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6 November 2019

Leader: The revenge of history, 30 years on from the fall of the wall

Beyond the West, the assumption that economic liberalism would lead to political liberalism has been disproved.

By New Statesman

Liberals once believed that the retreat of democracy would be akin to water flowing uphill. The fall of the Berlin Wall on 9 November 1989 (recalled by the BBC’s John Simpson on page 30) was greeted as the beginning of a new era of liberal hegemony. “I hear people say we have to stop and debate globalisation,” Tony Blair would later declare in his 2005 Labour Party conference speech. “You might as well debate whether autumn should follow summer.”

Globalisation’s apparent triumph proved a false dawn, however. Thirty years after the wall came down, liberal democracy is under threat across the world.

Beyond the West, the assumption that economic liberalism would lead to political liberalism has been disproved. A revanchist Russia – determined to avenge its perceived humiliation after the fall of the Soviet Union – is subverting democracy at home and abroad. In China, Xi Jinping, the country’s most powerful leader since Chairman Mao, has positioned himself as ruler for life. India and Turkey are led by authoritarian nationalists (Narendra Modi and Recep Tayyip Erdogan), while Brazil has elected Jair Bolsonaro, a far-right defender of military dictatorship.

With hindsight, 1989 now appears a more ambiguous moment. As the Bulgarian political scientist Ivan Krastev, the co-author of The Light that Failed, observes in his interview with Gavin Jacobson on page 26, “Liberals, leftists and conservatives all fell in love with this year [1989] because it reinforced certain assumptions each of them had about the world.” Classical Marxists were “optimistic because it provided an opportunity to reinvent a non-Stalinist left”, while eastern European nationalists “felt on the winning side because they had been strongly anti-communist”.

But it was liberals who were entrusted with the post-Cold War order. The collapse of the command economies of eastern Europe and a period of unprecedented growth inspired an evangelical faith in the free market. In his June 2007 Mansion House speech, only a few months before the financial crisis began, Gordon Brown declared: “I believe it will be said of this age, the first decades of the 21st century, that out of the greatest restructuring of the global economy, perhaps even greater than the industrial revolution, a new world order was created.”

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The remorseless expansion of consumer credit across the West masked the inherent flaws of global capitalism. Even before the 2008 financial crisis, nationalism was resurging in Europe (Italy’s Silvio Berlusconi, Austria’s Jörg Haider, and France’s Jean-Marie Le Pen) as income inequality rose, unemployment remained high, and unease over mass immigration and free movement hardened.

Western voters have since the financial crisis endured the slowest economic recovery in history, with living standards in many countries (including the UK) still below their pre-crisis peak. In such circumstances, the surprise perhaps is that the revolt against liberal democracy has not been greater.

The same complacency that led to the financial crisis inspired other utopian projects. The EU created a single currency in the mistaken belief that a monetary union could function without a fiscal and full political union. The US invaded Iraq (and destroyed the infrastructure of the Ba’athist state) in the belief that liberal democracy could be imposed through violent conflict.

Yet liberal democracy remains the world’s most successful political model, and market forces have helped to reduce global poverty from 36 per cent in 1990 to just 10 per cent today. The pro-democracy revolts in Hong Kong and Lebanon, like the 2011 Arab Spring, reflect the enduring appeal of popular sovereignty. Rather than the reversal of globalisation, what we may be witnessing is its rebalancing. States must take greater account of voters’ desire for economic security and global institutions must better represent their members. The age of liberalism is not over – but the age of liberal triumphalism should be.

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This article appears in the 06 Nov 2019 issue of the New Statesman, What went wrong