Matthieu Creson on Globalisation: A Comment
By Duncan Whitmore
In a recent essay posted on this blog, Matthieu Creson decried the apparent retreat from globalisation in the wake of COVID-19 and “the withdrawal of countries into themselves”, risking the loss of “what has been for more than half a century one of the main growth drivers” in rich countries and poor countries alike. While Creson is right to be concerned by the possible return of protectionism and economic isolationism, his monolithic conception of globalisation is unlikely to prove helpful when defending its beneficial elements.
Creson is more than keen to explain to us what these beneficial elements of globalisation are:
Extreme poverty affected more than a third of the world’s population in 1990; today it only concerns 10% of this same population, even though the world has seen in the meantime an increase in population of 2 billion human beings. What is more, there has been a drop in infant mortality of more than 50% […] Every day, and in spite of the increase in world population, 140,000 people are able to escape from extreme poverty.
He does not, however, detail specifically the precise qualities of globalisation that produce these marvellous results. Quite a few times, Creson complains that problems caused by the state and statism, such as environmental disasters, are blamed for being “intrinsically linked to globalized capitalism alone”, and that “whenever a world crisis breaks out, they always blame it on globalized liberal capitalism, which they see as moribund”:
Globalization has always functioned as a convenient scapegoat, which saves us from having to acknowledge the (often statist) origins of the evils for which we make globalization unduly responsible.
But he offers no reason as to why academics, pundits and commentators are seemingly able to get away with this blame game so easily when, as he rightly recognises, it is usually states that cause these problems whereas the kinds of economic progress brought about by globalisation can and should ameliorate them.
Creson also fails to mention some of the other problems attributed to globalisation – namely, the shipping of manufacturing jobs oversees to cheaper workforces in the Far East, leaving behind decimated rust belts in once proud industrial regions, and the transformation of Western economies into financialised, consumer driven service providers. Regardless of whether one believes that the overall benefits attributed to globalisation outweigh the costs, to those whom they effect these are very real problems with very real political consequences (Trump, Brexit etc.) which cannot simply be brushed aside by aggregated growth statistics.
The reason for these omissions is that Creson fails to realise that globalisation is not a unitary phenomenon, and that it can, in fact, be used to describe two different trends that are likely to produce two very different outcomes: economic globalisation (or what we might call internationalism) on the one hand, and political globalisation on the other. The former is characterised by a widening of the international division of labour and an increase in the available pool of resources that can be traded between private individuals and entities, regardless of where they are in the world. It is these qualities that would provide justification for Creson’s claim that the “decline of [globalisation] would be disastrous for developing countries, whose economy is highly dependent on foreign direct investment.” Political globalisation, however, consists of the increasing consolidation and centralisation of states and state entities into supranational institutions and the ceding of national executive authority to the texts of trans-national treaties and agreements, in addition to the (albeit weakening) financial hegemony of the US Dollar. It is these elements of globalisation that serve to concentrate wealth and power in an ever dwindling number of hands, stifling local tax and regulatory independence and competition, as well as shovelling ever greater quantities of confiscated tax wealth between countries rather than just within them. Often, all of this proceeds under the ruse of combating so-called “global” problems like “poverty” and “climate change”. Regulatory “harmony” and the mirage of reduced protectionism and border restrictions allow this economic strangulation to proceed under the guise of “free trade”. Far from being a return to classical liberal ideals, the Thatcher/Reagan era helped to progress political globalisation by enabling the expansion of a state apparatus fuelled by paper money, while its “free market” elements of lower taxes, privatisation and deregulation camouflaged the insidious effects that we are seeing today – namely, severe financial crises, bank bailouts, and sluggish real growth – and allowing this fallout to be blamed on “the dictatorship of profit”. Thus, neoliberalism is not an inapt term for the kinds of policies spawned by the 1980s, although “neo-statism” may well be more accurate.
Creson seems to be clueless about all of this. He is, for instance, clearly committed to the false notion that international free trade depends upon so-called “free trade agreements”. He makes no mention of the fact that these, such as NAFTA, are typically 1000+ page shelf bending behemoths, detailing all sorts of intricate rules and regulations that stifle competition for the benefit of large, politically connected corporations. Such agreements can also have de facto protectionist effects if, say, they mandate labour standards which poorer countries simply cannot afford to adhere to. Real free trade is, of course, an absence of any state involvement in trade, and can only blossom in the long run if states withdraw their interventions one by one. Trade agreements, on the other hand, simply elevate state interference from being unilateral to multilateral under the disguise of lifting tariffs and achieving regulatory “harmony” that hides an increased, overall economic burden. Contrary to Creson, commitments to free trade in charters or paeans to the principle at international conferences should arouse suspicion, not praise.
Creson compounds this ignorance by suggesting that “while [economic] systems are more interdependent […] policies have failed to evolve accordingly, and have in fact become ever more fragmented.” This suggests that, as private, economic actors become more interdependent across borders then so too should states. But the interdependence of states is precisely what we do not want. International trade, peace and prosperity depend upon containing political power and authority in units that are (preferably) as small as possible, not unleashing its havoc across the globe.
Creson tells us that globalised “interdependence should […] encourage us to set up greater cooperation, exchange of information and mutual aid between the countries which are exposed to similar risks.” He praises the “cross-border sharing of information and co-operation” during the so-called COVID “pandemic”, and that “China can learn a lot from the United States about the virus, and how to manage it, it can send experts and equipment to help.” But he never tells us precisely who in each of these countries should be doing the co-operating, exchanging and aiding. Who should be sharing information with whom? Who owns the equipment and who employs the experts? Is it states or is it private individuals and entities? The answer makes all the difference, and yet Creson seems to lump them all together. We can certainly agree that “everyone would in fact benefit from living in a world even more open to exchanges between countries, be they intellectual, cultural, scientific or economic,” but the kinds of benefits that Creson expects from globalisation will only come to fruition if state involvement in this regard is minimised. Creson may claim that it is “globalization which made it possible to act [against COVID-19] in record time.” This, however, relies upon experts in different countries being able to act independently of political interference in order to assess the gravity of the situation and to furnish an appropriate response. They can then share that information with each other so that treatments can be developed and traded across borders. States acting in concert, however, have all proceeded in lockstep down a single, sequential path – pandemic, lockdown, second wave, new normal, and vaccine – with almost no deviation from a strictly controlled narrative, deploying the appropriate propaganda accordingly and banning the dissemination of alternative analyses and plausible treatments. Sweden, which Creson mentions, is an outlier.
In fact, Creson’s naivety regarding the nature of the state rivals the laughable kinds of performative evenhandedness that you could read from an Economist intern. After elucidating the virtues of an adherence to “liberal capitalism”, Creson tells us that this “does not mean, of course, that the state has no role to play in a crisis like that of Covid-19”. This role, however, should, “in these times of health crisis” be based upon the principle “first, do no harm”. But is it not globally interconnected states that have overridden this principle and wilfully trashed the entire world’s economy together? Creson amplifies his cluelessness when he explicitly decries the scope of the state:
Perhaps the time has come to stop believing that there is necessarily a correlation between the scope of the state within society and its capacity to make good decisions and act quickly and adequately. In countries where the state is still too present in sectors which should not be under its control, the state tends to be both invasive and ineffective: it is by limiting the states’ sphere of influence, […] by further liberating civil society from excessive state control, that the state will thus be able to fulfill its role effectively, for it will then only intervene within its sphere of legitimacy.
Regardless of what you think the state should and should not do, it seems to me that you are never going to contain the state within any “sphere of legitimacy” unless you are quite clear that you are also prepared to contain it within the sphere of its own borders. The impetus of states is to expand their plunder in as many ways as possible – it is not the case that they have good intentions but are merely incompetent or inefficient. So it is unrealistic to imagine that we can gather them all together in a global sphere of interdependence while expecting them to magically “restrain” themselves to a handful of “legitimate” functions.
To top it all off, Creson seems to have crumbled into regurgitating the “everything I don’t like leads to Hitler” line that is too often deployed for the purposes of neutering opposition. After elaborating on the economic turmoil of the interwar period and praising the post-war visions of Roosevelt and Morgenthau, he preaches:
If we had fully reflected on the lessons of economic history since 1945, we would have been well aware of the misdeeds likely to result from the return of nationalist withdrawals and the revival of protectionism. So let us hope that history does not become again, especially among populists of all kinds, this “piece of writing designed to meet the taste of an immediate public”, in Thucydides’ words.
Between the lines we can clearly see Creson’s deeper implication that any kind of retreat from “globalisation” – political and economic – will lead once again to depression, world war, gas chambers and genocide. This is a false choice, and indicates that Creson has a kind of “grossly erroneous interpretation” of economic history similar to that which he ascribes to Marine Le Pen. For another important factor in this history was a series of political consolidations, namely: the forced union of the formerly sovereign states following the American Civil War; the Hapsburg domination of Central Europe that eventually morphed into the Austro-Hungarian Empire; the unifications of Germany and Italy; and the creation of the Soviet Union. It is difficult to imagine that, without these factors, any of the “economic history” preceding the horrors of the twentieth century would have occurred, and so if we wish to truly relegate it to the past then it is imperative that we embrace economic internationalism but political localism.
“Nationalists” and “populists” are rightfully rejecting globalised political institutions. By giving credence to the false dichotomy of global vs. national in all respects, Creson concedes to opponents of globalisation that their agenda necessarily has to sweep away free trade and trans-national economic co-operation. A far more penetrating analysis of globalisation that separates its economic elements from its political elements is needed if Creson hopes to save the international division of labour from a resurgence of protectionism and isolationism.