Rising Neo-Nationalism Threatens Social, Economic Progress Worldwide

Nationalism is on the rise worldwide. A new form of nationalism has emerged in the last decade that pits nativists, xenophobes, and populists against an increasingly globalized world. “Neo-nationalism” as the trend has become known is leading to increasing belligerence between nations and an uninformed suspicion of the “other” that could lead to far-reaching international confrontation.

Three countries exemplify this trend like none other, with deepening consequences to their national reputation and diplomatic standing in the world. India’s Hindu nationalism is leading to an economic boycott of its most important trade partner, the disastrous pandemic response in the US is diminishing its standing, and Israeli nationalism is bringing it ever closer to annexation.

US nationalism meets COVID-19

For decades US politicians have considered their country to be the best of all, solely based on GDP and military might. Even though the US slipped in important metrics, including education and healthcare, it remained a taboo for politicians to declare the US anything but number one. The US is now not even in the top 10 in most fields that would be considered to be signs of “being the best.”

The US now ranks 27th in education in health, down from 6th place in the 1990s. The country is the 19th happiest country, and the 42nd most corrupt. The country is now the 27th in social mobility, which means that there are 26 countries where citizens are more likely to achieve the “American Dream,” or work their way up from poor to rich.

But amid this collapse of living standard and public services, amid a crumbling infrastructure that needs $4.5 trillion worth of repairs and maintenance before 2025, American nationalism has maintained the fiction that the US is the best country in the world. This mistaken analysis was evident in its approach to COVID-19 that has now cost 125,318 American lives.

The US has considered its privatized and decentralized healthcare system more than capable of resisting a shock that caused much more accessible healthcare systems in Western Europe to tremble. The country’s misplaced nationalism meant little extra effort was mobilized even as evidence of the pandemic’s severity emerged from Europe, leading to a disastrous and deadly failed response that has severely diminished the US’ standing in the world.

Israeli annexation fueled by nationalism

There are few people in the world as familiar with the dangers of unfettered nationalism than the Jewish diaspora. The rise of nationalism in Europe led to increasing antisemitism that concluded in the barbarous mass murder of millions of innocent Jewish people. But history is doomed to repeat itself as Israeli hardliners now fuel a similar type of nationalism within their own nation.

Far-right media continuously turn the native Palestinians into a dangerous “other” and push the country further right. Israeli neo-nationalism is visible on a daily basis in publications such as the Netanyahu-aligned newspaper Israel Hayom, and more mainstream publications such as the Jerusalem Post or the Times of Israel regularly feature highly problematic opinion pieces.

One feature of neo-nationalism that is visible from Hungary’s Prime Minister Victor Orban to Brazil’s President Jair Bolsonaro is the rapid mainstreaming of nationalist thinking. By employing marketing strategies and exploiting social media, neo-nationalists create a world of alternative facts for their supporters.

The world of alternative facts has turned UN-declared illegal settlers into “brave pioneers” and oppressed native people into “dangerous terrorists.” iI has turned the country’s nationalists against the United Nations, through which Israel was founded in the first place. Now misplaced nationalist zeal could lead Israel to commit a blatant violation of international norms and turn itself into a global pariah as nationalists urge Netanyahu to go further and annex even more Palestinian land.

Indian radical nationalism

India’s Hindu nationalists are transforming their country away from the legacy of Gandhi and Nehru and into a dangerously volatile chaos of misinformation, mob violence, and an increasing war fervor against neighboring China. India’s media has enthusiastically whipped up resentment and even violence against local minorities, blamed COVID-19 on local Muslims, and framed an undisciplined scuffle between border troops as a casus belli.

Indian neo-nationalism is likely the most entrenched form of the trend found globally. Mainstream politicians, news reporting, and the government itself continuously misinform and manipulate public frustrations.

The rise of mainstream nationalist fervor could be seen in Indian Prime Minister Nahendra Modi’s 2019 electoral campaign. After his first successful campaign focused on economic development, whipping up nationalism proved easier to deliver. “We were nationalist, we are nationalists and we will remain nationalists,” he said in a campaign speech.

Similar to neo-nationalism in Israel and the US, Indian nationalism is producing a dangerous feedback loop that could turn disastrous.

When a hand-to-hand fight between a few dozen Chinese and Indian border troops led to casualties, there was no critical media left to see the event as what it was. Troops showing poor discipline that should have been court-martialed instead became national martyrs as ill informed masses cried for war against a country with a far superior military and economy.

Divide and conquer

In the end neo-nationalism serves but one purpose: It masks the negative effects our global neoliberal economics have on the poor and middle classes and instead pitches them against each other. By fueling resentment and hatred of the “other,” neoliberal leaders such as Modi, Netanyahu, and Trump can hide the continuous wealth transfer from the poor and working classes to the rich.

Misinformed working-class Indians, Israelis, and Americans have much more in common with those who they are manipulated into hating, than the millionaires and politicians that foment this discord. Neo-nationalism has become the favored approach by politicians who can no longer promise economic development through neoliberalism, as that theory has again and again been roundly disproved.

“Divide and conquer” appears to be the political mantra of our era, with potentially disastrous consequences for us all.

Lebanese Banking Sector ‘Unwilling’ to Reform

On Thursday, June 18, Lebanese financial adviser Henri Chaoul resigned from his role in negotiations with the International Monetary Fund (IMF.) The adviser of the Lebanese Ministry of Finance expressed his exasperation with the Lebanese banking sector.

“I have come to the realization that there is no genuine will to implement either reforms or a restructuring of the banking sector, including the Central Bank,” Chaoul said in a statement.

The adviser accused Lebanese authorities, including politicians, central bank officials, and representatives of the Lebanese banking sector of dismissing the “magnitude” of Lebanese losses and accused all actors of embarking on a “populist agenda,” according to Reuters.

The government of Prime Minister Hassan Diab had introduced a plan based on government projections of losses amounting to $83 billion in the banking sector alone. The plan’s estimations of losses presented the first quantitative diagnosis of Lebanon’s intertwined crises that have led to rapid hyperinflation and rapidly falling living standards for Lebanese people.

Fundamental disagreements

Chaoul and the IMF appear to agree with the magnitude of the losses estimated in the prime minister’s plan, but Chaoul implied that the banking sector, including its central bank and a parliamentarian fact-finding committee, had presented very different numbers, challenging the government’s estimates. The failure of Lebanese officials to agree upon the scale of its losses amounted to a “dismissal” of the true problem, according to the adviser.

The former Lebanese finance minister and current Speaker of Parliament Nabih Berri said that the government estimates had been drawn up in a rushed manner that had led to mistakes and wrong assumptions. He told Lebanese broadcaster MTV that Lebanon would be unable to pay its bond obligations until 2043 as politicians aim to reach a compromise on the true number of losses.

The IMF itself has highlighted that the uncertainty over the true scale of Lebanon’s financial woes is a major stumbling block in the ongoing negotiations, calling for a “joint diagnosis” to establish a transparent diagnosis on which to base its talks.

“Lebanon needs to reach a common understanding of the source and size of its financial losses,” IMF spokesman Gerry Rice stated on the IMF website, calling the issues “complex.”

Reforms

The IMF will only provide support if the Lebanese government is willing to implement broad reforms, which could prove unpopular. “There is a need for comprehensive reforms in many areas, which requires acceptance and consensus from the society as a whole,” Rice stated.

But many fear the IMF will require unpopular neoliberal reforms that aim to cut public spending that could face significant resistance from Lebanon’s increasingly destitute population.

Public resistance to IMF demands for reform is highly likely as the IMF is a proponent of the “Washington consensus” that calls for cutting public spending, shifting taxation onto the poor, liberalization of banking, deregulation, and privatization.

Many countries who have followed IMF reforms have only seen their populations further impoverished as public spending is cut to allow for foreign debt repayments while halting growth and inflation.

US ambitions to weaken the influence of Hezbollah in Lebanon and neighboring Syria have resulted in tough sanctions, the Caesar act, which came into effect on June 17. The sanctions are aimed at Syria but will gravely impact Lebanon, which is one of the few remaining nations to trade with Syria.

The role of the US in further worsening Lebanon’s economic prospects in the midst of its interconnected health, economic, and financial crises has led some to urge the country to find funding from China instead.

Chinese alternative

China has been eager to work with Lebanon, as it sees its ports in Tripoli as an important possible link in its Belt and Road Initiative that aims to connect Europe with China through an ambitious infrastructure project that spans the historic silk route.

Hezbollah’s leader Hassan Nasrallah on June 16 announced that China is ready to invest in Lebanon’s infrastructure.

“Chinese companies are ready to inject money into this country,” Nasrallah stated on Hezbollah’s television network Al-Manar. Nasrallah argued that China would easily match the $10 billion sought from the IMF, with few of the painful reform demands.

While inviting Chinese investment could significantly boost Lebanon’s economic prospects, it would risk the ire of the United States who could apply sanctions to cripple the economy as it is currently doing in Iran and Syria.

Accepting IMF reforms would likely spark further popular unrest, while accepting Chinese investments could trigger a diplomatic conflict with the US. Even if Lebanon had a functional and effective government, the country is left with few good choices to resolve the suffering of its people.