It’s the (Global) Economy, Stupid: Poland, the NBA, and the 2020 Election.
On the surface, three widely divergent stories which featured prominently in the news this week — the NBA’s agonizingly slippery response as to how to respond to a generic tweet from Rockets GM Daryl Morey in support of Hong Kong’s protests, President Trump’s increasingly brazen appeal to racial divisions as an electoral strategy during a Minneapolis speech, and the success of Law and Justice, Poland’s authoritarian populist party in Poland’s parliamentary elections- are wholly unconnected, spanning three different continents and political systems. Under the surface, however, these stories are directly connected and reveal a far deeper truth about the world created by the flow of global capital.
First, Poland. During the Communist era, Poles had a saying: Our is a like a radish- red on the outside only. The West long believed in a romantic notion of an underlying Polish spirit of liberal democratic values, united with the Atlantic community in heart if not in government, straining at the leash of its Soviet masters. After the Solidarity-led fall of Communism in Poland thirty years ago, Western hopes appeared vindicated: the new Polish republic emerged as a successful democracy, building a system of government which appeared to adopt the best of Western style liberalism, separation of powers, and the rule of law.
Yet in 2015, Law and Justice (PiS), a right wing populist movement, achieved power in Poland and moved with incredible speed in dismantling some of the key architecture of post-Communist Poland. Led by the erratic, conspiratorial minded Jaroslaw Kaczyński, PiS has co-opted state television into a personal propaganda network, launched a massive assault on the independence on the Company’s judiciary, weakened the electoral commission’s independence, and restricted free speech. PiS also has chillingly utilized politically motivated prosecutions against political opponents. Lech Walesa, post-Communist Poland’s founding father, was sued for slander and ordered to apologize, an eerie throwback to the Communist Poland’s prosecution of him for the same offense in 1986. PiS’s assault on ordered liberty has led to significant pushback in Poland, but PiS has shown itself adept at advancing proposals, pulling back in some details upon pushback, and then pushing forward thereafter as protests sputter. The election of 2019 appeared to be a bellweather for whether Polish citizens recognized the fool’s gold offered by PiS, and PiS, if nothing else, obliged by making no efforts to hide its aims: it ran explicitly on demonization of the LGBT community as antithetical to Poland’s Catholic faith, completion of its undercutting of judicial independence, and establishment of a regulatory body to oversee journalists.
The author Yascha Mounk, writing in the Atlantic, described Poland’s electorate on the eve of the election in starkly familiar and resonant terms:
There’s the mostly metropolitan Poland of well-educated and affluent optimists who are grateful for the opportunities they have been able to seize since the country emerged from Communism. And then there’s the mostly rural and exurban Poland of those who fear that their traditional way of life is about to disappear, and intuit that the winners of the country’s economic transition have come to look down on them.
By fusing its conspiratorial, anti-Western populist views with cash payments to supporters, in elections this week, PiS won 44% of the parliamentary vote, improving its 2015 margin by 6%. While it did suffer pushback in the Polish Senate, PiS’s mix of anti-democratic efforts to preserve a traditional Polish volk, its hostility to immigration, and its overall goal to “reshape Europe and re-Christianize it”, as the prime minister Mateusz Morawiecki stated, clearly found, and continues to find, resonance with a substantial part of the Polish electorate, most clearly in the rural and exurban strongholds Mounk situated on one side of a growing divide. If democracy was on the ballot in Poland this week, the voters soundly considered the virtues and vices of the republican system, and chose, by plurality, instead the comforts of authoritarian nationalism, repudiating the dreams of embedded liberal values that euphorically emerged from Communism’s sullen ashes just thirty years ago.
Across the world, values may not have been on the ballot, but they were in the boardroom. The words themselves were as anodyne as they were in accordance with American values: Rockets GM Daryl Morey tweeted “Fight for Freedom. Stand with Hong Kong.” Morey isn’t known as an activist: he was simply relaying a long-held American value, standing with anti-government protestors in Hong Kong seeking greater democratization in the Chinese special administrative region. In 1989, when Chinese troops cracked down on protestors in Tiananmen Square, Morey’s words would not have registered as a blip on the radar of either the United States or China.
In 2019, however, they caused an immediate firestorm. Chinese partner companies which streamed and showed NBA games in China suspended those services. CCTV, the state-run TV giant, explicitly rejected American values: “We believe that any speech that challenges national sovereignty and social stability is not within the scope of freedom of speech.” The Chinese consulate general in Houston reported itself “deeply shocked by the erroneous comments” and urged the Rockets to “correct the error,” as if Morey’s personal statement in favor of liberal values was a misfiring widget to be recast in an iron mold.
That China would object to an American’s statement on Chinese freedom or lack thereof is unsurprising, if needlessly antagonistic given Morey’s nongovernmental, apolitical position within an American sports league. But the reactions of Americans affiliated with the NBA were truly eyebrow raising. Morey apologized on Twitter, reportedly after the Rockets considered terminating his employment. Rockets guard James Harden unashamedly stated “We apologize. You know, we love China.” Clippers coach Doc Rivers and Warriors coach Steve Kerr, both outspoken and thoughtful commentators on American domestic politics, bent over backwards to avoid taking a specific position on Moreygate, with Rivers saying “freedom of speech does not mean freedom of consequences” and Kerr stating he needed to educate himself on the situation before commenting. LeBron James, who has no problem blasting Trump as a “bum”, backpedaled as furiously as if defending a fastbreak when confronted with Beijing’s wrath, stating “Just be careful what we tweet, what we say and what we do.” In this, the NBA became just the latest US company, following such entities as the Gap and Marriott, to kowtow when confronted with Chinese nationalism.
Finally, in America today, all roads lead to Trump. Little need be said about the substance of Ukraine-gate, other than this: if the President’s comments on Twitter, in the media, and most recently in a Minneapolis rally suggest anything, it’s that he will respond to the impeachment inquiry by turning up the dial on divisive, racist rhetoric. Speaking in Minnesota in the eye of the political storm, Trump slammed Rep. Ilhan Omar, a Somali-refugee turned Congresswoman as “an America-hating socialist” who “minimized the September 11 terror attack on our homeland…she is a disgrace to our country.” Attacking Omar is not new for the President. But what came next was more explicit. Bathing deeply in the waters of grievance and demographic fear, Trump attacked the entire Somali community in Minnesota, criticizing prior leaders who “ brought large numbers of refugees to your state from Somalia” and pledging that his travel ban and massive reduction in refugee admissions “are keeping terrorists, criminals, and extremists the hell out of our country.”
Suffice it to say the Somali community in Minnesota is not comprised of terrorists, criminals, or extremists. Some 69,000 Somali-Americans, 80% of whom are US citizens, live in Minnesota, where they own and operate some 600 businesses. Trump’s comments, coming just months after his infamous “Send her back” rally, are as appalling as they are unsurprising. As impeachment winds gather, Trump has increasingly leaned into the windstorm by turning up the dial on the racially-charged divisions. He has made it clear that he doesn’t regard the Somali community as inherently American- note the verbiage of “your” state — doesn’t want people like Omar in the country, let alone in Congress, and will increasingly take refuge in the idea that others are now free, via his strongman appeals, to publicly agree with him. Coupled with his re-tweeted warning about “civil war” should be removed, if anything, Trump’s grotesqueries in dividing Americans by immutable characteristics anticipates his likely strategy in 2020.
There is an underlying, subterranean thread linking the three disparate stories, one buckled together by the final demise of the Western dream most prominently endorsed in the post-Communist era by the pungent phrase, coined by Francis Fukuyama: the “End of History.” In this conception, the world’s democracies, bolstered by the powers of unrestrained international capitalism, would spread inexorably into the operating systems of totalitarian nations, and in doing so would install by osmosis both prosperity and the democracy thought to protect it. In the 1990s, while academic researchers debated fiercely as to whether the introduction of globalized capital would democratize the world or merely strengthen authoritarian regimes, a general consensus among policy makers ardently argued for the former. This philosophy held that globalized economics and political liberalization are the inspiration of and resultant consequence of each other. A unified, liberal policy accelerating the flow of Western capital to break down barriers of autarky would necessarily release the benefits of democratic values into the target populations, unifying those populations around the joint benefits of widespread prosperity and greater sunlight in the political sphere. As capitalism and classical liberalism grew together, intertwined and inexorably more potent in the West, so too would the find fertile soil in the rest of the world.
China, of course, was the white whale of the globalization movement. Just a decade after the butchery of Tiananmen Square, a bipartisan consensus of US policymakers demanded China’s ascension to the World Trade Organization. Speaking on March 9, 2000, in support of the bill then pending to admit China to the WTO, then-President Clinton specifically invoked the effect on Chinese political development as a goal worthy of making such a significant economic decision. “Membership in the W.T.O., of course, will not create a free society in China overnight or guarantee that China will play by global rules. But over time, I believe it will move China faster and further in the right direction, and certainly will do that more than rejection would.” The belief was politically universal: speaking on the campaign trail in May, then-Gov. George W. Bush urged passage of the bill, stating directly that “trade with China will promote freedom. Freedom is not easily contained. Once a measure of economic freedom is permitted, a measure of political freedom will follow.”
In 2000, America’s trade deficit with China was $83B; by 2018, the trade deficit had reached $420B. Some 2 million manufacturing and related upstream jobs were lost between 1999 and 2011 as a result of China’s ascension to the WTO. Yet at the same time US businesses were either losing market share to Chinese companies or simply moving their operations to China, many US businesses became dependent not only on China for physical production space but for profit margins. The NBA, which as of 2000 had nominal impact from the Chinese market, now has a $4 billion market in China. Approximately $500 million in annual NBA revenue comes from deals with China. CCTV, China’s state media, broadcasts NBA games to the nation’s 300 million basketball players. NBA players themselves have lucrative interests in the China market, with much of the apparel sold through Nike and Under Armor manufactured in China.
If the liberalization theory was right, China would now be a Jeffersonian paradise instead of the dictatorial giant it remains. Clearly, globalized economics have not universally resulted in the implantation of democratic values. Capitalism needs stability, not democracy, and authoritarian regimes, if handled deftly, can in fact provide short or even medium term stability. The values transmitted by Western capital, moreover, aren’t necessarily democratic values: capital is ruthlessly undemocratic, harnessing itself to the highest attribute of profit margin, not democratization. We’ve known this now for some time.
But now, within NBA-gate, we can see for perhaps the first time that the values transfer may well have worked, simply in the converse method intended. Authoritarian values have seeped into the American bloodstream by the free flow of capital every bit as much as American values were expected to flow outward. We encouraged capital to open foreign markets, and the chickens of such openings have come home to roost. Heavily dependent on such markets, we’re now seeing US businesses squirm and twist to retain access to not only those markets, but the production centers now contained therein which are critical for the supply chain and profit margin. Pushed against the wall of authoritarian intransigence, businesses — and the players themselves are businesses as brands — are all too willing to abandon bedrock American values to keep the doors open. Talking points of foreign autocracies find themselves in the mouths of American capitalists and labor alike: if jobs are threatened by free speech, no less than profit margins, it is free speech that appears to be in the crosshairs. We have looked into the mirror of globalization and only now realize that the mirror was staring back at us, imposing its own logic and values through invisible transfer. Coercion is not needed if we look into our wallets and coerce ourselves. Core U.S. values have been rendered illusory in the funhouse of international economic partnerships. We wanted China to look more like us. Instead, we look more like China.
Nor do the effects of globalization inure in equal measure to the native populations. While globalization of capital has clearly and unmistakably resulted in a dominant productivity premium for capital, it has accomplished no such widespread goal for labor. Thomas Piketty achieved unlikely rock star status with his study of inequality in 2013’s History of Capital in the Twenty-First Century, which adopted as its central thesis the idea that when the rate of return on capital exceeds the general rate of economic growth over an extended period of time, the world economy lurches toward oligarchy, with its attendant social miseries.
PiS’s success in Poland is clarion call to the validity of Piketty’s trenchant observation. No less than in the United States, globalization has elevated specific classes of labor and capital while decimating the social status of others. A 2017 policy paper found that Poland had the highest wage dispersion among the 27 EU member states and income inequality that was “visibly higher in Poland than in the majority of Western European countries.” The large surge in wage dispersion recorded was “ related to the increase in wage premiums for well-educated workers performing highskilled jobs.” In other words, Poland’s move from autarky to integration within the world capital market created opportunities for cosmopolitan, urban, and educated workers at the expense of those for whom Solidarity initially appealed. Corporate taxes are low; the tax system is highly regressive, with a higher burden on lower incomes than higher incomes.
Because the atomizing effects of globalization appear to be unceasing and immutable, those caught on the wrong side of the divide have sought the Samson option, finding their fading strength to pull the temple down on their hated oppressors. PiS’s success teaches us that inequality isn’t purely an economic problem, to be solved via mathematical precision. It’s a social division, a widening schism in which the effects cause different populations to respond very differently, emotionally, culturally, and socially, to the swirl of events around them that seem very much ordained from above. The appeals to nationalism at the expense of the vibrancy of democracy have found enormous resonance with those elements of the population cut off from the expansive buoyancy of global capital’s anointed victors. With the only thing left to them — the vote- -they will paradoxically undercut democracy if it means finding the commonality that is no longer found in the nation-state as a whole. And so, authoritarian populism has found a strong home in the hearts of those who vote for parties like PiS across the world. They cannot find the social capital of unity in the factories or fields anymore, but they can find them in preservation of what they perceive to be left, often centered around religious or racial homogeneity, democratic pluralism be damned. Global capitalism, meant to unify the world, has instead fractured the domestic societies from which it has sprung. PiS’s success is a harbinger of more to come. What has been created in its place are two divergent transnational movements: urban liberals in Warsaw, tied into the global economy, have more in common with their counterparts in other Western metropolises than their own countrymen, and so too the exurban and rural voters who oppose them. Warsaw looks more like Washington, and vice versa, while the PiS voters in the eastern Polish countryside find far more in common with their counterparts in deep Red America.
Meanwhile, economics on a global scale are naturally resistant to solely national solutions. The rise of multinational companies as critical but nimble elements of a national economy has bestowed enormous leverage on such entities to force nation-states to accommodate policies for the implantation of capital and its spillover economic benefits. Writing in 2003, Rafael Reuveny and Quan Li warned on an incipient trend that “governments now try and compete for foreign capital and design their policies to please global investors and firms, who may not act in the best interest of, nor be held accountable to, the voters. It follows that the level of democracy declines.” This is precisely the effect we have seen in the United States. Voter apathy can be traced to many factors, but key amongst them is the ineffectiveness of voting in changing the economic fortunes of average Americans. Through Democratic and Republican administrations and Congresses, despite the bitter partisan food-fights, despite the pledges of sweeping changes mouthed by election seekers, US real wages (i.e. production) for ordinary workers remain slightly below their 1970s peak, even as labor productivity remains strong year-over-year. Two generations of wage earners have come and gone without capturing the increase in the value of their service. The only major change has been the increase in insecurity, as globalized capital has permitted the wholesale movement of production centers both intranationally and internationally on a moment’s notice. Politicians can no longer in good faith ask if you are better off than you were four years ago. Instead, they have sought to exploit the unnatural fault lines slashed into the electorate by the effects of global capital.
No one has done this with greater effect than Donald Trump. And so, unable to run on policies which actually result in widespread economic change, politicians will increasingly be forced to run by tugging at the rips in the social fabric created by the economic modality rendering financial betterment an impossibility in the first place. Trump’s even more blatant attempts to demonize entire populations will become more the norm, not the exception, if delivered in more sophisticated and less staccato bursts. Elections in nations caught in the global capital straitjacket will increasingly become tribal referendums, the economic aspects limited to post-tax adjustments, as PiS has done in Poland, to make cash payments to core supporters, rather than New Deal-style alterations to the entire complexion of national industrial mobilization. If we are no longer all in it together, economically, we will cease to be all in it together politically, as well. From such roots do the poisoned strains of factionalism and quasi-fascism grow.
As these disparate, but ultimately related stories show, we are living in the world made by unrestrained international capital. There is no exit, no fixing, no solution absent addressing the model under which we live, in both its successes and failures. If the demos is to be saved for posterity, a global solution to global capital’s inequity and atomizing nature must be found. Along with climate change, reformist impulses in the global capitalism system are the paramount challenge of our time. In the 1980s, the plain spoken electrician Lech Walesa achieved lasting immortality as the personification of the common laborer’s revolt against Poland’s Communist government, uniting the people under the banner of Solidarity. Today, asked about Poland’s fall from democratic grace, in the same, plainspoken gruff voice, he asserts that national reforms may not be sufficient: “That is why we need global solidarity.” Perhaps the long-term goals of the democratic globalism movement can indeed now only be met by a global movement to reign in the divisive nature of all-out global capitalism. In that, perhaps we will be all in together, once again, but this time on a global scale. Building such a movement may be a utopian dream, but it may also be necessary to preserve what has made our world worth fighting for in the first place.