Community, Nation, Economic Nationalism

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Cassandra Carr
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1 Community, Nation, Economic Nationalism

2 Today s menu What do the political economy of Freedom and Equality Leave out? Emotion, security, cooperation, heroism, solidarity, end of alienation Humans long for community Rousseau: Humans need community to survive Communitarian Theory General Will Gift economy Problem of Collective Action in Communities Overcoming collective Action Problems Role of culture Role of Authoritarian leadershiip Nation as Community Importance of a common identity How to create it Mystical nature of National identity How the Nation Departs from Community: Role of the State Tensions in Liberal Nationalism The Nation in the international economy: Economic Nationalism Assumptions: Power and Anarchy Anarchy prevents cooperation Policies Self sufficiency Protection, control, warfare Size and structure Liberal Response

3 There are problems with Equality, just as there are with freedom!

4 In Liberal Theory, Freedom Trumps Equality but also trumps community Community Equality I m Free!

5 In Distributive Justice Theory, Equality Trumps Freedom AND Community..why? Community Equaltiy Freedom

6 But Freedom and equality are not enough. Why Freedom might not be the most appropriate allocative principle The focus on reason leaves out emotion or a set of higher principles to guide human behavior. the focus on freedom leaves out the human need for security Market makes no provision for community solidarity The cash nexus destroys solidarity Focus on the individual leaves out community The focus on competitiveness leaves out cooperation and heroism Maybe consideration for higher principles, security, human solidarity, and cooperation should also guide allocative systems But are these things compatable with the Market?v

7 Whole chunks of human experience that liberalism and distributive justice leaves out.. Freedom leaves out important social needs All behavior is reduced to private choices The good of the community is identified only with those individuals who are effective competitors in the struggle for life. All rationality, no emotion All law, no heros Markets insecurity, fragmented community Equality All class conflict, no feeling of human solidarity Class conflict fragmented community Equality does not erase alienation Even Roemer admits that equality does not create communal solidarity

8 The market encroaches on all aspects of human life and robs us of our sense of human solidarity Family, local community, church, and the whole network of informal interpersonal relationships have ceased to play a determining role in our systems of mutual aid, education, recreation, even work.

9 But Humans long for community People crave for an identity bigger than themselves This was Marx s utopian vision this is an age of economic interdependence and Welfare States but also an age of spiritual insecurity

10 And Rousseau says: Individuals need community to survive Back to collective action! Each of us puts his person and all his power in common under the supreme direction of the general will, and, in our corporate capacity, we receive each member as an indivisible part of the whole. Like sticks in a bundle: Stronger together!

11 What Rousseau s General Will might look like..extreme community: the gift economy social status depends more on what you give away than what you keep gifts bind people together, encourage diffuse reciprocity, and support a concept of property that resembles stewardship more than ownership per se A Gift Economy may be emerging in the subculture of programmers

12 If the market is not natural, Could a gift economy satisfy human needs and desires?

13 If not with price, how is value determined?

14 Communitarian Theory People act in communities do not calculate indi costs and benefits stewardship rather than property rights Gift economy

15 Communitarian Theory (cont.) Little need for markets Value is not determined by price Collective action/cooperation possible without authority A New Political Economy? Better life for all?

cooperation is tried, there will be lots of free riders No social costs for

16 What about collective action problems? the typical participant won t cooperate that much it s not rational If cooperation is tried, there will be lots of free riders No social costs for narrow self-interested behavior Large groups trying to cooperate can t act efficiently Selfless behavior is not even praiseworthy.

17 Lee Kuan Yew thinks so. In fact, markets and community can be combined!

18 Community and Culture.Some cultures believe community is the best allocative principle Lee Kwan Yew: The liberal tradition claimed that human beings had arrived at this perfect state where everybody would be better off if they were allowed to do their own thing and flourish. It has not worked out, and I doubt if it will. Certain basics about human nature do not change. Humans exist only in a social context community more important than individualism (agrees with Polanyi)

19 Community is more important than Freedom Eastern societies believe that the individual exists in the context of his family. He is not pristine and separate. The family is part of the extended family, and then friends and the wider society. there is grave disquiet when we break away from tested norms, and the tested norm is the family unit. It is the building brick of society. "too much" democracy and "too many" individual rights destabilize social order.

20 Xiushen qijia zhiguo pingtianxia. Xiushen means look after yourself, cultivate yourself, do everything to make yourself useful; Qijia, look after the family; Zhiguo, look after your country; Pingtianxia, all is peaceful under heaven.

But Isn t freedom more conducive to growth than government control over behavior? A key ingredient of national economic success in the past has been a culture of innovation and experimentation.

21 But Isn t freedom more conducive to growth than government control over behavior? A key ingredient of national economic success in the past has been a culture of innovation and experimentation. During their rise to great wealth and power the centers of growth -- Venice, Holland, Britain, the United States -- all had an atmosphere of intellectual freedom in which new ideas, technologies, methods and products could emerge. In East Asian countries, however, the government frowns upon an open and free wheeling intellectual climate. Does this create a productivity problem?

22 No..says Lee Kwan Yew East Asians, who all share a tradition of strict discipline, respect for the teacher, no talking back to the teacher and rote learning, ---have all been innovative..

23 But is he wrong? Because of the collective action problem, does community as an allocative principle always require absolute authority? I'm not convinced that one-man, one-vote is the best. we would have a better system if we gave every man over the age of 40 who has a family two votes because he's likely to be more careful, voting also for his children.

24 So he advocates another form of political economy combining markets with community Don t people in groups need to create hierarchies of authority in order to cooperate? (the collective action problem) So Singapore is a market economy with an authoritarian government A dominant leader solves the collective action problem Nations as communities always require authority

25 The Nation as community Nations are a community of strangers tied together by a common identity

26 The Creation of a Common Identity. How? Common symbols and myths Common language Common ethnicity Common religion Sense of common history and culture Sense of belonging to a particular land

27 Emotion, land, tradition, religion, sense of historical mission, "My country 'tis of thee, sweet land of liberty, of thee i sing." Land of the Pilgram's pride, land where my fathers died, from every mountain side, Let freedom ring. My native country thee, Land of the noble free Thy name I love. I love thy rocks and rills, Thy woods and templed hills, My heart with rapture thrills, Like that above. Our fathers' God, to thee, author of liberty, to thee we sing. Long may our land be bright, with freedom's holy light; protect us by thy might, Great God our King.

28 National Identity is mystical The identity is not an accident but a mystical given National uniqueness Nations have souls

29 Nations are communities that fill the vacuum left by liberalism and distributive justice They evoke emotion, not reason They evoke solidarity They provide an identity bigger than ourselves They provide security They provide an arena for cooperation

30 But they depart from community in many ways Often hierarchical: nations create states Keynes: The decadent international but individualistic capitalism, in the hands of which we find ourselves... Is not a success. It is not intelligent, it is not beautiful, it is not just, it is not virtuous, and it doesn t deliver the goods. Krasner: Stupidity is not a very interesting analytic category States seek power, growth, social stability

31 Liberal nations are In tension is liberal nationalism possible? Property rights, markets are possible in national communities but threaten them

Nationalism in the International economy Robert Reich s question Which world would you prefer living in--a world in which every American is 25 per cent wealithier than now and every Japanese is much

32 Nationalism in the International economy Robert Reich s question Which world would you prefer living in--a world in which every American is 25 per cent wealithier than now and every Japanese is much wealther than the average American, or in one in which Americans are only 10 per cent wealther than now but ahead of the average Japanese? Those who prefer the first world are liberals and those who prefer the second world are economic nationalists.

33 economic nationalism in the international economy States are main actors They care about their community and want it to grow They pursue power to protect the community even from markets They want influence over other states to make themselves richer

34 Assumptions about international system States pursue power to protect the community even from markets They want influence over other states to make themselves richer at their expense

35 Nation-states want influence and power. Why? Because of Anarchy No government over states States compete with each other to survive International trade is a PD game

36 Anarchy prevents cooperation YOU Cooperate (free trade) Defect (protectionism) ME cooperate Defect (protectionism) 5, 5 Comparative advantage Growth for all 3,0 You keep your market open, I close mine, I win, you lose 0,3 I keep my market open but you close yours; I lose 3,3 We both close our markets; you close yours, I retaliate, you retaliate, and so on..more free trade

37 Why national self-sufficiency? It leads to peace. Why? It protects the community s ideals

38 Are self-sufficiency, mercantilism, and economic nationalism the same thing? Keynes doesn t think so. He equates economic nationalism with Stalin and Hitler s dictatorships, but wants national self-sufficiency. Mercantilism and neo Mercantilism Can economic nationalism cover both selfsufficiency and mercantilism? We will treat it that way here..as an unbrella concept

39 Policies: Protection, Market Control, economic warfare Protect the nation s economy from others in the market Tariffs Non-tariff barriers to trade Market Control Subsidies Dumping monopoly Economic Warfare embargoes Retaliation

40 Protectionism

41 Policies: Market Control

42 Policies: Economic Warfare: embargos

43 What policy you pursue depends on how big you are Trade gives small states more benefits than large ones Trade enmeshment isn t good for any state s social stability, big or small Large states can easily close their markets, small states can t. Large states can use their markets to create political influence, leverage They can also use their resources to create a liberal international economic system. Can offer it s open market, cheap exports, trade finance,

44 The liberal response Lower aggregate wealth Consumers are hurt Liberal trade helps the nation: a blessing

45 The End

Community and Nation

Community and Nation Political Economy of Community: Basic Principles Instead of the individual or class.. everyone is equivalent and undifferentiated Instead of rational self-interest, profit or class