Search back through history and you’ll find polarising ideas drawing people into rival camps, settling their differences in the ballot box and the battlefield. Monarchism v. Republicanism tore England apart in our Civil War, culminating in Charles I’s beheading. Communism v. Capitalism splashed world maps with red and blue ink, placing East against West on the brink of nuclear Armageddon. Now another divide has opened, Globalism v. Nationalism. Two distinct visions of government that’ll invite people to pick a side.
Understanding what each means, identifying where leading figures stand, will give you an invaluable tool for making sense of our world. You’ll know why governments have acted the way they have and what they’re likely to do next. It’ll make a real difference when you plan for the future, giving you greater confidence in your decision making.
At the end of this post we've included a link to a quiz so you can find out for yourselves!
So, what is Globalism and how do I know if I'm a Globalist?
A Globalist’s eyes don’t see national borders. Taking the ‘world view’, their ideal is freedom of movement, for goods and services and people across borders. They favour international co-operation to realise it. This takes several forms and involves ‘supranational’ organisations standing above the fray of individual nation-states. The trend towards greater integration, with greater trade and travel and sharing of culture, is what is known as ‘Globalisation’.
Free trade agreements (FTAs) are one way barriers to the free flow of goods and services have been lowered. These are treaties between countries that reduce import and export tariffs, taxes set by countries on foreign products that enter them and domestic ones that leave. They also aim to iron out differences in countries’ regulatory standards, so complying with those in yours is more likely to comply with another’s, saving time looking up and applying different rules. FTAs also look to increase business investment between their signatories. An example of an FTA is the North American Free Trade Agreement (NAFTA) between Canada, Mexico and the United States.
The dream of freedom of movement has been realised most fully by the European Union (EU), a supranational organisation that perhaps best embodies Globalism. If you found yourself entering an EU country in its ‘Schengen Area’, for example, you would scarcely notice. Other than a welcome sign, you wouldn’t have to produce a passport or any other form of documentation. Want to work in another EU state? Your right to do so is guaranteed by treaty. And the Euro means you needn’t swap exchange currencies within the Eurozone.
OK, so what is a Nationalist?
For the Nationalist, the nation-state comes above all else. Countries should be governed so their interest, of their citizens and their industry, comes first. To be free to place themselves first, they must be sovereign, or able to act without a higher authority over-ruling them. Because organisations like the EU and United Nations (UN) act in this way, they tend not to favour membership of such bodies.
This isn’t all. For Nationalists, nations are identified by a unique culture, a distinctive set of customs and shared history. Nationalists argue that this helps bind society together. It is also why they resent the import of foreign media and mass immigration brought about by Globalisation, as both threaten to erode national identity. A fragmented country, with rival cultures and competing loyalties, is a real danger to a Nationalist.
Economically, in contrast to free trade, Nationalists are keen to shield native industries from ‘unfair’ foreign competition. Known as protectionism, they will charge tariffs on foreign goods and do their utmost to prevent domestic firms from relocating, or outsourcing, elsewhere where running costs may be lower. It’s for this reason Nationalists like Donald Trump point to the Rust Belt in the U.S., where factories have closed and unemployment is high, as a victim of Free Trade Agreements in general and the NAFTA in particular. Products bearing ‘Made in America’ labels on American shelves are, to President Trump, a source of pride. While ‘Made in China’ stamps are a cause of woe.
Standing against unlimited immigration, the current President's Nationalist philosophy will deliver a very different situation at the U.S.-Mexican border to that at the Franco-German one. Instead of the Schengen Area’s open borders, President Trump has pledged the building of an “impenetrable, physical, tall, powerful, beautiful, southern border wall” to physically stop free movement. And if you want to work in the U.S., you will soon require certain, specific, skills to fill gaps in its labour market. So whilst that will be fine for Liam Neeson, the rest of us may find our options more limited. There is not now, nor will there be, an automatic right to work in the U.S.. Mexcians will also be swapping Pesos for Dollars for the foreseeable future. Nationalists view supranational currencies, like the Euro, as a surrender of sovereignty since belonging to a shared currency leads to less control over interest rates, inflation and many more fiscal elements.
What does this mean for me?
As in other areas of life, it’s good to view the Globalist / Nationalist divide as a spectrum, from black to white with shades of grey in-between. Few want to be totally open or totally closed.
On the one hand, Nationalists view the EU as heading down an inevitable path in which its members are incorporated into a single United States of Europe, but the EU still lacks many of the trappings of a nation-state, including an army, and even the Eurozone crisis didn’t get it to agree a common budget like other currency unions.
On the other hand, while the Brexit vote was a rejection of the EU’s freedom of movement, it was emphatically not a demand for Britain to become protectionist. The UK Government is seeking to keep tariffs to a minimum, and investment opportunities high, with an EU FTA. And has established the Department for International Trade as an engine for signing new FTAs across the world, from China to Chile. Trump’s protectionist U.S. might well be the first, rather than the EU, to do a deal with us.
Immigration is where the recent drift towards Nationalism, away from the Globalism that has predominated since the Second World War, is most likely to make a difference. Here arguments, about its economic, cultural and security impacts rage most fiercely. Here the pressure is strongest for politicians to back away from open borders.
In the UK, while we still don’t know what will ultimately happen with Brexit, it’ll likely mean that although current EU nationals working here can stay, future migrants will have to meet more stringent requirements before taking up jobs. Instead of doing anything, they’ll need certain skills to undertake certain jobs where there’s a labour shortage, such as being an NHS doctor.
A sense of déjà vu
History doesn’t march in one direction – Globalisation wasn’t inevitable and wasn’t going to continue forever. We've seen movements towards openness reverse after great upheaval in the past. The Great Recession is simply the most recent example of this. It happened because of the ‘Long Depression’, twenty years of low growth in the late 19th century, and it happened after World War One. America's involvement in that conflict and the their view on how it impacted the world led to them refusing to join the League of Nations. It also saw the US tighten trade and immigration rules significantly in the 1920s.
When old debates about the pace of change are revisited, and the world looks more uncertain, it makes sense to focus on being as efficient as possible. To make every pound, dollar, euro or peso go that much further so you can focus on beating your competition. When you’re facing times like these, it makes sense to try Khaos Control Cloud, the ERP on the Go solution that lets you control your business chaos – wherever there’s an internet connection.
And, as I promised at the start of this piece, here's that quiz, which are you?
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