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Thursday, July 31, 2014 12:01 am

Will a new era restrain nationalism?

 Eras of history are generally recognized only long after they start. But it might be that our world has just walked into a new era this last month as five rising nations formed The New Development Bank in Brazil. If so, this could represent either a fortuitous or an ominous portent for the future.

What happened in Fortaleza, Brazil, when the so-called BRICS nations got together? These five countries – Brazil, Russia, India, China and South Africa – formed their own development bank to help finance infrastructure and to share foreign currencies. They did this largely because the major powers would not give them a say in existing world institutions commensurate with their newfound economic power. China has 16 percent of world GDP but only 4 percent of votes in the International Monetary Fund. But as the world gains $50 billion in additional financing to meet the needs of developing countries, what is there not to like?

For almost 400 years, nation states have pursued nationalism, each seeking its own self-interest. Historically, such unbridled nationalism always ended up, not surprisingly, in war. After the Napoleonic wars, the European States said “enough,” and signed the Treaty of Paris which brought peace for roughly 100 years. They created a balance-of-power nationalism, a constrained nationalism, wherein the European states agreed that any country that broke the peace or got too strong would be blocked by a strong coalition of the other states to keep the peace. The system crashed in 1914 because Germany was confronted too late.

During the interwar period unrestrained or naked nationalism returned, creating both a world depression and another war.

After the war the United States dictated a new system of constrained nationalism, overseen by the U.S. and by the United Nations Security Council and accompanied by world financial and banking institutions which were controlled by the U.S. and Europe. Soon the Cold War with Russia made this new system obsolete. Yet the terror of the bomb and the dominance and leadership of the U.S. over the Free World kept order and peace for a remarkable 45 years. When the Soviet Union collapsed in 1989, the U.S. became the sole superpower.

Unfortunately, the U.S. had neither a plan nor the will to create a new system of constrained nationalism as had happened in 1815. The U.S. instead used its power as an international enforcer, including employing regime change on recalcitrant countries and even reverting to torture. More recently, the U.S. used its new technology of drones and information capture to overrun the long-held norm that a nation’s sovereignty is inviolate. Drones struck within countries we were not at war with and Angela Merkel, the German chancellor, and President Dilma of Brazil found their private conversations bugged. The word and honor of the U.S. was besmirched. So if the rich boys club did not look quite as honorable as before and wouldn’t let the second-tier boys into their club, the rising powers would create their own club. As the overall power of the U.S. to lead, command and persuade declines and new blocs of power emerge, especially that of China, are we headed back to unconstrained nationalism? When the rules of the road for international behavior are contested in the future, who will direct and control traffic on the increasingly congested crossroads of our earth? Perhaps the disintegration of the Middle East, the Russian push on the Ukraine, and the spats between China and its Asia neighbors are harbingers of the return of unconstrained nationalism.

The greater complexity and intensity of economic interactions among countries will require some form of international leadership, rules of behavior and enforcement. We are going 180 degrees in the wrong direction, backward to a world of free-for-all nationalism. This is at a time when the world needs agreed-upon leadership, rules of behavior and collaboration to steer us all though the uncharted waters ahead.
Roy Wehrle of Springfield served at the rank of economic counselor in the U.S. Foreign Service, as a senior economist in the Council of Economic Advisors under President Kennedy, and is a professor emeritus at UIS.

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