Trump and Brexit won't kill globalisation – we're too far in

In Donald Trump’s long-awaited address to Congress, he said a “new national pride” was “sweeping across” the nation. He went on:

What we are witnessing today is the renewal of the American spirit.

With Trump’s electoral victory, as well as the Brexit vote, many of the assumptions underlying the future of globalisation have been put into question.

This, together with the rise of Pauline Hanson’s One Nation in Australia and other populist parties in Europe, indicates large components of the voting population want trade relations severed, borders enforced, and refugees more tightly screened.

So are we witnessing the reversal of decades of globalisation and moving back toward the nation-state as a political and economic ideal?

A challenge to globalisation

The term globalisation has been ascribed to capture the improved connectivity between people and places. It’s driven by enhanced trade, mobility, migration, and human interaction that is generally global in scope.

Globalisation is one of the many processes associated with neoliberalism. This is a political and economic doctrine that, since at least the 1970s, has privileged privatisation, liberalisation, and market-oriented logic. It is also strongly associated with “free” trade and reducing barriers to the movement of goods and labour within and between countries.

Several political structures tied to globalisation have challenged the nation-state as the primary political unit. International bodies such as the United Nations, and multi-national blocs such as the European Union, serve to break down barriers between countries through large-scale political regulation.

Trans-border agencies and public-private partnerships have performed much of what nation-states cannot accomplish on their own, as have non-governmental and non-profit organisations.

The rise of multinational corporations in the second half of the 20th century has also posed a series of challenges to nation-states. Annual revenues of some corporations exceed the GDP of many medium-sized countries.

A return to the nation-state?

The current political turn reflects a significant counter trend to globalisation. Instead of being broken down, national borders are being reinforced. Trump’s campaign promise to build a wall on the southern border and the UK vote to re-erect barriers to movement across the English Channel represent a stark shift away from globalisation.

Reacting to concerns about “illegal” migrants, and the well-rehearsed arguments about immigrants “taking our jobs”, largely white and older voters favour inhibiting human movement. Populist politicians are attempting to mitigate the “haemorrhaging” of jobs across borders.

Multiculturalism is being rejected rather than embraced. Driven by the elusive idea nation-states are defined by demographic and cultural uniformity, political nationalism has become a dominant rhetorical device.

The concept of what it means to be “British”, “American” and Australian in popular imagination has re-emerged as an important topic.

There are serious efforts to redefine the national economy, pushing back against the perceived encroachment of global interests. Trump’s abandonment of the Trans-Pacific Partnership parallels the UK’s withdrawal from the continental customs union.

The assumption underlying the “Make America Great Again” campaign was that the domestic US economy was, at some point, a contained territory generating great wealth that had somehow been eroded from the outside.

So is it true? Are we actually witnessing something more significant than an electoral aberration? Will there be a long-term move away from globalisation?

Probably not

Several signs actually point to no. The populist trend is reflective of dissatisfaction with domestic affairs rather than a sustained disengagement with the rest of the world.

While public sentiment regarding changing national identity or political and economic power is very real, de-globalisation is highly unlikely.

We have yet to see a wall being built in Arizona, and a “soft Brexit” may be the most desirable pathway for the UK, given nearly half its good exports are to the EU.

A quick look at national demographic shifts in the US and UK suggests multiculturalism defines the present and future. US demographers are predicting a “minority majority” in the next 40 years. The fact Silicon Valley CEOs have so vocally opposed the Trump administration’s “Muslim ban” demonstrates that aside from being unethical, xenophobia is actually bad for business.

A movement toward closed national economies would also be unattainable. Trump has lauded the “re-shoring” of a few American jobs. But there is ample evidence this was happening before 2016 as factory wages slowly equalise with those elsewhere.

Erecting tariff barriers is also likely to be futile, as the rest of the world continues to globalise at a rapid clip. Terms like “domestic” and “foreign” have become increasingly obscure, and for good reason: globalised economic networks ensure that various components of products are sourced from around the world.

US “domestic” cars, for instance, often contain less than half American parts while “Japanese” cars are often comprised mainly of US parts and assembled in Kentucky or Ohio.

Fixing internal affairs

Clearly, many are unhappy with the current state of affairs in the US, UK, and elsewhere in the so-called liberal-democratic world – including Australia. But it is happening in spite of globalisation, not because of it.

Western political power has been slowly eroded in relative terms since the end of the Cold War. What disquiets the electorate is perhaps not the adverse effects of globalisation, but their countries’ position vis-à-vis the rest of the world.

Domestic issues, particularly the extreme economic polarisation and inequality of the neoliberal era, are more likely to blame. Globalisation is here to stay, and the economic logic of openness will supersede any cultural or political nationalism.