Economic nationalism and global (dis)order
01:24:11 Share

Welcome to the LSE events podcast by the London School of Economics and Political Science. Get ready to hear from some of the most influential international figures in the social sciences. Good evening. Welcome to LSE for this hybrid event. My name is Katerina Dallacora and I'm an Associate Professor in International Relations in the Department of International Relations at LSE.

I'm very pleased to welcome both our online audience and our audience here in the Old Theatre today. It's lovely to see you all. We are joined by our speaker, Robert Faulkner, who is Professor of International Relations at LSE and the Academic Dean of the Trium Global Executive MBA. Robert held academic positions at the universities of Oxford, Kent and Essex before joining LSE.

He was a visiting scholar at Harvard University and Simone Weil Fellow at Ludwig Maximilian's University in Munich. He is currently a distinguished fellow of the Munk School of Global Affairs and Public Policy at the University of Toronto. Today's lecture, titled Economic Nationalism and Global Disorder, is part of our Martin White Memorial Lecture Series.

This is a biennial lecture which celebrates the life and achievements of Professor Martin White, a seminar figure in the development of international relations theory in Britain and a member of the International Relations Department at LSE from 1949 to 1962.

The Martin White Memorial Lecture is supported by the generous gift of the Martin White Memorial Trust and we are very pleased to see members of Martin White's family here in the audience with us this evening. The lecture will be based on Robert's new co-authored book, co-authored in fact with Professor Barry Buzan, who is with us this evening.

The book is called The Market in Global International Society: An English School Perspective on International Political Economy. And it explores the rise of economic nationalism amidst growing geopolitical rivalry. That's the lecture itself. So following the lecture by Robert, which will be about 50 minutes, we will then move to a Q&A

which will be both from the online audience and from you here in the Old Theatre. For our online audience, you can submit your questions via the Q&A feature at the top left of your screen. Please let us know your name and affiliation when you submit your question. For those of you here in the theatre, I will let you know when we will open the floor for questions. If you can raise your hand and wait for the microphone, please.

I will ask you to provide your name and affiliation before posing your question, and I will respectfully ask you to pose questions rather than make statements. I will try to ensure a range of questions from both our online audience and our audience here in the theatre. For Twitter users, the hashtag for today's event is at #LSEEvents.

Please note that this event is being recorded and will hopefully be made available as a podcast subject to no technical difficulties. Thank you very much and I'm now delighted to hand over to Robert.

Thank you very much, Katharina. Thanks for the kind words and the warm welcome. Thank you all in the audience. Great to see so many of you here. It's a Monday night at the end of the exam period, so that's much appreciated. And it's an honor to give the Martin White Memorial Lecture. We have members of the family here, and I really appreciate that. You're more than welcome. I should mention up front that the first time I encountered Martin White's work was

was only after I moved to the UK in the 1990s to pursue my DPhil at Oxford University. My supervisor was Andrew Harrell, and I see Adam Roberts in the room, who was one of my teachers at the time as well. Andrew, of course, a leading representative of the English school at the time, and he himself gave the Martin White Lecture back in 2006.

So this was the first time I encountered not just Martin White's readings, which were very much on the syllabus back then in Oxford and I assume still today, but I encountered the English school more widely. As is the case with many IR students even today, the very first essay of Martin White's that I read was on why is there no international theory. To be honest, this was a somewhat disconcerting reading experience coming straight from Germany.

After all, I had left Germany not least to move to a country which, as I thought, is the home of international theory. So to be told by Martin White that there was none was frankly a little bit unsettling. But I persevered and soon it became clear to me that what White had in mind was that there are different ways of theorizing international relations and that the English school did indeed deserve a closer look despite my initial interest, which was primarily

in international political economy. So that was my first encounter and I've since come back many times to White's work. Now the focus of my lecture, as you all know, is on economic nationalism and international order or disorder. And those of you who are familiar with White's work have good reason to be surprised about the choice of my topic because after all, Martin White is not known to have spent much time thinking and writing about international economic affairs.

In their introduction to White's first book, "Power Politics," which was published, I think, about six years after his death, Hedley Bull and Carsten Hohlbrad note that the book is, quote, "saying very little about the economic relations among states, or more generally about the economic aspects of world affairs." The editors of the book go on to note that by the 1970s,

economic matters have become an inseparable part of international politics. And that White's approach was already out of step with the then prevailing approaches. Now, to be fair, White was not unaware of the growing attention that scholars were paying to economic matters. It was just that he greatly disliked the intrusion of the modern social sciences and especially economics into IR.

To give you a flavor of his dislike, let me quote from a paper he wrote in the mid 1950s where he somewhat sarcastically noted, "We cannot construct indifference curves for the state's choice of one alliance over another or express graphically the diminishing marginal utility of non-aggression."

White also, I should add, rejected what he felt were largely reductionist theories in IR that tried to explain wars with reference to the economic struggle for markets and raw materials or the contradictions of capitalism. So there was a recognition of the importance of those theories, but at the same time a complete dismissal of any such approaches.

So it's not surprising perhaps that we find relatively little economic content in White's writings. And perhaps the same could be said and can indeed be said about the English school at that time from Charles Manning to Hedley Bull. However, if we look more closely at White's work, and much of this is now published,

Oxford University Press has done a great job bringing together many of his writings in collected works. These are the book covers of his first posthumous publications. If we have a closer reading of his work, we do note that the economic aspects of international relations feature somewhat more than perhaps even Hedley Bull was aware who edited much of his early work.

we can find across scattered his many writings a few hints at what might become a fuller account of the economic force in international relations. Let me just give you a few tastes of that. So, for example, in power politics, White speaks of commerce alongside diplomacy as one central aspect of the organized system of continuous relationships between powers.

So in his historical account, for example, he notes that medieval Europe had relations with the Islamic world both through war and commerce, and it was trade that connected Europe in medieval times before colonial expansion with China and East Asia.

At other points, White points to the economic resources and industrial production as central components that make a country a power in international relations.

And indeed, in his discussion of the arms races that many great powers have engaged in, he points out that the stronger power will always wish to retain the technical lead over others as the source of its predominance. So again, he paid close attention to the importance of economic might as part of the power politics game.

And also in his historical writings, we find references to the growth of international trade and global markets more generally as a key driving force behind the expansion of Europe's Western international society. So for example, he mentions the outward push for natural resources as, quote, "the principal reason for the partition of Africa and the Near East in the 19th century."

So what you get if you pull together these isolated references is almost a kind of a framework that he could have developed for the English school of thinking through the economic factor in international relations. Those are the three elements that are starting to come out. This framework would include, first of all,

close attention to reference to economic exchange, trade, financial flows and so on, economic interdependence as a key element of international society. Secondly, the close link between economic power, political and military power, and then of course the peculiarly economic logic behind the expansion of international society to global scale.

So there is, in a nutshell, an English school framework. It's just that White, together with many of the other English school theorists of his time, didn't feel it needed exploring. He showed no interest in developing such a framework. So we have references to commerce potentially being one of those key elements of the normative structure of international society, but that's never followed through and never developed. Well,

I say with a smile, and I'm now looking at Barry, until now, because here comes the commercial break. Barry and I started some years ago to pay close attention to what the English school might have to say, but also might have to learn from the economic sphere. And so we've produced over many years

a book length treatment of that subject which tries to develop a full scale English school approach to international political economy.

Now, don't worry, I'm not going to spend the rest of the lecture going through the 300 pages, 200 years, and with Barry's help, an excursion into pre-modern economic history. But let me sketch just a few of the key arguments we make in the book, because that will be, for me, the jumping off point for my lecture later on. So the main argument can be summarized

At least in a few bullet points. There's more to it. I recommend you read the book, but let me make those points.

The main argument we make is that the market representing the economic system that we have seen to come into existence since the 19th century should be thought of as one of the primary institutions of global international society. So the market not as a marketplace, a physical place, not as an economic system as economists think, but the market as a governance principle.

It's part of liberal ideology which promotes the market as a governance mechanism, central mechanisms for the economy, for society and even in extreme cases for politics. As such, the market sits alongside and interacts with other primary institutions, the political primary institutions of global international society, sovereignty, territoriality, war, diplomacy, international law, the balance of power.

And in the book we then trace how the market as an economic primary institution interacts with, rises in the 19th century, interacts with those primary institutions and how throughout the 20th and 21st century it goes through periods of strengthening, weakening, the fluctuating fortunes of the market as we describe it. And so what we can observe is that one,

there is some very strong interaction between the market, the economic sphere and the political institutions and two, these fluctuations tend to be more unusual in the markets case. It doesn't just rise and become established. It's a very demanding, a solid risk norm that is difficult to fit into the normative structure of international society.

So what the book demonstrates is that the English schools account of international society is in fact incomplete without looking at the economic sphere. But by the same token, I think we make clear that the market is always part of a larger political system, global international political system. The global economy doesn't exist in isolation.

The global economy cannot escape the reality of a state system that is characterized by the constant pursuit of power, but also by profound power imbalances between states. And we then conclude the book with an analysis of the current state of affairs and argue that the market has now, in the early 21st century, come under increasing pressure and that the pendulum

has swung back away from market dominance towards what we describe as the rise of economic nationalism, the resort to mercantilist tools, much greater state intervention in the economy and that's all signifying a shift in the normative structure of the global political economy.

And this is the point where I depart from the book and now want to look at the current state of affairs. And in what follows, I'm going to make four interlinked arguments about why economic nationalism has arisen, its political and economic roots, why it is gaining strength now and not 30 years ago, and how it is likely to disrupt and change the international order. I should say that I'm going to sketch this argument at a fairly macro level,

There's a lot of detail, a lot of disturbing detail that we are working through at the moment as the global economy is being disrupted. There's a lot of noise, therefore. I'm trying to filter through that noise to find the signal in the global economic trends that we're observing. And that's what I want to focus on. I'm sure we can complicate the picture in the discussion later on as we go on. So my first argument.

is that we are, I believe, at a watershed moment in the evolution of the international system where the old political economic order is giving way to something new, something that we are less sure about in terms of its contours. It is still hazy, but I'm going to come back to that. The point I want to make is that the rise of economic nationalism around the world marks a profound shift in the political economic

but particularly in the ideological underpinnings of the global economic and political system. And because economic nationalism is such a widely used but often ill-defined term, I'm going to start quite simply by defining it so that we've established that quite clearly. Economic nationalism is, first and foremost, an ideology. It's a political ideology in the neutral sense of the word. It explains to us how the world works and how we can navigate it.

It prioritizes a country's own economic interests and industries over those of other nations. So far so good. That is just common sense politics if you're in the business of politics. But it then involves an extensive use of market distorting measures, tariffs, quotas, bans, but also subsidies. And these are used to shield domestic industries and workers from foreign competition.

At its core is the belief that a nation should focus on its own economic well-being and achieve a certain degree of self-reliance, but that this comes usually at the expense of international economic cooperation and exchange, and that it is worth paying that price. But the important point is, and that's the last point here, is that it can involve the use of certain liberal policies at home. Economic nationalists are perfectly fine

to engage in liberal capitalist policies at home, but that cannot be tolerated at the international level. The market norm cannot work internationally and that's the critical argument that we need to take on board. So it's therefore important to distinguish economic nationalism from what people talk about, particularly politicians, of the pursuit of the national interest. Economic nationalism is of course about the pursuit of the national interest,

But the latter can very well go with integration into global markets, can go very well with the globalization story of the last 30 odd years or so. It is economic nationalism that opposes that.

Now to illustrate why I believe that profound shift has occurred and that we are now coming out of that shift and entering a new era, let me just give you two historical points from the beginning of the 21st century and the current era. Let's go back to 2000, surely the high point of globalization. Back in 2000, the US Congress passed the US-China Relations Act,

which granted China permanent most favored nation status once China was to become a full member of the World Trade Organization. And that, of course, entry into the WTO happened in December 2001. The bill, as you can see here, was signed into law by President Bill Clinton, a Democrat, though it was Republicans in Congress that made it happen.

The bill passed the House with 74% Republican support, but only 34% Democratic support. In the Senate, both Republicans and Democrats signed and supported the bill with large majorities, 90% and 80%, respectively. There were great hopes attached to China's entry into the World Trade Organization. We perhaps tend to forget that today. This would bring about a huge expansion of global markets. It would give a boost to Western exports.

and it would introduce China's abundant labor force to the global economy. At the same time, it was expected to produce both economic and political liberalization in the then largest remaining communist country in the world. Bill Clinton himself

expressed the hope that this would open a vast China market for American products, which is also what motivated, of course, the free trade caucus among the Republicans in Congress. Let me quote from that momentous signing event what Bill Clinton had to say about this.

He said, "For the first time, our companies will be able to sell and distribute products in China made by workers here in America without being forced to relocate manufacturing to China, sell through the Chinese government, or transfer valuable technology for the first time. We'll be able to export products without exporting jobs."

Now, I think we all know that's not quite how it worked out, especially the last part of that quote. But it's remarkable, this statement, because what it signified is the complete and utter consensus at the time between Republicans and Democrats, not quite all the trade unions on board, but this goes for the United States as much as for the European countries at the time, the complete consensus behind globalization that prevailed

which basically said free trade is good for growth, for manufacturing and for jobs, and market forces, the market principle had to be liberated and established, freed from government control, not just domestically as Reagan and Thatcher did in the 1980s and 90s, but also internationally, as what's going to happen now as globalization integrates the last remaining parts of the world into the global market. There was this

great sense that we had unleashed a force for good and it would indeed be foolish to try and resist it. This was known, of course, as many of you know, as the Tina Doctrine. Tina as in there is no alternative. And it was

preached by many around the world, including the World Bank and the IMF, all the global institutions of the Western liberal international order promoted the Washington Consensus, a one-size-fits-all neoliberal recipe for availing of those benefits. In 2002,

No better summary can be found of the then prevailing consensus than the words of Peter Mandelson, who of course is now ambassador of the UK to Washington, who summed it all up at a seminar that was held at the high period of the Tony Blair government when he said, "We're all Thatcherites now and we better get used to that." Fast forward now a quarter of a century, however,

that dictum, "We're all thatch right now," doesn't quite ring so well anymore. Because in today's world, again, I'll stick to the United States, we've learned that the most powerful country and the largest economy in the world

has started to upend all the orthodoxies of the past and has introduced what can only be described as the most profound foreign economic policy revolution ever undertaken in living memory in the United States. Shortly after its inauguration in January, President Trump announced that, quote, "We were at our richest from 1870 to 1913."

Before the First World War, Trump said, "We were at our richest." And that's when we were a tariff country. The second part is true. The first part of the statement is perhaps debatable. On 20th of January, shortly after the inauguration, the Trump administration then set out its new approach in a memorandum called "America First Trade Policy."

which set out a range of new initiatives to address the country's persistent trade deficit and target the unfair trade practices by other countries. And this was then followed up, as you can see here on the right of the graph, on 2nd of April with Liberation Day tariffs, when Trump introduced the most extraordinary hike in tariff rates that

He imposed on a wide range of countries from China to the EU, from Vietnam to a small group of islands populated largely by penguins. Interestingly, at the time Russia was not hit by tariffs and was left out of the Liberation Day tariffs. Trump then called on the affected countries to negotiate with the U.S.,

He gave them a 90-day moratorium. He paused the tariffs for 90 days, and this would allow the negotiations to conclude with all the countries hit by the tariffs. It's worth noting that in the past, the United States took on average 18 months to negotiate any single trade agreement. So to imagine 90 days for up to 190 or more countries.

trade agreements is a stretch of the imagination. As things stand now with the pause in place, the effective US tariff rate is roughly around 15%. So the pause is depicted here on the right. That's way up from the 3 to 4% where it was when Trump came into power.

To put this into perspective, and you see this on the graph here, this takes us back to the 1930s when the US introduced the Smoot-Hawley Tariff.

the tariffs of 2nd April not being lifted or at least paused, we would be back in 19th century territory in terms of tariffs. That just gives you a sense of the proportion that we're talking about. Now, before I give the impression that when I speak of the rise of economic nationalism, I speak of the rise of Trumpism in foreign economic policymaking, let me just point out that this is not an isolated phenomenon.

If we look at the wider picture, we should know two things. It's not just the United States that's introducing economic protectionist measures. It's also a trend that we can trace back at least 15 years. There are a couple of key turning points that we should note.

we can go back to the 2008 global financial crisis, which certainly marked the critical turning point in the globalization story. It led to an immediate de-globalization in global finance, and it also led to a leveling off of the trade-driven globalization trend.

Trade growth since 2008 has never again reached the levels it did until 2007, before the financial crisis. It is simply now in tune with the growth of GDP worldwide. It didn't help that since the early 2000s, the World Trade Organization, the one and only multilateral body dealing with trade liberalization, has failed to achieve that target, which is to conclude liberalization talks.

There is no more multilateral framework at work to drive further trade liberalization forward. We've also seen the COVID-19 pandemic disruption of supply chains, which also led governments to explore policies to ensure resilience and national security, not just in the health sector, but in other critical economic sectors too.

and then of course the first Trump administration and its trade war with China. So if you look at all these instances, you can see how governments have gradually but steadily moved into economic nationalist territory and that this trend is not a one-off caused just by one government. Now of course some of you in the audience will now want to inject and say,

Come on. Economic nationalism hasn't really dented the fortunes of the global capitalist system. Students are still rushing into MBA courses around the world. Companies are still recording, at least outside the US, pretty good profits. Suddenly Europe is up, America down, but that can change any time.

Capitalism hasn't yet collapsed. Trade flows have not completely reversed. Investment flows are still happening. There are plenty of countries, especially in the global south, that still want to integrate into global markets. Go to Singapore, go to Vietnam, go to Indonesia. What's he talking about? Economic nationalism just doesn't ring true, some of you might say, given what's going on. We haven't seen de-globalization yet.

That's a fair point. But let me therefore clarify the argument. What we are witnessing is the collapse, not of the global economy or global economic linkages, but of the ideological consensus behind the institutional infrastructure that has sustained globalization in the past. It's the neoliberal free market globalization narrative that no longer exercises ideological hegemony.

This goes for the United States, the largest economy, the most powerful nation on earth. It certainly goes for China, which likes to go to Davos and proclaim support for free markets and globalization. But that should not be taken at face value.

even in Europe where you still find the most ardent supporters of free markets and globalization, I think the tone has shifted. And if you go to Brussels, the discourse there looks very different today. So if the neoliberal consensus has ended, the question then is what's likely to take its place? And that's where we need to have a closer look at what economic nationalism means for the global economy and for international order. Which gets me to my second point. Economic nationalism...

I would argue, is not a coherent economic doctrine. Throughout its history, it has been many things to many countries. And I shall come to argue in a moment, we can now broadly distinguish between two broad strands, a revisionist, call it an offensive strand, and a more defensive posture. I'll come back to that. But let me briefly explore the roots of

economic nationalism and how we should position it within the sort of ideological field of global political economy. The problem with that is, of course, that it has meant many things to different people throughout history, but also around the world. In the IPE literature, international political economy, there's always been a tradition to place economic nationalism firmly in the classic mercantilist camp.

The problem with that is this view has focused much more on economic nationalism as a statist project of organizing the economy, right? Statism rather than nationalism. And indeed, the classic meccantalist tradition from the 16th to the 18th century was very much concerned with promoting the wealth of the state

as the basis for the power of the state. Nation states were not truly in existence. We're still talking about the pre-nationalist era and the emphasis was on the state shaping the economic system, intervening in trade, in investment flows, in the organization of the domestic economy so as to maximize national wealth which would boost state power.

If there's one key idea that today's economic nationalists, including Donald Trump, take away from this kind of thinking, it's of course the idea of the economy as a zero-sum game. One nation's economic gain is another nation's economic loss. The idea of the global economy as a fixed entity, and you need to grab as much of it as you can with whatever tools that you have. That's classical accountalism.

By the 19th century, things have moved on. That's the period when nationalism first leaves its imprint on international society, as James Mayer has written, but then also on the global economy and economic policy.

This is the moment when economic nationalism takes on a much more explicit focus on building the nation state and developing the national economy. So, neo-mechanicalists in the 19th century, Alexander Hamilton in the United States, Friedrich List in Germany, were concerned with a developmental project that looked at developing a nation as a coherent economic space.

that would have to some extent boundaries to protect it against other nations. This was about tailoring economic policies to the unique characteristics of a nation's culture, its proclivities, its traditions and so on. This also means that the policies that neomechanicalists could use to further the interests of the nation state could vary hugely. And that is of course the essence of nationalist thinking.

They could also, as it is the case with lists thinking, for example, lead to a national development program that would prepare the nation for eventual takeoff and entry into global markets. Germany's and America's problem in the 19th century was not that they didn't like liberal ideas of free trade and free exchange. The problem was they couldn't yet compete with Britain that dominated global markets.

And so neomechanicalists were in many ways much more pragmatic about the phasing of the evolution of national economic development policies. If liberal global exchange was to be had at the end, so be it. Let's take this forward to the 20th century.

Neomechanism survives into the 20th century, but it is now mostly taken up in the developing world. Most economic nationalists in the 20th century are those that represent poorer nations and want to catch up with the industrialized world. For some, this is about decolonization.

throwing off the yoke of colonial rule which also means getting rid of multinational corporations and external dependence. In China, under Chairman Mao, this means a radical program of autarchy to develop domestic industries and avoid entanglement with foreign interests, economic, political and otherwise.

But in South Korea, if you look at the policies pursued under Park Chung-hee, the probably most successful military dictator in the economic nationalist camp, that was an initially highly nationalist program, but one to develop an export-oriented industrialization program.

So here you see the huge divergence among economic nationalists between pure autarchy and isolation and a much more expansionist program of integration into the global economy. Both have worked, in China's case, only after they changed course. This leads me then to a fundamental rift in the economic nationalist tradition.

And I point here to the work by an economic historian, Martin Suse, who's written a marvelous book called The Nationalist Dilemma, came out two years ago, which I highly recommend, which traces nationalist thinking in economic affairs through the last 200 years. The point that Suse makes is that within all the variety of nationalist positions that these countries take,

we find two broad motivations that countries take. One is the isolationist motive, the autarchy drive that prevailed under Mao in China. This is about essentially making sure that the national economy is built up but is also independent. It's about promoting the individual welfare of the citizens of the country irrespective of the place of the country in the global economy.

This is about resisting globalization. It's about avoiding exploitation by foreign economic interests. This is where nationalists really zoom in on trade protection, on capital controls, restrictions on migration, shutting the border. This has been a constant theme throughout the history of economic nationalism. But there's then also throughout the history of economic nationalism a different motive, something I've alluded to already, the expansionist motive.

This is a desire for national growth rather than individual welfare. This is about policies that allow the country, the nation, to catch up with other nations. It brings in the comparative dimension to where your own nation stands relative to other nations. It's about preparing the nation for a more expansionist economic program that eventually leads to global market integration and indeed international competition.

And as Martin Sousa in his book points out, the dilemma for nationalists is, in most cases, you can't have both. Many nationalists start out on these isolationist front, but are tempted to move forward to a much more expansionist program. Indeed, we have an example of this in the case of the United States, which in the 19th century undergoes that kind of intellectual transition.

I hope I'm not offending any Americans in the room with this crude depiction. It's not mine. It's from a 19th century cartoon. But everyone gets the idea of what happened with America. It just grew

richer, wealthier, fatter, and a bit more expansionist. We see Uncle Sam there with a gunboat, at least it looks like a, not quite, it still has sails, but underneath 1899, the first colonies start appearing. Cuba, the Philippines, and Puerto Rico.

And so the United States is exactly the archetypical nationalist country that decided for itself that it would become an expansionist rather than isolationist economic nationalist country. We could look at China's developmental path too. It underwent the same kind of transformation from Mao to Deng Xiaoping.

And it was only under Deng Xiaoping's reforms. Admittedly, some of them started under Mao in the last few years. Again, there's a marvelous book by Arne Vestert, former colleague who's unearthed some of that story. But it's then under Deng that we see that shift towards a much more expansionist story of economic nationalism being played out. Interesting enough, this is also, I think, the dilemma that's currently played out in Washington, D.C. Now, I don't have a

a first row seat in the White House, but this is exactly the kind of debate I imagine going on between the MAGA wing that would like the Trump policies to be exactly about erecting walls, tariff walls, shutting out foreigners, focusing on raising the individual welfare of Americans, the left behind.

and those that want to intervene in the economy to use targeted intervention to boost, strategically boost the American economy to ready it for great power competition with China. That's a nationalist policy too, but radically different. Perhaps you do need those Indian and Chinese immigrants in Silicon Valley if you want to beat the Chinese at the technological competition. And if we fast forward now to today's world,

I would argue that in a similar fashion, a new divide has opened up between economic nationalist countries and others that are pursuing such policies for different purposes. The strange thing about the current situation is perhaps that while in the past economic nationalism was pursued by the weaker nations that sought catch-up trade...

It is today the richest country in the world, the most powerful country in the world that seeks to upend the existing consensus and destroy what institutions we've built up.

In the 19th century, it was America and Germany that sought to catch up with Britain at the time. In the 20th century, it was developing countries, the East Asian tiger economies, it was China that tried to catch up and resorted to nationalist policies against the then dominant player, the United States. But today, it is the United States as a dominant power in the international system that has taken that turn towards nationalism.

It's partly because of a peculiar feeling of economic vulnerability, of having lost out in the global economic race, which is certainly motivating Trump's trade policies. But it's also about a bigger project of remaking the global political economy. And this is what's so unique about the current experiment that I don't think we've seen before to the same extent.

that the leading economy wants to reshape the global political economy along its own preferences in a very nationalist way that's destroying what we've come to know as U.S. preferences for a rules-based international economy. And I've listed some of the key features of the policies that are being pursued at the moment that give you a sense of what the new rules of the game will look like. Trade bilateralism rather than multilateralism.

a sharp focus on preserving technological superiority, a rush to secure resource access, whether it's Greenland or somewhere in Africa, the weaponization of global linkages, of interdependence at a level that we've never seen before, and of course, a deliberate effort to actually slow down other countries' rise to prominence in that system. Now, this means for other nations

that they are forced, most likely, into a nationalist outlook too. And this is where the revisionist defensive divide matters. Now, we see this playing out very clearly in the European case. If you talk to European policymakers and analysts, none of them would argue that they wanted this to happen

And many of them are desperately trying to hang on to whatever remains of that liberal international order, the multilateral trade and finance order we've still got here and how we can preserve that. But if you look at the debates that are going on in Brussels, it's about industrial strategy. It's about the creation of national industrial champions, right? The Airbus of dot, dot, dot of everything. It's about selective, yes, selective trade protection.

It's about security-related investment screening. And all of these policies are now common currency as Brussels tries to formulate a more long-term strategy for itself. And that leads me to my third argument, which is that, quite simply, this is not an aberration. Whatever happens in the next US election is not going away. That economic nationalism is here to stay.

That's why I'm so confident to argue that we've seen a watershed moment break loose here that is producing a shift in the ideological foundations of the global political and economic order. I'm going to give you two arguments behind that and I think I owe you that. It's one for domestic reasons but then for international reasons. What about the domestic reasons? A common response to the current

approach that the Trump administration is introducing is to argue, oh well, it's just not going to work, right? The economic toolbook that they're using is flawed. Trade protectionism is not going to produce the results. The jobs are not just coming back. Sooner or later, somebody in the White House will wake up and say we need to change course. If you read Wall Street analysts

and their predictions after the inauguration in January. Anyone intending to become a Wall Street analyst in the audience? No? Okay, don't be shy. They unanimously, without fail, predicted that whatever Trump had said about trade protectionism wouldn't happen, right? The motto was, this will blow over. Don't worry. Leave your assets with us. We know how to invest them.

Scott Besant, he's the adult in the room. He knows how to handle Trump. I was recently at a conference where someone from Blackstone sitting next to me said that they spent a lot of money on that advice and he said to me rather pleasingly, we should have listened to academics instead. I couldn't possibly disagree with him.

So there's that argument that the policies won't work. Well, shall we look at them? I think there is indeed good reason to expect this won't work, right? It's certainly tempting to take that view because after all, the economists here at the LSE have written extensively about why it won't work, right? The way the Liberation Day tariffs were calculated makes no economic sense. There is no logic to these randomly picked tariffs.

Trump's focus on bilateral trade imbalances, goods trade, misses the bigger picture. One, that the US is of course running surpluses with many countries when it comes to services trade. But also, he needs to look at the bigger picture of an interdependent economy where trade imbalances balance themselves out across the field.

Manufacturing jobs will only come back if you have corresponding policies to train people and to invest in those factories at home.

The income from tariffs will never replace income from general taxation, as might have been in the 19th century. And once other countries start retaliating, those incomes are not materializing, and the US economy will head south anyway. So I don't think I need to labor that point. It's easy to dismiss nationalism on economic grounds. But the point I want to make is that

There is good reason to see trade and financial and other benefits from, sorry, costs from trade policy working into the economic calculation and political calculation in Washington. But what is clearly happening is that we have a system in place that it makes for bad economics, admittedly, but for good politics, economic nationalism.

gives you an enormous opportunity to tie together different and often disparate domestic constituencies that you can mix and match over and over again, which explains why economic nationalism has become so pervasive. There are those that want to save the workers that have lost their jobs or are suffering from precarious employment due to technological change and globalization.

There are those that want to protect national industries, whether or not they employ domestic workers, but that can no longer compete against foreign firms. You may want to protect social groups that fear cultural alienation amidst mass migration, or simply want to protect their identity in a globalizing world.

And you can make the political argument about countries whose status in international politics is under threat, who fear falling behind in the global power race and also deserve, therefore, a bit of protection. So economic nationalism thrives when in an age of rising inequalities, you can assemble a group of people that feel that those interventions might just protect them whether they do economically or not.

It's also important to note that while the arguments for protection and for nationalism are currently associated with the political right in the United States and elsewhere, they have long found support on both sides of the spectrum. So the arguments that Trump and others are making today have been made by many others before in the 1990s indeed. In the 1990s we had the same situation. Pat Buchanan

was making similar arguments to Bernie Sanders at that time. They didn't fall on fertile ground, but they were certainly popular and have had a long running history in that debate. The difference is that the circumstances have changed, inequalities have risen, economic marginalization has increased, and those arguments suddenly develop traction and make political sense.

So there's a political reason why economic nationalists are having a field day. And unless those conditions go away, I think they will continue to succeed. But there's then an international driver of this. And that's where international relations scholarship needs to come into this whole debate, which I think is somewhat missing in this.

There's an international logic that has to do with the power shifts that have occurred in the international system, the weakening of Western dominance and the reaction that this has provoked, particularly in the United States, but may well provoke in other countries too, in Europe and otherwise. It's about rising geopolitical tensions between the US and China, which have undoubtedly led to what many people describe as a politicization of the global economy.

Now, it may be ironic that the US is doing this now at the time when it has created a system that it ought to benefit from.

But it's less surprising if you look at this whole debate from a power politics perspective. The U.S. may still have amassed the greatest amount of power, militarily, economically speaking, but what matters from a power perspective is the gap, the distance in power between the U.S. and the next or the third power to come. And that gap has been perceived to be shrinking.

And that relative gains dimension is the one that international relations adds to this debate. It doesn't matter only that there are marginalized, stranded workers in America. It matters that they're also fearing that they're losing out collectively as a nation in the great power race.

To be fair, that relative gains dilemma has never really gone away. In the Cold War, it was very much alive and very much characterized the superpower relationship between the U.S. and the Soviet Union. But there was perhaps for a brief time in the 1990s and the early 2000s a moment when it seemed as if international politics had almost transcended that relative gains dilemma.

It seemed as if the liberal international order had created a framework around it that made it possible to tolerate these shifts in power. And there was something quite unique about that liberal moment, that enthusiasm that prevailed after the end of the Cold War, which saw the mutual benefits of globalization push aside any concerns for power gains and losses.

But in the new reality of geopolitical rivalry, in an international system that is characterized by what Barry Buzan describes as deep pluralism, value and interest pluralism, fundamental diversity in perspectives among the great powers in the international system, the global economy just becomes embedded in wider political structures, can no longer operate seemingly outside those political structures, and is now much more subjected to

to the power political play that we are seeing. It is power interests, not welfare interests, that have to prevail. It is no longer acceptable for the US, but also other Western powers, to let market forces dictate in this system.

Global economic flows and the distribution of the gains from global markets can no longer be left to the simple forces of supply and demand. Trade investment in financial flows, especially technology transfers, are therefore increasingly viewed through a security lens.

and where possible great powers, not just the US but others too, will want to weaponize economic interdependence, leaving multilateral principles and institutions just about alive but increasingly irrelevant to the settling of international economic disputes.

And talking of the weaponization of economic interdependence, we have good evidence to suggest that this has been underway for a long time. In the United States, it can be traced back to 9/11 when US administrations

have used extensively their central position in global financial information flows, but other countries too are using sanctions more, are using security related screening of foreign investment flows more. So this is not just an isolated US story. This is about

a creeping surveillance system that's being introduced into the global economy and that's making sure that global economic flows are increasingly subjected to those political calculations. And in this geopolitical dynamic, for as long as that persists, I would argue economic nationalism is the natural choice for governments to pursue. And that brings me to my final argument, which is about the future.

I shall be fairly brief here, because I think I need to engage the clever brains in this audience to think this through with me. So let me perhaps highlight just a few key features of what I think we are getting into. There are five points to this. If indeed economic nationalism is staying with us, then the question arises, can we hope to go back in some way to what we had before? And the clear answer has to be no.

There's just no return to the liberal international economic order. We're not going to see a restoration of either Western unity or unrivaled US hegemony. Too much power has already diffused in the global international system,

this is not just about the rise of china it's also about the rise of power number three four and five the global south looks different than it used to before and none of the policies that trump is attempting is going to change that in any fundamental way importantly perhaps

It is Western unity on what kind of global order to create and sustain that's unachievable in an economic nationalist era. We may see a relaxation of it, but I don't think we'll get back to the glory days of unquestioned unity in the West. Second, I don't think there's going to be a rival hegemonic order on a global scale by any other nation, which would be the candidate for that creation, obviously China.

But it's most unlikely that China will establish a global, not regional, a global hegemonic order either by consensus or by force.

That seems unlikely and what's more, the so-called China model or the Beijing consensus as it was once touted doesn't quite look so appealing anymore between domestic inequality that's on the rise and demographic change that's going to slow down economic development between a declining growth rate in the economy and rising ecological costs of a fossil fuel driven growth in the past.

So China is the unlikely candidate and there are no other candidates in that field. This leaves only one possible outcome for the world order, which is about both fragmentation and regionalization. The two trends go in two different directions. We are likely to see multilateral institutions frail and decline in importance.

and regional organizations and institutions and rules and treaties may well kick in and provide some respite for those that want to preserve liberal economic exchange. But globally speaking, this will be a much more fragmented global economy with multinational corporations

corporations having to work out how to navigate that scene, how to work out when to pursue regulatory arbitrage or just double down on one location or the other. So some liberal pockets may be preserved. The European Union will want to do this in Europe. There may well be an East Asian free trade zone arising, but that can never be scaled up to the global level.

The fourth point is perhaps a more hopeful one. Inevitably, economic nationalism is emphasis on zero-sum games. Relative gains will lead to more conflicts. It will exacerbate existing conflict, create new tensions. But much depends on how countries react to each other's nationalist policies. So the escalation logic is not built into that prediction. And we may well see a de-escalatory logic too.

I would argue there's even a small glimmer of hope that indeed if there is some de-linking between regional economies, this could also reduce some of the tensions that currently exist.

Nationalist governments will have to prove their own mettle in pursuing the kind of strategies they want to do and they will have to be accountable for that. And so we may see not greater but perhaps even less instability arising, though that's still quite unclear. But the last point is perhaps the most depressing from my perspective, which is that ultimately the one thing that will suffer is the provision of global public goods. Climate change,

the regulation of global technology ai will continue to become pressing ever more pressing issues but in an economic nationalist world where battles over technological dominance and economic flows prevail

it will be ever more difficult to find global rules that will be enforceable and that will apply around the world. We will end up in a regionalized regulatory world, but climate change, AI and other global challenges demand global responses, and that's where I'm most pessimistic about what kind of world we're entering into. So let me stop here. Instead of concluding with a summary of the argument, let me just perhaps state that in a few years' time, if we meet at the LSE again,

you may all concur with me in saying that, well, we are all economic nationalists now. And that's perhaps to bring back Peter Mandelson one more time. Perhaps that's exactly what Peter Mandelson whispered into Donald Trump's ear when they signed the US-UK trade deal on the 8th of May. But I don't want to leave the last word of this lecture with Peter Mandelson.

I'd rather do that by handing it back to the scholar in whose name we are assembled here today, and whose work I so greatly admire, Martin White. Now White, as I mentioned, may have downplayed the economic factor in international relations, but one thing he can't be accused of is to downplay the role of power in power politics in international relations.

And as he wrote in Power Politics, in the book version that was published in the late 1970s, every power has an interest greater than welfare, an interest on which it believes that welfare depends and to which welfare must, in the last resort, be sacrificed. The maintenance of power itself. Thank you very much. Hi, I'm interrupting this event to tell you about another awesome LSE podcast that we think you'd enjoy.

LSE IQ asks social scientists and other experts to answer one intelligent question, like why do people believe in conspiracy theories? Or can we afford the super rich? Come check us out. Just search for LSE IQ wherever you get your podcasts. Now back to the event. Thank you so much, Robert.

So I'm going to open the floor now to questions from the audience here and online. I'd like to encourage the younger members of the audience to take this opportunity to ask Robert a question. So I'll prioritize you if you put your hand up. Yes, please wait for the mic and please tell us who you are.

My name is Tayo. I'm a year 13 student from St. Olav's in Orpington. Thank you, Professor Faulkner, for the talk. I think in the beginning you said that as an economy moves towards nationalism, the rate of government spending and involvement increases. But I read also that, I guess, on the other hand, as an economy leans into liberalisation globally in terms of trade, that it has to then increase its spending to...

help the losers from globalisation. So do you think that if both are true, then there's a way for the government to shrink its spending sustainably? Thank you. I'll take a second question. Yes. Hello, my name is Adam Hopley. I'm a year 12 student at Langley Park School for Boys in Beckenham.

It's great to be here. My question concerns, to what extent do you believe that the rise of far-right governments in Europe will change the frequency and strength of economic nationalist policies across the world, and more specifically in Europe? Thank you. I'll take one from upstairs, over there, please. It's not working. Why don't you speak and I'll repeat the question. Yes, that would be a nice solution.

How's that? Yes. Oh, that's better. Yeah. Ewan Grant, UK Defense Forum. Several years working in Ukraine for the European Commission, where I saw how international bureaucracies sleepwalking in ignorance about what was going to come. My question is about organizations like the IMF and the World Bank in particular.

How do you see them adjusting to this scenario and your picture, which frankly I very much recognise that picture and I would not bet against you. Thank you. So we'll take these three and then go online please. Thank you very much. Wonderful questions. Thank you all. I didn't catch your name.

Tayo, are you signed up for the International Political Economy degree at the LSE? Not yet. You should, because your question goes to the heart of one of the interesting puzzles in global economic policy, which is that economic nationalists promote state intervention, but it's actually in the neoliberal era that we saw state spending go up, which I think goes to the heart of your question. And that is indeed one of the puzzles. What neoliberals...

didn't achieve in the 1980s and 90s is to push back the state. There are various reasons for that, right? Ageing populations, growing demands for health spending, but also the point you raised, which is that in an era of free markets...

In an era when global competition can come in and destroy your steel factory and make whole communities unemployed, we need the state to step in and defend it. So there's a kind of a social insurance element to that state spending that happened in the 1980s and 90s.

Which, by the way, interesting enough, motivates a lot of people on the, shall we say, the far right in the United States that have fed into the Trump revolution because they were frustrated with the wins that right-wing neoliberals made in the 1980s, 90s. But the one thing that didn't happen after the end of the Cold War, right? Communism failed, liberal market-oriented capitalism had prevailed, but the state just kept growing.

And that was one of the motivations behind that attack. So that's a very good observation, I would agree with that. There's nothing that we should expect nationalists to do about that, because peeling away those layers of social security is going to prove very difficult. What I would distinguish here is between nationalist state intervention in the economy

and the kind of social and public spending that has been going on for the last 20, 30 years that basically comes out of a broad political consensus among social democratic and conservative parties.

the kind of economic nationalist state intervention we're talking about is much less focused on spending, much more focused on getting rid of the market mechanism in order to pursue national policies to do with security, to do with power projection abroad, or to do with distribution at home. And what we do find, and this takes me to the second question, a lot of

far-right parties in Europe are actually economically quite left-wing in the sense that once you make it your interest to fight the corner of the dispossessed, the marginal communities, the unemployed, the sort of stranded labor communities, you do realize

trade disruption alone won't bring back those jobs, you do end up with the kind of policies that promote more spending, more investment by the state.

So there's a kind of a fundamental paradox and I think in Europe we will see this too. I think the rise of far-right governments and parties all over Europe is going to push us into that nationalist direction. But economically speaking, I think it's, if anything, it's going to push much more traditional conservative, sorry, left-wing, middle-of-the-road economic policies on those countries.

The final point, thank you very much, about what's left for the IMF and the World Bank. I puddle about that all the time. Of course they will continue to do their magic in the countries that need credit from them. Their funding may not be as lavish as it used to be in the past. The United States, the Trump administration, has not shown any great interest in what the IMF or the World Bank do.

They may well develop a greater interest in that as they move on in their continuous never-ending political revolution. I think we should expect both institutions to simply carry on but become ever more marginal.

And that's not least because a lot of counter institutions have been created. The BRICS Bank is building up a portfolio of investments. The Asian Infrastructure Investment Bank was created deliberately by China as a counterpoint. And so in this kind of regionalized fragmented world, it's perfectly possible to imagine a scenario where some of the remnants of that liberal international order carry on.

and do good work and stabilize affairs, particularly among the Western industrialized economies, but play ever smaller role in the global South. And many developing countries now have options when it comes to getting credit internationally. And that again, somewhat blunts the tools that these two institutions have had. So that's my prediction for those two. So no working for the IMF in the world?

There's a different jobs revolution happening, but let's not get into that. So we'll take some questions from the online audience. Okay, so we've had quite a few questions come in. I'll just do three to the... Three, please. Three, if we have time. Some of them do cover roughly the same topics. The first one is from Jawah Jamil, and he says, do you see amongst the reason for economic nationalism...

that other countries and specifically China have now gained edge in the last five years on the IP development and tech front as opposed to merely being a production and manufacturing outpost. And that also links to a similar question we have received in regards to the geopolitical rivalry, not just with China but with Japan as well. And then another question that we've received, if I just go to it quickly.

So this question is from Gustavo Gorin. He's a PhD candidate in Saarland University, Germany, and also a Colombian trade counselor to the World Trade Organization in Geneva. And he said, what do you think is the role of international institutions, in particular the World Trade Organization, in these times of economic nationalism?

And then if I just do the last one. So this is a question from Anthony Valiona who is an LSE alum and he said on US unilateralism and economic nationalism, do you think this will continue or can it be reversed in 2019? Obviously if Trump does not continue. So do you think this is now the policy or can it be reversed by successors? Thank you. Robert? Thank you for those.

first point jawad's question about the relationship with china and technological developments i mean it's clear that

US nationalism is motivated by the desire to prevent China from catching up technologically and potentially eventually developing a certain edge in certain areas. I mean, AI, the developments we've seen recently in China catching up, doing AI models more cheaply, particularly the applications in military technology, that has certainly scared policymakers in Washington, D.C. and elsewhere too.

The interesting question then is whether a nationalist approach can do anything about this, and that's where the evidence is a bit hazier. If you look through the last 50 to 100 years, the one pattern we've witnessed with the global integration of economies, much greater exchange through trade, finance, investment, is that the turnover of technological innovations has sped up,

Innovation happens more quickly, but it also spreads more quickly around the world. The kind of technological gap that Britain had in the 19th century that allowed it to conquer half the world and dominate it for many decades to come, that technological gap lasted for, in many cases, for half a century or more.

Those sort of transmission mechanisms are working much faster today and I would expect them to work much faster today. So what all that economic nationalists can hope to achieve is a slowing down of that technological diffusion process. But in China's case, in many areas, we are already beyond that point because China is developing its own indigenous capability to develop and apply technology in the economic and military sphere.

That doesn't mean that you shouldn't try to slow down if you take that kind of Western military defensive view. But I would not read too much into that as a kind of a key strategic objective that can be achieved here.

The question about the WTO, so we talked about the World Bank and the IMF. My feeling is the IMF and the World Bank probably have a better future than the World Trade Organization. So if you are joining the WTO as a civil servant, then that may be a time to retool and reskill. The problem with the WTO is quite simply that as a trade organization,

system it is at its strongest when it can adjudicate disputes. The treaties, the disciplines it has put in place are great but as we see currently they are ignored at will

without any consequences. Why? Because the WTO doesn't have a functioning dispute settlement mechanism at work. Not least because Donald Trump in his first administration refused to appoint judges, panel members to the appellate body. And so it's become dysfunctional. Normatively speaking,

On their own, the GATT agreements and all the other WTO agreements don't seem to be holding back any of the trade wars that we've witnessed over the last few months. So the WTO in that sense is completely sidelined. Nobody listens to the WTO.

China has, in the last few weeks, gone to Geneva to file disputes against the United States over some of the tariffs that the United States has introduced, which is, I think, a sweet symbolic move. China is basically putting on the table notifications saying, we'd still like to work through the WTO, but of course there's no way this will have any effect. So the WTO is effectively dead in the water when it comes to the actual enforcement of rules.

As for future treaty negotiations through the WTO, none are underway, none will be attempted. Everything is now a regional and a bilateral game. And that, I think, is the biggest shift in the institutional structure that we'll witness in the coming years. And as for the question of, is there going to be a reversal?

in due course? Well, if you look at the United States, everything's possible, of course. Everyone's looking at the midterm elections and then the next presidential election. We're all praying there will be orderly elections at those points. But as we saw after the first Trump administration, it's easy to raise tariffs, really difficult to lower them again once they've been established, once you've developed a domestic constituency that benefits from these tariffs.

It's so much harder to build a political economic alliance in favor of reducing tariffs and increasing foreign competition in your country. That's why we have the GATT over successive rounds, over decades, bring down the tariffs in a coordinated fashion step by step. None of that is available to us today. So my prediction again is when it comes to trade but also investment flows,

it will be so much easier for the next president in the United States to carry on with the base level of protective measures that exist, to take the sting out of some of these policies, but to just carry on and find a new normal in that kind of environment. And that is, from a free trade and free market perspective, deeply, deeply depressing. Thank you. So we have about eight minutes. I'm going to take two questions from here and two from online.

So I'll take one at the back and... Sorry, two at the back, sorry.

And then one, sorry, no upstairs, two online, because there's no time. Yes. Thank you for the insightful lecture. I am Naotsugawa from MSC International Political Economy of LSE. Okay, thank you. And so as you said, this country focus more on their own interest and

they treat resource and technology as a strategic tool. So do you think regional cooperation can still be an effective way to respond to climate change? So any comments on climate change would be very appreciated. Thank you. Yes, you. Dina Bennett, a Year 10 student from Henrietta Barnett.

So in the end of it, when you're addressing public good and how that might be reducing on the global stage, with the UK government's recent decision to prioritise defence rather than international aid budgets, what do you think the future is of international aid? Thank you. And two for me online.

Thank you. So we've had a question from Arunima Biswas. He says he's an upcoming LSE IR student and he asked, "How does colonial history shape the extent to which a country adopts economic nationalism or do you think the influence is limited?" And then the next question we've had is from John Ooty who is a visiting professor at LSE and he's asked, "Do you think the likely reduction in economic growth will inevitably cause economic nationalism to collapse under its own weight?"

Robert? Very good questions. I know I need to keep it brief. Regional Cooperation for Climate and...

You're from Japan, of course. I remember we had similar conversations in my office some time ago. I think that's the only game in town now. The UNFCCC, the climate change framework of the UN, will carry on and will provide that necessary framework. But the US, having left the Paris Agreement and now pulling back from climate finance commitments it made in the past, means there's less money to go around. There's more distrust between the major emitters.

A lot of other countries are now looking to pull back from their national pledges. And we can only fill those gaps in climate finance and reinforce the pledges that have been made by working in a more regional basis. And in Asia, that will mean Japan and South Korea and potentially China working together. Europe is doing its bit on that front. But that is not a happy outlook for that regime. It's fragile enough.

The Paris Agreement was of course created with a Trump exit in mind, but we're going to see one hell of a test for its stability because if any other major emitter were to leave after the United States, that would probably drive the whole system apart and would really create a political blockage system. I can keep the question about defense versus aid quite brief. I think aid

as far as economic nationalists go, has had its day.

and there is very little interest to either compensate for the loss of U.S. aid or to restore British aid levels from what I can tell. The fiscal position in most countries is so dire that this is the easiest one to get rid of and for that reason, sadly, because it is a key part of any nation's soft power, but it's also an important part of our moral obligation towards the world at large.

So it's self-interest and global responsibility that come together in the aid mechanisms. For that reason, I think we ought to restore these

aid cuts, but I don't have great hopes. Nationalists thrive on the othering of those that we deal with in international relations. It's us against them, and it's relatively easy to go after them outside first. And of course, as defense budgets rise and have to rise,

There is no question that they have to rise. Aid will have to give. And finally, the question of economic growth leading to a collapse of the economic nationalist argument. I'd love to see that, but I'm not totally convinced that the failings of either left or right wing populists in government will severely dent their political prospects.

My fear is that there is a much broader sort of disappointment, disaffection with party politics that's crept in and politicians of all stripes and colors find it difficult to reengage the public in pragmatic middle-of-the-road policies.

And remember that nationalism thrives because it promises something to those that have lost out in the past, those that are marginalized, those that are not benefiting from global markets by cutting off foreign trade, by going after foreign companies, by liberating your own community and your own economy. And if that fails,

Well, the answer is either you accept defeat and revert to a more sensible economic outlook or you double down and say those foreigners are still exploiting us. And there's a kind of a radicalization logic to a lot of economic nationalism that I see at work which worries me greatly about this. So coming back from it to have a sensible debate about what policies work-- and not all nationalist policies fail as such.

They can be used and have been used by countries that catch up with other countries. That's going to be really difficult to have. Thank you very much. I have many questions, but we have to draw to a close. So thank you very much, the audience online and here, for coming and for your questions. And above all, thank you, Robert, for a great lecture and great answers to the questions. Thank you. Thank you.

Thank you for listening. You can subscribe to the LSE Events podcast on your favourite podcast app and help other listeners discover us by leaving a review. Visit lse.ac.uk forward slash events to find out what's on next. We hope you join us at another LSE Events soon.