• Chris Clarke

Mistaking change for loss

Updated: Dec 28, 2018

Below is an extract from Chapter Fourteen of Warring Fictions. This comes from the section of the book about alternative narratives to the Golden Era. It describes the Isolation to Interconnectedness shift.

i. Isolation to Interconnectedness

One question never pondered by left populists is why, if we’ve drifted so far towards conservatism, many on the right believe Golden Era narratives of their own. Mail columnist Peter Hitchens, for example, claims David Cameron ended up having “more in common with the Socialist Workers’ Party” than with conventional Tories.[i]


This isn’t uncommon among right populists. It encompasses a sense of decline about the rise of human rights, the preoccupation with the environment, the loss of Britain’s place in the world, and ‘over-compensation’ on race and gender. It extends to economics, too. Right populists say we’ve moved towards an overgenerous welfare system, an oversized state, an over-willingness to ‘blame society’, excessive international aid, and regulations that suffocate enterprise. We only need to look at the Tea Party’s obsession with the country’s ‘socialised’ healthcare to see this.


If the right has won so comprehensively then why aren’t they more triumphant? And if they’ve lost then why aren’t we on the left happier? Both Golden Era narratives cannot be correct. The reality is that – rather than a shift to left or right – a move from isolationism towards interconnectedness has changed the parameters. The mobility of big business, for example, has meant governments increasingly placate rather than tax large multinationals. Left populists see this as proof of a rightward shift sweeping all before it. But, on the other side of the ledger, the shift towards internationalism has meant acquiescence to Human Rights rules or global emissions targets. Right populists treat these as wholesale capitulations.[ii] For instance, Trump’s slogan was ‘Make America Great Again’, and his supporters suggested that RINOs (‘Republicans in Name Only’) had taken over the party and surrendered its original purpose.

The table above sets out the key oppositions. And the visualisations below show how left and right have had their wings clipped by the Isolation to Interconnectedness shift. The horseshoes in each represent the political spectrum at different points. The blue and red perimeter lines show the limitations that an interconnected world has imposed on left and right respectively. Some of the changes are practical, while others relate to social norms changing, thanks to contact with other cultures.


The first, Diagram 1, shows the political horseshoe at a relatively early stage – as it might have been several decades ago.

In essence, progressive and conservative governments alike have had their room for manoeuvre altered, by a world where borders matter less. Populists on both sides are reluctant to think through the challenges of an interconnected world, instead arguing that their opponents have been 100% triumphant.


Indeed, there is little acceptance, among populists, that there’s any give-and-take at all between left interconnectedness and right interconnectedness. Most believe you can choose one without the other.[iii] Left populists, for example, argue that government policies can be fundamentally pro-migrant but staunchly anti-business; socially liberal but economically protectionist; internationalist but anti-globalisation.[iv]


Forced to choose, isolation is often the populist backup. And, as a result, left populists end up taking insular stances, or inadvertently collaborating with the hard right. The cooperation with Enoch Powell in the 1975 European referendum was an early instance of this. Labour’s current opposition to freedom of movement is a modern example.[v]

The reality is that it’s hard to contribute to peace in Syria, or to build a consensus on climate change, while refusing to trade with other countries. Likewise, it’s difficult to travel widely as a population – or to accept more migrants and refugees – if you have a siege economy. And it’s almost impossible to square the fall in prosperity that protectionism would bring with Britain remaining a country that foreigners want to visit or live in. Similarly, multilateral solutions to inequality (a Robin Hood Tax, for example) won’t get far if you simultaneously withdraw from multilateral platforms like NATO.[vi]


The same goes for the spread of social reforms (on capital punishment, abortion, or LGBT rights). These occur much faster in a world where progressive steps are visible and replicable to other nations. They’re less likely if there’s no integration between countries. This is part of the reason why internationalism and social liberalism go hand-in-hand.


Humanitarian intervention is another example. The left’s foreign policy outlook is premised on an age with no ‘international community’, when countries were self-contained, self-interested entities, only interacting to acquire territory. But what should the policy on intervention be in a world where colonial arguments have been largely beaten – where our instinct is to help not plunder? What should we do – as an interconnected nation whose destiny is bound up with other nations – when we see foreign crises on our TV screens? The answer clearly can’t be either blanket intervention or blanket non-intervention. Yet left populists find it easier to sit back on assumptions from the isolationist era, blaming ‘Western Imperialism’, than to think through these questions.


This isn’t to say an uncritical embrace is the only way of adapting to the Isolation to Interconnectedness transition. There are different ways of striking the balance between internationalism and globalisation. But it’s hard to imagine a country rejecting every tenet of free trade and global capitalism, while also being a beacon of ‘one world’ tolerance.[vii]


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Diagrams 2-5, below, show the implications of the Isolation to Interconnectedness shift over time. Diagram 5 shows the conventional spectrum turned on its head, with ‘open versus closed’ replacing ‘right versus left’. [viii]

We saw this in France’s 2017 Presidential run-off, where the mainstream left and the mainstream right were swept aside. The final ballot was between an all-out internationalist globalist (Macron) and an all-out nationalist protectionist (Le Pen).[ix]


In the UK we’re closer to a Diagram 3 or 4 scenario, largely because both main parties are under isolationist leadership. Anti-immigrant, pro-sovereignty Brexiteers set the Conservative agenda. Anti-interventionist ‘Lexiteers’ set Labour’s.


Nevertheless, Isolation to Interconnectedness is just as significant in Britain. In the last few years both Labour and the Tories have been constantly on the verge of splitting, the fault-lines being between isolationism and interconnectedness.[x] Populists are in the isolationist camp and pluralists are in the interconnectedness one – with the latter telling the former that they can’t choose only the aspects of interconnectedness that they like. Brexit has tended to be the battleground for this, but the tensions run deeper.[xi]


The issue isn’t just that rejecting globalisation means rejecting many aspects of internationalism (or vice versa, if you’re on the right). It’s also that a successful economy is almost impossible without accepting the shift towards an interconnected world.


The centre right, for instance, has historically advocated mild nationalism and social conservatism, alongside market-based economic pragmatism. But Brexit renders these things irreconcilable.


Meanwhile, the centre left ideal is to combine a strong economy with radical redistribution – growing the pie but splitting it as you do, so that the wealth is shared. Yet Isolation to Interconnectedness means this social democratic formula – always reliant on a balancing act[xii] – has come to feel like a zero-sum choice: a strong economy or an equal one. In a globalised context, the pursuit of growth often means bigger and bigger concessions, to attract investors who are indifferent to borders.[xiii]


This creates accusations of a race to the bottom. If we look at the steady reductions in UK corporation tax, we can understand why many fear that the pursuit of investment brings diminishing returns.[xiv] Indeed, corporation tax has fallen dramatically in almost every OECD country, largely thanks to the Isolation to interconnectedness transition.


Labour is thus torn between growers of the pie (who point out the hardship of recession and the investment in the poorest that even modest growth can bring), and splitters of the pie (who point out that equality is the abiding goal of the left). How do we deal with Isolation to Interconnectedness without sacrificing equality in return for growth? Would we prefer a nation with affluent CEOs whose taxes pay for new schools, or one with less CEOs and less new schools?[xv] These zero-sum choices cut down the middle of Labour, and there are respectable arguments on both sides. Corbyn supporters should be honest that their politics will harm prosperity. His opponents should concede that their politics means inequality can only be tackled gradually.


In truth, there’s a desperate need for interconnected responses to an interconnected world. If Europe could act as one then wealth inequalities could be addressed.[xvi] Yet the problem is that the populist left – even if correct in some of its diagnoses – has consistently favoured the solutions of an isolationist age.


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Arguments about whether ‘open versus closed’ has replaced ‘left versus right’ have rumbled for years.[xvii] It’s often pointed out, for example, that young people tend to be economically and socially liberal, compared to older, ‘closed’ generations.[xviii]


Indeed, some left populists accept parts of the Isolation to Interconnectedness shift, but find ways of shoehorning it into the Golden Era narrative. Progressives who work with the Isolation to Interconnectedness shift are caricatured as pro-globalisation ‘centrists’ and rootless jet-setters. (Those who define as ‘centrist’ sometimes play into this, giving the ‘end of history’ impression that they see interconnectedness is a goal in itself).[xix]


Hence, despite there being a complex trade-off between progressive and conservative parts of Isolation to Interconnectedness, the shift is seen by the populist left as a right-wing phenomenon and a sign that we’ve lost.[xx]


In reality, although interconnectedness has narrowed the room for manoeuvre, there are still big differences between how centre left and centre right parties deal with interconnectedness – on questions of spending or redistribution, for instance.


Moreover, the narrowing of the parameters is a bottleneck, not a permanent state-of-affairs. It’s mainly happened because we’re at a halfway point in the Isolation to Interconnectedness shift – experiencing the downsides of developments like fluid capital, without yet being interconnected enough to solve them supra-nationally. The left needs to help build more transparent and democratic international structures, so we can push to the next stage.


As the final visualisation, Diagram 6, anticipates, if and when this happens the present horseshoe will basically reverse. Clear blue water will open out between the internationalist left and the globalist right, as core values re-assert themselves and real debates – like the rate at which an EU-wide corporation tax should be set – take hold. Meanwhile, isolationist populists of left and right will increasingly overlap.


Hence, while support for a ‘centrist’ coalition of internationalists and globalists may be an effective short-term tactic against Brexit, it isn’t a sustainable platform. There are few policies that could fulfil, in the long-term, the ideals of both pluralist left and pluralist right.[xxi]


The answer is to embrace and shape the transition as a left-wing one, bending it towards a form of interconnected socially democracy, with global capitalism regulated and wealth redistributed by transnational institutions. The chief difference on the left is between international socialists who think this is desirable and possible, and domestic socialists who – often suspicious of ‘world government’ for Puppet Master reasons – believe that left-of-centre values must be enacted in isolation.

Of course, both the pluralist left and the populist left see themselves as striving for a politics which is egalitarian and internationalist.[xxii] So, perhaps a truer description is that the pluralist left see internationalism as the route to egalitarianism, whereas the populist left see egalitarianism as the route to internationalism. Someone like David Miliband would tend to favour a fully interconnected world, where you can start to tackle wealth inequality in a joined-up way,[xxiii] whereas someone like John McDonnell would favour creating a truly equal country, which you can replicate elsewhere. The former approach makes more sense to me.


But either way, the Isolation to Interconnectedness shift means there’s no perfect strategy for pursuing both egalitarianism and internationalism, without budging an inch on either.


Notes

[i] Hitchens has made this claim both in interviews and in print, writing, for example, ‘Labour has a real lefty...so can we have proper conservatives?’

[ii] Dominic Sandbrook, in an RSA lecture on life in the 1970s, describes the changes that have occurred. He reminds us that the 1970s was a time where coal, rail, telecoms, gas, electricity and transport were nationalised, but also one where Enoch Powell was voted Britain’s most popular politician, and where Alf Garnett told television audiences we should “put the coons down the pits.”

[iii] Ken Loach pointed out in 2013 that in the 1940s there weren’t immigrants to blame. But he frames this as though we’ve somehow seen a drift to the right since this era, because the possibility for racism has been opened up by immigration.

[iv] Richard Carr argues that the populist left’s stance is based on a paradox between openness and closedness: a pretence that we can be socially open but economically closed, which in itself creates an impossible conundrum.

[v] Despite Corbyn being socially liberal and pro-refugee, the realities of Labour’s protectionist policies ultimately meant the pulling up of the drawbridge on all fronts. The party’s opposition to freedom of movement made the 2017 manifesto its most anti-immigrant in many years. A more pronounced example from the left is the TSSA trade union’s release of a video, circulated by Momentum, which blamed privatisation of the rail system on foreigners. Meanwhile many left populists – such as Paul Mason or Liam Young – have opposed freedom of movement, with Mason advocating a “10-year, temporary suspension.”

[vi] As Steve Bloomfield points out, the real life implications of would probably be that Britain stood on the side lines as crises unfolded – less likely to do harm, perhaps, but also less able to do good.

[vii] The countries which have advocated true socialist isolationism – like North Korea, Cuba or, historically, Albania – are also countries with high levels of social conservatism, poorly travelled populations, and inadequate civil rights. In some cases, such as with Cuba, the decisions taken make sense in the context of the alternatives faced. But it’s still hard to find examples of protectionist socialism that fulfil the modern left’s expectations about tolerance and openness.

[viii]As the academic Jan Rovny writes for the Social Europe website, “Transnationalism associates cosmopolitanism with open economic exchange on the one side, and national traditionalism with economic protectionism on the other. In doing so, transnationalism effectively shatters the old electoral coalition of the left. The naturally protectionist workers are pulled away from the naturally cosmopolitan intellectuals.”

[ix] Macron was a socially liberal, pro-EU, pro-migrant, free trade global capitalist, whereas Le Pen was Eurosceptic, protectionist, statist, nativist, and supportive of fairness within strict borders.

[x] Research by the Bright Blue think tank shows the markedly different attitude of sub-sets of Tory voters, with Tories who voted for the party in 2010 but not 2015 taking markedly more hostile attitudes to immigration than those who voted Tory in 2015 but not 2010. ‘A balanced centre-right agenda on immigration: Understanding how Conservative voters think about immigration’, Bright Blue, Ryan Shorthouse and David Kirkby, 2015.

[xi] The voting behaviour of Labour Leavers and Tory Remainers at the 2017 election showed how these new fault-line are shaping politics. There were high numbers of switchers in these two groups – with social values trumping economic ones for the first time. Labour, in particular, finds its broad church divided: between cosmopolitans and communitarians; between liberals and authoritarians; between supporters and opponents of immigration; between Remain- and Leave-leaning voters; between those who seek economic protection and those who want cultural protection, etc. As Will Brett puts it, “The new social cleavage runs clean through [Labour].” YouGov polling corroborates much of this, finding a divide between those who want to see Labour as a socially conservative ‘workers’ party’ and those who want to see Labour become a liberal left party based on worldwide equality. Added to this there’s a policy divide as a result of growing interconnectedness: between the hard left and just about everyone else. Whereas the latter are ardent Remainers, the former make the Lexit argument for leaving the Single Market, making the largely baseless argument that EU laws stop Labour implementing its manifesto.

[xii] Forty years ago, in a world less interconnected today’s, the mobility of wealth was already an issue. Labour spent years attempting, unsuccessfully, to introduce a wealth tax unilaterally. Howard Glennerster, the author of a LSE study into why it failed, wrote that: “How far is any radical change in the pattern of economic rewards feasible in a modern mobile interdependent economy? The archives show how much this exercised the Treasury in 1974 long before capital, human and financial, was as mobile as it is today.” A few years later, in 1981, French President Francois Mitterrand saw several billion dollars leave the economy when he attempted to introduce a wealth tax. As others point out, the modern economy is “far more globalised than in the 1980s,” with businesses like Google often channelling funds through several different low tax economies as a matter of course.

[xiii] The indifference to borders applies to the wealthiest individuals, too. Evidence from 2006 France and 2009 Britain suggests that even modest tax increases can lead to departures. This may be overblown when the taxes are lower level. But very high taxes on high net worth individuals – at the level required to make a difference to the public finances – would surely be susceptible to capital flight.

[xiv] The UK corporation tax main rate fell from 28% in 2010 to 23% by 2013, and then down to 19% by 2017. It had previously fallen from 40-50% in the mid-1960s to 35% in the mid-1980s, and continued to be reduced during the rest of the Thatcher-Major era. Most OECD countries in Europe have corporation tax rates of 20-25%. These rates have fallen dramatically since the early 2000s, with the UK corporation tax level above the OECD rate for much of the 2000s. The US is, curiously, an outlier, with a corporation tax rate higher than most of Europe. It’s arguably the exception that proves the rule, with America’s lack of neighbours (i.e. its comparative lack of financial interconnectedness) allowing it to maintain its high levy. Canada’s very low rate (15%) perhaps reflects an effort to attract countries that might otherwise base themselves in the US.

[xv] When Labour’s 2017 manifesto was leaked, an article by Robert Peston summed up this dilemma, writing that, in a context of high capital flight, the ‘controversy’ would be “whether Labour’s programme would in practice harm the private sector, which ultimately pays for our public services – and lead to a significant increase in the indebtedness of a relatively highly indebted state, well beyond what Labour forecasts, believes and hopes.”

[xvi] The EU was already doing this in many cases, such as with its Anti Tax Avoidance Directive, AIFMD regulations, plans for an EU-wide transaction tax and its regional development fund. And there are ways to go further. An EU-wide corporation tax, for example, would be an interconnected rather than isolationist solution to the above issues. Yet this would involve years of being at the forefront of the European project to achieve.

[xvii] Tony Blair made this point many years ago, and others have said the same thing. As early as 2005 the ‘drawbridge up versus drawbridge down’ analysis was being made, and events like Brexit and the election of Trump have cemented the idea. Immigration debates have led to new distinctions between ‘cosmopolitans versus communitarians’ and between ‘somewheres and anywheres’.

[xviii] In 2013 data showed that British 18-24 year-olds are the most socially and economically liberal generation there’s been. Polling in the US suggests that the youngest cohorts there are also “socially liberal but fiscally conservative.” Meanwhile, YouGov find that age is now a chief dividing line.

[xix] There have been various examples of this, including former Tory advisor James Chapman creating ‘The Democrats’ (which described Thatcher, Major and Blair as interchangeable ‘centrists’), and the businessman Simon Franks’ Project One Movement.

[xx] It’s interesting that the rise of right-wing isolationist populism is seen by left populists as a product of ‘neoliberal’ drift. When Nazi demonstrations took place in Charlottesville, for example, the likes of Laurie Penny argued that ‘centrists’ had created it. In reality, the Trump and Brexit doctrines of protectionist nationalism are closer to ‘socialism in one country’ than they are to globalised internationalism.

[xxi] Indeed, even if we look at two of the most overtly ‘centrist’ Labour figures in modern times, Tony Blair and David Miliband, we still see a desire to bend the direction of the interconnected world towards social democratic values. Blair talks of the importance of interconnectedness in addressing climate change and creating better regulatory frameworks for finance. He points out that Brexit “will not mean more money for the NHS but less… It will not mean more protection for workers, but less.” David Miliband argues that the EU is a potential vehicle to “protect citizens from the risk of market excess, including in the financial sector.” Both frame the EU as a means of creating social democratic protections using multilateral techniques. And for both, internationalising even further represents the way through the Isolation to interconnectedness shift – hence their dismay at the huge step back that Brexit represents.

[xxii] Many supporters of Corbyn have criticised his opposition to free movement, through public statements and open letters. They perhaps hope that Corbyn will renege his position on this if in office.

[xxiii] Thomas Piketty makes this argument more forcefully and specifically, and has long advocated a progressive global wealth tax.

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