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PSIR · PALGRAVE STUDIES IN INTERNATIONAL RELATIONS

The Wrecking of
the Liberal World Order

Vittorio Emanuele Parsi

Translated by Malvina Parsi
 Palgrave Studies in International Relations

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 Vittorio Emanuele Parsi

The Wrecking
of the Liberal World
Order
Vittorio Emanuele Parsi
ASERI—Graduate School of Economics and International
Relations, International Relations Università Cattolica del
Sacro Cuore
Milan, Italy

Translated by
Malvina Parsi
Milan, Italy

Palgrave Studies in International Relations

ISBN 978-3-030-72042-1 ISBN 978-3-030-72043-8 (eBook)
https://doi.org/10.1007/978-3-030-72043-8

© The Editor(s) (if applicable) and The Author(s), under exclusive license to Springer
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to Tony (1927–1992) and Piter (1920–2015)
 Acknowledgments

The idea for this book came from a lecture I gave for the Istituto
di Studi Superiori Marittimi (Italian Navy advanced education school)
of Venice in spring 2017, while a Reserve officer for the Italian Navy
as well as professor of international relations. A second version was
published in the Rivista Marittima (Maritime Magazine, in print since
1868). During the 2017 training campaign of the Italian Navy training
ship Amerigo Vespucci—ninety-four unforgettable days of sailing from
Montreal to Livorno, where I had the privilege and the honor to partic-
ipate as commander and political advisor—I tended to its revision and
expansion. This was my last shipboard, after the Italian Navy destroyer
Caio Dulio (D 554) and frigate Carlo Bergamini(F 590), and my last
assignment after two service rounds at Unifil in Lebanon and Operazione
Mare Sicuro. I am finishing my naval career where that of my colleague-
officers begins. I am profoundly grateful to the Italian Navy for the oppor-
tunities they have offered me these past few years, and to the people I had
the chance to meet and appreciate: officers, chiefs, NCOs, leading seamen,
and seamen. This book is dedicated to all of them and to the cadets of
the course Dunatos at the Naval Academy of Livorno; men and women
who chose a difficult life, unique, but full of sacrifice. Among all of them,
I acknowledge especially my colleagues of the Sixth course of the Selected
Reserve of the Italian Navy.
As always, this book was possible thanks to the intellectual and civil
stimulus I get from my daily teaching activities. For this, I have to thank

vii
viii ACKNOWLEDGMENTS

my students of UCSC,1 ASERI,2 and USI.3 Special thanks go to Damiano

Palano, political philosopher of UCSC, Director of the Department of
Political Science, but most of all a precious, acute, and sensible friend who
nudged me out of my natural laziness and gave me the idea of making a
book from the original article. I also owe a debt of gratitude to my dear
friend and excellent colleague at the University of Milan, Nicola Pasini;
my brilliant student and now colleague at Leiden University, Marina
Calculli; and again, Damiano Palano, for sharing their suggestions, objec-
tions, and doubts on the first draft of the manuscript. The book’s theses
were discussed during a seminar held at the Società per lo Studio della
Democrazia (Society for the Study of Democracy), where they have bene-
fitted from the suggestions, critiques, and requests for clarification raised
during a debate made richer by the interdisciplinarity of the audience.
I have tried to profit from the views and critiques of every reader and
discussant, and to answer all their questions. I must also thank my young
colleague Antonio Zotti for the enlightening confrontation on European
matters. A special mention goes to my dear compare, Ambassador (retired)
Paolo Janni, passed away in 2020, and to his wife Francesca, whose advice
has guided me for the last fifteen years. And finally, thank you, from the
bottom of my heart, to all the people who have supported me with their
love for all these years—first and foremost Fiorenza, Teresita, Malvina,
Lavinia, and Costanza—and who keep supporting me, wherever they are.
What I have been able to give back is surely less than what I have received
from them, and I can never forget their generosity.
In the realization of this English edition, which is also a drasti-
cally updated and revised edition in many aspects, I was greatly helped
by the support, encouragement, and advice of many fellow scholars who
have offered me inspiration and friendship for so many years. John Iken-
berry, Mick Cox, Matthew Evangelista, Joe Grieco, and Michael Mastan-
duno shared their precious insights, allowing me to resolve many doubts
and ambiguities in the English manuscript. Without their encourage-
ment and effort, this edition would have never come to life. I must also
thank Mehram Kamrava for actively encouraging me to pursue an English

1 Università Cattolica del Sacro Cuore (Catholic University of the Sacred Heart).
2 Alta scuola di Economia e Relazioni Internazionali (Graduate School of Economics
and International Relations).
3 Università della Svizzera Italiana (University of Italian Switzerland).
 ACKNOWLEDGMENTS ix

edition, as well as his staff, for their priceless editing work. Special thanks,
from the bottom of my heart, goes to my Malvina Parsi, who patiently
carried the burden of translating my anything but simple prose. And I
also thank the anonymous referees of Palgrave-Macmillan for their useful
critiques, which I hope I have fully addressed. A special mention goes to
a couple of young colleagues and friends who have immensely helped me,
and not only in a material way, in meeting the deadline. Antonio Zotti
shared with me his precious time in ameliorating and updating the book,
giving me fantastic support. Valerio Alfonso Bruno put his tireless and
efficient enthusiasm in solving a multitude of problems. It is thanks to
their critical contribution that this book, three years after its first Italian
edition, has finally got its chance at a second life in English. However,
all the mistakes and omissions the volume should contain are my sole
responsibility.
As for everything I have done, will do, or have failed to do, these pages
have been written with a constant thought for my beloved daughters
Malvina, Lavinia, and Costanza—the guiding stars of my roaming exis-
tence. I hope they will serve to remind them and cause them to believe,
that a better world is always possible, and that a big part of our destiny—
the only part we can influence—is in our hands. For in order to change
the world, we must first acknowledge reality for what it is—and keep in
mind that in life, as in rugby, every match, even the most unequal and
complicated, has to be played to the end—and, most of all, know that
there is no alternative in taking the field and trying our best to win, so
that we can earn our own respect, even more than that of the opponent.
Nave Amerigo Vespucci, aboard
Northern Atlantic Ocean
June 22/September 23, 2017
Nautical Miles traveled: 6.885
Hours of motion: 1.337
 Praise for The Wrecking of the
Liberal World Order

“In this tour de force, Vittorio Parsi offers a sweeping and penetrating
account of the rise and fall of the modern liberal international order,
emphasizing its unique and historical contingent emergence on the world
stage and its complex and often conflicting internal principles and logics.
Elegant, erudite, and insightful, Parsi chronicles the stormy voyage of the
Western democracies as they search for calmer seas and gentler winds.”
—G. John Ikenberry, Albert G. Milbank Professor of Politics and
International Affairs at Princeton University, USA

“Vittorio Parsi, one of Italy’s leading scholars of international politics,

has produced an important contribution to the ongoing debate over the
postwar liberal order, what went wrong with it, and whether it might be
restored. Parsi’s insights will be of great benefit to professional scholars,
students, and policy officials on both sides of the Atlantic.”
—Michael Mastanduno, Nelson A. Rockefeller Professor of Government at
Dartmouth College, USA

“One of Europe’s most original thinkers offers a penetrating assessment

of the Liberal World Order and its prospects. Recognizing the challenges
posed by Russia and China, by terrorism and migration, Vittorio Parsi
nonetheless pinpoints the main source of decline in economic and polit-
ical inequality at home and the pursuit of neoliberal policies of glob-
alization abroad. A stable international order will only be possible, he

xi
xii PRAISE FOR THE WRECKING OF THE LIBERAL WORLD ORDER

argues, if governments attend to human needs, pursue economic justice,

and reestablish a social compact to regain their citizens’ trust.”
—Matthew Evangelista, President White Professor of History and Political
Science, Cornell University, USA

“Parsi has written a book of tremendous importance. In concise, persua-

sive arguments, he outlines the reasons for the steady but certain decline
of the liberal world order, and what its next iteration is beginning to look
like. For anyone interested in a serious examination of the emerging world
order, post-Trump and post-COVID, The Wrecking of the Liberal World
Order is a must read.”
—Mehran Kamrava, Author of A Concise History of Revolution,
Professor of Government, Georgetown University Qatar

“Vittorio Parsi’s The Wrecking of the Liberal World Order is exactly

the right book for anyone—student, teacher, news reporter, or policy-
maker—who wants to understand how our domestic and global poli-
tics and economics came to such a sorry state, and what we can do to
build a better future. Parsi combines political acuity with historical insight
to show us how in recent decades the major liberal democratic coun-
tries lost their way, failing in particular to maintain a healthy balance
between market capitalism and welfare-states policies aimed at amelio-
rating market-generated social inequality. Parsi is unflinching it laying
out challenges to the restoration of a more humane liberal world order,
including the rise of China, global terrorism, and Trump-style transac-
tional populism. Yet, he also offers us a pragmatic program for polit-
ical renewal, one that calls for a rebalancing of power between markets
and welfare within and between countries, a reinvigorated common
front among the democracies, and among those democracies a forthright
acknowledgement not just of their common interests but their common
values as well.”
—Joseph M. Grieco, Professor of Political Science at Duke University,
USA
 Contents

1 The Liberal Order and the Broken Pact Between

Democracy and Market 1

Part I Out of Route

2 Titanic, or the Unsinkable Order: Origins, Expansion,
and Betrayal of the Liberal World Order (1945–2000) 29
3 The Broken Promises That Hijacked the Liberal World
Order: A Safer, Fairer, and Richer World 53

Part II The Four Sides of the Iceberg

4 The Decline of American Leadership and the Rise
of Chinese and Russian Authoritarian Powers 83
5 The Molecularization of Threat: Jihadist Terrorism,
Islamist Radicalization, and the Mediterranean Tragedy 131
6 The Drift of Trump’s America in the Liberal World
Order: From Reluctant Rule-Maker to Revisionist
Power 159
7 The Occultation of the People: How Sovereignist
Populism, Stateless Actors, and Technocratic
Oligarchies Have Taken on Boarding Democracies 197

xiii
xiv CONTENTS

Part III A Northwest Passage

8 Changes at the Helm After the Crash? Transitions
Within the Liberal World Order and the Challenges
for Europe 215
9 Conclusions. The Neoliberal Global Order
and COVID-19: Which Way Ahead? 241

Bibliography 267
Index of Names 313
Index of Concepts 317
 About the Author

Vittorio Emanuele Parsi is Professor of International Relations at the

Università Cattolica del Sacro Cuore, Milan (Italy) and Director of the
Graduate School of Economics and International Relations (ASERI),
Milan (Italy). He is Lecturer at the Faculty of Economics of the Univer-
sità della Svizzera Italiana (USI) in Lugano. Parsi has also been Chair
of the Italian Standing Group of International Relations since 2014 to
2020. He is a member of the LSE IDEAS Advisory Board (Center
for Diplomacy and Strategy at the London School of Economics). His
main research areas concern transatlantic relations, security policies in
the Middle East and the Mediterranean, and the relationship between
politics and economics in the transformation of the global system. Parsi
is currently a columnist for Rome’s Il Messaggero. Parsi is part of the
Italian Navy Reserve with the rank of Commander and has joined several
peacekeeping missions in the Middle East and search and rescue (SAR)
missions in the Mediterranean. Among his numerous publications are
La fine dell’uguaglianza: Come la crisi economica sta distruggendo il
primo valore della nostra democrazia (Mondadori, 2012), The Inevitable
Alliance. Europe and the United States Beyond Iraq (Palgrave Macmillan,
2006), and Partners or Rivals? European–American Relations After Iraq
(Vita e Pensiero, 2005), with Matthew Evangelista (Eds.).

xv
 CHAPTER 1

The Liberal Order and the Broken Pact

Between Democracy and Market

A Diverted Order
After decades of stormy conditions, increasingly evident structures fail-
ures, poor steering of the ship—and a good measure of sabotaging and
attempted mutinies—the Liberal World Order seems to have gone off
course for good. The ominous screeches coming from the vessel’ plating
resonate with a sarcastic tone if one comes to think that, thirty-two years
or so ago, liberal democracy had been declared the ‘common ideolog-
ical heritage of mankind’ (Fukuyama 1989), the only viable political and
economic model, legitimized by a sounding victory over every significant
ideological alternative. Nowadays, contesting Francis Fukuyama’s argu-
ment about post-Cold War ‘end of history’ is pretty much like shooting
a fish in a barrel. Since the famous article was published on The National
Interest, at every bad turn of the liberal project, a number of observers
and scholars have been ready to point out how diehard history was
refuting the thesis—indeed, frequently using it as a mere straw man
argument.
Later in the chapter, we will see that Fukuyama’s line of reasoning
may be still more relevant than its trivialized version suggests. Regard-
less, today’s Liberal World Order can hardly be regarded as the world’s
unquestioned political and economic layout. Open trade is resisted not
only by tariffs and new forms of protectionism and mercantilism, but

© The Author(s), under exclusive license to Springer Nature 1

Switzerland AG 2021
V. E. Parsi, The Wrecking of the Liberal World Order,
Palgrave Studies in International Relations,
https://doi.org/10.1007/978-3-030-72043-8_1
2 V. E. PARSI

also by the crisis of multilateralism in international trade governance

(Helleiner 2019; Tao and Woo 2018; MacIsaac and Duclos 2020).
Big business keeps benefiting from governments’ enduring reluctance
to impinge on the exemptions and privileges accrued from thirty years
of deregulation, generating unprecedented levels of wealth inequality
within countries and oligopolistic trends, especially in the most advanced
sectors of global economy (Bourguignon 2017; Holm 2019; Rupert
2012; Schmidt 1995; Wu 2017). International institutions and regimes
are undermined and shunned, no longer by outcast governments only,
but occasionally also by countries that had traditionally been regarded as
pillars of the organizational structure underlying the international order
(Ikenberry et al. 2018; Peters 2016; Smith 2019). Moreover, increasingly
large sectors of Western countries’ population have been growing weary
if not skeptical of liberal institutions and principles, impairing the legiti-
macy as well as the actual functioning of the delicate mechanism balancing
out open markets and representative democracy. This mechanism might
be about to receive its clipping blow by the progressive decline of that
‘middle class’ that had served as the social linchpin of liberally informed
political and economic systems at both the domestic and international
level (Colomer and Beale 2020; Eichengreen and Leblang 2008; Jahn
2018; Näsström 2003; Tormey 2014).
We maintain that this array of challenges affecting contemporary
democracies and the international order that has been underpinning them
over the last seventy years come down to a twofold crisis. On the one
hand, liberal democracies are confronted with the rise of neo-populist
movements. On the other hand, they have been proving increasingly inca-
pable of coordinating among themselves at the international level. These
are two sides of the same coin, and indeed intimately interrelated. In fact,
neo-populist actors are not only dismissive of the global values, norms,
and practices that have been established after 1945, but they are actively
engaged in breaking them down in the name of ‘sovereignty’ (Blühdorn
and Butzlaff 2019). All this is accelerating the crisis of the ‘Liberal World
Order’, which is the focus of this book.
Shifting the blame onto patently illiberal forces might be a handy expe-
dient. It would be far too convenient to underplay this crisis by portraying
it as a manifestation of the repeatedly prophesized ‘decline of the West’
(Spengler 2007), in turn becoming a function of the geographical redis-
tribution of political, economic, and technological power at the global
level. If this were the case, it would be futile to fret over the search for
 1 THE LIBERAL ORDER … 3

an impossible remedy. We might as well refrain from playing a role in a

world designed by others, around values that are distant from both ‘liber-
alism’ and ‘social democracy’—the two overarching political cultures that
have concurred, not without friction and tension, to shape the world in
the twentieth century.
What is more, it would exempt us from the difficulty of understanding
whether or not the causes of this crisis are to be found within liberal
democracies themselves. In the former case, the possibility of reviving the
Liberal World Order and recovering democracies would depend mostly
on liberals themselves: not only on their ability to reform existing institu-
tions, but also to revamp the very ideas which contributed to the triumph
of both democracy at the internal level and cooperation and multilater-
alism at the global one. In the latter narrative, the transformation of the
balance of power between old and new—or resurgent—forces, as well as
the inevitable decline of Western hegemony, may be convenient discourses
to preclude reactions and changes in direction.
The decline of the Liberal World Order is indeed a more complex
story. It is inherently dependent on the domestic transformation of liberal-
democratic states in one peculiar way. The argument that I advance in this
book is that the crisis of the Liberal World Order results from the break-
down of the balance between democracy and market-based economy.
This balance was indeed the premise over which liberal democracies and
the Liberal World Order were built. The collapse of the ‘social pact’ and
the balance between capital and labor, which the welfare state—both in its
American liberal version and its European social-democratic version—was
able to materialize the inner contradictions of capitalism. As a result—I
claim—a novel illiberal political project is emerging and is accommodated
within democratic institutions (Crouch 2020: 48).1
My thesis is that, since the 1980s, the Liberal World Order has been
gradually replaced by the ‘Neoliberal Global Order’. The vessel on which
the West had been travelling since the end of World War II has been
diverted from its original route. On this new and more dangerous course,

1 In particular Crouch (2020: 48) states: ‘“Capitalists”’ preferred regime is post-

democracy, where all the forms of democracy continue, including importantly the rule
of law’, in fact ‘Post-democratic capitalism does not require a formal renunciation of
democracy, any more than corporate neoliberalism requires a renunciation of the market;
indeed, democracy and the market continue to be used together as the primary legiti-
mation of the evolving political system of dominant corporate power, because this latter
lacks any legitimation of its own’.
4 V. E. PARSI

an iceberg stands out. Each of its four sides is capable, on its own,
of sinking our ‘Titanic’. They are the crisis of the American leadership
combined with the rise of authoritarian powers Russia and China; the
molecularization of the threat linked to Jihadist terrorism; the revisionism
of the United States; and the weariness of democracy, pressed between
populism and technocracy. In the background lies the European crisis.
Europe can still be saved, and it can provide a decisive contribution to
the reestablishment of the original route, if it will be able to rebalance the
distinct dimensions of growth and solidarity, making the surveillance and
defense of its borders a shared responsibility and showing its own capacity
on transforming the COVID-19 crisis in an opportunity to relaunch its
role, as it is trying to do with the ‘Next Generation Future’ program,
that—if successful—will be a practical example of what means harmo-
nizing the sovereignty of the different member states within the common
project of the Union.2
The ascendancy of the Neoliberal Global Order enabled and made
increasingly popular the attacks on the firstborn Liberal World Order both
within the academia and—with much more treacherous effects—in the
realm of politics. Unquestionably, the distinction between the two spheres
must always be kept in mind, yet the two have to be equally addressed,
as the Liberal World Order has in fact always been twofold in nature:
on the one hand, it was the particular international order configuration
that resulted from the interactions of an array of structural factors and
actor-level contingencies in a post-World War II context characterized
by the US hegemony (Keohane 1984: 34);3 on the other hand, it was
a distinct political project designed to keep together as harmoniously as
possible state sovereignty—in its liberal-democratic version—and market
economy—entailing free trade on the international level. Those just
mentioned are specific understandings of three concepts—‘international
order’, ‘sovereignty’, and ‘market economy’—that have characterized the
zenith of political modernity.

2 Conclusions of the Special meeting of the European Council (17–21 July 2020).
Available at https://www.consilium.europa.eu/en/press/press-releases/2020/07/21/eur
opean-council-conclusions-17-21-july-2020/.
3 According to Keohane’s definition (1984: 34), the concept of hegemony: ‘is defined as
a situation in which one state is powerful enough to maintain the essential rules governing
interstate relations and willing to do so’.
 1 THE LIBERAL ORDER … 5

Liberalism accepted the challenge of integrating them—i.e., making

them not only compatible but also synergic. In the long-term period,
though, liberalism has scaled down its goal—especially with regards to its
political and institutional aspects—and settled for harmonizing them by
couples only, rather than in one triad. The emergence of this sub-optimal
arrangement can be effectively regarded as resulting from the resistance
to change typical of the kind of international society outlined by Hedley
Bull, one in which—at least in its original version—states highly protec-
tive of their sovereignty establish common practices and institutions in
order to manage anarchy (Bull 1977).4 Only later the drive would incre-
mentally emerge toward a reform of the states’ political and economic
institutions aimed at achieving higher levels of inclusiveness—even at
the cost of less control and greater international interdependence. This
ambition resulted in clashes among sovereign countries that would even-
tually degenerate into World War I, which in turn led to the end of the
European international society.
Over two decades ago, Ian Clark observed that it was no accident that
the first globalization—the one that drew to a close in 1914—came to a
head due to the inconsistencies between the states’ internal and external
needs and priorities. ‘The paradoxes of the age are thus to be accounted
for by the complex interplay of the two dialectical process—between an
open and close international system, on the one hand, and between the
old and the new social orders, on the other. It was the attempt to solve the
problems of the latter by the enhancement of state power, and through
the modality of the new nationalism, that tipped the scales of the former
away from open internationalism and toward destructive fragmentation.
The very globalization that had hitherto represented the extension of state
power had come to be regarded as a threat to its base of domestic control.
It was through the medium of changing state practice that the new mood
of international relations was to find its expression: the need for domestic
accommodation reduced the scope for international concessions on the
key issues affecting the external standing of the states’ (Clark 1997: 50–
51).
An analogous outcome seems likely to occur in the present circum-
stances, as domestic pressures resulting from increasing inequalities
generated by hyper-globalization and the acceleration of technological

4 Particularly, on the role between order and international society see (Bull 1977: 22–
50), and on how order is maintained in world politics see (Bull 1977: 62–73).
6 V. E. PARSI

advancements prompt states to raise barriers among them and take

on aggressive foreign policy attitudes. This is a trend we can observe
across the entire international community, and mainly in the behavior
of major powers, which increasingly act as they no longer belonged to
a common ‘World International Society’. In the United States, Donald
Trump wreaked havoc on liberal internationalism, treating allies and part-
ners almost like rivals, advancing the notion that the goal of making
America ‘Great Again!’ could only be achieved at the expense of the
rest of the world—not by assuming leadership responsibilities for it. In
doing so, the Trump administration has exacerbated the ever-present
tension between the United States as a liberal hegemon—responsible
for preserving and providing for global governance—and the United
States as a great power—whose priority is the pursuit of its own national
interest (Ikenberry 2011: 298–299).5 Caught up in his own transac-
tional mindset, Trump has seemingly forgotten that US power has largely
depended on the country’s relations with its allies and its leadership
skills; it comes therefore as no surprise that his approach to international
affairs has actually made America ‘Alone Again’. Paradoxically enough,
while the United States was abdicating to its traditional role of leader,
President Xi of China became the champion of globalization limited to
free trade and business, unencumbered by political liberalism (Arrighi
2009).6 In this sense, the material facilities provided by the Belt and
Road Initiative—serving as a source of unparalleled structural power for
the Chinese government—supplant to a great extent the Liberal World
Order’s ideological infrastructure (Gabusi 2020). Drawing on its newly
acquired status, China has been fanning the flames of nationalism with its
bellicose recriminations against neighboring countries, tightening its grip

5 Ikenberry (2011: 298–299) notes: ‘The United States is unique in that it is simulta-
neously both a provider of global governance—through what has tended in the past to
be the exercise of liberal hegemony—and it is a great power that pursues its own national
interest’, and shortly after ‘When it acts as a liberal hegemon, it is seeking to lead or
manage the global system of rules and institutions; when it acting as a nationalist great
power, it is seeking to respond to domestic interests and its relative power position. The
danger today is that these two roles—liberal hegemon and traditional great power—have
been in increasing conflict. The grand bargain that sustained liberal hegemonic order is
in danger of unraveling, exposing the old tensions and contradiction buried within’.
6 In the postscript to the 2nd edition of The Long Twentieth Century, Arrighi observed
that, while the possibility of a universal empire ruled by the West still existed, it was much
more likely the possibility of global market society based on Eastern Asia.
 1 THE LIBERAL ORDER … 7

on Hong Kong, determined to put a definitive end to the ‘one country,

two systems’ principle, showing growing impatience with regards to the
issue of Taiwan, and locking up as much as a million Uyghur citizens in re-
education camps. Russia also played the nationalistic card in the annexing
of Crimea and has sought to compensate for its growing internal diffi-
culties—connected with the plunging profits on its oil and gas exports
and the repercussions of Western sanctions—with a more assertive foreign
policy, especially in the Mediterranean region (Sakwa 2020). The nation-
alistic trend, however, has not been restricted to the illiberal world. Even
the United Kingdom—at the heart of the Liberal World Order since its
inception—has been affected by nostalgia for its glorious imperial past.
Beyond evidencing a widespread callousness about the most problem-
atic legacies of imperialism and colonialism, such nostalgia has bolstered
the Brexiteers’ argument and Boris Johnson’s bid for the premiership
(Campanella and Dassù 2019).
Even though present-day globalization seems unlikely to implode in
an open conflict among great powers, like in 1914, fears for future
growing tensions between states and within them are hardly unreason-
able (Macmillan 2013; 2020: 22).7 A major ‘constitutive war’ that gives
rise to a new global hegemony—possibly a Chinese one—may well be
improbable (Allison 2017), also because we still live in a nuclear age
(Gilpin 1981; Modelski 1979, also Kugler and Organski 1980). Never-
theless, in the past, quite a few great wars—including the one referred
to by Ian Clark—have been triggered by misperceptions, errors of judg-
ment, undesired escalations (Jervis 1976; Clark 2013). The one thing
that the COVID-19 pandemic should have taught us is that inconceiv-
able events—the famed ‘black swans’—are just occurrences that have not
been given enough thought.
As brilliantly and subtilty argued by John Ikenberry in his last work—A
World Safe for Democracy—it was liberal internationalism that took up the
challenge I am dealing with in this book: harmonizing the international

7 About the prospects of the current international order, with reference to the Trump
administration’s reckless conduct, Macmillan (2020: 22) points out that ‘Norms that once
seemed inviolable, including those against aggression and conquest, have been breached.
Russia sized Crimea by force in 2014, and the Trump administration last year gave the
United States’ blessing to Israel’s de facto annexation of the Golan Heights and may well
recognize the threatened annexation of large parts of the West Bank that Israel conquered
in 1967. Will others follow the example set by Russia and Israel, as happened in the 1910s
and the 1930s?’.
8 V. E. PARSI

order with the viability of sovereignty and of market economy. Liberal

internationalism did so by acting not only as ‘a set of ideas about how
the world works’ but also ‘as a set of ideas and projects’ for managing the
world of liberal democracies, seeking ‘to organize and reform the interna-
tional order in ways that strengthen and facilitate liberal security, welfare,
and progress’ (Ikenberry 2020: 7). Liberal internationalism was—and still
is, according to Ikenberry—not only an analytical approach, but a polit-
ical project, ‘deeply connected to progressive political movements. Its
greatest moments have come when its international agenda was defined
in ways that strengthened the ability of national governments to carry
out progressive socioeconomic goals. In these instances, the building
of international rules, institutions, and partnerships has been designed
to strengthen—not undermine—the capacities of national governments’
(Ikenberry 2020: 9–10).8 In line with the theoretical premises of liber-
alism, this book puts emphasis on the actions of states, (trans)national
collectivities and individuals, whose agendas are going to be regarded
as essential to determine how, and to what extent, structural factors—
operating at the inter- and trans-national level, as well as within each
state—do shape and trigger change within the international order. Far
from adhering to an idealistic approach, the investigation emphasizes the
relations between interests and values informing the agendas of states and
non-state actors—relations which are established in a deliberate yet struc-
turally constrained manner. The preference for a Liberal World Order will
not be grounded—at least not systematically—on moral considerations,
but rather based on the hypothesis that liberalism still provides the most
adequate analytical premises to account for the unprecedented interna-
tional and domestic stability cum flexibility experienced since the end of
War World II. It is such ‘liberal stability’ that has led to the establishment
of authentic international leadership, while limiting the effects of uneven
power distribution. But these very same premises, the book argues, have
also enabled—yet not in an inescapable manner—forces which are bound
to destruct the Liberal World Order itself.

8 The scholarly debate concerning the Liberal World Order, its critics and supporters,
is immense and cannot be effectively summarized here. The recent work by G. John.
Ikenberry, A World Safe for Democracy (Ikenberry 2020) serves as an excellent source
on the history and perspectives of the liberal internationalism. See also Kundnani (2017)
and Smith (2019). For a realist assessment of the notion, see at least the recent works by
Mearsheimer (2018, 2019) and Allison (2018).
 1 THE LIBERAL ORDER … 9

As a start, we need to acknowledge that a Neoliberal Global Order has

been replacing the Liberal World Order, since the end of the Cold War,
generating disrupting effects on the balance between values and interests,
democracy and market. The main aim of the book is then to reveal and
expose the nefarious mechanisms of such ‘replacement’, and set the intel-
lectual premises to revive and restore the Liberal World Order. To achieve
this goal, the book develops along three axes, each addressing a specific
tension: between the domestic and the international dimensions; between
the political and the economic realms; between values and interests.
But this is also related to the variety of forces that have been under-
mining the Liberal Word Order since the final decades of the Cold War:
the technocratic forces that push for homologized international responses
to economic-financial crises, thus undermining the social role of the
state in domestic politics; the sovereigntist–populist forces that weaponize
sovereignty against international cooperation; the authoritarian powers,
like China, that seek to create a new international order deprived of liberal
norms.
Oddly enough, all these forces take little account of the relation
between interests and values, as if there was nothing to argue for or
against it, as though the question could be reduced to a mere choice
of what to stand for—or what to succumb to. Conversely, one of the
main points underlying this book is that values—which can only become
‘common’ as a result of passionate argumentations, not just random,
unreasoned picking—are a feasible point of reference around which the
fragmented and dispersed interests of the many—which are weaker as
long as they remain divided—can coalesce and possibly prevail over the
concentrated, ‘inherently’ stronger interests of the few.9

9 A large number of scholars have been arguing how difficult is to ‘fix’ the Liberal
World Order and its unmaking. See, for instance, the following contributes, appeared
recently on Foreign Affairs: Colgan and Keohane (2017), Haass (2020) and Cooley and
Nexon (2020). According to Porter (2020) the Liberal World Order has always been an
idealized narrative based on coercion and illiberalism, rather than benign US leadership
and institutionalized multilateralism. Economists such as Milanovic (2020) and Mazzucato
(2020) have been focusing on necessity, and the capacity, to rewrite the rules of the game
governing capitalism to reform the Liberal World Order.
10 V. E. PARSI

The Pillars of the Liberal World Order

The Liberal World Order is the particular shape that US hegemony
assumed after 1945, inside a political project which recalled the Wilso-
nian principles and the entire tradition of liberal thought (Hathaway and
Shapiro 2017). While the immediate goal was to create an international
arena ruled not only by force but rather by law, the final goal was to shape
the international system as a domestic democratic system. In some way,
this entailed protecting the domestic social orders from the disrupting
influences coming from the international arena—with war being of course
the most disrupting (Ikenberry 2001).
The Liberal World Order was a simple and brilliant structure founded
on an idea based on five pillars:

1. Building a free, open international market to contain the excesses

of sovereignty and the logic of international anarchy;
2. Using states’ sovereignty to check and balance the excesses of the
market;
3. Erecting a rich, solid architecture of international institutions to
make the cooperation between states possible, reducing the secu-
rity dilemma and channeling the force of market and force of states’
sovereignty, making their cooperation possible and profitable;
4. Including politically, economically, and culturally the lower classes—
the masses—to make ‘popular’, and thus reinforce, the liberal
institutions of market economy and representative democracy;
5. Creating a strong, sizeable middle class, premised to be the back-
bone of the domestic political and economic systems.

The main characteristics of the Liberal World Order—already sketched

by Woodrow Wilson at the end of World War I, but fully defined by
Franklin Delano Roosevelt and Winston Churchill during World War
II—constituted a compromise between political realism and the transfor-
mational aspirations of liberalism. On the one hand, this order was based
on the acknowledgment of the necessity of sovereignty. On the other, it
used the diffusion of free market not only as a way to achieve welfare and
wealth in the economic realm, but also as a barrier to contain the logic of
sovereignty and its consequences in developing international cooperation.
The market was seen as an effective tool to control international anarchy
 1 THE LIBERAL ORDER … 11

and the frequent resort to war, that was always accessible to the sovereign
states.
The idea was ‘liberal’ in its most classical meaning. Expanding the
international dimension of economic exchanges and economic interde-
pendence could be achieved only by making their interruption extremely
costly, if not unaffordable. This logic would have reduced the tempta-
tion of war while increasing the appeal of peace as a way of strengthening
and expanding international commerce. In a world that, in the span of a
quarter-century, had known the tragedy of two world wars, the idea of
using the market, its logic, and its power, to tame the ‘wild’ dimension
of state sovereignty seemed, and was, a strategy for success.
The 1929 economic crisis, with its protracted, devastating conse-
quences, and the strategies put in place to solve it, had clearly revealed
that markets—and especially financial markets—are not capable of self-
regulation. In other words, the crisis had revealed the illusion of the
‘invisible hand’ (Polanyi 2001). It clearly showed that market imbalances
can have a disastrous effect, well beyond the mere economic realm. They
can in fact invade every social field: this was the American lesson in the
1930s. In addition, a disrupted market can even deluge the institutions
of democracy, as the collapse of the Weimar Republic and the rise of
Nazism in Germany well exposed (Fritzsche 2008: chapt. 1; Kerschaw
2015: chapt. 5). During the interwar period, a clear axiom emerged:
only the creation of a solid middle class—through the improvement of
the conditions and well-being of a great portion of the working class,
their inclusion in the circuit of welfare, consumption, and affluence—
can constitute ‘the people’, the ‘historical subject’ that liberals needed
to establish democracy (Wiebe 1995: 275).10 Relatedly, the appeal of
liberal political culture became the core element of the democratic system
itself. Of course, the incubation of liberal democracy preceded the end
of WWII. For instance, the expansion of the rights of citizenship—i.e.,
the universal manhood suffrage—had been an achievement of the early
1900s. Yet, political inclusion would have had no concrete meaning
without social inclusion. Its symbolic value had been in fact vilified by
the rampant economic and social inequality. Not surprisingly, the ‘new
citizens’ became an easy prey of the demagogues who capitalized on

10 The people who according to Wiebe (1995) have been dissolved during the Gilded
Age (in particular: chapter 7, Dissolving the People, pp. 162–180).
12 V. E. PARSI

the disturbing disconnect between the ‘promises’ and the ‘premises’ of

democracy.
It is beyond doubt that the Cold War, while limiting the universalistic
ambitions of the liberal model founded on the alliance between democ-
racy and market economy, caused structural pressure on it. The competing
appeal of capitalism and socialism shaped the interpretation of how liberal
democracies should function: a consensus emerged among liberals that
the forces of the market had to be reconciled with the welfare state. To
put it otherwise, liberal democracy in the West not only triumphed during
the Cold War, but actually thanks to it. More specifically, socialism funda-
mentally contributed to shaping the normative interpretation of the liberal
democratic state, although its contribution is often denied. It is then not
surprising that the end of the Cold War marked a tremendous U-turn,
favoring the triumph of a different interpretation of liberalism.

The Great Discontinuity: From the “Liberal

Triangle” to Rodrik’s Trilemma
The inversion began during the 1970s, even if, actually, things started
to change between the end of the 60s and the beginning of the 70s,
due to some facts that produced the project of the Neoliberal Global
Order and that allowed the new one to progressively replace the orig-
inal Liberal World Order. The crucial turning point came in the few years
between 1968 and 1973. In those years, Western democratic societies
were put under significant pressure and the pillars of the Liberal World
Order were shacked, among others, by student radicalism, a significant
average increase in salaries, the first symptoms of a generalized down-
turn in production, the consolidation of the London City’s Eurodollars
market, the explosion of the US commercial deficit and federal debt,
America’s defeat in the Vietnam War and the fatigue of Keynesian poli-
cies in coping with the unprecedented joint occurrence of high inflation
and high unemployment (Piketty 2020).11 Moreover, the end of Bretton

11 Curiously, when Piketty (2020) examines the transition from cultural and political
hegemony of liberals—the Social-Democratic Transformation 1945–1980—to the conser-
vatives’ and neoliberals’—the New Age of Propertarianism 1980–Present—he does not
seem to draw much attention to aspects such as stagflation, the animosity against ‘big
government’, workers’ strikes, students revolts and civil rights protests, which can all be
regarded as signs of the upcoming change.
 1 THE LIBERAL ORDER … 13

Woods and the oil shock also came about, with the dramatic increase
in the amount of US dollars—i.e., the so-called Petrodollars—detained
abroad, effectively out of the Federal Reserve and the US political author-
ities’ control. This decade witnessed the emergence of distinctive cultural
trends, which later enabled the ideological contestation of the welfare
state and embedded liberalism—the neoconservative revolution—and the
economic crisis following the 1973 oil shock that was overcome by
placing its burden mainly on the workforce (O’Connor 1973). The
deconstruction of social need for the welfare state, and the very logic of
consensus underlying it, began to gain cultural hegemony and to become
increasingly embedded in economic and political relations, both nationally
and internationally. The onset of globalization was symbolically accompa-
nied by the collapse of the Soviet Union, which also brought down its
alternative, expensive, and illiberal model of modernization.
It was at this point that the ‘great discontinuity’ began, together with
the shift from the Liberal World Order to the Neoliberal Global Order,
marked by the torpedoing of the ‘great bargaining between capital and
labor’ (Reich 2010) that had shaped post-WWII domestic and interna-
tional orders, and it was at this same point that so-called ‘deregulation’
gained its momentum as a general approach to the relationships between
democracy and market, and as a tool designed to create a transnational,
self-regulated, unbridled financial market. And it was here that the inver-
sion from the original logic of the Liberal World Order also began in
favor of the opposing one underpinning the Neoliberal Global Order:
no more protecting domestic societies from the threats coming from the
international environment, but rather shielding global markets —especially
financial ones—from any interference coming from domestic societies.12
People’s rights, trade unions activities, salaries, workers’ and middle
classes’ living standards: they all started to be compressed. In order to
enable this change to occur, a cultural–political shift was put in place in
terms that can be understood through the notion of Gramscian hege-
mony, which altered an apparently simple political question: which—and

12 This is the opposite goal of the Bretton Woods System. See Ferrarese (2017: 177):
‘The internationalism introduced in 1944 was not without flaws and did not escape
the ambiguities of previous international agreements which were often only the mask of
national or imperial interests. However, the intent of that structure was to pursue an
internationalization that could be defined as ‘moderate’, as it took place under the aegis
of the States, so as to allow them to pursue their domestic social and economic objectives,
using the controlled opening of markets to increase the prosperity of national companies’.
14 V. E. PARSI

whose—intererst and walues deserve priority protection by the political

and governmental action?
The reply to this question was formulated along three different
but converging cultural–ideological lines: neoliberalism, neoconserva-
tivism, and ordo-liberalism. Neoliberalism blamed ‘big government’ for
being responsible for resource squandering, impairing the market from
producing wealth; it also stigmatized the working class for demanding
too much in terms of rights and wages, as assessed in the famous Trilat-
eral Commission Report of 1975 (Crozier et al. 1975). The opposition
between market and state was to serve as the narrative of the neolib-
eral discourse (Harvey 2005). While neoliberalism was doing its part,
neoconservatism ushered in a discourse that would produce the ‘revolt’
against the former ‘progressive era’ in the name of the restoration of
law and order, the rights of the moral majority, the re-establishment of
family and traditional values, the praise of meritocracy and the stigma
toward equality (Wolin 2008). The third cultural line was that threaded
by ordo-liberalism, based on the Austrian-German school of thought,
which, while admitting the relevance of collaborative state-market rela-
tionships, was mainly used to justify harsh new state policies rewarding
capital at the expanse of labor (Slobodian 2018).13 Neoliberalism and
ordo-liberalism both under-evaluate the weight of the ‘incumbents’—i.e.,
how the stronger market actors can hijack the so-called ‘pro-market’ polit-
ical decisions to their own exclusive favor. This is the problem of the
regulator’s capture by the strongest, the biggest, the richest, which has
been a main concern for classical liberals since the age of Tocqueville.
In short, we progressively moved away from what I refer to as
the Liberal World Order’s original triangle of the—made up of ‘open
market’, ‘state sovereignty’, and ‘international institutions’—toward the
Rodrik trilemma—including open market, state sovereignty, and democ-
racy. While the ‘liberal triangle’ is assumed to be able to simultaneously
manage the three corners and create and preserve peace, wealth and
democracy, the ‘Rodrik trilemma’ maintains that democracy, sovereignty,
and open market cannot all function at the same time (Rodrik 2011).
As John Ikenberry points out: ‘Liberal internationalism also needs to
reclaim its legacy as a set of ideas and programs for managing economic

13 Slobodian (2018: 259) analyzes the influence of Hayek thought though what he
calls the ‘Geneva School’ able to combine the global scale with the German ordoliberal
emphasis on institutions and the moment of the political decision.
 1 THE LIBERAL ORDER … 15

and security interdependence. Its aim should not be to open and integrate
the world system but to cooperatively shape the terms of openness. This
means embedding markets and exchange relations in rules and institu-
tions that balance the trade-offs between efficiency and social protection.
Achieving this balance may mean a reduction, at the margin, in trade
openness and integration. The goal is less about building or eliminating
borders than agreeing upon principles and institutions for the cooperative
management of border’ (Ikenberry 2020: 308–309).
During the Cold War, communist states were largely assumed to have
‘limited sovereignty’, yet since 1989 it is, liberal states that have seen their
economic sovereignty diminished as a consequence of the ‘confiscation of
sovereignty’, not by a foreign power—the Soviet Union, in the case of
the Warsaw Pact—but by the market. Market logic predicates protection
of free competition, but in practice, it shields concentrated wealth and
power. The logic of sovereignty has succumbed to that of the market and
the imperative of regulating the market has been replaced by that of ‘self-
regulation’, which creates false myths and covers up the dysfunctional
consequences of deregulation (Rodan 2006).
What we have been facing in these years is a general weakness
of the liberal narrative and practice in managing the natural tensions
between market and democracy, freedom and equality: in a nutshell,
‘the unfairness of the system’ (Rajan 2010). It is no surprise that ‘ordi-
nary people’ reacted by defecting the system. In terms of Hirschmann’s
‘exit/voice/loyalty’ scheme (Hirschman 1970), Western democracies and
liberal political cultures have been losing ‘loyalty’, facing a radicalization
of ‘voice’, and experiencing a worrying growth of right-wing political
cultures and actors (i.e., an exit option) that pose an ‘existential threat’
to liberal democracy. This could also be a major problem for the survival
of liberalism good achievements and values.
Too often, thinking of how powerful concentrated interests are, we
might be afraid of not being able to counteract the sinister antiliberal
forces. We tend to forget that values are as powerful a lever as interests
in modifying reality. Reassessing what is acceptable—and what is not—is
the ethical and political battle we need to fight to have fairness regain the
center of political life. This is indeed key for recovering popular trust in
political and economic institutions, which is at a low point in the history
of democracies. The rule of law and the separation of powers constitute
the balance point between economic wealth, concentrated in the hands of
16 V. E. PARSI

few, and the interests of the rest. In addition to this, only liberal democ-
racy can protect private property from the politics of predatory instincts.
Yet, rule of law and separation of powers come at a price, as they can only
exist as long as they are not reduced to a docile instrument to legitimize
privilege. In our current global economy, ‘the happy few’ need democratic
political institutions that can only be supported by the consensus of the
majority. This abiding coincidence of interests is the pivot on which the
lever of liberal and democratic values can work. The interaction between
interests and values for every political decision reveals—and conceals at
the same time—a specific balance point—one of many feasible—and in
turn produces winners and losers, better-offs and worse-offs. Only by
changing this balance point between interests and values, conducting a
long-term cultural fight to defeat neoliberal and conservative hegemony,
we can come up with a new Liberal World Order up to this century’s
challenges and make democracies—rather than any given state—‘great
again’.

The Structure of the Book

Having set out the theoretical premises to analyze the mutation of the
Liberal World Order into the Neoliberal Global Order and the breaking
point that long-established West-centered international arrangements
seem to have reached, the book proceeds as follows: Chapter 2 offers
a closer look into the key elements of the value-based political agendas,
as well as the international context in which the post-World War II order
was founded. At the roots of the primogenital form of Liberal World
Order was the assumption that the domestic and international realms, as
political and economic affairs, are highly interdependent. The architects
of the Liberal World Order were moved by a twofold concern: on the
one hand, they wanted to set the conditions for an open and strongly
institutionalized international system in which liberal and market democ-
racies could be safe and prosperous; on the other hand, they wanted to
strengthen the democratic domestic political and socioeconomic systems
that were going to be the pillars of said international order. The polit-
ical inclusion of the masses required greater attention to be paid both
to democracy’s premises—i.e., acknowledging and making practicable the
formal equality of all citizens—and its promises—so as to narrowing the
historically widening gap between the two. This entailed, first and fore-
most, keeping the excesses of market-generated inequality under control.
 1 THE LIBERAL ORDER … 17

The chapter also examines the double effect trigged by the domestic
and international threats posed by communist parties and movements,
and the USSR, respectively. At the center of the system—the transat-
lantic West with its extensions, such as Japan—these threats served as a
motivation to preserve the compromise between democracy and market
economy, especially through the ‘embedding’ of the latter within a liberal
political arrangement. In the periphery of the system, anti-communism
became the main—possibly the only—requirement to fit into the inter-
national order, coupled with the opening of domestic markets. Without
the external constraints and incentives deriving from the Cold War, the
transition from an ‘embedded capitalism’ to an ‘embedded democracy’,
already creeping in several corners of the world, went underway for
good.14 Ever since, deregulation—or, more precisely, a neo-regulation of
the market that has been disproportionally advancing the interests of its
main operators—has served as the order’s guideline.
Chapter 3 examines the failed distribution of the ‘dividends of peace’
at the end of the Cold War. Three main promises—i.e., of a safer,
fairer, and richer world for everyone—were broken. From 1990 onwards,
Western democracies have been militarily engaged in a growing number
of conflicts, with generally poor results. Especially after 9/11, they were
forced to acknowledge that military force—the field in which the West
still retains a conspicuous advantage on those who threatened its secu-
rity—has not been resolutive. The West has been forced to admit that it
is neither ‘invulnerable’ nor ‘invincible’. The unwillingness to consider the
profound roots of the dissatisfaction that is feeding radical Islamism was
manifest in the reactions of the Western countries to the Arab Springs
of 2010–2011. The Middle East was the place where the greatest gap
emerged between the promise of a multilateralism-oriented international
system, governed by law and institutions, and the reality of US dominance
and its—sometimes reluctant—Western allies, often corresponding to the
old colonial powers. What Washington meant by ‘regional stability’ was
manifest in the centrality of the triangulation with Tel Aviv and Riyadh.
In economic terms, we witnessed the transition from ‘market freedom’
to ‘market dictatorship’, where fair competition has been replaced by
birth and wealth privileges. The alliance between democracy and market
economy—the compromise between the reasons of politics and those of

14 I use this concept as a mirror of John Ruggie’s concept of ‘embedded liberalism’,

and not in the sense in which it was employed by Merkel (2004).
18 V. E. PARSI

economics—blew up with the 2007–2008 crisis and the consequent Great

Recession, which has shown how the market can be its own worst enemy
and how ‘market success’ can have consequences as dire as its failure. I
am evidently speaking of an ill-regulated market, and/or limitless market,
one whose hegemonic logic overflows every realm, because no other logic
counters its weight.
Chapter 4 will show how, during the last decade, China and Russia
have grown in power and influence. In comparison with the unipolar
era, these two authoritarian powers are now able to strategically exploit
the mistakes of the United States—and, more generally, its retrenchment.
Putin’s Russia has considerably reorganized and modernized its military
capacity, most evidently in the Arctic region. It has also been able to capi-
talize on Western indecisiveness and division in Syria (2013) and Crimea
(2014). In the Middle East, Russia cleverly profited the most from the
agreement on the Iranian nuclear program—Joint Comprehensive Plan
of Action/JCPOA—and started its own triangulation—with Iran and
Turkey, the latter a member of NATO—as a response to the one between
the US, Israel, and Saudi Arabia (Calculli 2019). China has also increased
its soft power with the Belt and Road Initiative (BERI), an international
economic and financial infrastructure that could potentially replace the
current one. This decision is linked to the financial crisis of 2007–2008,
which has changed the cost/benefit ratio of tailing the United States
in the Chinese perception. The relationship between Beijing and Wash-
ington seems bound to remain a competitive one, both in security and
economic-financial terms.
In Chapter 5, we will see how the ‘molecularization of threat’ has
been the main characteristic of the post-9/11 era. The War on Terror
has also become the legitimization for the resort to force, both at the
domestic and the international level. One needs only to think of Syria and
the repression exerted by the Assad regime, which has led first to civil
war and then to the internationalization of the conflict. Saudis, Turks,
Russians, the Western powers, Iranians and Israelis, and even the Kurd
militias and Hezbollah: everyone has used the War on Terror to justify
their actions in Syria. But the same argument was used for the interven-
tion in Yemen, the repression in Israel and Egypt, and the interventions
in post-Gaddafi Libya. It was also used by China to justify its treatment
of the Uyghurs. The War on Terror has also changed the Mediterranean
Sea, initially turning it from the ‘American lake’ it had practically become
 1 THE LIBERAL ORDER … 19

during the final stage of the Cold War into the logistic rear of Amer-
ican power projection in the Middle East. But the Mediterranean has also
become Europe’s weak link, the porous wall for the migration flows that
the European countries have refused to manage in a humane, common,
and organized way. We witnessed the securitization of the migration
issue, which has been reduced to a ‘law and order’ problem only focused
on contrasting migration itself. But we also witnessed the failure of this
approach.
In Chapter 6, I argument how Donald Trump’s appearance and his
extraordinary and unexpected success in the 2016 elections stem from
the feelings of alienation of tens of millions of voters who felt marginal-
ized by the increasing financialization of the economy, the expansion
of international trade and the delocalization of production, as well as
by the impact of the new information revolution, centered around the
Internet and artificial intelligence. These dynamics are still at play, even
though Trump is no longer President of the United States. The contrac-
tion of wage shares and the development of the ‘1 percent economy’
represent a tendency that has grown along with the transformation of
market economy, creating the condition in which private income and
birth-related privileges play a much greater role than entrepreneurial skills.
This situation explains the political decisions synthesized by the slogan
‘Make America Great Again!’ Protectionism, the denunciation of treaties,
the questioning of the key institutions of the Liberal World Order, and the
persistent challenge of partners and allies are a product of the idea that the
interests of American citizens have been compressed and sacrificed by the
excessive condescendence toward ‘foreigners’ of US governments. This
attitude was reinforced by some more ideological convictions, in conti-
nuity with the neoconservative policy of George W. Bush, such as the
blind adhesion to Israel’s positions in the Middle East and the ostentation
of privileged relations with the conservative monarchies of the Gulf. The
unilateral withdrawal from the JCPOA is partly explained by this ideo-
logical orientation, as well as by the aim to cancel the political legacy of
Trump’s predecessor—including ‘Obamacare’. Donald Trump’s interna-
tional action has systematically discredited the institutions, cast shades on
the relationships with the allied countries, and exacerbated tension with
rivals. These are the gravest aspects of the administration’s legacy with
regards to the international system and the Liberal World Order.
In Chapter 7, I will illustrate how the malaise that led Trump to the
White House in 2016 is not limited to the United States. All democracies
20 V. E. PARSI

are being increasingly sieged by populist and technocratic impulses—since

only within democracy can these impulses be freely expressed. Populism
tends to deny the composite nature of the people—which entails that
nobody has a right to its exclusive and definitive representation—and to
devalue the natural tension between the people and institutions (Posner
2017; Mounk 2018; Urbinati 2019). Technocratic impulses limit the
preferability scope of choices by diminishing the relevance of values and
of the dialectic among different interests in light of ‘necessary choices’
that are not up for debate, as they are claimed to be ‘politically neutral’
(Berman 2018). We have considered how the success of the techno-
cratic era has laid the ground for the ‘revenge’ of populism, which can
have both left-wing and right-wing connotations, with an ‘inclusive’ or
‘nativist’ concept of the people, respectively (Bickerton and Invernizzi
Accetti 2017; Caramani 2017). Finally, I consider how, in the last decades,
the circulation and pluralistic nature of the elites have diminished as a
consequence of the breakdown of the social elevator and the oligarchic
transformation of the political, as well as of the economic, circuit. The
weight of inequality has transformed our societies in a similar way as
the ‘enclosures’ stiffened the relations between landowners and rural
communities in eighteenth-century England.
Chapter 8 looks into the opportunities and limitations of a reshuffle
within the transatlantic community, in order to salvage the leadership of
what is left of the Liberal World Order. In light of America’s decreasing
willingness and capability to remain at the helm of the machinery that has
given—with variyng results—a direction to world politics, Europe’s and
the European Union’s potential for at least sharing the burden to guide it
will be examined. In doing so, the Europe-specific manifestations of the
New Global Order’s encroachment will be analyzed, especially those that
erupted as a consequence of the global financial crisis which, trigged the
notorious Eurozone public debt crisis, exposed the multifaceted and at
traits tragic aberrations plaguing national socioeconomic systems and the
EU’s institutional functioning. Nevertheless, the European integration
process, for all its flaws and inconsistencies, offers a valuable opportunity
to consider what an adequate and effective recombination of interna-
tional order, sovereignty, and market openness should look like, provided
that a new generation of liberal-minded architects actually emerge, one
willing to pick up the baton of ‘world-engineering’, reaffirming—and
when necessary reviewing—the principles and the practical institutional
 1 THE LIBERAL ORDER … 21

that hopefully will lead to a redefinition of the West’s identity and polit-
ical structure—including the EU and the transatlantic relations—and the
ever more necessary dialogue with the rest of the world.
In the Conclusion, besides summarizing the responses that the book
will provide to the question just presented, the point is made that, for
the al Liberal World Order to get another chance to exist and function, a
fairer and more inclusive domestic democratic system will need to be (re)-
established, together a renewed transatlantic cooperation. Moreover, an
outlook will be provided about the possible effects of the election of Joe
Biden to the US presidency, as well as the consequences of the COVID-
19 pandemic, especially in terms of the opportunities that it may present
Europe to finally transform into ‘a deeper and closer Union’—absolutely
needed for playing a major active international role.

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 PART I

Out of Route
 CHAPTER 2

Titanic, or the Unsinkable Order: Origins,

Expansion, and Betrayal of the Liberal World
Order (1945–2000)

In this chapter, I examine a set of elements that are key to understand the
rise and—possibly provisional—fall of the Liberal World Order. At the
roots of this distinctive arrangement lay the assumption that the domestic
and international realms, as well as, political and economic affairs, are
highly interdependent—as argued in the previous chapter. The architects
of the Liberal World Order were urged by a twofold concern. On the one
hand, they wanted to rebuild an open and strongly institutionalized inter-
national system in which liberal—‘therefore’ market—democracies could
be safe and prosperous. On the other hand, they aimed to strengthen
the domestic political and socioeconomic systems that were to be the
pillars of the new international order. The interwar years had taught
them a clear—and tough—lesson: financial and economic shocks can
cause dramatic social crises, as well as deep political and institutional
predicaments. Hence it was vital to prevent protectionist policies from
making costly and ineffective recovery-oriented national plans, which
were also bound to steer up international hostility, xenophobia, and chau-
vinist nationalism—which, in turn, are likely to generate further market
closure, isolationism, and unilateralism. The tensions between the demo-
cratic political dimension and the liberal economic one exploded as a
consequence of the 1930s specific circumstances, but they also revealed a
structural issue in the relationship between mass democracy and market

© The Author(s), under exclusive license to Springer Nature 29

Switzerland AG 2021
V. E. Parsi, The Wrecking of the Liberal World Order,
Palgrave Studies in International Relations,
https://doi.org/10.1007/978-3-030-72043-8_2
30 V. E. PARSI

economy (Halperin 2003). An ill-regulated market undermined the very

foundations of democracy (Merkel 2014). The political inclusion of the
masses required greater attention both to the ‘premises’ of democracy—
enabling actual formal equality for all citizens—and its ‘promises’—i.e.,
keeping in check the excesses of market-generated inequality—so that the
two converge, rather than diverge. The Cold War and the threat posed
by communism and the USSR exerted a double influence. On the one
hand, they allowed the core of the system—essentially ‘the West cum
Japan’—to abide by the commitments to the balance between democ-
racy and market economy— and its fundamental interest in embedding
the market. On the other hand, moving toward the system’s periphery,
anti-communism was the only requirement to fit in the liberal order,
coupled with the international opening of domestic markets (Jahn 2013;
Müller 2019). The end of the Cold War marked the definitive transition
from an ‘embedded capitalism’ to an ‘embedded democracy’1 that bent
backward to the needs of an ever less regulated market—more precisely,
a market steered by the interests of its most important operators. But
the attack on of progressivism’s cultural hegemony had already begun in
the 1970s, the result of three combined dynamics: (1) the ascendancy
of monetarism; (2) the distortion of Hayekian ordo-liberalism, with his
emphasis on authoritarian elements and the need for governmental contri-
bution to market protection, which would lead the ‘deregulation credo’;
(3) the neoconservative mission aimed at replacing class interests with
‘non-negotiable values’—whose forebear had been the so-called ‘moral
majority movement’—(Bebbington et al. 2013; Chodor 2015; Navarro
2020; Nedergaard 2020; Owen 2018; Wilkinson 2019). Franklin Delano
Roosevelt’s concerns—‘The test of our progress is not whether we add
more to the abundance of those who have much, it is whether we provide
enough for those who have too little’2 —would return to be confined
to the granite stone of his memorial. We would revert to a re-edition
of the unbridled economic liberalism that devastated market societies

1 As already mentioned in Chapter 1, I use this concept as a mirror of John Ruggie’s

concept of ‘embedded liberalism’, not in the modality employed by Wolfgang Merkel
(2004).
2 Franklin Delano Roosevelt, “Inaugural Address, January 20, 1937”. Franklin
D. Roosevelt Four Freedoms Park. Four Freedoms Park Conservancy. Avail-
able at https://www.fdrfourfreedomspark.org/blog/2015/2/17/fdrs-second-inaugural-
address-january-20-1937.
 2 TITANIC, OR THE UNSINKABLE ORDER … 31

throughout the nineteenth century, which was denounced by Karl Polanyi

during World War II (Desai and Polanyi Levitt 2020). A full-fledged
betrayal of the Liberal World Order.

The Origins and Foundations

of the Liberal World Order
The Liberal World Order is the complex of principles and institutions that
ruled the international system since the end of World War II. Based on
the United States’ leadership, and fleshed out through five main insti-
tutions—the United Nations (UN), the International Monetary Fund
(IMF), the World Bank (WB), the General Agreement on Tariffs and
Trade (GATT), and the North Atlantic Treaty Organization (NATO)—
it promoted economic development and granted political security in a
large part of the world during the Cold War (Eichengreen and Vazquez
2000; Gaddis 2006). Its conception dates back to WWII, when Franklin
Delano Roosevelt and Winston Churchill began to outline the features of
the international order that was to replace the one that was being swept
away by the ongoing conflict (Leffler and Westad 2010).
The project of a new world order aimed to address two basic concerns.
The first was to preserve peace through the building of a universal, gener-
alist institution replacing the League of Nations. While recognizing the
limits of the latter, the Atlantic leaders believed that the principle that
had inspired its construction had to be safeguarded, while being aware of
its flaws. The United Nations was founded on these premises (Cottrell
2017; Jackson and O’Malley 2018). With the soon-to-be winners of the
war at its core, the UN would admit all the states that would embrace
its principles, starting with the limitation of the use of force exclusively
for self-defense purposes; the concerted effort of all members toward the
goal of collective security; and the formal equality of all states and the
respect for national sovereignty, complemented with the right of peoples
to self-determination—even though a consistent part of humanity was
still subject to colonial domination. At the same time, from a realistic
standpoint, the UN would acknowledge the privileged status of winning
great powers—United States, Soviet Union, China, and United Kingdom,
as well as France, only included due to its large colonial possessions—
granting them a permanent seat and veto power in the Security Council,
so making them the de facto leaders of the organization (Schlesinger
32 V. E. PARSI

2003). At the time of the UN’s foundation, there was still hope that rela-
tions with the Soviet Union would stabilize on cooperative terms as they
had during the war (Gaiduk 2013). It was also believed that the nation-
alist forces of Chiang Kai-Shek would prevail in postwar China (Shen
2011).
The juridical fabric of the United Nations was of manifest Amer-
ican design. The coexistence of the equality principle, expressed by the
General Assembly, with the reality principle, synthesized by the special
status reserved to the ‘big five’ of the Security Council prevented the
UN from ending like the League of Nations, even though its consti-
tution was almost simultaneous with the onset of the Cold War (Hurd
2002; Peterson 2006). In spite of the stark opposition within the Security
Council between Washington and Moscow, the United Nations played
a crucial role during the US and USSR bipolar competition, offering a
permanent forum with an institutionalized code of communication facili-
tating an as peaceful as possible cohabitation between enemies during the
incoming nuclear era. However, it was only after the end of the Cold War
and the collapse of the Soviet Union that of the UN’s statutory goals first
appeared achievable.
During the brief season known as ‘the unipolar moment’ of the inter-
national system, the United States not only enjoyed the benefits resulting
from a tremendous political, military, and economic gap with any other
states but, most importantly, it also had no other power willing—or able
for that matter—to challenge its global leadership. Hence, the prospect
of a new world order finally fully consistent with the principles of the
UN Charter seemed to be attainable (Brands 2016; Nye 1992, 2020).
The failure to do so can be regarded as the greatest wasted opportunity
in modern times (Brooks and Wohlforth 2008). As Tony Judt rightly
observed, we ‘missed a once-in-a-century opportunity to re-shape the
world around agreed and improved international institutions and prac-
tices. Instead, we sat back and congratulated ourselves upon having won
the Cold War: a sure way to lose the peace. The years from 1989 to 2009
were consumed by locusts’ (Judt 2010: 138).
The second concern in the years following the end of World War II
was to avoid falling in the same path that had led to the formation of
closed economic blocks and the draconian commercial protectionism of
the 1930s (Panić 2003). The latter was correctly believed to have been a
composed cause of the expansion and deepening of the 1929 stock market
crash, having amplified its effect in terms of resource destruction. It also
 2 TITANIC, OR THE UNSINKABLE ORDER … 33

served as an accomplice—through the diffusion of poverty and hostility

toward the ‘unfair competition’ from foreign entities—of the success of
fascist and ultranationalist movements across Europe and in Japan in the
interwar period (Ikenberry 1993). These are all recurring concerns for
advocates of freedom and democracy. At the same time, they are coarsely
incorporated among the arguments of those who equate the protection
of freedom with the advancement of total free circulation of factors of
production, conveniently omitting that while capital can choose to move
or not, labor is often forced to do so—and in exchange for different
and unfairly lower remuneration rates. The 1944 Bretton Woods Agree-
ment, which fixed the exchange rate among the main currencies of the
world, was designed to avert this danger. Anchored to the US dollar as
the international reserve currency, due to its convertibility with gold, it
was based on the newly instituted IMF and WB, whose purpose was to
supervise the stability of exchange rates, counteract financial speculation
and support economic development, and, later on, the GATT. However,
due to the divisions between East and West, these measures were only
applied in the ‘free world’—that is in non-communist countries. This
is no small clarification, because an increasing number of hardly liberal
political regimes were developing connections with the Liberal World
Order—Francoist Spain, Antonio Salazar’s Portugal, the Central Amer-
ican Republics, apartheid-ruled South Africa, the Iranian monarchy, as
well as the countless authoritarian regimes that emerged from the decol-
onization of Africa and Asia (Westad 2005). At best, these regimes could
only be regarded as liberal insofar as they protected private property,
albeit limitedly so, and only as long as it did not interfere with the
power elites’ interests. However, they all allowed international access to
their markets and resources. They were ‘client states’ rather than ‘allied’
of the Western democratic powers: the United States, of course, but
also United Kingdom and France (Parsi 1998). I point this out not for
the sake of controversy, but to mark the difference between the center’s
and the periphery’s involvement in that order. This difference reveals a
relevant aspect of the Liberal World Order immediately: while liberalism’s
political and economic principles were presented as a perfectly consistent
combination, there was in fact a sort of intrinsic tension between the
two dimensions (Hardin 1993; Helleiner 2003). This friction was most
clear in the international realm, and it was decidedly resolved in favor of
the center over the periphery, and of the economic dimension over the
political one (Goldgeier and McFaul 1992; Kwon 2010).
Another random document with
no related content on Scribd:
driven in so as to hold the string securely. This will give a tufted
effect to the cushion top, and will make the mattress more secure.
Run a line of gimp or narrow belting around the top of the box over
the tacks that fasten the valance, and with large, oval-headed
upholsterers’ tacks make a line of heads three inches apart all
around the sides and front. This will make an effective finish.

A Corner Dressing-table

A very pretty dressing-table for the corner of a girl’s room is shown

in the illustration (Fig. 25). This can be made by a boy for his sister,
or by a girl with a liking for such work. As shown in Fig. 26, it is built
up on a sugar barrel, which is thirty inches high and twenty-four
inches across at the widest place. When it is inverted, screws or
nails can be driven through the bottom to hold the triangular ledge or
table-top in place.
Three boards should be cut to form a quarter of a circle thirty
inches long on the two straight sides, as shown in Fig. 26 A. The
sweep, or curved edge, is one-quarter of a five-foot circle. Fig. 26 A
also shows how this quarter-circle is placed on the top of the barrel.
To keep the boards together, two battens thirty inches long are
nailed or screwed underneath the straight edges.
Screws rather than nails should be used in fastening the quarter-
circle to the barrel. They will not pull out or work loose so readily as
nails.
The canopy top is supported on a framework consisting of three
sticks, each three feet long, and a triangular top made of three short
sticks, as Fig. 26 shows. At the top the sticks are joined as shown in
B, and the lower ends are attached to the table-top with long, slim,
steel-wire nails.
 Fig. 25.

If the color scheme of the room is pink, pale-green, or canary

color, this same color may be carried out in the drapery. Sateen or
colored cotton goods may be overlaid with a dotted swiss or scrim,
and tacked to the framework. At the bottom a valance is made and
caught to the circular edge of the ledge, which is covered with gimp
held by brass-headed tacks.
The upper sticks of the frame are bound with strips of white muslin
before the drapery is attached. This is to prevent the wood from
showing through the goods, and also to make an anchorage in which
some stitches can be taken, if necessary, to hold the canopy drapery
in place.
 For this top it will be necessary to have two swiss or thin scrim
coverings, between which one thickness of the colored material is
laid. Both sides of the drapery will be seen, and it is necessary to
show the colored goods on both sides.
A shirred band of the goods may be arranged along the top stick
of the canopy, and bows at the corners of the top and the edge will
add to its appearance.
An oval or square mirror in a white or light enamelled frame can be
suspended by wires from the top.

The directions as to methods and the suggestions of designs

given in this book open a broader and more inviting field, it is
believed, than has been accessible in similar form before. That there
is need of a new handy-book comprehensive, well tested, and
designed on practical modern lines seems to be indicated by the
popularity of the preceding volumes in this series: Harper’s Outdoor
Book for Boys and Harper’s Electricity Book for Boys, which,
together with Harper’s How to Understand Electrical Work, form the
modern “Boy’s Own Library.”

THE END
 *** END OF THE PROJECT GUTENBERG EBOOK HARPER'S
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