Latest / Thinking Class / #021 - Elisabeth Braw - Goodbye Globalisation, Hello Divided World

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#021 - Elisabeth Braw - Goodbye Globalisation, Hello Divided World · Thinking Class

• 0:00
  SPEAKER_01: Hello everybody, welcome to Thinking Class.
• 0:02
  SPEAKER_01: I'm John Gillam, and today I'm speaking with Elizabeth Braugh.
• 0:05
  SPEAKER_01: Elizabeth is a columnist at Foreign Policy, a senior fellow at the Atlantic Council, and the author of Goodbye Globalization.
• 0:12
  SPEAKER_01: In this episode, Elizabeth and I talk about what globalization is and why we are saying goodbye to it as we know it, why we should trade with countries similar to us in values, the different approaches taken across the West and dealing with the end of globalization, why ESG is having a negative impact on the defense sector and countries' ability to defend themselves, and why the West's liberalism blinded it to other countries' cultures and priorities.
• 0:35
  SPEAKER_01: Before we dive in, you'd be really helping me out if you press subscribe on the device you are listening or watching the show on.
• 0:41
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• 0:46
  SPEAKER_01: Enjoy the show, classmates.
• 0:57
  SPEAKER_01: Welcome to Thinking Class, Elizabeth.
• 0:59
  SPEAKER_01: Thanks so much for joining me.
• 1:02
  SPEAKER_00: Thank you.
• 1:03
  SPEAKER_01: Excellent.
• 1:04
  SPEAKER_01: Well, welcome to the show.
• 1:06
  SPEAKER_01: Elizabeth, I stumbled across you, um, well, I suppose algorithmically speaking, on LinkedIn and Twitter around about the same time.
• 1:15
  SPEAKER_01: I guess the internet must have sensed there was um some adjacent thoughts going on in my gray matter alongside what it is that you you write and speak about so much these days, which is um predicting, I suppose, the the downfall of globalization as we know it.
• 1:35
  SPEAKER_01: And you write very straightforwardly, intelligently, entertainingly about it and its prospects.
• 1:40
  SPEAKER_01: And um I I I I particularly was drawn to you because you are someone who chronicles practical evidence of what it is that you're saying we're seeing instead of just engaging in abstract policy discussions.
• 1:56
  SPEAKER_01: So I guess before we dive into the the meat of what it is that you focus on, globalization is a term that is used a lot, and I think people have a sense for what it is.
• 2:07
  SPEAKER_01: Perhaps we should start with defining it in its entirety.
• 2:12
  SPEAKER_01: So, how how would you define globalization, Elizabeth?
• 2:15
  SPEAKER_00: Well, that's that's a good idea, and uh let me just say one thing first, which is that it's it's interesting how uh Donald Trump has weaponized the whole concept of globalization and decided to call it globalism to essentially suggest that it's some sort of ideology like communism, but globalization really is um globe-spanning trade between countries, which is why the the round that we have seen since the 80s uh that accelerated, especially in the early 90s and then peaked uh about one and a half decades ago.
• 2:56
  SPEAKER_00: Um that's the the most um the most globalization we have ever had.
• 3:03
  SPEAKER_00: We have had other rounds in world history of countries trading a lot amongst themselves.
• 3:09
  SPEAKER_00: And we saw, for example, in the Roman Empire, various regions of the Roman Empire traded a lot among themselves, but that was not the whole world.
• 3:16
  SPEAKER_00: Uh what we got in the late 80s and early 90s and Science was really most other parts of the world trading together and doing so very beneficially for everybody, or so it seemed at the time.
• 3:32
  SPEAKER_01: Okay, well, that's a useful starting point.
• 3:35
  SPEAKER_01: So, as I alluded to in the intro, you write a lot about how globalization has started to um hit the buffers, as it were.
• 3:44
  SPEAKER_01: So let's let's look at some of the uh evidence that there is a move away from it um culturally, politically, economically.
• 3:54
  SPEAKER_00: The reason I started thinking that something was that something fundamental was changing was when I started hearing from business people that that Russia is just not as well coming as it used to be.
• 4:06
  SPEAKER_00: China is not as welcoming as it used to be.
• 4:08
  SPEAKER_00: Something fundamental is shifting.
• 4:11
  SPEAKER_00: And that's when I think you really have to pay attention because business people are they are the practitioners of globalization, right?
• 4:19
  SPEAKER_00: I mean, analysts can sit in their studies or even maybe in their living rooms and have opinions about globalization, but it's the business people who are out there and making it happen.
• 4:31
  SPEAKER_00: And if they are saying something fundamental is shifting, it's it's just not the way it used to be, then you should pay attention.
• 4:39
  SPEAKER_00: And so I started paying attention, uh paying closer attention, and indeed very close attention, and it became obvious to me that we were seeing several things happen at the same time.
• 4:52
  SPEAKER_00: China and Russia were becoming less hospitable.
• 4:55
  SPEAKER_00: And this is um, we should remember, uh uh during a period uh so we were talking about a few years ago, when when uh Xi Jinping had taken over, when he was keen to assert um his government's power over the rest of society, and that included the private sector.
• 5:16
  SPEAKER_00: So if you are the Chinese government, then you don't want the private sector to become so successful that it becomes a threat to you.
• 5:24
  SPEAKER_00: And that's what we were beginning to see uh evidence of.
• 5:30
  SPEAKER_00: And in Russia, of course, we saw essentially the the the Russian government becoming uh less predictable, less sane.
• 5:39
  SPEAKER_00: And I remember vividly I had a conversation with somebody who then uh who uh turned out to be uh a very wise uh prophet, uh although he is a businessman, but on this he was prophetic, and and he said, you know, um I will I will I uh my company will not be making any more strategic investments in Russia.
• 6:05
  SPEAKER_00: It's just too unpredictable, and with the sort of uh longer term uh that you need for investments, who knows what will happen 10 years from now.
• 6:17
  SPEAKER_00: It's just not it's just not good business to make those sort of investments when when you can't know what will happen from one day to the next.
• 6:25
  SPEAKER_00: And then the other thing that that was emerging around the same time was that IP uh Western companies' IP loss really became a big issue in in the Western business community.
• 6:38
  SPEAKER_00: And they had tolerated it for years, losing IP to Chinese competitors, but by the middle of the last decade, Chinese companies had become so successful and so powerful, not least thanks to the IP that they had um that they had uh acquired legally or illegally from from Western competitors, that they were all of a sudden very close competitors.
• 7:07
  SPEAKER_00: They were not just some sort of uh uh puny companies uh to whom you could afford to lose IP.
• 7:15
  SPEAKER_00: And then uh perhaps most importantly, two things uh Western citizens beginning to voice their unhappiness with globalization most prominently by electing Donald Trump.
• 7:31
  SPEAKER_00: But we also saw saw some of it in the Brexit vote, and it was not specifically about globalization, but it was this this uh this unhappiness with faraway elites that decide about uh about our lives.
• 7:43
  SPEAKER_00: And and so uh that was a uh a sort of a convenient vote for people to cast, even though globalization was not on the on the ballot paper.
• 7:54
  SPEAKER_00: And then one more thing, which is the the geopolitical standoff uh that began to merge between uh the West on one hand, uh Russia and China on the other hand.
• 8:04
  SPEAKER_00: And so with those, all those developments going on at the same time, those those forces uh against globalization, it was clear that globalization was going to be in trouble.
• 8:17
  SPEAKER_01: I find it very interesting that there's so much talk about supply chain resilience now.
• 8:23
  SPEAKER_01: If you spend any time looking at you know the yellow papers of the the Financial Times or if you spend any time in the corporate world.
• 8:32
  SPEAKER_01: And it seems to me that it's a little bit of a euphemism.
• 8:36
  SPEAKER_01: Um, and sometimes I can't tell what it stands for.
• 8:38
  SPEAKER_01: Sometimes I can't tell whether it's it stands for we want to keep globalization going, but let's just figure out where else to manufacture all of these thousands of parts for our various electrical items um that isn't China and Russia, or let's figure out where to import those from, or whether it's uh is there going to be a renaissance in Western domestic industry, for example?
• 9:02
  SPEAKER_01: I mean, Lord knows Britain needs that uh out of the Western nations.
• 9:06
  SPEAKER_01: Um what do you think about that?
• 9:09
  SPEAKER_01: Uh what do you what do you think it means?
• 9:11
  SPEAKER_01: What do you think all this focus on supply chain resilience is about?
• 9:14
  SPEAKER_01: Is it about keeping the show on the roads as it has always been, or is it about let's start bringing things closer to home?
• 9:22
  SPEAKER_00: It is true that that we have seen a lot of uh supply chain talk, and even even people who have nothing to do with supply chains know that that there is a problem with supply chains.
• 9:32
  SPEAKER_00: So, and they know that because it's being discussed everywhere.
• 9:36
  SPEAKER_00: And one reason it's being discussed everywhere is that COVID struck and brought home very vividly to everybody, from businesses to ordinary citizens, that we are incredibly closely connected with China.
• 9:51
  SPEAKER_00: We should remember that it's because we are that closely connected that the virus itself traveled from China to uh first to Italy and then to other countries.
• 10:01
  SPEAKER_00: Uh, if we hadn't been that closely connected, it wouldn't have spread that quickly.
• 10:05
  SPEAKER_00: Um but the other thing that happened was that uh Chinese authorities were not transparent with the rest of the world about the fact that the virus was spreading.
• 10:15
  SPEAKER_00: And it doesn't matter where it originates, the fact is that it started spreading and they denied they were spreading as, and as a result, it it uh continued to spread and then spread to the rest of the world.
• 10:26
  SPEAKER_00: So that's how many people, politicians uh and ordinary citizens, uh, lost faith in the Chinese leadership.
• 10:33
  SPEAKER_00: Um, but when it comes to supply chain um uh and supply chain resilience, COVID was also a very vivid reminder of how dependent we are on China, especially, but on other countries as well, because during COVID, all of a sudden it became much more difficult to import from other countries.
• 10:51
  SPEAKER_00: And companies that had major manufacturing and supply chains in China all of a sudden found themselves stranded.
• 10:59
  SPEAKER_00: And I write about this in the book, they were stranded because there were constant lockdowns in China.
• 11:03
  SPEAKER_00: China had a zero COVID policy after a while when they came around to uh to acknowledging that they they had a COVID problem.
• 11:11
  SPEAKER_00: Um so that meant that factories could close just like that.
• 11:16
  SPEAKER_00: And and if you're a Western company or any sort of company, and and your supplier can have, may have to suspend operations at any moment, what does that do to your space in your supply chain?
• 11:28
  SPEAKER_00: You start saying, well, maybe I should uh I should uh uh get additional suppliers, that will be more expensive, but then I will have a backup.
• 11:38
  SPEAKER_00: Maybe I should just move away from Chinese suppliers altogether.
• 11:42
  SPEAKER_00: That is also very difficult, that is very difficult because it's uh China is the factory of the world.
• 11:48
  SPEAKER_00: But those sort of uh thoughts started being entertained uh in in in uh corporate uh headquarters and not just entertained by but acted upon.
• 12:01
  SPEAKER_00: And I think it's interesting when when analysts and and general commentators talk about, oh, you know, we needed to shore up our supply chains.
• 12:09
  SPEAKER_00: Companies are working very hard at that, and and uh it's just extremely hard to do.
• 12:15
  SPEAKER_00: And uh it's uh it it is really like um uh like selling your house, but it's a thousand times more complicated.
• 12:25
  SPEAKER_00: You have to find an alternative, you have to completely shift around what it is, you need to have work, and you have to do it without any disruption uh to your to your customers.
• 12:37
  SPEAKER_00: It's so complicated.
• 12:38
  SPEAKER_00: But that action is is taking place uh precisely because companies are concerned that that their supply chains may be disrupted by uh by uh Mother Nature or by by um political actions in a country like China.
• 12:56
  SPEAKER_01: I can't remember which platform it was that you commented, Elizabeth, but you had mentioned there were people relatively high ranking within business and uh that that sometimes disagree with you that globalization is ailing.
• 13:11
  SPEAKER_01: Uh it sounds to me, uh and it it seems to me in your book, that um there are there's lots of evidence that it is.
• 13:18
  SPEAKER_01: So why is it that people disagree with you when you say that globalization may well be coming to a halt?
• 13:26
  SPEAKER_00: I think uh the people who disagree with me are a few academics and they measure trade flows and they say, well, look, the trade flows this year were great, and uh and based on that, globalization is not in trouble.
• 13:41
  SPEAKER_00: But of course, trade flows measure what has been, whereas what I'm saying is that people have lost faith in globalization.
• 13:48
  SPEAKER_00: So we'll see we'll see less trade between certain countries, and and uh also if you measure trade flows uh collectively around the world, I don't think they will decline because we'll trade more with countries that that we are friends with, or at least uh are not um on hostile terms with.
• 14:09
  SPEAKER_00: So we won't see uh trade flows plummet simply because we don't trade as much with Russia and China anymore.
• 14:16
  SPEAKER_00: What I'm what my point is, is it is that it's it's just not globalization anymore.
• 14:21
  SPEAKER_00: If you don't have the key parts of the world involved, it's not globalization.
• 14:25
  SPEAKER_00: And so I think that's that's the point that these academics are missing.
• 14:28
  SPEAKER_00: First of all, they they measure what has been when you know uh restructuring your supply chains is such a lengthy undertaking that will it will take uh it will take some time before companies can can shift uh operations, uh partially shift operations out of China towards uh other countries.
• 14:48
  SPEAKER_00: And that's what we we may start seeing um unless trade with China, but it will be slow and it will be gradual.
• 14:54
  SPEAKER_00: But what matters is that people have lost faith in globalization.
• 14:58
  SPEAKER_01: Okay.
• 14:59
  SPEAKER_01: Okay.
• 15:00
  SPEAKER_01: Well, I I don't think I could disagree with that, judging by the the the the uh mood music that you see, um uh whether it's in polling data uh or whether it's within all of the evidence that you suggest, and you drop breadcrumbs throughout your your your Twitter feed saying here's another example of it coming to an end in the way that we knew it.
• 15:22
  SPEAKER_01: Um you have suggested that we're saying goodbye as globalization and that it might be a good thing that we are.
• 15:29
  SPEAKER_00: Um why is that globalization?
• 15:34
  SPEAKER_00: the way it was thought out, it it it was never really an ideology.
• 15:40
  SPEAKER_00: It was just an opportunity that came along in the late 80s and especially in the early 90s, when we had lots of countries all saying at the same time, we want to introduce market economy.
• 15:51
  SPEAKER_00: First came China, which which did market economy its way, first through a few experimental areas uh and then uh more widely, but it was it was market economy uh with Chinese characteristics.
• 16:05
  SPEAKER_00: And of course, uh after that came uh the countries behind the iron curtain.
• 16:10
  SPEAKER_00: But because all that happened at the same time, uh uh, and in addition to that, we also saw countries in Latin America open up.
• 16:18
  SPEAKER_00: They had been protectionists, but they opened up.
• 16:20
  SPEAKER_00: So all of a sudden, we we sort of got globalization served on a on the on the platter, and we said, oh, that is fantastic.
• 16:28
  SPEAKER_00: Um uh and what's a question?
• 16:34
  SPEAKER_01: Uh I was uh asking why it might be a good thing that we're getting less globalization or that it's on its way out.
• 16:43
  SPEAKER_00: And everybody seemed to want the same thing, which was market economy, trade with each other, be friends.
• 16:49
  SPEAKER_00: That was that was the the the sound of the 90s.
• 16:54
  SPEAKER_00: Um but at least as far as Western countries are concerned, we were we were naive in thinking that it was it was uh some sort of new era.
• 17:08
  SPEAKER_00: Uh and we thought that Russia and China wanted to become like us simply because they wanted market economies.
• 17:13
  SPEAKER_00: No, they just wanted, as it has turned out, they just wanted higher living standards for their own citizens.
• 17:20
  SPEAKER_00: Uh it had nothing to do with them wanting to become like us, or at least with their leaders wanting their countries to become like us.
• 17:27
  SPEAKER_00: Um but uh that took us a very long time to figure out.
• 17:32
  SPEAKER_00: In fact, it has taken us until basically now to figure out.
• 17:35
  SPEAKER_00: Um, so we built globalization on this idea that everybody uh wants the same thing, and we are we are there uh essentially we are all good-willing, well-meaning nations who all have a stake in this and who all want to make this work.
• 17:53
  SPEAKER_00: And the sort of pinnacle of that was when China was admitted to the World Trade Organization.
• 17:58
  SPEAKER_00: And then as a member there, you have to follow certain rules, and we were convinced that China would follow those rules.
• 18:04
  SPEAKER_00: And then it emerged that China wasn't going to be particularly faithful to those rules, but there was nothing we could do about it.
• 18:12
  SPEAKER_00: So globalization this this round has been based on, I think, overly optimistic assessments of our fellow countries, and uh it also has included uh uh a few key areas, most uh crucially climate change.
• 18:32
  SPEAKER_00: I mean, climate change was just not a big issue in in the 80s and early 90s, and now it's it is an existential issue.
• 18:39
  SPEAKER_00: So uh it is a good thing that globalization is retreating because it has uh this round had many flaws.
• 18:46
  SPEAKER_00: Now we get to um rethink what we think globalization should look like, and I think we we come up with a new version that is uh less intense, less all-encompassing, but more realistic, and uh also includes climate change and who knows what other existential issues may emerge in in the next few years, but definitely climate change will have to be baked into uh the globalized economy when it when it re-emerges as a globalized economy.
• 19:17
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• 19:19
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• 19:52
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• 19:58
  SPEAKER_01: It would be good to return to what you think, and I know you referred to it as this in a recent conversation with some senior business leaders, what what globalization 2.0 might look like.
• 20:09
  SPEAKER_01: Um, but let's stick to that environmental point for a moment.
• 20:12
  SPEAKER_01: It's tangential, it's not exactly the same as climate change, but you'd posted an article uh in foreign policy recently where you had shown through uh examples of conflict, particularly in the Red Sea, that the Houthis, I think, had downed uh a ship, um I can't remember whose ship it was, and it had 21,000 metric tons of ammonium phosphate sulfate fertilizer on board, which is just going to cause unbelievable environmental damage.
• 20:40
  SPEAKER_01: Another example of why companies, nations are trying to find new trade routes in which to not have to go through this and keep it all going.
• 20:50
  SPEAKER_01: Um, and and I whilst you're on that, I think it's probably worthwhile talking a little bit about that acronym many people have become familiar with ESG, um, for good or for ill, so environmental social governance.
• 21:02
  SPEAKER_01: And I suppose it came on the scene, it was seen as an unyaloid, you know, do gooding thing.
• 21:08
  SPEAKER_01: And there's lots of talk about it providing win-win investments, um, which turned out not to be backed up by the evidence, judging by recent studies.
• 21:17
  SPEAKER_01: Um, but it does attract those who hope for business to be able to do good through their business activities.
• 21:23
  SPEAKER_01: And it's since become supported by a vast array of international reporting frameworks to try and bring about any of the goals that have been set by the organizations that are um supporting certain aspects of it.
• 21:35
  SPEAKER_01: Um and these are typically thought up in cosmopolitan hubs by people like you and I, right?
• 21:41
  SPEAKER_01: The professional managerial class.
• 21:43
  SPEAKER_01: And we we can have a tendency to, and I say that more um in a figure of speech rather than actually you and I, but we have a tendency to think in solutions rather than trade offs.
• 21:53
  SPEAKER_01: And let's get into the trade offs because you you've posted about something specifically to do with military spending and security.
• 22:00
  SPEAKER_01: Recently, where you said there are unintended consequences of these technocratic programs like ESG.
• 22:07
  SPEAKER_01: What were those examples about military spending and activity that have been impacted by ESG?
• 22:13
  SPEAKER_00: Yes, so under ESG rules, uh defense spending, uh or rather, uh lending to defense companies became uh it became uh undesirable uh because it defense companies were seen as doing ill rather than doing good.
• 22:33
  SPEAKER_00: Um so that meant that uh first of all lenders didn't want to lend the money, and and every company needs uh needs uh additional uh financial infusions every now and then uh for for all kinds of reasons.
• 22:50
  SPEAKER_00: Um but uh it became much harder for defense companies to uh uh lend money or to get financing because they were seen as as doing harm rather than good.
• 23:02
  SPEAKER_00: And so their financing became more expensive.
• 23:06
  SPEAKER_00: And uh you can say, well, you know, defense companies, you know, they make products that kill people, of course, that that is doing harm rather than doing good.
• 23:14
  SPEAKER_00: But now uh with the world shifting, we have realized that, oh, we need defense companies and we need their products if we are to keep our country safe.
• 23:24
  SPEAKER_00: And and yet we have this long legacy of ESG making it difficult for them to get financing, and as a result, a result, difficult for them to expand, which is precisely what we need them to do now.
• 23:35
  SPEAKER_00: Now, um, some of this some some ESG practitioners and and companies that use uh ESG uh rules and guidelines are beginning to change their ways, but slowly, and and we need this investment in defense manufacturing now, if we if we are to get the defense equipment we need to send to Ukraine and and to have in our countries.
• 23:58
  SPEAKER_00: So it definitely is a case of unintended consequences, but it was also, I think, uh the case that the people who have fought up uh and executed ESG never really understood national security.
• 24:10
  SPEAKER_01: No, no, I I I dare say that what drives people who get involved in ESG thinking about military conflict is probably not in their top priorities.
• 24:21
  SPEAKER_01: And um, and I suppose that goes back to that that tendency for optimism, um, which obscures um a whole bunch of important things actually and and leads you to um commit a few planning fallacies where you just you just think things will turn out okay because you've got good intentions, and I and I'm simplifying things heavily here, but that is a great example of you know thinking you can manage things by metrics and targets, and hey, like how could this possibly have some kind of a detrimental impact on our national security by us just trying to like do good?
• 24:58
  SPEAKER_01: And um, and and and so it has, and and I guess there's a theme arising from some of your other responses here, which is um linked to what you're talking about with China's accession to the World Trade Organization and relations with it and Russia.
• 25:13
  SPEAKER_01: And those of us who are from these liberal countries, which have you know have come from a very specific constitution, but right?
• 25:22
  SPEAKER_01: It's you know, it's from a very long culture, first first Christian before then becoming secular, but still bathed in it for a couple of thousand years, and thus a very different way of seeing the world and approaching one another than other nations and regions.
• 25:37
  SPEAKER_01: And I I think um we can be quite prone to being unscrupulously optimistic um and obscuring things from our view that doesn't quite fit the the the narrative.
• 25:51
  SPEAKER_00: Yes, and and and that has led many Western leaders and analysts and others to to uh think and say that oh you know Putin would never know do this, Putin would never do that, uh both because we we tend I I the tendency is to to think uh to see others um to to judge their to assess their thinking uh as if uh as if they think like we do.
• 26:24
  SPEAKER_00: Well they they may think in a completely different way, they may have completely different priorities.
• 26:28
  SPEAKER_00: Uh so you can't sort of if you engage in mirror imaging and say, well, you know, invading Ukraine would be such a terrible idea because it would cause ABC uh harm to Russia.
• 26:43
  SPEAKER_00: Uh therefore it's uh it's it's not going to happen.
• 26:47
  SPEAKER_00: Well, Putin may not be interested in those reasons.
• 26:50
  SPEAKER_00: He may uh uh invading Ukraine may be his number one priority.
• 26:56
  SPEAKER_00: And uh mirror imaging I think leads us down the wrong path.
• 27:01
  SPEAKER_01: Absolutely.
• 27:02
  SPEAKER_01: Uh a personal anecdote.
• 27:04
  SPEAKER_01: Uh about eight years ago, seven years ago, I went to uh uh anti-corruption um week-long set of seminars, and in one of our little groups, there was a um uh there was a Russian woman who lived in Paris, and I was still pretty wet behind the ears at that point to use an English phrase, and um we were talking about how to deal with elements of corruption, and I was only bringing it from my British perspective, and she said, Well, that's just not going to work in Russia, and I remember responding in this, well, of course it would, you know, it's really simple as X.
• 27:40
  SPEAKER_01: So I said she's like, Yeah, no, no, you just don't understand Russia.
• 27:43
  SPEAKER_01: Yeah, yeah you're thinking at it from a totally different angle.
• 27:47
  SPEAKER_01: Earlier you spoke about the um over uh how we overestimated uh our ability to get China to see things like us when they acceded to the World Trade Organization.
• 27:58
  SPEAKER_01: Uh and I wonder um since then whether we've been influenced, we in the West have been influenced by their ways of doing things and governing.
• 28:08
  SPEAKER_01: And to give you an example of that, I suppose there are amongst the commentariat you'd see um comment on the rise of digital mass surveillance, for example, or that within our central banks there's a tendency towards things like central bank digital currencies, which are similar to um social credit scorings that goes on over in in China.
• 28:32
  SPEAKER_01: Um do you think there has been an influence the other way?
• 28:36
  SPEAKER_01: Have we become a little bit more like uh like their modes of governance?
• 28:42
  SPEAKER_00: I don't think we've become like them, but uh that has become that has emerged in in the popular uh the the general uh discourse among people and yeah among some some uh professional uh commentators, this idea that oh authoritarian countries do everything better and and it's just hopeless being a liberal democracy and we should be a bit more like them.
• 29:14
  SPEAKER_00: Uh because we see that uh, you know, whenever something happens in China, they can uh just have um Xi Jinping say if you have looks and and then you know the government machine machinery kicks into uh kicks into the highest gear and gets it done.
• 29:31
  SPEAKER_00: And not just the government machinery, but the private sector and indeed civil society, and we say, oh, it's hopeless.
• 29:37
  SPEAKER_00: We you know, we are so disorganized, we are so divided, and we should just be more like them.
• 29:43
  SPEAKER_00: Well, I think if um anybody who proposes we should be like them were to go and live in Russia and China at the moment, I think they would be very pleased to have a Western passport and a knowledge that they could uh, unless they get arrested, that they could get back to their home country uh whenever they wanted to.
• 30:03
  SPEAKER_00: Whereas of course Russian and Chinese citizens uh are not in that fortunate position.
• 30:09
  SPEAKER_01: Okay.
• 30:09
  SPEAKER_01: Well, I know we are very tight on time, so uh I'll start bringing this into the end zone, as it were.
• 30:16
  SPEAKER_01: And uh I'm gonna pick up on a thread uh from earlier, which was different ways in which we we're now accepting that globalization is not quite working.
• 30:26
  SPEAKER_01: There's the the thread we've already covered, which is business leaders realizing things are changing in places that they would source uh materials from and goods from in Russia and China.
• 30:36
  SPEAKER_01: But then there was also the sentiment of the the wider public outside of policy making, government circles, and and business circles saying, kind of had enough uh of of this model.
• 30:48
  SPEAKER_01: And so on that note, um, I'm gonna quote um something from Dominic Cummings that I just read in an article that was published in the New Yorker recently, uh, and someone who was a London staff writer had had written about 14 years of conservative rule and the key figures within that and key things that happened.
• 31:06
  SPEAKER_01: So this is this is Dominic Cummings' observation that Britain has failed to confront the full implications of the Brexit vote, and and you'll see where I'm going with this, with the follow-up question.
• 31:17
  SPEAKER_01: He said, you can just treat it as like a weird thing, like a witch trial in a medieval village.
• 31:22
  SPEAKER_01: Now the witch has been burned and now the community is getting back to normal, or you can think of it as part of big structural changes in Western politics, society, and the economy.
• 31:32
  SPEAKER_01: If the establishment thinks you can treat it like a sort of episode of witchcraft mania, then they're just going to walk straight into recurring shocks.
• 31:40
  SPEAKER_01: So since the book's launch, Elizabeth, you've been meeting with leaders of large multinationals, presumably people in government as well.
• 31:48
  SPEAKER_01: Um, are they preparing for a return to an economically divided world, which is what supporters of Brexit and perhaps Trump in some respect would like?
• 31:59
  SPEAKER_01: They want more domestic focused policies.
• 32:02
  SPEAKER_01: Um, and will they start to engage with the sentiments of those outside of the metropolitan class, or is globalization 2.0 going to be a rerun of globalization 1.0, but just with different players?
• 32:16
  SPEAKER_00: Well, it depends on who will be in charge.
• 32:18
  SPEAKER_00: I I think the mistake that somebody like Donald Trump makes is to think that everything can be made in America or uh whatever the country may be.
• 32:29
  SPEAKER_00: Uh the end of globalization doesn't mean that we should should should or will stop trading.
• 32:34
  SPEAKER_00: It just means that we shouldn't and and won't trade as much with countries that that uh uh don't share our values because that uh causes uh enormous risks to businesses and and uh it's it's just uh it's just too perilous to make our societies dependent on countries that are that don't share our values.
• 32:57
  SPEAKER_00: Um but uh we can still trade with a lot of other countries, and a lot of other countries um are essentially benign, are happy to trade with us, don't wish us in.
• 33:08
  SPEAKER_00: Obviously, they defend our rights if if you know if if there's a disagreement or something, but that's that's how countries act.
• 33:15
  SPEAKER_00: Um so I think there is, especially in America, which is obviously uh such a uh a large country, population-wise, um, and uh not to mention uh economy-wise, there is this um uh this tempting uh idea that oh we should just make everything at home.
• 33:36
  SPEAKER_00: Uh and uh the IRAs, the inflation reduction act that was passed uh a couple of years ago, was essentially a step in that direction.
• 33:44
  SPEAKER_00: Is it it incentivizes companies to uh invest in in green technology in America?
• 33:51
  SPEAKER_00: So what you get is a win-win-win.
• 33:53
  SPEAKER_00: You get companies returning, jobs returning from China to America, you get the green transition, um, and you get uh you get uh qualified manufacturing jobs uh at home in America.
• 34:06
  SPEAKER_00: So you reduce the dependence on China, you get the green transition, and you get new jobs.
• 34:11
  SPEAKER_00: But America somehow forgot America's closest friends uh in in this uh in the process of of passing the Inflation Reduction Act.
• 34:20
  SPEAKER_00: And it wasn't uh, I'm not saying that it was Trump's doing.
• 34:23
  SPEAKER_00: It's it's uh this is uh uh obviously a congressional uh bill uh and by the way, uh negotiated with the White House under Joe Biden.
• 34:33
  SPEAKER_00: But there is this uh tendency, especially under Trump, but maybe a bit under Biden as well, to think, uh, well, America should just make it as much as possible at home.
• 34:43
  SPEAKER_00: And and that's not what we should hope for for America or any other Western country.
• 34:47
  SPEAKER_00: We should hope for more trade among countries that that are that follow the rules, that share a basic set of values.
• 34:54
  SPEAKER_00: They don't have to be liberal democracies, all of them, but share a commitment to to maintaining uh some sort of global order.
• 35:02
  SPEAKER_00: And uh I think with that we can we can increase trade with other countries.
• 35:07
  SPEAKER_00: It's just the countries that that uh weaponize uh global trade.
• 35:12
  SPEAKER_00: Uh it's it's too it's too dangerous to to make uh to hinge our future on that.
• 35:19
  SPEAKER_01: Agreed.
• 35:20
  SPEAKER_01: Uh I will, from a purely British perspective, maintain hope that we do reorient ourselves a little bit so we're not just so focused on a service-based economy because it's just it is so out of whack here.
• 35:32
  SPEAKER_01: And as someone from the north of England, um I I know that we probably do export far too much to other countries with regards to our manufacturing capabilities.
• 35:43
  SPEAKER_01: So we could do with some more of that back.
• 35:45
  SPEAKER_00: And imagine uh what uh creation of high-skilled manufacturing jobs could do for the north of England, for the Midlands.
• 35:55
  SPEAKER_00: There are people who would be uh who would who are there and willing to learn the skills that are needed because the jobs that may return are not like the the jobs that are left in in this uh most recent round of globalization, but the people are there and uh and are willing and able to learn these new skills and and uh what's not to like as long as it uh as it doesn't lead to to uh an idea of of uh protectionism or let's do everything at home.
• 36:25
  SPEAKER_00: But the Midlands could play uh and the north of England could play uh an incredibly positive role within um uh trade uh among the West and its partners, and and one day maybe Russia and China will return to the fold.
• 36:41
  SPEAKER_01: Well, it will be written.
• 36:43
  SPEAKER_01: Uh Elizabeth, thanks so much for joining me.
• 36:46
  SPEAKER_01: Before I let you go, uh you're active on social media, you've got various uh publications.
• 36:51
  SPEAKER_01: Where can people find you?
• 36:53
  SPEAKER_00: They can find me on Twitter at Elizabeth Grohn, that's Elizabeth with an S, and they can find me on LinkedIn, and most especially they can find me on foreign policy, which is foreignpolicy.com, and they will find all my pieces there, as well as uh on Political Europe's website and in other publications.
• 37:12
  SPEAKER_01: Excellent.
• 37:13
  SPEAKER_01: And I presume they can buy your recent book, Goodbye Globalization, from all good bookshops and Amazon.
• 37:19
  SPEAKER_00: All good bookshops and Amazon.
• 37:20
  SPEAKER_00: All right, Joe.
• 37:22
  SPEAKER_01: Great.
• 37:22
  SPEAKER_01: Okay, well, Elizabeth, thanks so much for joining me on the show, and I look forward to keeping up with what you're doing.
• 37:28
  SPEAKER_00: Thank you.
• 37:29
  SPEAKER_01: Take care.
• 37:32
  SPEAKER_01: Thank you for joining me in Thinking Class today.
• 37:35
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• 37:44
  SPEAKER_01: Thinking Class seeks to understand the civilizational issues we face and why what our leaders do in response matters.
• 37:50
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• 38:00
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• 38:09
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