf or hostile to cultural identity, which is its weakness. Nationalism has not yet defined the limits of national enclosure.

    This has a long way to go. But looking back, it is no surprise that the Republican and Democratic parties are in utter disarray in the U.S. The points of reference they have represented and the dogmas that have driven them have not disappeared, but are forming around the new points of reference: nationalism and internationalism. Neither party knows what to do with those poles. Nationalism may not simply triumph, but internationalism cannot simply stay the way it is.”