Wondering what comes next

The liberal world order has been defined as standing for “greater individual freedom, greater choice, support for democratic forms of government, a fundamental faith in free-market capitalism and private enterprise, a belief in constitutional forms of government with divided powers, an independent judiciary, separation of church and state, a strong support for free trade and an aversion to protectionism, among other things”. Obviously there is a lot to like about these values. Most economists believe that this system is the one that is best suited to the creation of wealth. However the predominance of the liberal world order in the last 30 years has also demonstrated that while the system is good for the creation of wealth overall, it isn’t all that good in the distribution of that wealth. That not only leads to a lot of opposition, but is also somewhat self-defeating in the long run: Concentrated wealth is less good at further powering the economy than distributed wealth.

In the USA and a lot of other places the current main opposition against the liberal world order comes from the right, from nationalism, protectionism, populism, and ethnocentrism. However if you look at those right-wing forces enacting policies like the current US tax reform or the Brexit from the UK, it is likely that the right will not solve the problem of wealth distribution any better than the liberal world order (and will presumably create less wealth in the first place). Blaming foreigners and the media will only get right-wing politicians so far until the people realize that they aren’t in fact “better off than they were four years ago”. It is that, and not the whole lot of unrelated shouting about various values, that ultimately will bring change. The liberal world order failed the people, but the conservative version isn’t doing any better. So I’m wondering what will come next.

One likely answer is in the form of people like Bernie Sanders and Jeremy Corbyn. The economic left might one day look like a good answer to people whose main concern is wealth distribution, because the economic left has always stood for redistribution of wealth. However the economic left also has some policies in their book that hinders wealth creation more than necessary for a fair distribution. And they have a long history of ending up with “more equal than others” policies that aren’t in fact much closer to a fair distribution of wealth than the conservative version.

What an optimist could hope for would be a reformed liberal world order, the same values as above but with a priority for wealth distribution and against too much wealth concentration. A vision like in Robert Reich’s Saving Capitalism. However if you look at how the world previously solved excesses of wealth creation, there are only few examples of peaceful solutions (e.g. Theodore Roosevelt) and lots of examples of the wealth ending up destroyed or redistributed through war and revolution. A pessimist would buy gold coins instead of bitcoins.