Around the world and back again

John Ralston Saul has produced—over the last decade and a half—some of the most interesting, thought-provoking and accessible critiques of our contemporary social and political climate. In The Collapse of Globalism—which examines the rise and fall of global economic ideology—he has added to this impressive body of work.

Saul’s past work includes the now famous philosophical trilogy Voltaire’s Bastards, The Doubter’s Companion and The Unconscious Civilization, which looks broadly at the West over the last few hundred years, since the inception of modern democracy; his more focused study on his native Canada, Reflections of a Siamese Twin (which has as yet no comparable study in Australia); and his timely re-evaluation of humanism, On Equilibrium.

For those who have been following Saul’s work so far, this latest offering may on first reading seem to be covering old ground. His theme of the collapse of globalisation was floated in Australia in lectures presented in January and August of 1999 (both broadcast on the ABC). It was then put forward in an article he wrote for Harper’s Magazine in the United States—‘The Collapse of Globalism: And the Rebirth of Nationalism’—in March 2004, and reprinted here in the Australian Financial Review. This formed the groundwork for his latest book, developed around themes already examined in his previous works.

On closer inspection, far from simply repeating himself, Saul has provided a fresh and compelling perspective on the debates surrounding globalisation. But most importantly, he has brought to the foreground much that has been left out of these ongoing debates, and the reality that has been masked by them. In doing so he has reworked his previous themes—such as the centrality of citizenship and democracy—in order to demonstrate their continued relevance, and to add yet another level of depth to his previous analyses.

For those who have not been following Saul’s works, or who are trying to decide the best point of entry into them, The Collapse of Globalism will not disappoint. In it he examines the ideology of globalism—which looks at the world through the prism of a certain theory of economics—and shows that, as with all ideologies, and especially economic ones, they have beginnings, middles and ends. Usually the end creates a political vacuum that needs to be filled by something, and this then plants the seeds for the next big ideology. Globalism, for example, grew out of the vacuum left by the end of Keynesianism in the late 1960s and early 1970s. But this transfer from one ideology to the next is not inevitable. The vacuum also provides an opportunity.

The three main parts of this book examine the rise (from the early 1970s), the plateau (in the 1980s) and the beginning of the collapse of globalism (in the mid-1990s). Then, in the final part, Saul shows what is happening in the confusing transition period in which we currently live. Some still hold true to the old economic faith, however. This argues that there are no more borders, that the nation state has been usurped, and that we are all moving towards being equal on the global stage. For others it has become increasingly obvious that the nation state has actually staged something of a revival; that nationalism, in both negative and positive forms, has returned; that borders are real and are meaningful, whether they be used for good or for bad; and that we are not all equal in the world, that there is in fact an increasing amount of inequality that has been produced largely by the failure of globalism to live up to its own hype.

Saul draws on examples from many countries to support his case. He looks at the arc of their development from being nation states or colonies in the 1970s, through to projecting the image of being global economies in the 1980s, and into their more recent return or birth as nation states, with a few ‘globalist’ hangovers. This includes detailed discussions of New Zealand, Malaysia, India and China, and the variations of globalism, and now nationalism, in each.

Although Australia is mentioned a few times, no systematic account of the story of our own global experiment is present in this book. But that’s not a problem. If anything, reading the book from an Australian perspective adds an independent variable against which the argument the book presents can be better assessed. Even a brief look at Australia over this same period shows how remarkably Saul’s analysis fits the pattern of our own recent history.

Sara Dowse, in a recent essay in Meanjin, gives a date to what could very well be the start of globalism in Australia: April 1975, when Milton Friedman visited, preaching what was then known as monetarism. The effects were immediate, Dowse says, with Treasurer Bill Hayden putting this into practice the following year, partly to cut government spending and to redress Whitlam’s overindulgences the previous year, but partly to prepare the ground for a future strategy that would put the economy at the heart of government, and make social policy subordinate to this.

This fits in with the group of events that Saul argues began in the early 1970s and laid the groundwork for globalism. Friedman, of course, won the Nobel Prize for Economics in 1976, which cemented his authority as an economic guru. Saul sees his logic, however, as being ‘unnecessarily decisive, pure Manicheism’. Later he shows how Margaret Thatcher justified this decisiveness by arguing that ‘there is no alternative’.

 Of course, by the time Thatcherism was being played out in Britain, and Reaganomics was taking hold in the United States, we had a succession of Hawke-Keating governments, backed by a partisan Liberal opposition, which set about restructuring our economy along such globalist lines. Except that here we called it economic rationalism. And by the mid-to-late-1980s, globalisation was in full swing.

Perhaps Keating’s failure as prime minister to implement his raft of social policies can be partly explained by their being overshadowed by the momentum of his previous economic policies, as these were going in two separate directions. His social policies had a national focus—indigenous affairs, the republic, our geographic closeness to south-east Asia—while his economic policies were based on the implicit assumption that such things no longer matter. Our attention was then redirected to the even bigger picture, away from such nationalist causes.

Saul marks 1995 as globalism’s ‘cusp year’. It was a year of triumph, with the creation of the World Trade Organisation. But it was also the beginning of its collapse. Saul gives some examples: the tequila crisis in Mexico, which saw the complete failure of globalism to produce the promised new Latin America; and James Wolfensohn, and later Maurice Strong, starting at the World Bank, beginning the decade-long battle with its bureaucracy to restructure it to meet the reality of the non-Western world.

Then 1996 saw the revival of nationalism, rising out of the cracks that had started to show in globalism. This was the year that the Chechnyan-Russian conflict escalated; that religious-based nationalist political parties flourished in Israel, India and Turkey; that the Taliban seized power in Afghanistan. Scotland created its own national parliament. IRA bombings increased in Northern Ireland, as did terrorist bombings in Sri Lanka and the Sudan, all in the name of nationalism. And in Australia, we had
Pauline Hanson and the electoral victory of John Howard.

Perhaps Howard’s prime ministership can also be elucidated partly in terms of the context of this collapse of globalism. It seems to contain the same inherent contradiction that Keating’s government had, but now flipped the other way. On the one hand, carried along by the momentum of a crumbling global economic structure, there are the usual ideological articles of faith being played out: the sin of public debt, so government budget surpluses are seen as desirable (while private debt soars and public services falter); the last hurrah for privatisation and the selling off of Telstra; and the introduction of a restructured industrial-relations package. On the other hand, in spite of globalism, or perhaps because of its imminent collapse, there has been a sharp withdrawal back into our nation state: the closing of our borders and cruel and unusual treatment of asylum seekers; elections won on grounds of introducing a new tax (GST) or managing the economy on a national level (can they really control interest rates?); as well as various overseas military actions, designed to protect ‘our way of life’. East Timor is an instructive example: we went there to liberate them from Indonesia, to give them national self-determination, and to secure their oil reserves for our own national interests. In a global paradise, both actions would have been superfluous. Other military actions, however, following the US, have been waged unilaterally; that is, nationally, outside of any international or global system.

The final section of Saul’s book discusses this return of the pre-eminence of the nation state. It is here that Saul’s analysis brings us back, with urgency, to his previous work. The nation state is the site of modern democracy. Democracy is built upon the legitimacy of an active citizenry. When the citizenry is passive or being made passive by the promotion of inevitable forces outside their control—first globalism, and now terrorism—then democracy is weakened. The nation state, then, becomes the site for negative nationalism.
According to Saul, we are in a period of transition. The future is open. The direction we take is dependent upon how we citizens reactivate our legitimacy, strengthen our democracies, and reclaim our nation states.

The Collapse of Globalism: And the Reinvention of the World, John Ralston Saul. Penguin Viking, 2005. ISBN 0 670 04267 6, RRP $32.95

Matthew Lamb lives and writes in Brisbane.


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