President Trump has brought to the surface a nationalist sensibility that has been latently present in the conservative movement for a long time. In September, he told the United Nations General Assembly that the future belongs to “patriots,” not “globalists.”
Trump has also blamed “globalism,” an intricate ecosystem of international treaties, alliances, and organizations, for all manner of domestic ills. “America is governed by Americans,” the president told the U.N., not by unaccountable bureaucrats. European allies in NATO are not “paying their fair share.” Free-trade agreements, in Trump’s telling, have generally been “rip-offs” for workers. The European Union, meanwhile, was set up to “take advantage” of the United States.
Trump’s criticisms, like earlier critiques by conservative intellectuals, are not without merit. It is true, for example, that many international agencies have outlived their original rationale and often reinvented their mandates. For some on the political Left, international institutions are handy tools to try to change domestic policies through the back door, to the understandable ire of conservatives. Worse yet, some U.N. agencies, most prominently the Human Rights Council, have been hijacked by unfriendly regimes and turned into sad caricatures of themselves.
Trump is not the first U.S. president to complain about Europe’s “free-riding,” and he is not wrong to do so. And while free trade and free-trade agreements have been overwhelmingly good for America and the world, and account for only a miniscule labor market churn here in America, it is also true that since its entry into the World Trade Organization, China has taken advantage of the open multilateral trading system, oftentimes to the detriment of Western companies.
An overdue conversation about the need to update and reform international institutions is different, however, from recklessly shattering an international system that has served us well. Owing to its sweeping nature, the populist revolt against “globalism” risks achieving exactly that, without worrying about how the broken pieces are to be put back together.
Since the end of World War II and the establishment of American-led alliances and international institutions, wars and battle-related deaths around the world have declined. And despite the recent news of “democratic backsliding” in countries such as Turkey or Hungary, democracy has spread. Since 2001, the number of democracies has exceeded the number of countries ruled by autocrats.
Even in the era of Trump, conservative defenders of national sovereignty have long made an allowance for NATO, which they see as essential to U.S. interests. Yet, legalities aside, by its open-ended commitment to come to the defense of allies, expending blood and treasure if necessary, NATO represents at least as significant a sacrifice of national sovereignty as joining the EU or the myriad U.N. agencies that conservatives criticize. In that sense, the anti-NATO arguments long made by crude foreign policy realists and paleoconservatives display more consistency than the mainstream conservative position. It’s only a matter of time before they gain more currency within the GOP.
Humankind has become vastly more prosperous with extensive international cooperation. Since 1950, the world’s population has roughly tripled; over the same time, real output has increased by more than a factor of 10. In Botswana and South Korea, real per capita incomes have grown 38 and 30 times, respectively.
Global prosperity is a direct outcome of economic globalization. Compared to automation, trade accounts for a tiny fraction of total job losses in the U.S. Meanwhile, cheaper consumer products imported from overseas have been among the most effective anti-poverty “policies” in the Western world.
Far from being a transfer of manufacturing jobs from the West to developing countries, economic integration has primarily taken the form of a decentralization of economic activity. In the past, most firms operated as “boxes,” confined to one country, at most with subsidiaries marketing their products in other countries.
Today’s corporations look very different. Starting with Toyota in Japan, business models and value chains have become far more decentralized and complex, spanning across borders and involving hundreds of firms. The production of Boeing’s Dreamliner jet relies on a network of some 1,000 suppliers. General Electric operates in 170 countries, IKEA has stores in 37 countries, and the supply and assembly of Apple products occurs in 30 countries.
Instead of managing every step of the production process within one firm, as was the case in the old corporate boxes, today’s corporations let their suppliers make myriad autonomous production decisions. Adding the internet to the mix, the emerging economic relationships in this flat global economy are as difficult to nail down as jelly.
This would not be possible without technological changes that have dramatically cut the costs of transport and communication. But equally important is the open trading environment created by successive rounds of multilateral trade liberalization under the General Agreement on Tariffs and Trade and, later, the World Trade Organization.
A flat economy raises vastly different policy challenges than an economy of boxes confined to national territories. When firms are interconnected and mobile, rules and regulations adopted in one country necessarily affect others. Typically, that strengthens the case for policy coordination between countries, as it does on many environmental questions. Formal international treaties, incidentally advanced by conservative governments in Britain and America, have put an end to some forms of air pollution, especially by chlorofluorocarbons. At other times, however, concerted international action is more difficult, as on climate change. Sometimes, it is a source of risks. Having a global regulatory monoculture in finance, for example, might make the world’s economies more vulnerable to unseen sources of systemic risk.
A globalized economy has implications for political governance. Conservatives’ frequent invocation of national sovereignty suggests that a return to a different, simpler world of self-governing nation-states and corporate boxes is possible. But that really isn’t on the menu — at least, not without undoing a lot of the economic fabric binding the world together and making us prosperous.
Britain is learning the hard way that extricating a country from a 40-odd-year project of economic and political integration entails difficult economic trade-offs. A “hard” Brexit means disrupting the business of firms used to operating under a common regulatory environment. A “soft” Brexit, in turn, means giving up control of rules that will continue to affect the British economy. Those options are less a result of the EU’s intransigence or nefarious machinations and more because economic and political integration create benefits that are no longer available when the project is scaled back.
Besides ignoring the reality of the globalized world, these new “national conservatives” take a highly selective and flawed view of the past in treating political nations and nation-states as endpoints, or basic facts, of human history. In his book The Virtues of Nationalism, Yoram Hazony, the host of this year’s inaugural National Conservatism Conference, describes political nations as organic extensions of preexisting tribal and family bonds.
Yet Europe’s history since the collapse of the Roman Empire reflected efforts to balance unity, provided by a common religion and set of cultural references, against diversity and political fragmentation. What resulted were forms of governance that combined a significant degree of decentralization with overarching frameworks of rules. Examples include the Holy Roman Empire, the Hanseatic League, or even the classical gold standard. In contrast, the modern nation-state is a recent and by no means “natural” creation. Rather, it is a result of deliberate and sometimes violent efforts at ethnic and cultural homogenization in the second half of the 19th century, followed by two world wars and the Great Depression.
Intellectually, too, the affinity between conservative thought and the nation-state is far more tenuous than opponents of “globalism” suggest. The Catholic personalist movement, for instance, which provided the intellectual content for center-right Christian democrats in Europe, insisted on the artificial, Jacobinic nature of Europe’s nation-states and called for a federalist or covenantal form of political organization on the European continent, respecting the principle of subsidiarity.
When the Lippmann Colloquium, a group of free-market thinkers, gathered in Paris in August 1938, its participants foresaw the destruction brought about by unfettered national sovereignty. Without shared, enforceable rules, nothing stopped nations from pursuing destructive protectionist and militaristic policies. Those attending, including Friedrich von Hayek, Ludwig von Mises, and Wilhelm Roepke, became vocal proponents of international federalism, an intellectual project aimed at taming nation-states through political integration.
The postwar reconstruction of Europe and the project of European political and economic integration, as well as a wider set of international institutions created under U.S. leadership, reflected only partly the insights of classical liberal and conservative thinkers. For others, globalism was purely a technocratic exercise, devoid of deeper governing philosophy. The World Federalists movement, in turn, which enlisted center-left figures such as Albert Einstein, sought to supersede nation-states with a new global government.
Today’s globalist reality, however, corresponds far more to the constrained classical liberal vision. Instead of a single, top-down global government, there has been a Cambrian explosion of mechanisms, treaties, international organizations, and informal rules. True, the EU may resemble a federal or confederal state in some respects. But the European project remains an outlier in the world of international organizations, in which diversity and overlapping jurisdictions and a seeming messiness are the norm.
It is, for example, not only national governments that set up international organizations. The International Air Travel Association is an association of airline carriers that sets most of the standards and regulations guiding international air travel while lacking any political mandate. The highly influential International Organization for Standardization and the International Electrotechnical Commission are also private sector creations. Local governments create associations that transcend national borders. Canadian provinces and U.S. states, not the American and Canadian federal governments, stand behind the Great Lakes Charter, which commits them to sustainable management of the lakes’ water.
As a result, globalism is best understood through the prism of polycentric governance, a term associated with 2009 Nobel economics laureate Elinor Ostrom and her husband, Vincent. She built her research career studying bottom-up governance, such as local irrigation systems, fisheries, and other common-pool resources, identifying a handful of practical design principles that make them work. These include limited mandates, mechanisms to exclude or sanction rogue actors, ease of exit, venues for dispute resolution, and the preservation of internal autonomy of actors who join such governance arrangements. Such principles, she argued, can be applied at the international level, too.
Likewise, Vincent Ostrom, an influential scholar of American federalism, saw successful international institutions not as technocratic creations but rather as organic extensions of existing polycentric governance: “Nation-states need not be viewed as the ultimate achievement in the organization of human societies. If patterns of associated relationships are to transcend national boundaries, rich networks of voluntary associations need to be complemented by rules that take account of communities of relationships that are multinational in character.”
Most important, the desirability of international cooperation often hinges on political regimes of the countries involved. One of the major limitations of the U.N. is that it gives an equal footing to autocrats and democracies. Likewise, the China-led Asian Infrastructure Investment Bank or the Russia-dominated International Investment Bank are not “normal” multilateral organizations but instruments of power projection by our adversaries, and should be treated as such.
The best way to confront such challenges is not to withdraw but to engage. The worst service conservatives can render to the international order is to seek to smash the system indiscriminately in an effort to recreate an ahistorical utopia of autonomous nation-states living together in harmony. Conservatism used to be defined by prudence in dealing with political, institutional, and cultural arrangements that work, broadly speaking. It is time to rediscover that central quality, particularly in international affairs.
Dalibor Rohac is a resident scholar at the American Enterprise Institute in Washington and author of In Defense of Globalism.
