The Interactive Investor


The Facets of Nationalism



This picture was voted the British public’s favorite in 2005. “The Fighting Temeraire (1838)” by J.M.W.Turner depicts a hero warship that fought by Nelson’s flagship at Trafalgar (during the Napoleonic wars), being towed up the Thames to be scrapped by a coal-fired tugboat -  the latter signifying the dawn of a new industrial age in Britain. But as the likely highly empirical lecturer at London’s National Gallery notes, “Turner (is) playing a bit fast and loose with the facts…Turner is not here trying to tell us about exactly what happened…Turner is trying to tell us how to feel…he is playing with our emotions…It’s a product of his imagination, and that is OK…” The picture is idealized, not totally accurate, containing “alternative facts.”

1)    The masts of the Temeraire are at full height; in fact, they would be chopped down for this transport.

2)    The ship would have its rigging removed, and taken into inventory.

3)    Most crucially, the setting sun is to the east of the Thames estuary, rather than to the west.

The above is not mere Socratic quibbling. The making of detailed distinctions also results in the many facets of nationalism, which increasingly divide the world and societies. Some of the consequences of these are problematic.

In “Democracy or Autocracy,” we explored in some detail what the primarily economic globalized world order primarily assumes. First, it assumes the availability of actual supply, allocated efficiently by the market. Second, it assumes the irrelevance of national boundaries. To wit, Europe’s energy supplies from Russia were deemed as reliable as supplies from the United States or Canada. However, business alone does not have the resources to enable one to lead a meaningful life. To persist, a social system has to successfully address: economic efficiency, moral appropriateness and national security. It is to moral appropriateness that we now turn.

Describing nationalism, journalist William Pfaff  (1993) wrote, “…nationalism…does not need complicated explanations. Its links to the primordial human attachments to family, clan, and community seem obvious.” 1 Nationalism, as an organizing principle, replaced the easy (or uneasy) sway of empires on communities after W.W. I.

History can also be partly viewed as a chain of actions and reactions. In its first phase, the Enlightenment of the 18th century assumed the rationality of everything. In reaction, the Romanticism and Nationalisms of the 19th century assumed the primacy of the individual or collective will.

 Isaiah Berlin wrote, “…we are still members of some kind of unified tradition, but the field within which we now oscillate freely is far greater than it has ever been before,” 2 weighing consequence against motive.  However, to be clear, the role of government is to produce “justice for all”; this means that the consequential policies of economic growth, climate change and equality (and their compromises) have to substantially fit together because they need to result from agreement. This is what one would mean about “efficient” government, to implement a substantial agreement among political parties about the common destiny.

Given the above, one would expect the nationalisms of specific peoples to be as varied as their histories; and that is indeed the case. Consider the differences between first cousins, British and American democracies. Both British and American democracies have been known for their freedoms. There is, of course, the common heritage. But due to different subsequent historical experience, there are different emphases.

British Democracy

British democracy has not been codified in any single document. Beginning with the Magna Carta of 1215, it exists in a number of acts and documents that, according to the Supreme Court, recognize the constitutional principles of parliamentary sovereignty, the rule of law, democracy, and upholding international law. According to the Wikipedia, “…the constitution (can be) easily changed as no provisions are formally entrenched.” What serves as a major source of political stability is tradition, embodied in the above, and in the monarchy, which reflects the agreements of the general society.

What the tradition values most is individuality. In “The Idea of Nationalism (1961),” Professor Hans Kohn wrote, “In  England, the theory that raison d’etat (reason of state) justifies state action in political and international relations, never took firm hold; all representative thinkers knew government as an ethical activity and the principles of politics as those of morality enlarged….Burke and Bentham regarded the ‘happiness and unhappiness of actual individuals as the final criterium of government.’…Government was a trust, whether based for the conservative thinker upon Christianity –‘a religion which so much hates oppression’…or for the radical thinker on rational benevolence…” 3 This respect making possible the multi-ethnic, multi-cultural society that exists today.

Now consider the most important act in a democracy, the peaceful transfer of power. Due to holding illegal staff parties during the pandemic and caught lying about what the prime minister had known about a staffer’s record of abuse and assault, over 50 ministers and aides subsequently tendered their resignations, thus resulting in the “defenestration” (dumping) of Boris Johnson. Here is how he, somewhat gracefully, left office. In his farewell address he said, “Well, this is it, folks.…In only a couple of hours I will be in Balmoral to see Her Majesty the Queen and the torch will finally be passed to a new Conservative leader. The baton will be handed over in what has unexpectedly turned out to be a relay race - they changed the rules halfway though, but never mind that now.4 Trying desperately to hang on to power to the detriment of government as trusteeship, “Just isn’t done.”

Under the new prime minister, on 9/22 Britain faces a very difficult situation of dramatically soaring energy costs and a weakening economy.

American Democracy

American democracy was born out of revolution, thus the structure of the state and the rights of Americans are codified in a single document, the Constitution. The primary motive was to avoid tyranny, of the majority and of the executive. In Federalist No. 51, Madison 1787 wrote about the rational design of government. “In framing a government which is to be administered by men over men, the great difficulty lies in this: You must first enable the government to controul the governed; and in the next place, oblige it to controul itself….This policy of supplying by opposite and rival interests, the defect of better motives, might be trace through the whole system of human affairs…” 5 The American solution to managing power was to split it up, between the states and the Federal government, and then among the branches of said government.

What the American tradition values the most is freedom, a freedom born out of the Revolution of 1776 and the apparently limitless frontiers beckoning the colonialists of the 13 original states. It used to be said that Americans excelled at the art of government, a task requiring a social trust, resulting from a natural social cooperation. The resource-rich industrial economic system, in addition, provided new opportunities for many, enabling America to grow mightily after the civil war and then to win two world wars.

So what happened? There is a saying ,“liberty is not license.” The basic problem now with one of the U.S. political parties is license, a lack of restraint and balance that makes productive politics, seeing the other side, impossible. This blindness culminated in the violent insurrection of January 6, 2021 on Capitol Hill to impede the electoral vote count. The riot, incited by Donald Trump, who told his followers to “fight like hell”; cost at least seven deaths, 140 police hurt, and some 800 insurrectionists facing charges. 6

Of the 179 countries surveyed by a international organization to track democratization, the United States was one of 33, “to have moved substantially toward autocratization.” 7

In the above, we have noted that there are different kinds of nationalisms, ranging from procedural to the violent. The three major type, also defining “moral appropriateness,” are:

Civic Nationalism

Is a form of inclusive nationalism based the liberal values of freedom, equality and individual rights. This form of nationalism, which is what we hold as well, expresses a pride in the United States as the foundation of the liberal international order comprised of non-coerced independent nation-states.

Chauvinistic Nationalism

Based upon the idea of, “my country, right or wrong.” This exclusive form of nationalism places the national collectivity as the greatest good to which all other elements of society must be subordinate. Due to the inequalities caused by globalization, climate change, the pandeourmic and inflation; the democracies have hit a the very rough patch, for the above violate the broad expectation that the future will be better than the past because of individual initiative. The general purpose of this website is to discuss political economics and markets, in particular how the political system affects the markets and vice-versa. The crucial general point that the markets have neglected the potentially most productive members of our society, we shall delegate to an extended footnote. 7a  This footnote can be expanded by others. But we would just like to note this and to also note that expectations need to somewhat change, but not to the opposite.

Ethnic nationalism also falls under this category. Since Europe started out as a collection of tribes, again to be general: Celts, Franks, Vikings, Catalans, Ligurians, and so on; race does not, in fact, form a stable category.

Totalitarian Nationalism

There is here a clash between a justifying ideology and the nation. The justifying ideologies, whether they be broadly racial or broadly historic “laws,” clash with the idea of the nation, an entity inherently limited; unless…the nation is defined as an expanding empire.

The impulse towards empire is apparently alive and well on the land-locked Eurasian continent, and most unfortunately, for all, in Ukraine. The present war in Ukraine is not new.

As Hans Kohn (1961) writes, “The Russian Empire (of the 18th century) conquered vast territories alien in race and civilization and welded them into a centralized despotism mightier than any other in history. The later Russian Empire differed fundamentally from the liberal, tolerant (commercial) British Empire in its tendency to impose uniformity upon its immense domains, to Russify or later to communize them without any freedom of spontaneous development….(Peter the Great) wished to borrow Europe’s practical efficiency and technical skill, but not her spiritual ideals of liberty and human dignity; and his sole purposes was to strengthen Russia….The reforms did not aim at a new morality, but at providing Russia with the resources to occupy a dominating position in the international world.” 8


This essay notes the difference between business and the national moral order on which all rests. The moral order, itself, also depends on the unique histories of a people, thus the new age “…with its innumerable shadings and transitions…” 9 Or as President Biden said on 9/11/22, “…the push and pull of all that makes us human…”   





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