Brexit Rings the Bell on the Age of Dis-integration
Most people want to talk about Brexit as a rogue event—like the appearance of a comet or a solar eclipse. It should be viewed, though, as an important point on a continuum that marks a transition point in a decades-long global swing toward economic and political integration.
Of course, the very groups who lobbied against Brexit are the ones who had benefited most from the integration: bankers, investors, and G-7 leaders
Since Reagan and Thatcher and the collapse of communism, we have seen nearly thirty years of increasingly free-market policies with regard to trade, regulation and taxes—this on a global scale. The effects have been to promote economic integration and the financialization of the world. The financialization is important in that it promotes debt-fueled feudalism—again, on an individual and a national level: the Greeks are an example of how debt leaves a country in servitude to the paymasters; the students (and some consumers) in the US demonstrate the servitude to debt on the individual level. Of course, the very groups who lobbied against Brexit are the ones who had benefited most from the integration: bankers, investors, and G-7 leaders.
Either way, it’s about freedom. Which is not to say it will be free.
But the classic economic tradeoff between efficiency and equality warns that free-market systems—for all their efficiency–do not distribute benefits evenly. For both individuals and countries, the wealth flowed disproportionately to those who were more prosperous to begin with. Small wonder then that populism and nationalism reared their ugly heads simultaneously in US primary campaigns and in Europe.
The creation of a referendum to leave the EU and the victory for Donald Trump (and to some extent the latent success for Sanders) were all clues that while wealth was compounding for the elite countries and the wealthiest citizens, the poorer players had been left behind—especially after China lost its appetite for raw materials and left the developing global economy all dressed up with nowhere to go. Such conditions are made-to-order for populist platforms.
So the pendulum, after thirty years of swinging toward globalization and “integration,” has paused along its upward swing. If the recent vote for Brexit and the presumptive nomination of Trump are any indication, the new trend is backward, toward “dis-integration.” And with this reversal of the pendulum, we invoke nationalism, tribalism, protectionism, and quite possibly conflict. There are parallel extremes of wealth inequality during the Gilded Age at the end of the 19th century: worker revolt and world war were the byproducts of that period of integration.
They don’t always ring the bell to tell you that one epoch has ended and that another has begun. This time, however, your ears should be ringing.