NPQ’s New Focus: Globalization 2.0

Since NPQ was founded in 1985, the world has gone through two major transitions and is now going through a third. First came the end of the Cold War, then American-led Globalization 1.0 and now Globalization 2.0, which is characterized by the interdependence of plural identities. This new era will be the editorial theme of NPQ in the coming years.

As the emerging economies from Turkey to China claim a larger share of global income, production and cultural influence we will focus on their role in shaping the next world order. We will focus on where their interests converge with the fading power of the West and where their renewed cultural foundations take them in a different direction. We will also dwell on how the participatory power of social networks affects all political systems and whether its bottom-up ideology can be integrated with the imperatives of global governance.

The central conundrum today is how institutions on a global scale that must manage the systemic links of interdependence (through provision of “global public goods” such as open trade, a monetary reserve system, security and combating climate change) can be invested with legitimacy by a restive public clamoring from the bottom up for a say in the rules that govern their lives.

If legitimacy is a function of local proximity, as Pascal Lamy has said, how do we square the challenge of making the distant G-20 the trusted mechanism of adjustment of the world power shift with the now regular eruptions of grass-roots discontent of the Occupy Wall St. movement, the Arab youth in Tahrir Square, the indignados in Madrid, the Moscow populist bloggers or the angry villagers in Wukan or Haimen in China’s southern Guondong province? Is it possible to further empower both the top and the bottom levels of governance through some combination of devolving, involving and decision-division? In the urban planet of the 21st Century, will networks or leagues of city-state-like arrangements once again become the locus of a modus vivendi that reconciles the global and the local?

While Globalization 1.0 and the rapid technological advance of the last three decades spread the wealth to emerging economies, it didn’t distribute it very fairly either there or in the advanced countries. The inequality gap has grown into a Dickensian chasm in both the United States and China. The old categories of first and third worlds have been fused into new hybrids of poor countries with rich people and rich countries with poor people.

While the stated aim of China’s leaders, set out in the 12th Five Year Plan, is to successfully negotiate the “middle class transition” that evens out inequality, the US challenge, lately taken up by President Obama, is “a middle class restoration.”

Paradoxically, as Michael Spence and Mohammed el-Erian have observed, this means yet another reversal of roles. The West must jettison the “cyclical mentality” of recent decades that assumes rich economies will bounce back from regular recessions and embrace a “structural mentality” that targets achievements in education and infrastructure as part of the same inclusive growth and employment strategy adopted by China and the other emerging economies. Instead of no-holds-barred upheaval driven by market innovation, this strategy implies calibrating change so that Schumpeter’s “destruction” does not race so far ahead of “creation” that democratic capitalism implodes.

In exploring these related themes NPQ will join efforts with the Nicolas Berggruen Institute, which is concerned with models of governance in East and West, and Eric X. Li’s Shanghai-based Chunqui Institute, which has brought many of China’s cutting-edge intellectuals under its umbrella.

Along with our weekly Global Viewpoint Network column which appears in scores of newspapers across the world from El Pais in Madrid to O Estado de Sao Paulo in Brazil to Yomiuri Shimbun in Japan, these new collaborations will enhance the unique reputation NPQ has earned over the years as one of the premier journals for cross-pollinating ideas on a global scale.

Nathan Gardels, editor