Harold James
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Harold James: Politics are being recast in almost every industrial country (with Japan as the only obvious exception). In Italy, the Christian Democrats collapsed in the early 1990s. In France, the old two-party system, comprising center-right and center-left forces, was upended in the 2017 presidential election. And in the United Kingdom, Brexit has caused deep political fragmentation, particularly in the Conservative Party.

French President Emmanuel Macron, who created his party La République En Marche ! shortly before the 2017 election, offers the best modern example of how politics can be remade in the twenty-first century. It would have been impossible to predict the party’s emergence even in late 2016.

In the UK, the first-past-the-post electoral system makes launching such a political movement much more difficult. But that does not mean it is impossible for new parties to emerge, let alone for old parties to be reenergized and transformed. The Liberal Democrats, for example, now stand as a beacon of hope and rationality.

If voters learn to make tactical coalitions within individual parliamentary constituencies, the Liberal Democrats could potentially stand in the tradition of the nineteenth-century Whigs or Liberals – a movement that, paradoxically, represented the “true conservatism” of cautious reform and incremental change. Its worldview was memorably depicted in Anthony Trollope’s political novels of the Victorian era.

In those novels, Trollope describes Plantagenet Palliser – a reluctant, painfully shy, and highly self-conscious politician, with a strong sense of patriotism and a deep-seated affinity for public duty. According to Palliser, “what we all desire is to improve the condition of the people by whom we are employed, and to advance our country, or at any rate, to save it from retrogression.” He adds that “the idea that political virtue is all on one side is both mischievous and absurd.”

“Planty Pall” has an enduring appeal. In the 1970s – when the UK was roiled by another constitutional crisis, though not as acute as the current one – a BBC television series based on the Palliser novels helped to fuel a significant rise in the Liberal Party’s opinion poll ratings and even election performance. It helped that the actor portraying Palliser resembled the Liberal leader, Jeremy Thorpe.

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Planty Pall’s attractiveness is rooted not in charisma, but in competence – a quality that is sorely lacking in many countries’ political establishments today. With competent political leadership – underpinned by a holistic vision of “one nation,” instead of a polarizing competition between opposing political tribes – the UK’s situation would prove not to be hopeless.

HJ: Many political commentators have been surprised by the extent to which support for Trump, as measured in opinion polls, has held up. The surprise is not that he is causing long-term damage to both US and international institutions; he was elected on the promise of doing just that.

But perceptions more broadly have often favored Trump. When he took over the presidency, the US was in the later phases of a long economic recovery. His initial tax measures delivered a short-term stimulus (while posing a longer-term threat to fiscal sustainability), and even the trade war appeared to many like an appropriately tough strategy for pushing China to make concessions regarding the protection of foreign intellectual property. Some of the trade war’s domestic losers even reported that they were willing to pay a small price for the national good.

We are, however, nearing a tipping point. Trump’s sudden withdrawal of US troops from Syria is already having disastrous consequences. The impeachment inquiry is gathering momentum, as revelations about Trump, his lawyer Rudy Giuliani, and their associates in Ukraine multiply. And consumers may be badly hit by the planned December 15 tariff increases (just in time for Christmas!). In this context, it is hard to believe that public sentiment will not soon turn against Trump.

Trump has bulldozed the old Republican Party. In his wake, the Republicans will need to rebuild from the ground up, developing an all-encompassing new framework for a center-right movement that considers both social policy and financial responsibility. Such a movement would aim to foster a system in which social arrangements (most fundamentally, the family unit, though not necessarily conventionally conceived) make its members stronger, more energetic, and more engaged participants in broader communities.

A very important series of books and studies (including a new book by Branko Milanović, which I recommend below) have shown that in advanced modern societies, inequality is driven partly by marriage preferences and social bonding among the “elites,” who pass on non-pecuniary advantages in education. The logical conclusion is that functioning families should not be a privilege reserved for an educated upper class. That is the path to social collapse – a path along which we are well advanced.

HJ: Issuing a currency on the promise of convertibility into a set of other currencies raises obvious regulatory issues. And, indeed, such initiatives triggered a good deal of skepticism in the past. In the 1980s, when Europeans pushed for a private European Currency Unit, they had only limited success. The International Monetary Fund has always resisted the idea of widespread private use of its reserve asset, the Special Drawing Right.

But, in Libra’s case, asset-backing becomes an issue only if the currency is used for banking operations or maturity transformations. If it is used purely for payments, it is no more or less problematic than existing currencies. In short, the regulatory problem lies in banking operations, not in the payments system.

Here, it is important to draw on historical experience. Before the nineteenth century, a large share of economic interactions involved multiple competing currencies. Before the pocket calculator or the PC, that obviously created enormous calculation challenges. In the age of mobile Internet, however, there is no reason why different currencies cannot be used for different sorts of economic activity.

And, in fact, “dollarization” is already widespread, with transactions carried out in a major trading area’s currency – not only US dollars, but also renminbi or euros. When it comes to pricing goods or services, there are many reasons why currency baskets might be preferable. Moreover, it is likely that new and different sorts of currencies will emerge.

Of course, new currencies raise some potential issues – most notably, as in the case of Libra, that controlling the means of exchange is a way to access commercially or politically valuable payments information. But that concern also applies in the case of state-organized payment systems. If platforms like Facebook want to encourage users to surrender their privacy, they might consider incentive schemes. Other platforms, with more privacy guarantees, would then provide fewer paybacks or bonuses.

Residents of small countries with problematic governance structures are most likely to lead the way in adopting one – and probably more – of the many digital and alternative currencies. That competition will pose a real threat to monetary authorities and central banks everywhere. But the solution is not to try to ban or hamper the alternative currencies, just as it didn’t do any good when some countries required a human to walk in front of a new-fangled automobile carrying a warning flag.

HJ: That opposition is, indeed, a major challenge facing Europe. But there are many areas where coordinated European-level action is a much more efficient and cost-effective solution – or even the only solution. Security policy is a case in point.

The issue of “Europeanizing” key policy areas will become increasingly prominent, as debate about a coordinated response to the climate crisis intensifies. Linking up national energy markets will remain an important – and challenging – imperative. Europe has made signification progress on gas, with pipelines that can reverse flows making it harder for one big energy supplier to blackmail buyers.

But the use of renewables – particularly solar – will require the transfer of large amounts of electricity from the Mediterranean to northern Europe, and thus much larger-capacity lines. The construction of such lines has always been controversial: even a modest north-south link in Germany has been hampered by local opposition to high-voltage power lines. So, if Europe is going to implement any kind of Green New Deal – which, to be sure, can work only at the European level – an inclusive debate will be crucial.

BY THE WAY . . .

HJ: In many areas – such as health or the environment – people make better decisions when they know more. Referenda that pose big and unclear questions are disastrous, with the Brexit referendum now established as a canonical example. But digital technologies can enable countries to make better choices about specific actions, such as the extent of investment in rail or energy links, and how these should be financed (taxes or user fees).

HJ: Throughout my career as a historian, I’ve often returned to the Great Depression – the seminal catastrophe of the twentieth century (along with World War I, of which the Depression was partly an aftershock). The Great Depression effectively destroyed democracy, the market economy, and the international order, as it encouraged a view of domestic and international politics as a zero-sum game.

It is chilling how much of the radical political rhetoric – and, indeed, logic – of the interwar period can be heard today, even though the 2008 global economic crisis was much milder than the Great Depression. For example, the Financial Times commentator Martin Wolf recently drew a parallel between the logic of British Prime Minister Boris Johnson and the Nazi propagandist Joseph Goebbels. “The modern structure of the German State,” Goebbels stated in 1933, “is a higher form of democracy in which, by virtue of the people’s mandate, the government is exercised authoritatively, while there is no possibility for parliamentary interference, to obliterate and render ineffective the execution of the nation’s will.”

Today’s politicians have even echoed Adolf Hitler himself. On November 10, 1933, speaking to workers in Berlin, Hitler denounced – without using the word “Jews” – a small rootless international “clique” of “people who are at home both nowhere and everywhere, who do not have anywhere a soil on which they have grown up, but who live in Berlin today, in Brussels tomorrow, Paris the day after that, and then again in Prague or Vienna or London.”

These people, Hitler continued, as a man in the crowd shouted “Jews,” are “the only ones who can really be described as international elements, because they can do business everywhere. The people, however, cannot follow them, because the people are linked to their home, to their soil, to the possibilities of their state, their nation.”

That speech was perhaps deliberately recast by a modern leader of Germany’s far-right Alternative für Deutschland, Alexander Gauland, last year. More terrifying, it was unintentionally echoed by an undeniably decent and civilized politician: Johnson’s predecessor, Theresa May. In her first Conservative conference speech as prime minister, May said, “Today, too many people in positions of power behave as though they have more in common with international elites than with the people down the road, the people they employ, the people they pass in the street. But if you believe you’re a citizen of the world, you’re a citizen of nowhere. You don’t understand what the very word ‘citizenship’ means.” For a world facing shared challenges, the revival of such poisonous rhetoric and zero-sum thinking is catastrophic. Not only will it fail to strengthen communities; it will weaken them.

HJ: I do think history should be taught in schools and universities. It is, after all, a tremendous experimental field, which reveals which strategies and tactics have succeeded and which have failed, sometimes quite disastrously. But, for the field to serve its purpose, historians must resist being pushed in two professionally tempting directions: toward pointillism, which can distort the subject until it becomes practically irrelevant, or toward propaganda, with historians citing the past to advance polemics about the present.

After the fall of the Soviet Union, Francis Fukuyama declared that we had reached the “end of history.” But, in the twenty-first century, history bit back. Momentous events – such as the September 11, 2001, terrorist attacks in the US and the country’s ensuing “War on Terror,” as well as the global financial crisis – turned some historians into pundits, sometimes with damaging consequences. A number of prominent British historians contributed to the Brexit vote, by spreading fallacious notions about the centrality of sovereignty to the British constitutional tradition. It is both limiting and misguided to compare the UK’s departure from the EU to Henry VIII’s declaration of sovereignty in opposition to the Roman pontiff.

HJ: I love language. I love stories. I love literature. If I hadn’t been a historian, I would have loved to have been an actor – one with a permanent engagement with Shakespeare.