Times have changed—and with them societies and political philosophies. In the last thirty years, the world has gone from bipolar, to unipolar to multipolar. It has gone from liberal to progressively illiberal. What are these changes, their consequences, and what is the new world order?
Following two catastrophic world wars, humanity learned something: Liberalism prevents wars. Liberalism improves trade. Liberalism is good. So in 1945 the United Nations (UN), a framework for multilateralism to protect world peace and human rights, was created. That same year prominent economist John Maynard Keynes helped create the International Monetary Fund (IMF), another piece of multilateralism encouraging economic development, at the Bretton Woods conference. And in 1949 NATO, an intergovernmental military alliance was formed to safeguard a rebuilding, democratic Europe from the authoritarianism of the USSR. Things were looking good.
Skip a couple of decades and it’s the 80s and 90s. Liberalism, especially economic liberalism, is in full swing. Ronald Reagan and Bill Clinton in the USA with Margaret Thatcher in the UK set about trust-busting and encouraging trade, strengthening the European single market and establishing the precursors of the WTO. Globalization—low barriers to international trade and investment—becomes standard economic policy. Millions of jobs are created, especially in developing countries, and the prices of goods plummet. Some 1.2bn people are lifted out of poverty. Then in 1991 the bastion of illiberalism and despotism in eyes of the West, the USSR, collapses. The world becomes unipolar, with the United States as the sole global superpower—charged with permeating liberal values and conserving world peace.
Today, however, the liberal world order fades. Start with foreign policy. Following the 2001 9/11 attacks, the United States rejects multilateralism for unilateralism, culminating in its second invasion of Iraq in 2003 without UN authorization—a war deemed illegal by most of the international community. The contrast between the 2000s and before is clear: in 2003 the US invaded illegally and with just one ally, the UK; in 1991 it invaded with UN approval, a coalition of other nations and in order to counter Sadam Hussein’s violation of Kuwait’s territorial integrity, not solely for national reasons.
There is a brief return to multilateralism under the Obama administration but it is not the same as before: the US is not the sole world superpower; it must contend with rising China, the EU and the rest of the BRICS (Brazil, Russia, India, China, South Africa). And after winning the presidential election in 2016, Donald Trump inculcates unilateralism as the dominant US foreign policy. His aggressive foreign policy against Iran—where he reneged on the Nuclear Deal the nations signed during Obama’s presidency—and his skepticism of NATO and the WTO are proof of his unilateral attitude.
Economically the liberal world order weakens as well. By 2010 globalization’s run as the dominant economic policy is over; the “golden age of globalization” comes to an end. The world is rocked by the financial crisis in 2008, causing a large loss of faith in the US and its financial system—the underpinning of the post-war liberal economic order. While before the dollar was unquestionably considered the “world currency”—the currency all countries use for commerce—its position today is scrutinized. The end of globalization translates into the rise of protectionism—economic policy based on high import tariffs—and growing resentment for economic migration as well as cross-border investment. The ongoing trade war with China and withdrawals from economic unions, such as Brexit, are a testament to this new thinking.
Politics are also heavily impacted by changing global thinking. Centrist, liberal parties are losing ground to growing populism and radicalism. In this year’s European election, parties considered on the “fringe” of the political spectrum, such as the environmentalist Greens on the left and populist, nationalist parties on the right, gained the most votes. Europe suffers a wave of euro-skepticism—hatred and suspicion of the EU’s social and economic liberalism—shown through these last elections, Brexit and the presence of a plethora of populist, nationalist leaders all over the continent (e.g. in Italy, Hungary, Poland…). South America also grapples with populism with the rise of Mr. Obrador as president of Mexico on the left and the election of Jair Bolsonaro on the right in Brazil. Even establishment parties, such as the Republicans in the USA and the Conservatives in the UK, embraced populist candidates and policies: Republicans nominated Donald Trump, a political outsider, and the Conservative Party embraced Brexit.
The new world order is a dangerous one. Multilateralism is vital for world peace. Unilateralism, on the other hand, engenders wars over national priorities. Globalization saved millions from poverty and is the reason why the West, particularly America, is so economically vibrant. It also helped close the gap between rich and less developed countries: rich ones invested more into poorer country markets, and migrants in rich countries from said poor countries sent money back home. Its nemesis, protectionism, destroys jobs through increasing the cost of intermediate products: one estimate, by Trade Partnership Worldwide, a think-tank, reckons Trump’s tariffs on Chinese steel and aluminum create 26,000 American jobs but cause a loss of around 400,000. Not to mention consumer variety weakens and prices inflate. Populism causes political instability and often correlates with nationalism—the cause of the two largest conflicts in world history, the World Wars. Demagogues are also more likely to fear-monger, leading to increased ethnic violence (witness the El Paso shooting in America) and locking-up of opposition deemed “evil” (Erdogan’s Turkey jailed 122 journalists in 2018 alone). They also reject globalization in favor of protectionism (e.g. Donald Trump’s trade war), bringing heaps of trouble.
The new world order is terrible. But that does not mean the previous one was perfect. Globalization spread trade and commerce across the world, but certain industries suffered terribly. The most famous example in the US is the car industry, where Detroit’s manufacturing empire was reduced to a ghost town. Countries must provide aid to workers needing to shift industries in order to remain in the workforce. Nordic countries do just that, and Singapore provides courses to older workers who struggle to adapt to a new work environment (one with increasing exposure to technology, for example). Emulating these policies is a good place to start.
Countries should also show that multilateralism is still worthwhile. Instead of the UN and other global organizations sitting idly as war tears Yemen and Syria to shreds, force them to act. Instead of twiddling their thumbs they should convince Venezuela’s neighbors that it is worth working together to beat the uncooperative and tyrannical regime. They should do the same for North Korea. Organize coalitions. Engage the peace corps. Demonstrate that multilateralism is not merely restricted to theory; it keeps peace in practice, too.
When it comes to political parties, liberal, centrist politicians must understand that relying solely on the upper to higher classes does not win elections; they need the poor and the middle class behind them, too. They need to show lower-class voters that populism just grows their ills and that liberalism and ensuing free trade and immigration improve their lives. Liberals should also freshen up their image, and debunk the elitism and corporatism their critics assign to them. A start would be to invest more in public education. Another good policy would be to regulate some health-related industries more tightly, especially in America where there is a lack of regulatory oversight concerning the pharmaceutical industry. And liberals should reform tax laws by fixing loopholes that benefit the already rich, such as the US’s mortgage-interest deduction. These policies show that liberal governments care for corporations and the well-off but also for their average citizens. Fighting the toxicity of populism won’t be easy, but it is a fight worth winning.
The new world order is not the liberal one of before. Liberal democracy and all it stands for—free trade, immigration, and multilateralism—is in retreat as growing populism and radicalism in both left and right-wing circles eat away at its dominance. We will have to wait and see how this new order will tackle rising issues. One thing is certain, though: it won’t be pretty.