Globalists Versus Chauvinists

So, which kind of authoritarian capitalism do you prefer?

Transcribed from the 21 January 2017 episode of This is Hell! Radio (Chicago) and printed with permission. Edited for space and readability. Listen to the whole interview:

In a way, it’s no surprise that the anti-globalization movement that eventually rose to established power is driven more by selfishness than by altruism.

Chuck Mertz: Davos Man, an evolutionary stage in humanity brought on by the cultivation of a global elite, a class above all others that intends to guide us to their illiberal authoritarian capitalist utopia, seems to be evolving once again at the World Economic Forum. And the new iteration of Davos Man doesn’t look as American as past versions of Davos Man.

Here to explain, Rebecca Liao is a director of business development at Globality Inc., a stealth startup in Silicon Valley. Rebecca is also a writer and China analyst. She has an article at n+1 called “Trumpism and the Davos Man: The global elite now openly admires authoritarian capitalism.”

Welcome to This is Hell!, Rebecca.

Rebecca Liao: Thanks so much for having me, Chuck, good morning.

CM: It’s great to have you on the show. This is an amazing article.

You write how the Davos Man is a “genuinely novel outgrowth of the age of neoliberalism, and globalization ‘thinkers’ were the organic intellectuals of the globalist class, a new power elite. The precursors to the current generation of writers and institutions were business-intellectuals like Peter Drucker, and midcentury conferences like the Aspen Institute, which exuded a sheen of intellectualism designed to appeal to the wealthy. But the era of hyper-globalization that began in the 1980s and 1990s demanded different, more worldly offerings for the rapidly growing globalist class. It was during this time that the World Economic Forum came into its own and TED was founded. These organizations catered to the aspirations of the national elites to gather and become global elites.”

Is that who is being challenged around the world today, whether it’s here in the US by the populism from Trump or the populism from Bernie Sanders, or in the UK with Brexit, or in France or Germany? Is the Davos Man what is being challenged today?

RL: I think so. People seem to have thought this is a unique American strain of anti-intellectualism or anti-elitism, and around the world what they have a problem with is economic inequality, or people have gotten left behind by globalization. But what I’ve found is that people don’t have a problem with rich people—as we can see from Trump’s cabinet. His supporters are sticking with him despite the fact that his cabinet appointees, combined, have the equivalent of a third of American wealth, which is a pretty mind blowing stat.

So what is it people really have a problem with? The issue is really cultural. There has risen this global elite that had its origins in the post-World War Two era. With the start of globalization a lot of problems that were really only applicable on the national and local level all of the sudden became global, and the aspiration was to solve them on a global level. And the most powerful and wealthiest people (or people who aspired to be) began to think on that level. And they both metaphorically and literally “left home.”

The people who support Bernie Sanders or support Donald Trump—they feel that. They know that their countrymen have left home and really don’t care. They know they go to these global gatherings like Davos, like Aspen, like Ted Talks. These are invitation-only, and they are very expensive to attend. And the people there talk about their own rarefied problems, and about global problems that they’d like to solve without very much knowledge about what’s really going on on the ground.

CM: You write, “Trump built his campaign on militant nationalism. ‘Americanism, not globalism, will be our creed,’ the president-elect said when he accepted the Republican nomination. His election caps a year in which globalization came directly into the crosshairs of populism all over the world.

“But if Trump and his ilk are Americanists, what has happened to the boosters of globalism—the so-called globalists? Once the target of anti-globalization protesters, in Seattle and Genoa, the Davos Man is now the target of elected officials.”

If this new right—the people who support Donald Trump—is anti-globalization, where were they during the Battle for Seattle? To you, what explains why only the left protested globalization, but it seems only the right has attained power through anti-globalization?

RL: Anti-globalization has many shades. There are many Bernie supporters who did not vote for Trump who are also anti-globalist. It really depends. At the Seattle protests, they were protesting the WTO. It was really about fair trade, and it was about a living wage for people in Third World countries, who were producing the goods being sold in First World countries. People remember that protest now as a sort of a “coffee protest,” if you will. It was about fair trade coffee, these goods coming from Third World countries, and it was really a protest on behalf of fellow global citizens.

Whereas the anti-globalization we see now, what has been rising in the last five years, is really an “Our Country First” anti-globalization movement. It isn’t on behalf of Third World workers being exploited. It’s on behalf of the jobs that have left your own country and gone to cheaper environs. And it’s also been against the culture.

This strain of nationalism has been incredibly powerful ever since the mid-nineteenth century. If we define the nation-state as the unit of power and governmental organization within the world, having stuck to that for so long is an incredible emotional lightning rod for people to return to. And so in many ways it’s no surprise that the anti-globalization movement that will eventually rise to established power is driven more by selfishness than by altruism.

CM: I saw this blog post this week by somebody very pro-market, saying that they didn’t understand why activists on the left who were anti-globalization (and anti-NAFTA in particular) aren’t giving Trump a chance to actually fix the problem that they’ve been complaining about for so long now that he is in office,

Should those on the left who have been protesting globalization be skeptical of any Trump anti-globalization plan? After all, if Trump is anti-globalist and I were someone who had protested globalization, shouldn’t I be siding with Trump on trade?

RL: I’m probably going to butcher an Obama quote. In his farewell address in Chicago, the line that got the largest applause of the night was: When the bottom 99% fight among one another for the economic pie, the top 1% stands there and laughs, and takes everything while everyone else fights for the scraps. Of course he put it more eloquently, but that’s the general idea.

I think the left has recognized that this is the game that Trump and his cronies are playing, which is to get people in the 99% to engage in class warfare among themselves so they’ll hate each other so much that they’re not going to notice that the rich are actually just going to get richer.

A lot of people tried to give Trump the benefit of the doubt, saying his bluster was just a campaign tactic, or that he’s really not a know-nothing and we underestimate him, that he’s going to stick to his guns and get jobs in America and pass economic reforms, and it’s going to be great. But the fact of the matter is he has no policy loyalties. What he has shown through his cabinet appointments in particular is that he is loyal to people. He is loyal to people who are loyal to him. That’s how the game is played, and that really doesn’t leave much room for the kind of anti-globalization critique that the left as raised.

CM: You write, “In the days following the American presidential election, some of the most prominent globalists stepped forward to declare that globalization bears significant responsibility for the current populist resurgence.” Then you quote globalists like Barack Obama, Thomas Friedman, Niall Ferguson, and Fareed Zakaria.

To what degree have these globalists really taken responsibility for the rise of Trump? And have they decided to amend their ways?

What sort of information age do we live in if only two minutes of preparation qualifies you to be an expert? But that’s the global ethos, that’s the culture of Davos.

RL: Well, when you get a shellacking like we did in the November election…it was a huge shock to everybody, and the natural response was, “Why? Let’s figure out why this happened.” And a lot of globalists rightly pointed to the fact that globalization has left a lot of the population behind, and that there is a certain cultural ignorance among them about their fellow countrymen, and over time that has led to a feeling of alienation and a desire to disrupt the entire system and elect somebody like Trump, or elect to leave the EU.

But people have a way of getting over things very quickly, and we then saw, towards the end of November and early December, editorials like the one by Martin Wolff, for example, in the Financial Times, showing a real sense of anger among the globalist class. “How could the Trump supporters do this? Don’t they understand that this man doesn’t actually have their best interests at heart?” And there has been a little bit of Schadenfreude about these people finding out the hard way that they elected someone who is going to act against their best interests.

Comforted by that thought, the globalist class went to Davos. And then President Xi Jinping arrived from China and assured everyone that globalization is good, that there are no winners in a trade war, and that the globalists have an ally in him. We have to remember that by person/power parity, China is already the largest economy in the world, and for the globalist class (which is so defined by wealth and power and your ability to navigate the world), Xi Jinping has become a sort of patron saint.

The globalist class doesn’t really have to be chastised. They don’t have to feel responsible or really even do anything, because they don’t have to. Their lives are not set up in such a way that they have to rise up and protest and find a way to fight this.

CM: So if people in the globalist class aren’t opposing Trumpism, how is the global ethos that is embraced at Davos and the World Economic Forum—how is that ethos in opposition to Trumpism?

RL: There are several aspects, but first and foremost: Trump thinks on the national, local level. His tagline is not just Make America Great Again, but America First. With any issue that could have global consequences, we will think of America’s best interests first. Some people would argue that in order to really consider America’s best interests, because the world is so interconnected, you have to think about other countries as well—he does not agree with that perspective.

The globalist class really argues against that. They see the world as completely interconnected. A pin that drops in India is going to be felt in Kazakhstan. They also believe (and this is something that I actually have a great deal of sympathy for) that international cooperation is for the benefit of all. There is an emphasis on getting together and coordinating national growth rates (which is something that the IMF has tried to do), or getting together and coordinating national monetary policy. These are all things that could potentially be very helpful.

It’s this belief in keeping dialogue open with people and governments of other countries that Trump does not believe in. He doesn’t see very much benefit from international cooperation.

CM: You write about how globalists work at having the appearance of impartiality, a “sheen of authenticity.” How much does the Davos Man actually offer an impartial set of facts that are worthy of our credulity? How impartial are they, and how much authenticity do they really have?

RL: It’s always been very difficult gaining insight from these organizations like Davos and Aspen and TED. On the one hand, as these organizations have matured, they have grown think-tank infrastructure around themselves, and the people who staff these think tanks have, in some cases, a great deal of experience and knowledge, their hearts are in the right place, and they really do want to come up with solid policy prescriptions that can be implemented and improve people’s lives.

But on the other hand, when these organizations have their big annual conferences, the globalist class flies in from everywhere, but they don’t necessarily know everything they’re talking about. I remember very vividly: a few years ago there was a profile written on one of the most prominent members of the globalist class (who shall remain nameless)—and this was said in praise of her, but I thought it was kind of worrying. Whenever she is called to do a TV interview, she can look at talking points for about two minutes and then sound really eloquent on air. What sort of information age do we live in if only two minutes of preparation qualifies you to be an expert?

But that’s the global ethos, that’s the culture of Davos. This is what happens when there are a lot of powerful people in the same room who are very accomplished in their own fields, and they are expected to talk about things at a 10,000-foot level. A person goes from running a 10,000-person company to talking about the welfare of three billion people, for example. Everyone is expected to say something coherent and knowledgeable, and people…just…talk.

People are compelled to talk at these gatherings, and that’s what they do. They talk. It’s a lot of hot air. People don’t really know what they are talking about, and this diminishes the potential of these organizations to do good. They might have a lofty mission, but this sheen of intellectuality is not helping them achieve their goals.

CM: You write, “Arianna Huffington brought the Davos model to the media. The annual gatherings sponsored by WorldPost (an offshoot of the Huffington Post), Forbes, Foreign Policy, and other magazines have become legitimate must-attend events. These publications host ‘big ideas’ panels, where their journalists can engage in dialogue with VIP guests, many of whom sponsor the events. The overall result is an amalgam of business, politics, and media that is at once vacuous and incredibly powerful and influential.”

Is this the new way globalists do business? Business, politics, and media getting together and working as one, instead of as checks and balances against each other?

RL: Yes. That’s one of the real problems that is diminishing the efficacy of this group. The journalists who go, for example, think of themselves as the best people in journalism (and the great thing about journalism is you travel around the world, you report, and you’re a base of knowledge in many ways). It’s the “best” journalists, the best academics, the best thinkers, the best businesspeople, the best politicians—they all get together in a room, and they regard themselves, together, as the most important stakeholders in the global system, and think that if they talk among themselves they’ll be able to come up with the best solutions, and that they’ll be able to implement them.

None of the jobs are going to come home. We’re going to lose our dominance in science. We’re going to cede our investment in combating climate change to another country. We’re going to lose our financial predominance, because other markets are going to be seen as much more stable and lucrative for investment. That’s all going to happen, and it’s going to have reverberations down the line, and Trump supporters are going to feel it.

Whether they blame him for it is going to be another matter.

It’s a nice thought. But what ends up happening is checks and balances get eroded. These groups are supposed to oppose each other in certain respects. Journalists are supposed to report and keep the businesspeople and politicians in line. The businesspeople are supposed to offer a different perspective from the politicians and the journalists, and the politicians are supposed to serve the people who put them in power. But there is a social dynamic that takes over once these people convene, and the impulse is to get along. Because you don’t want to get shut out.

As a journalist, you maybe hold your fire when you come up against star power in business or politics. In politics you want the support of the businesspeople and the media, of course, and the businesspeople would love nothing more than to have everybody’s support, it just means more profits. So everybody’s mandate is to get along, and if there are issues, you don’t address them head on. You wait until you’re no longer in the room together. It leads to a culture where it’s much more important to keep your membership in this globalist class than it is to do your job.

CM: You write that at Davos, “Tech and China have been deemed the future and have become the focal point for people with globalist leanings, leading to their further isolation from the circumstances that affect most people throughout the world.”

How does leaning towards tech and China as the future lead to a Davos crowd that is more isolated from the people?

RL: In many ways. I live in Silicon Valley. We have threatened to secede from the United States many times, when we’re unhappy with how the rest of the country is going. We threatened to secede when George W. Bush was re-elected. We threatened to secede again after the election of Donald Trump. We think of ourselves as a different country. When outsiders come to this area, despite the fact that we pride ourselves on being very inclusive and diverse, they do feel like it’s a completely different culture, unlike anywhere else in the world.

The globalist class wants to live in this “space.” They wouldn’t necessarily move here, but they admire Silicon Valley very much. They try to replicate it around the world. It’s an area where it’s almost your job to not think about reality too much. What we say about founders out here is that if they are too aware of the weaknesses of their startups then they’re never going to make it. It takes a certain amount of enthusiasm, optimism, and delusion in order to get something like a Facebook or a Google off the ground. And because tech has become so influential and so incredibly profitable—and it has obviously had an enormous impact on people’s lives—the globalist class has paid attention, and they would really love to replicate that success and that spirit of innovation if they can, which means adopting that culture. And this culture is by requirement a little removed from reality.

That’s tech. China, now, is an interesting handful. Because on the one hand, people have been criticizing China forever about human rights abuses, its generally illiberal society, and its authoritarian government. Yet at the same time it’s lifted hundreds of millions of people out of poverty. It’s really an economic success story, and it’s the main one from the last fifty years that has really proven that globalization “works.” For the globalist class, it’s a very comforting example to have.

And that’s also the attitude of Chinese people. Chinese people are very outward looking. They send delegations out of the country all the time, just to learn—for no other reason than to learn. They might not have an express business purpose. They just go out of the country to learn. It’s a real commitment to globalism that I’m sure the globalist class finds incredibly welcoming and comforting.

CM: You write about the potential for the kind of authoritarian capitalism that the World Economic Forum sees as a possibility for future government. You write, “essentially this government amounts to a combination of Chinese meritocracy through the civil service, the dual houses of British parliament, and an executive insulated from the pressures of direct democracy. Meanwhile, the people can participate through social media (this was back when Weibo, China’s Twitter, held the promise of being able to effect change from the grassroots. The government cracked down on Weibo the following year). Prominent members of the Davos caste, Berggruen and Gardels, have arguable done the most (outside of China itself) to promote the soft power of the country’s autocratic system.”

So an indirect representative democracy led by a political class, and if the people want to organize and practice direct democracy they can do that on social media and sign petitions and go to permitted marches—is that the future which populism is rising against? And to what degree do the people who voted for Trump know or at least have the feeling that this is the goal of the globalist class?

RL: I think the people who voted for Trump don’t have much awareness of this great love that the globalist class has for China or for other authoritarian capitalist systems. Nicolas Berggruen and Nathan Gardels came up with this idea around 2009, so right after the 2008 financial crisis. 2008 was a bellwether year for China: it had survived the financial crisis much better than any of the economies in Europe and America; it had hosted the summer Olympics, which were a wild success. So people really began to think that maybe authoritarian capitalism is the way to go. We had a good run with democracy, but it’s completely broken down. There’s such political gridlock, and people are suffering for it. So maybe China is on to something here.

And instead of thinking about ways to work within the existing systems in Europe or in America to reform the system and somehow reduce political gridlock—to find a way for politicians to speak to one another, to help fix the system that we have at home—the globalist class began to think, well, why don’t we just become China?

Consider the fact that the US, France, and Russia have been able to get cozy with one another because they all believe in a more authoritarian system and a global political system that is determined by balance of powers as opposed to values. That’s another place we’re seeing greater medievalism.

This also hearkens back to the Silicon Valley-esque fantastical idea of “disruption”: how can we completely disrupt the system, change it and make it look completely different? This mindset that the globalist class has—this idea of endless possibility—is frankly annoying and threatening to a Trump supporter or a Bernie supporter or any populist. They’re thinking to themselves: you’re the best and brightest that our country has to offer, and instead of staying home and thinking about how to fix problems here and think about our political culture, the way we do things, you’re saying we should just copy another country, or maybe you’re spending more time in that other country and lionizing it.

There’s a disconnect in national feeling that has become incredibly counterproductive.

CM: You write about Parag Khanna, one of the “stars of the globalist firmament,” who claimed at a book event you attended that globalization is his middle name: “Khanna’s primary examples of the new globalist state are Singapore and Dubai. If these business-friendly locales have an identity, it is comprised of utmost devotion to the profit motive, competence, and the new. The people who have found their semi-permanent homes in these global cities are typical of those who have benefited most from globalization. They have entrepreneurial ability, a strong education background, and capital or other assets. They have survived the increasingly flexible (and therefore unprotected) global labor markets. Khanna admires their casteism.”

Then you quote Khanna saying, “In the West, people have evolved a false piety. They are uncomfortable acknowledging their comfort with this new medievalism. In Dubai and Singapore they are not.”

New medievalism? I know people who have lived in Dubai, and they told me they absolutely hated it, especially the sexism and lack of rights. If we are heading to a new medievalism, what will it be like? And how will it be medieval?

RL: I think Parag is talking about two different things here. The first is that in cities like Dubai or Singapore, on the one hand it’s incredibly capitalist—people are sold the “American Dream.” If you work really hard, if you’re really entrepreneurial, then you can make it to the top. This city, this culture is all about business. But at the same time there is this feeling—and it’s not just casteism or medievalism; there’s a little shade of Asian culture in here as well. Which is to say, people sort of know their place. If you are a billionaire, you get chauffeured around and nobody really says anything about it. If you are a street sweeper, then you don’t make eye contact with the billionaire, and everybody is okay with that. Feeling averse to that is the sort of piety that Parag is referring to. Here in America, for example, there is a culture of egalitarianism: you couldn’t say what I just said about the street sweeper and the billionaire. Cities like Dubai and Singapore don’t have that piety.

In some ways, though, I think we are headed towards that. I know people are fighting against it, and I really hope they succeed, but we’re really approaching a more stratified society in which social mobility is not happening; it’s not true that if you work super hard then you get to be in Donald Trump’s shoes. Everybody sort of has their place in life.

Or look at it this way: the people who voted for Trump voted out of economic dissatisfaction (among many other things). Their jobs went to other countries, they are not in a good position, financially, they might be addicted to prescription drugs. All of this is terrible and they want to fix it. But what is their ideal? Their ideal is to get their manufacturing jobs back and to have a prosperous life for their family. It’s not to become Donald Trump.

This enforced tribalism is what Parag is talking about. I think a lot of people are getting more comfortable with the idea: I know my place in life and in the world; I have no aspiration to be part of this globalist class; I just want to carve out my little niche in the world and stay there. That’s one form of medievalism that’s manifesting itself—and really making a comeback.

The other form of medievalism is a little more geopolitical, in the sense that in the Medieval ages there weren’t nation-states. There was just a balance of power among loose federations, if that. The world was much more chaotic. That’s what we’re tending towards again now. I don’t think the nation-state as an organizing unit is going away any time soon, but there are international organizations that are also part of global governance, and there are countries forming alliances with one another, thinking not so much about their own national heritage and more about larger ideas about what sort of global order they believe in.

Consider the fact that the US, France, and Russia have been able to get cozy with one another because they all believe in a more authoritarian system and a global political system that is determined by balance of powers as opposed to values (such as democracy, human rights, etcetera). That’s another place we’re seeing greater medievalism.

Honestly, I wish I knew how to fix it, I wish I had ideas about how to get it back to a system in which values matter and it’s not all about power and we didn’t have to stick with the station that we are allotted in life, but I think that’s really where things are trending.

CM: So how much damage will be done to the people who voted Trump into office, by Trump turning his back on the globalist class?

RL: Donald Trump, so far, has been much too unaware of the consequences his actions have on a global level. His supporters are going to suffer, because what we do here in the American market is going to affect markets elsewhere and is going to affect demand and supply back home. The Trump team needs to work out these checks and balances before they decide on an economic policy, because it could very well be that if they decide to turn their backs on globalization, then none of these jobs are going to come home. Not only that, but we’re going to lose our dominance in science. We’re going to cede our investment in combating climate change to another country. We’re going to lose our financial predominance, because other markets are going to be seen as much more stable and lucrative for investment. That’s all going to happen, and it’s going to have reverberations down the line, and Trump’s supporters are going to feel it.

Whether they blame him for it is going to be another matter. Wrapping yourself in nationalism tends to be a very helpful tool to protect yourself against criticism.

On the other hand, one positive thing that has come out of all this is that the globalist class might be forced to stay home a little bit more. Just as a personal example: after the November election, I half-jokingly (along with many other people) said that maybe it’s time to move to Canada, or Berlin, or Beijing. Then I chastised myself, because this is precisely the problem. When you have resources and the ability to go elsewhere, the tendency is to want to go elsewhere when things aren’t going well at home. But in a perverse way, Trumpism has brought about a new emphasis on home for me and many other people, in the sense that things aren’t going well at home, so we have to think about how to save things where we are.

CM: Thank you so much for being on our show, Rebecca.

RL: I had a great time. Thank you so much, Chuck.

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