Sixty years ago, U.S. policymakers confronted an unimaginable series of global crises. They saw the enormity of the task before them as “just a bit less formidable than that described in the first chapter of Genesis. That was to create a world out of chaos; ours, to create half a world, a free half, out of the same material without blowing the whole to pieces in the process. The wonder of it is how much was done.”1 Articulating an inclusive vision of a democratic and prosperous order for friends and former foes alike, the U.S. government marshaled the imagination, resources, and stamina to spearhead the formation of institutions that brought democratic stability and prosperity to allies in Europe and Asia. The critical task now, however, is to articulate a vision for the entire world.
Globalization reveals the liberating potential of the market for generating unlimited wealth and its blindness as a mechanism for distributing the consequences of this wealth. If world prosperity and security depend on leading the process of globalization toward producing equal opportunity, then creating mechanisms through which all people can participate in global prosperity must move to the forefront of the international agenda. Without such a strategy, there is a risk that the current wave of globalization might fail, a risk that has not been sufficiently emphasized. The United Nations’ report of the High-Level Panel on Threats, Challenges and Change, for example, is silent about this risk.2
Although the possibilities of wealth creation have become truly limitless, four billion people are left out of the process and still deal with medieval standards of living. With the globalization of television, the images of the good life that people watch and to which they aspire are those of the middle and upper classes of Organization for Economic Cooperation and Development (OECD) countries. Expectations are now set in terms of global standards rather than national realities. The social compact reached in OECD countries that made stability possible in the mid-twentieth century, which invested in education for the young and safety nets for the old, disabled, and unemployed, is now under threat of being shattered by the failure to deal with the social debris of globalization.
The 1990s saw the emergence of a rare consensus on democracy as the organizational form of governance and the market as the organizational form of the economy. This was a monumental shift after several hundred years of debate about authoritarianism and state-led paths of development. Yet, there are now increasing signs of dissent from Latin America to France to the current Maoist threat in Nepal and India, ranging from disenchantment to outright rejection of the potential of market-based solutions to deal with inequality or protect the gains of the welfare state. Economics is global, but politics is national, making for a constant disconnect between what politicians judge to be feasible in the short term and what is necessary for collective well-being in the medium to long term. In reaction to globalization, issues are being defined reactively in national terms, resulting in a lose-lose proposition instead of harnessing and leading globalization toward global prosperity. The international regimes for dealing with intellectual property rights and management of international currency relationships, for example, are becoming increasingly contested. Some governments are either actively colluding with or outright protecting local industries that violate intellectual property rights, thereby requiring huge investments from global firms in protecting their brands.
The risks involved are not limited to the extreme case of the second collapse of globalization. Already, the criminalization of economies in many countries is perversely connected to globalization, enabling nimble criminal networks to take advantage of liberalization and deregulation.3 Criminality is expanding as rapidly as the productive networks of globalization, and many people as well as governments have become enmeshed in networks dealing in illicit activities such as the transport of pirated software, money, drugs, prostitutes, and immigrants.4 These global criminal networks connect easily into networks of terror.5
Just as there was in 1945, there is now an open historical moment that contains the opportunity for ordered liberty or the threat of descent into prolonged crisis. Today, there is a need for new rules regarding the state, the market, and global institutions to respond to the challenges of globalization.