Why This Crisis Is A Turning Point In History

The era of peak globalisation is over. For those of us not on the front line, clearing the mind and thinking how to live in an altered world is the task at hand…

The deserted streets will fill again, and we will leave our screen-lit burrows blinking with relief. But the world will be different from how we imagined it in what we thought were normal times. This is not a temporary rupture in an otherwise stable equilibrium: the crisis through which we are living is a turning point in history. 

The era of peak globalisation is over. An economic system that relied on worldwide production and long supply chains is morphing into one that will be less interconnected. A way of life driven by unceasing mobility is shuddering to a stop. Our lives are going to be more physically constrained and more virtual than they were. A more fragmented world is coming into being that in some ways may be more resilient.

The once formidable British state is being rapidly reinvented, and on a scale not seen before. Acting with emergency powers authorised by parliament, the government has tossed economic orthodoxy to the winds. Savaged by years of imbecilic austerity, the NHS – like the armed forces, police, prisons, fire service, care workers and cleaners – has its back to the wall. But with the noble dedication of its workers, the virus will be held at bay. Our political system will survive intact. Not many countries will be so fortunate. Governments everywhere are struggling through the narrow passage between suppressing the virus and crashing the economy. Many will stumble and fall.

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In the view of the future to which progressive thinkers cling, the future is an embellished version of the recent past. No doubt this helps them preserve some semblance of sanity. It also undermines what is now our most vital attribute: the ability to adapt and fashion different ways of life. The task ahead is to build economies and societies that are more durable, and more humanly habitable, than those that were exposed to the anarchy of the global market.

It does not mean a shift to small-scale localism. Human numbers are too large for local self-sufficiency to be viable, and most of humankind is not willing to return to the small, closed communities of a more distant past. But the hyperglobalisation of the last few decades is not coming back either. The virus has exposed fatal weaknesses in the economic system that was patched up after the 2008 financial crisis. Liberal capitalism is bust. 

With all its talk of freedom and choice, liberalism was in practice the experiment of dissolving traditional sources of social cohesion and political legitimacy and replacing them with the promise of rising material living standards. This experiment has now run its course. Suppressing the virus necessitates an economic shutdown that can only be temporary, but when the economy restarts, it will be in a world where governments act to curb the global market.

A situation in which so many of the world’s essential medical supplies originate in China – or any other single country – will not be tolerated. Production in these and other sensitive areas will be re-shored as a matter of national security. The notion that a country such as Britain could phase out farming and depend on imports for food will be dismissed as the nonsense it always has been. The airline industry will shrink as people travel less. Harder borders are going to be an enduring feature of the global landscape. A narrow goal of economic efficiency will no longer be practicable for governments.

The question is, what will replace rising material living standards as the basis of society? One answer green thinkers have given is what John Stuart Mill in his Principles of Political Economy (1848) called a “stationary-state economy”. Expanding production and consumption would no longer be an overriding goal, and the increase in human numbers curbed. Unlike most liberals today, Mill recognised the danger of overpopulation. A world filled with human beings, he wrote, would be one without “flowery wastes” and wildlife. He also understood the dangers of central planning. The stationary state would be a market economy in which competition is encouraged. Technological innovation would continue, along with improvements in the art of living.

In many ways this is an appealing vision, but it is also unreal. There is no world authority to enforce an end to growth, just as there is none to fight the virus. Contrary to the progressive mantra, recently repeated by Gordon Brown, global problems do not always have global solutions. Geopolitical divisions preclude anything like world government. If one existed, existing states would compete to control it. The belief that this crisis can be solved by an unprecedented outbreak of international cooperation is magical thinking in its purest form.

Of course economic expansion is not indefinitely sustainable. For one thing, it can only worsen climate change and turn the planet into a garbage dump. But with highly uneven living standards, still rising human numbers and intensifying geopolitical rivalries, zero growth is also unsustainable. If the limits of growth are eventually accepted, it will be because governments make the protection of their citizens their most important objective. Whether democratic or authoritarian, states that do not meet this Hobbesian test will fail.

The pandemic has abruptly accelerated geopolitical change. Combined with the collapse in oil prices, the uncontrolled spread of the virus in Iran could destabilise its theocratic regime. With revenues plunging, Saudi Arabia is also at risk. No doubt many will wish both of them good riddance. But there can be no assurance that a meltdown in the Gulf will produce anything other than a long period of chaos. Despite years of talk about diversifying, these regimes are still hostages of oil and even if the price recovers somewhat, the economic hit of the global shutdown will be devastating.

In contrast, the advance of East Asia will surely continue. The most successful responses to the epidemic thus far have been in Taiwan, South Korea and Singapore. It is hard to believe their cultural traditions, which focus on collective well-being more than personal autonomy, have not played a role in their success. They have also resisted the cult of the minimal state. It will not be surprising if they adjust to de-globalisation better than many Western countries.

China’s position is more complex. Given its record of cover-ups and opaque statistics, its performance during the pandemic is hard to assess. Certainly it is not a model any democracy could or should emulate. As the new NHS Nightingale shows, it is not only authoritarian regimes that can build hospitals in two weeks. No one knows the full human costs of the Chinese shutdown. Even so, Xi Jinping’s regime looks to have benefited from the pandemic. The virus has provided a rationale for expanding the surveillance state and introducing even stronger political control. Instead of wasting the crisis, Xi is using it to expand the country’s influence. China is inserting itself in place of the EU by assisting distressed national governments, such as Italy. Many of the masks and testing kits it has supplied have proved to be faulty, but the fact seems not to have dented Beijing’s propaganda campaign.

The EU has responded to the crisis by revealing its essential weakness. Few ideas are so scorned by higher minds than sovereignty. In practice it signifies the capacity to execute a comprehensive, coordinated and flexible emergency plan of the kind being implemented in the UK and other countries. The measures that have already been taken are larger than any implemented in the Second World War. In their most important respects they are also the opposite of what was done then, when the British population was mobilised as never before, and unemployment fell dramatically. Today, aside from those in essential services, Britain’s workers have been demobilised. If it goes on for many months, the shutdown will demand an even larger socialisation of the economy.

Whether the desiccated neoliberal structures of the EU can do anything like this is doubtful. Hitherto sacrosanct rules have been torn up by the European Central Bank’s bond buying programme and relaxing limits on state aid to industry. But the resistance to fiscal burden-sharing of northern European countries such as Germany and the Netherlands may block the way to rescuing Italy – a country too big to be crushed like Greece, but possibly also too costly to save. As the Italian prime minister, Giuseppe Conte said in March:

“If Europe does not rise to this unprecedented challenge, the whole European structure loses its raison d’être for the people.”

The Serbian president Aleksandar Vucic has been blunter and more realistic:

“European solidarity does not exist… that was a fairy tale. The only country that can help us in this hard situation is the People’s Republic of China. To the rest of them, thanks for nothing.” 

The EU’s fundamental flaw is that it is incapable of discharging the protective functions of a state. The break-up of the eurozone has been predicted so often that it may seem unthinkable. Yet under the stresses they face today, the disintegration of European institutions is not unrealistic. Free movement has already been shut down. Turkish president Recep Tayyip Erdogan’s recent blackmailing of the EU by threatening to allow migrants to pass through his borders, and the endgame in Syria’s Idlib province, could lead to hundreds of thousands, even millions, of refugees fleeing to Europe. (It is hard to see what social distancing might mean in huge, overcrowded and insanitary refugee camps.) Another migrant crisis in conjunction with pressure on the dysfunctional euro could prove fatal.

If the EU survives, it may be as something like the Holy Roman empire in its later years, a phantom that lingers on for generations while power is exercised elsewhere. Vitally necessary decisions are already being taken by nation states. Since the political centre is no longer a leading force and with much of the left wedded to the failed European project, many governments will be dominated by the far right.

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An increasing influence on the EU will come from Russia. In the struggle with the Saudis that triggered the oil price collapse in March 2020, Putin has played the stronger hand. Whereas for the Saudis the fiscal break-even level – the price needed to pay for public services and keep the state solvent – is around $80 a barrel, for Russia it may be less than half that. At the same time Putin is consolidating Russia’s position as an energy power. The Nord Stream offshore pipelines that run through the Baltics secure reliable supplies of natural gas to Europe. By the same token they lock Europe into dependency on Russia and enable it to use energy as a political weapon. With Europe balkanised, Russia, too, looks set to expand its sphere of influence. Like China it is stepping in to replace the faltering EU, flying in doctors and equipment to Italy.

In the US, Donald Trump plainly considers refloating the economy more important than containing the virus. A 1929-style stock market slide and unemployment levels worse than those in the 1930s could pose an existential threat to his presidency. James Bullard, the CEO of the Federal Reserve Bank of St Louis, has suggested the American jobless rate could reach 30 per cent – higher than in the Great Depression. On the other hand, with the US’s decentralised system of government; a ruinously expensive healthcare system and tens of millions uninsured; a colossal prison population, of which many are old and infirm; and cities with sizeable numbers of homeless people and an already large opioid epidemic; curtailing the shutdown could mean the virus spreading uncontrollably, with devastating effects. (Trump is not alone in taking this risk. Sweden has not so far imposed anything like the lockdown in force in other countries.) 

Unlike the British programme, Trump’s $2trn stimulus plan is mostly another corporate bailout. Yet if polls are to be believed increasing numbers of Americans approve of his handling of the epidemic. What if Trump emerges from this catastrophe with the support of an American majority?

Whether or not he retains his hold on power, the US’s position in the world has changed irreversibly. What is fast unravelling is not only the hyperglobalisation of recent decades but the global order set in place at the end of the Second World War. Puncturing an imaginary equilibrium, the virus has hastened a process of disintegration that has been under way for many years.

In his seminal Plagues and Peoples the Chicago historian William H McNeill wrote:

It is always possible that some hitherto obscure parasitic organism may escape its accustomed ecological niche and expose the dense human populations that have become so conspicuous a feature of the Earth to some fresh and perchance devastating mortality.

It is not yet known how Covid-19 escaped its niche, though there is a suspicion that Wuhan’s “wet markets”, where wildlife is sold, may have played a role. In 1976, when McNeill’s book was first published, the destruction of the habitats of exotic species was nowhere near as far gone as it is today. As globalisation has advanced, so has the risk of infectious diseases spreading. The Spanish Flu of 1918-20 became a global pandemic in a world without mass air transportation. Commenting on how plagues have been understood by historians, McNeill observed: “For them as for others, occasional disastrous outbreaks of infectious disease remained sudden and unpredictable interruptions of the norm, essentially beyond historical explanation.” Many later studies have come to similar conclusions.

Yet the notion persists that pandemics are blips rather than an integral part of history. Lying behind this is the belief that humans are no longer part of the natural world and can create an autonomous ecosystem, separate from the rest of the biosphere. Covid-19 is telling them they cannot. It is only by using science that we can defend ourselves against this pestilence. Mass antibody tests and a vaccine will be crucial. But permanent changes in how we live will have to be made if we are to be less vulnerable in future.

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The texture of everyday life is already altered. A sense of fragility is everywhere. It is not only society that feels shaky. So does the human position in the world. Viral images reveal human absence in different ways. Wild boars are roaming in the towns of northern Italy, while in Lopburi in Thailand gangs of monkeys no longer fed by tourists are fighting in the streets. Inhuman beauty and a fierce struggle for life have sprung up in cities emptied by the virus.

As a number of commentators have noted, a post-apocalyptic future of the kind projected in the fiction of JG Ballard has become our present reality. But it is important to understand what this “apocalypse” reveals. For Ballard, human societies were stage props that could be knocked over at any moment. Norms that seemed built into human nature vanished when you left the theatre. The most harrowing of Ballard’s experiences as a child in 1940s Shanghai were not in the prison camp, where many inmates were steadfast and kindly in their treatment of others. A resourceful and venturesome boy, Ballard enjoyed much of his time there. It was when the camp collapsed as the war drew to a close, he told me, that he witnessed the worst examples of ruthless selfishness and motiveless cruelty.

The lesson he learnt was that these were not world-ending events. What is commonly described as an apocalypse is the normal course of history. Many are left with lasting traumas. But the human animal is too sturdy and too versatile to be broken by these upheavals. Life goes on, if differently than before. Those who talk of this as a Ballardian moment have not noticed how human beings adjust, and even find fulfilment, in the extreme situations he portrays.

Technology will help us adapt in our present extremity. Physical mobility can be reduced by shifting many of our activities into cyberspace. Offices, schools, universities, GP surgeries and other work centres are likely to change permanently. Virtual communities set up during the epidemic have enabled people to get to know one another better than they ever did before.

There will be celebrations as the pandemic recedes, but there may be no clear point when the threat of infection is over. Many people may migrate to online environments like those in Second Life, a virtual world where people meet, trade and interact in bodies and worlds of their choosing. Other adaptations may be uncomfortable for moralists. Online pornography will likely boom, and much internet dating may consist of erotic exchanges that never end in a meeting of bodies. Augmented reality technology may be used to simulate fleshly encounters and virtual sex could soon be normalised. Whether this is a move towards the good life may not be the most useful question to ask. Cyberspace relies on an infrastructure that can be damaged or destroyed by war or natural disaster. The internet allows us to avoid the isolation that plagues have brought in the past. It cannot enable human beings to escape their mortal flesh, or avoid the ironies of progress.

What the virus is telling us is not only that progress is reversible – a fact even progressives seem to have grasped­ – but that it can be self-undermining. To take the most obvious example, globalisation produced some major benefits – millions have been lifted out of poverty. This achievement is now under threat. Globalisation begat the de-globalisation that is now under way.

As the prospect of ever-rising living standards fades, other sources of authority and legitimacy are re-emerging. Liberal or socialist, the progressive mind detests national identity with passionate intensity. There is plenty in history to show how it can be misused. But the nation state is increasingly the most powerful force driving large-scale action. Dealing with the virus requires a collective effort that will not be mobilised for the sake of universal humanity.

Altruism has limits just as much as growth. There will be examples of extraordinary selflessness before the worst of the crisis is over. In Britain an over half-million strong volunteer army has signed up to assist the NHS. But it would be unwise to rely on human sympathy alone to get us through. Kindness to strangers is so precious that it must be rationed.

This is where the protective state comes in. At its core, the British state has always been Hobbesian. Peace and strong government have been the overriding priorities. At the same time this Hobbesian state has mostly rested on consent, particularly in times of national emergency. Being shielded from danger has trumped freedom from interference by government.

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How much of their freedom people will want back when the pandemic has peaked is an open question. They show little taste for the enforced solidarity of socialism, but they may happily accept a regime of bio-surveillance for the sake of better protection of their health. Digging ourselves out of the pit will demand more state intervention not less, and of a highly inventive kind. Governments will have to do a lot more in underwriting scientific research and technological innovation. Though the state may not always be larger its influence will be pervasive, and by old-world standards more intrusive. Post-liberal government will be the norm for the foreseeable future.

It is only by recognising the frailties of liberal societies that their most essential values can be preserved. Along with fairness they include individual liberty, which as well as being worthwhile in itself is a necessary check on government. But those who believe personal autonomy is the innermost human need betray an ignorance of psychology, not least their own. For practically everyone, security and belonging are as important, often more so. Liberalism was, in effect, a systematic denial of this fact.

An advantage of quarantine is that it can be used to think afresh. Clearing the mind of clutter and thinking how to live in an altered world is the task at hand. For those of us who are not serving on the front line, this should be enough for the duration.