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About Peter Rutland

I a Professor of Government at Wesleyan University in Middletown, Connecticut. My main research interest is Russia and the former Soviet Union, but I teach a course on nationalism around the world. This blog is connected to the course I teach. It includes links to new articles on recent developments where nationalism is shaping political events.

Deciphering Pakistan

There’s not much good news coming out of Pakistan these days. But at a conference at Wesleyan University on October 1, a group of Pakistan experts were cautiously optimistic about some of the trends unfolding in that troubled country.

Since its creation, Pakistan’s identity has been defined in contrast to India. Veteran journalist Najam Sethi, editor of Lahore’s Friday Times, explained that in Pakistani politics the foreign policy tail wags the domestic politics dog – and that means the army, as the guardian of national security, can play a pivotal role. Despite the track record of four coups against civilian governments, Sethi argued that a coup is unlikely in the near future. Recent years have seen the activization of a combative media (local TV as well as newspapers) and an independent-minded judiciary. Equally significant is the fact that the opposition Muslim League led by Nawaz Sharif has signaled that it has no inclination to support a military coup against the incumbent People’s Party government. Previous coups were only possible because of the compliance of rival parties, and the judiciary.

Facing creeping political marginalization, the army has stepped up its nationalist appeal. But one other recent trend according to Sethi is a shift from anti-Indianism as the cornerstone of Pakistani nationalism towards anti-Americanism – a trend accelerated by the uptick in drone attacks and the raid to kill Osama Bin Laden. This development may be bad news for America – but it may ironically contribute towards peace in the region if it facilitates reconciliation between New Delhi and Islamabad.

At the Wesleyan panel, Harvard economics professor Asim Ijaz Khwaja likewise saw grounds for optimism in the increase in civil society engagement, as evidenced for example by the spread of private (non-religious) schools, now accounting for one third of all pupils. He acknowledged that there was an increase in self-identification as Muslim, but he saw this as complementing and not substituting for Pakistani identity.  Sethi saw these two identity categories as in tension with each other, claiming that polls show 70% of Pakistanis identify primarily as Muslim.

London University professor Humeira Iqtidar had an interesting and somewhat controversial take on the rise of political Islam. She defines Islamism as the movement to develop a political agenda based on Islamic principles – that is, to engage with the modern state, and to start a discussion about what it means to be Muslim. Islamism is not simply a pietist desire to return to a traditional past. But in becoming engaged in politics, Islamist movements are forced to compete and bargain with other groups, and this find themselves inadvertently contributing to the emergence of a de-facto pluralism within democratic rules of the game. You can find her argument in this June 2011 article from the Guardian. She is the author of Secularising Islamists? Jamaat-e-Islami and Jamaat-ud-Dawa in Pakistan (2011).

Another challenge to Pakistani identity is the growing regionalism. Decentralization was a consequence of the 18th amendment to the constitution passed in April 2010, weakening the powers of the presidency. More power has been devolved to the provinces  – another reason why a military coup is less likely.  I discussed Baluchi separatism in an earlier blogpost. As discussed in a recent article in the The Dawn, there is also a modest separatist movement in Sindh, building its identity as “land of sufis” more tolerant than Punjab.

Round-up of nationalism stories around the web

This week I was interviewed for an NPR story on ‘America’s love affair with nationalism.’

In Barcelona, the last bullfight was held this past weekend, after a law was passed banning the practice in Catalonia. The law was introduced at the request of animal rights activists, but it was in part driven by a desire to distance Catalonia from Castillian culture. Catalonia is distinctive in at least one other respect: it has its own internet domain address:  .cat  According to Wikipedia there are only a handful of non-nation states in the world with their own web address, such as Antarctica, Hong Kong, and the Palestinian Territories.  Catalonia won its own address in 2005 – though technically the address is for Catalonian culture and not for the specific territory of Catalonia.

At the other end of Europe, in Denmark a parliamentary election brought to an end ten years of center-right rule. Contrary to those who argue that economic crisis invariably leads to xenophobia towards immigrant groups, the immigration issue did not feature prominently in this campaign – in contrast to previous elections. Support for the anti-immigrant Danish People’s Party declined 1.5%, to 12%.

Meanwhile  if you want to apply for a job at a university in Sweden you should learn Swedish – English only applications are not allowed, according to a recent decision by the parliamentary ombudsman.

Nationalism, the Arab Spring, and the new Middle East

Before the Arab Spring, the assumption was that Arab nationalism had been tried and failed, and Islamism was the new – and dangerous – movement capable of mobilizing the ‘Arab street.’ What a difference one year can make. Nationalism is back in the Middle East. In reality it had never actually gone away, but had been in political remission.
Nationalism was the crucial element enabling the various factions in Tunisia, Egypt and Libya to unite behind a common cause – using the national flag as their symbol. As the Libyan author Hisham Matar said on Al Jazeera earlier this year, “People in Tunisia, Egypt and now Libya are rediscovering what it means to be a people — their national identity, their sense of themselves.” It was not accidental that Tunisia was the country where the first and crucial democratic uprising took place. Tunisia had developed a robust sense of national identity – in part because of a vigorous nation-building campaign conducted by its first dictatorial ruler, Habib Bourguiba, who was in power from 1957-87. (On this, see A History of Modern Tunisia by Kenneth Perkins, 2004.)
After the revolution, the Egyptian military have been trying to regain the political initiative by stoking xenophobia – particularly anti-Americanism – in order to discredit the pro-democracy movement. This was explained in an important article by Yaroslav Trofimov in the Wall Street Journal on 10 August.  For example, the state-run media criticized the finance ministry for negotiating a $5.2 billion stand-by loan with the IMF as an example of neocolonial exploitation – even though the 2.5% interest rate was half that being offered by Qatar. The government has announced that international observers will not be allowed to monitor the elections in November.
On the other hand, nationalism may yet slip out of the Egyptian military’s control. The protesters’ attack on the Israeli embassy earlier this month was motivated by nationalism, and was something the government did not want to see happen. President Anwar Sadat had persuaded the Egyptian people that Egypt had won the October 1973 war, so Egyptians don’t realize that the Camp David peace with Israel was a result of Egypt’s military defeat. Instead they thought that Sadat had sold them out to the Americans.
The rise of nationalism is not confined to the countries of the Arab Spring. Ethan Bronner writing in the New York Times on September 18 noted the resurgence of nationalism in the two democracies of the region – Israel and Turkey. He wrote “The two countries have gone through remarkably similar political shifts in recent decades from aggressively secular societies run by Westernized elites to populist ethno-religious states where standing up to foreigners offers rich political rewards.” “Ben-Gurion, who studied law in Istanbul, modeled himself on Ataturk, seeking to build an instantly modern society of like-minded and ‘ideal’ citizens with few deviations in language or culture. Both saw religion as a deviation.”
Likewise, over in Iran President Mahmud Ahmadinejad’s struggle for power with the conservative clerics who rule Iran revolves around his aggressive promotion of Iranian nationalism, as explained by in this piece by Mahan Abedin.
It is not surprising, then, that the Palestinian National Authority wants to join the nationalist bandwagon by applying for recognition at the United Nations.

European identity: shaken by the economic crisis

The results of the new Eurobarometer poll, conducted in May 2011, are now available. They make for disturbing reading for those who see the European Union as a remarkable achievement in promoting economic prosperity and peaceful coexistence. The European integration project was already weakened by the protracted and unsatisfactory debate over the proposed new constitution, which resulted in the anemic Lisbon Treaty. Since then the 2008 economic recession and ongoing Greek debt crisis have fanned the flames of Euroscepticism.
Positive evaluations of trends in the EU are voiced by a majority of respondents in only five of the 27 member countries: Poland, Slovakia, Latvia, Hungary and Ireland. (Note that four of the five are recent East European entrants.)  Across the whole continent a majority – 47% to 41% – say they tend not to trust the EU. The EU takes some solace from the fact that young people are more positive: 53% of 15-24 year olds trust the EU. However, in 22 of the 27 members, a majority of the public still think that their country has benefited from EU entry, led by the Irish (78%) and Poles (73%). Britain as usual leads the Eurosceptics: 54% of British respondents believe that their country has not benefited from EU entry.
Identification with one’s nation rather than the EU seems as strong as ever. 46% of Europeans identify only with their nation-state; while 41% say they are “National and European.”  7% said they were “European and national” and a mere 3% said they were “European only.” (These figures are from 2010, the question was not asked in 2011.) There has been no trend towards closer identification with the EU over time. Back in 1992, the corresponding results were 38% national, 48% national/European, 6% European/national and 4% European.
Much of the new report examines public opinion in the aftermath of the 2008 financial crash. When asked which institution was likely to be most effective in tackling the economic crisis (p. 13 in this report), the EU was selected by 22% of respondents – ahead of their national government (20%) or the IMF (15%). But that looks more like a sign of despair at the lack of effective leadership than a ringing endorsement of EU institutions.
Sixty-two percent of respondents said they sometimes see themselves as EU citizens. But what does the EU mean to them? The question of what do you associate with the EU produced the following results (p. 32 in this report): Freedom to travel and work 45%; the Euro 38%, waste of money 24%, peace 22%, a stronger say in the world 21%, bureaucracy 21%, cultural diversity 20%, and democracy 20%. Economic prosperity clocks in at a mere 14%.

Top ten nationalism movies

These movies are selected partly for their artistic qualities but mainly for the insights they can provide into nationalist thought and behavior. It is of course a subjective selection and I would welcome additional suggestions. Some of the best nationalism-related films are little known: made for TV or shot in distant countries on low budgets (such as The Terrorist, which cost $50,000).

I tried to avoid straight nationalist propaganda films such as Henry V (1989), Braveheart (1995), Saving Private Ryan (1998), The Brotherhood of War (2004) or Opium War (1997), although these films are valuable in their own way.

1          Battle of Algiers (1966) Gillo Pontecorvo’s documentary-style portrayal of Algeria’s war against French colonialism became an instant classic. Pontevorvo’s stated goal was to represent the Algerian people as a major protagonist, and in this he largely succeeds. The film retains sufficient distance to enable viewers to understand the position of the French army bent on crushing the rebellion. The Pentagon showed the film to US officers before their deployment to Iraq.

2          Schindler’s List (1993) Steven Spielberg’s account of the true story of the rescue of 1,000 Polish Jews, based on the novel by Thomas Keneally. It won seven Academy awards and helped stimulate a serious public debate about the Holocaust in Germany. One drawback to the film as a representation of the Holocaust is that it depicts survival. Movies that show the Holocaust without hope, such as The Grey Zone (2001) are too brutal to take in.

3          Sometime in April (2005) This movie, made for HBO by Haitian film maker Raoul Peck, recreates the dynamics of the Rwandan genocide in chilling realistic fashion.  In contrast the better known Hotel Rwanda (2004) avoids confronting the horrors directly, choosing instead to center its story around survivors, and the foreigners trapped in the hotel.

4          Before the Rain (1994). Milcho Manchevski offers an explanation of the Balkan wars through the prism of rival clans (Albanians and Macedonians) with a gripping Romeo and Juliet plot line. Beautifully filmed and with haunting music, it is more effective than other well-meaning films that try to depict the Yugoslav Wars head on, such as Welcome to Sarajevo (1997). It includes a not entirely successful middle section set in London where he tries to show such primal group antagonisms are not unique to the Balkans.

5          Bloody Sunday, (2001). Paul Greengrass’s documentary style reconstruction of the fateful 1972 protest march where paratroops killed 13, triggering the escalation of violence in Northern Ireland. Greengrass focuses on the decisions made by the leaders on both sides as events slide beyond their control. Other impressive films on the Troubles include Omagh, and on the 1920s Irish civil war The Wind that Shakes the Barley (2006) and Michael Collins (1996).

6          Mr and Mrs Iyer (2002) Aparna Sen’s film places a Hindu women and Muslim man together on a bus trip down from the mountains in which they encounter nationalist thugs and indifferent police. A low-key and somewhat sentimental but very humane film.  Deepak Mehta’s Earth (1998) is a powerful account of the 1947 Partition, through the eyes of a Parsi family caught in the middle.

7          The Terrorist (1998). Santosh Sivan, an Indian Tamil, tells the story of the recruitment and dispatch of the 19 year old girl who carries out the 1991 suicide bombing that killed Rajiv Gandhi, on behalf of the Tamil Tigers waging a secessionist war in Sri Lanka. As convincing a depiction of the terrorist mind-set as you are going to find.

8          Skin (2008) Anthony Fabian’s film is based on the true case of Sandra Laing, a girl with African features born to two white Afrikaner parents in 1950s South Africa. Her parents won a court case defining race as based on descent and not appearance, but she was ostracized by white society and eventually disowned by her family.

9          Night of Truth (2004) This film by Fanta Regina Nacro tells of a reconciliation gathering between two warring tribes in an allegorical West African state. Fear and revenge are not so easily dispelled. One of the few indigenous films that try to tackle the nature of bloody ethnic conflict in Africa head on.

10        The Russian Ark (2002) Aleksandr Sokurov’s slow, hypnotic tour of the Hermitage museum come to life is a brilliant essay on how a nation’s history can be compressed into a series of tableaux. It is also the first and as far as I know only movie recorded in a single live take.

If after all that you need some light relief, there is a small set of nationalism-themed comedy films out of the UK, such as Passport to Pimlico (1949); The Englishman Who Went Up a Hill But Came Down a Mountain (1995), and Stone Of Destiny (2008).

Food, nationalism and internet voting

A poll organized by CNN International to select the world’s outstanding food dishes, which has turned into a slugging match between Thais and Indonesians. The Jakarta Post reports with pride that Indonesian dishes Rendang and Nasi Goreng have captured the top two spots, pushing sushi into third place – though Thai dishes occupy four of the top ten positions. Dim sum is #7, Ramen is #8 and Peking Duck is #9. The complete results for the top 50 dishes are listed here in reverse order.  In the first suggested list of top dishes that CNN published back in July, Neapolitan Pizza was ranked #2 and Mexico’s mole poblano #3. But Asian cuisine swept the board when viewers were invited to vote for their favorite dishes through Facebook. Some 35,000 people voted.

Meanwhile, elsewhere on the internet people are voting for their favorite natural wonders. Nova Scotians are logging on en masse to vote for the inclusion of the Bay of Fundy in a list of the Seven New Wonders of the World. Each internet user can only vote once in the poll, but voting by text messaging is unlimited – at a fee of 25 cents per message. You can track the voting trends among the 28 finalists here. The Bay of Fundy is holding its own in sixth place – ahead of Mount Vesuvius but behind the Dead Sea. South Korea’s Jeju Island currently holds the top position, followed by an underground river in the Philippines and the Great Barrier Reef.

The purpose of the project is to promote awareness of nature, and to encourage tourists to explore new sites, but clearly there is a risk that such voting can become overshadowed by nationalist pride. More than 100 million people voted in the first New Wonders project back in 2007, which named seven new man-made wonders of the world: the Taj Mahal, Rio’s Christ, Petra, Chichenitza pyramids, Rome’s Colosseum, the Great Wall of China and Machu Pichu. (The listing is random, they are not officially ranked.) There were surges of voting to promote sites in Latin America and the Middle East, but not all the voting was driven by nationalist pride. Organizer Bernard Weber reports that “More people from Korea and Japan voted for the Eiffel Tower than did people from France.” A last minute flood of votes narrowly failed to raise Mali’s Timbuktu to the final seven. The original seven wonders of the ancient world were chosen by Philon of Byzantium in Athens in 200 BCE.

The classic example of nationalism surfacing in internet polling was back in 2002 when the BBC World Service ran a poll to find the world’s top ten songs of all time. 150,000 listeners voted. The Beatles did not make the cut (although Cher’s ‘Believe’ came in at #8 and Queen’s ‘Bohemian Rhapsody’ at #9.) Top place went to the Irish nationalist ballad ‘A nation once again,’ recorded by the Wolfe Tones. India’s national song ‘Vande Mataram’ narrowly beat out a new pop hit ‘Dil Dil Pakistan’ for second place. Fourth place went to a Bollywood hit and fifth place to a song from a Tamil Tiger film ‘Mugungal.’ An Iraqi song by Kazem Al-Saher came in at #5.

Dis-United Kingdom

A new poll shows that support for the Scottish National Party has risen to 49%, up from the 45% support they earned in the elections back in May 2011 – which gave the SNP a majority in the Scottish parliament for the first time since it was created in 1998. The SNP holds 69 of the 125 seats in the assembly. Support for Liberal Democrats in Scotland has collapsed to 5%,a result of dissatisfaction with their entry into the Tory-led coalition government, while support for Labour has shrunk to 29%, and the Tories 13%. The SNP, led by Alex Salmond, is intent on holding a referendum on full independence for  Scotland. Blogging for the Spectator, Hamish Macdowell notes that “Support for independence is still far below support for the SNP, but has edged up from 35 per cent to about 39 per cent. If the Nationalists can get that figure to anything over 40 per cent then the referendum result is definitely in the balance – if only because committed nationalists are more likely to vote in a referendum than status quo-backing unionists.”

One of the factors holding back the independence movement is the fact that Scotland is still somewhat economically dependent on England. A recent Treasury report stated  that Scots receive £1,600 more in state spending per head than people in England. The Scots receive £10,212 per head as against £8,588 in England, £9,829 in Wales and £10,706 in Northern Ireland. This distribution is a result of the labyrinthine Barnett formula hammered out back in 1978. This means that for example the Scottish Government can afford to waive fees for prescriptions and university tuition. Writing in the Guardian, author Ian Jack argues that in the wake of this summer’s London riots “from the Scottish perspective, England looks a more fractious, turbulent and uncertain society.” Alex Salmond actually complained about one broadcaster describing the riots as having occurred “in the UK”, when in fact they were confined to England.

A number of authors interviewed for the Observer of August 28 likewise argued that support for Scottish independence has more to do with disdain for the corrupt Westminster political elite, and support for the SNP’s progressive policy agenda, than a concern with Scottish ethnicity per se. The one exception is Shena Mackay, who comments that “I want Scotland to be Scottish through and through – I hate to hear English accents in the shops there.” Ironically, Mackay notes that while born in Scotland she has lived in England since her childhood, and herself has an English accent.

Moving across the Irish Sea, In a September 12 blog for the Irish Times, their foreign affairs correspondent Deaglán de Bréadún calls for a wholesale revision of the entire Nationalist project. In a sweeping historical overview, he regrets that both Unionists and Nationalists turned to violence at an early stage – the Ulster Covenant in 1912 and the Easter Uprising in 1916. He argues that by fixating on Britain as the problem the Nationalists failed to reach out to Unionists and assure them that they too had a place in a free and united Ireland. Recent scandals over the Church’s handling of pedophiles and the banking crisis that wrecked the Irish economy have revealed deep flaws in the republic’s political foundations. Bréadún suggests it is time for a fresh approach. It is rare indeed to see nationalists anywhere engage in this sort of critical self-reflection. Bréadún is the author of The Far Side of Revenge: Making Peace in Northern Ireland (Collins, 2008).

Beer and nationalism

For some reason beer commercials have become one of the main vehicles for the representation of national identity, from Canada to Laos. The initiative comes from the beer companies themselves, looking for a way to sell more beer. They seem to operate according to the following logic: Young men drink beer. Young men are nationalist. Therefore: promoting nationalist pride will lead people to drink more beer.
The leading example of beer nationalism is the ad Molson titled “I am Canadian,” launched in 2000. Witty and ironic, “the Rant” became a viral hit in Canada and spawned a stream of imitators, including a Startrek version and “I am not American” from the Arrogant Worms. Molson continued to churn out commercials on the same theme, though they were increasingly crass. In 2005, after Molson’s merger with American brewer Coors, Molson retired the “I am Canadian” slogan. The central theme of the Molson campaign, familiar to scholars of nationalism and Edward Said’s Orientalism, is that Canadian identity is defined in opposition to the American “other.” The theme was picked by other marketing campaigns in Canada, as in this ad by the Japanese automaker Nissan.
Molson’s success was emulated elsewhere, notably by Fosters, the Australian beer giant, in their I Believe campaign. Australia’s Bluetooth beer company took the beer-nationalism theme to a new level. A supporter of the anti-whaling activities of the Sea Shepherd craft, Bluetooth produced this truly disturbing commercial in support of a boycott of Japanese beer.
This Zagorka ad from Bulgaria has folk singers, water nymphs – and football. Over in Laos Beerlao dominates the domestic market with its national-themed ads, some of them aimed at tourists, as discussed in this USA Today article. Many of these national brands, from Tsingtao in China to Quilmes in Argentina – not forgetting Budweiser in the USA – were set up by German emigres in the late 19th and early 20th centuries. The founders of Anheuser-Busch were from Ceske Budejovice in Bohemia: a copyright dispute over use of the town’s name between Budweiser and the Czech Budvar brewery lingers to this day.
The beer-nationalism nexus has attracted the attention of scholars, from marketing experts to students of popular culture. Leanne White analyzed the Fosters campaign in her 2009 article  “Foster’s Lager: from local beer to global icon.” Eliot Brockner writes about the marketing campaign of Quilmes in Argentina, which includes ads targeted on specific regions within the country. Beer is intensely local, since historically it was brewed locally and was difficult to transport out of the home region, until the advent of refrigerated railcars in the 1930s (That was Anheuser-Busch’s key to success, enabling them to create a national market for beer after the repeal of Prohibition.)
There have been two recent books related to this subject:  Beer, Sociability, and Masculinity in South Africa, by Anne Kelk Mager (Indiana University Press 2010) and Sport, Beer, and Gender: Promotional Culture and Contemporary Social Life, by Lawrence A. Wenner and Steven Jackson (eds.) (Peter Lang, 2009), though both are more interested in gender socialization than political nationalism.

Russia’s ruling party trying to join the Internet age

This is a guest note by Oleg Reut, Associate Professor at Petrozavodsk University, who blogs about Russian and international politics at: thelastpageof.livejournal.com

As Russia prepares for the December 2011 State Duma election, the pro-Kremlin United Russia party is trying a variety of new tactics to reverse its declining public support. There is so much distortion in   domestic media and polling that no-one can be sure just what is the public support level for United Russia:  estimates range from 30 to 70 percent.

United Russia has found itself outflanked in the blogosphere by its more agile opponents – most notably blogger Alexei Navalny, who dubbed the ruling party “the party of thieves and crooks”, a term that has now gained wide currency.  (His blog, in Russian can be found here.) Internet activists have carried out several successful campaigns in recent months, targeting extreme right radicals.

Still, enthusiasm about the Internet as a means for driving political activism must be tempered by reality. More than 60 percent of Russia’s 141 million people are not Internet users.  Just 9 percent use the Internet as a source of news and information. On-line news reporting and commentary means nothing to the 70 percent of Russians who rely on the largely state-controlled television to stay informed (a figure that drops to 35 percent in Moscow and in St. Petersburg). They have never heard of the leading political bloggers in Russia, nor of the campaigns that bloggers consider successful.

Will the internet serve to help the struggling opposition parties, shut out of the mainstream media, to build support in the general population? Or will it serve to boost the dominant United Russia at the expense of these other parties?  Maybe the Internet merely replicates the inequalities of the real world, providing smaller parties with no real advantage.

An article in Izvestiya on August 25 (in Russian) shows the efforts that United Russia is investing in the blogosphere, mobilizing “trolls” to push the party line on various blog discussion sites.  As yet United Russia only has 100,000 friends in the leading social network site V Kontakte, while the Communist Party has 70,000. One problem which the party has identified is that party groups in the regions tend to parrot the official agenda from Moscow rather than responding to local grievances. The party’s youth wing Nashi has also been mobilized for the struggle.

Resource nationalism: killing the goose that lays the golden eggs, or a sensible development strategy?

The boom in the price of gold, coming in the wake of a recovery in the price of oil and other commodities, has lead to a renewed discussion of the rise of “resource nationalism.” This refers to governments taking steps to capture more of the rents from the extraction of natural resources – either through taxes and license fees, or by imposing local content requirements, or by taking an ownership stake in extraction projects.
According to a new Ernst and Young (E&Y) report Business Risks Facing Mining and Metals 2011-2012, resource nationalism is now the biggest risk facing international mining companies, up from #9 in 2009. Mike Elliott, global mining and metals leader at Ernst & Young, told The Australian on August 8 that “We have seen more than 25 countries in the last year either change, or announce potential changes to, their fiscal arrangements around mining,”
In a August 22 article on Howestreet.com (“The N-word: Nationalization“), Alena Mikhan and Andrey Dashkova explain that “Because the mining and metals sector rebounded quickly from the global financial crisis, it became an early target to help restore treasury conditions.” Earlier this month President Rafael Correa of Ecuador announced a plan to hike mining royalties from 5% to 8%, while Peru – a leading producer of copper, silver, and tin – raised taxes after leftist President Ollanta Humala came to power at the end of July. Russia has been pursuing a staunch policy of asserting state control over the energy sector under President Vladimir Putin. Most recently, the Russian application to join the World Trade Organization is now reportedly being held up because of Russian insistence on 30% tariffs on auto imports unless the manufacturers meet stringent local content requirements. Even in Australia, a country committed to economic liberalism, there has been a lively debate about whether expanding Chinese ownership in its coal and iron ore deposits poses a strategic threat.
The cardinal example of resource nationalization was the Mexican government’s nationalization of foreign oil companies in 1938. Their example was followed by subsequently followed by Saudi Arabia and all the major oil-producing states. International companies complain that resource nationalism cuts into their profits and deters future investment by adding an unnecessary element of political uncertainty. National governments don’t see why foreign companies should benefit from windfall profits that result from a surge in commodity prices.
Also, some sort of state-led industrial policy is usually necessary to lift countries out of poverty, as noted by respected economist Daniel Rodrik in an August 23 commentary in the Financial Times, “Don’t expect China et al to save the world,” he writes: “Sustained growth, of the type that a handful of countries in Asia have managed to generate, requires more than conventional macroeconomic and openness policies. It requires active policies to promote economic diversification and foster structural change from low-productivity activities.”