Questioning globality: Ethically responsible alternatives to the global economic and financial system

I will divide these remarks into three sections: 1. Situation at hand; 2. Causes; 3. Alternatives to the existing world order, and the extent to which these can conform to ethical principles.
First, the situation at hand.
The term “globality” has gained popularity within the English-speaking debate surrounding the Davos summit at the end of the last millennium. (“Responsible Globality” was the general theme of the World Economic Forum 1999.) The term suggests a state of worldwide unity determining the daily life of every human being and resulting from an increasingly complex economic interdependence across all national borders. This vision of one unified world of globality is primarily propagated by supposedly progressive thinkers of the Western world such as Thomas L. Friedman (with the bestseller ‘The World is Flat’) and Kishore Mahbubani (with the equally best-selling publication “The Great Convergence – Asia, the West, and the Logic of One World”). In fact, however, “globality” describes the consequences of man’s desire for profit, which has become limitless due to technological progress, and which is accompanied by an illusion of omnipotence nourished by the very same technical means.

The world continues to be a place of conflict

Since the era of “globality” has been proclaimed, history has rather developed in the opposite direction. It has not come to its end, as Francis Fukuyama, another “progressive thinker” of the Western world, and the apologists of “One World” under the auspices of the so-called liberal market economy reckoned. Once more, I believe, this reveals the problematic nature of all secular apocalyptic visions. Here and now, in 2019, the world is not – whatever one may personally think of it – one large network of universal interaction between all governmental, economic, and cultural areas, in which “freedom” – as it is understood in the West – would have triumphed. The world continues to be a place of conflict, a place of economic, social, and cultural antagonism and tension, in which the most powerful actors are fighting for supremacy.
Global peace is precarious. The key word here – because of time constraints, I cannot further elaborate – would be the Thucydides Trap¹. It must be further noted that, in recent years and decades, the gap between rich and poor has widened in many parts of the world, including in industrialised countries. Finally, it can be observed that due to wars of aggression, but also due to the prosperity gap, migration flows have increased enormously, which has unsettled previously stable regions, and even turned them into areas of conflict.

Growing mistrust and alienation instead of a global consciousness

Succinctly put, this empirical finding shows that a global consciousness has not actually formed anywhere, however much the globalists prescribe it to all of us. In fact there is a growing mistrust between the still existing blocs and groups of states, the so-called international actors. There is also a growing alienation on the level of world views and civilisations, for instance in the relationship between the Islamic and the Western world.

Unfettered pursuit of profit and the reduction of trade barriers around the world

This brings me to the second part of my remarks, the question of causes.
The decisive event to have led to the state cursorily sketched above was the unleashing of a global pursuit of profit, as it occurred after the elimination of barriers that still existed in the era of bipolarity – that is, during the time of the East-West divide. It was the “victory” of the “liberal” economic system, as proclaimed by the Western world – although one would now have to diagnose this proclamation as premature. This alleged victory of one very specific economic model constituted the beginning of the problems we are facing at present. One must also see this development in close connection with the military power struggle in recent years and decades
Moreover, we can observe the reduction of trade barriers within the World Trade Organisation (WTO), which – from a Western perspective – also meant that former adversaries are gradually incorporated into the system.
The global, essentially ideological, claim to dominance of the liberal economic model is also relevant in this context. This becomes especially obvious if one attentively reads Mahbubani’s bestseller of 2013. Ultimately, the ideology of economic liberalism is not being challenged. The fact is, however, that the free reign of market forces, as it is being propagated under the name of “globality”, is tantamount to anarchy not only on a regional level, but also and especially on the global level. Right now, we are seeing this once again in the wake of trade conflicts – indeed trade wars –, which are erupting or resurfacing in various parts of the globe.

Tendencies against the universal claim to power

At the same time, we can observe that these developments, following the law of actio and reactio, strengthen the tendencies against the universal claim to power by a model that proclaims itself victorious. There are new regional and global alliances, or rather forms of cooperation, which can be interpreted as reaction to these developments. Examples are BRICS (a framework for the cooperation between Brazil, Russia, India, China, and South Africa), the Shanghai Cooperation Organisation (SCO), or, as of recently, the Eurasian Union.
The conflicts of interest and formation of blocs I am referring to here are no longer primarily military, but also economic and civilisational. They are also crucial additional factors contributing to the systematic instability and unpredictability of the geopolitical situation.
It must further be noted that the dynamic of actio and reactio has not only mobilised the forces of economic alliance. There is also a type of reaction against the ideological primacy – the universal claim of power – of the neo-liberal economic model. Recent developments in China and Russia demonstrate this most clearly.
Such a reaction can also be seen on the sociocultural – i.e. macrosocial – level. In spite of, or perhaps because of, the internet and the continuous bombardment of information and propaganda, a form of disassociation from economic liberalism is under way in various areas and many regions of the world. Increasingly and in a wide variety of cultures and regions, one can observe an assertion of identity through the emphasis on their respective tradition – indeed the pronounced return to this tradition. This is especially true for the developments in the Islamic world, but also in other major cultural regions outside of Europe, for instance in India.

“Return to one’s own”

Decades ago, in debates about international cooperation, I spoke of the dialectics of identity in the era of technical civilisation and made proposals for a system of peaceful coexistence. In this context, we can also see a growing resistance against the self-appointed global elites regarding social values, political correctness, and so forth. The “return to one’s own”, as this process could be called, i.e. the return to tradition, would not have occurred if globalist pressure and paternalism had not escalated.
The irrational belief in the self-regulating power of global markets simply cannot be maintained. The frequently invoked phrase of an alleged “win-win-situation” is, I believe, misleading when applied to global economic competition. In a large number of constellations, -profit on one side implies loss on the other. One example of this is the situation of manual workers in traditionally industrial countries, including Germany and Austria. Relatively long ago, when discussions on globalisation first began, the Austrian journalist Hans-Peter Martin already addressed this matter in his bestseller “The Global Trap: Globalisation and the Assault on Prosperity and Democracy”. It is superficial to promise that globalisation, if the individuals only resign themselves to the much-praised change, will ultimately benefit everyone. It appeals to a naive expectation of salvation, according to which all problems shall be solved once every border has been burst, once there is no form of restriction on economic and social interactions whatsoever, such that there will be only one unified, all-encompassing global framework.

Sanctions in order to enforce the claim to power

It appears to me that conflicts are now also breaking out openly inasmuch as unilateral sanctions increasingly provoke economic wars on an alarming scale. This has become most obvious in incidents involving the People’s Republic of China and the United States of America. The U.S. sanctions policy overlaps with the striving for political and military supremacy – and, incidentally, contradicts the ideology of globalisation which has, in many countries, acquired quasi official status. Evidently, this doctrine would – in line with the creed of the World Trade Organisation – imply the primacy of free global trade. In practice, however, it is the sanctions that serve the true aim of globalism, as they conserve the power of the bloc which, after the end of the Cold War, declared itself to be the international community. This is how the United States and their allies try to secure their claim to power globally and permanently.
This form of globality is, I repeat, a mirage. Ultimately it is totalitarian. It contradicts the self-determination of peoples, is thereby also anti-democratic, and is most of all, due to the increasing resistance it provokes in all regions of the world, unsustainable. One could think of it as a type of notional construct, which originates merely from the self-assertion of a privileged group of nations, and does not apply to the economic and social reality on this globe.
Today, challenges to the globalist pattern of thought are often discredited as “populism” – or even as an uproar of the losers or of objectors to modernisation. Yet as an independent and free thinking individual, one should not be intimidated by this.

Ethically justifiable alternatives to globalism

This brings me to the third and last part of my remarks: What are alternatives to the project of globalism, i.e. to a project which, as I argue, leads to a misunderstood global unity? And from which ethical principles can these alternatives be derived?
We may not always be aware of it in our everyday lives, but we are all members of – one and the same – humanity; in this sense, everyone is part of a greater whole. To use a somewhat poetic expression – or a philosophical one, in the sense of the German idealist tradition – one could speak of the universality of the human spirit. Every member of the human race partakes in this universality – in every culture, in every epoch, and completely independently from the economic circumstances one lives in. However, for the individual to see themselves as cosmopolitan, as part of a community including everyone else – keyword: Immanuel Kant – does not mean that they have to resign their identity as members of a people, a state, or a civilisation, and exclusively regard themselves as citizens of a world state that ultimately does not exist. This would be a totalitarian illusion, permitting no diversity. On my reading, cosmopolitanism, which I here oppose to the ideology of globalism, rather refers to the unity of all human beings as members of humanity (humanitas); a unity within the diversity of peoples and cultures, not disregarding their very specific, and economic interests. We could express this using a slogan propagated by the UN (albeit originally referring to cultures in the narrow sense of the word): “Unity in Diversity”
Accordingly, the objectives of the alternative considered here are:

1. Preserving freedom: This does not mean arbitrariness, capriciousness, or selfishness, but the possibility for every community – as a people, as a state – to develop and continuously shape their identity without political paternalism. There must not be any precepts set by a self-appointed world authority, nor forced blessings imposed through economic pressure – especially not through economic sanctions. In recent decades, the powerful have increasingly tried to enforce their own understanding of freedom by means of economic coercion, and even, as we could observe multiple times, by the use of military force. If these countries could have their way, such methods would long have become costumary law.
2. Equal rights to the life chances which this earth affords us, and responsible use of technical means: In tangible terms, this entails using resources sustainably and accepting responsibility for the common good mentioned above – and doing so not only regarding one’s own national collective, but the global community as a whole. For an illustration of this, one can turn towards the problematic issue of the Amazon rainforest. (By this I mean the possible global environmental consequences of harnessing the resources of the largest area of rainforest on earth.)
3. Fair global trade: In pursuing the aims I have just mentioned, it is elementary to guard the principle of reciprocity in world trade, and to not ruthlessly enforce one’s own interests. Fairness implies that, whenever one’s own interests are asserted on the international level, everyone else’s are similarly taken into account.

I believe that peace on a global scale can only be imagined if these three objectives are aimed for consequentially and consistently (i.e. without contradiction) - and this means a truly stable peace instead of a situation dominated by increasingly brutal battles for a share of ever scarcer resources. This is also the great dilemma facing global environmental politics.

Reaching these objectives in an ethically responsible manner

The principles and guidelines necessary for realising these objectives in an ethically responsible manner – and this brings me to the end of my remarks – are actually already embedded in the statutes of the existing global organisations. I am primarily referring to the United Nations and its affiliated organisations. The United Nations Charter – its constitution – contains, among others, the principles of non-interference, of non-violence, and also of mutuality, implied by the term “sovereign equality”, which is to prevail among all states. At stake here are also principles which, even though they are frequently ignored for reasons of power politics, are laid down in the statute of the World Trade Organisation. I am mainly referring to the norm of non-discrimination in international trade relations.
The philosophy of a non-globalist alternative to the current world order is beautifully, even poetically phrased in the Preamble to the UN Charter. As is the case almost always and everywhere, it is the implementation that is lacking. The development of technical possibilities, which has made the entire world (one may call it, borrowing from McLuhan, the “global village”) a marketplace around the clock, has created a dynamic of economic activity that requires regulation in line with the above mentioned objectives. This is no call for dictatorial interference, but a reminder of the responsibility that every international economic agent has for the greater whole, the bonum commune of mankind. It is not about “government”, i.e. a global administration interfering with the affairs of sovereign states, but about “governance” in the sense of coordination among equals according to principles to be adhered to by all actors on the basis of mutuality.

Equal economic opportunities versus unchecked globalisation

To be more specific: A just world order in the above-described sense also refers to equal economic opportunities, and, in tangible terms, to the prevention of competitive distortions in the alleged free market economy, also and especially on an international level. To illustrate this, one can think of a particular dilemma of unchecked globalisation: There is a multitude of sovereign states with diverse social, economic, and legal systems. Some countries in Europe apply the system of “social market economy” – in Austria we also speak of “social partnership”. In other countries, the social rights of workers and employees are often defined quite differently. Compared to the Austrian or German model, for instance, social standards are lower in many countries.
In what way do these differences lead to distortions of competition? The sudden removal of all barriers, i.e. all limits, on economic activity may result in a form of unfair predatory competition in this “free market economy”. Under the pressure of profit-making, production will be relocated to where lower standards allow for lower prices. The negative consequences of this are two-fold: Firstly, unemployment or wage dumping in the industrial states will result also in lower standards of living. This development has been apparent for a long time.

No reduction of trade barriers without harmonisation of social standards

Secondly, we need to point out the following: Whereas the relocation of production creates additional income opportunities in poorer countries, these countries will also be under pressure to accept exploitative working conditions, as we can for instance see in Southeast Asia. It is argued that acquiescence is necessary to prevent the circus of production from moving on to countries where the same work is “even cheaper”. Therefore, from an ethical point of view, if trade barriers are to be reduced or even abolished altogether, social standards would need to be harmonised. If not, capitalism prevails in a Wild West manner. Under such circumstances, one should not be surprised about global migration flows and large migratory movements within some regions.
If social standards are not to be aligned, globalised “free” world trade is exploitative and unjust. This is where I believe a sovereign state must insist on its authority. To illustrate what this means in tangible terms, one can look at the structurally similar problems of the European Monetary Union. There is a single currency, the Euro, but there is no unified system of economic and financial policies, which results in the whole arrangemnent being dysfunctional and ultimately destined to fail. It is impossible to take a measure in one area while leaving all else as it was before. Furthermore, addressing the problems of distortions of competition, and fairness more generally, would require reforms in the statutes, especially in those of the WTO and of the ILO, the International Labour Organisation. These reforms could be discussed and initiated at the UN General Assembly. This year’s 100th anniversary of the ILO in Geneva would be a good occasion to think about fairness in the global world of employment. There is, by the way, also a moral responsibility for the religious communities in this matter.
In view of the considerable – in many cases still growing – difference between the alleged commitment to and the actual implementation of the aims I have briefly discussed here, I dare to draw a conclusion based on a common sense that has not yet been fully globalised: As long as there are no generally valid, universally enforceable social standards, economic liberty cannot and must not be “morally unchecked”, and every people – as community of responsible citizens – must be able to independently define and realise their identity, including the pursuit of their economic interests. More specifically: Globalism as the ideology of “one world” – which in fact does not exist anyway – must be put in its place, and precisely in the interest of freedom.
Before concluding, a ceterum censeo: I have not spoken in favour of “splendid isolation”, a romantic idealisation of the return to one’s own, or of a reclusive, autarkic existence. All that I have tried to sketch here is the idea of a genuine international community, in which every state realises its full potential – economically and culturally – in cooperation with all others, and on the basis of equality. Semantically, this is the meaning of “inter-national”, literally: “between-states”. It is not about a form of organisation that is above states (“supra-national”). Internationality means that there are rules that must be negotiated by entities acting independently of each other. Hence, it is not about the state as a standardised community subordinate to the alleged practical constraints of globalisation. It is not about a “globalised” state, but about a state that acts globally on the very basis of its sovereignty and, in doing so, takes up responsibility for the preservation of everyone’s livelihood, not just of its own citizens. To sum it up in a succinct imperative: Cosmopolitan responsibility instead of submission to a globalist dictate!  •

* Lecture at the International Congress “Mut zur Ethik” (“Courage to Take a Moral Stance”) on the topic “Alternativen zu Globalismus und Globalisierung” (“Alternatives to Globalism and Globalisation”) on the 30 August 2019 in Switzerland.

1  In 2012, Harvard political scientist Graham Allison, in connection with the ever-growing global influence of the People’s Republic of China, developed the theory of Thucydides’s Trap. Allison takes up Thucydides’s thought that the Peloponnesian War (431-404 B.C.) was inevitable due to the rise of Athens and the apprehension this caused in Sparta. According to Allison, this theory could be applied to constellations in later epochs, where a previously hegemonic power was challenged by a newly emerging rival, which often resulted in military conflict. Allison believed that in the current constellation, China’s economic and military rise and the corresponding fears of the US could have the same fatal effect. In this context, mutually reinforcing defensive policies on both sides (e.g. within the framework of a tariff war) could potentially lead to a military conflict. [Editor’s note, according to Wikipedia]

(Translation Current Concerns)