Living through interesting times
Popular wisdom often refers to an old Chinese curse: May you live through interesting times. The point being that the humdrum of a quiet and stable life is preferable to the excitement and uncertainty of the unforeseeable.
In the aftermath of World War II humanity came together in its desire to build a peaceful and prosperous future. Several multilateral institutions were set-up, such as the United Nations, NATO, the World Bank and the World Health Organization.
For decades, despite the cold war between the Unites States and the Soviet Union, life was pretty good. Populations grew, and economies expanded, with each new generation expecting to live longer, healthier and wealthier lives than the previous one.
In the late 1980's the iron curtain started to collapse, and the soviet bloc nations eventually embraced Western capitalism and values. After a 20th century marked by two world wars, deadly revolutions in Russia and China and the great depression of the 1930's, humankind stepped into the new century believing the end of history had been reached, with a new era of progress and peace laying ahead; one sustained by free global trade and a consensual Western liberal democracy template to which all nations were, or would at some point be, queuing-up to join.
The financial crisis of 2008 was the first nail in the coffin of this idyllic illusion. The shock waves caused by the near collapse of the global financial system reverberated violently across Western societies, as austerity measures brought hardship to the less well-off. It triggered resentment towards the elites overseeing am increasingly globalised world were many of the jobs available to previous generations had been outsourced to countries with cheaper labour.
Many in the working classes felt abandoned, giving rise to populist movements that mixed economics with nationalism. Brexit and the election of Donald Trump were the most visible manifestations of this phenomena. Fast-forward to 2020 and the coronavirus may be the final blow that knocks down a post-World War II international order based on multilateralism and free trade.
The current sanitary and economic crisis has reclaimed a central role for the State. After several decades dominated by the dogma of the market, we are witnessing unprecedented levels of financial stimulus dished out by governments and central banks attempting to revive pandemic-battered economies. But the enhanced role of the State is likely to stretch beyond the economy and also impact individual freedom.
Privacy and anonymity may become a luxury as mass surveillance is normalized. In China this is already a reality, with effective tracking of citizens data pointed out as the main reason behind the successful containment of COVID-19 in the country.
Francis Fukuyama wrote The End of History and the Last Man in 1992, defending the idea that with the triumph of Western liberal democracy over Soviet communism, humanity had reached the pinnacle of ideologic evolution and the end of history.
As we subsequently learned, the universe conspired to prove him wrong, as it always does. Our history is one of evolving from one socio-political epoch to another and we must never assume that the end of the line has been reached. There will always be 'interesting times' to look forward to.
This article was written by Ricardo Evangelista, ActivTrades Senior Analyst.