Date: Mon, 14 Aug 2000 23:51:17 -0500 (CDT)
From: Michael Eisenscher <email@example.com>
Subject: Stratfor Analysis: Presidential Campaign
Stratfor.com's Weekly Global Intelligence Update - 14 August 2000
The Next President. The Unspoken Issue: The Impact of Globalization
Weekly Global Intelligence Update
14 August 2000
Last week, The Weekly Analysis probed the underlying foreign policy
challenges of the American presidential election. This week, the
second part of this series examines the most potentially divisive -
and unspoken - issue of all: globalization. As the Democratic Party
meets in Los Angeles, this issue is at the root of the next
president's choices on foreign policy. And this is the one thing
neither major candidate will dare discuss.
With the economy booming and foreign dangers distant, the American
presidential campaign is unlikely to attempt to move many voters
with issues of foreign policy. This reflects an elite consensus on
U.S. foreign policy: The international system is driven by
economics, which is increasingly global, integrated and
interdependent, and this is all for the good. This has been the
American elite consensus for a decade.
But there is a powerful undercurrent running both through American
politics and politics abroad, one that angrily and profoundly
rejects this narrow economic prism for viewing the world. The speed
and power of the flow of capital in the last decade has raised
economies - and destroyed them. In the United States itself, a
small, noisy but potentially powerful movement is rising, rejecting
the cliche that a rising tide lifts all boats. Some, the leaky
ones, get sunk.
The effects of globalization are among the most important legacies
of the last decade. And yet they are the ones that are either
accepted as undeniable fact by proponents, in multi-national
corporations and government, or swept under the rug.
This is the case in the American presidential campaign: Both major
candidates running for office offer the same foreign policy. Only
one man will be president, and he will have to wrestle with the
effects of globalization, both at home and abroad. And yet neither
will talk about it. It is unlikely that at any time this week in
Los Angeles, Vice President Al Gore will stop to publicly dwell on
how badly the Thai economy has been ravaged, or how dislocated U.S.
workers will find their place in the information economy.
The primary mission of Washington's foreign policy has been to
prevent side issues - like political-military ones - from
interfering in the expansion of the world trading system. As a
result, questions over Taiwan or human rights have been essentially
shut out of the dialogue with China. Exceptions can be found in the
rogue nations, led by governments impervious to economic pain and
subject to sanctions and military action at the hands of the
The result of this strategy is a remarkably contiguous U.S. foreign
policy since the end of the Cold War, whether steered by the Bush
or Clinton administrations. Both did everything possible to prevent
the disruption of relations with China. Both have done everything
possible to use institutions - like the International Monetary Fund
- to diffuse power from individual nations. Under Republican and
Democratic presidents alike, Washington led coalitions to war
against rogue countries like Iraq or Yugoslavia, or to control
dysfunctional economies, like Indonesia's.
In the 2000 campaign, both George W. Bush and Al Gore are
completely committed to the pursuit of this same foreign policy.
This is the ideology not only of the American elite, but the
ideology of the global elite, as well. Indeed, it is not only an
elite perspective. In advanced industrial countries, this ideology
has mass appeal.
But it does not have universal appeal. Throughout the world, there
are groups, though marginal, that are deeply opposed to this
ideology. Moreover, the application of this ideology is
increasingly difficult for major international leaders. Russian
President Vladimir Putin and Chinese Prime Minister Jiang Zemin are
examples of leaders torn by a globalist ideology they genuinely
accept - but find increasingly painful to pursue at home.
Two forces are in play against globalization. First and most
immediate, are the national interests abroad. It is possible to
quickly construct a patchwork map of places essentially wiped out
or left behind by globalization. This includes much of Northeast
Asia in 1997, all of Southeast Asia even today, the whole of South
Asia, with the possible exception New Delhi, nearly the entire
African continent and at one time or another huge swaths of Latin
America, including Mexico and Brazil. All in all, nearly 1 billion
of the earth's 2 billion people have been hit head-on by the wave
of creative destruction.
Second, are the social movements within nations that represent
classes harmed by globalization and objecting to it on their own
ideological grounds. This opposition is far from dominant but it is
there, it is real and it can be heard.
In fact, it promises to be loudly present outside the Democratic
National Convention in Los Angeles this week, where tens of
thousands of protestors will provide flashbacks of the World Trade
Organization protests in Seattle - only to be dismissed as a
meaningless movement of malcontents. Malcontents they may be.
Meaningless? In this election, almost certainly. But meaningless in
the long run? No.
The central thesis of globalization is this: Removing barriers to
trade will increase the collective wealth of humanity.
Underpinning this are three prior assumptions:
1. Economic well-being is by far the most important consideration
in social life. The ideology of globalization assumes that national
impulses are primitive, tribalist hangovers and that the desire of
say, Indians to have an economy not dominated by German
corporations is a disease to be cured.
2. Economic growth is desirable regardless of social disruption.
The United States came into existence as a social disruption and
has institutionalized it. While it works in the United States it is
not clear that disruption will work equally well elsewhere.
3. The distribution of economic benefits is less important than the
aggregate benefits of free trade. Unsophisticated advocates ignore
harm and look at total growth rates. More sophisticated advocates
acknowledge harm and emphasize the need for all to benefit - but
they ignore relative growth inside and between countries.
In short, globalists are simply and willfully ignoring the
realities of politics.
To them, nationalism is a bothersome annoyance. And yet, the most
important lesson of the 20th century is that the proletariat does
have a country and that national loyalty is more important than
class loyalty. Both world wars and the national uprisings against
the Soviet empire are proof enough. Ironically, it was the greatest
classical economist, Karl Marx, who memorialized a phrase now
essentially etched on Wall Street and Pennsylvania Avenue alike:
"Capital has no country."
In reality, though, Marx and enthusiasts for globalization aside,
nations do matter. And within nations, the sense that leaders have
betrayed the national interest in favor of an internationalist
ideology also matters. This does not matter nearly as much during
times of wild prosperity - as the United States is experiencing
today - as it does during periods of economic pain.
But even in a period of tremendous prosperity, witness the two
marginal candidates in the presidential election: Pat Buchanan and
Ralph Nader, two men with diametrically opposed personal and
political histories, who have arrived at very similar positions on
globalism and nationalism. The rhetoric differs; Buchanan sounds a
nationalist note where Nader sounds a class tune. But both strike
out at the consensus on globalization represented by Bush and Gore.
These movements are certainly marginal today. That does not mean
they will remain so, however. The global economy is increasingly
out of synch, de-synchronized. The enthusiasm for globalization in
the United States is not reflected in Asia. In the heart of Europe,
in Austria, a major nationalist and definitely anti-globalist
movement has achieved striking electoral success in the midst of a
barrage of criticism from the rest of Europe. In Latin America,
indigenous movements, students and others have sounded their
The kind of growth rates being experienced in the United States
today will not - cannot - last forever. What goes up must
eventually come down. Certainly, the core prosperity will continue
for several years, but given coming demographic shifts - the
impending retirement of the Baby Boomers in the United States - it
is reasonable to expect major secular shifts in the American
economy over the coming decade.
And the withdrawal of vast amounts of money from the capital
markets will create a different political dynamic in the United
States - both at home and abroad. The great American geopolitical
choices in the coming decade are withdrawal, collective security
and balance of power. When things cool, choices will have to be
made - not merely about economics, but about security and politics.
At that point, later in this decade, the advocates of globalization
and those suspicious of it will clash, both abroad and in the
United States. The next American president - unlike his two most
immediate predecessors - will have to wrestle with this powerful
conflict. For the first time the elite will find that their
approach to foreign policy is not universally supported; those
masses that have bought into it will begin to second guess
themselves - and their leaders.
The two major parties will at that time be caught in the cross
currents. Republicans who helped foster a global economy will be
forced to defend it. But the Democratic Party will stand to lose
the most. After all, it has hammered an unwieldy coalition out of
the financial elite in New York and labor unions in Michigan. That
coalition will be stressed severely, when the dynamics of
globalization begin to change.
Regardless of the party in power, the president - whether the
occupant of the White House in 2001 or his successor - will be
forced to readdress the foreign policy that has so easily
underpinned successive administrations. Coalitions will be harder
to forge, multinational institutions will be even more unwieldy.
Close allies will become fierce economic competitors.
Already, these currents are building like eddies in the backwaters
of a great river, in places as disparate as Jakarta and Vienna. And
in Los Angeles, too. Whether you agree or disagree with the
demonstrators in Los Angeles is irrelevant. Listen carefully to
them. They will be vying for power in the United States in the
coming generation, and holding power elsewhere. The debate over
foreign policy will no longer be between left and right, but
between globalists and their critics.
(c) 2000 Stratfor, Inc.
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