Barry Lynn, formerly executive editor of Global Business and now a fellow at the New America Foundation, wrote in Tuesday's Financial Times of London: "[T]he grand trade liberalization project is, at best, on life support . . . Americas free-trade system, constructed with such care in the decades after the war, is crumbling fast. The proximate cause is Americas looming bankruptcy. . . . [T]he greatest obstacle to understanding the failings of post-cold-war globalization is the U.S.s own utopian ideology. . . . [A]fter the fall of the Berlin Wall, in that moment of self-congratulatory euphoria, much of the U.S.s ruling elite came to believe . . . in the ability of an all-determining market mechanism to deliver universal prosperity and peace, in perpetuity. . . . It is . . . the first time a power that strove so relentlessly to sit in the drivers seat of a world system then chose to close its eyes to the road." ...
Comment & analysis
SAVE GLOBALIZATION FROM RADICAL GLOBAL UTOPIANS
By Barry Lynn
Financial Times (UK)
May 30, 2006
Now may hardly seem the time to imagine a more global future, let alone do so with optimism. Most of us are hard pressed just to maintain the illusion that the present system is not breaking down, to deny with conviction what everyone knows -- that the grand trade liberalization project is, at best, on life support.
It is only natural to think conservatively, even defensively, when witnessing the collapse of an empire. Few outside the U.S. doubt that Americas free-trade system, constructed with such care in the decades after the war, is crumbling fast. The proximate cause is Americas looming bankruptcy. As the ongoing Doha round of world trade negotiations has already proved, the U.S. simply lacks the currency -- in the form of believable promises of sustainable access to the U.S. marketplace -- to buy the next round of trade liberalization, as Washington has bought every round since the 1960s. Clearly no other nation is willing or able to take Americas place.
Yet we will find no better moment to begin, once again, to imagine a world in which expanding trade helps to promote a more just, secure, free, and peaceful world. This is because there is no better time than today to face up to the two fatal flaws of the radical globalization project that in the early 1990s came to supplant the more careful trade liberalization of the postwar era: first, Americas utopian belief that an unregulated market would somehow do the work of government; and second, the rise of global companies -- especially in the retail and electronics sectors -- to fill the power vacuum created by the retreat of the American state from its traditional role managing U.S. trading relationships.
Similarly, there is no better time than now to grasp that the real question is not, as Americans like to frame it, free trade versus protectionism. It is whether the world trading system will be regulated by private companies that are answerable only to the rich and powerful, and are profoundly unequipped for the task of processing complex information for the sake of society, or by states built to assess risk and to be answerable to all citizens.
It would be Pollyannaish to deny that grave dangers abound. The last time a free-trade system unwound, when Britains invisible empire vanished almost overnight in the 1880s, one result was a scramble for territory. Europes powers carved up Africa, then began to hack away at China, in a process that helped set the stage for the First World War.
Already today, two scrambles are under way. One aims to grab keystone parts of the global industrial system, as nations ranging from Japan to South Korea and China to France resurrect a variety of mercantilist tactics to seize and hold industrial operations. The other scramble is for greater control over natural resources, especially oil. Although neither scramble poses an immediate threat to peace, both only exacerbate the biggest danger the world now faces: the extreme fragility of our highly specialized, cross-border industrial systems.
By far the greatest obstacle to understanding the failings of post-cold-war globalization is the U.S.s own utopian ideology. For most of the nations history, America was guided by deeply realistic thinking, and idealistic rhetoric was trotted out mainly to clothe cold strategic aims. But after the fall of the Berlin Wall, in that moment of self-congratulatory euphoria, much of the U.S.s ruling elite came to believe the rhetoric itself. The result was a uniquely American, fin-de-siècle paganism -- absolute faith in the ability of an all-determining market mechanism to deliver universal prosperity and peace, in perpetuity -- which was then hawked abroad with evangelical zeal.
This is not the first time an imperial power has imagined a link between the workings of empire and the benevolent actions of some higher force. It is, however, the first time a power that strove so relentlessly to sit in the drivers seat of a world system then chose to close its eyes to the road.
It is the first time that the central director of a hyper-complex industrial system has had so little ability to process basic information about the workings of that system, which is also, by design, the central framework of its empire. The depth and intensity of Americas trade utopianism becomes more astonishing as time wears on. Look at how the U.S. treats oil politics and you will see the realistic America of old. The nations leaders shape an energy policy, they intervene in markets, they invade oil-rich nations. But when it comes to the global trading system, America today operates on an entirely different set of principles. No one dares whisper the words industrial policy. No one dares admit the degree to which the trade system is actually manipulated, not by any state but by companies built to straddle many states. No one dares admit the degree to which these companies tend to destroy not merely soft social infrastructure, such as pensions and wages, but basic production infrastructure.
The dangers of this perverse duality in the U.S. mind are extreme. Yet even in America, the fantastic delusion of trade utopianism cannot last -- it is neither logically nor physically sustainable. Indeed, as can be seen in the growing willingness of politicians in both parties to engage in xenophobic demagoguery, Americas utopian fever seems to be breaking. This brings us back to the question of whether the nations of the world will, together, take proactive steps to expand an open global system, or will stumble into blind and destructive protectionism.
The biggest reason for hope is the prospect of a reformed, sober U.S. Once the American mind is exorcised of todays mechanistic utopianism, the most probable result will be a return to a far more realistic, practical, ethical internationalism. Rather than attempt to retreat into an equally impossible autarky, it is far more likely that America will re-embrace the responsibility of using state power to engineer markets and systems to serve its own people, while ceding to other states far more space to serve their citizens in ways of their own choosing. The next global system will be far more heterogeneous, cosmopolitan, liberal, and flexible than todays.
Utopian universalism is dead. The sooner nations gather to bury its corpse -- and harness, hobble, or break up the immense companies that have grown so powerful in the shadow of that myth -- the more likely we will be to save globalization. This, of course, can happen only if we define globalization, once again, as a political process that must be managed by nation states. The result may not be perfect, and it certainly will be no utopia. But it is the best we can expect on this earth. And that may be enough.
--The writer, a senior fellow at the New America Foundation in Washington D.C., is author of End of the Line: The Rise and Coming Fall of the Global Corporation (Doubleday).