(I would like to post the whole darned text, but it is rather long).

Grand economic theories rarely last more than a few decades. Some, if they are particularly in tune with technological or political events, may make it to half a century. Beyond that, little short of military force can keep them in place.

The wild open-market theory that died in 1929 had a run of just over 30 years. Communism, a complete melding of religious, economic and global theories, stretched to 70 years in Russia and 45 in central Europe, thanks precisely to the intensive use of military and police force. Keynesianism, if you add its flexible, muscular form during the Depression to its more rigid postwar version, lasted 45 years. Our own Globalisation, with its technocratic and technological determinism and market idolatry, had 30 years. And now it, too, is dead.

the signs of decline are clear, and since 1995 those signs have multiplied, building on one another, turning a confused situation into a collapse.

We have scarcely noticed this collapse, however, because Globalisation has been asserted by its believers to be inevitable - an all-powerful god; a holy trinity of burgeoning markets, unsleeping technology and borderless managers. Opposition or criticism has been treated as little more than romantic paganism. It was powerless before this surprisingly angry god, who would simply strike down with thunderbolts those who faltered and reward his heroes and champions with golden wreaths. If Globalisation has seemed so seductive to societies built upon Greek and Judeo-Christian mythologies, perhaps the reason is this bizarre confusing of salvation, fatalism and punishment. Transferred to economics, in however jumbled a manner, these belief systems are almost irresistible to us.

The British and French empires had vaunted and defended their power in similar ways from the late 19th century on; that is, just as they began to collapse. And as the various 19th-century nationalisms declined into ugliness, their supporters increasingly transformed them into a matter of race.

Inevitability is the traditional final justification for failing ideologies. Less traditional - and a sign of inherent weakness - is the extent to which Globalisation was conceived as old-fashioned religiosity. Perhaps the economists and other believers who launched Globalisation were instinctively concerned that people would notice their new theories were oddly similar to the trade theories of the mid-19th century or the unregulated market models that had been discredited in 1929. And so treating the intervening 40 years as an accidental interval, they began where their predecessors left off: with religious certainty.

This is something I've been saying, though less concisely or coherently, for several years.  So of course I'm pleased to find that Saul has been thinking along similar liines.

Globalisation materialised in the 1970s from the sort of geopolitical vacuum or fog that appears whenever a civilisation begins to change direction, to grope its way around a corner from one era to another.
[...]
What caused that particular void? Perhaps a quarter century of social reform had left the liberal elites exhausted. The need to manage a multitude of enormous new social programs that had been put in place in a democratic manner - an ad hoc manner - made it difficult for political leaders to concentrate on the main line; that is, to concentrate on a broad sense of the public good. Instead, governments were caught up in the endless and directionless details of management. Or perhaps the cause of the vacuum was the resulting reliance of those political elites on technocrats, who understood little of the debate - in fact, distrusted it - and so drew the leaders into isolation.

This seems to me a cogent critique of some of the negative side effects of the Welfare State projects and the professional bureaucracies and technocracies that rapidly encrusted them like barnacles on the ship of state.

As for the new force or ideology that came forward to fill the vacuum, it involved an all-inclusive strategy called Globalisation - an approach that contained the answer to every one of our problems. It was delightfully seductive. It contained simple, sweeping solutions and, as with all successful religions, lodged ultimate responsibility in invisible untouchable hands. Thus Globalisation required no one to take responsibility for anything.

This transcendent vision quickly filled the vacuum. I first heard the variety of personal passivity produced by this belief system on French national television in a speech by Giscard d'Estaing. He had been elected as a new-style political leader - a brilliant economist. Modern. Almost postmodern. He was to lead society via the economy. But he came in just after the 1973 collapse, which included high inflation and unemployment. After a year or so of struggling with the collapse, Giscard went on television to tell people that great global, indeed inevitable, forces were at work. There was therefore little that he could do. Nation states were powerless.

And though Saul does not develop this theme much further, I ask myself what relationship this official passivity and faux fatalism bears to the documented decline in voter turnouts over the period in question...

The reconceptualisation of civilisation through the prism of economics had reached a critical barrier. Beyond that barrier any international exchange that involved a commercial element would be treated as fundamentally commercial. Culture would be seen as a mere matter of industrial regulation; food, as a secondary outcome of agricultural industries.

This is a point on which I have written and thought a great deal;  what becomes of a culture when its most fundamental metaphor is commerce, i.e. when the model of commerce becomes the Platonic ideal and template for all human interactions?

Those who preached Globalisation couldn't tell the difference between ethics and morality. Ethics is the measurement of the public good. Morality is the weapon of religious and social righteousness. Political and economic ideologies often decline into religious-style morality towards the end. But Globalisation had shoved ethics to the side from the beginning and insisted upon a curious sort of moral righteousness that included maximum trade, unrestrained self-interest and governments alone respecting their debts. These notions were curiously paired with something often called family values, as well as an Old Testament view of good and evil.

It somehow followed that if countries were in financial trouble, they were moral transgressors. They had to discipline themselves. Wear hair shirts. Embrace denial and fasting.

This was the crucifixion theory of economics: you had to be killed economically and socially in order to be reborn clean and healthy. For a quarter century, under the severe hand of the IMF, this moralising and emotionally charged approach has been applied to the developing world with absolutely no success. Oddly enough, it had been presented as a form of cool, detached utilitarianism. Those who applied the theory seemed to fail the basic philosophical test of functioning intelligence and ethics - the ability to imagine the Other. They simply insisted, as developing-world debts continued to rise on a rollercoaster of instability, that those people must learn to act in a more predictable manner.

Which brings to mind rather aged priests insisting that young men should take cold showers and exercise more.

Saul's observation that ideologies often decline into rigid moralities or zealotry "towards the end" parallels thoughts I've been struggling with for some years about the notion of "life cycles" in human institutions, and the symptoms of senescence in same.  The moral righteousness and "Scarlet Letter" aspect of IMF's punitive policies towards the Third World have long been evident to many critics, Saul just sums it up  succinctly and more wittily than most.

In a depressing game of leapfrog, the Yugoslavian settlement competed with a genocide in Rwanda, where half a million to a million people were murdered. This is a remarkable statistic.

In a global world of economic and social measurement, we are bombarded daily by apparently exact statistics measuring growth, efficiency, production, reproduction, sales, currency fluctuations, comparative levels of obesity and orgasms, divorce, salaries and incomes. Yet we don't know, or don't care to know, whether it was a million or half a million Rwandans who were massacred. And the genocide was facilitated by Paris and Washington, using old-fashioned nation-state powers at the UN security council to block a serious international intervention. The Rwanda catastrophe then morphed into the Congo catastrophe, involving 4.7 million deaths between 1998 and 2003. Or was it 3 million? Or 5.5 million?

The point is that the inevitability of global economic leadership has been irrelevant through all these crises. While the true believers speak of Globalisation, we are in fact in the middle of an accelerated political meltdown marked by astonishing levels of nationalist violence.

This is a topic that has engaged posters here, at MoA, and on other fora and blogs:  whence comes this resurgence of nationalism, religious extremism, revanchism, ethnic separatism?  Wasn't "free trade" supposed to ensure a web of mutual dependency that would eliminate nationalistic warfare?

There is also the problem of failure to predict, i.e. even in the realm of finance and economics the neolib orthodoxy has demonstrated poor predictive powers in practise (almost as poor as the Soviet planners achieved with similar hubris, confidence, and self-righteousness):

For a short period it looked as if the IMF's punishing approach might actually work. For a dozen years most Latin American governments tried to follow instructions laid down by the IMF, Western governments and the private banks. They endured crucifixion economics, and in many cases this eventually produced apparently solid growth, even if the parallel result was a greater rich/poor gap. But in each case the recovery was followed, a few years later, by even greater collapse. It turned out that such prolonged austerity had weakened, not strengthened, the social-economic fabric. So after all of the liberalisations, privatisations and inflation-stabilisation programs, growth in Latin America in the late 1990s was a little over half what it had been before the reforms.

True believers will tell you that it could have worked, if only there had been less nepotism, weaker unions or less corruption. But real economic policies in the real world don't require perfect conditions. Perfect conditions don't exist in the real world. Western growth over two centuries has come in spite of our own shifting flaws.
[...]
Malaysia responded to an economic meltdown in Asia by refusing to follow the Global rules. The government pulled its currency off the market, made it nonconvertible, pegged it just low enough to favour exports, blocked the export of foreign capital and raised tariffs. These measures were met by an explosion of Western moral fervour. Malaysia could not do this. Its economy would not survive. The leading international emerging-markets index expelled them. Then everyone averted their eyes from the inevitable collapse. In 1999, a short year later, that same index sheepishly readmitted Malaysia. Smarter merchant bankers began to praise the possible long-term investment advantages of pegging certain currencies in certain conditions.

In other words, real-world results suggested that the official dogma was incorrect. But the official dogma serves to enrich an elite few, serves as a cover for wholesale looting and expropriation (something which Saul refrains from discussing, but Stiglitz and others have plenty to say about this).

Saul also addresses a longstanding bête noire of mine:  gigantism (whether Soviet or corporate, the results are similar):

As for the romance of gigantism - of corporate size as a criterion for industrial success - it was beginning to look pretty silly. Endless mergers had led to high levels of unserviceable debt and bankruptcy. It was as if size had replaced thought. As if it were a male thing.

It was all beginning to resemble the 17th- and 18th-century speculation markets - the South Sea Bubble, John Law and the French regency, the Dutch tulip-bulb frenzy. The larger the corporations grew, the slower and more directionless they became - enormous management structures frightened of serious investment and risk. They resembled out-of-control bureaucracies. Yet the whole argument in favour of Globalisation had been the apparently desperate need to wrench power from the bureaucracies and place it firmly in the hands of real owners capable of taking real risks.

More perhaps than the genocides, the disorder in the streets, or the debt crises, it was those simple recurring images of corporate ineptitude, combined with an absence of self-criticism, that first made clear the decline of Globalisation. How then could any of us seriously believe that our redemption lay in the reconceptualisation of civilisation so that we could all view it through the prism of business and economics?

The larger the corporations became, the more deregulation released them to be themselves, the faster they slipped out of sync with their civilisation and even with their customers and shareholders.

Saul concludes that nationalism is resurgent, and that this can mean good things and bad things.  National governments contending with transnat pharmacorps for humane pricing on HIV-management drugs, for example, he considers a benign nationalism at work.  Ethnic separatism, cleansing campaigns, territorial aggressions, resource wars are costly negative nationalisms at work.  His conclusion is inconclusive:  he thinks we are at an historical cusp, an interregnum between the failure of a grand ideology and the emergence of something new.  The dice are rolling according to Saul;  but the Cult of Globalism in his opinion is expiring fast, and will soon find itself on that proverbial scrap heap of history where exploded theories sit and rust away quietly.

On the whole I think he's an optimist :-)  And encoded, unexamined, in his text is the underlying Growth Is Good mantra which cannot remain unexamined much longer.    But I found this essay interesting reading, and it inspires me to try his book Voltaire's Bastards.  Whether I agree with it or not, at least it promises to be readable :-)