The case for globalisation optimism

just now from a bad attack of economic pessimism,” wrote John Maynard Keynes in 1930, in the midst of a disintegrating global economy. He went on to describe the much better future the world could expect if it ever got its act together. Things are not so bleak today, but it is nevertheless hard to feel cheerful about globalisation’s prospects. America and China, which together account for nearly a quarter of world trade, are on ever-icier terms. Rules which fostered an era of rapid globalisation are being flouted into irrelevance. Perhaps most distressing is the sense that this film has played before. The 19th century saw its own period of breakneck globalisation. In the end, however, economic nationalism and great-power conflict destroyed the global trading system, and much else besides. A spiral towards catastrophe sometimes seems only a few stray balloons away.The world has experience with cold war, but not between countries as economically intertwined as America and China. In a suspicious atmosphere, accidents happen. The habit of protecting and subsidising domestic firms—as both countries are now doing on a gargantuan scale—may prove difficult to break. All this means globalisation’s immediate prospects appear bleak. But looking on the bright side, as Keynes did, is a helpful reminder of the ways in which events often end up going better than expected. Where globalisation is concerned, demography, technological progress and the example of history itself could push the world in the direction of more, rather than less, integration. Globalisation’s prospects are brighter than most now appreciate.