Brink Lindsey’s Against the Dead Hand: The Uncertain Struggle for Global Capitalism (John Wiley & Sons, 2001) is the most intellectually stimulating of all the recent books on globalization. Lindsey articulates a fervent defense of open markets at the same time he poses serious concerns about their future. Director of the libertarian Cato Institute’s Center for Trade Policy Studies, a Washington think tank, Lindsey worries that too many people assume that the continuation of globalization is inevitable. He instead believes that globalization is in its infancy and will be threatened by a series of childhood maladies that could include national and regional financial crises, protectionist backlashes, and antiglobalization political movements.
Lindsey recasts the history of trade and commerce over the past 150 years in a highly original way that will intrigue anyone involved in international business. His thesis is that the first great wave of globalization, which lasted until World War I, arose both because of the strength of the intellectual argument in its favor and because of the technological innovations of the Industrial Revolution. But as early as the 1880s, he finds the beginnings of what he calls “the Industrial Counterrevolution.” Starting with the writings of Karl Marx and the rise of German state socialism under Otto von Bismarck, the political opposition to free trade and globalization mounted in the late 19th and early 20th centuries, taking the form of protectionism, imperialism, and militarism.
It all culminated in World War I, which, Lindsey writes, “provided both the means and motive for the collectivist spasm that followed.” In the social and economic chaos that gripped the world from the start of World War I to the end of World War II, the earlier progress toward globalization, writes Lindsey, “was interrupted, its achievements demolished.”
In his view, the creation of the modern multilateral financial institutions of the international economy in the postwar years, along with the championing of free trade by the United States, slowly recreated the conditions that enable globalization, but it was a long road back. Lindsey notes that world merchandise trade as a percentage of world output has been estimated at 11.9 percent in 1913 — a level of export performance that wasn’t matched again until the 1970s. And still, the ideas and movements that produced the Industrial Counterrevolution live on, he says, to distort and frustrate the world’s economic development. This is the “dead hand” of his title.
Most of the ills commonly blamed on globalization, he argues, are caused by “the continued bulking presence of antimarket policies and institutions” in many of the developing and emerging market countries. The real blame for Russia’s problems, for instance, should be placed on such matters as the efforts of its federal and regional governments to prop up moribund industrial enterprises from the Communist era. Such explicit subsidies, the author notes, have been as high as 8 to 10 percent of GDP in recent years. All over the Third World, protectionism is still strong, with tariff rates averaging 13.3 percent in developing countries, compared with rates of 2.6 percent in the industrialized nations.
Yet Lindsey concludes Against the Dead Hand optimistically: “For a century the world was enthralled by the false promises of the Industrial Counterrevolution; the chains of misplaced faith have now been broken, and the revival of globalization is one consequence. The present era, uncertain and trying as it sometimes may be, is thus a time of deliverance. Furthermore, there is good reason to believe that we are on our way to somewhere better.”
The depth and breadth of the opposition to globalization, and the conviction of those who oppose it, are best captured by an older volume, The Case Against the Global Economy — and for a Turn Toward the Local (University of California Press, 1996), edited by Jerry Mander and Edward Goldsmith. Containing 43 essays in more than 500 pages, the book surveys the antitechnological, anticapitalist, pro-labor, and environmentalist critiques of the globalization agenda. Just about the only constituency not represented are the anarchists, those black-clad provocateurs who have led the violent protests at world trade meetings in Seattle, Genoa, and elsewhere, and who have probably done more than anyone else to call attention to the antiglobalist position. Essays on such subjects as the perils of deregulation, the problems of corporate governance in an interconnected world, environmental concerns, and the social disruptions caused by the pace and intensity of economic change raise issues that even globalization’s defenders can’t ignore.