George Friedman on Nationalism and the New Economic Orthodoxy

The wealthy lost a great deal after 2008. But what they lost was investment capital, not rent money. The blow for most was not existential. It did not change their lives. For those who used their money for consumption, the impact was substantial. As the trade crisis spread, people lost their jobs, and those who found new jobs were being paid a fraction of their previous salary. 2008 had a different impact on average citizens. But political control remained in the hands of the investor class, which had organized its thinking around the ideology of interdependence. It remained focused on the stability of the financial system rather than the surge in unemployment, underemployment, and the public’s loss of buying power. This played out differently in different countries, but it played out almost everywhere.

********

The issue that 2008 has raised is the importance of nations and the primacy of a national leadership to protect the interests of the nation as a whole, and not the global system or the interests of the financial community. The re-emergence of nationalism is the logical outcome of the failure of interdependence. Part of the assumption of the pre-2008 ideology was that aggregate economic growth benefits everyone. Post-2008 ideology believes that stagnation is paid for by the middle and lower classes. This leads to a political showdown.

********

A new ideology has emerged. It is not yet in power, but it is growing. It argues that the nation-state controlling and limiting its dependence is superior to interdependence. It also argues that the nation-state provides benefits that globalism cannot: a sense of community, the preservation of culture, a sense of self. This argument says that humans without a nation are humans without a community. They are alone, lonely, and helpless. And at the root is the argument that there are more important things than money.

Read it all.

Voting Leave

It's a bright and sunny June day and British voters are determining our future in Europe. For all but the first two years of my life, the United Kingdom has been a part of the European community and there is no question that a decision to leave will fundamentally alter the way in which our affairs, domestic and foreign, are conducted.

While the Leave and Remain camps have both striven to prove the economic benefits of their stance, the truth is that neither side really knows what the final outcome of leaving the EU will be. If the European Union is not the Leviathan that some believe, neither is it the harbinger of an ever more harmonious Europe. Since the end of the Cold War, as continental Europe has sought to promote a more perfect union (to use the phraseology of our American cousins), it has become increasingly insular in its ability both to look beyond its borders and to handle political crises on the periphery. What began with the tragedy of the Yugoslavian civil war has come full circle with the Syrian refugee crisis.

Despite the populist backlash that has enveloped France, Germany and Eastern Europe, the enthusiasm for greater federalism in both Brussels and Strasbourg seems unabated. The only action that may engender greater realism at the political centre is for a nation state of significant economic weight to take the decision to withdraw. My vote to leave the European Union is thus predicated neither on the purported economic benefits nor on the supposed ability to control our borders (my wife and I still had our passports checked while entering France by train two weeks ago), but on the faint hope that it will concentrate the minds of those who set the policies of the EU. There are no guarantees, of course.

Italy, the Austrian statesman Clemens von Metternich once famously remarked, is a geographical expression and "Europe" is no less. The drive to shoehorn European nation states into a "United States of Europe," often in despite of the wishes of ordinary electors, has done more to promote the revival of the less attractive forms of nationalism than the rabble-rousing of the Far-Right.

And so . . . I vote Leave.