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Harold James

Articles by Harold James

The Clash of Cultures

15 days ago

Politics nowadays is driven almost entirely by culture wars – zero-sum clashes that feed on tribal identities, fear, and a chaotic confusion of basic terms and ideas. To solve any of today’s most pressing problems, we will first need to improve our collective intellectual hygiene.

PRINCETON – The political scientist Samuel Huntington’s famous thesis that the post-Cold War world would be defined by a “clash of civilizations” turned out to be off the mark. While there certainly is cleavage and conflict, the cause is a clash of cultures within civilizations. It is this clash that fueled the assault on the United States Capitol on January 6, 2021.
January 6 and the Possessive White Male

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Multilateralism’s Secret Sauce

December 3, 2021

Historically, successes like the 1944 Bretton Woods Conference have been much rarer than international gatherings that produce either inaction or recrimination. The key is to focus on what can be measured, rather than on whom to blame.

PRINCETON – One clear lesson from last month’s damp squib of a climate summit in Glasgow is that multilateralism is difficult to pull off. This has always been the case. Many of history’s biggest international pow-wows ended in failure, not least the 1919 Paris Peace Conference, the 1933 London World Economic Conference, and pretty much every G7 or G20 meeting. Big successes like the 1944 Bretton Woods Conference and the April 2009 G20 meeting in London were exceptions that prove the

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Back to Austerity?

November 3, 2021

For every burst of euphoria about the potential of government spending, there is an inevitable reversion to fiscal consolidation and tighter restrictions. If the public is demanding an expansion of the state, the task for policymakers is to determine not how much to spend, but how best to spend it while the opportunity lasts.

PRINCETON – Economic and financial policymaking tends to move like a pendulum. Euphoria about the potential of government action is usually followed by backlash, disillusion, and lowered ambitions. “Can-do” rhetoric gives way to “mustn’t-do” restrictions and rules. That is where many advanced economies are now: After a period of feelgood spending, there is growing pushback against government

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The Janus of Debt

October 8, 2021

With the US again flirting with a default crisis as Republicans balk at raising the national debt ceiling, and with government debt levels everywhere reaching new highs following COVID-19, questions about the proper role of debt have returned. The truth seems to be that sustainability of government borrowing is as much about politics as economics.

Markus K. Brunnermeier, The Resilient Society, Endeavor Literary Press, 2021.Barry Eichengreen, Asmaa El-Ganainy, Rui Esteves, and Kris James Mitchener, In Defense of Public Debt, Oxford University Press, 2021.Ludger Schuknecht, Public Spending and the Role of the State: History, Performance, Risk and Remedies, Cambridge University Press, 2020.Tobias Straumann, 1931: Debt,

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Germany’s Europeanized Malaise

September 27, 2021

Although the 2021 German federal election has put an end to the country’s long-standing two-party dispensation, that doesn’t mean it has inaugurated a new era of change. On the contrary, Germans are still hewing to the center, but will now be subjected to a protracted, opaque negotiation process.

PRINCETON – The razor-thin outcome of the German election marks a watershed in the history of the Federal Republic, signaling the final disintegration of the near-two-party system that long characterized the politics of West Germany and then of reunified Germany after 1990.
How Olaf Scholz Won Germany

Clemens Bilan/Pool/Getty Images

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Monetary Order and International Security

September 2, 2021

Historically, there have long been close parallels between the collapse of monetary systems and the fall of global security orders. Hegemony requires a sound financial basis and global credibility – assets that can evaporate much faster than anyone in power cares to admit.

PRINCETON – This year includes big anniversaries in the history of the international monetary order. August 15 marked 50 years since US President Richard Nixon “closed the gold window”; and on September 21, it will have been 90 years since the British government took the pound off the gold standard. Although both episodes belong to the history of money, their implications transcended the financial domain. Each marked the passing of an entire

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A Digital Nixon Shock?

July 30, 2021

US President Richard Nixon’s 1971 decision to end the US dollar’s convertibility into gold had such far-reaching consequences that it took policymakers decades to learn to manage the new system. Now, digital technologies are driving a new monetary revolution that could end the greenback’s global primacy altogether.

PRINCETON – We are approaching the 50th anniversary of the so-called Nixon Shock, one the most decisive ruptures in monetary history. On August 15, 1971, US President Richard Nixon announced in a televised address that he was “closing the gold window.” By ending the dollar’s convertibility into gold (at an official rate of $35 per ounce), Nixon severed the millennia-long link between money and precious

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A Little Geopolitics Is a Dangerous Thing

June 29, 2021

The term geopolitics first came into vogue after Germany’s defeat in World War I and has since come to be used as a rationalization for zero-sum conflicts. But insofar as it represents a false notion of geographical determinism, it is utterly inappropriate for a globalized world.

PRINCETON – Any hope that Donald Trump’s messy departure from the White House would at least restore a modicum of calm to the world must now be discounted. Already, there is a dangerous new international threat: the return of “geopolitics” in shaping international security.
The Death of Free Speech in Hong Kong

Bertha Wang/AFP via Getty Images


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Good Inflation

June 2, 2021

Economic horror stories from the Great Depression and the 1970s can offer useful lessons, but they are no longer appropriate for today’s world. In a world undergoing radical economic, technological, and climatic change, we must recognize that not all price increases are the same, and that some are desirable – and even necessary.

PRINCETON – In response to recent concerns about resurgent inflation, US policymakers deny that there is any threat and insist that expectations are “well anchored.” Any recent price spikes, they argue, will prove temporary, arising from one-off shortages that will be resolved when life returns to normal after the pandemic. Nonetheless, market participants and investors are increasingly obsessed with the

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Machiavelli in the Ruins of Greensill Capital

May 5, 2021

The collapse of Greensill Capital has a strong historical parallel in the decline and fall of the medieval Medici bank after it went too far with the financial innovations of its own day. The lessons from both failures are clear, but most likely will be forgotten until the next financial meltdown.

PRINCETON – The collapse of Greensill Capital, a London-based financial services firm, offers a timely but costly warning about a number of contemporary trends. Clearly, we should be wary of the hype around financial innovation. But we also need to shine a brighter spotlight on the shady world of corporate lobbying, the regulation of risk, and other issues at the intersection of capitalism and government.


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All Apologies for Democracy

March 30, 2021

Recent mistakes by elected governments underscore the unique difficulties that democracies face when dealing with a problem as large and complex as a pandemic. Nonetheless, the COVID-19 crisis has offered clear lessons, validating two classic answers to the question of what role the state should fill.

BERLIN – German Chancellor Angela Merkel’s hasty revocation of a hastily announced Easter lockdown was surprising, even shocking, given her ever-calm demeanor. Even more extraordinary was the apology she issued to parliament: “The mistake is mine and mine alone. Because in the end, I bear responsibility as chancellor. I regret it deeply, and I ask our citizens for forgiveness.”

The End of the Oil Age

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Who’s Right on Inflation?

March 1, 2021

As in the 1970s, a severe economic shock has forced governments to pursue massive fiscal and monetary expansion, thereby sowing fears of future inflation. But not all shocks are the same, and the key question now is whether we can be confident that the current state of exception will end.

PRINCETON/PARIS – The specter of inflation has returned. For two decades, central banks across industrialized economies were confident that they had banished it for good. Then came the 2008 financial crisis, which occasioned a brief return of inflation anxiety on both sides of the Atlantic. In the United States, congressional Republicans ushered in austerity in 2010, and the European Central Bank started tightening its interest-rate

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What’s in a War?

February 4, 2021

Channeling the spirit of America’s entry into World War II, President Joe Biden has promised a mass mobilization of people and resources to tackle the COVID-19 pandemic. But if defeating a virus is like waging a war, several important historical lessons and caveats should be kept in mind.

PRINCETON – US President Joe Biden started his term with a beautifully crafted speech that caught the spirit of a country exhausted by Trumpism and COVID-19. Biden has promised a “full-scale, wartime effort” against the pandemic. But hasn’t our tired world already been in the trenches for a year now?

Multilateral Cooperation for Global Recovery

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The Pandemic’s Big Sort

January 4, 2021

As with every global crisis, the race is on to determine which political systems will emerge stronger from the pandemic, and which will be discredited by their response to it. But if the past is any guide, it is too early to make such judgements, because the real test for competing systems is yet to come.

PRINCETON – Political systems live on competition. Political incumbents and aspirants are constantly claiming that they can manage problems better than their rivals can. Modern wars of ideas, political projects, and systems of organization are merely updated versions of older forms of combat.

How Might COVID-19 Change the World?

PS OnPoint

STR/AFP via Getty Images

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The Financial Equivalent of a Vaccine

December 1, 2020

While the advanced economies can rely on their central banks to support massive fiscal stimulus in response to the COVID-19 crisis, many developing countries’ hands are tied by higher borrowing costs. This is both unfair and unsustainable, pointing to the need for a new, truly global monetary mechanism.

PRINCETON – COVID-19 is dramatically widening a global divide that was evident long before the current crisis. Only some countries have been able to cover the costs of the pandemic and lockdowns with large fiscal measures, owing to support from central banks that are buying up large quantities of government debt. Most other countries are facing rising borrowing costs and thus cannot afford a robust fiscal response. Indeed,

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Capitalists and Socialists of the World, Unite!

October 1, 2020

Although it can be politically expedient to draw a thick line between capitalist decentralization and socialist central planning, the truth is that these two systems have converged on many occasions. Moreover, each was conceived for the same purpose, and elements of both could be realized in today’s digital economy.

PRINCETON – The world’s most dynamic economy is governed by a communist party, whereas its previous capitalist stronghold is under the misrule of a man whose companies have gone bankrupt six times. With leading political ideologies becoming increasingly incoherent, labels seem to mean little anymore.

The Way We Could Live Now

PS OnPoint

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What Next for Great Cities?

September 1, 2020

In the era of COVID-19, megacities that lack competent management are bound to share the same fate as the great cities of the past. But competent management means addressing not just the virus but also deeper sources of malaise such as poverty and unaffordable housing.

PRINCETON – Has COVID-19 killed the megacity? The pandemic certainly is reshaping globalization, turning the hubs of the pre-2020 global economy into epicenters of contagion and leaving their future hanging in the balance. But the crisis also has simply highlighted megacities’ existing vulnerabilities and accelerated processes that were already underway.

The Post-Pandemic Economy’s Barriers to Growth

PS OnPoint

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No Europe Without the Rule of Law

July 30, 2020

In typical fashion, the European Union has once again taken a step toward deeper integration in response to a catastrophic crisis. And, once again, "ever-closer union" is being embraced in the absence of effective mechanisms to enforce fundamental principles, setting the stage for more internal disputes to come.

PRINCETON – The European Council’s five-day meeting to hash out a 2021-2027 budget and a COVID-19 emergency spending package had all the hallmarks of Euro-summitry: long nighttime discussions; threats by some leaders to leave without an agreement; and a Franco-German push for a deal. Naturally, it all concluded with an unsatisfactory compromise.

From American to European

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Late Soviet America

July 1, 2020

Like the Soviet Union in its final years, the United States is reeling from catastrophic failures of leadership and long-suppressed socioeconomic tensions that have finally boiled over. For the rest of the world, the most important development is that the hegemony of the US dollar may finally be coming to an end.

PRINCETON – The Soviet Union was fertile ground for political jokes, which featured as prominently in the culture as late-night comedy does in the United States. According to one popular story, a young man who shouted in Red Square that the decrepit Soviet leader Leonid Brezhnev was an idiot ended up being sentenced to 25.5 years in prison – six months for insulting the Chairman of the Presidium of the

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The Prehistory of Merkel’s Latest Coup

June 1, 2020

German Chancellor Angela Merkel seems to see the historical writing on the wall. Her agreement to a €500 billion European recovery fund suggests that the COVID-19 pandemic has done what recent debt, refugee, and foreign-policy crises could not: inaugurate a new phase of the European project.

PRINCETON – Throughout her long chancellorship in Germany, Angela Merkel has repeatedly shown that she is good for a surprise. Now, she’s outdone herself.

America’s Mis-Police State

Stephen Maturen/Getty Images

The Lonesome Death of Hong Kong

PS OnPoint


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The Day After Tomorrow

May 5, 2020

As in the interwar period, the COVID-19 pandemic will confront policymakers with the unenviable task of deciding when to declare the emergency over, and how to distribute the costs. The lesson from history is that the longer this debate is avoided, the worse the outcome will be for everyone.

PRINCETON – When (and how) to end the COVID-19 lockdown has become the leading political question in every afflicted country. German Chancellor Angela Merkel has gone so far as to describe the increasingly intense debate as a collection of “discussion orgies.”

How Will the Great Cessation End?

PS OnPoint

Olivier Douliery/AFP via Getty Images

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A Pandemic of Deglobalization?

February 28, 2020

At this stage, there is no telling how bad the COVID-19 epidemic will become before the contagion subsides or an effective, widely available vaccine is rolled out. In any case, we should not be surprised if the crisis leads to far-reaching, historically significant global change.

PRINCETON – The outbreak of the new coronavirus, COVID-19, that began in Wuhan, China, may well turn into a global pandemic. Nearly 50 countries have confirmed cases of the virus, with the precise nature of the transmission mechanism remaining unclear.
Solidarity Now

PS OnPoint

Spencer Platt/Getty Images

When China Sneezes

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Money and Empire

February 14, 2020

Although British imperialists often told themselves that by taking over the public administration of China and the Indian subcontinent, they would bring those civilizations into the modern age, the reality was altogether different. Two histories of Pax Britannica make clear that economic exploitation was always the top priority.

PRINCETON – Centuries are usually analyzed with reference to the great powers that dominated them. The nineteenth century was the era of Pax Britannica, although most people now realize that the “pax” in that case was not particularly peaceful. The twentieth century became the American Century, as heralded in Henry Luce’s February 1941 editorial in Life magazine. And the current century, one often hears,

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The United Kingdom’s Paradise Lost

January 31, 2020

In imagining a post-Brexit future, UK Prime Minister Boris Johnson’s government is acting as if it is entering a world of new, attractive alternatives from which to choose. But today’s Conservatives seem to have forgotten what their forebear, Margaret Thatcher, always understood: there will be tradeoffs.

PRINCETON – Goodbye, Britain. Brexit is done. It’s over. Some Britons are waving Union Jacks, and public buildings are illuminated in red, white, and blue. Having dramatically opened up a new space for political maneuver, the country is now celebrating its achievement.
Can Sanders Do it?

PS OnPoint

Ralph Freso/Getty Images

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Loser Teens

December 27, 2019

In keeping with the adage that history does not repeat but rhymes, the decade from 2010 to 2020 ushered in a new age of disorder and distrust, just as the 1810s and 1910s did. Each era shows how unmet promises and unrealized hopes inevitably lead to disillusion and cynicism.

PRINCETON – We are at the end of a decade that has no name. The 2010s cannot really talk about itself, and this confusion is only partly born of semantics. While the term “noughties” was applied to the first decade of the twenty-first century, few would be comfortable calling this past decade the “teenies.” A century ago, there was no need to worry about such categorization: the 1910s were simply the era of the Great War.
How Truth

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What’s Behind the Crisis of Democracy?

December 4, 2019

In democracies around the world, voters increasingly feel as though most of the major choices affecting their lives have already been decided through existing legal and international frameworks. But while rules-based technocracy – and corporatism before it – may have been well-suited to monolithic forms of identity, it no longer suffices.

PRINCETON – There is no longer any denying that democracy is at risk worldwide. Many people doubt that democracy is working for them, or that it is working properly at all. Elections don’t seem to yield real-world results, other than to deepen existing political and social fissures. The crisis of democracy is largely a crisis of representation – or, to be more precise, an absence of

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The New Anti-Capitalism

November 6, 2019

It should not be surprising that our era of rapid technological change has coincided with renewed skepticism of capitalism across Western countries. Yet this time is different, not least because of the rise of winner-take-all markets and a shift in the geographic center of the global economy.

PRINCETON – We are currently living through the most dramatic technological and economic transformation in the history of mankind. We are also witnessing declining support for capitalism around the world. Are these two trends connected, and if so, how?
The End of Neoliberalism and the Rebirth of History

DNY59/Getty Images

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The Death of Anglo-American Conservatism

September 27, 2019

The conservatism of Edmund Burke has long served as a source of frustration for radicals, and as a necessary restraint against destructive root-and-branch reforms. But now the top elected representatives of conservatism in the United States and the United Kingdom have embraced radicalism themselves.

PRINCETON – In remarkably similar ways and almost at the exact same time, US President Donald Trump and Brexit have destroyed transatlantic conservatism. Yet while American conservatism has always had rather shallow roots, British conservativism is the product of a long and rich intellectual tradition, which makes its demise all the more astonishing.
The Constitution Won’t Save American Democracy

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Money for Nothing

September 4, 2019

The persistence of low inflation across advanced economies has led central banks into the realm of zero and even negative policy rates, with the result that government borrowing (and thus spending) is now free. Populist politicians find themselves right at home, while those warning that there is no free lunch will be ignored – until it is too late.

MUNICH – A monetary-policy regime centered on quantitative easing (QE) and zero or even negative interest rates has created an extraordinarily permissive environment for politicians of a certain disposition. Those who are willing to exploit current conditions to boost their own popularity can expect clear sailing ahead – at least for now.

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Locating Equality

August 5, 2019

For years, wealth and income inequalities have been rising within industrialized countries, kicking off a broader debate about technology and globalization. But at the heart of the issue is a fundamental good that has been driving social and economic inequality for centuries: real estate.

MUNICH – Inequality is the leading political and economic issue of the current era, yet debates about it have long suffered from a degree of imprecision. For example, the standard measure of inequality, the Gini coefficient, reduces a country’s entire income distribution to a single number between zero and one, and is thus highly abstract. Similarly, while inequality is rising in many parts of the world, there is no

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