The Threat Of Autarchy

The force of globalisation is an irreversible reality, and it is countries like India and China that will nurture it going forward.

- Gautam Chikermane

THE ONGOING GLOBALISATION of autarchy—a phenomenon that has afflicted nations in various forms since the global economic crisis hit the haves of our planet on 15 September 2008 but has got a rhetorical momentum with the flourishes of US President Donald Trump over the past two months—is not new. But for every economy that threatens to or does close its economic borders through tools in the hands of its sovereigns, there are counterbalancing forces that can realign themselves to benefit from those closures.

Let’s not get carried away by the rhetoric, though. Step back and see that the resurgence of nationalism and self-sufficiency through the erection of cultural and economic barriers and walls seducing one strong nation after another is only a political construct. Economists have captured this in one word—autarchy, which the Routledge Dictionary of Economics defines as “a completely closed economy which does not engage in international trade”. The swing, if that, will be high on oratory and short on actions. Today, the new global political narrative seems to say, “from autarchy began the march of globalisation, in autarchy it will end.” I argue that this return to autarchy is really a realignment of world affairs—globalisation is not, and cannot, end.

Of course, nobody, not even Trump, is actually shutting down borders. These are merely the first indications of muscle-flexing, message mongering to those who elected him. It is equally a signal to other large powers like China as an emerging superpower, West Asia as a region and emerging powers like India, that the role of US in international foreign policy will be limited and the new regime comes with an economic tit-for-tat.

The impermanence of this inward and aggressive rhetoric too is out there—the return of Trump to One China policy that insists on derecognising Taiwan as a nation, for instance.