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2. The Model from 1945 to 1995
- ISEAS–Yusof Ishak Institute
- Chapter
- Additional Information
3 The Model from 1945 to 1995 2 The Model from 1945 to 1995 On the meaning of the terms globalization or economic internationalization, most people are like the person in the well-known elephant joke who says that he cannot describe an elephant but can recognize one when he sees it! Such a posture is not enough. It gives no clue as to what we are talking about. We need to take a close and hard look at the mechanics and the details of globalization. The following checklist is critical for us to escape the straitjacket of seeing economics as the only, or at least the only important, defining characteristic of globalization/ internationalization. Do we think as a nation (inward-looking) or do we think as citizens in a broader world (outward-looking)? 4 J. Oerstroem Moeller From where do we get our information and inspiration? National media or international ones? What goods and services do we purchase? Does the label “Made in country X” matter? Where do we work? Where do we study? At home or abroad? What about our leisure? Travel, entertainment, holidays? The mindset is the key. Do we perceive the world as composed of many entities — nations — separated by borders on the map? If so we are talking about nationalism? Or do we perceive the world as one large stage? This second way of perceiving the world is what I have defined as internationalism. History tells us that internationalism leads not only to higher living standards but also to a more peaceful world. Nationalism is not good for economics and increases the risk of major wars as nation-states play the dangerous game of “beggar thy neighbour”. National pride triggers off rivalries leading to war. Examples of this can be found in European history prior to the First World War and between the two World Wars. The post-1945 international model operated on three anchors: the welfare state, collective defence, and economic growth. [44.212.26.248] Project MUSE (2024-03-28 18:11 GMT) 5 The Model from 1945 to 1995 National welfare systems made the societies worthwhile to live in for their citizens and worthwhile for them to defend. The threat from the Soviet Empire was both an ideological and a conventional nationalistic one. It was parried by collective defence. Economic internationalization emerged to finance both the welfare state and collective defence through sustained high growth. These three main elements supported each other. The model was consistent. It worked. These three main pillars actually interacted in a positive way. The international division of labour increased economic growth. Financial resources became available to shore up the lavish welfare systems. The societies looked even more worthwhile to defend. How does the system look now? The common enemy has disappeared after the end of the Cold War. A new enemy has emerged in the name of international terrorism — albeit dangerous and threatening, it is not as terrifying as the Soviet Union was perceived to be. International division of labour is producing less impressive growth rates. The flows to finance the welfare societies are not as strong and deep as they used to be. Welfare societies have been forced to trim their welfare services. Privatization is 6 J. Oerstroem Moeller groping its way into the system, undermining one of the most fundamental principles of genuine welfare societies: everyone is equal. Not only do the three main elements no longer interact positively, they actually start to act against each other. In the pre-global era, the nation-state system was the universally adopted, almost sacrosanct, political infrastructure which was supplemented by a somewhat fragile international framework. Sovereignty permitted the nation-state to pick and choose domestic policies according to its preferences. Domestic legislation prevailed without fear of international repercussions. Pursuance of national interests was the agreed yardstick. National ambitions — despite embryonic globalization and despite ideology — were still the dominating issue, explaining and guiding the attitude of the players. This is no longer the case. Transnational forces, multinational enterprises, and supranational institutions have entered the game. Their presence cannot be reconciled with a fundamentally national-oriented model. Almost all the problems and challenges are international in character and few, if any, can be solved by neglecting this imperative. ...