Depth report

　　

From my business trips to Milan and Amsterdam, if the European Union (EU) is trying to prevent its member economies from going global, it is incapable of doing it. These cities are full of living evidence that proves that Brussels is not the "hand of death" as exaggerated by Euroscepticism. From the good point of view, the EU is a driving force for commercial openness; from the worst point of view, it is irrelevant.

    For all wealthy regions, the complex relationship is (or should be) their relationship with the country in which they are located. It is the nation-states that tax their output and then transfer these fiscal revenues to other regions. It is the nation-states that can use the absolute power of votes to take actions that are not in their interests. Ask a Londoner. In contrast, although the EU has various supranational claims, it does not require them to make any contribution.

    So why didn't there be more Catalonia? Or more Veneto and Lombardy (the two regions of Italy that voted for greater autonomy last Sunday)? Will there be more in the future? Catalans have a stronger sense of national identity than the population of most regions, but other raw materials of separatist sentiment (seems to include economic self-reliance and historical experience of autonomy) exist in urban areas in Europe and elsewhere.

    In the past few decades, the substantial gap between cities and the deindustrial inland zone has become the most intractable fault line within Western democracies. Look at the map of voters for Donald Trump in the US, Marine Le Pen in France, or Brexit. But the real trouble begins when we only look at this imbalance through the perspective of those lagging regions, thinking that we can use infrastructure projects, industrial protection, and new cultural sensitivity to treat conservatively inclined rural areas to remedy it.

    As a moral proposition, this is correct: first take care of the disadvantaged. As an interpretation of how politics will develop and evolve over time, this may turn the cart before the horse. The anger that the poor rural areas feel at the fast-growing metropolis—the Pas-de-Calais area’s anger at Paris, the Indiana’s anger at New York—may ultimately be less weighty than the anger in the opposite direction. According to the latter version, the future situation will be that urban residents feel injustice. They feel that their surplus output is free-ridden by rural areas, but they are given the upper hand by uncivilized voters in those areas when they vote. (It might as well call it "no tax but representation.") The governments of nation-states have found that it has become more difficult to collect taxes from one region to subsidize another region. Localist movements have arisen, demanding greater and greater autonomy, if not for formal independence.

    If there is no ethnic homogeneity, what defines a country will be an automatic fiscal stabilization mechanism. The concept of the state is nothing more than that rich regions are naturally willing to subsidize other regions. If this willingness disappears, the country will become nominal.

    Will it be like this? If there is anything that characterizes today’s conservatives—such as President Trump’s former adviser Steve Bannon or the people who brought you Brexit—it’s a habit: When they talked about nation-states, it was as if it were a non-negotiable constant in the long history of history, rather than a product of improvisation in recent centuries. They exude the atmosphere of a nouveau riche, and always read the tradition to a simulated Tudor palace. The history of the country is too short to deserve this eternal assumption. Before the state appeared in the welfare state, financial transfers between regions were too small to be a burden on anyone. Countries have also appeared before the global economy, and it is the knowledge and capital gathered in cities, not land and industry, that generate returns in the global economy. It is peculiar that the concept of the state has not yet withstood the test of the modern world.