The 21st Century will be defined by the struggle between Nationalism and Globalism

The 20th Century was defined by the struggle between Capitalism and Communism. The 21st Century will be defined by the struggle between Nationalism and Globalism.

On July 1, 1944, the great powers of the 20th century arrived in Bretton Woods, New Hampshire to define a new postwar order. Europe, weary and devastated by two great wars that took more than 77 million lives, knew that security would only be found in a new world order.

Breton Woods was followed in 1948 by the Hague Congress, in which the European Movement International was born. This was a precursor to the 1957 Treaty of Rome and finally the Maastricht Treaty which led to the formation of the European Union.

In the post World War 2 era, the Cold War brought stability to the world by aligning countries in clear black and white terms along ideological lines. Countries were either communist or capitalist, West or East, with both sides far more interested in prosperity than a third world war.

The Rise of Globalism

Surely from 1944 through 2017 there were indeed wars, particularly at the outset as countries began to choose sides. However, all but one of those wars was fought outside of Europe. Slowly countries abandoned nationalism and joined the new world order, the most important of which being mainland China following Deng Xiaoping’s ascendance in 1978 and their admittance onto the United Nations Security Council in 1971, replacing the Republic of China (ROC).

Though United Nations was perhaps the foundation of the new world order, free trade and globalism quickly became vital tools in maintaining it. With the creation of the World Trade Organization in 1995, the world doubled down on globalism and trade, and worldwide politics shifted toward the free movement of people regardless of border. In 1970, the U.S. immigrant population stood 9.6 million, or 4.7 percent of the total US population. By 2014, that figure jumped to 42.4 million, or 13.3 percent of the total US population[1].

But nationalism and militarism, thought by many to be dead and buried after the second world war, in fact was never really gone, and as globalism gained momentum, it created both winners and losers.

Though I believe that we can officially state that the Bretton Woods world order is ending in 2017, there were precursors. The renewed rise in nationalistic feelings across the globe did not start with Donald Trump, nor with Brexit, but with Vladimir Putin’s rise to power in 2000. Putin, eager to restore Russia to its former greatness, rebuilt the country’s military and used it to restore hegemony and alliances lost during the Soviet collapse.

The Arab Spring in 2011, and resulting civil wars and regional conflicts, are a direct result of the struggle between globalism and nationalism and should be viewed as the first hot wars between the two sides. On one side stood Europe and the United States, who intervened to dethrone stubborn tyrants in the Middle East. On the other side was Russia, who stood with those tyrants and traditional allies in Syria, Iran and Egypt.

Ironically these conflicts waged by globalists in the Middle East, beginning with the second Gulf War in 2003 and intensifying with attempted regime change in Libya, Egypt, Yemen and Syria, are the principal catalyst for the fracturing of the world order. These wars resulted in millions of refugees from these nations, with no choice but to flee the destruction of their homeland. As one of globalism’s principal axioms is a borderless world with freedom of movement, a mass migration into Europe resulted, putting economic and political strains on the union.

A New World Order for the 21st Century

The benefits of globalism have not been well distributed, and there is no better example than the United States. According to the Allianz Global Wealth Report 2016, the United States holds 41.6% of the world’s total wealth but has the greatest amount of wealth disparity, with the most concentration of overall wealth in the hands of the proportionately fewest people.

This wealth and income inequality can be directly traced to the loss of the American manufacturing base through free trade and globalization. Gutted by the loss of blue collar jobs, and with a population weary from seemingly endless post 9/11 conflicts and interventions, in the 2016 presidential election the United States abandoned globalism and embraced nationalism.

The United States is not alone in changing direction. The United Kingdom is sprouting new nationalist roots with its withdraw from the European Union.

Countries such as Russia, the United States and United Kingdom either have suffered under globalism, or have benefited from nationalism. These countries now find themselves to be unlikely allies. Likewise nations that benefit the most from globalism, such as the European Union and China, must fight to maintain the status quo or suffer irreparable economic damage.

As countries begin to align under this new world order, it is important to note that Nationalism also means doing what is in a country’s self-interest, not the world’s self-interest. As such, countries that once fell under the United States’ powerful umbrella of protection in the prior world order will likely need to fend for themselves.

Geopolitical Earthquake

We are on the cusp of a geopolitical earthquake with a magnitude not seen since 1944. The traditional East-West alliances no longer apply, as those alliances are now being drawn in accordance with the split between nationalism and globalism. Those alliances are still being formed and will continue to evolve, just as alliances during the struggle between communism and capitalism in the previous world order developed in the late 40’s, 50’s and 60’s. Those were, of course, very dangerous years as nation after nation declared for each side and minor wars of hegemony were waged.

Some pundits have predicted that this forthcoming struggle will result in the eclipse of the United States as a superpower, to be replaced by China. This is far from certain. China, riddled with debt and fully dependent upon globalism, is in fact extremely vulnerable. It also represents the old world order, the one that started in 1944 and ends in 2017. Instead, it is likely that we are on the brink of nation-first world without strong alliances, and one where, just like in the early 20th century without the safety net of free trade, trade wars could very well lead to full-scale military wars.

Though this new struggle has just begun, and sides are still being chosen, some lines have already been drawn. I expect the United States to align themselves with their traditional cold war ally, the United Kingdom. However both will find themselves an unlikely ally in Russia. Countries such as Turkey and Egypt are also likely allies.

China will lead the globalist cause, for the very existence of the regime depends upon it. It will be joined by the European Union, in its current form, most Latin American nations, and likely most of Asia.

Finally, in 2017 a battle for Europe and its union will take place in Europe, and it will be fought in forthcoming elections. Though not certain, it is likely that the European Union will disintegrate in the next decade, possibly replaced by a new union with less nations and a more common belief structure.

The future is uncertain, but we can expect that this new struggle between Globalism and Nationalism will define the rest of the 21st century.

Michael Puscar is an award-winning data scientist, philanthropist and entrepreneur and the founder of GITP Ventures, a private equity firm focused upon emerging markets and early stage investments in Latin America.

[1] Migration Policy Institute, April 14 2016, http://www.migrationpolicy.org/article/frequently-requested-statistics-immigrants-and-immigration-united-states