The following is the English version of an article originally appeared online in Mandiner. Date of publishing: 16.02.2023.
The sequel to Tom Cruise’s new Top Gun landed in movie theatres to widespread acclaim earlier this year. After two years of turmoil, Maverick was an unabashed celebration of military daring and American showmanship. Yet as moviegoers returned home, the state of the world no longer reflects the assumptions of the two Top Gun movies, 1986 and 2022.
The world is rapidly shifting away from the global liberal order led by the United States, and Maverick was nostalgia for a long-gone era where a few targeted military strikes could keep order. The new multipolar world is much less simple.
Hungary will have to tap the deep wells of its practical wisdom in order to navigate successfully.
Since the beginning of the war in late February 2022, the world has begun a series of rapid shifts. While the United States has gotten locally stronger—endangering the European economy under a sanctions policy that hurts the United States less (for now)—it has become globally weaker, driving Russia and China closer together and hastening the rise of the ‘BRICS+’ alliance. Renegade nations do not simply bend or collapse in response to US air superiority as they once did. The era Maverick celebrates no longer exists.
From the vantage point of the 1990s, it certainly seemed as though no serious threat stood in the way of global liberalism’s ascendancy.
But first, what do we mean by liberalism and liberal democracy in this context? Thinkers of the time concluded, following the fall of the Soviet Union, that society was pointing further and further in the direction of increased liberation, which could be secured through the democratic process. Borders would slowly fade in significance, cultural differences would become secondary, English would be spoken everywhere. People would express their freedom through consumer brands, alternative lifestyles would flourish and we would steadily become ‘one world.’
The geopolitical events of the 1990s seemed to confirm this. Operation Desert Storm at the beginning of 1991 demonstrated that American air power could bring Iraq to its knees within a matter of weeks—with barely any blood spilled on the American side. The NATO bombing of Yugoslavia in 1999 followed a similar theory: the United States was sufficiently powerful to punish offending parties with a few key strikes. After the fall of the Soviet Union, American expertise in law and financial services would combine with American consumer brands to Westernise the world. China, after the liberal economic reforms of Deng Xiaoping, would have to take steps in the direction of democracy.
Movements toward free trade in the 1990s reinforced the ideas that borders and nations would matter less and less. The Washington Consensus, formulated in 1989, gave the policy blueprint to international institutions to drive more and more changes toward openness. In Europe, the Maastricht Treaty launched the European single market in 1992–93, while the following year saw the North American Free Trade Agreement create a more unified trading zone between Mexico, the United States and Canada. With the advent of the Schengen Agreement in 1995 and the euro in 1999, Europe looked set to model a vision of global humanity in which the old world of nations and borders would be definitively put to rest.
After the fog of the Cold War cleared, American writers saw a glorious future of consumer capitalism bringing the world closer rather than sowing alienation. In his 1999 book The Lexus and the Olive Tree, Thomas L. Friedman unironically proposed what he called the Golden Arches Theory of Conflict Prevention:
‘No two countries that both had McDonald’s had fought a war against each other since each got its McDonald’s.’
With the advent of the internet and the World Wide Web, a unified global marketplace seemed even more within reach. The companies of the era reflected this in their slogans: when eBay was launched in 1995, its slogan was ‘Connecting Buyers and Sellers Globally.’
On 11 September 2001, it became clear that the globalisation of the 1990s had also engendered enemies. The peace of the 1990s was finally interrupted, and new enemies had the skill to strike back. But in response to 9/11, the United States did not give up on the liberal order. Rather, it doubled down. Islamic terrorists were merely a temporary obstacle on the path to further global liberalisation, America claimed.
The people of Iraq and Afghanistan, it was said, would welcome American troops as liberators since they, in their hearts, yearned for the very same freedoms that we had. The quick initial routs of Afghan and Iraqi forces reinforced the impression that American military power could tamp down global unrest. Ten years after 9/11, it was clear that America had only become bogged down in Iraq and Afghanistan without an obvious path to victory or easy way to withdraw.
The real challenge to the theory of global liberalisation came with the two major events of 2016, however: Brexit and the election of President Donald Trump.
Before Brexit, European elites viewed the European project as an emblem of the direction of humanity toward closer integration into one liberal imperium.
It was simply not possible, they said, for that process to be slowed down or stopped. Indeed, after Brexit European elites spent several years trying to forestall the inevitable. With the election of Trump, the national populist challenge to global liberalism had taken the US presidency itself. There, too, the liberal empire managed to consolidate itself and remove, at least for a while, the threat they faced in Trump.
But everything has now changed on a larger scale. Following Russia’s invasion of Ukraine, the West has not reacted with confidence in the power of global liberalism to keep friends and convert its enemies. The consequences of the West’s actions are instead hastening the rise of a multipolar world. The reason for this goes back to the West’s decision to react to the Russian invasion of Ukraine by using measures similar to those it had attempted against smaller powers: imposing sanctions on Russian leaders and economy, because (they said) the Russian economy was ‘weak’ and ‘small’ by comparison with the West.
At its root, however, the West chose to react to Russia by cutting Russia out of the global system.
This shift, more than any other, marked the decisive end of the trend of globalisation.
In the days after the Russian invasion, Jeffrey Sonnenfeld, a professor at the Yale School of Management, drew up a list of all American companies doing business in Russia, with the purpose of naming and shaming them in order to pressure them to withdraw. With this, it became clear that global capitalists no longer believed in the power of commerce to promote liberalisation.
The sacred obligation of liberal capitalism became not to spread, but to withdraw. After a few months, McDonald’s itself declared the end of its thirty-two years of operations in Russia. What an ironic moment! If the West still believed that commerce would lead to liberalisation, now would surely be the time to redouble our commitment to spreading McDonald’s in Russia!
The end of globalisation was confirmed by none other than Larry Fink, the CEO of BlackRock, the world’s largest asset manager. ‘The Russian invasion of Ukraine,’ he wrote in an investment letter this spring, ‘has put an end to the globalisation we have experienced over the last three decades.’ Instead of Western brands conquering the world, there would now be a fracturing.
Most important, by attempting to exclude Russia from the global financial system, the United States ended up undermining trust in itself. After all, trust is the basis of the U.S. dollar’s reserve role in the global financial system. If countries that fall afoul of American foreign policy risk having their foreign currency reserves frozen—as Russia experienced—
many other countries will think twice about exposing their wealth to American management.
The same goes for the settling of key commodity transactions outside the US dollar.
The most striking feature of the new ‘multipolar’ world is that Western liberals no longer believe in the power of commerce to turn the rest of the world toward liberal democracy. Given that, we might ask: is it not more important for nations to take a practical approach to the emerging circumstances, rather than fall in line with our increasingly brittle liberal empire? For now, the answer is that the United States has become more influential over European policy even while the signs suggest American economic influence is becoming weaker in Latin America, Africa and Asia.
But the features of our emergent multipolar order are clear. There will be increased use of currencies other than the U.S. dollar to settle transactions. The West, led by the United States, will continue its efforts to sanction offending countries and pursue conflict through intermediaries. Meanwhile, the West’s commitment to ideological left-liberalism will begin to undermine its own diplomacy. China, by contrast, is becoming a regional hegemon and powerful international influence through its economic power. Latin America, Africa, south and southeast Asia will tilt more toward the Sinosphere. Finally, the cold winter and any energy crises will bring out tensions within the Western alliance system.
The emergent multipolar order will be challenging for Hungary. As with any country that sits near a zone of potential conflict between major powers, Hungary opposes the formation of geopolitical blocs that could lead to casualties in the region.
Yet Hungary is also well positioned on a number of practical grounds. First, its strategic sense is deeply rooted within the region that is surrounded and protected by the Carpathian Mountains. Avoiding geopolitical blocs also requires having pragmatic relations with neighbors, particularly in the field of trade.
Navigating the coming years will require some specific changes, however. Unlike the 1990s when Western ideas seemed to bring development and success, there now must be increased skepticism about ideas and practices imported from the West, which has undergone a kind of cultural revolution.
The fracturing of unipolar global liberalism does not mean that nations will return to autarky. Rather, it means that classic assumptions about human nature, national interest and political pragmatism will become more useful in the coming years, as liberal assumptions fail and become counterproductive.
In preparing for the tumultuous years to come, a strong emphasis on developing and training native talent, and raising up a generation of leaders capable of serving their country well, will put Hungary in the best position for navigating this unexpected new world.
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