The spirit of the nineties and the malaise of today

It does not require great originality nor insightfulness to contrast the world of the 1990s and that of today. They are dramatically different in terms of distribution of economic power between nations and in terms of inequalities within nations. But they also differ in the ruling spirit, at least in the Western world.

Perhaps one can begin with Tocqueville’s characterization of a similar age in the 1830s France:

“The particular spirit of the middle class became the general spirit of government; it dominated foreign policy as well as internal affairs: an active spirit, industrious, often dishonest, generally orderly, bold out of vanity and egoism, timid by temperament, moderate in all things except in its taste for comfort, and mediocre; a spirit which, mingled with that of the people or of the aristocracy, can do wonders, but which alone, will never produce but a government without virtue and without grandeur.” (Tocqueville, Souvenirs [of 1848], my translation)

That spirit “bold out of vanity and egoism,” permeated societies within, and informed international politics. It was fundamentally born out of the defeat of Communism. It was an optimistic spirit of resuscitated capitalism brought to the front first by Margaret Thatcher and then Ronald Reagan, and Deng Xiaoping although he did not call it by that name. By the mid-1980s with Gorbachev in power in the USSR, the ideological ascendancy of capitalism as the way to organize the economy, and of liberalism as the way to organize society was reaching its peak. With the dissolution of the Warsaw pact and the disappearance of the Soviet Union, ideological and geopolitical dimensions were united. It was a triumph of an ideology, but equally a triumph of a set of Western countries. The two triumphs were distinct but in the minds of many of its beneficiaries they were seen as one: the triumph of the West was made possible by its adoption of a superior ideology. Nothing in principle impeded others of being equally successful if they accepted the same rules. Moreover, it was said, the catch-up in the technological and economic development that this would entail would not be resented by the then dominant powers because –and this was a significant part of the ideology—the world was “condemned” to live in peace and harmony. For does not trade between nations and individuals create a harmony of interests and a global market that can prosper only in peace, and do not “satisfied” democratic nations (to use John Rawls’ terminology) not envy each other and not covet territory or riches and thus have no need for wars?

Was the spirit of the nineties really believed by those who professed it, and were they aware that they might have believed it because it was pleasing to them morally and materially? I had always had trouble finding an answer to that question. But I have no difficulty describing and locating that spirit, particularly because I lived through it in an environment which reflected it probably better than any other place in the world: in Washington, D.C., working for an international institution and then for a US think tank. I was at the cross-section of the spirit that emanated originally from the ruling classes of the United States, but by the early 1990s became accepted by everybody who mattered anywhere in the world. Everybody who mattered (that is, who had some amount of political and economic influence)—and these were the people I would meet in and around Washington, might have they arrived from whatever faraway county—believed in it. Or seemed to believe in it.

It was a spirit that saw violent conflict as obsolete, that believed that all issues can be set aright through technological advances or economic schemes. It saw the commercialization of all activities not only as desirable as such but as a tool toward more prosperous and peaceful world. If there was still a problem, it was because no technical solution for it was yet invented, or a market where the problem would be auctioned off and resolved had not been created. It was exactly the middle-class narrow spirit, as described by Tocqueville: sans grandeur, but quite unaware of it and not seeking it. It was not a bellicose spirit; it was pacific and trustful of perfectibility of man and society. It was teleological. It did not see history as cyclical, but as a straight upward line.

What many of its adherents did not perceive was that it also suited their own material interests. They did not want to look at that part, or most likely were reluctant to acknowledge it even to themselves, And, in fact, that part was not even apparent so long as their interests were in accord with the spirit of the time. What created problems and ultimately destroyed the spirit of the nineties was that material interests of many individuals and geopolitical interests of some nations were no longer served well by the spirit of the nineties.

Materially, the rise of China and more broadly of Asia lowered the economic position of Western middle classes, made their jobs redundant or precarious, while on the geopolitical stage, the rise of China challenged the dominant position of the United States. This double change (at the individual, and national levels) revealed deep inconsistencies in the spirit of the nineties. It was argued that the spirit was “sharing” and cosmopolitan; and indeed it was so long as the relative betterment of the Third World involved countries and peoples without significant power or role globally. But as soon as that betterment spread sufficiently (as it did with China), it was no longer desirable. So, one was forced to conclude: improvement in welfare of the poor is desirable only so long as it does not markedly affect the relative power and the position of the rich. Once such a caveat is made, though, the entire pacific and cosmopolitan spirit if the nineties is exposed as an ideological cover to service interests of the rich.

If we go farther and look at the concrete applications of that ostensibly generous and cosmopolitan spirit, we find increasing inconsistencies: it applied variously to friends and to others. In words of Mark Carney: “we knew the story of the international rules-based order was partially false. That the strongest would exempt themselves when convenient. That trade rules were enforced asymmetrically. And we knew that international law applied with varying rigour depending on the identity of the accused or the victim”. Political self-determination in one case was approved, while in another it was frowned upon; liberal principles of multiculturalism and intermingling were in one case celebrated; in the other they were excoriated; democracy, if it brought to power desirable parties was praised, but the same mechanism in the case of “bad delivery” was ignored.

The more the redistribution of economic and political power advanced, the more the contradiction in the spirit of the nineties became visible. Rules had to be applied with increasing inconsistency because ideological inconsistency was the only way to maintain material superiority. Thus the spirit of the nineties began its slow, and then accelerated, decomposition until it was revealed to have been no different than the spirit of many past ages: an ideology adopted and promoted by those classes that did well by its rules and had an interest to maintain it. Once that became obvious, the elaborate ideological scaffolding created to make the system appear as equitable and as promoting global welfare, collapsed as well. We were back to the traditional situation when covering one’s own interest in the cloth of some general human advantage was no longer credible—so we went to a more brutal, but in many ways more candid, times of open struggle motivated by own interests alone.

PS. Empirical evidence on some of the points made here is presented in my Great Global Transformation.