The Long Century

Bradford DeLong, professor of economics at Berkeley and former Deputy Assistant Secretary of the Treasury for Economic Policy, has provided a brilliant geoeconomic overview in Slouching Towards Utopia. He aims to instill the most important lessons of the “long twentieth century” (1870–2010), while offering an understanding of the forces that still shape the world today.___STEADY_PAYWALL___

The story begins when economic growth started to outpace population growth in the industrialized countries of Europe and the United States. This growth gradually led the economy to become a prime driver of societal dynamics, given the free market's role in both offering a higher quality of life and, at times, degrading the dignity and rights of the working classes. DeLong seamlessly weaves together these developments and illustrates how the free market and economy impacted the industrial, economic, military, social, and political realms.

It becomes clear that the long century was one of societal progress driven by economic growth by way of invention, better bureaucratic and corporate organization, and international collaboration, interspersed with occasions where politics broke down previous growth. At a time when unipolarity is giving way to multipolarity, DeLong explores the question of whether societies would let (geo)politics escalate to the point where conflict undermines peace, prosperity, and their long-term interests.

DeLong reminds us that between 1870 and 1914, while the Global North experienced unprecedented progress in prosperity and health, nationalism still took hold of the aristocrat, industrialist, worker, and farmer alike. In war they saw an opportunity for political unity, national mobilization, and economic advantages. By the time two world wars had left tens of millions dead and—along with the Great Depression—had obliterated decades of progress and wealth, the world learned there were no advantages. The weary were eager for stability. Three lessons of DeLong’s on this front stand out.

The first lesson regards the need for a global hegemon. DeLong illustrates how after the decline of the British Empire, international trade fell into disarray and protectionism increased. A trend that got only worse until the United States dropped its isolationist tendencies and picked up the mantle of authority following WWII. He notes that game theory matters here: “An acknowledged hegemon makes everyone understand how to coordinate and fall into line.” Otherwise, the dynamics of politics produce strongly protectionist and nationalist reactions—as opposed to open and global ones.

One might expect countries to work together as they see global crises increasing and public goods diminishing, but, as he reminds us, that’s not how politics work. As you read DeLong’s book, you feel a heightened sense of urgency about creating a functioning international resolution mechanism, whether it’s at the behest of the United States, the UN, or the World Trade Organization. Regardless, DeLong makes clear that a multilateral free-for-all never ends well.

This segues into his second key point: The division of labor in a globalized world is much more fragile than many seem to realize. In 1919 John Maynard Keynes was one of a few clear-eyed enough to recognize that protectionism between countries and “keeping Germany poor” would disturb the local division of labor. He forecasted a weakened European recovery and German resentment, which, as we now know, turned out to be accurate.

It is easy to see the parallels to today as protectionism is resurfacing around the world and the United States endeavors to maintain an economic edge over other nations. We must be mindful of how easy it is for opportunistic politicians to channel the resulting frustrations of voters who will be facing inflation, unemployment, and other disruptions. Indeed, looking back, German fascism has plenty of kissing cousins.

This connects to the third lesson DeLong offers: the historical recurrence of fascism. At its core, fascist views tend to see parliamentary democracy as a system of corrupt bargaining between different interests, and it views the free market economy as a function designed to make global elites richer and suppress "the people," while granting favoritism to religious and ethnic minorities. Fascism promises to subsume self-interested politicians and businessmen into an obedient political order under a strong leader, yet that rarely turns out to be the case. DeLong assigns a primary role to these frustrations in his analysis of why so many people have turned against liberal and social democracy, even though it delivered thirty years of unrivaled wealth between 1940 and 1970.

The Demise of Liberal and Social Democracy?

DeLong goes on to analyze why growing inequality since 1970 has not elicited similarly strong political reactions, given that inequality often feels more degrading than simply having less wealth. As the earnings of the top 1 percent have grown, the rich having translated this wealth into increased policy influence through lobbying and patronage networks. Despite growing unhappiness and awareness of economic inequality, these sentiments have not resulted in the election of candidates that might mitigate or reverse it. DeLong contends that an important reason for this is that as economic growth had stopped for many segments of society, the Right has focused on making economic issues less salient by increasing attention on social divisions.

What’s more, the rich have better access to platforms to amplify their perspective and promote the message that a rising tide lifts all boats. Since the Reagan Administration, restrictions on the free market have been likened to the tyrannical impositions of the Soviet Union. I would add that DeLong might underestimate the weight of Mussolini’s observation that class affinity is a relatively weak chain in bringing people together–a view that led Mussolini to favor fascism over socialism. Perhaps it was only ever the demographic of blue-collar laborers, thousands of people working side-by-side in similar jobs daily, that held the foundation of liberal and social democracy together.

At any rate, by the end of the long century, trust in governments had plummeted. Liberal and social democracy no longer seem able to command support from durable majorities. The innovation economy diverted a huge amount of the world’s capital from productivity-improving technologies towards capturing attention in ways that preyed on psychological weaknesses and biases. China’s techno-capitalism is giving rise to the Chinese Communist Party’s surveillance state, and Big Tech algorithms are degrading individual agency in ways that we are still becoming aware of.  What’s more, DeLong feels that neither the Left nor Right has offered up a coherent scheme for progress.

Throughout his book, DeLong grapples with whether the intentional actions of powerful individuals or the unintentional historical contingencies have played a larger role in shaping events and society’s economic and social developments. Leaving room for both, DeLong’s own belief is that we would be better off today if certain key factors and people behaved in slightly different ways–demonstrating the power of individual and societal agency to shape our trajectory. For those who want to learn from history, his book would be a good place to start.

Mehrjar Jaafari is a university student in Ghent and member of D66, a Dutch social and liberal political party.

Image: A USSR stamp from 1966 commemorating Vladimir Lenin. (Flickr: Mark Morgan)