The direction of history
We are heading towards a single integrated world order, sometimes called New World Order. Humanity is converging in three major ways, intellectually, economically and politically. The spread of religions and ideologies made it possible to unify different peoples under the same set of ideas. Trade and money enabled the cooperation between strangers all over the globe. And the increased cooperation between nation states is paving the way for a for a single world government.1
The world is now run by a global elite of business people, politicians, bureaucrats, engineers, journalists, scientists, opinion makers, writers and artists. No matter where they live, whether it is New York, Buenos Aires, Shanghai, Dubai or Cape Town, these people increasingly have the same interests, the same viewpoints about the world, the same culture, and increasingly live similar lifestyles. The individuals in these elites often have more in common with each other than with their fellow countrymen.1
Globalisation has completely transformed the world. People everywhere around the globe are now interconnected. They cooperate and compete on a global scale. Globalisation started more than 500 years ago when Portuguese explorers set sail for Africa to find new trade routes to the Indies. In 1492 Columbus discovered America while trying to do the same. In the centuries that followed the world gradually became more integrated because of European colonisation and trade.
World War II ravaged Europe and shifted the balance of power towards the United States. The United States began promoting free trade and democracy and made alliances against the Soviet Union and China to contain communism. To that aim several wars were fought and dictators were supported as fighting communism was prioritised over spreading democracy. The United States promoted European cooperation and the United Nations (UN) were also an American initiative. Some of the most well-known subdivisions of the UN are the World Health Organisation (WHO) and the World Bank.
There was a plan behind this. The Council on Foreign Relations (CFR) is an internationally oriented think tank of prominent figures in business, science and politics in the United States. The organisation has been a major instigator of these developments. The CFR was established in 1921 at a time when the US was isolationist and European colonial powers dominated the world. Before World War II ended the CFR in cooperation with the US government began making plans for a new world order after the war.
The view of the planners was that prosperity is the key to political and economic stability, and that protectionism had worsened the Great Depression that caused World War II. They believed that open markets would promote democracy and that the United States would benefit from prosperity in other countries. After the war European countries received loans to rebuild their infrastructure and to buy American products. By helping other countries the United States gained economic and political influence. Because of the communist threat, the United States also began to build a large military presence around the world.
The end of World War II was also the beginning of the US dominated global financial order. It was believed that stable exchange rates would promote trade so a system of fixed exchange rates was established during the monetary conference at Bretton Woods. The gold-backed US dollar became the international reserve currency. This system remained in place until 1971. From then on exchange rates were determined by market forces but the US dollar remained the world’s primary reserve currency.
The post-war world envisioned in Washington largely became a reality. It was a remarkable feat of geopolitical planning. And it was a major step in the globalisation process. Globalisation really took off in recent decades but the outcome of this process was not the result of a deliberate design by elite planners, but of several economical, political and technological developments converging. These were:
- the rise of neoliberalism around 1980
- the fall of communism around 1990
- personal computers and digital data storage
- optical fiber and Internet making it possible to connect people around the globe
- global standards for data exchange making it possible for every computers to exchange data with every other computer
- software enabling cooperation between people and businesses around the globe
In the 1970s economies in the Western world were stagnating. Business think tanks argued that poor business conditions and international competition were to blame. This marked the rise of neoliberalism. From the 1980s onwards regulations were reduced and the free movement of labour and capital were promoted. It became easier to move jobs to areas with lower labour costs. Entrepreneurs were seen as heroes and making profits became a goal in itself. It was the era of stock market capitalism and financial engineering. There was little consideration for people, communities and the environment.
The fall of communism gave further impetus to globalisation. In 1989 the Berlin Wall fell. A few years later the Soviet Union was dissolved and the European Union became enlarged. From then on it seemed that there was no alternative to capitalism.2 Countries like China, India and Russia realised that they had to compete on the global marketplace and began to transform their economies. Every country did this in its own way. For instance, India specialised in services and information technology. China became the global industrial powerhouse where everything is made.
Computers and data storage made it possible to store documents and other data like pictures and recordings digitally. In the 1980s the personal computer entered the homes of many people. Computers were also used in businesses but the impact of information technology remained limited. Exchanging data between computers was still difficult because computers often weren’t interconnected and software suppliers used different data formats.2
That all changed with the emergence of the Internet. Netscape turned out to be a crucial catalyst. It allowed people on personal computers to look at web pages anywhere around the world. Netscape turned out to be a killer application that made Internet very popular very quickly. Investors suddenly realised that Internet would change the world and that large profits were to be made. It resulted in a massive overinvestment in everything related to Internet during the Internet bubble of 2000. One of those overinvestments was in optical fiber. As a consequence the price of data transport dropped dramatically.2
Standards for data exchange emerged. Software suppliers were forced to support them and began to focus on facilitating the interaction, competition and cooperation of people around the globe, effectively enabling the world to turn into a global village where people everywhere can participate. This transformed the way people cooperate. The traditional way of organising is top down via command and control. The new way of organising is via teams of people sharing a responsibility for a task or a product, making more complex cooperations possible. China and India were able to develop and became integrated in the global economy. As businesses began to use more cheap overseas labour, workers in developed nations were faced with job insecurity and lagging wages.
The rise of China and India
In 1977 Chinese leaders realised that communist China needed to embrace capitalism. For two decades progress was slow. That changed in the 1990s but doing business in China remained problematic until 2001 when China became member of the World Trade Organisation. From then on China conformed to international law and trade practises and it became attractive to do business with China. Corporations moved their production to China and China became the industrial powerhouse of the world.
Half the world’s population lives in Asia. In China or India alone live nearly two times as many people as in the European Union and the United States combined. The same is true for Africa. If people everywhere around the globe obtain a more equal portion of wealth then the relative importance of the European Union and the United States will decline. If current trends continue, China will be the most powerful nation in the near future. The Chinese economy may be the biggest in the world already.
Chinese leaders are preparing for a New World Order under Chinese leadership. China’s policies include economic colonisation of developing countries like the United States and European countries have done previously. For instance, China grants loans to developing countries to build their infrastructure. If they fail to pay back these loans, China may take possession of assets like mines, harbours and corporations as payment. If India is going to follow suit, it may become China’s main contender. At the same time the importance of nation states is declining and they may even disappear in the future.
Businesses are closely integrated with their global supply chains. Doing business has become a global affair more than ever. Issues like trade, climate change, human rights, disease control, international crime and financial markets require international agreement and cooperation of governments. The Old World Order was based on the sovereignty of nation states, which means that at least in theory, there was no higher authority than the nation state. All nation states were equally sovereign, at least in theory, and their power was restricted only by the treaties they signed.
Nation states are increasingly under pressure to conform to global standards as actions of one nation affect other nations as well. The global elite influences the decisions on these issues but they can’t completely ignore ordinary citizens. The elite believes it acts for the benefit of mankind and that we need more international cooperation or even a global government. This is reflected, for instance, in the words of the British politician Denis Healey, who had been involved in Bilderberg Conferences in which members of the elite gathered in secrecy. He told the Guardian:
To say we were striving for a one-world government is exaggerated, but not wholly unfair. Those of us in Bilderberg felt we couldn’t go on forever fighting one another for nothing and killing people and rendering millions homeless. So we felt that a single community throughout the world would be a good thing.3
The elite is first and foremost a social network. Elite members have friends and they have friends who have friends too. Meetings like Bilderberg are just the tip of the iceberg. Still these meetings can influence political agendas. For instance the European Union has been discussed at Bilderberg and it may well be that these meetings helped to make the elite agree on more European cooperation and integration. Europe had just been ravaged by two world wars so it probably seemed a good plan. And it wouldn’t have succeeded if most Europeans didn’t have the same opinion.
Neo-liberalism or neo-feudalism?
Many people in China and India have seen their living standards improve. In fact, globalisation may have been the best development aid ever. Nevertheless, the greatest winners are wealthy oligarchs all around the world. A 2017 report from Oxfam points out that the world’s eight wealthiest people own as much as the poorest 50%.4 There is no global government or binding international treaties so nation states end up competing to please large corporations and billionaires. In a feudal societies ordinary people were mere serfs of the elites. Many people today find themselves in a similar situation, at least to some extent.
In the 1970s the situation in Western Europe and the United States was different. Most people were middle class. Since then a growing divide between the rich and the poor emerged. This coincided with the rise of neo-liberalism in the 1970s. At the time the ruling class was in trouble, the economy was stagnating, unions had a lot of power, and the cost of welfare became a burden. Since then more was left to the markets, the power of labour was curtailed and welfare was reduced. Wealth and income inequality started to increase. Many jobs moved to low wage countries. There indeed was a plan behind the rise of neo-liberalism.
A widespread conspiracy theory claims that the elite has a secret plan to create a New World Order in which ordinary humans will be mere serfs. Rather than seeing globalisation and the emerging oligarchy as a result of social, political and economic developments, the theory claims that it was all deliberately planned by the elites. Indeed, the post-war world order was more or less designed by the United States government with the help of think tanks like the CFR, but it was also a historical accident that these plans materialised the way they did. World War II more or less handed over world domination to the United States and skilful planners have used this to pursue their objectives.
Distrust of government is one of the pillars of a culture centred around individual liberty and non-interference that many people in the United States cherish. The fact that the United States has been used by its business and political elites to create a post-war global empire therefore meets resistance. Institutions of the empire like the Federal Reserve and also the United Nations are seen as tools of the elites. As Healey’s comments on the Bilderberg meetings point out, the elite believed in international cooperation. The idea that the world is interconnected and that one’s actions affect people elsewhere on the globe is at odds with ideas of individual liberty and non-interference.
The mainstream media have always been subject to a degree of self-censorship, mostly by omitting or under-reporting relevant news stories. Against this background there is a market for independent writers and to come up with disclosures to keep readers entertained. Truth isn’t always of the essence. It is about attention and advertisement income. That feeds extreme beliefs like the idea that the world is run by a secret network of paedophiles from a basement of a New York pizza restaurant. Social media have amplified this process. People are hooked on the internet waiting for new disclosures.
The situation in the United States has some historic parallels with countries just before a revolution. An oligarchy controls the state. The social order is contested from the left as well as the right while people at the political centre realise that the system is failing. In Europe there is a similar development but the situation has not yet advanced to the same point, perhaps because historically Europeans have more trust in government while corruption in the political system is less endemic and most European political systems allow for multiple political parties so that diverging views can more easily get a voice in parliament.
Politicians come and go but many officials remain within the governmental institutions for a longer period of time. Often they are specialised technocrats that have the best knowledge of the field they are working in. Most of them believe to work interest of the public but they can obstruct elected officials. An unresponsive or obstructing bureaucracy is an issue with a long history. Chinese emperors already faced it 2,000 years ago.5 One can as easily say that elected officials can obstruct the work of their bureaucracy. It is a matter of perspective and it may depend on who is right.
Interest groups have captured the government to profiteer at the expense of the taxpayers. They are the lobbyists and think tanks who represent the interests of businesses that live off government contracts or benefit from favourable legislation, and in the United States groups that represent the post-war global order, for instance the Military Industrial Complex. These people work covertly via social networks to influence politicians and other officials. This isn’t a new phenomenon either.5
Politicians in the United States fund their campaigns with donations from corporations, interest groups and wealthy individuals so they represent their donors rather than their electorate. As a possible consequence the likelihood of a law passing doesn’t depend at all on voter preferences.6 This fuels the political culture of government distrust and it makes the debate focus on the size and powers of government rather than its quality. Checks and balances have been put in place to limit executive power, but they undermine the effectiveness of government and allow elites to influence the decision making process.
In the decades after World War II the secret services of the United States have toppled democratically elected governments and supported dictators all over the world while claiming to promote human rights, freedom and democracy. Geopolitics is a cynical game and a struggle for survival that can conflict with stated morals and principles. The fight against communism has determined US politics during the second half of the twentieth century. And it is impossible to know what would have happened if the United States hadn’t taken up a global leadership role in order to contain and bring down communism.
Improving the political economy
A social order is the result of the interplay of social groups in a society. In a capitalist economy wealth and income inequality tend to increase. If governments do not correct this issue, the economy may suffer and social tensions may rise. During the neo-liberal era the government has been partially privatised. Schemes to profiteer from government proliferated accordingly. Rather than correcting wealth and income inequality, government policies came to enhance them. As the wealthy succeeded in reducing the taxes they pay, governments went into debt. This is a recurring pattern in history.
The recipe is well-known. It is standing up against the oligarchy and creating a clearer distinction between the private and the public realm. People must understand that collective action is the only way to realise certain goals in society. It is possible to have good quality government. Countries like Denmark and Switzerland have it. Neo-liberalism sees government as a problem and society as non-existent. This view is not favourable to collective action and it helps the elite to remain in power and to exploit us with impunity.
As long as societies are divided politically this is unlikely to be resolved. A resolution requires people setting aside their political differences and rallying behind common causes with regard to systemic improvements in government and society. This might attract a broad coalition in the political centre. A good government can either take up many tasks like in Denmark or be more limited in scope like in Switzerland. It is not about the size of government. It is more important that a government does the things it does right.
1. Sapiens: A Brief History of Humankind. Yuval Noah Harari (2014). Harvil Secker.
2. The World Is Flat 3.0. Thomas Friedman (2007). Farrar, Straus and Giroux.
3. Who pulls the strings? (part 3). The Guardian (2001).
4. Just 8 men own same wealth as half the world. Oxfam (2017).
5. Testing Theories of American Politics:Elites, Interest Groups, and Average Citizens. Martin Gilens and Benjamin I. Page (2014).
6. The Origins of Political Order: From prehuman times to the French Revolution. Francis Fukuyama (2011). Profile Books.