The Wave to Come
Ian Bremmer
May 11, 2017
When the storm turns out to be less severe
than the warnings, there's always a sigh of relief--and maybe a bit of
over-confidence after the fact. If fans of the European Union felt better after
populist Geert Wilders came up short in the Dutch elections in March, they also
took heart from the absence of anti-E.U. firebrands among the leading
contenders for this fall's German elections. Then came May 7. The victory of
Emmanuel Macron over Marine Le Pen in France's presidential elections signaled
that "the season of growth of populism has ended," Antonio Tajani, president of the European Parliament, said on May
8.
Not so fast. Europeans will soon remember that elections are never the end of anything--they're a beginning. And whether the issue is unelected Eurocrats' forcing voters to abide by rules they don't like or fears that borders are insecure, there are good reasons to doubt that the anti-E.U. fever has broken. France's Macron now faces powerful opposition on both the far right and the far left. Hungary and Poland are becoming increasingly illiberal. Brexit negotiations are getting ugly. And resentment toward the E.U. is still rising throughout Europe.
In the U.S., President Donald Trump may be pushing what increasingly resembles a traditional Republican agenda, but polls show that his supporters are still eager for deeper disruption. Trump's embrace of Turkey's Recep Tayyip Erdogan, Egypt's Abdul Fattah al-Sisi and the Philippines' Rodrigo Duterte suggests a lasting affinity with aggressive strongmen. His chief adviser and nationalist muse, Stephen Bannon, may be under fire, but he's still there. The Trump presidency has only just begun.
In short, nationalism is alive and well,
partly because the problems that provoked it are still with us. Growing numbers
of people in the world's wealthiest countries still fear that globalization
serves only elites who care nothing about nations and borders. Moderate politicians
still offer few effective solutions.
Now here's the really bad news: an even
larger crisis is coming. The popular fury convulsing Europe and the U.S. may
well spill over into the rest of the world. Just as the financial crisis, which
began in the West, produced rumbling aftershocks around the globe, so the
nationalist explosion will rattle the politics of countries on every continent.
Leaders in China, India, Brazil and others will face unprecedented challenges
in managing this threat.
The emergence of a truly global middle
class is one of history's great success stories: more than a billion people
have been lifted out of poverty, literacy rates have surged, and access to
education and health care is now widespread. But this vast rising tide did not
lift all boats, and those left behind are not happy. The headlines have all
been about reaction in the West, where globalized trade has hit manufacturing
and technological changes have transformed the workplace. Jobs are being
eliminated, and the world's original middle classes are shrinking. The native-born
resent immigrants seeking work, and in Europe, the debt crisis plunged some
countries into austerity and others into stagnation just as the surge of Middle
Eastern refugees fed fears of crime, terrorism and loss of national identity.
Now some of the same storms are making
landfall in the developing world, where governments and institutions are far
less equipped to handle the stress. We've already seen the first chapter of
this narrative with the quakes that have rocked the Arab world over the past
seven years. Along with a crisis of governance, inequality and connectivity
have played leading roles in these dramas as citizens become both better aware
of how far they're falling behind and more able to organize protests about it.
The Gini coefficient, a statistical measure
of income inequality within countries, finds that the gap between rich and poor
is moderately high in places like Russia, Turkey and Indonesia, and yawning in
China, Brazil, Mexico and Saudi Arabia. As lower-income citizens in these
countries become more aware of what they're missing--decent housing, education,
work opportunities, health care and protection from crime, in particular--the
risk of unrest will rise. We've already seen previews of this in Brazil and
Turkey, where millions of angry people have filled city streets to protest
corruption, abuse of power and lousy public services in recent years. What
happens when technological change in the workplace guts the new middle classes
in developing countries like China and India, where government is held more
directly accountable for the creation of jobs? What about Iran and Saudi
Arabia, countries with fast-expanding populations of young people with fewer
jobs created? In the Middle East, over 40% of the population is under 25. Can
economies there create enough jobs to sustain them? For hundreds of millions of
people across the developing world, a slide back into poverty is a fear that's
easy to visualize.
Then there is the question of identity
politics. Globalization doesn't move just goods and services. It moves people,
feeding public anxiety by shifting the racial, ethnic, linguistic and religious
makeup of communities, sometimes abruptly. Trump rose to power in part by
leveraging fears about immigrants' stealing American jobs. Immigration was also
at the heart of the Brexit vote. Developing countries don't have to worry about
waves of migrants knocking at the door in search of a better life, at least not
yet. But in many of these countries, "they" are already inside or
live just next door. Even in countries with unchallenged boundaries, racial,
ethnic, tribal, religious and linguistic differences can become fault lines
when technological change creates economic turmoil. Political opportunism is
universal.
In the West, nationalist politicians have
seized the opportunity created by popular anger to boost their influence. But
the structures that create stability in the West have proved to be resilient.
Trump is still discovering the meaning of checks and balances. And majority rule
kept Le Pen and Wilders out of power.
What happens in countries where these
institutions are weaker and have less popular legitimacy? Expect similar
figures to emerge--but with results that are even harder to predict.
Nationalists rise to power by convincing citizens that they can defend
"the people" against a predatory elite and the favored groups they
protect. But the hated "them" isn't always a domestic enemy or
someone still hoping to come inside. If the leaders of Turkey, Iran, Saudi
Arabia, Egypt, Russia and China can't help their citizens compete in a 21st
century globalized economy, where might they look for culprits? In the past,
governments have steered public anger toward other countries, which can easily
turn into military conflagrations.
Others will respond to nationalist
pressures by building walls. Some of these barriers will be between the state
and their subjects--China's government has taken steps to create a
"social-credit system," a sort of credit rating based on economic and
social behavior that determines the opportunities available to a person.
Beijing claims the plan is intended to create a harmonious society and a
"culture of sincerity," but it might also serve as a barrier between
the ruling party and angry citizens. In India, the government has gathered
biometric information on more than 900 million of its citizens for its
controversial national identity-card program. There's no telling how future
governments will decide to use this great trove of data; the potential for
surveillance is enormous.
Information, if tightly controlled, can
divide. The Russian state dominates the television channels and websites from
which the vast majority of citizens get their news. Since last July's failed
coup, Turkey's Erdogan has used a state of emergency in his country to tighten
media controls and punish outlets critical of his government. Then there's the
assault on information itself. The fake news that appeared on the Internet
during the U.S. presidential election has long been standard fare in less open
societies.
These kinds of barriers may be the future in a world that was until recently described as increasingly borderless. People will gravitate toward online enclaves of information and ideas, creating virtual walls between left and right, urban and rural, different ethnic and religious groups, the religious and the nonreligious. Between "us" and "them."
How can we bridge the gap? Some governments
are experimenting with solutions. Finland is addressing the changing workplace
with a concept called guaranteed basic income. As part of a trial, it is
sending monthly tax-free payments of about $600 to 2,000 unemployed citizens
chosen at random. The recipients will continue to receive the payments even if
they find work. The assumption behind the project is that future work is far
more likely to be part time or self-employment--and that the unemployed are
reluctant to take these sorts of jobs if they lose welfare benefits as a
result. The opportunity to make more money in part-time jobs, it is hoped, will
attract people receiving the guaranteed basic income, and their spending power
will stimulate growth. Welfare bureaucracies will be cut, because there will be
no need to maintain complicated databases to track the continuing eligibility
of participants.
Local governments in Canada, the
Netherlands, Scotland and Oakland, Calif., are reportedly planning to
experiment with this idea. (The Swiss voted last year to reject it.) If the
guaranteed-income idea seems antithetical to an American work-ethic-driven
culture, consider that President Richard Nixon proposed a modest version of the
basic income idea in the late 1960s. Other ideas are also out there. In
Singapore, for example, government has created "individual learning
accounts" to provide every citizen over 25 with money to spend on educational
training.
There will be many more such experiments as
governments search for ways to rewrite the social contract to ease inequality.
But the effort demands capable governance and the resources to construct and
sustain the transition to a new world. Where those do not exist, solutions are
much harder to come by--and darker alternatives beckon: to increase control, to
suppress instead of liberate and to lash out at reliable enemies.
Dealing with the forces that drive populism is no easier than dealing with the forces that drive climate change, and they are all too easy for political leaders to avoid. But ignoring either trend will produce an overheated world and rising tides. That's why, no matter what headlines you may read this spring about the triumph of globalists over nationalists, the truth is that we're all in this together.