John Gray Lecture

John Gray
Professor of European Thought
London School of Economics
April 18, 2002

It's a great privilege, as well as great honor to try and shed some light, some thought, on the world as it appears after September the 11th, 2001. But my first point really is that what September the 11th did was to illuminate the kind of world we were living in for some time. September the 11th, as I understand it, was not caused by problems of globalization or global capitalism. Those who committed the acts which we now refer to as September the 11th, did not do so, it seems to me, as a result of particular problems or defects or difficulties in globalization, nor did they express any critique of American society or economy. They embodied the opening shot of a new kind of warfare whose goals had to do actually with America, but more centrally and immediately with the Middle East. I'll come back to that shortly. But I want to do really today is to ask what kinds of features of the world, neglected in the 1990s, made September, the events of September the 11th possible? What features of the world actually did it illuminate? What kind of world will we live in over the next decade, over the next few decades, over the next generation; what kind of world will you need to make sense of [in order] to achieve your goals? What kind of risks, what kinds of hazards, what kind of opportunities and possibilities will you face?

...I say this ... out of a central conviction of mine, which is that first task we all have, which is also the hardest task, is to understand the present. It's easy to speculate about the future. It's easy to pontificate about the past. But it's immensely difficult and challenging to actually understand the present. I actually do think that no one really understands, yet, the set of events that brought about September the 11th, or indeed, it's results, but I'm going to give it a shot. I'm going to try and point to three aspects of the world, three features, three processes, three types of development in the world which lie behind those events [of] September, 2001, and which I think will be with us in the foreseeable future.

First of all, I'll talk a little bit about this new kind of war which I fear has broken out. Second ... I'll talk about the way in which this new type of war has affected globalization and is producing what I think will be the principal source of conflict in the next 20 or 30 years, which will be conflict generated not by 20th Century political ideologies such as communism, or liberalism, or fascism, or democracy, but sadly conflict over natural resources.

One of the things I think we're learning now, it was clear before September the 11th, is that contrary to what many economists have argued, contrary to what many conservatives have argued, the world is actually composed of scarce resources. Some resources really are radically finite. The amount of oil in the world is finite. I think that the economic model according to which, so long as we have a kind of combination of marketing pricing and new technologies, all the scarcities in the world that actually exist can be overcome or dealt with, has been shown to be illusory in the sense that even if it could work in some infinitely long run, in the real world in which we actually live, a world composed of human beings, histories, allegiances, enmities, religions, cultural traditions, in that real world, when scarcities become acute, institutions of market pricing are swept away. When scarcities become acute or urgent, what happens is people seek to resolve, seek to satisfy their most urgent needs, their most vital needs in ways which involve revolution, dictatorship, or war. And in fact, I think one of the most important things I think should be kept in mind at this start of this new century, is that many of the conflicts which are now taking place in the world have an important environmental dimension. The conflict in the Middle East now has deep roots in history. But it's also partly a conflict about water, about the control of water. The last big genocide of the 20th Century in Rwanda had many causes, including some of the deformations of tribal life in Rwanda under the colonial period. But it, too, turned into a conflict about control of water. The last large war of the 20th Century ... the Gulf War, was at least partly about oil.

So one of risks I want to draw your attention to is the risk that in the world we're now moving, we won't have the great wars or great conflicts of the 20th Century, which were, at least ostensibly about economic systems and political ideologies. I think all those wars are pretty well over. We won't see war like that in the foreseeable future.

But what we may very well see, because we've already seen versions of these, are wars in which resource scarcity interacts with deep historical conflicts of an ethnic and religious kind. I think the challenge for anyone who believes that some principles of justice and equality can be embodied on a global scale is to try and think how these conflicts can be moderated, contained, resolved, or alleviated, not, I fear, removed, because they're very deeply seated. Many of the kinds of institutions and policies which have been advocated over the last ten or 20 years for removing resource scarcities have not worked. Some policies, at least in my view, have even made the situation worse than it needed to have been.

The chief thing I would like to see given up, and which I think is actually unraveling now, is the idea that if the whole world could be turned into something resembling a free market. If the whole world could be reconstituted on the model of the free markets that existed in a couple of western countries, United States, England, one or two others in the 19th Century, and then later in a different form in the '80s and '90s of the 20th Century. If the whole world could as it were be made over into that kind of model, then these problems could be circumvented, could be over come, could be removed. I've already given you one reason why I think this [claim] not true. One reason why it's not true is that even if it's true in the very long run, that market pricing and technological inventiveness will enable human kind to overcome scarcity, in the short run of a generation, of two generations, people, human beings are unwilling to entrust their own futures, their own lives and those of their children, their offspring, to what they see as the hypothesis or the gamble that invention and market pricing, new technology and market forces will enable them to always stay one step ahead of scarcity.

One can see this happening right throughout the world now. It's not only in what's happening in what I regarded as poor countries, in Africa or the Middle East or elsewhere. The world's great powers, the European powers, the United States, China and Japan have revived what was called, as those of you historians will know, it was called at the end of the 19th Century, the Great Game. The world's great powers are in central Asia now. They're interested in securing access to the oil and natural resources of Central Asia. They're interested in doing that partly because the Middle East has become so intractably conflicted, partly because it's become a dangerously unstable area. This is a situation which was predictable, which in the first edition of my book (published in March 1998, but written in 1996) I thought it was likely that the Great Game, that this kind of great power competition for natural resources would occur. And it has occurred. That's no special tribute to my powers of prediction. I think what it shows is the illusoriness, the unreality of economic models which treat human beings as if they were rational choosers, treat human beings as if they're governed by some conception of enlightenment and enlightened self interest. But .. we ... are all historical creatures with needs, passions, children, parents, religions, streets that we're fond of, memories, languages; infinitely more complicated, and infinitely more intractable than the economic model suggests.

So, useful as economics is, and I have to say this, of course, since I'm sure many of you are economists, and have achieved a great deal in terms of economic understanding, and understanding the world, I caution you against imagining that the models, economic models, of economic life actually will enable you to understand its deeper movements. Keynes, the great British economist said somewhere, he said, "The market can remain irrational longer than any of us can remain solvent." [Keynes' quip, though] applied to investing, has much more urgent and deep and vital implications in many other areas of life. It's simply an illusion to think that the conflicts over resources, the conflicts of a territory, the conflicts over ethnicity, the conflicts over religion, which have recurred throughout history can be resolved by turning the world into a global free market.

First of all, [the free market] project is ... utopian. It's utopian in my view in exactly the same way, it has a great deal in common in fact with the kind of communist utopias that were projected in the 19th Century and this embodied to some extent for much of the 20th Century. The idea there was that human beings would shed their particular identities; they would overcome nationalism and religion, which would fade away. History would end. Professor Fukyama argued and is still arguing, I think he's argued that history has ended, not that many of us have noticed that. But anyway, he's arguing that history has ended. There's only one type of regime which is now perceived as being, one type of government, one type system is perceived as being legitimate, what he calls democratic capitalism.

The second point I want to make to you is this. I don't know whether I can any longer be regarded as a conservative, but I think this is a point which conservatives at least used to make, [about] what we all want, what human beings want from their governments now is what they've always wanted. What have they wanted? I suggest we've all wanted three things. The first is protection from physical violence, protection against a state of being at risk from other human beings. The second is a modicum of economic security. The third is respect and recognition for their identities and ways of life and culture traditions. These are what I think those three basic and human needs are; whether these needs are met are still what make regimes or governments legitimate or illegitimate. The important point is that I've said nothing about whether they're democratic or not. Let me mention an anecdote. I had a conversation with a Chinese scholar recently, a woman. I asked her what were the three main problems facing China. She said, water, pollution and population. She didn't mention democracy or human rights. Does that mean she's indifferent to democracy and human rights? No. I don't think so. But what it means is that the precondition in her view for human advance, legitimate government in China was that these problems be grappled with. If these conditions are not grappled with, if the deserts continue to grow, if destruction of the environment continues to go on, if there's no balance between human needs and scarce natural resources, whatever else might be achieved in China would be, in her eyes, would be forfeit, would actually be a risk, ... wouldn't be achieved at all.

So the second thing I'd like to say today and stress today is that the idea which Professor Fukyama and others have argued - that we now have in the world and set of institutions, which he calls democratic capitalism, which somehow resolves these ancient, and difficult, and familiar, painful human dilemmas – is a myth. It's not the case that everyone in the world wants the same type of government, democratic capitalism regards only democratic capitalism. That is not the case. What people look to, it seems to me, everywhere in the world, are governments which meet these vital human needs I mentioned earlier. A modicum of security from violence, a modicum of economic security, and respect for their traditions, their identities, and their distinctive values.

Now, how does this connect up with September the 11th? Well, one very important feature of the world, which was evident from the start of the '90s, if not earlier, but which were not paid much attention to, and still is not paid much attention to, but which partly explains how September the 11th could have happened is that in many parts of the world, effective modern states no longer exist. If you look at the map, if you look at different parts of the globe, you'll find that in parts of Europe (for example, Albania, Georgia, Chechnya, parts of the Balkans, parts of the former Yugoslavia), in parts of Africa, in parts of post-Communist Russia, in parts of southern Asia (Pakistan, and of course, Afghanistan) there's nothing resembling a modern state. My view is that this new reality has really been neglected by thinkers, by economists, by political theorists, by ethicists and others, because during the 20th Century, it was true that the very worst assaults on human rights, the very worst assaults on human well being were committed by states, powerful states; [Indeed, these abuses] are only possible as a result of the existence of powerful states. If we think of the Holocaust, if we think of the gulag, if we think of the worst wars of the 20th Century, they were all basically these terrible assaults on human well being, were not possible unless you had a modern state. Without the modern state's capacity for surveillance, tracking people, moving them around, herding them into camps, they couldn't have been these great, great crimes against humanity.

So, liberal thought, and what passes for conservative thought, thought of the left and the right really became, I think, obsessed with the state as the chief enemy of human freedom. And it was reasonable to be, to have this concern in the 20th Century. But as I mentioned earlier, if we think about the last decade of the 20th Century, we're already beginning to see that it's no longer true that the chief obstacle to human freedom, human rights, human well being is the state. The massacre in Rwanda occurred in the context in which there wasn't much of a state left. The massacres that have occurred in Europe, quite large massacres, amounting to hundreds part of thousands of people actually in places like Yugoslavia, or in parts of former Soviet Central Asia, mounting to hundreds of thousand of people, not being committed by states, but by irregular militias of armies, which no state controls.

One of the key things that's happened is ... that the terrorism that occurred around September the 11th, occurred against the background of regimes in countries where the state had collapsed. The Taliban regime in Afghanistan was not a modern state; it was not a state in a modern sense at all. The Taliban was a comparatively weak regime which arose against the background of the collapse of the state. There are large numbers of countries in the world, also in Latin America, as I mentioned in Europe and parts of Asia, where essentially the state controls very little of what goes on, doesn't control organized violence, doesn't even control most of the capital city. It controls very little.

So one of the illusions, I think, which needs to be faced up to is the idea that by changing regimes in states, by removing regimes, you thereby remove the causes of terrorism. If the government controls very little in a country, and the reason that it controls very little is that the state itself is extremely weak, or almost non-existent, replacing one government or one regime by another regime will have very little effect. ... As far as we know, those who perpetrated the crimes of September 11 (at least this is the European view, and the British view) were not controlled by any state. They may have been sponsored by states; they may have been helped by states; they have been, to some extent, sheltered by states, but they're not controlled by any states. They operate outside all states taking advantage of the weakness of the state, which is a dominant feature of globalization in the last ten or 15 year or so ... In that sense, that kind of globalized non-state violence, that kind of, you might almost say, privatized terrorism on a global scale is an aspect of the dark side of globalization. It's an aspect of a world in which the state is weak. Up to 1989, much of the world continued to be controlled by totalitarian states, or strong dictatorial states, repressive states. It's only really in the last decade or so that we've had the conjunction of a high degree of globalization, which means a high degree of mobility, both of capital and information and people, with failed states in various parts of the world.

Now, I just to add something to this observation about the dangers of a world with weak states, but it involves a large shift in thought. If you're interested, as I think we all must be, in promoting freedom and justice in our present circumstances, it's a mistake, it seems to me, to treat the state always as the enemy. If you live in a country where the state doesn't exist, or is weak, or is fragmented, you won't think of your problems in that way, especially since human needs in the long run always prevail, since human needs for security and for protection against violence and for recognition of distinctive values and traditions, always in the end prevail.

The cult of a weak state, the idea which market liberal economists and many others accepted, including parts of the left in the '90s, that really the thing was to shrink the state, almost weaken the state, almost fragment the state. The inevitable result of weakening the state in the longer run of a generation or so is that strong states reemerge, authoritarian states reemerge. So I anticipate, though not in the form in which they had in the 20th Century, not in the Nazi or the communist form, I don't anticipate those types of totalitarianism reemerging. But I do anticipate, and we're now moving into a period in which attempts will be made in parts of the world where the state is fragmented or broken down to reconstitute, to build it up new types of states. These new states may fail. It may be very difficult actually where the state has comprehensively collapsed to build it up again quickly. But attempts will be made. So, in that kind of context, I don't think we should think of the types of ethnic conflict we're now facing in parts of the world, the types of ethnic warfare we see lately as circumstances which are going to rapidly disappear. We shouldn't think of them as kind of transitional phase to some much more harmonious and economically rational world. This is the way that human beings are prone to react when their sense of justice, or their basic needs, are challenged.

Before I move on to why I think the present system ... as a global regime may be unraveling anyway, let me just say a little bit more ... about ... an inherently painful subject in may ways, about the difficulties of terrorism. I think one of the things we've learned in Europe as in Britain is that it's extremely difficult to fight terrorism and impossible to eradicate it. In the British case, there's been a serious problem in Ireland for many centuries, many generations. And over the last 25 to 30 years, it's been one associated with terrorism on the British mainland as well as in Ireland. By terrorism here, I mean relatively simple assassinations; for example ... a member of the royal family was assassinated, Lord Mountbatten, the man who led Margaret Thatcher's campaign to become the leader of the conservative party was assassinated in the House of Commons car park, and almost the entire British Cabinet was nearly taken out in Brighton in the 1980s. The point I want to make to you ... is that terrorism occurred despite decades of political initiatives, economic initiatives, security initiatives, and military initiatives, and despite the fact that the British Government, which is the government of a powerful centralized state, has a high degree of control in Northern Ireland, and despite the fact the this occurred in a zone of peace surrounded by a Europe at peace, despite all of that, the terrorism has continued and still exists as a threat.

Much has been achieved in the case of Northern Ireland. There's been a considerable degree of progress. But the idea of eradicating terrorism, though we would all love to see a world without it, I don't believe it's actually possible. It's not possible partly because of the depth of the problems that generate terrorism. We all hope for a more just world, and more equal world, a world in which no one is denied their basic human needs. But the memories of conflict are very deep. And also, just at the level of practice, it doesn't take very many people to be irreconcilable and intractable, to constitute a really serious threat. ... One of things I'd like to transmit ...is the sheer difficulty of eradicating terrorism, the sheer intractability of terrorism, in a sense of the permanence of it. This does not that you are going to have an endless war, but that being alert, being vigilant, and accepting ... a level of risk simply goes with a highly globalized world.

Turn it the other way around. What ... is globalization? Let me just ask that and then try and draw these strands together. What, actually, is globalization? I don't view globalization ... as being primarily a phenomenon of deregulation or of the economic arrangements of the last ten or 15 years. If you think of globalization in that way, then it's not much more than decade old, although there might have begin earlier phases of it. I think what globalization is, basically ... technology. That is to say the driver of globalization is new technologies which curtail or foreshorten, or abolish time and distance in human affairs, and thereby link up, more deeply and widely, events of all different parts of the world. Now, if that's how you think of globalization (and I suggest you do at least try thinking about it) in that way, then you will notice two things about it. First lot of all, it's not new. It goes back at least as far as the last third of the 19th Century, when the telegraph was laid under water between Europe and America in, I think, 1873, connecting markets in Vienna and New York for the first time instantaneously ... It goes back to at least ... the 1860s and the 1870s. That's the first thing.

Secondly, globalization has been developing through a whole variety of regimes in the world. It went on developing throughout the 20th Century, through communism, fascism, the welfare state after the Second World War, the cold war, the free market; globalization has gone through all those different regimes and systems. So you can't identify globalization with any of those. It's an error to identify globalization with any of specific form of modern economic organization.

But a second thing will occur to you if you think about it in this way, which is that globalization understood in [this] way is really just an aspect or an episode, or if you like, the cutting edge of world wide industrialization. What globalization really boils down to is that the whole world is getting in on the act of having an industrial economy, and a post industrial economy, which began two or three hundred years ago in parts of Europe. Now let me suggest another way to think about this. If you think of globalization in this way, then you'll find it puzzling that people in the '90s would talk about globalization as being an immensely revolutionary phenomenon. Some people suggest that globalization is going to transform absolutely everything. Whenever I heard people talking about the "gale of creative of destruction" at the ends of the '90s, I was also wondering at its gentleness, this gale, which involved endlessly rising stock prices, endlessly rising asset prices of all kinds, and no really cold winds. But if you look at the longer period of history, you'll see that globalization thought of in these more complex terms triggered powerful counter movements. In the 19th Century, in England and elsewhere, it triggered labor movements; it triggered social democratic parties. In the 20th Century, it triggered communism and communist parties. In some kind of way, you could even say it triggered fascism. If we think of globalization in this more complex way, as the next phase of a huge wave of world wide industrialization, which changes the way people live, where they move from the country into the city, and where the whole pattern of life changes, then it's natural and reasonable to think that globalization will be accompanied by large conflicts, that it will accompanied by great problems and human dilemmas.

I was in Argentina last September, before..."So, the way I think we should start is not by underestimating its possibilities for human advance or human emancipation, but by being very sober in our assessment of the risks that go with globalization, by being very sober and disciplined and rigorous in our attempt to think through what it actually means for every day life. ... I was in Argentina last September, before the Argentine collapse. It was already evident that many of the problems of globalization would occur ... and I said so when I was there.

If ... globalization means a set of policies in which something between a quarter and a third of the work force is unemployed (as in Argentina in late 2001 and early 2002), and certainly something like 30 percent are way below the water line in terms of poverty, so that ... it's ceasing to be middle class, and is becoming angry, is either emigrating or tempted to support populist radical movements ... if that's what globalization means, if that's what a set of policies designed to promote globalization means, one can see actually that the so-called pursuit of stability by stabilization policies in those countries will trigger political intractability, will trigger political melt down, will trigger all kinds of humanly harmful difficulties, as has already happened in other parts of the world, parts of the world prone to ethnic violence such as Indonesia, have seen extensive violence. They've seen pogroms. They've seen large scale melt down of state authority, not caused exclusively by the promotion of globalization or ended policies, but certainly not helped by them

So the constant need, I think, is to recall that when one is dealing with an economic project, an economic model of this kind, [one] ha[s] to feed into it what you know from history, from anthropology, from literature about human beings, their needs, their vulnerabilities, their passions. ... That can be hopeful, but you've also got to remember it can be very dangerous. The 20th Century is not, I think, on the whole, something that we'd like to repeat. The 20th Century in terms of mass killings, the killings of human beings by other human beings is, I would suggest, the worst there ever was. That's partly because the means were greatest; it's also because the ambitions were greatest. The ambitions of actually wiping out whole peoples were greatest. Some of the killings occurred as part utopian experiments, the idea that if you could sacrifice a whole generation of people, you'd have a better world thereafter. In other words, the old phrase used to be, "If you want to have omelets, you've got to break eggs." Millions, and millions, and millions of broken eggs, but very, very few omelets were the result.

So, the basic reason why global laissez-faire, or the global free market is now unraveling, it seems to me, is that human beings are reasserting their needs through politics, and through war. So the unraveling that taking place, I think, and which can be seen in phenomena such as the reemergence of protectionism, such as the reassertion of the authority of powerful states like the US, but also like China, ... can be understood and predicted and foreseen as a kind of reassertion of human needs, not always in benign forms. ... The task for the future, it seems to me, is to humanize globalization. The task is to actually understand the way in which it impacts on human needs, to understand the risks, its down sides, its hazards, to understand that the model of a kind of perfectly harmonious, or even predominantly harmonious globalized world, in which capital moves freely, knowledge moves freely (people very rarely move freely, by the way, in such a world), in which the factors of production move freely, and people are willing to accept the loss of controls through politics, are willing to accept the loss of democratic accountability over many aspects of the economic life, is simply an illusion. It's never been like that and never will be.

It's only really a plausible illusion in periods of boom. The moment boom comes to an end ... I'm always accused of being a pessimist, because I say things like, "Well, you know, normally, historically speaking, booms don't go on forever. Normally, historically speaking, they do come to an end." ... We should therefore plan for equity and justice and the meeting of basic needs can be secured when there isn't a boom, when there's a down turn, even quite a long down turn. That was actually where the welfare state came in Europe. It was where the Roosevelt experiment, why it was launched in the US, that's where most of the humanizing experiments of the last century, most of the brightest side of the last century came about as a result of experiencing and then planning for, in a sense, the down turn. Not because we always live in a down turn, but because we want to be able to survive a down turn without grave damage to our social and human fabric.

Where this leaves us, I think, is that I'm not one of those who think the there is some radically different global system that can be adopted to cope with globalization. I know some anti-capitalists believe that a wholly different set up is needed. I don't understand what that set up is. It seems to me that what's needed is almost the opposite. What's needed is actually returning initiative and authority to politics, to states, to localities, to neighborhoods, even to sovereign states. ... Why do I think that? Because I think a world in which more things can be resolved politically is a safer world. A world in which more issues are resolved by politics is a world in which fewer issues can be resolved by war. The key ... issue in the next ten or 20 years will be the containment of war, because I don't believe that the comparative peace achieved in the Middle East of the last few months is a guide to the future. I don't believe, I think that the risks have gone away. I don't think the threats have gone away. I think all the kind of risks which we saw suddenly in September the 11th, which were suddenly revealed, will continue.

... I would wish to be able to conclude by a much more glowing vision as it were, a much more hopeful vision. ... I am hopeful that the promise of globalization, the promise of using new technologies, and the interconnectedness of life around the world to advance human well being and human freedom can be achieved. But the precondition for achieving it is to understand how difficult it is, and to understand the world we're actually in.

I'll just conclude, because I would like to take questions and encourage dialogue, by quoting a great poet, John Asberry. This is a ... sentence which is always very important to me. It's in his poem, "Self Portrait in a Convex Mirror." He writes, "Tomorrow is easy. But today is uncharted." I think the primary difficulty we face is ... understanding the present. Unless we do that, which involves great discipline, great rigor, also a kind of discipline in which you are willing to face up to the permanence of risks, the permanence of difficulties. We have to accept that some conflicts are deeply rooted in our lives, that is the condition of actually moving forward.

Question and Answer Session

Q: If the President of the United States were to ask you ... where this is going to lead, what he should be doing next, what would your advice be? Gray: I'll tell you what I would tell him. So far, what has been done seems to me to have been prudent and restrained, and successful. I'm not one of those who thinks that this is a problem which can be dealt with by non-violent means. I think a military response is necessary; it's justified and it's been reasonably successful. What I would caution is that it may be the case that expanding this conflict to include states that are believed to be preparing weapons of mass destruction can be justified. That might be the case.

But even if that's true, and even if a war extended in that way were comparatively successful, I would say two things about it. First of all, war would not remove the terrorist threat. If you accept my basic point, which I think is widely accepted in Europe, then the threat of terrorism is global. It's not focused in any regime. It emerges from parts of the world where no state has very much power. And there are many such parts of world. Simply removing one regime will not remove the terrorist threat. The idea that knocking out a regime, that any conventional military operation will eliminate terrorism is an illusion. Some of the reasons are that be learned from September the 11th itself. What did we learn from September the 11th? So as long as people can move around the world, which we all want people to be able to do; as long as we have free societies, where we're not monitored day and night, as long as there are even small numbers of people who are deeply aggrieved, this will continue to be an absolutely major risk of terrorism. So I think, one thing I would say, and as I say, I do believe the response has been pretty restrained and prudent, I think it's a great mistake to expect too much from conventional military action against states. That's the general consensus I think of most military experts throughout the world on these issues.

The second thing I would say is that in so far as one is dealing with this as a long term problem, you need the cooperation of other people right throughout the world. [The Americans] don't want to engage in any action which leads to many regimes removing their cooperation, or withdrawing it. You don't want to engage in any action at a time or in a way which does not have fairly broad support. I think there is a risk of unilateral action, or action with a narrow base of support, alienating people who would be helpful in this.

It's kind of unpleasant to think of it in these terms, but I think that if one is realistic, one is viewing this as a problem which we'll be with for the whole of my life, and, I believe, the whole of your lives; the whole of the life of the youngest person in this room. It's not something that can be wiped out by a sudden set of military actions. Terrorism is something you have to learn to contain, to manage, to make as safe as possible ... So I would just caution against the idea that this is, in fact, a problem the can be solved by a sudden, quick kind of action. Such action may be necessary for other reasons. But it won't get rid of terrorism.

Q: You talk about the need for some kind of return to politics. [Y]ou spoke about it in the context of strengthening institutions related to politics at the level of the state or the neighborhood. For me, and maybe this is a romance, part of my sense as a person who is an immigrant to this country from a former British colony ...

Gray: Which one?

Q: India.

Gray: I see.

Q: One of the places the Great Game was played. I guess I'm curious about governance. I will use that word instead of politics. But governance, which involves politics, but also involves values, at the level above the state, and what the role of that [governance] is ... I mean, Europe has been working on a project and set of governance institutions that go above the state for the last number of years, and I'm shocked personally to see how far it's gotten, having read European history. So I was wondering if you could comment on the role of governance above the level of the individual state in this whole process that you're describing, because I don't completely agree with you that terrorism is not something that is based in regimes. Terrorism is based on factors that are way more fundamental than any regimes.

Gray: Well, I'll try and respond to your question. It's certainly true that in Europe there has been a comparatively successful development of institutions which go beyond the nation state. But - and I speak here as a strong supporter of the European project in most ways - they're not terribly democratically accountable, or terribly democratically popular. I mean, when democracy actually operates in referenda as it did in Denmark recently the Danes rejected membership in the EU. The government of Britain is very cautious about letting democracy operate, just in case it doesn't deliver the result that it wants with regard to Britain's role in the EU. These institutions are not seen as all that legitimate or that democratically accountable. So although we do, indeed, have transnational institutions that transcend the nation state, the upper limit democratic accountability in Europe is still the nation state. There are no democratically accountable institutions anywhere in the world beyond that. So I actually think that it's downwards the accountability should go. Not upwards, because upwards is very difficult.

I'd make another point. Which is that some of the worst features of European life in the last decade have not really been much diminished by these institutions. Let me give you an example. Most European countries, have far right parties, include Denmark, Austria, France, Germany, and ... Italy. There's been rather nasty and unpleasant reemergence of far right politics in Europe. I was often asked when I was attacking the new right, what would come after the new right? I said, "Probably the old right." That has happened. It's happened throughout eastern Europe, post-communist Europe, every post-communist European country now, even the most successful ones, like Poland, have old style parties, which are really not that easily distinguishable from what they were between the two wars. They're not as big as in the 1930's; they're not taking over government in most of these countries. They're between 10 and 30 percent of the vote, depending in which countries you look at. But they're significant blocks. So although I'm a strong advocate of European integration in most contexts, I can't really see that, it's coping with many of these problems that European societies face ...

There's a risk of them transnational institutions becoming more and more elitist, drifting away from the people, and the great risk of that is that the far right then takes up the cudgels for national democracy. That's what happened in Denmark. What happened in Denmark was that all the progressive parties, all the liberal parties said, "We should go in." All the newspapers, all the trade unions said, "Denmark should integrate itself fully." That was not popular. So recently the far right parties have actually grown tremendously in strength in Denmark, and even the sort of official conservative parties have shrunk. So I think that's it's risky to rely on transitional institutions... I would prefer to see more downwards devolution than upwards devolution.

If I just draw one consequence of this. This means - and this is tremendously offensive, or dangerous, or considered to be absolutely frightful by many people - it means that various policies which are currently governed by or limited by transnational institutions of global treaties on free trade, for example, would actually have to be made more flexible...

... The notion that a country just can't do anything about these things, it's often they just have to take what the rules say, or face disaster, I think is a great impediment to human well-being. But let me give you an example, before I take other questions. You may remember a few years ago where Malaysia imposed currency controls. I remember reading the financial press. "This will be a catastrophe", everyone said. "Once they put it on, they'll never take it off. The markets will flee. They'll be ruined." What happened? It was moderately successful, and about 18 months later, they took them off again. Nothing happened actually. It actually worked.

Consider a different example, China. The Government of China is often admired ... as a haven of economic stability and good government for one very good reason: it's never taken Western advice. It's exhibited profound indifference, sometimes extending to more than indifference, for Western advice, and, as a result, it's universally praised in the West. It has never done what post-communist Russia did for a while, which is release control of the economy to the "market" ... So I real think that it's more important that states are responsive to political demands at the level of sovereign states than they devolve upwards.

Q: Given that business and government , especially in the West are ... really coming together as one, people in business become politicians and elected officials, what kind of forces have mobilized on a state and a local level to counter ... these kinds of global arrangements?

Gray: I think we already see some of these forces operating. I believe the level of voting for practically [every country] is falling. I believe that membership in political parties is falling. I give you an example from Britain to make my point.

One organization has more members than all the political parties put together: The Royal Society for the Protection of Birds. I'm very fond of birds, so that kind of seems to me to be good sense. Put in another way, I mean birds tend to be more enduring than most politicians or even ... they contribute more to beauty and human well being than the vast majority of politicians. But on the other hand, it's not good that collective participation is reduced to that extent. It's not good that what we expect from politicians is now so low. It's not good that we expect spin rather than honesty, that we expect that promises are made only to be broken, and so on and so forth.

I mean all of those things. I think what's already happened in many parts of the world is that the NGOs have taken over, Greenpeace, Friends of the Earth, all kinds of NGOs, the spin offs from labor movements and so on ... That's, I think, a potentially benign development. But it, too, has some risks, because the problem is who has standing in that kind of situation. The problem is if they're not embedded in genuinely democratic local and regional institutions, you will have simply a conflict of lobbies developing, which has happened in quite a number of areas of policy. Let's not forget when you have really difficult problems, not all the lobbies are the lobbies we would approve of. They can be racist lobbies. This has happened certainly in Europe, there are some pretty malignant groups about. So it seems to me maybe one should think of these things. I mean, I know there are groups in Washington thinking about this, centrist groups and others. One should think about the electoral system.

I don't think changing the electoral system can charge everything. But maybe it could improve matters. Maybe [instead] a two party system, maybe we need to institutionalize three party systems. Maybe you need to really have a more serious look at how things like NAFTA can actually inhibit the freedom of state governments to engage in all kinds of things, like protection of the disabled or environmental policy. Maybe one has to look at all of those things ... Of course, again, what people say is, "Well if you do that, you have a kind of chaos. You'll have a war of all against all. You'll have all these different governments and states doing different things. Well, you'd have a less tidy world. You might in some sense have a less economically productive world. But you might have a safer world. You might also have an a more humanly liveable world in which actually people do feel involved. The principal reason people are exiting from politics, it seems to me, is they believe they can have very little impact upon it, there are other parts part of their lives where they could have more impact.

Q: I'd like to address your point on the scarcity of resources. You had said in the 20th Century that many of the problems that we face were against the back drop of the different isms, and the 21st Century, that resource scarcities provide the back drop ... I was thinking, in terms of resources, and just in a small way here in New York now, we're facing a water shortage ...

Gray: Yes. I know.

Q: But there are some nations ... I was talking to the Ambassador to Turkmenistan, that they have a very severe water shortage and are dealing with very deep climate issue. So, in terms of this backdrop of terrorism and scarcity of resources, then how would you address the more developed nations and their consumer usage, or how we are using resources. On one sense, after September the 11th, they say, "Go back to business as usual." But maybe we need to go back to business as anything but usual. How are we going to modify our life? ... So how do you propose, or what do you think, how can the West deal with that kind of thing?

Gray: Thank you. I think it's absolutely true that all the developed countries will have to moderate, for example, their use of energy, otherwise they'll be committed to deep seated investment in those parts of the world where there are the remaining fossil fuels. I mean, that's already, as I mentioned about Central Asia, that's actually already happening. Now I don't think it's possible. Let me tell you, I don't think it's possible to move out of all fossil fuel use or risky technologies.

Why do I think that? Well, partly because parts of the world that weren't industrialized are industrializing and are entitled to industrialize. It doesn't make sense to turn around to countries like India and China and say, "Well, we polluted. We industrialized. We used all the resources, but you can't." That's nonsense. It's completely inequitable and unacceptable. So on those issues, there has to be some kind of bargain struck between the rich countries, the affluent countries, the US, Europe, and Japan, with the rapidly developing countries in terms of resource usage. I mean, I know I've read recently that in Korea and even in the US, there are now climatic impacts resulting from desertification in mainland China. There's a very rapid expansion of deserts in mainland China now. There are of course, huge deserts in post-communist Central Asia, what used to be the Soviet Union. The Aral Sea, for example, is completely dead. These all have global spill over effects. You're quite right. The idea that our way of life can go on unaltered I think is a complete illusion. There needs to be a fundamental look at energy use, and fundamental look at the way we live, the way we work ... I mean you might even have to, you know, think about very radical ideas, like diminishing the role of the motorcar, the private motorcar in our lives. Or, at least having much more fuel efficient ones.

Now, technology may help. Again, I'm not one of those who thinks that all of this can be done by new forms of taxation and new forms of government. I think technology - fuel cell technology and other types of technology, which are on the way - can help. But if you're talking about a technology which might be with us 20 years from now, well, we don't want to wait for 20 years, because in 20 years, the pressure on resources will have increased. ... I'm glad you mentioned the issues of water, because they're pervasive. I was in Spain recently. There are water shortages in most parts of Spain. No violent conflict, but wherever I went, people were locked in conflict with other parts of the country, other autonomist regions of Spain about water, because water crosses from one jurisdiction to another. It crosses one democratic unit to another. So actually, I think this is a feature our lives, as it were. It's a feature of politics which we'd do well to pay great attention to. [This] brings up something very important, learning to live within limits, learning that resources, though you can expand them, you can have new technologies, you can use them more effectively ... are finite. I mean the oil which is in the world now is not there because any government put it there. It was put there by the sun billions of years ago. It is where it is, and it is radically finite. So, if we want to think ahead to maintaining something like a sustainable industrial society in the future, where there is technical progress, we have to think of really radically about altering our way of life.

I have to say on the other hand, and this is not something which is true only in the US, it won't be easy. Let me give you an example from my own country and from Europe. Think back, not to September 2001, the terrible events of that time, but to something less terrible, but quite significant, September 2000. In September 2000, nearly every European country had popular demonstrations by truckers and motorists, including Britain. There was a brief moment when it seemed as if the whole country would be brought to a standstill by about 3,000 truckers. It was a very, very interesting moment. What they were demanding were lower energy costs. One of the reasons, by the way, they were able to bring the country almost to a standstill so quickly is globalization ... You've all heard of lean production, just on time delivery? Well supermarkets used to be filled up once a week, or even once ever ten day. Now they are filled up three or four times a night. So if you put the squeeze on, as these truckers did, just a matter of days up to the point of bread shortages, and so on and ... So they had the power to do it. And they were popular. In other words, when ordinary voters, ordinary motorists, ordinary truckers say, "Why should 60 percent, 70 % of the price of gas" - because gas is much more expensive in Europe than in the US - "go in tax?" And the government replies, "Because it's environmentally better that way." I believe it is environmentally better that way. The people don't necessarily accept it.

So you have a problem of democratic acquiesce in wasteful energy use there, in all European countries, including France, Germany, Portugal and Britain. It's a tremendous struggle. But it's absolutely essential because what clearly isn't possible is that the whole world would industrialize at the level of resource use, which a few countries have engaged in for the last 20 or 30 years. That's not possible, I don't think. You'll run into really quite rapid problems of climate change and water problems, desertification, et cetera, really quite quickly if that's the model. That free market model isn't viable.