Foreword: November 2016—Patriot games in a global economy

October 13, 2016

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Put out more flags! That’s the mood of the moment. A new preoccupation with borders is palpable from Hungary, where a contrived plebiscite just notched up a 98 per cent vote against the European Union’s refugee quotas, to a rageful presidential election campaign trail in the United States, where Donald Trump’s distinct pitch is that America’s openness to the world is shortchanging its workers and firms. A new nationalism is evident across the British political spectrum too.

Labour’s Liverpool conference was defined by divisions over the leadership, but under the surface was another split, between an unapologetically pro-immigration Jeremy Corbyn, and his MPs, who warn that he has closed his ears to the anxieties of the electors. The progressive intellectual David Marquand, who writes on p34, has decided that the left is doomed to fail if it swims against the political tide of national identity, and that its future lies instead in hitching itself to the benign civic nationalism, found in places like Scotland and Wales.

There was, by contrast, no need to delve beneath the surface of the Conservative get-together in Birmingham to sense the turbo-charged patriotism. Those, including the prime minister, who were recently committed to Britain remaining in the EU were busy forgetting it. In advance of any economic evidence about a Brexit which has not yet occurred, the “Project Fear” script of June was swapped for “Project Not So Bad.” The Brexiteers were giddy to the point of delusion, with Trade Secretary Liam Fox arguing that the UK will somehow be able to trade even more freely with Europe from outside the single market. Theresa May signalled that border control will weigh at least as heavily as economics as she negotiates future relations with Europe. Her Defence Secretary announced that human rights law should no longer constrain British soldiers fighting overseas. And her Home Secretary—not long ago a liberal Remainer—proposed forcing employers to publish lists of lawfully resident foreign staff, as if they were something to be embarrassed about.

Most fatefully, the PM committed to formalise the Brexit process by March, while also—as Jolyon Maugham explains on p7—asking MPs to repeal the European Communities Act now, before they can have any idea of what she will negotiate to put in its place. It is an irresponsible request, and like much of the new nationalism, one which looks weird, when economies remain so interconnected. Barry Eichengreen’s authoritative stocktake on globalisation (p44) concludes that—while integration is no longer accelerating, as in the 1990s—there is no sign of it unravelling, as it did in the 1930s. The upshot? If politics pushes people and businesses back behind borders, then that is going to be mightily disruptive: there will be less prosperity to share around.

But the reason, of course, why the politics have reached this point is that the prosperity was never properly shared. The resulting despair in Brexit Britain, and the hurting “hillbilly” communities that Diane Roberts describes on p28 are now creating a serious headache for the world’s have-a-lots. Their headache won’t clear until they address the plight of the have-nots.ftoo