Responsible Nationalism: A Quiz

Responsible nationalism: “The idea that the basic responsibility of government is to maximize the welfare of citizens, not to pursue some abstract concept of the global good. Closely related to this is the idea that people want to feel that they are shaping the societies in which they live” (Larry Summers).

Now that as central a figure in the establishment as Larry Summers has made it respectable to be a “responsible nationalist,” I think it’s time to start delineating the boundaries that would allow a person to be classified as such. So here are a couple of examples that can help us decide if we are a responsible nationalist or a “protectionist-xenophobe.”

Scenario 1: The United States is considering a new trade deal. The increased flow of cheaper goods from that deal will inevitably destroy entire industries in many small towns across the poor South. Most Americans employed outside the targeted industries would end up being better off because they could buy more of those goods at a cheaper price. The well-being of the unemployed Southern workers, many of whom are minorities, would clearly suffer because few new industries would come in to replace the old jobs. Moreover, the loss of jobs spills over into the entire social and economic infrastructure of the affected towns, and numerous harmful and very costly pathologies become part of daily life  (e.g., substance abuse, welfare dependency). Would opposing such a trade deal because of the harmful consequences on a specific group of people in a specific region make one a responsible nationalist? Or a die-hard protectionist?

Scenario 2: A new political upheaval convulses the Middle East, sending millions of Islamic refugees into the industrialized world. Practically all of those refugees want nothing but to escape the turmoil and live their lives in peace. A small number, however, feel very strongly about their cultural traditions, and want to export them to the receiving countries, or bring grudges and conflicts they wish to rekindle in their new homes as part of a continuing war. The United States wants to help and is willing to accept 1 million such refugees. It is impossible to vet each individual refugee separately to filter out the few who would create the cultural and political clashes, but security experts tell us that 1 percent, or 10,000 refugees, could be potentially problematic. It’s just very hard to tell which specific refugee is in that group. Would opposing the entry of the million refugees make one a responsible nationalist? Or a die-hard xenophobe and Islamophobe?

The point of these two scenarios is to illustrate the obvious. Responsible nationalism is a very sensible concept, but the devil lies in the details. Just how much of a cost does globalization need to impose before we are allowed to start cheering for the home team?

Some context: Much of Scenario 1 is familiar to anyone who knows their micro theory.  The basic trade model tells us that the size of the economic pie–the aggregate wealth of the United States–will increase as a result of the new trade deal, but that the split of the pie will be different, so that there are winners and losers. But, and this is a very big “but”, the wealth increase accruing to those who win exceeds the wealth losses suffered by the losers. In principle, therefore, wealth could be redistributed so as to make everyone better off. Such redistributions, of course, never actually takes place in real life, which is why we are now discussing “responsible nationalism” even in the context of trade. The problem posed by Scenario 2 is much harder. It is far from clear that the actual size of the aggregate economic pie has increased after 1 million refugees are admitted. It could plausibly be argued that the costs associated with the entry of the security risks are so large that they would offset whatever economic gains the other 99% of the refugees generate.

Author: George Borjas

I am a Professor of Economics and Social Policy at the Harvard Kennedy School.