A World of Passions: How to Think About Globalization Now

Recent events have been unkind to a doctrine that defined global economics and politics during the 1990s. That doctrine, often termed “neo-liberalism” or “the Washington Consensus,” was defined by the belief that free markets and international economic integration would lead the world toward prosperity, liberal democracy, and peace. The failure of neo-liberal development policies in countries such as Indonesia and Argentina, and the new prominence of elite and popular nationalism and fundamentalism whose most vivid expression is terrorism, have together shown the insufficiency of the neo-liberal program. In Part I of this essay, I present the major features of neo-liberalism, as a program and as a view of development, and argue that it embodied a distinctly optimistic and rationalist theory of modernity. After sketching the events that led to the decline of neo-liberalism in Part II, I proceed in Part III to describe a “New Consensus” among certain forward-looking economists and policy makers, which is less tendentious in its programmatic recommendations and much more open to the role of politics and public institutions in development. In Part IV, I argue that the New Consensus needs to be augmented by a view of the economic, social, and political discontents of modernization, and propose for that purpose the tradition of the passions, a line of social thought exemplified by Adam Smith, Alexis de Tocqueville, and Edmund Burke. This tradition portrays modernity as unstable, particularly in periods of transition, with great and interwoven potential for both peaceful liberty and new forms of violence. In Part V, I survey the major, superficially contradictory features of globalization—the rise of a potentially liberal middle class and of pervasive political extremism—through this lens, arguing that they represent the competing tendencies of modernity, which the theory of the passions helps to illuminate. I conclude in Part VI with some strictures for policy that arise from this account.