ArticleIt’s the roaring twenties again. Let’s hope it ends differently. Donald Trump’s decision to deny Australia an exemption from tariffs on steel and aluminium going into the US, punctuates an isolationist project to cut aid, provoke trade wars and unpick the global economic order. It replaces Keynes and Friedman with Nietzsche and Machiavelli and has an invisible moral layer that should worry all of us, not just markets and economists.
The worst thing about this emerging new world order might be its invisible metaphysics – nurturing a pernicious moral stagflation that elevates self-interest and ignores the reality of our shared future.
In his award-winning book Surrounded by Narcissists, behaviour expert Thomas Erikson illustrates a recent drift towards individualism through the growth in SUVs on the roads. Research suggests that people drive SUVs for their safety benefits and slightly better – elevated – view while driving. However, these benefits come at the expense of those who don’t drive SUVs. This leads to more and more people being induced to look out for themselves at the expense of others, hence the explosion of SUVs. Self-interest tends to self-replicate. But there’s another way.
Donald Trump should have a beer with my Dad. Now retired – he’s an engineer who specialised in textiles. Trained at India’s prestigious PSG College of Technology, he was managing a textile factory in Sri Lanka (where my family’s from) at age 25. It was short-lived. Sri Lanka’s civil war drove us out of the country and he found himself in Australia starting over. What followed was an impressive career that took him up the corporate ladder and through five companies over three decades. He was effectively forced out of every job he had because of tariff reductions. In the 1980s and 90s the Hawke-Keating government took away the local textile industry’s tariff and quota protections. As that happened, Australian textile companies were brought to their knees.
My Father is front-and-centre in the Trumponomics playbook – a hard-working person who left his job five times because of free trade. He’d be forgiven for cheering for trade wars, tariffs and zero-sum diplomacy. But that’s not how he sees it.
When I was in grade 4, I remember my Father telling me how free-trade cost him his job. Then he said something that’s always stayed with me. He said that in life and in business, we should never turn inwards.
He said that competition, connection, partnership and integration with others is better for us and them.
He said that because he lost his job, more people in other countries would get jobs and that poorer Australians would be able to buy more things at lower prices here. Then he got on with finding his next job, knowing that it would probably be short-lived too. He didn’t see the world as a zero-sum game. He knew that in an outward looking world, me and my children would have better opportunities to travel, learn, earn and work. And he knew that our family’s future was linked to the futures of others.
It’s a generous but pragmatic posture that chimes with the Bible’s call to human interconnectedness. In the book of Ecclesiastes – part of the Bible’s ‘wisdom literature’ – it is written that ‘two are better than one, if one falls then the other can help…but pity anyone who falls and has no one to help them up.’ It was written for the individual, but national economies are merely groups of individuals. For nations and people alike, we’re not supposed to travel alone.
Don’t get me wrong. Free trade is far from perfect. A lack of equally distributed opportunities and widespread exploitation require continuous attention. But these are reasons to filter the bathwater, not throw out the baby.
The original roaring twenties (the 1920s that is) – at their best – were an age marked by innovation and prosperity. Interconnectedness thrived, incomes rose, and fashion, entertainment, art and science scaled new heights. However, the decade ended with tariffs, trade wars and an inward-facing anxiousness that led to the Great Depression and then, to World War II.
After doing some roaring of their own – thanks to a post-covid government spending spree, low interest rates and ensuing consumerism – the 2020s have run into the quicksand of low productivity, simmering inflation and now, eery glimpses of 1920s isolationism. We are rightly concerned about trade wars leading to economic stagflation. We should also be concerned to avoid deeper pitfalls that go beyond economics: Moral stagflation – when uncertainty turns us inward and we turn our backs on each other, and our world.
Max Jeganathan is a senior research fellow at the Centre for Public Christianity. He served as a political and social policy adviser in the Rudd and Gillard Labor governments. This article was first published in The Canberra Times.