I think if countries respect each other's sovereignty, there will be a line drawn as to how much globalization can be tolerated by each one. That's my humble view.

Many thanks,

Debra

Dear José Eduardo Jorge

It is very interesting and synthetic the message of the reference article (published in the blog of Dani Rodrik) on the dilemma of fully fulfilling the elements of globalization simultaneously; A) Global Economic Integration, b) Democracy and c) National Sovereignty. According to him, he concludes that two of these three elements (b and c), or (a and b), or (a and c) can be fulfilled; But not simultaneously (a, b, c) because they are mutually exclusive.

In its extensive and complete introduction gives all elements to consider that probably in the realm of reality, can be partially fulfilled the 3 elements interacting simultaneously, and this, would make the relationship defective and bad results, or not the best expected or Ideals.

regards

Jose Luis

Estimado José Eduardo Jorge

Es muy interesante y sintético el mensaje del artículo de referencia (publicado en el blog de Dani Rodrik) sobre el dilema de cumplir totalmente los elementos de la globalización en forma simultánea; a) Integración Económica Global, b) Democracia y c) Soberanía Nacional. De acuerdo con él, concluye que pueden cumplirse dos de estos tres elementos (b y c), o (a y b), o (a y c); pero no simultáneamente (a, b, c) por ser mutuamente excluyentes.

En su extensa y completa introducción da todos los elementos para considerar que probablemente en el terreno de la realidad, puedan cumplirse parcialmente los 3 elementos interactuando en forma simultánea, y esto, haría defectuosa la relación y malos los resultados, o no los mejores esperados o ideales.

Saludos

José Luis

Philadelphia, PA

Dear Jorge, 

A good question. 

I suspect that there may be interestingly different analyses of the trilemma.

The basic problem, as I see the matter, is the political inaccessibility of world economic and financial regulation, or as one might equally put the matter, the significant limits on world governance--arising from differing and competing cultural and political traditions and societies. We may reasonably expect small steps in regulating the relationships between and among the peoples and nations of the world, but this is never going to go as fast as the --very profitable-- pace of expansion of world trading relations. Politics is simply much more difficult. The suitable or required political developments and innovations tend to lag behind the quick pace of growing economic interdependence. This creates political stress, both domestically and internationally.  

It is clear that for many countries, and the Western democracies in particular, giving up on democracy, or allowing it to be eroded, is simply not a viable political option. But at the same time, the practice of democratic forms depends on its support within the traditions and cultures of politically organized societies. In consequence, insofar as internationalizing or globalizing corporations represent some threat or de-stabilizing factor for democratic societies, their influence must be limited.

Globalization has had another good run--I count this the third great episode of Western globalization. The first, connected with the settlement of the new world, culminated in the Napoleonic Wars; and the second episode, connected with European colonialism, culminated in WWI. There is always a danger that the domestic instabilities induced will result in international conflicts--as a continuation of economic competitions. Globalization is now slowing, and I think that is to the good.

H.G. Callaway 

Dear Callaway,

If I quickly try to count the great episode of Western globalization, I would propose:

1. The fall for the elite of Christendom: reformation, replacement of aristocratic/religious feodalism by trading elite, rise of nationalism, printing press fueling the new ideologies, period of explorators

2. Gradually depossession of old aristocracy by financial and trading elite.  The british empire and other colonial commercial empire, slave trade, north american settlement and genocide, this is the first phase of globalisation, depossession of the common, creation of market economies, balance of european powers, and rise to the status of major power of Russia and America, and establishment of the gold standard as an international currency for global commerce.  Boom and Bust of capitalists.  Rise of counter social ideologies for protecting societies against the  market ideology.  

3. End of this period with WWI, Russian revolution, Versaille set a peace time economic war by England, France and the US for the destruction of central Europe economies. Gradually rise of socialism in western countries, international communism, fascism in continental Europe to counter both market ideologies and communist ideologies.

4. WWII, the victory of US and Russian and the rise of the global cold war conflict.  The replacement of Colonianist style capitalistic domination by multi-national corporate infeodisation and submission to american rule under cold war pretences. Competition between Russia and America for taking control of decolonisation, passage of control of the primary oil ressource of the middle east from British to US.  Then secret services of the Russian and the US played major role in military coup, armement industry in both super power was a major importance, nuclear competition and the domino doctrine and this period terminate with the oil crisis, defeated of the US in Vietnam war, the deal between Nixon and China and the entering of China in Capitalism, and the fall of the Berlin war and the cold war.

5.  Neo liberal globalisation period.  Only one super power.  Decline of the US manufacturing and its spreading through multi-national delocalisation in the coast of China and rise of China as the main industrial center.  Credit as the main engine for stimulating consumption, Communication revolution allowing even more concentration of profit, Diminution of democratic power in all liberal democracies, subsumption to financial elite.   2008 crisis signal the beginning of the end.  The greek crisis, the Brexit, Trump election are other signal that the middle class in the west whose living standard has been decreasing for three decade from wage decline.  Protest against massive immigration in the West.  Demand for a return to democracy.  Massive rise of electronic surveillance.  Use of media by China, Russia, Middle east to enter the propaganda war.   Re-emergence of Russia.  Long term strategy by China  to become the new  global superpower.    

So presently in the West we are at a new critical point where we will either goes along a de-marketization and re-democratisation and de-globalisation but we presently do not know how to do that or we will go along a fascish path and a new cold war.  We are back to a situation were marketisation has run its course and either a new fashism or new socialism have to take over.

Dear,

Thank you for sharing and for the reasoned exposition of the questioning.

In particular, I agree with Dr. Sharon and would add another point: when there is social corrosion, hunger, corruption and misery in a country, such as Venezuela's current case, sovereignty is no longer something to help and Intervention would be the best way?

Greetings!

Dear all:

Thanks for your interesting answers. 

Dear Callaway and Louis:

You have raised the fascinating topic of the history of globalization and its possible evolution in the coming years. 

Much of the arguments I tried to summarize in the introduction are linked to the historical conception of globalization posed by Richard Baldwin (2016): The Great Convergence. Information Technology and the New Globalization. Cambridge, Massachusetts: Th e Belknap Press of Harvard University Press. 

I try to summarize below Baldwin's "long history of globalization"::

Phase One: Humanizing the globe (200,000 BCE to about 10,000 BCE)

For something like 190 of the past 200 millennia, “production” mainly meant food that was tied to par tic u lar locales and seasons. Production and consumption were spatially bundled. Little trade occurred. Globalization meant a burgeoning human population traveling to exploit ever- more- distant production sites.

Phase Two: Localizing the global economy (10,000 BCE to 1820 BCE)

Production and consumption were bundled as before, but with the Agricultural

Revolution, food production was brought to people rather than viceversa. The world economy was “localized” in the sense that production and consumption occurred in fixed locations. Trade was still diffi cult and thus rare. Globalization in the modern sense had not yet begun. Prices inside nations were determined primarily by local supply and demand conditions, not international ones. 

Phase Three: Globalizing local economies (1820 to about 1990): The Great Divergence 

One of the greatest dramas in human history was played out in Phase Three. It was an astounding reversal of fortune. Since civilization first saw daybreak, the consumption / production clusters in Asia and the Middle East presided over world affairs. The ancient civilizations also dominated the planet’s economic activity. By the end of Phase Three, all this was turned upside down.

The technological breakthrough that started this reversal was the steam revolution. Steam power allowed humans to conquer intercontinental distances and reshape the world. Productivity surged in the North and this sparked a cycle of industrialization, agglomeration, and innovation that yielded a huge North- South knowledge gap. Th is knowledge imbalance, in turn, led to an unprecedented divergence of incomes known as the Great Divergence. 

This world-changing drama can be told as a three-act play. 

--Act I: 1820 to 1913.

The setup introduces the viewing public to the “hero” (falling trade costs) and other main characters (trade, industrialization, urbanization, and growth). Act I lasts almost a century. 

--Act II: 1914 to 1945.

The confrontation sees the hero faced with daunting setbacks that leave theatergoers wondering whether globalization is doomed. The Act, which lasts a mere thirty years, lashes the hero with two world wars and the Great Depression. Audiences gasp as protectionism raises its ugly head and war forces a rebundling of production and Consumption. 

--Act III: 1946 to 1990.

The “resolution” comes in Act III when the trade-cost hero regains her aplomb. For forty years, trade costs are reduced by trade liberalization and transportation innovations. The unbundling of production and consumption advances as never before. 

Phase Four: Globalizing factories (1990 to present): The Great Convergence

The revolution in information and communication technology (ICT) was to the second unbundling what the steam revolution was to the first. By relaxing the constraints that had underpinned the vast imbalances in the global distribution of knowledge, the ICT

Revolution unleashed a historic transformation that might be called the Great Convergence. The North deindustrialized while some nations in the South industrialized. The world experienced a shockingly large shift in world GDP shares that has made a big step toward reversing the Great Divergence.

Philadelphia, PA

Dear Jorge,

Many thanks for your historical commentary.

However, I think that going back into the dim reaches of prehistoric times is somewhat doubtful here. Historical patterns are closely related to cultural patterns, and going that far back, the similarities of cultural patterns become rather strained. I suspect it makes little sense to speak of trade and exchange in economies which lack for money and developed means of exchange, and in consequence the prehistory is a rather doubtful term for comparison to modern and contemporary developments. Moreover, we know very little about what happened in prehistoric times. We can talk about prehistoric trade, certainly, and I have little doubt that there was some. But it is modern, developed patterns of trade which are more of interest for present purposes. They are more likely to eventuate in similar outcomes.

You wrote:

Phase Two: Localizing the global economy (10,000 BCE to 1820 BCE)

Production and consumption were bundled as before, but with the Agricultural

Revolution, food production was brought to people rather than vice versa. The world economy was “localized” in the sense that production and consumption occurred in fixed locations. Trade was still difficult and thus rare. Globalization in the modern sense had not yet begun. Prices inside nations were determined primarily by local supply and demand conditions, not international ones. 

---End quotation

The claims here seem to me, again, quite doubtful. Following the Europeans' discovery of the Americas, as I think is very well known, there was the "age of exploration" and eventual colonization of the new world. Spain in particular became extremely rich and powerful, because of gold and silver from the New World, and this stimulated endeavors by its European competitors, Great Britain, France and Portugal in particular, to share in the colonies and new found riches.The age of exploration was quite definitely an age of seeking national advantage through wider trade and conquest.

More generally, the 18th century was a time of intensive competition between Great Britain and France for the control of North America. Wealth was produced by commerce, and colonies insured markets for domestic producers. France colonized Quebec, and Louisiana, in particular, while the British colonies were chiefly along the Atlantic coast. One may take the time to read Burke, in his reports to Parliament, on the benefits and profits of the Atlantic trade.

The competitions for trade and colonies in North America produced a linked series of wars, including the Seven Years' war, ending in 1763 (sometimes regarded as a very first "world war" since it was fought around the world), the American Revolution, fought with French aid, and the War of 1812 as well--while the main theater of the conflict shifted to Europe and culminated with the Napoleonic Wars. Trade was very much treated as a means to power and competitive advantage.  I think it simply false to claim that in the period down to 1820, "Trade was still difficult and thus rare. Globalization in the modern sense had not yet begun." 

Its more a matter of how much and what kind of globalization was going on. But in relation to political competitions of the European nation states, trade played a very important role in the 18th century --comparable to its role in the European competitions for trade and colonies which culminated in WWI. During the Napoleonic Wars, each side attempted to control or prohibit the trade of the other. The British restrictions on neutrals were very important in the origin of the War of 1812.

As you see, I am sticking by my "three great episodes of Western globalization" --and the dangers implicit in them. In terms of cultural patterns, I think 10,000 BC (the dawn of agriculture) has little significant relation to 1700, let alone 1820.

H.G. Callaway

I think that global economic integration and national sovereignty are incompatible to each other. Democracy enhances economic integration (at global or national level) and national systems.

That are my personal opinion.

Jose I just read question in bold. Probably right if we see the current scenario. But believe it is highly difficult to achieve all the three together unless otherwise All Nations strive hard.

“democracy, national sovereignty and global economic integration are mutually incompatible: we can combine any two of the three, but never have all three simultaneously and in full”

Not true. Switzerland refutes it utterly—on all three counts. 

Democracy.  The people vote at about ten national referendums per year.  The result—the decision of the people—is final and no court is even permitted to comment.  Every law passed by both houses of parliament is liable to referendum if 50,000 signatures demand it.  50,000 is not many and decade for decade, six per cent of laws suffer such a referendum (and half of these fail).  Switzerland is by far the most democratic country.  The stock joke is that Switzerland does not have a government, only an administration. 

National sovereignty.  A Swiss passport has long been both the world's most desired and most difficult to obtain.  Not only is there a lengthy residency requirement and other conditions but approval by local ballot has to be obtained.  No one guards national sovereignty more fiercely than the Swiss. 

Global integration.  There are no tariffs.  The Swiss borders are open and EU citizens are free to work there.   Switzerland has more UN agencies than any other country.  (This is where the Red Cross started.  Geneva was the headquarters of the League of Nations.)  Switzerland rivals Australia for having one of the highest levels of foreign born residents in the world. 

So Richard Baldwin's central theme is factually incorrect.  There is obviously no "inherent incompatibility with democracy."  The trilemma is a myth.  You say nation states inflict transaction costs.  Yes they do.  But not Switzerland.  Why not?  Because it is a democracy.  The real cause of the world's problems is dependence on leadership.  The transaction costs are from those leaders, those experts, not the people.  Switzerland has no transaction costs because of democracy, not despite democracy.  There is evidently no "paradox."  The solution to the problem of global integration is democracy. 

Finally—just a sort of minor incidental point—Switzerland, which has no natural resources except scenery, has for decades had one of the world's highest per capita GDPs. 

All the above information is available by using Google. 

Thank you for the summary of Baldwin's book.  In phase three Switzerland, freed from Napoleon, never again went to war.  The first modern federal constitution was in 1849 and you could say the country had completely sorted itself out by the end of Act I (by1919 to be precise). Through the next two acts and into Phase Four, this country, open to trade like no other, steadily increased its prosperity.  Surrounded by war and fascism, it stayed peaceful and free. 

All told they must have had about 700 national referendums.  That is 700 chances to close the borders or otherwise wreck the country.  Perhaps a third of these were proposed amendments to the federal constitution.  (There are many canton and municipal referendums as well).  Always the vote is on an explicit law and the result is law and absolutely final.   

Philadelphia, PA

Dear Pepperday & readers, 

It may be true, as you say that democracy is the key to world economic integration, but if so, then it still might take centuries of democratic process to achieve it --world wide. In the meantime, since world-wide agreement about appropriate measures of commercial and financial regulation are unavailable--due to differing national interests and cultural perspectives, then continued expansion of globalized trade --along with its large-scale finance--runs continual risks of collapse --of the sort which we saw in 2008 and the subsequent "great recession." 

The fact that Switzerland is democratic, peaceful, prosperous and economically integrated in Europe tells us very little about the prospect of some higher democratic synthesis which would facilitate world economic integration. The UN has been discussing world problems for many decades, but it has never amounted to anything approaching an effective world government. (Nor was this really expected--note that the institution of the "veto powers" was there from the start.) This is not a criticism of the U.N., though, but it seems an appropriate reflection on the real difficulties of prospective world political integration sufficient to appropriately regulate economic and financial expansion on the largest scale. Even E.U. Europe has run into very significant economic and financial problems (the debt crisis), because it has risked economic integration without sufficient political integration. (Consider the famous "democracy deficit.") The world-wide problems are deeper still. 

Trade expansion is comparatively easy--and very profitable. The politics of international relations, on the other hand, is comparatively, much more difficult and problematic. Yet trade expansion eventually requires agreed international regulation. 

H.G. Callaway

--Dear Pepperday:

You have put forward a very good argument, which, from my point of view, suggests that the Trilemma may have a workable solution for certain countries. The problem, I think -much like Callaway has reasoned-, is that a solution at a global scale would require that at least the main economies manage to coordinate their trade and financial exchanges in a democratic environment. It does not seem achievable at the moment.

--Dear Callaway:

What you say about the problem of going back to prehistoric times to conceptualize current globalization trends is very reasonable. Since Balwin probably will not join us to share the conversation, I feel compelled to reproduce his argument. He writes:

"Why go so far back? The reason is aptly expressed in this 1957 quote:

Since we are all too much affected by the times in which we live and are too prone to generalize from transitory circumstances, we are not likely to gain a clear understanding of [globalization] if we simply start with existing conditions and attempt to disentangle the major factors currently at work 

"This first sentence in the book Economic Development (written by my father Robert Baldwin and Gerald Meier) originally had “economic development” in place of “globalization,” but the thought rings true all the same. Today’s discussions on globalization are indeed “all too much affected by the times in which we live.” Globalization’s impact on the world economy was fairly steady for the past 170 years— a fact that led many observers to view it as immutable. U.S. president Bill Clinton, for example, called globalization “the economic equivalent of a force of nature, like wind or water.” This is wrong. Globalization has changed radically in recent decades, as argued in the Introduction. Part I goes way back to show that the magnitude of globalization’s recent change is not out of line with historical experience."

'Life will find the way' its the same like Global Economics Intregation maybe for this time China India and Arabian countries take over for mote business in United State and Europe however we trust about the statement above.

Philadelphia, PA

Dear Jorge and readers, 

An element of the current--and past--configurations of globalization which has not been sufficiently emphasized to this point is how it effects the balance between large-scale and smaller scale business and enterprise domestically. Insofar as globalization or international economic and financial integration affect this balance, they also affect domestic politics--and not merely by the pronounced tendency to shift manufacturing jobs to lower-wage countries and locations. International investment banking is simply a very different kind of enterprise, as contrasted with domestic banking which evaluates local investment and facilitates local commerce and savings. International financial actors and markets are more prone to simply seeking out the best market rates of return with less attention to fundamentals, and partly in consequence it has the reputation of being more speculative and risky. Overall, globalization tends to shift political power toward support of higher-risk forms less open to control by traditional domestic agencies of regulation. 

In American history I think it fair to say, the dominance of big business and big finance have left a prevalent skeptical attitude. We see in the anti-trust laws the inclination toward domestic political control and regulation by means of breaking up firms which attain excessive size and influence over their respective markets. One way to think of this is in terms of "Wall Street vs. Main Street," or big business vs. small business. There are similar laws and tendencies in Europe. But it is remarkable how the recent European debt crisis rested on a failure to regulate international banking within Europe --with the result that tax payers were left with the huge obligations resulting from bad loans. I long perceived a considerable tendency to regard the large European banks as something like "national champions," and this is another way of saying that overly large, internationalizing firms tend to acquire undue political influence and power. Some smaller countries in Europe are still suffering the consequences of the debt crisis. It is not entirely past. But if we imagine a repeat of the process, then the resources for bailouts are going to be extremely limited.

What I want to suggest, overall, is that globalization tends to generally favor the large-scale over the smaller scale; and the prevalence of the larger scale has a tendency toward forms of corruption of domestic democratic political processes. We see the results of this in the growth of inequalities around the world.

The purely economic processes of globalization are, in the end, self-limiting, because they eventually generate domestic inequalities and other forms of domination. As things stand and for the foreseeable future, democratic processes are much more effective domestically. At the largest scales, they are rather toothless. In consequence, the plea for continued globalization at the same or similar rates that we have seen in recent decades will often sound like an apology for elitism and an apology for the influence of big money.

H.G. Callaway

Philadelphia, PA

Dear all, 

Here is a short backgrounder on my theme above of the corrupting influence of the large-scale actors of globalization. Its a book review from the NYTimes on the Volkswagen scandal --still unfolding, as I understand the matter.

Driven Off Course: How Volkswagen Got on the Road to Scandal

By BETHANY McLEANJUNE 5, 2017

See:

https://www.nytimes.com/2017/06/05/books/review/volkswagen-scandal-faster-higher-farther-jack-ewing.html

The firm is partly owned by one of the German states; and, last I heard, there were some serious questions in the German media concerning how the dubious practices got past the political control on the firm's board of directors. 

H.G. Callaway

Dear Callaway:

If corruption practices like the one you exemplify with the Volkswagen case are not uncommon in countries with reasonably stringent controls and comparatively low levels of bribery, you can imagine what happens in nations where controls are very flawed and public corruption is high, as is the case in most parts of South America.

Dear readers:

I thought it was convenient to add this piece of Baldwin's book, in order to clarify one of the central points of the issues we are addressing.

The attached graph shows that in 1820, when the proposed Old Globalization wave starts with the steam revolution and the lowering of transport costs, China + India concentrated 49% ofr World GDP, while the current G7 industrialized countries represented 22% of World GDP.. Near 1990 the shares of both groups has totally reverted. Just then the New Globalization starts, and with it the "Reversal of Fortunes". Although in 2014 the G7 still represents 46% of the World GDP, its trend is downward, while China+India trend is upward. This is the "great convergence". 

Dear all:

As Rodrik makes clear in his book The Globalization Paradox (2011), his Trilemma does not mean that a commitment with democracy would mean the end of globalization. The author argues that democracy and national determination should prevail over hyperglobalization.

But he claims that re-empowering national democracies by establishing some international rules that leave "substantial room for maneuver" by national governments would lead to a better globalization, because it would place the world economy on a safer, more stable footing. 

Since I'm not an economist, I won't risk an opinion on the specific proposals Rodrik advances about new international rules in the areas of world trade regime, global finance, and labor migration. But I think his basic idea is sound:

"Capitalism does not come with a unique model..Economic prosperity and stability can be achieved through different combinations of institutional arrangements in labor markets, finance, corporate governance, social welfare, and other areas. Nations are likely to—and indeed are entitled to—make varying choices among these arrangements depending on their needs and values."

In this book Rdorik warned of a possible protectionist reaction, which in fact has taken place, and argued that the focus of multilateral negotiations should change from "removing the remaining vestiges of protectionism" to "expanding the maneuvering room for individual nations rather than narrowing it further through cuts in tariffs and subsidies.".

The current strategy "waste a lot of political and negotiating capital for the prospect of meager economic gains", since import tariffs and other restrictions are already lower than never before. The priority should be "bargaining about policy space rather than market access."

Dear José Eduardo,

The expression ''protectionist reaction'' is pejorative and seems to say that setting obstacle to free trading by democracies is dangerous .  He seems to put bonds on this threat to free trade using contraining multilateral agreements.  Small nations has never had a real voice in such multilateral agreements.  They are the rules of the  bully nations for the benefits of their  protected pet mega corporate.  That supposed great convergence is not a convergence in terms of the benefit of the ordinary peoples but a globalisation of a trading feudal system with some global trade agents with asian state support. 

Philadelphia, PA

Dear Brassard & readers,

I think you have to distinguish between protectionist reaction and over-reaction --to the excesses of globalization. "Protectionist reaction" which would threaten a sudden and catastrophic collapse of the world trading system is, indeed, something worthy of pejorative treatment. What I have in mind is the kind of trade wars which broke out during the 1930's and which exaggerated the great depression of that decade. To start down that road all that is needed is for one of the greater trading powers to raise import taxes, to protect domestic industry and jobs, and evoke the same sort of policy from other major trading powers. 

Far better, in my estimation, is to allow the whole thing --the international trading system-- to cool down. We don't need new international agreements to further expand international trade. We do need remedial efforts to alleviate the damage already done. One may doubt that this can be easily accomplished by international agreement. Perhaps in some cases it can, but if not, then it will have to be done domestically. As things stand, democracy and national sovereignty are effectively tied together. Going the route of international agreements, we seem to only get exaggerations of current problems --implicit in the political power of the various national (political and economic) elites and their inclinations to trading favors. 

It may be that you also neglect the interrelations of domestic corporate power and domestic politics and politicians. Think of it on the "Buffalo model": Back in the Gilded Age, many a great family company was headquartered in NYC. So, the first son would inherit control and the second son would go off to Buffalo (the second largest city at the opposite end of the state)--to be a big fish in a smaller pond. Often these second sons would become noted "radicals" and Democrats--critics of what they left behind in NYC. But, and this is the point of the parable, they would not likely become so critical as to threaten the family firm. In exchange for control, the "Buffalo crowd" got "radical chic."

It is said that this is more or less how Grover Cleveland became President--back in the late 19th century--only to be succeeded by Mckinley and the big-business Republicans in 1896. This was in spite of a strong populist challenge to a system which was impoverishing western and southern farmers--while industrialist got ever richer. Its not easy to distinguish the serious critics from the purveyors of radical chic. That's what their "success" depends on. Its a good indication, though that their projects and proposals are utopian and impractical. 

International economic integration, in any case, needs a rest. Our various "elites" also need to wake up to the damage they are actually doing to democratic societies. Unfortunately, they are too often captured in their own bubble-systems of political correctness and "the next big thing." 

H.G. Callaway 

Here are a few comments to comments. 

“...at least 25 democracies have failed since the turn of the millennium...”

This is nonsense.  No established democracies have ever failed unless you count Germany 1933.  The democracies are as tough as old boots.  Those conquered in WW2 instantly reverted to democracy when the German jackboot was lifted. 

Francis Fukuyama ... claimed in 1989 that ... liberal democracy was “the final form of human government” 

He is right.  It is the final form.  None other is viable.  They have been tried and they failed.  Catastrophically failed.  Those who claim this or that incident proves Fukuyama wrong are like people who say this or that snowfall disproves global warming. 

If we want more globalization, we must either give up some democracy or some national sovereignty.

Here we see the real agenda: democracy is bad!  But look around: it is dictators and corrupt regimes that limit openness to trade, not the democracies.  It is a (would-be) demagogue in the US, who wants to close off trade. 

The collapse of the Argentine convertibility experiment of the 1990s provides a contemporary illustration of its inherent incompatibility with democracy.

Argentina is not a democracy.  Until yesterday it was run by a murderous junta inflicting horrific outrages.  It never will be an established democracy for it has a directly elected president.  This encourages demagoguery and populism and it doesn’t work (apart from in the US where it sort of works).  The Latin American countries are all presidential; they have no chance to develop stable democracy.  Each sooner or later fails and some are in a state of more or less permanent chaos. 

One day Chile will fail again, as will other directly elected president countries such as Indonesia, Philippines, South Korea.  When that day comes it’s bad news for the people and bad news for free trade. 

The fact that Switzerland is democratic, peaceful, prosperous and economically integrated in Europe tells us very little about the prospect of some higher democratic synthesis which would facilitate world economic integration.

Switzerland is not economically integrated in Europe.  In fact there have been two national referendums where EU integration was explicitly rejected.  No country is more open to the whole world than Switzerland.  Swiss sovereignty is ironclad and the country is open irrespective of what other countries do, irrespective of (maybe because of?) its lack of integration.  If every country did the same—i.e., just saw to its own affairs democratically—the whole world would be peaceful and prosperous. 

...the Trilemma may have a workable solution for certain countries.

Certain countries?  Ones with pure mountain air—or what? 

Switzerland proves the “trilemma” is a myth.  There isn’t even any evidence for it.  It is a proposition from people who don’t trust the hoi polloi, who want experts to run things.  It sounds logical that things should be run by experts but it’s wrong.  It ends in tears.  Experts have to be answerable to the people. 

Around the world, surely it is obvious that open trade is where you have democracies.  It is in despotic China where there are barriers (Google eventually simply walked out, Apple is currently grovelling to the government), not in democratic countries. 

And democracy ensures sovereignty.  Wealthy Chinese are shipping their money out of China as fast as they can, buying property all over the world.  The Swiss don’t do that.  In China among important people there is little sense of sovereignty.  Compare with South Korea where, during the 1987 financial crisis, people contributed gold to keep the government solvent. 

...the plea for continued globalization at the same or similar rates that we have seen in recent decades will often sound like an apology for elitism and an apology for the influence of big money.

Yes indeed.  Elitism and big money.  So obviously the answer is democracy. 

The Swiss don’t have any control over globalisation and yet they are not blown about by its cold gusts as citizens of other countries (particularly the US) are.  Why?  Because in Switzerland the people run the country.  Every foreign treaty—every one—has to go to referendum.  In Canada and Australia, where the people have more democratic input than in the US, the populist backlash is also less pronounced—and living conditions are better. 

“Nations are likely to—and indeed are entitled to—make varying choices among these arrangements depending on their needs and values.”

Well, nations don’t choose.  Governments choose.  And governments don’t choose depending on “needs and values.”  (What actually are they?  How do needs and values in China differ from, say, France and how would this affect government choice?  The words have no meaning.)  Governments choose according to how answerable they are to their own people. 

Pontificating about how governments should behave in international dealings is mostly irrelevant.  What drives governments is the extent to which their country is democratic.  Swiss negotiators can say (but do not need to) to their foreign counterparts: “There is no point trying to convince us of that proposal because the people would reject at the referendum.”  Imagine how different NAFTA and the TPP would have been if they had had to go to national referendum in the US (which has never had a referendum on anything).

Our various "elites" ... need to wake up to the damage they are actually doing to democratic societies.

Yes.  Well, dream on. 

Well done and thanks for your writing about this issue  

Philadelphia, PA

Dear all, 

Readers of this thread may want to take a look at the following review:

http://carnegieendowment.org/2017/08/15/kleptocracy-in-america-pub-72836

The piece appeared in the current issue of Foreign Affairs, and is reproduced by the Carnegie Endowment for International Peace. 

This work is a critical review of a new book by Robert I. Rotberg of Harvard University, The Corruption Cure, published by Princeton University Press.

I quote the opening paragraph:

"Drain the swamp!” the U.S. Republican presidential candidate Donald Trump shouted at campaign rallies last year. The crowds roared; he won. “Our political system is corrupt!” the Democratic candidate Bernie Sanders thundered at his own rallies. His approval rating now stands at around 60 percent, dwarfing that of any other national-level elected official. Although many aspects of U.S. politics may be confusing, Americans are clearly more agitated about corruption than they have been in nearly a century, in ways that much of the political mainstream does not quite grasp. The topic has never been central to either major party’s platform, and top officials tend to conflate what is legal with what is uncorrupt, speaking a completely different language from that of their constituents.

---End quotation

A central idea here is that we need to see corruption in moral terms, not simply in terms of existing law--i.e., what people can currently get away with. The author of the review, Sarah Chayes, is Senior Fellow in the Democracy and Rule of Law Program. 

An introductory lecture on the book under review can be found here:

https://www.youtube.com/watch?v=lyKVdlDPB3Y

Though the video is over an hour long, and the questions and discussion are quite interesting, Rotberg's lecture runs only about 25 Min. The session was held at Oxford University in June 2017. 

H.G. Callaway

The answer is, that we can have a balance of all three, each accomplished to a partial extent.  What this arrangement will require is on-going negotiations and mediation to keep up with ever-changing circumstances.  It is not feasible to expect or demand complete implementation of any one of the three objectives; trade-offs will have to be recognized, acknowledged, and utilized - we do not live in a perfect world, and getting some of each is better than getting none!

Philadelphia, PA

Dear Sheridan, 

Your idea of a "balance of all three" sounds reasonable, and it seems difficult to dispute. We can certainly all agree that we have a less than perfect world and that international trade requires continued attention and negotiations. It is unreasonable to resist all trade-offs of one value against another. 

At the same, time, it strikes me that the answer you offer is somewhat less than specific and that we may wonder, in light of it, just what configurations you may favor. To speak of balance and trade-offs makes references implicitly to some sort of base-line or presently existing configuration. Considering in particular, "Economic Integration, Democracy, and National Sovereignty," you don't really say how you see the present configuration or what changes or developments would seem to you more reasonable.

Again, trading off democracy against world economic integration would seem to be a very controversial and doubtful sort of suggestion. There are those, of course, who are willing to diminish democracy in order to increase international trade--or to control the domestic economy. That, in fact, is one of the most problematic aspects of the present international situation. If we were convinced, of course, that we would have to sacrifice democratic control of government to increase international trade, then it would seem to be something of a deal with the devil --that many would reject.

One notices, in this connection that the recently proposed trade expansion agreements were chiefly negotiated behind closed doors, and it is not even clear whether our elected representatives have been aware of the course of the negotiations and what might have been involved. That is one reason why these agreement have not gone through. 

What is your position on the related questions and problems?

H.G. Callaway

Suggesion to read:

Károly Polányi: Origins of Our Time: The Great Transformation. London: Gollancz (1945)

Károly Polányi:Trade and Market in the Early Empires: Economies in History and Theory.  New York– London: Collier-Macmillan (1957)

Yesterday (Sunday) I attended the annual picnic of "the Ottawa Creative Thinking Group."  There was much talk of various "desirable" alternatives for social reform.  Many were interesting, BUT not one of them included any consideration of what was actually FEASIBLE!  If I was a radical egalitarian, I would support equal distribution of social wealth; if I was a radical elitist, I would support continued unequal distribution of social wealth; BUT neither alternative is actually feasible, regardless of who might like either alternative!  Can we please focus on what is actually feasible, AND how making such feasible alternatives a reality, can happen?  I know it's asking a lot of idealists, but can we give it a try?

Mr. H.G.Callaway,

You are absolutely true:

" There are those, of course, who are willing to diminish democracy in order to increase international trade--or to control the domestic economy. That, in fact, is one of the most problematic aspects of the present international situation. If we were convinced, of course, that we would have to sacrifice democratic control of government to increase international trade, then it would seem to be something of a deal with the devil --that many would reject. "

Philadelphia, PA

Dear Sheridan,

It strikes me that you may want to read some of the earlier contributions to this question and thread of discussion.

You emphasize "what is feasible," and I cannot help but be sympathetic to that. But at the same time, we can ask, as well, "What is feasible for whom?" It may be that the only feasible proposals for expanding international trade at the present time depended on keeping the public and even our elected representatives in the dark about the course of the negotiations. But democratically considered, given the untoward effects of some of the past agreements for expansion of international trade, that is democratically unacceptable. 

Alternative agreements or means of reaching them may be unfeasible at present. But if so, that suggests something of the related democracy deficit. Apparently, though, it was feasible to block the recent agreements. That, in fact, is what has been done both in E.U. Europe, --regarding the E.U.-U.S. proposal--the Europeans backed down, and in the U.S. --regarding the transpacific proposal--rejected by the present U.S. administration. 

In North America, NAFTA is currently being renegotiated.  

H.G. Callaway

My suggestion to read Károly Polányí: A nagy átalakulás  The Great Transformation). Budapest: Napvilág Kiadó. ISBN 9789639350519 (2004)

Origins of Our Time: The Great Transformation (angol nyelven). London: Gollancz (1945)

Dear William, Katalin and László:

Thank you sincerely for your answers.

Dear Callaway:

I find very logical and interesting your position. You wrote:

“We don't need new international agreements to further expand international trade. We do need remedial efforts to alleviate the damage already done. One may doubt that this can be easily accomplished by international agreement. Perhaps in some cases it can, but if not, then it will have to be done domestically. As things stand, democracy and national sovereignty are effectively tied together (…) International economic integration, in any case, needs a rest. Our various "elites" also need to wake up to the damage they are actually doing to democratic societies. “

And I cannot agree more with the following:

“Trading off democracy against world economic integration would seem to be a very controversial and doubtful sort of suggestion. There are those, of course, who are willing to diminish democracy in order to increase international trade--or to control the domestic economy (…)  it would seem to be something of a deal with the devil --that many would reject.”

Besides considering on theoretical and normative bases the possible alternatives of solution of the trilemma, I think it also would be interesting to observe what are the choices governments are making in practice and what are the options promoted by other political, economic and social groups in each country.

Democracy + More national determination, without excluding international agreements when they help, seems to be the logical step when deepening economic integration lacks popular support to a point that puts democracy at risk.

I'm afraid, however, that there are governments and economic groups willing to trade-off democracy with deeper integration or national determination (the latter case is the nationalistic / nativist reaction).

In the Southern Cone of South America, I think Chile has managed to find a way out of the trilemma, although its highly unequal income distribution remains an issue. Argentina and Brazil are now seeking to expand international economic integration. But in my opinion I’m afraid both may turn toward a path of lessening democracy in order to implement socially painful reforms in line with the Washington Consensus, which still enjoys broad consensus among the elites. The Argentine government has strongly advanced the idea of changing the Constitution to suppress the midterm elections (our electoral system is similar on this point to the US system), because, according to the official narrative, politicians cannot live on the campaign trail instead of working to solve people’s problems.   

Dear Callaway,

I agree with your pause position.  We do not want a rekless chaotic destabilizing counter movement but we do not want to press on the accelerator either.  Since those that opposed further of the neo-liberal policies on trade do not have yet a clear alternative then better pause and enter into democratic dialogue about what should be done.  

Dear José Eduardo, What is striking about your text is the normative ambivalence about global economic market integration. Experience seems to dictate that, unqualified, it has rather negative consequences. Even countries which agressively integrated into the world market did it with strong state support, though generally under authoritarian governments. So, here, there does not seem to be any paradoxes. Second, considering that democracy is viewed universally as positive normative process or outcome, the only logical solution is, therefore, a modicum --yet to be determined-- of some national (or at least, non-market) sovereignty, under a state responsive to its people (democracy, populism, whatever you wish to call it), for a more intelligent and less unequal form of integration.  

Dear Lewis-Kausel:

I can only give my opinion, but I think that Chile presents some key differences with its neighbors in the Southern Cone that has allowed the country to solve those paradoxes: a political elite that reached a consensus on democratic rules of the game and a clear path to development, low levels of corruption (something that is of utmost importance), and a not too diversified economy, which greatly limits the potential collateral damages of free trade.

Dear Colleagues:

I find highly relevant for the topics discussed here the article on corruption as an "approach to government" --rather than "a problem for governments"-- written by Sarah Chayes, a senior associate in the Democracy and Rule of Law Program at the Carnegie Endowment for International Peace. This piece was published in Foreign Affairs and linked in a previous post by our colleague H.G. Callaway (link that I reproduce here):

http://carnegieendowment.org/2017/08/15/kleptocracy-in-america-pub-72836

I think that the impact of international economic integration on a particular country (and the way the country integrates into the global economy) is highly affected by the quality of its democracy, its degree of corruption and State capture, and its degree of income / social inequality. 

The absence / degree of corruption and State capture should be considered as an essential ingredient of democratic quality. The author observes that corruption is usually ill conceived as an insidious illness, a "plague" that "infects" the government. On the contrary, Chayes underlines that...

"This is what corruption looks in at least 60 countries where I have researched the problem: the deliberate operating system of sophisticated networks bent on self-enrichment and remarkably successful at achieving it. For officials in these places, corrupt acts often do not represent rational responses to a permissive environment (...) rather, they are a professional requirement."

I think this is a fundamental variable we need to take into account to understand how the benefits and costs of international economic integration are distributed domestically. 

Then we have the clear relationship between corruption and income / social inequality, whose empirical evidence is shown in this article in the Transparency International website: 

https://www.transparency.org/news/feature/corruption_and_inequality_how_populists_mislead_people

Quality of democracy, corruption and social inequality are then three intertwined variables, which largely impact on the way a country integrates into the global economy and on the domestic effects of that integration.

Philadelphia, PA

Dear Jorge & readers,

That is a fine summary on the relationship of international economic integration, corruption and economic inequality. Bravo!

As I understand the term, "neo-colonialism," it seems to me clear that international economic integration which tolerates or depends on local corruption will tend to foment the local corruption in something similar to neo-colonial patterns. By aiding or supporting local corruption it may also prove antagonistic to democratic reform as required to address local economic inequalities.

Do I overstate the matter?

H.G. Callaway

The integration of countries into economic blocs does not guarantee sovereignty, the supranancional state is accessed losing its own sovereignty to access other dimensions: as economic and political. But the strong is still strong and the weak weakest. Nor is it a guarantee of solvency in the face of crisis. At the time of Brexit I wrote this note https://www.academia.edu/29251518/Acerca_del_recorrido_de_la_UE_y_primeras_reflexiones_sobre_el_Brexit . I do not leave them because my opinions have not lost any entity. I'm sorry, I do not have a copy in English.

https://www.academia.edu/29251518/Acerca_del_recorrido_de_la_UE_y_primeras_reflexiones_sobre_el_Brexit

Dear Pedro:

Many thanks for your contribution. Could you post the abstract or a summary of your work in English for the many non Spanish speaking colleagues?

Deat @Jose, sorry for 10 days of delay! It is never late to make a response. Regards and respects.

According to Rodrik's trilemma – national sovereignty, international economic integration, and democracy –only two can be enjoyed simultaneously. ... (pp42)

Fine resource which discuss this issue in terms of EU and multi-level governance...

https://books.google.rs/books?id=gtYtDwAAQBAJ&printsec=frontcover#v=onepage&q&f=false

The following article treats Italy on terms of my previous contribution.

Italy’s ‘trilemma’: How to balance integration, sovereignty and democracy following the constitutional referendum!

On 4 December, Italian voters rejected a proposed constitutional reform in a referendum, with Matteo Renzi subsequently resigning as the country’s prime minister. Nicolò Fraccaroli writes on where the country now stands, arguing that the situation is best captured as a ‘trilemma’ where economic integration, national sovereignty, and democracy create competing pressures on Italy’s economy and political system.

http://eprints.lse.ac.uk/69417/1/blogs.lse.ac.uk-Italys%20trilemma%20How%20to%20balance%20integration%20sovereignty%20and%20democracy%20following%20the%20constitutional%20ref.pdf

Dear Ljubomir:

Thanks a lot for the fine contribution. I'm exploring it right now. It seems the book is fully available on Google Books. 

Dear all:

In the short time I’ve had to take a look at the book The European Union in Crisis (2017), edited by Dinan et al. (and linked by our colleague L. Jacic), a cited work that caught my attention is Armingeon & Guthmann (2014): Democracy in crisis? The declining support for national democracy in European countries, 2007–2011, European Journal of Political Research 53: 423–442.

The paper is available here:

http://boris.unibe.ch/40785/7/ejpr12046.pdf

Analyzing 78 Eurobarometer (EB) surveys conducted in 26 EU countries between 2007 and 2011, the article concludes that “support for national democracy – operationalised as satisfaction with the way democracy works and as trust in parliament – declined dramatically during the crisis that started in 2007/2008”. It adds that this loss of support “was caused both by international organisations and markets interfering with national democratic procedures and by the deteriorating situation of the national economy as perceived by individual citizens.”

The authors argue that “not since the 1950s have advanced democracies experienced such a dramatic external imposition of austerity and structural reform policies through inter or supranational organisations such as the EU and the International Monetary Fund (IMF) or as implicitly requested by international financial markets.” The “most prominent examples” they cite are Greece, Portugal, Spain, Ireland, Italy and the Baltic states.

Generalising from the “indignado” movement in Southern Europe and the “bitter domestic conflicts over the implementation of austerity policies in November 2012” in those same countries, the general strike in Portugal in spring 2012, and the results of the Greek elections in May and June 2012, Armingeon & Guthmann claim that “the very fact that external actors were imposing policies from outside led to an erosion of support for national democracy.”

But I have my doubts about the specific indicators they use (“satisfaction with the way democracy works” and “trust in parliament”) as appropriate measures on “support for national democracy”. In the Latin American context, for example, we have seen that very low levels of satisfaction with democracy and institutional trust (which is often referred as “confidence in institutions”, reserving the word “trust” to describe interpersonal relationships) can coexist with sustained levels of support for democracy.

Indeed, the authors acknowledge that “support for national democracy is a multidimensional concept with its dimensions lying roughly on a continuum from diffuse to specific support, with the former decoupled from actual system performance and the latter reflecting achievements and failures of a specific political system, parliament or government”. They consider satisfaction and institutional confidence “to be located near the centre of the continuum between diffuse and specific support”, although “their exact position cannot precisely be determined and is a matter of debate.”

I think that (diffuse) support for democracy is sustained by some deep rooted values that do not change so quickly, and that xenophobia, for example, poses a much more dangerous threat to European democracies than temporary losses of political satisfaction and political trust.

José Eduardo ,

Are european more xenophed since 2008 crisis.  I do not think so.  It was not a xenophobic crisis but a failure of the economic agenda (neo-liberalism) onto which the Eurozone has been constructed and which politics of many decade in Europe in in the West has been based.  A little lack of confidence in such policies and thus the political was quite normal.  Since all the politicians in all parlements are the one that supported these policies for decades was not it normal to lack a bit of confidence in these parlements?  Trying to shift the blame on xenophobia would be very usefull for that political elite which has basically betrayed their people.  Not necessarily intentionally but by being the promoters of the band wagon that derailed in the view of everybody in 2008.  Austerity has been the responses because the investors have shifted their lost on the people throw the betrayal again of the politician. Is a lack of confidence , a normal reaction?  Xenophobia has to be blame again?

José Eduardo Jorge, Thank you, when I have a little time I will do it. I am very complicated with my activities. Sorry

Dear Louis and colleagues:

Regardless of whether Europeans are more prejudiced against foreigners since 2008 or not, the hard fact is that the vote for populist xenophobic parties has been on the rise. At least in this (crucial) sense, Europeans are certainly more xenophobed. And I insist that those xenophobic parties represent a much more dangerous threat to European democracies than  movements like those of the ‘Indignado’ type..

The key point is: What has produced this xenophobic electoral trend? This is a complex matter. I link two (highly technical) papers on the topic.

I would summarize saying that the answer lies in the confluence of two long term trends: 1) increasing levels of social inequality experienced by most European countries (and the US) since the 70s. 2) A “cultural backlash” (often referred as a “nativist reaction”) against rapid cultural change. Each of these processes has its own causes, but rising inequality has been working to increase the support for xenophobic parties. The crisis that started in 2008 and the influx of immigrants aggravated the trend.

The first (linked) paper (only abstract of the published version and full manuscript) is Inglehart & Norris (2017): “Trump and the Populist Authoritarian Parties: The Silent Revolution in Reverse”.

The second (attached) paper (Inglehart & Norris 2016: “Trump, Brexit, and the rise of Populism: Economic have-nots and cultural backlash”) uses the 2014 Chapel Hill Expert Survey (CHES) to identify the ideological location of 268 political parties in 31 European countries, and employs the pooled European Social Survey (2002-2014) to examine the cross-national evidence at individual level for the impact of the economic insecurity and cultural values as predictors of voting for populist parties.   

https://www.cambridge.org/core/journals/perspectives-on-politics/article/trump-and-the-populist-authoritarian-parties-the-silent-revolution-in-reverse/FE06E514F88A13C8DBFD41984D12D88D

https://lsa.umich.edu/content/dam/polisci-assets/Docs/Inglehart%20Articles/Trump%2C%20Xenophobic%20populists.pdf

Dear all:

The process I referred in my previous post involves what has been described as a gradual trend of “party realignments” that has been taken place since the late sixties and early seventies in almost all industrialized democracies –a trend that perhaps is reaching its limits nowadays.

One characteristic of this process was the increasing prominence of “cultural issues” in the political agenda as a result of deep cultural change. Today it is usually labeled as “identity politics”. It also produced a “cultural backlash” of varying intensity in different countries, which in some cases has given place to the so called “culture wars”.

A consequence was that the parties of the left, which had addressed economic distribution issues during the Post War years, were progressively losing a good part of their voters. A “new left” took shape, centered on cultural issues and better educated, middle class voters, while some of the less educated workers who held traditional values migrated toward parties of the right. This dynamic –a reduction of “class vote”- is clearly illustrated in the case of Democrats and Republicans in the US.

For obvious reasons, this political configuration is ill equipped to deal with increasing economic inequality. Moreover, it is likely one of its causes.

All this suggests that, in order to address the issue of the current unequal income distribution, new party realignments would be necessary.   

In my view, this is an important process that also intervenes in the dynamic of the Trilemma.

Philadelphia, PA

Dear Jorge,

In sympathy with your remarks, and from an American perspective, I would say that the U.S. Democratic party needs to move over to the center, address issues of economic inequality more directly and put aside their identity politics--appealing to citizens and the common good as such. I believe that the view is gaining ground here that the Democrats' multiculturalism has proven to be a "trickle-down" economics --of the left-- which basically isn't working for most people. In the long run it is inconsistent with the political and social integrity of the county. 

H.G.Callaway

Dear Callaway:

Yes. I've been reading a bit about the current discussion in the Democratic Party. Meanwhile, the setbacks that the populist xenophobic parties have suffered lately in Europe -Austria, Netherlands and France-  may not represent a definitive solution to the threat they pose if party systems do not effectively address the fundamental issues. In France, in particular, the traditional parties have collapsed. 

Dear all:

I’d like to add another important piece of information to the discussion.  

Perhaps you have already notice that the Transparency International’s article I previously linked, which analyzes the empirical relationship between corruption and income inequality, mentions Branko Milanovic as one of the current leading scholars on the topic of inequality –along with Thomas Piketty.

Rising inequality has a number of causes and some of them are country specific. Corruption seems to be one of the reasons. Automation is surely another cause. But globalization itself seems to have contributed to the phenomenon.

I’ve read the Branko Milanovic book Global Inequality. A New Approach for the Age of Globalization (2016). Cambridge, Massachusetts: The Belknap Press of Harvard University Press.

I’ve taken from it the attached graph, which is what some people have famously called an “elephant curve,” because it resembles an elephant with a raised trunk. The following explanation is extracted from Milanovic book.

The horizontal axis of the graph shows the percentiles of the global income distribution, ranging from the poorest people in the world on the left to the richest (the “global top 1 percent”) on the extreme right. The vertical axis shows the cumulative growth in real income between 1988 and 2008 (measured in 2005 international dollars) at different points of the global income distribution.

This covers the period of “high globalization”, which, according to Milanovic, brought into the world economy first China, and then the economies of the Soviet Union and Eastern Europe. Also India, with the reforms in the early 1990s, became more closely integrated with the rest of the world. In this period the communications revolution allowed firms to relocate factories to distant countries where they could take advantage of cheap labor without relinquishing control. There was thus a double coincidence of “peripheral” markets opening up and core countries being able to hire labor from these peripheral countries in situ.

Real income gains were greatest among people around the 50th percentile of the global income distribution (the median; at point A) and among the richest (the top 1%; at point C. They were lowest among people who were around the 80th percentile globally (point B), most of whom are in the lower middle class of the rich world.

Point A divides the distribution into two equal parts, each containing 50 percent of the population; one half better-off, the other half worse-off than the people at the median income. People at point A had the highest real income growth: some 80 percent during the 20 year period. But the growth was high for a broad swath of people, ranging from the 40th global percentile to those around the 60th (a fifth of the world population). 90 per cent of the members of this group of beneficiaries of globalization are people from the emerging Asian economies, predominantly China, but also India, Thailand, Vietnam, and Indonesia. They are not the richest people of their countries, but those belonging to the middle-income groups. The members of this “emerging global middle class” are the main winners of globalization (although they are still relatively poor compared with the Western middle classes). For example, the real income of the fifth and sixth deciles of the income distribution in urban and rural China multiplied by 3 and 2.2 respectively between 1988 and 2008.

People at point B is richer than those at point A, but the value on the vertical axis at point B is nearly zero, indicating the absence of any growth in real income over twenty years. These people are almost all from the rich economies of Western Europe, North America, Oceania and Japan. If China dominates at point A, United States, Japan, and Germany dominate at point B. People at point B generally belong to the lower halves of their countries’ income distributions. They are the “lower middle class of the rich world” and not the winners of globalization.

Milanovic clamis that contrasting points A and B highlights “one of the key issues of the current globalization process: the diverging economic trajectories of people in the old rich world versus those in resurgent Asia. In short: the great winners have been the Asian poor and middle classes; the great losers, the lower middle classes of the rich world (…) Politicians in the West who pushed for greater reliance on markets in their own economies and the world after the Reagan-Thatcher revolution could hardly have expected that the much vaunted globalization would fail to deliver palpable benefits to the majority of their citizens.”

Point C represents the people who are globally very rich: the global top 1 percent. Their real incomes have risen substantially between 1988 and 2008. Also these “global plutocrats”, overwhelmingly from the rich economies, are the winners of globalization. Half of them are Americans and the rest almost entirely from Western Europe, Japan, and Oceania.

Milanovic concludes that the contrast between points C and B shows the fact that the income gaps between the top and bottom have widened in the rich world and that globalization has favored those in the rich countries who were already better-off.

I am proud of Branko's work. Thanks for bringing it to this thread. Dear @Jose, for those who want to follow excellent work of Branko Milanovic, serbian expert in world bank, I am attaching link to his profile.

https://www.researchgate.net/profile/Branko_Milanovic

An in-depth, didactical interview with Milanovic about his Elephant Curve on PBS Newsroom (text and video).

http://www.pbs.org/newshour/making-sense/hottest-chart-economics-means/

http://www.pbs.org/newshour/bb/globalization-affects-inequality-populism-one-chart/

Dear all:

Interestingly, for more than a decade, Latin America, which has been for long –and still is- the most unequal region of the world, experienced a widespread decline in income inequality, in contrast to the global trend.

According to the chapter I’ve linked below –published in 2011-, “two leading factors seem to account for the decline in inequality” in four representative countries that the work analyzes: “a decrease in the earnings gap between skilled and low-skilled workers and an increase in government transfers to the poor.”

An updated analysis (2016, in the second link) focuses instead on the still-high levels of inequality of the region. In the context of the “global inequality crisis”, as the article calls it,, Latin America would be an example of “the destructive impact that extreme inequality has on sustainable patterns of growth and social cohesion”.

This piece underlines a number of interesting points:

--“In 2014 the richest 10% of people in Latin America had amassed 71% of the region’s wealth. If this trend continues, according to Oxfam’s calculations, in just six years’ time the richest 1% in the region will have accumulated more wealth than the remaining 99%.”

--“From 2002 to 2015, the fortunes of Latin America’s billionaires grew by an average of 21% per year - an increase that Oxfam estimates is six times greater than the growth of the whole region’s GDP. Much of this wealth is held offshore in tax havens, which means that a sizeable portion of the benefits of Latin America’s growth are being captured by a small number of very wealthy individuals, at the expense of the poor and the middle class.”

--“Poorly designed tax systems, tax evasion and tax avoidance are costing Latin America billions of dollars in unpaid tax revenues - revenues which could and should be invested in tackling poverty and inequality.”

--“Many countries’ tax systems depend heavily on consumption taxes that place the burden on low- and middle-income groups. In addition, the region’s tax systems tend to be biased towards labour income instead of capital gains and usually lack any property and inheritance tax, thus increasing wealth concentration, which is even greater than income concentration. Revenues from personal income tax are relatively low, particularly from the highest-income groups.”

--“Governments are also letting multinational companies off the hook when it comes to taxes, thanks to overly generous discounts on income tax rates in many countries across the region. By some calculations, the effective tax burden for multinational companies is half that of domestic firms.”

--“ Adding to this are the appalling rates of tax avoidance and evasion on the continent, with corporate income tax losses ranging from an estimated 27% of potential corporate income tax revenues in Brazil to roughly 65% in Costa Rica and Ecuador. ECLAC estimates that evasion and avoidance of personal and corporate income tax cost Latin America more than $190 billion, or 4% of GDP, in 2014.”

https://www.brookings.edu/wp-content/uploads/2016/07/declininginequalityinlatinamerica_chapter.pdf

https://www.weforum.org/agenda/2016/01/inequality-is-getting-worse-in-latin-america-here-s-how-to-fix-it/

Mainz, Germany

Dear all,

Briefly, I think that there is some need to turn the current discussion around a bit. It is not greed that should concern us but instead virtue.

I came across the following passage from Montesquieu, The Spirit of the Laws, Bk 3, chap. 3:

On the Principle of Democracy

There need not be much integrity for a monarchical or despotic government to maintain itself. The force of the laws in the one and the prince's ever-raised arm in the other can rule or contain the whole. But in a popular state there must be an additional spring, which is virtue.

... For it is clear that less virtue is needed in a monarchy, where the one who sees to the execution of the laws judges himself above the laws, than in a popular government where the one who sees to the execution of the laws feels that he is subject to them and that he will bear their weight.

---End quotation

From this perspective, given that business is part of the way that market oriented societies are organized, there is a connection between virtue in the citizens and in the rulers, on the one hand, and the degree of consolidation in the economy. It is not so much a matter of greed (though this may become involved) as it is a matter of the ways in which things are customarily done. The tolerable degree or level of economic consolidation may differ from one society to another. But for any society there is some level of consolidation and concentration of economic power which will tend to monopolize opportunity and, in that way, create growing inequalities. Our "captains of industry" may or may not be greedy, what matters more is that they have vast power to make rules on how things are done, and this power often goes unconstrained and unchecked. They may be chiefly motivated to persist in their successful activities--in contrast to personal financial gain--which may be only incidental.

Excessive concentration of economic power tends to deny in fact, if not in principle, the equality of rights and opportunities of all citizens, just because the concentration of financial and economic means (say in corporate hands) is excessive. For example the concentration of means may translate into inordinate influence over legislation--which is supposed to serve the common good. It may mean that certain organizations are capable of buying up possible competition before it becomes a serious alternative. More generally, excessive concentration of "money power" may eventuate in domination over the opportunities otherwise more generally available--and in this way sap the virtue and democratic spirit of the powerful and the comparatively powerless alike. Unlimited means tends to produce a lack of self-restraint in those who control excessive means; while lack of opportunity for the many tends to produce submissiveness.

Consider in this connection the tendency to limit the right of free speech on campus--in exchange for a kind of politically correct "safety." The outspoken are to be suppressed, while the fearful are to be comforted and taken under the wing of protective authority. Project that tendency onto society as a whole and see what you get. The equal right of free speech is denied to those judged political incorrect. That is certainly a sign of the times--and something to be resisted.

Without self-restraint and power to exercise one's rights and control one's own life, there will be no virtue, yet virtue in especially needed in any genuinely liberal democracy.  NB: globalization tends to produce economic and financial consolidation on the largest possible scales.

H.G. Callaway

https://www.researchgate.net/post/Is_liberal_democracy_in_decline

Dear Callaway:

A very comprehensive response that brings balance to the discussion. Well done!

DFJ.

Dear Callaway and colleagues:

I agree with you that in a democracy there is a connection between the virtue of the citizens and in the rulers, and between this virtue and the degree to which power - especially economic power - is equally or unequally distributed in society. Your comment gives us the opportunity to include an appropriate philosophical perspective in the midst of so much technical analysis.

As someone who has studied political culture for more than sixteen years, I knew the passage you quoted from The Spirit of the Laws. As you know, Montesquieu referred to virtue as the principle of democracy largely speaking of ancient democracy. Moreover, he considered that virtue a "passion", a feeling rather than a rational quality.

The Spirit of the Laws is a dual work. When Montesquieu turns his attention to the "modern republic," which is England, the principle of virtue gives way to that of "liberty." The work that virtue did in the ancient democracy was, in the modern republic, in charge of the mechanical work – in a very Newtonian sense of the term – of the division of power and therefore of the checks and balances of opposing forces. In Montesquieu view, from this balanced distribution of power did not seem to emerge any particular virtue. The principle of liberty involved freedom of passions. Virtues and vices seemed to be equally “useful”.

I think that this mechanical view of the functioning of modern democracy present in The Spirit of the Laws – which we find nowadays in some approaches that emphasize the “formal” or purely institutional aspects of democracy – leaves its imprint in many ways in The Federalist, where the status of virtue seems to me a bit ambiguous.

It was ultimately De Tocqueville, who also drew inspiration from Montesquieu, who emphasized virtue as a fundamental principle of modern democracy, a virtue based on “mores,” "self-interest well understood" (that is, reason) and on "equality of conditions,",a more or less balanced distribution of power in society - which required the art of association among citizens.

Mainz, Germany

Dear Jorge & readers,

Many thanks for your interesting comments on my prior note focused on Montesquieu and virtue. I think that in the end we cannot, or dare not, separate democracy and virtue. Likewise, since we have democracy embodied in republican forms and structures, we cannot separate republican forms and structures from virtue. This makes a purely mechanical conception of the balancing and separation of powers less plausible. I doubt that anyone more familiar with the Aristotelian tradition of virtue ethics would think to restrict the need of the virtues to ancient democracy --which, after all, and in spite of all contrasts, were a form of communal republic --in the original sense of Cicero's "res publica."   

Liberty, as we have seen is connected with power, including the power to act against the economic odds. In consequence, it is important to understand the virtues as implying particular sorts of powers --which are cultivated in society or in the individual and which are comparatively independent of external influences and determination. We much prefer, of course, that the virtues should be cultivated in society and in education, so that both the public and our political leaders should be constrained and empowered by the virtues. But even if virtue is more restricted, it remains a perogative of individuals to cultivate the virtues. Liberty without virtue tends to degenerate into mere license. It is not so much that virtues should emerge from the checks and balances of republican forms--though they may--as that operation of republican forms depends on the virtues of the politicans and the citizens. This includes the taming of raw passions into cultivated interests.

Regarding virtue in the Federalist Papers, what comes to mind first of all is the virtue of magnanimity--which traditionally includes the ambition to perform great works in the public sphere. (This was often contrasted with Christian humility.) While there is more to virtue among the federalists, the entire American founding, I would say, is pervaded by the recognition of virtue as crucial to the success of republican forms. Montesquieu does at least recognize, in his contrast of democratic politicians with monarchical or despotic rulers, that the latter require less of virtue --which implies self-restraint in that context. In consequence, a general identification of virtue with passion in Montesquieu would seem to be ruled out. 

I would be pleased to learn more about Montesquieu, since you have studied The Spirit of the Laws. He was very highly regarded by the American founders. I have done some work on the book. 

H.G. Callaway

Mainz, Germany

Dear Jorge,

Here is a short quotation from the Federalist Papers, which seems to be to the point (or part of the point) in discussion:

Federalist Papers, No. 55

(Hamilton or Madison)

The sincere friends of liberty, who give themselves up to the extravagancies of this passion, are not aware of the injury they do their own cause. As there is a degree of depravity in mankind which requires a certain degree of circumspection and distrust, so there are other qualities in human nature which justify a certain portion of esteem and confidence. Republican government presupposes the existence of these qualities in a higher degree than any other form. Were the pictures which have been drawn by the political jealousy of some among us faithful likenesses of the human character, the inference would be, that there is not sufficient virtue among men for self-government; and that nothing less than the chains of despotism can restrain them from destroying and devouring one another.

PUBLIUS.

---End quotation

Although the authorship seems to be unclear, this passage sounds to me more like Madison. This comes from a searchable, on-line edition of the Federalist Papers, available from Project Gutenberg:

See:

http://www.gutenberg.org/cache/epub/18/pg18-images.html

(If the link does does respond to a click, then you can copy it into your browser.)

By the way, Montesquieu explicitly says, in The Spirit of the Laws, that virtue is more needed in republics; and he says that he means by virtue, love of country and love of equality.

H.G. Callaway

Montesquieu’s view, quoted a few posts above, doesn’t make sense:

“For it is clear that less virtue is needed in a monarchy, where the one who sees to the execution of the laws judges himself above the laws, than in a popular government where the one who sees to the execution of the laws feels that he is subject to them and that he will bear their weight.” 

How so? A person subject to the law has no need of virtue. If fear of the law ensures proper behavior, the individual’s venality is irrelevant. 

On the other hand, the monarch, above the law, has only virtue to limit his despotism. A monarch without virtue would soon foment revolution. 

Montesquieu is dead wrong. It is not so surprising—what could this anglophile French aristocrat (or Madison, or anyone) know of democracy in the mid 18C? What M’s Spirit of the laws has going for it is the more general insight that Comte admired: that different kinds of rule suit different kinds of social relations, that the relationship between type of rule and social interaction is predictable.

The claim that democracy requires virtue leads to justifying autocracy. “In this country people are not virtuous enough to handle democracy.” This view is particularly widespread in South America. Over the last century or two, democracy has been tried there time and again and it always comes adrift. Europe and the Anglo countries became stable democracies but the people of South America just aren’t virtuous enough.

Democracy does repeatedly fail in South America but it is because of the presidential system. Directly electing the president encourages narcissism and fuels demagoguery. A country might have a few fairly benign presidents and then some economic pressure occurs and along comes a president who knows how to fix it and soon the country is back to autocracy with its social relations of corruption, cronyism, crime, and cruelty.

It appears the South American presidential countries can never escape. It seems they are doomed to stagger in and out of autocracy forever, always hoping for better “leadership,” but instead being run by scoundrels while millions live in squalor.  

Whether we are greedy or virtuous is academic: human nature is what it is. The task of the political system is to deal with it. Our yearning for the “strong leader” also seems to be built-in and such leaders often bring out the worst in us. Stability and prosperity depend on the institutional structure which restrains the leader—democracy. So democracy has nothing to do with virtue, except for its effectiveness in curbing leaders who lack virtue. 

Mainz, Germany

Dear Pepperday &readers,

Given what you say, I am left wondering if you are somehow adverse to the concept of virtue. I can't really see how you can claim that "A person subject to the law has no need of virtue." I would think that a person has need of virtue whether subject to the law or not.

While it may be that a monarch not subject to the law (Montesquieu is concerned with absolute monarchy and considered the 18th century British system of limited monarchy to be republicanized --plausibly in light of the influence of the English Commonwealth and the Glorious Revolution of 1688-89); and an absolute monarch lacking virtue and self-restraint would eventually face a popular uprising. Still this has often taken a very long time as we count human lives. (Consider the excesses and absolutism of the Bourbon monarchy in France during virtually the entire 18th century).

Montesquieu's point is that an absolute monarch (reigning as such) has less need of virtue than does a republican or democratic ruler who is subject to the law which is to be executed. The absolute ruler, of course, has no need of a fear of the law--such a ruler can make it or change it. 

A ruler in a democratic system, though officially subject to the law may still be tempted to corruption or to political excesses and expediencies. In consequence, the ruler in order to be faithful to a democratic system must exercise self-restraint --which is the first element of any concept of virtue. Montesquieu is particularly concerned with what he calls "political virtue" and which he defines in terms of  "love of country and love of equality." The democratic official charged with the execution of the law must exercise self-restraint to avoid biased or corrupting execution of the law. For example, in terms of Montesquieu's definition, the democratic ruler must put love of country above any inducements which might be offered from abroad, and likewise, love of equality must be placed above any domestic inducements offered in exchange of preferential treatment. 

You seem to have the idea that democracy can function as a kind of mechanical system which has no need of virtue. But I don't see that you have adequately argued against the contrary positions we have briefly seen from Montesquieu and the Federalist Papers. Democracy is actually a very old concept in Western political thought, dating from the ancient Greeks. Aristotle in particular makes many connections between his virtue ethics and themes from his work on Politics. 17th century Europe, in turn, had seen new developments of republicanism (involving popular elements) of which both Montesquieu and the authors of the Federalist Papers were much aware. In consequence, 18th century political thinkers gave much thought to the theme of democracy and its relationship to the virtues. The contrary idea seems most closely connected with the idea of pure value neutrality in politics --which was alien to Montesquieu and the American founders alike. 

H.G. Callaway 

---you wrote---

Montesquieu’s view, quoted a few posts above, doesn’t make sense:

“For it is clear that less virtue is needed in a monarchy, where the one who sees to the execution of the laws judges himself above the laws, than in a popular government where the one who sees to the execution of the laws feels that he is subject to them and that he will bear their weight.” 

How so? A person subject to the law has no need of virtue. If fear of the law ensures proper behavior, the individual’s venality is irrelevant. 

On the other hand, the monarch, above the law, has only virtue to limit his despotism. A monarch without virtue would soon foment revolution. 

---End quotation

Dear Callaway and colleagues:

I welcome this philosophical twist in the thread not only because of its intrinsic interest, but also because I think that a normative and philosophical approach is a very necessary ingredient to shed light on our main theme. 

The points we address in the last few posts apply - or should be applied - to the complex challenges that global economic integration poses to democracy

I would like to begin by inviting you to give your opinion on the perspective of one of the leading living philosophers (in my view, the most important living philosopher), Jürgen Habermas, on the crisis in Europe and the role of democracy and solidarity  in its solution.

In April 2013, Habermas delivered a public lecture in the University of Leuven, Belgium. He proposed the development of a "supernational" democracy, "If we want to maintain the common currency, it's not enough to grant credit to individual insolvent countries in order to put them back on their feet," he said. "Instead, what we need is solidarity and a cooperative approach that results from a shared political perspective."

According to the press release of KU Leuven (link below), the gap between citizens and policy has never been wider. The European Parliament was envisioned as a way to bridge the gap, "but that bridge is almost devoid of traffic," says Habermas. Euroscepticism is the only perspective uniting European citizens today. Meanwhile, policy is determined by short-sighted politicians who push for "more Europe" solely to avoid an expensive exit from the euro. ‪This poses a threat to Europe's legitimacy and democratic basis, says Habermas.

"The promise of democracy is presented as a light at the end of the tunnel. That's a rather dangerous move."

‪Habermas concludes --points out the KU Leuven summary- that the monetary union can only be saved through solidarity: “‪Providing loans to over-indebted states is not enough. What is needed is a cooperative effort from a shared political perspective to promote growth and competitiveness in the euro zone as a whole." Such an effort would require Germany and several other countries to accept short- and medium-term losses, confident in the conviction that solidarity is in their – and our – long-term interest.

Given the subsequent political developments in the EU, what is your view about Habermas position?

https://nieuws.kuleuven.be/en/content/2013/habermas

http://www.dw.com/en/a-philosophical-critique-of-eu-politics/a-16776364

Mainz, Germany

Dear Jorge & readers,

Briefly, I like the stress placed on a "cooperative approach," in your note--as contrasted with "fraternity" or "solidarity." I am reminded of how the American federal union, and "these United States" evolved over time (though not without great conflict, of course) into "the United States." Perhaps there is room to see contemporary Euro-skepticism as analogous to traditional American anti-statism and skepticism of expanded roles of the federal government? The roots are similar. Recall that even Jefferson, early on, regarded Virginia as his "country." Yet in his first inaugural address in 1800, on becoming the third President, he famously announced that "We are all republicans (i.e. democrats), all federalists." On the other hand, Euro-skepticism, rooted in European nationalisms and history, is often stronger than traditional American anti-statism and our skepticism of the centralization of power. Its more akin to the views of the anti-federalist who initially rejected the U.S. constitution of 1789. Few are the genuine European federalists these days--though the economy is looking up.

My sense of the matter is that the Europeans have been too much inclined to use the political model of their own nation states and projected it onto E.U.-Europe as a whole--at which point they find that they don't trust the E.U. that much. They recoil from the prospect. The trick would seem to be to allow for the skepticism, because rooted in European history and still confer adequate powers on the European Union. The call is for cooperation across the national differences. I think this would also imply allowing the prospect of the growth of E.U. democracy. As it is, the national heads of state and government, jointly, act somewhat like an old European monarch, jealous of their powers and reluctant to pass them on to the European parliament. When things go wrong the E.U. is blamed, yet the needed power to act is often withheld by the European states.  

"Either we all hang together, or we will all hang separately" said Benjamin Franklin at the time of the American Revolution. When asked about the result of the constitutional convention at Philadelphia, he said: We have a republic--"if you can keep it." 

Consider, why did James Madison, "father of the constitution," switch from the Federalists to the Jeffersonian Republicans--becoming Jefferson's Secretary of State? Or, again, why did the Jeffersonian Republicans unite in opposition to (Federalist) Alexander Hamilton's first Bank of the United States, allow its charter to expire in 1811, and afterward institute their own, second Bank of the United States--in 1816? 

H.G. Callaway

Mainz, Germany

Dear all,

Here follows a short interview with James Traub, on the theme of "European identity."

https://www.youtube.com/watch?v=XjNRG6wdwSg

Perhaps this will help the discussion along a bit. The Title is "James Traub: European Identity, Liberalism, & Globalization," and the interview was made available by the Carnegie Council for Ethics in International Affairs. "Journalist James Traub discusses the complicated and intertwined issues of European identity, the rise and fall of liberalism, and the "losers" of globalization." The video runs about 6 Min. 

On James Traub, see:

http://cic.nyu.edu/people/james-traub

If I had to summarize the message briefly, then I would say that it concerns the "losers" of globalization, their sense of loss and the significance of this for the future of democratic liberalism. I'm much inclined to the view that Europe is yet to have its "We the people of Europe" moment, comparable to the preamble of the U.S. constitution and its claim to speak for "We the people of the United States." 

If that is the case, then, it is the last thing we in the U.S. should do to adopt the politics of Europe in the U.S. Though some in Europe are adverse to addressing the democratic claims of Europe's nationalities and nation states, the more conservatives American patriots, in contrast, accepted the Union from the start--and, of course, one might think that it is the aim of any liberal reformers to eventually bring the more conservative along. Adopting exclusion of explicitly democratic political thought as a liberal policy may, however, ensure the defeat of democratic liberalism. 

Comments invited. 

H.G.Callaway

Dear Colleagues:

In his conference, Habermas analyzes with some detail the philosophical notion of “solidarity” in the context of the European crisis, in order to “exonerate appeals to solidarity of accusations of moral stuffiness or misplaced good intentions that the ‘realists’ are wont to level against them.”

He points that “showing solidarity is a political act and by no means a form of moral selflessness that were misplaced in political contexts.” We need “to distinguish obligations to show solidarity from both moral and legal obligations”, since “Solidarity is not synonymous with ‘justice’, be it in the moral or the legal sense of the term.”

“We call moral and legal norms ‘just’ when they regulate practices that are in the equal interest of all those affected. Just norms secure equal freedoms for all and equal respect for everyone.”

But there are also “special duties”, like the help that in certain situations some relatives or neighbors would expect to a greater extent than strangers. “Such special duties also hold in general for certain social relations.”

The extent of these “positive duties” varies with the type, frequency and importance of the social relation. If a distant relative asks a cousin for a large financial contribution, he could appeal at most “to a tie of an ‘ethical’ kind founded on family relations (in Hegel’s terminology one, rooted in ‘Sittlichkeit’ or ‘ethical life’). Belonging to an extended family will justify prima facie a duty to help, but only in cases when the actual relation gives rise to the expectation that e.g. the cousin can count on the support of her relative in turn in a similar situation.”

This kind of ’ethical’ obligation “rooted in ties of an antecedently existing community” is based on “the trust-founding Sittlichkeit of informal social relations (…) under the condition of predictable reciprocity”. It “can neither be enforced nor is it categorically required. It depends instead on the expectations of reciprocal favors — and on the confidence in this reciprocity over time.”

Habermas adds that “unenforceable ethical behavior” also coincides with “long-term interest”, and this is the “aspect that Sittlichkeit shares with solidarity.” However, “the latter can not rely on pre-political communities such as the family but only on political associations or shared political interests. Conduct based on solidarity presupposes political contexts of life, hence contexts that are legally organized and in this sense artificial ones.” That’s why “the credit of trust presupposed by solidarity is less robust than in the case of ethical conduct because this credit is not secured through the mere existence of a quasi-natural community.”

Solidarity has also “the offensive character of pressing or even struggling for discharging the promise which is invested in the legitimacy claim of any political order.” This “becomes particularly clear when solidarity is required in the course of social and economic modernization, in order to adjust the overstretched capacities of an existing political framework.”

The concept of solidarity is “an astonishingly recent one (…) only since the French Revolution of 1789 did it slowly acquire a political meaning, albeit initially in connection with the slogan of ‘fraternity’.”

“Fraternity” is “the key concept of the secularized religion of humanity that was radicalized and fused with the concept of solidarity during the first half of the nineteenth century by early socialism and Catholic social teachings.”

According to Habermas “the two concepts became separated in the course of the social upheavals of approaching industrial capitalism and the nascent workers movement. The legacy of the Judeo-Christian ethics of fraternity was fused, in the concept of solidarity, with the republicanism of Roman origin. The orientation toward salvation or emancipation became amalgamated with that toward legal and political freedom.”

Later in the nineteenth century, the appeals to ‘solidarity’ “had their historical origin in the dynamic of the new class struggles,” when “the older forms of social integration broke down.” The “socially uprooted” workers “were supposed to form an alliance beyond the systemically generated competitive relations on the labor market”. The “opposition between the social classes” was finally “institutionalized within the framework of the democratically constituted nation states,” which created their welfare states “only after” the two world wars.

Nowadays, in the context of globalization, “systemic constraints again shatter the established relations of solidarity and compel us to reconstruct the challenged forms of political integration of the nation state.” But this time the contingencies of “a form of capitalism driven by unrestrained financial markets are transformed into tensions between the member states of the European Monetary Union.”

“If one wants to preserve the Monetary Union, it is no longer enough, given the structural imbalances between the national economies, to provide loans to over-indebted states so that each should improve its competitiveness by its own efforts. What is required is solidarity instead, a cooperative effort from a shared political perspective to promote growth and competitiveness in the euro zone as a whole.”

Mainz, Germany

Dear Méndez-Esteban & readers,

It is not, of course, that I recommending viewing the Taub interview because I agree with everything he said! On the contrary, my point was to have an advocate of globalization pointing to the problems--in contrast to those who simply say, "Full steam ahead and damn the torpedoes." In particular, I did not recommend the interview for the sake of its recommendation of globalization, cosmopolitanism, etc. 

Recognizing the motivations for support of ever more globalization rooted in the expectation of personal benefit is crucial--and recognizing that the personal benefits arise by association and not always or exclusively by direct identification with or membership in large-scale corporate and corporate-political configurations and agencies. These entities are recruiting for multicultural staff--"trickle-down economics" of the left, as I've put the matter elsewhere. If the insiders and their associates and supporters chiefly benefit, even at the expense of the common good of any particular country, then this ought to raise serious questions and concerns. 

Compare the history of the American Gilded Age --a time of gigantic economic growth and development in the U.S. --from just after the end of the Civil War up until the outbreak of WWI. We ended up with gigantic corporate concentrations, monopolies and trust, and these business enterprises were chiefly owned by great families and identified with particular persons--who became the targets of the reformer's criticism in the progressive era. But then, as now, there were many among the "progressives" who advocated for the large-scale firms and likely benefited by the association. We are in a more difficult situation, since it is rare that contemporary corporations can be identified with any family or personality. It is all much more diffuse and difficult to tie down. There is much less inclination to critical perspectives on those contemporary "captains of industry" who do catch our attention and that of the media. On the contrary, they are often celebrated. While we may value the economic growth and products of the Gilded Age, few seem to explicitly say that we should do the same again, risking the same untoward effects and social distress in order to benefit in a similar way. But that is exactly what is happening. What is chiefly missing and different is concentrated focus on growing inequalities from the left. This has been displaced by identity politics and special interest groups. 

It is not that I think large international firms always ought to have a specific local  or country-oriented identity, though this might be better in some cases. What concerns me is the dominance of value neutrality, in contrast to pre-established norms and culture, insofar as this undercuts domestic political integrity. Value neutrality and ignoring local customs and norms may, indeed, facilitate the "can-do" spirit of a corporation. I am aware, on the other hand, that films these days are fully of dystopias of world corporate domination. Our political ideals should not be coming from internationalizing business. 

Multiculturalism practices an economic, political and selective favoritismtoward the foreign, the better organized and the marginalized, selecting for membership in the elite; The motivation of supporters certainly includes their seeking such favoritism. But as I say, a nation built upon immigration and integration has to make citizens. That implies putting the advantages on integration --not upon difference or distinctiveness for its own sake. The marginalized groups of American society have not greatly benefited from contemporary policies. Inequality has grown and they have become only less secure economically. 

H.G. Callaway

Mainz, Germany

Dear Jorge,

I would say that the question is always "Solidarity with whom and for what?" 

Lacking the details of the case, we will not otherwise know what we are buying into --that kind of situation may have very untoward effects. Solidarity with the developing world, e.g., may turn, imperceptibly into support for large-scale international finance and commerce. Solidarity with the globalizing world, and "the religion of humanity," may imperceptibly turn into economic support for the authoritarianism of trading partners. 

Current usage mostly dates from the Polish union movement which helped over throw the old Soviet dominated regime in that country. I admired much how they did it--a genuine democratic revolution with minimal violence. We should remember Solidarity --the Polish workers movement. Good. 

Like universal benevolence and fraternity, the ideal of solidarity makes most sense when we already know the "with whom" and the "for what." Otherwise, our loyalties of propinquity and engagement should take priority, since we have in those relations some better sense of what is in question --what is actually being supported or calling for our support. I think I'll better trust to the devil I know, than to those looking to "reconstruct the challenged forms of political integration of the nation state.” --whatever that may mean. 

My experience with universal solidarity is that it builds a hierarchy which then demands conformity without room for questions or examination. 

H.G. Callaway

Mainz, Germany

Dear all,

I hope that the following question may interest readers of this thread:

https://www.researchgate.net/post/What_is_Reinhold_Niebuhrs_thesis_of_Collective_egoism

Your thoughtful answers and responses will be much appreciated.

H.G. Callaway

Dear all:

In June 2016, the Chair for Contemporary History (University of Augsburg) and the Research Network on the History of the Idea of Europe (University of East Anglia) organized an international conference that addressed the current state of academic studies on the solidarity concept in the context of the European Union. 

"How did the pioneers of European unity define and conceptualize “European solidarity”? Which forms of international solidarity were actually practiced in Europe? And what were the limits of the “European solidarity union”?

In their summary of the discussions and presentations, Greiner & Vermeiren (2016) say the following (see full review attached as pdf):

"Solidarity is in high demand in the European context. The Euro crisis, the refugee situation, terrorist attacks and, most recently, Great Britain’s vote to exit from the EU have led to repeated and loud calls for solidarity. Yet whereas the success of the European project gives the impression that European solidarity simply exists, it is not easy to pin down. Is it an emotion, a normative stance, a political slogan? And if solidarity is present, then for whom, why and with what consequence? While

pro-European intellectuals have long appealed to it as a more or less abstract concept, the pioneers of European unity started turning it into a policy. Thus, academic research is confronted with questions about the meaning(s) of European solidarity in different contexts."

The conference ‘The Bonds that Unite? ’ Historical Perspectives on European Solidarity took up the challenge of answering some of these questions

http://www.historyideaofeurope.org/the-bonds-that-unite-historical-perspectives-on-european-solidarity-2/

Dear colleagues:

We have been talking about possible new party realignments in Western political systems. Cas Mudde, who is an expert on populism, has just published an in-depth analysis in The Guardian about the performance of the populist radical-right Alternative for Democracy (AfD) in the German election today. His conclusion:

"At this moment commentators are arguing that German politics has experienced a 'seismic shock'. This is true, but the current election result mainly shows de-alignment from the mainstream parties, rather than re-alignment to AfD. For that to happen, AfD will have to build a coherent and cohesive parliamentary faction that has few internal struggles and personal scandals. Based on German history, as well as European precedent, that is highly unlikely."

He underlines that "the relationship between AfD and its voters is weak, and is mostly defined by opposition to other parties rather than by support for AfD itself. And beyond its own voters, AfD still seems highly controversial."

https://www.theguardian.com/commentisfree/2017/sep/24/germany-elections-afd-europe-immigration-merkel-radical-right

What should we worry most?  Rise in protest vote?  OR No political outlet addressing their concerns?  Would addressing their concerns necessarily be populism?

This BBC report from eastern Germany, where vote for AfD was particularly high, is consistent with the thesis, which I summarized in a previous post, that support for populist xenophobic parties in Europe is driven by economic insecurity in combination with cultural backlash, a long term trend aggravated by the influx of immigrants and recent economic troubles. 

"Most of those who voted for the nationalist party were manual workers or unemployed," points the report. "More men than women. But there was significant support too from higher earners from the professional classes."

It adds: "The people in this room say they're fearful. Worried about 'Islamisation' and terrorism.They're saddened by what they see as the erosion of traditional family values." 

http://www.bbc.com/news/world-europe-41398628

Talking to a columnist in The Atlantic, Cas Mudde draws attention to the fact that Germany election has shown what seems to be a new structural feature of European politics: the fragmentation of party systems. 

“The discourse after the election is that this is a glitch—that we failed on immigration, so we will adjust and go back to the good old days of the 70s and 80s … but it’s not going back to that,” says this scholar. “These changes are structural and German politics, as with most European countries, are going to be much more fragmented, which means that there will be broader coalitions. If we don’t accept that as the new normal, we’re going to be frustrated by it.” This would be part of an ongoing process of de-alignment from the mainstream parties, at times without clear or consolidated re-alignments. 

He underlines the emergence of a number of small parties other than AfD. Despite not earning as many seats as the AfD, they have reemerged as significant players in a political scene long dominated by the same center-left and center-right parties, points the article titled "How Did German Politics Become So Fragmented?" (The Atlantic, Sep 26).. 

Mudde argues that “at the moment we have this discourse of ‘established parties lose, the right-wing populists win,’ but there are actually three other parties that also have 10 percent—they didn’t win, but they do exist (...) We have never had so many minor parties in the Bundestag and we have never had them at such high levels,””

Sunday’s election witnessed the addition of two new parties to the Bundestag: the AfD, which earned 94 parliamentary seats, and the FDP, which made its return with 80 seats after losing its parliamentary foothold in the last election in 2013 (during which it failed to reach the 5 percent threshold to be included in the Bundestag). These parties now join the Greens (which gained five seats) and the left-wing populist Die Linke (which gained four).

This analyst stay on the surface.  Fragmentation of the votes.  New normal.

THis kind of analysis is there to avoid talking about the central issues the middle class voters that protest votes are sensitive and which the traditional parties are not addressing.  This analysis is right only at the level of : this is not going away.  And this will create a grid lock of politics.  So it will be a statut quo.  The same policies will stay in place.  It will go nowhere like in the US.  The globalists are not going to retreat.  THey cannot move faster ahead.  Gridlock will be OK.  They are there for the long haul.  Then they will say: the problem is the fragmentation, we are not united under our agenda.  There is no other possibility.  Bite the bullet. 

What we are beginning to withness is the beginning of the dissolution of the central concensus maintained during the last decades by the elite class.  There is a growing sense by the middle class, by ordinary peole that they have been betrayed and there is a beginning of questioning of the neo-liberal dogmas.  Yes this will result in the mean time by fragmentation of the political landscapes.  But an opposite force to the mainstream elite consensus is rising, new ideas outside of the mental mindset of neo-liberal dogmas will circulate not through the official media which will focus on putting the blame on peoples for the failure of the elite agenda.

Dear Louis:

I interpret the results in the followingr way (although Il don't know how Mudde sees the future). In my view, this fragmentation could well be a transitory situation before the systems get rearranged. It would be the symptom that the current political configuration is not satisfactory. But the party realignments that would be necessary to address the unsolved problems -especially rising income inequality- will not occur overnight. I wouldn't say however that this process will be something automatic or will occur inexorably. It depends on many factors and circumstances.

Dear José,

I agree.  I think the old utopia is breaking down and now we will have more and more dissidence about it but this will take time.  But I tend to think that we will have to make the media and the intellectual class accountable.  They will have to get serious.  They are supposed to be the one criticizing politics and they don't.  They just feed the media circus.  We will have to address their betrayal.  They are not used to be accused and criticized.  They used to be the one doing it but not in the serious way, just the circus way.  Now we will have to do a lot of cleaning up there first and then the real critic and do a cleaning up of politic.  Remove the money of lobeys from there, get the dam politicians and journalist to do their job for most people, not for the financial plutocracy.  The last time I can remember when politic was put in question was in the 1970's.  At that time the journalists and intellectuals were doing their job.  A new deep questioning is beginning but now it is not only of the politicians, the whole elite class including intellectual and journalist have to be questioned.  

Regards

Dear colleagues:

One of the most commented issues in the press during the last few days has been the evident widespread decline of Social Democracy across Europe, which has been confirmed by the poor performance of the SPD in the German election.

The article in The Guardian that I’ve linked summarizes the trend:

“In Italy, the once mighty Italian Socialist party (PSI) is no more. The Socialist party in France used to be strong enough to heft François Mitterrand and François Hollande into the Elysée Palace. In this year’s presidential race, they captured only 6.4% in the first round. In Scandinavia, the moderate left has taken a beating. Norway is ruled by conservatives and populists. Sweden by the centre-right. The Dutch Labour party (PvdA) has plunged from 19% to less than 6% in five years. A similar fate has befallen Greece’s Pasok. To take in the whole panorama, imagine a map of Europe. Twenty years ago, the map was mainly covered in red, the traditional colour of social democracy. Today, only five countries are inked in red.” Only Britain seems to be an exception in this development.

Interpretations vary, but a common theme is that Social Democratic parties are suffering the consequences of the shrinking of the working class, as manufacturing has lost weight as a share of GDP. According to the cited article, that portion dropped from 35% to 15% in the last 50 years.

Now the classic message of Social-Democrats would fail to attract the support of the middle class. A recent paper authored by Gingrich & Häusermann (“The decline of the working-class vote, the reconfiguration of the welfare support coalition and consequences for the welfare state”, Journal of European Social Policy, 2015, 25(1) 50–75), claims that “the postindustrial welfare support coalition is predominantly anchored in the middle class, which tends to prefer social investment and activation policies over traditional redistributive policies.”

The Bloomberg analysis describes this as “an existential crisis for the center-left”, while the Washington Post also underlines that many of its voters “shifted either to right-wing populist parties or to more outspoken parties on the left”.

https://www.theguardian.com/commentisfree/2017/sep/29/right-social-democracy-dying-europe-afd-far-right-germany

https://www.bloomberg.com/view/articles/2017-09-26/socialist-parties-in-europe-keep-losing-for-the-same-reason

https://www.washingtonpost.com/news/worldviews/wp/2017/09/25/like-germanys-social-democrats-left-wing-parties-are-losing-ground-across-europe/

Dear Foristas. I enclose a very brief analysis related to Latin America and democracy. Best regards