By Dr. James Kahn
Henry and Bertha Kressel University Professor of Economics; chair of the department of economics at Yeshiva College; professor in the MS in Quantitative Economics program at the Katz School of Science and Health
In the late 20th and early 21st century, with the Maastricht Treaty that established the European Union and the free trade agreements in North America, globalism was ascendant. However, recent years have seen a resurgence of nationalism, as exemplified by the Brexit vote in the United Kingdom and by the elections of Donald Trump in the United States and, more recently, Jair Bolsonaro in Brazil.
The World Economic Forum (WEF) Annual Meeting took place in Switzerland from January 22 to January 26. The WEF has been a symbol of the globalism movement and, consequently, a target of forces opposed to globalism that fall under the rubric of nationalism. The key areas of conflict between these two ideologies, and the main themes discussed throughout the week, can be categorized as Immigration, Trade, Environment, and Sovereignty.
Globalists favor freedom of immigration, which means both the less controversial freedom to emigrate and the more controversial obligation to accept immigrants. Nationalists emphasize the importance of control over borders and the potential adverse impact of uncontrolled immigration on national identity, culture and security.
Globalists emphasize the economic benefits of free trade. Nationalists stress the impact on those industries and workers adversely affected by free trade as well as concerns about intellectual property theft and national security.
Globalists support coordinated action on environmental policies such as reduction of carbon emissions. Nationalists may be skeptical of the costs and benefits of these policies, or believe that their countries will bear a disproportionate share of the burden.
Globalists believe that cooperation via international institutions and agreements is the best way to approach the first three issues. Nationalists are suspicious of such cooperation; they see the institutions as arrogant, power-hungry and inimical to national sovereignty, and they are suspicious of complex agreements as disguising hidden agendas and prone to unintended consequences.
Presenting these issues as a unified platform, which both ardent nationalists and the pro-globalist WEF tend to do, may undermine progress on specific issues, however.
For one thing, as they say on Sesame Street, “one of these things is not like the other”: It is possible to be a globalist in matters of trade while nonetheless recognizing nationalists’ concerns in the other areas. Immigration policy does raise valid issues of national identity, culture and security. There are also legitimate disagreements regarding environmental problems, both in their nature and how best to ameliorate them. And yes, an international organization can, like any other governing organization, grow out of control and may have a tendency to impose one-size-fits-all solutions.
Few of these concerns apply to international trade. While the free flow of goods and services may have some cultural impact, automobiles, circuit boards and appliances have no ideology, religion or behavior, and they do not vote, commit crimes or even alter a culture that is not already under transformation.
And while it is true that there are winners and losers from free trade, there are also winners and losers from barriers to trade. Economists have understood for more than two centuries that the gains from trade are bigger than the losses.
There are exceptions, of course: Goods may embody intellectual property, which may be “stolen,” or in the case of weapons or military technology have national security risks. But these cases do not provide a broad justification for protectionism.
One should not have to choose sides between globalism and nationalism on all issues. Just as it is a mistake for globalists to link free trade with open borders and international institutions, it is a mistake for nationalists to link their concerns about immigration and sovereignty to free trade. Nations and tribes have traded with each other for millennia without surrendering their culture or security.