An era of adverse climate, geopolitics and economy
The world is in a situation that it hasn’t been in before — globalisation, geopolitics and economics all turning negative at the same time, while the world’s physical environment becomes increasingly inhospitable.Updated: Dec 14, 2019 18:07 IST
Fewer people today live in extreme poverty than at any other point in history. People are living longer lives, are better educated and have better access to technology. By many objective measures, life on this planet has never been better. But it just doesn’t feel that way. And there is good reason for that.
The free movement of people, goods, ideas and services across borders — globalisation — has allowed for efficiencies of scale and technological advances that helped improve the lives of billions. Most people have never known a world in which globalisation wasn’t synonymous with the word “progress”. No longer.
As the last three years of geopolitical chaos and upsurge of populism have made clear, there have been plenty who have been left behind by globalisation — or at least feel like they have. That has been true of the middle and working classes of the world’s advanced industrial countries, who see the rise of a new global middle class in Asia and Latin America as coming at the cost of their own well-being. For the first time, the momentum behind globalisation is starting to sputter.
And it couldn’t be coming at a worst time. Global economic growth is now softening, and after nearly a decade of uninterrupted economic expansion following the Great Recession, the global economy looks set to head into a downturn. By itself, that’s nothing to be particularly alarmed about — economics tend to move in 7-8 year boom-and-bust cycles, rising and falling in relatively well-predicted patterns. In the last century, every time the world has headed into an economic rough patch, globalisation’s momentum has taken a hit. It typically bounces back, but there’s no guarantee it will this time. This is because this particular economic downturn is being accompanied by two new developments.
The first is today’s geopolitics. While people tend to talk about economics moving in cycles, geopolitics move in cycles, too. They just play out over much longer time spans — on average, geopolitical cycles last roughly around 70-80 years. When geopolitics are in the “boom” phase of the cycle, international institutions and governments are well-coordinated and effective in addressing global concerns, global conflicts decrease and economic cooperation increases. When geopolitics are in “bust” mode, international cooperation diminishes alongside the efficacy of institutions, and conflicts increase. We haven’t faced a geopolitical bust cycle since World War II, which helps explain why many people feel unnerved.
And then, there is climate change. It is now a genuine political issue as extreme climate events have increased, in both frequency and severity. Politicians will have both less political space and resources to devote to the issue as globalisation stalls and both economics and geopolitics head into the downswing of their respective cycles.
The world is in a situation that it hasn’t been in before — globalisation, geopolitics and economics all turning negative at the same time, while the world’s physical environment becomes increasingly inhospitable.
However, people can take solace in the fact that more than 75 years of solid globalisation has made the world wealthier and more knowledgeable, which will help its resilience in dealing with coming crises. They can also take heart in the fact that geopolitics and economics move in cycles, and somewhere down the line, they will swing upwards yet again. But that will take time. In the meanwhile, politicians, markets and voters all need to brace for a difficult few years ahead.
Ian Bremmer is the president of Eurasia Group and GZERO Media and author of Us vs. Them: The Failure of Globalism.
The views expressed are personal