The political economies of different globalisations – Part 4: ‘Reglobalisation’

Matt Bishop - Research Fellow, SPERI & Senior Lecturer in International Politics, University of Sheffield

Tony Payne - Professorial Fellow, SPERI, University of Sheffield

Yet, as we’ve already said, globalisation does not have to be neoliberal globalisation.  Indeed, it is vital that, in future, it is not.  As the British journalist Paul Mason starkly put it after the Brexit referendum, ‘if we want to save globalisation, we have to ditch neoliberalism’.  In that article he focused on making the case for an alternative post-neoliberal economic model but didn’t address in detail what needed to be done at the global level of politics.  Nevertheless, the corollary of his argument is that globalisation also needs to be reformed, or controlled more, or steered better, however you prefer to put it – and, in effect, to be rebuilt around post-neoliberal values.  This is definitely possible theoretically, but is it realistic in the real world of political practice?

We suggest that there is actually a lot that ‘our’ states, acting on behalf of us as their citizens, can do collectively to reshape globalisation for the future into a different, and more attractive set of economic, social and political processes.  To quote John Hobson and M. Ramesh, ‘globalisation makes of states what states make it’.  States have acted previously to construct and adjust global orders, and this means that they can do so again.  In any case, it is always important in politics to try to imagine what else might conceivably be done, especially in political circumstances that appear dire at first sight.  So let’s be bold and begin to examine what an attempted reconfiguration of globalisation by our states around a different set of post-neoliberal values might look like and how it might be achieved.  We propose to describe this as a process of ‘reglobalisation’, of ‘redoing’ globalisation better.

In making this argument we build on insights from other analysts.  As long ago as 1997 the Harvard political economist Dani Rodrik famously asked in the title of a book Has Globalization Gone Too Far?.  By 2011 in The Globalization Paradox he was calling for ‘a sane globalization’ grounded in the tighter regulation of trade and finance and the proper management of labour flows.  He suggested that ‘we can and should tell a different story about globalization’.  Instead of taking the ‘hyper-globalisation’ line and 

viewing it as a system that requires a single set of institutions or one principal economic superpower, we should accept it as a collection of diverse nations whose interactions are regulated by a thin layer of simple, transparent, and commonsense traffic rules (p. 280).

Rodrik has continued to press these views right up to the present.

Eric Helleiner, in his account of The Status Quo Crisis (which is how he described the 2008 financial meltdown that didn’t change as much about global governance as many had initially anticipated), reinforced the same broad point by discerning, in his assessment of what could come next, a third scenario (between ‘strengthened liberal multilateralism’ and ‘fragmentation and conflict’) which he dubbed ‘cooperative decentralization’.  He was focusing on global financial governance and acknowledged that in this sphere states could continue to develop certain minimum international standards through the Financial Stability Bureau.  But he added a vital qualification: that, ‘rather than detailed one-size-fits-all rules, those standards could be based around broad principles that allowed significant national or regional policy space’ (p. 176).

Most recently, in a short book, The Globalization Backlash, published in early 2019, Colin Crouch has called ‘for moderate forces of left and right to stand together for a regulated globalization against xenophobic forces’ (p. 10).  He dismisses ‘the illusion of economic sovereignty’ and suggests that ‘it is far more constructive’ to work out how ‘in some policy fields’ this idea ‘needs to give way to one of pooled sovereignty in pursuit of a better transnational regulation of the globalized economy’ (p. 48).

These are all invaluable glimpses of what ‘reglobalisation’ has to be like (that is, sane, cooperative, decentralised, regulated), but they do not specify with enough precision the political bargain that necessarily has to underpin such a process if it is to gain ground and take off.  To frame this properly, we have to look back to look forward and recall the precise definition of the ‘embedded liberalism’ that John Ruggie defined as the key ingredient restored to the world economy at Bretton Woods in 1944.

As Ruggie saw it, the task at Bretton Woods was to manoeuvre between the extremes of both nationalism and liberalism and craft a ‘compromise’ (Ruggie’s telling but often forgotten word) that would ‘safeguard and even aid the quest for domestic stability without, at the same time, triggering the mutually destructive external consequences that had plagued the interwar period’.  In a key passage he went on to say this of his celebrated ‘embedded liberalism compromise’:

Unlike the economic nationalism of the thirties, it would be multilateral in character; unlike the liberalism of the gold standard and free trade, its multilateralism would be predicated upon domestic interventionism.

Ruggie’s analysis contains the clue that opens up the politics of ‘reglobalisation’.  We need to move now in 2019 to begin to chart a way towards what we describe as ‘re-embedded post-neoliberalism’.  In this framework of global governance states would again be permitted to pursue legitimate social purposes and enjoy the necessary national policy spaces to manage successfully their economic development in the context of a multilateralism that was necessarily liberal in character but ‘dialled down’ substantially in intensity from the excesses of the hyper-neoliberal era. 

It won’t be easy to engineer the stability, legitimacy and fairness that must be the essence of such a new global compromise, but there are lots of changes that can practically be made within global governance that would bring us nearer to this goal.  In due course another blog series will offer up some examples of ‘reglobalisation’ in action.