GLOBAL INTEGRATION How Bad Are Things Really? The West is down, the East is uncertain. Still, we have spring. ROGER COHEN

GRAPHIC: EOIN RYAN GLOBAL INTEGRATION How Bad Are Things Really? The West is down, the East is uncertain. Still, we have spring. ROGER COHEN http://outlookindia.com/article.aspx?279480 Web Wide World The financial crisis, at a deeper level, is a crisis of transition. Confidence is draining out of the West, but the 'upstarts' aren't ready to take over. Not just BRIC, even the Arab world has soaked up the new confidence, but it must solve the Israel riddle The way to go is integration, though how to advance it is a vexing matter due to disparate governance models *** I recently spent a few weeks in one of Euroland's basket cases—a sunlit southern country whose debt exceeds its output and whose bonds nobody wants. The nation was run by a flamboyant former crooner who squeezes in his governing between dalliances. It is a place, I discovered, that has crisis writ large on every facet of daily life: the stylish throng strolling at dusk on streets packed with new cars, the designer-label clothes, the seductive boutiques. People looked stricken as they reviewed their vacation plans for Istanbul or the Alps. The billionaire leader, his face lifted and tucked, seemed to be suppressing a great guffaw at the agony of Euroland. He struggled to look serious. Families laughed, lovers lingered, lunches of delectable abundance drifted into lazy afternoons. The gloom was overwhelming. I came away in a funk, convinced that Italy stood on the brink of some ghastly fate. Quite possibly, it seemed, Italy would continue to be Italy. The thing about a wired world of 7 billion people, a small fraction of whom are Italian, is that policymaking increasingly looks like a flailing exercise in trying to catch up with and regulate forces unleashed by their creativity. I've heard estimates that as much as a third of global economic activity never registers these days in official statistics. Certainly, Italian shopkeepers still ignore their decorative cash registers, installed at the taxman's insistence, preferring to scrawl receipts on scraps of paper—or not write them at all. Even taking account of Europe's accumulated wealth and its cushioning effect in hard times, the gap between the talk of crisis and the scarce physical evidence of it is large. The 1930s this is not. Italy, a rich country, survives the incompetent Silvio Berlusconi much as Belgium does just fine on its protracted inability to form any government whatsoever. As the world passes that 7-billionth inhabitant mark, there are more obese than hungry people on the planet. Many of the obese are poor. Past generations could only dream of such problems. Huge numbers of people have been lifted out of poverty in the past decade. Population growth is slowing. The worst predictions of famine, pestilence and a poisoned atmosphere have proved exaggerated. China, India and Brazil are not alone in feeling the tide of history flowing their way. So how bad are things really? That depends where you sit. The world feels particularly unpredictable because what is portrayed as a financial crisis in Frankfurt and New York is, at a deeper level, a crisis of transition. Confidence has drained out of the part of the world that is used to running the world while the ever richer upstarts, anti-western in varying degrees but unsure still what new principles to embrace, are not ready to take over. In the last century, the British handover of power to the United States had the seamless quality of a transaction between cousins. America and China are tied at the hip and have learned how to conduct business. But they remain cultural rivals. "We are used to a small group of like-minded democracies calling the shots, but these democracies now have increasingly less influence over world politics," says Charles Kupchan, a professor of international affairs at Georgetown University in Washington. "We are heading toward no one's world, a world of multiple modernities, interdependent and globalised without a dominant political centre or model." No wonder a sullen anger inhabits much of the West (excluding prudent Canada). For the inhabitants of Euroland (the 17 nations that share the euro currency), it's blowback time. Nicolas Sarkozy, the French president, now says it was an "error" to admit Greece to the euro. The French should know. The shared currency was largely their idea. It was a means to tie Germany to Europe; and how better for Europe to crown this political statement than including in the brotherhood of shared money the cradle of its civilisation, Greece? India isn't alone in feeling the tide of history turn its way. (Photograph by Manpreet Romana) The Acropolis loomed much larger at the time than Greece's bloated public sector or ultra-sketchy work ethic. Risk was waved away. Of course Greece could be hitched to the same economic wagon as Germany! Of course there was no risk in burying toxic loans in mortgage securities! The human capacity to disregard facts and believe that pigs have wings is fathomless. Euroland, with its one currency and multiple sovereignties, has now finally had to go hat in hand to China, whose $3.2 trillion in foreign exchange reserves could give a boost to a bolstered bailout fund. There could scarcely be a more direct symbol of the way power is shifting today. A friend with property interests in Vancouver tells me there have never been such boom times. The Chinese are buying everything they can get. China's the place to get rich; the West's the place to buy into the rule of law. The first question the acquisitive Chinese ask in Vancouver or London is: can anyone take this away from me? The West does still offer protection from the arbitrariness of the one-party state but its self-confidence is shot. What's that whooshing sound? It is the tide of jobs disappearing, never to return. What is it that does not sleep at night? The mountains of debt accumulated over the past decade. What is the racket in the streets? The legions of the Occupy movement enraged by the impunity of the powerful. What is that cracking sound? The agony of Euroland caught in the halfway house between federation and nations. The great vexation today is about integration—how to advance cooperation when those at the table have disparate views on governance. That's patent at the euro level and true, if less obvious, at the global G-20 level. More integration is needed, but when people are angry they turn tribal: the objective imperative meets emotional resistance, be it in the form of the Tea Party or the Dutch rightist, Geert Wilders. Nobody yet knows how to run a globalised world or make it more equable. That is the issue of our times, one to which China, India, Brazil and other new powers will have to make far more substantive contributions than they have. America, divided within, can no longer impose its will, yet the world's girders are still provided by Pax Americana. China is ready to go along with that for now in the name of the stability necessary for its full development by 2050. There's a thirsting for some new order but no readiness to adopt one. This translates as unease. Demonstrators in New York and Madrid know what they are against but it's much less clear what they are for. The overthrow of capitalism sounds very 20th or even 19th century. Reforming capitalism, offsetting its harshest aspects, is also old news. It has been tried in the form of the welfare state—and these systems are under acute pressure as people live longer. No, the real if poorly articulated focus of Occupy is reforming globalisation, particularly the way globalisation favours the wealthy. Some ideas, like the Tobin tax on global financial transactions, have been around for years but they're almost impossible to apply. What's left, it sometimes seems, is the uplift of togetherness. With modern society and the internet comes the scattering of people in solipsistic universes dominated by screens. The Occupy movement is also a reaction to that: an awakening to the possibility of coalescing to bring change. An inspiration for the movement came from the Arab world. But there's a difference: the occupiers of Tahrir Square, the streets of Benghazi and the avenues of Tunis knew what they were for: more representative societies. The road to this goal has already proved uneven. A great debate over how to reconcile Islamic faith and modernity has been engaged. But the direction is set. The confidence that has drained out of the West has not merely headed in the direction of the bric countries. A share has been seized by Arabs.     The birth of a new Arab pride is important. Arabs who are agents of their own lives are no longer Arabs who must seek in an enemy the explanation of their ills.     Humiliation is a powerful force. For a long time, it undermined the Arab world. Ottoman subjugation was followed, after World War I, by the encroachment of the western powers. Then fell the most crippling blow: Israel's defeat of the Arab armies in 1948 and its subsequent successes. Palestinian refugees piled up in eternal camps; repeated wars only sharpened the dominance of the Jewish state. A dismissive phrase—"the Arab street"—came to characterise an indignant rabble. Until, on those very streets in 2011, the basis for a new pride was laid, not one fixated on a symbol of resistance to Israel—a Nasser, a Hassan Nasrallah—but one forged in shared and transforming endeavour. In some senses, Arabs said basta—enough is enough—through their Spring to the Israel alibi. After the establishment of Israel, David Ben-Gurion was pessimistic about the possibility of peace. "Why should the Arabs make peace?" he said. "If I was an Arab leader, I would never make terms with Israel. That is natural: We have taken their country. Sure, God promised it to us, but what does that matter to them? Our God is not theirs. We came from Israel, it's true, but 2,000 years ago, and what is that to them? There has been anti-Semitism, the Nazis, Hitler, Auschwitz, but was that their fault? They only see one thing: we have come here and stolen their country." Over more than six decades, that pessimistic assessment has been accurate. The will of the United Nations as expressed in Resolution 181 of Nov 29, 1947—calling for the establishment of two states, one Jewish and one Palestinian Arab—has proved unworkable. Arab rage was never quenched by the perception of a European attempt to expiate Nazi crimes in Palestine. The determination of Jews to hold onto the sliver of land delivered to them by a world guilty of centuries of persecution never relented. It is hard, in the face of a confrontation so unyielding, to be optimistic. Still, two lessons of the world today are these: things are not quite as they appear (in Italy or elsewhere) and change can be quite sudden. The abrupt birth of a new Arab pride is important. It shifts the focus. Arabs who are agents of their own lives are no longer Arabs who must always seek in an enemy the explanation of their ills. Humiliation leads to more war: it did in Europe when the Versailles Treaty of 1919 punished Germany. Only when Europe began to integrate did it finally end war on the continent. Europe's present difficulties have provoked much facile mockery, but its model is an inspiration and can be helpful in the new Arab world. As in Euroland, as in the totality of a globalising world, integration is inevitable in the whole Middle East. The only question is what further price in blood and treasure will be paid before it is achieved. The writer is a columnist for International Herald Tribune and The New York Times This special commemorative issue was brought out as a stand alone publication TEXT SIZE    PRINT SHARE COMMENTS FILED IN:  AUTHORS:  ROGER COHEN  SECTION:  INTERNATIONAL  SUBSECTION:  ESSAYS