Will the Liberal Order Destroy Itself?
Hanover, New Hampshire.
On the day after the U.S. presidential election, I trudged across campus to teach my class. For months my colleagues and I had laughed or jaw-dropped at Donald Trump’s statements and behavior, but knew his election was an impossibility. He had just been elected the president of the United States. I passed by groups of students standing together, a few of them weeping, friends awkwardly patting their backs. Colleagues walked zombie-like past me. Something had died; the campus was grieving.
One dream that died that day, in the eyes of many, was the liberal international order: the order that candidate Trump had pledged to dismantle. Since his election, he has indeed weakened this order; he has undermined the trust that America’s allies have in its leadership; he withdrew the United States from the Trans-Pacific Partnership and the Paris agreement on climate change; he has threatened to withdraw the United States from the North American Free Trade Agreement and from the disarmament agreement with Iran.
While Trump is no friend of the liberal international liberal order, his ascent is not the cause but a symptom of its problems. The greatest threat to the order is the order itself: more specifically, the people whom it dislocated and antagonized. As the liberal project scored victories, its well-intentioned proponents grew increasingly ambitious. The liberal project has grown into a vast prix fixe menu with items on it that many countries would prefer to skip. To stem the backlash to the liberal order, its leaders need to rein in these ambitions and allow countries to order à la carte. This may be the only way to keep the establishment in business.
The liberal international order refers to a set of ideas and institutions after World War II. Free trade and free capital flows have encouraged the outsourcing of production. More open borders have allowed extensive migration particularly from the developing “south” to the advanced industrialized “north.” The order also rests upon a set of liberal beliefs and values, such as freedom and human rights. A set of institutions—negotiating and establishing norms and rules in trade, finance and many other issues—link these ideas together.
As the order succeeded, it expanded. The 1947 General Agreement on Tariffs and Trade (GATT) over time tackled an increasing number of trade barriers. An alliance created to contain the Soviet Union was refashioned after the Cold War into a liberal community, and expanded into Eastern Europe. The 1951 European Coal and Steel Community has since styled itself into a customs union, monetary union and international court of justice. In the 1995 Schengen agreement, several members of the European Union opened internal borders and adopted a common asylum policy. In these ways, the liberal order ballooned beyond its modest origins.
Clyde, Ohio. Three thousand employees at a Whirlpool factory build twenty thousand washing machines per day. Whirlpool is the largest employer in the county; its employees eat at the local restaurants, worship together at St. Mary’s and First Presbyterian; their taxes support Community Park and the Clyde schools.
Whirlpool has sought trade protection from the Trump administration. It accuses its competitor, Samsung, of dumping, and says that on a level playing field, it could create over a thousand jobs.But Samsung blames Whirlpool for failing to innovate and respond to changing consumer tastes. Shara Aranoff, an attorney for Samsung, compares the situation to the auto industry: “American auto makers have become much more competitive, foreign auto makers have established U.S. production creating thousands of American jobs, and consumers have more and better choices.” She declared, “Today we’re all better off.”
The free movement of goods and capital indeed created significant gains. Liberal international institutions (such as the GATT) cut tariffs, and countries specialized in what they were efficient at producing. Consumers benefited from more and better goods, and many countries lifted their people out of poverty. Of course we knew that free trade would dislocate some people, but economists told us that dislocated workers would move out of sunset sectors and geographic areas, and that the welfare state would ease this transition.
What actually happened? In European countries, where social democracy thrives, leaders created welfare programs to buffer workers from trade dislocation. But in the United States, the state failed to uphold the social compact of free trade: as globalization expanded in the late twentieth century, the U.S. government slashed both taxes and welfare benefits.
Free trade with China hit U.S. workers particularly hard. Bill Clinton and other liberal internationalists celebrated China’s entry into the World Trade Organization in 2001. Economists forecast that the benefits to the U.S. economy would be high, and the costs to dislocated workers modest. As Jordan Weissman notes, “Things did not work out quite as the 42nd president hoped”; that this had the effect of “decimating American factory towns . . . and upending old assumptions about how trade affects the economy.” To be sure, a trend toward greater automation was a major contributing factor. But economists estimate that the “China Shock” cost the U.S. economy over two million jobs, and workers did not adapt as the economists had anticipated.
Plants closing—feared by Whirlpool’s workers in Clyde—means people cannot provide for their families. Factory closures ripple out to the community; the decreasing tax base means fewer resources for schools, and fire and police departments. Stress soars as people often replace a higher-paying job with temporary work or with multiple part-time jobs. In the United States (until recently), people also frequently lost health insurance. Unemployment attacks self-esteem and social status, elevating depression, drug use, alcoholism and suicide. Social services face fewer resources amidst exploding demand. So when people heard a candidate finally talk about their pain, and lambast American leaders for negotiating “bad deals,” they listened—and cheered.
St. Denis, Paris.
Writer Ben Judah takes a walk in a suburb transformed by immigration. Most residents are of North African, Arab and South Asian descent. Judah talks to a woman, Maria, emerging from a Catholic church there. “Immigration changed everything,” she tells him. “The French have all left Saint-Denis. Look around you.” Judah notes that “Since 2012, stabbings, shootings and car rammings have taken place every few months, punctuated by slaughters such as Charlie Hebdo and the Bataclan.” Immigrants themselves resent a thicket of regulations that keeps unemployment in their communities high; they suffer discrimination and anti-immigrant violence, and endure police harassment.
The scale of recent immigration to the United States and Europe has been massive. In the United States in 1970, the number of immigrants was 9.6 million (about 5 percent of the U.S. population). By 2015, this number had quadrupled to 43.3 million (13.5 percent of the population). Furthermore, the number of immigrants living illegally in the United States rose from 3.5 million in 1990 to about 11 million today.
Europe also recently experienced “one of the most significant influxes of migrants and refugees in its history.” In Britain after 1997, under Labour leadership, the country accepted twice as many immigrants than it had accepted over the previous fifty years. One wave of immigrants came from Eastern Europe after several countries there joined the EU in 2004. Europe accepted millions of refugees from Afghanistan, Iraq and Syria, with a massive spike in 2015.
Immigration on this scale has fueled concerns across Europe. One issue is economic effects; immigrant workers increase the tax base, but large numbers of low-skilled immigrants push wages downward and increase demand for social services (education and health care), and create future entitlements for health care and pensions. People also worry about greater violence. Crime rates remain generally low, but terrorist attacks, whether rightly or wrongly connected to immigrants, have created a strong sense of insecurity. As Pew Research Center finds, most Europeans (76 percent in Hungary; 61 percent in Germany; 52 percent in the UK) believe “refugees will increase the amount of terrorism in our country.”
Europeans are also concerned about integration. As Angela Merkel famously commented, in Germany, multiculturalism “utterly failed.” While the United States generally does better in this regard, in Europe immigrant communities tend to be insular, with people leading parallel lives. An unsettling number even hold values anathema to their societies; for example, surveys of Muslims in Britain and France have found that about a quarter favor the adoption of Sharia law in those countries.
Across Europe and the United States, these different concerns have unleashed a political backlash to immigration. Donald Trump emerged victorious in 2016 after a campaign dominated by promises to build a “big, beautiful wall.” Right-wing parties have gained influence in France, Germany and Sweden. And as seen most recently in the Austrian elections, in “middle Europe,” “increasingly, their dominant political sentiment is antithetical to, even contemptuous of, the liberal, pro-integrationist ideals of the European Union.”
Primrose Hill, London.
The lads—Americans, British, Japanese, and an assortment of other Europeans—are running football drills. As practice winds down, the dads (and occasional mom) arrive, watch the boys run around, and chat amiably. Most of them are in the finance industry; some are in the high-tech or entertainment fields. Amidst them appears the odd journalist (or, like my husband and me, academic).
Life is good. Our kids go to the same schools and New England summer camps. We went to the same universities. Do you know my friend Helen? She was at Berkeley/Yale/Chicago then. Let’s get coffee after you get back from Zurich and I get back from Dubai. They are clever, kind, great parents, globally minded. They are horrified at Brexit, appalled by Trump.
Those on the Primrose Hill football pitch are the winners of the liberal international order. Globalization has made their production costs plummet, their markets balloon, their profits soar. Since the 1980s, incomes for the top one percent of American households rose 275 percent. Even me, a mere academic on this “Fortune 500” sideline: universities are booming as their intellectual property is demanded by a larger market than ever before.
While fortune smiled upon Primrose Hill and other cosmopolitan enclaves, others suffered. Since 2000, real income for the American middle class is down 7.5 percent. Poorer Americans fared still worse; real incomes for the fourth quintile fell by 10 percent, and the bottom quintile was the hardest hit, with incomes falling by 16 percent.
At university, we learned about the enlightened liberal order that emerged out of the chaos of economic depression and war. We supported free trade because we knew the rising tide would lift all the boats; and because the spread of prosperity, freedom and human rights was good for the world. And over time we became increasingly isolated from, and even disdainful of, skeptics.
Views about immigration reflect perhaps the strongest divide. As Ross Douthat points out, in the United States, most voters either want immigration cut (35 percent) or kept at about the same level (38 percent). But U.S. leaders, rather than maintain or curtail immigration, have proposed amnesties for illegal immigrants, and recommended increasing the number of low-skilled immigrants.
British elites have been even less responsive to the public. “The chattering classes are still not too bothered,” writes Sir Andrew Green. “They like the cheap nannies, cheaper restaurants and lower inflation that the lower wages of immigrants bring.” In Britain, notes Schwarz, “a staggering 71 percent of the total voting-age population believe immigration is the most urgent problem facing the country; 76 percent want immigration reduced.”
When some people spoke out, the cosmopolitans were vexed that people could be so ignorant or so racist to oppose the liberal project. People favoring trade protectionism, lamented elites, don’t understand how much better off we are today! And opponents of immigration were racist. As Member of Parliament Clive Lewis said of British opposition to migration, “It’s ultimately about racism.”
Ignored and disdained by the cosmopolitans, publics responded with fury. Europeans voted for right-wing leaders. America Trumped. Britain Brexited. It wasn’t simply that voters disagreed with leaders. It was that they felt those leaders didn’t even represent them anymore—that they prioritized the liberal order above their own countrymen. As political scientist Leslie Vinjamuri argues of Brexit, “Leave” voters seemed angrier at London than they were at Brussels.
The spread of liberalism has been driving human progress for hundreds of years. Its reversal would indeed be disastrous: increased protectionism would erode prosperity and would harm consumers, and trade wars would curdle international politics. Fortunately, the backlash to the liberal order is less about its liberalism and more about its particular “order”—i.e., the specific rules and norms that have defined this manifestation of liberalism.
Over time, the order has bundled together numerous liberal doctrines—the free movement of goods, the free movement of people, the breakdown of sovereignty—and insisted that members accept them all. But members are pushing back. To maintain the order, its leaders must allow countries to choose the elements of the order that their people favor.
Embracing free trade need not require societies to accept other parts of the order: notably open immigration policies. Countries that want to make themselves into safe havens for refugees should be able to do so. But, as has been made perfectly clear, many European countries disagree with this as a mandate for the EU more generally.
After a long day at a conference about Japanese foreign policy, we are enjoying dinner. Some American professors are scolding our Japanese hosts for Tokyo’s failure to accept Syrian refugees. I listen, baffled and torn. One diplomat gently reminds the group about Japan’s generous aid to refugees; he gets back an earful about human rights and pulling one’s weight. The senior official hosting us listens intently but his eyes are weary. He’s torn too.
Liberalism transformed Japan after World War II. Its embrace of free trade and liberal institutions fueled the postwar recovery. But the transformation was always on Tokyo’s terms; Japan has always ordered à la carte off of the liberal menu. Japan’s economic model, for example, embraced profoundly mercantilist principles such as infant industry protection, subsidies and state-directed capital to favored industries.
In the United States and Europe, the backlash to the liberal order has come from people dislocated by globalization; from people concerned about the recent scale of immigration; and from people who felt that their elites had betrayed them. While Japan’s liberal partners convulse in populist revolutions, Japan remains calm. Why?
In Japan, leaders agreed to cut tariffs but its market remains far from open; a myriad of nontariff barriers continue to restrict imports. And for workers who were dislocated by trade, Tokyo upheld the social compact. “The Japanese government basically bought itself political stability,” writes commentator Yoichi Funabashi. “The social security budget has nearly doubled since 1990.”
Whereas in Europe and the United States cosmopolitan elites ignored the public’s desire to curb immigration, in Japan, the public’s skepticism about immigration translated into national policy. Strict immigration laws mean that only 1.5 percent of Japan’s population is foreign-born (most of them from Asian countries with linguistic and cultural similarities). As for refugees—the policy my colleagues were so exorcised about at dinner—in 2016 Japan accepted only twenty-eight refugees out of eleven thousand applications.
The Japanese value social harmony; leaders worry about integrating immigrants because of Japan’s unique culture and difficult language. While leaders understand the challenge of the low fertility rate and aging population, they have been cautious to see immigration as the remedy. As Prime Minister Shinzo Abe commented: “I would say that before accepting immigrants or refugees, we need to have more activities by women, elderly people and we must raise our birth rate.” Japan may someday move toward a more open immigration policy. Meanwhile, it offers a promising example of à la carte liberalism—of a country committed both to liberal values and to retaining its sovereignty.
While cosmopolitan Americans grieved on November 9, 2016, that Trump would ruin the liberal international order, the order was already straining under its own ambitions. A failure to take seriously the ideas behind this and other nationalist/populist revolutions will only empower another round of backlash, in which a more politically skillful and polished next generation could present a more formidable threat to the liberal project. After all, perhaps Ivanka (like Marine Le Pen) will someday sideline her inconvenient father. Meanwhile, the best way for the liberal order to survive is to listen to the people within it, who are tired of elites disdaining them while hoarding its gains.
Jennifer Lind is an associate professor of government at Dartmouth, and the author of Sorry States: Apologies in International Politics. Follow her on Twitter @profLind.
A previous version of this essay was published in Politique étrangère, Vol. 82, No. 4, Winter 2017-2018.