The fragmentation of power

The European |

The end of the nation-state as we know it: Parag Khanna discusses the path towards global connectivity and why we have to shift from Western history to global history.

Interview with Martin Eiermann

The European: Mr. Khanna, especially in Europe, we’re witnessing a resurgence of regionalist or nationalist thinking that seems to cast doubt upon the aspirations of the last several decades. Is the post-crisis frustration in Europe foreshadowing a larger turn away from the project of globalization?

Parag Khanna: No conversation about the future of Europe should be seen as indicative of the future of globalization. That’s the worst kind of Eurocentrism. Globalization has long eclipsed its North American and European anchors – we no longer live in the world of 19th century colonialism. There are very important Western foundations to globalization, from international financial institutions that grew out of postwar attempts at regulating economies at the international level to Western multinational corporations that began to pursue globalization in the 1960s and 1970s. We can give adequate recognition to the role that the West has played in integrating the world economy, but it would be crudely anachronistic to see European trends – whether they are characterized by fragmentation or unification – as reflective of global trends. From a macro-historical perspective, you have to shift from Western history to global history. That’s the initial point of departure for any assessment of globalization.

The European: Last year, the “Guardian” published an article series on global borders that noted the construction of more than 6000 miles of border fences during the last decade, from Morocco to Korea. Isn’t that a pretty clear sign of the global affirmation of demarcation and fortification?

Khanna: Let me make a philosophical point first: There’s a notion that more independence movements and struggles for autonomy are somehow the antithesis of globalization – what Samuel Huntington would have called post-national globalism, or what we might describe as a Davos-inspired conception of globalization. I believe that the reality is very different.

The European: In what way? Khanna: First, most of those borders are physical rather than economic: Many important forces aren’t constrained by them. Second, secessionist movements are part of the natural evolutionary path towards a connected global civilization. The reason is this: When regions or cities seek an alternative future, it speaks to their perceived need and capacity to escape from the imposed prison of nationhood. Third, those sentiments aren’t a new phenomenon but were present in Great Britain or Spain throughout history. In Italy, too: Right in the middle of the Crimean crisis, the city of Venice held an unofficial referendum to secede from Italy. Finally, it’s important to point out that for every mile of border fence that we put up in the world, we put up multiple miles of cross-border infrastructure: railways, pipelines, cables, bridges, tunnels, et cetera.

“The world is spending more money on infrastructure than on military”

The European: In other words: As long as our conception of the world is focused on political borders, we’re bound to under-estimate the extent of cross-border dynamics?

Khanna: The world is now spending more GDP money on infrastructure than on military spending. That’s a very rare phenomenon, historically speaking, and it has only been true for the last three or four years. Today, about 2.4 percent of global GDP – equal to around 1.75 trillion US dollars – are spent on the military. Estimates for investments in infrastructure range from 2.5 trillion to 4 trillion US dollars. We’re spending a lot of money to build cities or to fix old infrastructure, and some of that is cross-border infrastructure. It enables connectivity, which leads to a growing capacity of sub-state entities to shape their own relations with the world. Their relations no longer have to be filtered through the nation-state. The notion that this amounts to nothing but tribalism and nationalist retrenchment is a complete misreading of what’s going on.

The European: I want to go back to your point about connectivity: The big shifts in international exchange are still negotiated at the level of the nation-state: Free-trade agreements between governments, sanctions imposed by a country or by the United Nations against another country.

Khanna: The more small entities you have in the world, the less autarky any single entity can have. There are many ways to factually demonstrate this, but here’s one: The number of countries in the world that are food importers has steadily increased, and the amount of imported food is actually growing in many instances. Let’s take China: Five years ago, the country imported zero beef. In 2013, it imported 500,000 tons. When I wake up and read that Vladimir Putin is going to ban food imports from a number of countries, it represents merely a lone data point in the opposite direction. It won’t last long, and it is certainly not indicative of a larger trend. We are building a global and connected world by way of having more devolution and autonomy.

The European: You’re confronting two debates: First, is the age of nation-states really over? Second, is the paradigmatic model of globalization predicated on supra-national entities or sub-national networks? Khanna: These debates aren’t mutually exclusive. We are, in fact, creating more nation-states by breaking up large multiethnic states: Kosovo, Kurdistan, South Sudan, East Timor, et cetera. The number of countries in the world has increased dramatically since World War II, so the Wilsonian project continues to this day. At the same time, we see driving forces that cannot be mapped onto the nation-state: technological change, communication technologies, infrastructural underpinnings of global connectivity. The nation-state doesn’t have to disappear in order for the sub-state to transcend it. Those are two different trends that are happening at the same time, and while they must not lead to the end of the nation-state, they certainly lead to a more complex and layered system.

The European: Where political scientists might see a multipolar world, you see a world that is primarily characterized by the multiplicity of networked organizational forms.

Khanna: There’s a whole body of work around ideas like multi-actor systems, heteropolarity, world society, et cetera. There’s a whole range of scientific and pop culture terms that speaks to the impact of this kind of thinking.

The European: One of the criticisms of economic globalization hinges on the radical diffusion of power: If power exists in networked exchanges instead of institutionalized forms, how can it be contested? And it seems to me that your argument opens up a possible response: Power might be diffused through a network, but it still flows through very concrete nodes, e.g. through cities.

Khanna: Entropy is absolutely endogenous to my argument; it’s the bedrock. The fragmentation of power is irreversible and inevitable. We can already see it on the level of political geography: The number of states has increased, and the fragmentation of states shows no signs of slowing down. That’s one symptom of the larger trend towards devolution. Another symptom is the transfer of power to non-state actors, from large multinational corporations to NGOs and terrorist organizations.

The European: You have invoked the Middle Ages as a historical period that foreshadowed the paradigms of globalization. How?

Khanna: The analogy operates on several levels. The first goes back to the idea of a global history: When you are looking for a period with powerful non-Western actors, you have to go back to before the Portuguese empire. You have to look at the Song dynasty in China, for example, or at the Caliphates or at the Holy Roman Empire, which was in many ways the weakest actor of the three. The second dimension has to do with connectivity and the commercial revolution in the 12th and 13th centuries. Up until the advent of the plague, cross-border trade was becoming increasingly habituated across Eurasia. Obviously there had been trade relations between different civilizations before, but they had never been as endemic. There’s a Eurocentric view that sees the first wave of globalization occurring in the late 19th century when European nations traded within their respective empires; the view that “the sun never set on the British empire”. But that’s an incorrect view: The British empire wasn’t really a global phenomenon but a vertically integrated structure without distributions of power. Global diversity in the 1900s was actually much lower than 700 years prior. The third dimension of the analogy has to do with the multi-actor world of the Middle Ages. It was a pre-Westphalian world without nation-states in which power was concentrated in cities, merchant guilds, the papacy, mercenary bands and many other kinds of actors. They each had a kind of diplomatic autonomy. Today, we’re witnessing a similar diversity of actors.

The European: If we look for a constellation of driving forces, which ones stand out? Military engagement? The quest for new markets? Technological change?

Khanna: We are seeing the effects of confluence of trends with separate drivers that are all coming together on a global level. If I had to pinpoint a few things, I would list global economic integration, communications technologies, and infrastructure. And we should not underestimate the role of big data: There’s a strong movement in the US that originally intended to leverage open data to make Washington more efficient. But its most significant impact lies elsewhere. The centralization of governance has always been highly dependent on control over information. Big data and transparency make information available to everyone in real time. Washington no longer holds that information monopoly. So while big data hasn’t necessarily improved efficiency in Washington, it has empowered cities like Sacramento and New York. They can look at the data and say, “how can we keep more of our tax revenue locally instead of sending it to Washington?”

“People want to spend money on local projects first”

The European: You hear very similar arguments in Catalonia: Advocates of autonomy criticize transfer payments from their economically strong region to poorer rural regions of Spain.

Khanna: In the Venetian declaration of secession from Italy, they explicitly said: “We pay eight euros to Rome for every five euros we receive. Being part of Italy is a bad deal.” For centuries, it was impossible to get such an accurate reading of financial data. In Scotland, you see demands for a certain share of oil revenues from the North Sea in exchange for continued allegiance to Great Britain. You can hear and see similar arguments in Western Canada or Western Australia. These are all liberal Western democracies that appear unified – but beneath the surface, they are anything but! People want to spend money on local projects first, and then give only the remaining pennies to the central government. If you’re not paying attention to those tensions, you are merely living in a theoretical la-la-land where you see the nation-state as the only anchor of identity.

The European: If you are worried about global inequality, shouldn’t this trend be highly worrisome? Arguably, one of the most powerful aspects of the nation-state is the solidaristic appeal to a national or ethnic community that isn’t merely bound together in contractual economic fashion. If new communities are organized around economic potency alone, the gap between rich and poor cities and regions is likely to grow quite dramatically.

Khanna: Exactly, it’s a cost-benefit approach to life and to geo-politics. It spells disaster for inefficient states – but I think that’s a good thing. Before it becomes a threat, it becomes a competitive dynamic that is going to spur improvements in the quality of governance. Could it lead to secessions and civil war? Yes. But it’s first and foremost a dynamic that prevents complacent, monopolistic, rent-seeking behavior.

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