I am so at home in Dublin, more than any other city, that I feel it has always been familiar to me. It took me years to see through its soft charm to its bitter prickly kernel - which I quite like too.

GLOBAL GOVERNANCE

The Case for the State

Chris O’Malley

The largely successful growth of the world economy since 1945, which has seen hundreds of millions of people lifted out of poverty and continuing scientific and technological development, has been based on a system of multilateral global governance developed in the aftermath of World War II. That system of governance, which has been taken for granted for sixty years, is now under direct threat from the second Trump presidency and the consequences of unravelling it may bring a halt to developments that have been under way for much longer than that.

The emergence of strong states in Europe with definitive authority in their own territories took place just over three hundred years ago. This was the game changer that enabled a long wave of scientific, technological, economic and social progress – originally in Europe but spreading elsewhere since then. Even if much of what has developed also had distinctly negative consequences, especially in other parts of the world, only a minority would argue that humanity was better off overall before. Before the rise of strong states was an era dominated by mercenary armies, an era where there had been long periods of semi-anarchy, disjointed but devastating warfare and two major waves of catastrophic population loss.

The strong states that saw Europe through the eighteenth and nineteenth centuries were in the twentieth century confronted by pressures of globalisation on a new level. After the crises of two world wars and economic collapse, the response was to put in place a more collective system of global governance. That system has been based on a range of institutions, including the United Nations and its various arms, the World Trade Organisation, the OECD, and military alliances such as NATO which – while not universal, has served to add stability to the global system. What all have in common is that they provide frameworks for national governments to collaborate on common issues on a structured, institutional basis.

This system of global governance has never been perfect, but it did enable continued growth and social progress and allowed national governments to remain largely in control thanks to the systems of collaboration put in place between them. No one knows what impact unravelling these multilateral institutions would have on the coherence of national governments in their absence. Experience of war and economic depression before they were put in place, combined with awareness of how even more integrated the world economy has become since then, should not encourage us to be complacent about it.

The combined challenge of continuing economic inequality and a nationalist backlash against it which could remove the very instruments needed to correct inequality is a dangerous cocktail whose consequences could be far deeper than simply the start of a new thirty-year political cycle. The year 1990 saw what looked at the time like the end of the Cold War, with the collapse of the Soviet Union and the Warsaw Pact. On the face of it, an ideology based on free market liberalism had now seen off all challenges and was finally truly globally dominant, having seen off both Nazism and communism over the previous half-century.

It was this perspective that had led Francis Fukuyama to publish The End of History in 1992. His conclusion was that this was the end of the last major ideological struggle in history. There might still be competition and conflict over resources in the future, but no longer would there be fundamentally competing views on how to run the world. However, the question was whether the story of this challenge was in fact yet over.

A previous ideological struggle was that based on the challenge to monarchy mounted by the French Revolution. Had we ended that story with the defeat of Napoleon in 1815, we might similarly have been tempted to conclude that the challenges represented by republicanism and nationalism had failed. During the following decades, when new technologies such as steam-driven factories, and then trains and telegraphs, were driving progress, monarchy could once more be seen as representing the future. In fact by just over a century later, in the aftermath of World War 1, monarchy had been banished to the margins of government in Europe. Judging the outcome of the ideological struggle with monarchy from the standpoint of the aftermath of Waterloo would therefore have been very misleading.

After the defeat of the French Revolution, there had been a general backlash, not only against the extremes of the revolutionary Jacobins and Napoleon Bonaparte, but against Enlightenment thought more generally. Religion and medievalism became fashionable in the immediate aftermath. In similar fashion, after the defeat of the Soviet system in 1990, there was a general reaction, not just against communism, but also against social democracy. Free markets, seen as having originally been embodied in their purest form by Victorian Britain, were now seen with even greater emphasis as the model for social and economic organisation of the future. The conclusion drawn by most commentators and policy-makers around the world was that, with the fall of the Soviet system in 1989-90, market-led economies had proved their superiority to state-led economic management.

Hungarian investor and philanthropist George Soros coined the term ‘market fundamentalism’ to characterise the new zeal for free markets which was becoming increasingly influential, above all in the US but also in Europe. Market fundamentalists tend to the belief that the operation of markets is so superior to anything that governments might orchestrate that any outcome they produce must be the better one. While few would explicitly argue that markets are a force of nature rather than social institutions that need managing, the instinct to regard them as consistently self-rectifying increasingly became the default position of official economic orthodoxy.

Parties such as Labour in Britain and the Democrats in the US largely abandoned previous efforts to reduce economic inequality, and instead put their greatest emphasis on tackling discrimination based on gender, ethnicity, disability and other stated grounds, and to some extent on improving public services. They turned away from the issue of economic equality during a period when all measures of economic inequality had shown a marked rise since the early 1980s, as a result of the course then set by Reagan and Thatcher – most of all in the US and Britain. The underlying reason for giving up on economic inequality was the international mobility of wealth and the increasing competition to attract it by taxing it less. The more globally integrated economies became, the more reluctant governments became to increase tax on wealth and corporate profits.

While other European governments did not seek to dismantle social protections to the same degree, and largely maintained less unequal societies, they also lost their enthusiasm for attempting any major new measures on this front.  One risk that this new approach towards promoting equality ran was that it could, and ultimately did in many cases, set people who were economically marginalised against the people suffering from discrimination under the categories now approved such as gender, ethnicity and disability.

In Russia, the fall of the Soviet regime presented an opportunity to give full play to a radical new model of free market organisation that went further than anywhere in the West. The new regime, led by Boris Yeltsin, embraced advice from Western economists who were champions of an ideology that rejected the ‘social market’ compromise that had emerged since World War II in the rest of Europe. Russia had a society and economy that had been highly structured and protected to this point, and as a result the new course involved a shock therapy for which the country was far from prepared.

In the largest disposal of state assets in history, by 1994 70 per cent of larger Russian companies and 90 per cent of smaller ones had been sold off. This development left the government in a much weaker position to restrain corruption or to steer the economy’s future direction. It put in place a radically reduced system of social protection that offered a small fraction of subsistence income to the families of unemployed workers. This was in a society that in the 1990s experienced both a halving of its GDP and almost a doubling of the level of measured inequality, as previously protected industries were exposed to global competition. The Russian state under President Vladimir Putin did over the following decade reassert itself against the emerging semi-anarchy, when he called on the power of its police and intelligence services to bring the new business oligarchs under control. This was, however, now a state that was no longer committed to freedom of speech, political association or the rule of law. For  the majority, the initial enthusiasm for democracy following the fall of the Soviet system had by now well and truly dissipated.

While the phenomenon was particularly pronounced in Russia, the pattern of a small number of hyper-wealthy people coming to the fore in conditions where the state’s role is shrinking could also be seen across the Western world. From the turn of the millennium, the US for the first time saw a majority of people in the workforce no longer expecting to be better off than their parents, with most households having to earn two incomes in order to maintain living standards and this pattern has appeared, albeit to a somewhat lesser extent, in Europe since. This was happening even as the economy overall continued to grow, as the proportion of wealth remaining in the hands of the wealthiest 1 per cent continued to grow. Weakening of employment regulations and of pension provision for company employees had made larger parts of society, including even professionals, more economically insecure and vulnerable. Government intervention to provide housing and welfare support was often scaled back under the pressure of intensifying global competition to attract trade and investment.

The unwillingness of the parties of the welfare state and the New Deal to confront the alarming rise in the share of wealth owned by the top 1 per cent has left a dangerous vacuum however. Growth in inequality has left large sections of society increasingly insecure, marginalised and disillusioned. The internet has since become a daily reality for the majority of people in advanced economies. While this was initially a revolution in communications technology, paradoxically its immediate impact has been to actually weaken or threaten the position of organisations in modern society that rely on the command of intellectual or persuasive power. Media organisations find they can no longer offer secure, well-paid careers to journalists as increasing numbers of people look to social media for their news and become sceptical of all sources of news. Also wielding intellectual power are political parties, which traditionally provided participative structures through which people from across the community could become actively involved in politics and communicate with their leaders. In more recent decades, the role of party structures has declined markedly and communication through both the internet and other mass media has played a much more critical role in influencing the outcome of elections.

The internet emerged during a period when an ideology that favoured minimum government was dominant. As a result, it – and especially the new social media channels that developed through it – were largely left to develop in an unregulated environment. While there were many positive impacts of the new media in connecting people, there has also been widespread extreme fabrication of truth and virulent animosity on a level not common in more traditional media. The full impact of this on the cohesion of society has yet to be fully seen.

The extent to which neoliberal market doctrine was victorious had a direct relationship to the size of the crash that ended the long boom which had extended since 1990. In September 2008, a major global institutional finance house, Lehman Brothers, went bankrupt, following a year-long period of nervousness and restrictions on lending between banks. Given that no one could calculate the knock-on effects of this, with the extent of recycling of assets and debts throughout the financial system, the result was to set off a panic. Stock markets across the world suffered collapse early the next month, on a scale not seen since the Wall Street Crash of 1929. The severity of the ensuing slump was in effect the outcome of a collective decision by governments over previous decades not to try any longer to collectively manage or moderate the impact of economic cycles, even when growing asset bubbles – especially in property in this case – were increasingly evident. Recent lessons on this front had already been available, not least in Japan, whose economy had been slowed down for over a decade as a result of a massive property bubble bursting in the 1990s.

In a major departure from international practice, recently arrived British prime minister Gordon Brown, responded to the crisis by persuading fellow government leaders to collaborate in a major collective effort to prevent the global economy from going into free-fall by together investing in the financial system and keeping major banks alive. This was a major achievement at the time and was not easily done. However, this collective action focused only on protecting financial institutions from collapse and did not seek to address the massive downturn in economic activity which followed. Instead of thinking in terms of collectively managing economic cycles, focus was placed on balanced budgets and avoiding borrowing as the answer to preventing another crash in the future. Germany even changed its constitution to prevent governments from borrowing. This did not address the real problem, which had been excessive private lending and borrowing.

US President Obama did move to increase the circulation of money in the economy following the 2008 crash, on a much greater scale than was pursued in Europe at that stage. Under the leadership of Mario Draghi, the European Central Bank did finally follow a policy of reflation, beginning seven years after the crash, which had a positive impact on helping growth to return to the economy after years where the euro currency faced a prolonged crisis and the threat of national bankruptcy in three member states. Overall, the relatively hands-off, unco-ordinated response of world governments to the aftermath of the crash – beyond initially saving the financial system – meant that the global economy took the best part of a decade to recover from it. The impact, in terms of the disillusionment and alienation of a large part of the electorates in the developed world, would last for longer than that.

There followed a worldwide rise in political movements characterised by authoritarian nationalism, whether the takeover of the US Republican Party by Donald Trump, that of the British Conservative Party by Boris Johnson and his allies, or the rise to power of hard right governments in Poland, Hungary and other countries. This phenomenon has been seen mainly as a backlash against the rapid growth in globalisation since the Second World War. Since 1990, when the economic dominance of multinationals was already long established, the growth in volume of annual international investment was more than double the growth in global GDP, indicating how much the pattern had further intensified. It was also in practice a backlash against the Third Way politics of parties such as Labour, social democrats in Europe and the Democrats in the US, who had reduced their traditional visibility as champions for the economically marginalised. The ironic, and to a great extent unanticipated, outcome of this is that most of those who felt marginalised and excluded turned during this period not to parties of the left (although there were exceptions in countries such as Greece and Spain), but mainly to parties of the right, such as the British Conservatives and US Republicans. Their new nationalism was of a relatively extreme form, which was no longer so strongly married to free market orthodoxy and which was sceptical of, and even hostile to, causes such as equality or civil rights. Some Conservative ministers in the UK denounced the European Court of Human Rights as being out of line with British values, even though the UK had been the leader in getting it established in the first place and it had been seen as very much in line with British values immediately after World War II.

As had already happened in Russia with the rise of Vladimir Putin, a series of major countries around the world came under the sway of hard-line nationalist leaders with dictatorial tendencies, including ones which were still democratic regimes with elections. These countries included, at differing times, Turkey, Brazil, India, Poland, Hungary and the Philippines. Even in China, which did not have a democratic system to begin with, President Xi Jin Ping established the most authoritarian regime since Mao Zedong, but this time underpinned more strongly by nationalist ideology. Given that China had by now become the second largest economy in the world and was vying with the US for global leadership, his more absolutist leadership style cast a long shadow over the world.

Ultimately, this worldwide rise of authoritarian nationalism was the outcome of a period of intense market neoliberalism and globalisation, culminating in economic collapse. The new wave of nationalist leaders have for the most part continued to believe in free markets, but the element of free market ideology that they have taken aim at specifically has been global integration – the free movement of people and investment across borders. In doing so they gained immediate support from many people who had once had secure, well-paid employment in sectors like manufacturing that had migrated to lower cost economies. They also gained support from people who saw immigrants willing to work for lower pay as threats to their own living standards. When new member states joined the EU in 2004, the UK stood apart from most of the existing member states in allowing entry to the UK for workers from Eastern Europe from the beginning, instead of implementing a transition period. The motivation for this was clearly to dampen overall wage levels in order to strengthen the UK economy’s competitiveness. This would have a direct impact on what happened next. Under the leadership of Boris Johnson and others, Britain voted in a 2016 referendum to pull Britain out of the EU. The view that immigration had become excessive was the single biggest factor that swung the vote, narrow as the result was. This move was a major blow to the multilateral framework of international governance that had been developing since 1945.

An even greater threat to this structure, on a broader front, came from the election of Donald Trump later that year. President Trump developed US isolationism to the furthest extent it had been since the 1930s. He withdrew the US from the Paris Agreement on combating climate change agreed the previous year and did so again on the day of his second inauguration. While he did not withdraw from the World Trade Organisation, he imposed new tariffs on other economies on a level and through a process that effectively ignored its rules. While he did not withdraw from NATO, he made veiled threats to so, in a manner unheard of from a US president before, leaving other countries uncertain as to whether the US could be relied upon to defend its allies. He also withdrew from the World Health Organisation during a period of global pandemic, and withdrawing the US from the WHO again was also among the moves he announced on the first day in office of his second term. There is now every prospect that these moves to withdraw the US from a multilateral system of global governance will go further. His early announcement of intent to levy tariffs on both Canada and Mexico, effectively dismantling the free trade area in place on the North American continent since the 1990s, is just one more sign of this.

The irony of seeing marginalised people throw their support behind people like Donald Trump and Boris Johnson is that in reality, if the growing level of inequality is actually to be rolled back, it will require global collaboration to make the wealthiest individuals and corporations contribute a larger share of taxation. Without such collaboration, all governments are constrained by fear that if they raise tax rates on their own, wealth and economic activity will simply move elsewhere. The Global Agreement on Corporate Taxation, mediated by the OECD in 2021with President Biden’s active support, provides the first pointer to how this can be done in practice and may in future be seen to represent a significant turning point. However pulling the US out of that agreement was yet another move announced by President Trump on his first day in office. Such agreements are generally opposed by authoritarian nationalist movements, which want to minimise global collaboration of this sort and in practice have no real commitment to counter inequality.

It might be assumed that the emergence of nationalist strongmen as leaders would see a reversal of global integration and a re-strengthening of the state relative to corporations. However the picture is not that simple. Following decades of globalisation we have all come to rely on international trade for everyday necessities. There is every danger that an unco-ordinated rush to reverse this could result in a major decline in living standards that could lead to still further discontent. This is exactly what happened following the Wall Street Crash in 1929, when governments retreated into protectionism. Furthermore, leaders such as Donald Trump and Boris Johnson have never stood for stronger regulation of business, so the ability of states to improve how citizens and employees are treated by industry will not necessarily be strengthened by such leaders.

A clear example of a paradox at the heart of this movement emerged in December 2024, when Elon Musk, the billionaire businessman at the heart of the Trump camp, in pushing for more international visas for high-skilled immigrants, articulated a vision of the US not as a national community but as a hub whose prime objective was to attract international talent and wealth, a place where the ‘mediocre’ locals would have to take a back seat. This vision is clearly at odds with the anti-globalising rank and file of the Trump movement, and yet Donald Trump expressed his support for it. It is still not clear where most of these leaders see this movement as going. On his first day in office President Trump announced a new large-scale campaign to deport illegal immigrants, which will reassure his supporters looking to see fewer people whom they think of as competitors for their jobs. However, combining that with his support for Elon Musk’s insistence on recruiting leaders of business from overseas offers little reassurance that local people will ultimately be in charge. The prominence of tech billionaires on the platform at the presidential inauguration underlined a stance towards globalisation which is not about either regulating or ultimately blocking it.

In the absence of effective multilateral systems of global governance, national governments will find it much more difficult to respond to pressing challenges such as climate change, increasing movements of population in its wake, global crime, including cybercrime, regulation of the internet and increasing competition to attract investment at the expense of local living standards. It is trends such as this that will threaten the cohesion and effectiveness of states at national level if they lose the ability to collaborate with each other.

With the election of Donald Trump to a second term as US president, a number of commentators have talked about the end of a thirty-year political ‘supercycle’. The analysis is that the period of the two world wars was largely one of protectionism, followed by thirty years dominated by social democracy, followed then by thirty years of neoliberalism. On this rather deterministic view, we are due for another thirty years of protectionism again. There is something comforting about this suggestion that we have been through all of this before and it will all come around again.

However there is a certain myopia that derives from a historical perspective that looks no further back than the twentieth century. For one thing, Donald Trump has been the first sitting US president since the country was founded over two centuries ago who actively attempted to refuse to surrender power after losing an election. Not only did he actively resist; this did not prevent him from being re-elected. On his first day back in office he pardoned the people who had led a physical invasion of Congress in support of his campaign to overthrow the electoral result, describing them as victims of injustice. This is a symptom of a departure from precedent that goes deeper than any thirty-year cycle: there is a danger we may actually be seeing the end of a 350-year supercycle.

Over the past three and a half centuries there has been mostly consistent momentum in favour of broad social, political and economic progress in Europe, and more recently globally – even if interrupted by periods of crisis and regression. The danger now is that we could be fated to return to the fractured dynamic of a sort that largely prevailed over the previous three and a half centuries in Europe, an era that I call the Mercenary Era, an era where states were much more fragile and had uncertain authority.

The Mercenary Era began with the Hundred Years War (which despite its name lasted for 120 years) and ended with the Wars of Religion which lasted for over 100 years until the late seventeenth century. Although the Hundred Years War was centred on France, the violence spilled over into all neighbouring parts of Europe as many princes and mercenary captains involved decided to pursue ambitions elsewhere. Both that period and the Wars of Religion were accompanied by disasters involving in each case the loss of roughly a third of the population over large parts of Europe – six times the proportionate impact of World War II. While disease was certainly a key factor in this, a society where large mercenary armies were roaming the countryside over long distances, living off the land and leaving large parts of society on the edge of starvation, presented ideal conditions for the spread of disease during both periods.

The rise of the mercenary armies was facilitated by the growth of the money economy and banking in the middle ages. This enabled much larger forces to be raised and to be maintained in the field on a more continuous basis than with the traditional local feudal levies. In the period before the fourteenth century, fighting generally took place on a smaller and more local scale in Europe, with forces such as occasional crusading armies – which mostly directed their attentions outside of Europe of course – being very much the exception. As a whole, there was less broad progress in society during the Mercenary Era than during the three centuries that preceded it, which had seen the original rise of banks, universities and parliaments – institutions that have helped to define Europe’s distinctive character.

This perspective is obscured by our long-established habit of seeing the Renaissance and Reformation as the fundamental dividing line between Mediaeval and Modern. In reality, the period from 1320 to 1660 had many common enduring features more typical of it than the eras before or since, from prolonged warfare, armies only sometimes under the control of government, challenges from ‘over-mighty subjects’, paranoia about witchcraft and unseen forces interfering in society, outbreaks of plague and governments constantly on or over the edge of bankruptcy, to widespread popular revolts.

The Mercenary Era was dominated in political terms by footloose dynasties that were happy to establish themselves as rulers in any part of Europe, in a number of cases as rulers of a whole collection of them at the same time. The armies that they commanded were equally footloose as they were available for hire. A basic problem with such armies, and the fundamentally fragile states that hired them at prices that they frequently could not sustain, is that when their employers went bankrupt, rather than retire from the war the armies would live off the land, commandeering whatever they needed from the societies around them, and spreading further hunger, violence and misery. Mercenary armies unleashed on a territory were frequently impossible to call back.

The weakness of the states hiring them was due to their being essentially feudal patchworks of vastly varying private privilege, whether aristocratic, clerical or civic. Thomas Hobbes, in observing the level of violence in the society of the mid-seventeenth century, concluded that life can ultimately be made tolerable for people in society only if the power of the state can be made absolute. He was not necessarily promoting the idea of absolute monarchy – the concept of absolute authority can be applied to any type of state, be it a republic, a commonwealth or a monarchy. While there may be a division of powers within the state and accountability of the executive to a parliament within laws that are enacted, the authority of those laws and of any decisions lawfully taken by the state can still be made absolute.

The kind of state that has existed since the end of the seventeenth century has actually given effect to what Thomas Hobbes was looking for. Over the turn of the eighteenth century, monarchies and other states centralised military power under their control in the form of standing armies. The great aristocrats no longer had the power to independently raise their own armies, with the potential to challenge decisions they did not like.

The impact of that change has been profound. The eighteenth century saw a much more stable world than the seventeenth, marked by both economic growth and industrial revolution and also by the scientific revolution and Enlightenment. When armies went to war they were now more professionally organised, with their own baggage trains, rather than living off the land and the society being occupied. Wars could be controlled and limited successfully by governments much more effectively than in the previous era. James Boswell remarked at the time that ‘wars are going out these days, from their mildness’. It was a period where the middle classes developed markedly in their wealth and power. By the eve of the French Revolution, most land in France was owned by the bourgeoisie, not by the aristocracy.

Since the turn of the eighteenth century we have seen not only the Enlightenment but recurring waves of scientific and technological advance, as well as more ambitious campaigns by governments to improve the quality of life of their citizens, including reform movements such as the abolition of slavery, introduction of universal education and later the establishment of welfare states and universal healthcare, and a growing sense that progress is normal and even inevitable. The emergence of strong states with full authority over the last three and a half centuries has been an essential precondition for the general advances in quality of life that have been experienced by the majority of people in Europe, and in many other parts of the world too, especially more recently.

The strong states which brought Europe through the eighteenth and nineteenth centuries were, by the twentieth century, coming up against the issue of globalisation. The lessons of the Great Depression and World War II showed the absolute need for collaboration both to keep the economy on the rails and to keep the world safe. In the era we are living in now, we have witnessed the unprecedented success of the system of world governance established at the conclusion of the Second World War, including the United Nations and all its agencies, underpinned by the so-called Bretton Woods system of economic order, based on the new institutions of the General Agreement on Trade and Tariffs, World Bank and International Monetary Fund, as well as NATO. It has remained a system recognisably based on nation states with unchallenged authority within their own borders – who nonetheless have committed to upholding an effective structure of global rules in how they conduct their affairs.

The very success of that system has, however, spawned new forces that have increasingly threatened to undermine its coherence and sustainability. The challenge in each age, where a system of governance is largely successful in facilitating development, is to ensure that the system can adapt to the new forces that arise. It is instructive to consider the parallel with the French Revolution, comparing the current system of global governance with that of the eighteenth century French monarchy. We have all heard about factors leading up to the Revolution, such as periodic outbreaks of hunger in rural areas, government finances in crisis, entrenched legal privileges of the aristocracy and clergy, and the Enlightenment ideas being propounded by the philosophes. There is one fundamental additional factor: the French Revolution was also a result of the success of the French monarchy over the previous century and a quarter. It resulted, not from its inherent failure, but rather its failure to adapt to the results of its success. It was the monarchy’s success that unleashed the growing financial power of the bourgeoisie and intellectual interest in science and new ways of analysing society, and it was those forces that were to go on to challenge the monarchy itself. Indeed a further lesson from this revolution and others is that it takes a stable state structure for democracy to have a chance to take control.

Similarly to the French monarchy, the so-called Bretton Woods system, NATO, the EU and other pillars of the postwar global framework have been sufficiently successful as to unleash forces that can become so powerful as to challenge its successful continuation if it does not develop further. This system is now effectively under attack from two directions. On the one hand, the growth of globalisation itself threatens the coherence and authority of the network of national states that underpins it. From the other side, the instinct of all hardline nationalist movements responding to the forces of globalisation is to look for opportunities to withdraw from multilateral bodies that engage in collective decision-making and actions.

What we are seeing now is a growing threat to that stability and authority of states which has been such a fundamental requirement for the progress that we have come to take for granted. The force that most consistently compromises the authority of states today is the growing power of multinational companies. Today, for example, more than thirty global financial institutions each has more assets than two-thirds of the world’s countries produce in annual GDP. It is indicative of an ongoing shift in thinking that in 2009 the World Economic Forum meeting at Davos put forward the proposition that future global governance should not be exclusively in the hands of governments but should also include large companies and their representatives.

It is this power that has made it so difficult for governments to protect their people from the impact of growing economic inequality. Not only do such organisations wield tremendous financial and economic power, but even in the military world the footprint of private organisations, such as Blackwater in the US and the Wagner Group in Russia, has been growing. The development of crypto-currencies represents a further movement to develop economic structures beyond the power of government to regulate. Dismantling global systems of multilateral collaboration between governments will have the effect of empowering such private global players even further, as their ability to play governments off against each other will be stronger.

The absolute authority of government is under attack in the US in other ways. The US Supreme Court has shifted towards seeing the country as more of a confederation, where the authority of the federal state to compel individual states to take action on issues that affect all, for example administration of vaccines or clean energy, is no longer upheld. The hard line taken by so many politicians in the US, particularly in the Republican Party, on the right to bear arms, is yet another factor that compromises the authority of the state. There is no sense among these politicians that there should be any constraint on the right of wealthy individuals to arm large numbers of their employees with advanced weaponry. While many Trump supporters may be rebelling against the impact of globalisation when it comes to the loss of jobs or investment overseas, they have no problem in principle with private companies having a free hand to operate however they want and they persist with the idea that government is ultimately the problem. The vision of a world dominated by footloose global corporations and private military providers is one with which a large, and possibly dominant, part of the Republican party is entirely comfortable. It is a vision which has much in common with the practices of the Mercenary Era.

It would be a mistake to regard the emergence of Donald Trump and his MAGA movement as being the product of just one person. Even by the 1990s, a consensus emerged in US politics that no attempt to propose that the US take any further move to pool US sovereignty for any purpose would have any chance of passing Congress, including signing up to the International Criminal Court. The willingness of President George W Bush to ignore the wishes of allies or global institutions in undertaking the invasion of Iraq marked a further hardening of a go-it-alone mentality in the US. The Tea Party movement in the Republican Party grew swiftly from a fringe to a dominant element of the party, with the main drive of this movement being a determination to minimise the scope of government.

The proposition that strong government is the enemy of freedom is not, however, supported by the evidence of history. Indeed, the most anarchic period of all in European history was the Dark Ages of the ninth and tenth centuries. This period, when central government had essentially collapsed, saw the original rise of the feudal system, when successful military entrepreneurs established their control over local populations and succeeded in enslaving the great mass of the population through serfdom. This was most definitely not a case where the weakening of central government resulted in greater freedom for all. Democracy would not have developed in Europe in the absence of strong systems of government.

The European Union itself has embodied a response to the challenge of globalisation that involves re-empowering government by moving decision-making on the regulation of business to a more international level, thereby making it harder for internationally mobile investors to play governments off each other by threatening to invest in their neighbours, where regulations might be lighter. The Union however currently finds itself in the doldrums economically and politically, much as it did back in the early 1980s, then requiring the major burst of reforms represented by the Single European Act and creation of the Single Market in order to move forward. The recent report on Competitiveness for the EU Commission from Mario Draghi could point a way forward here.

The EU cannot manage all of these issues alone – there has to be a broad-based international response to the challenges of climate change and biodiversity, issues of inequality such as corporate taxation, economic cycles and the financial system, and international crime. This broad approach, combined with a determined effort to reverse the trend toward inequality in wealth and income, is the only one that can succeed in gaining traction over the multiple challenges the world faces today. Ultimately, when it comes to ensuring that companies and their owners pay a fair share of the cost of running societies, what is needed is more action along the lines of the Global Agreement on Corporate Taxation of 2021, unfortunately now abandoned by the US.

There are a number of international bodies in existence today which provide a structure for coherent global governance. The United Nations is the broadest of these, addressing issues from national security to climate change. Overlaying this are the World Trade Organisation and the OECD, both of which play critical roles on the economic front. We need to see these institutions coming together more coherently, and the systems of governance on which they are based being reshaped to reflect the reality of the twenty-first century. However, the global system of governance is still in reality so fragmented that it will in practice require a coalition of leading world powers to come together to provide the leadership needed to get the world moving back in the direction of stability and progress and to take on challenges such as climate change and managing the impact of company decisions on people’s lives.

The growing BRICS alliance, a combination of the Chinese-Russian axis and more non-aligned states, can be seen to represent a challenge to the more Western-dominated global institutions, and if that rivalry were to take on a harder edge the results could be mutually destructive. At the same time, those countries are themselves in the process of putting in place some multilateral arrangements, such as a rival to the SWIFT consortium for conducting global financial transfers. This at least shows a willingness to operate through such global systems, offering the potential to come to more productive collaboration in the future. However, getting there requires both that the current war in Ukraine can be brought to a stop and that potential future wars are avoided –both of those conditions being highly uncertain.

The challenge in the early twenty-first century is that the ability of national governments to have definite control over their own territories is being compromised by the intensifying globalisation of the economy. If governments are to overcome this challenge they must come together to establish sufficient collective control, whether over climate change, food security, international crime or tax evasion. The need for collective structures to become stronger rather than weaker makes it more important that as many of those governments as possible are effectively democratic. The answer is not to passively accept globalisation. Nor is it a practical proposition to simply reject it – globalisation is a process that has been advancing for centuries and countries that have attempted to avoid it on their own have not generally fared well. What is needed is to collectively strengthen control over globalisation and make it work for the many rather than the few.

1/2/2024

Chris O’Malley is Vice-President for Regional Development and Engagement at Atlantic Technological University. He was formerly Director of Strategic Development at Dublin City University and was an MEP for the Dublin constituency between 1986 and 1989.

Advertisement

booksupstairs.ie

Dublin’s Oldest Independent BookshopBooks delivered worldwide