Branko Milanovic on What Comes After Globalization

Branko Milanović framed the episode around his new book, which traces the post‑1974 arc of global economic orders and argues we are witnessing the birth of “national market liberalism”: a regime in which governments preserve domestic market liberalism (competition, lower domestic regulation) while systematically reversing the liberal international order — raising tariffs, restricting cross‑border flows and pursuing mercantilist industrial policy. Milanović told hosts Joe Wisenthal and Tracy Alloway that he intends this label to capture a peculiar hybrid: domestic neoliberal continuities combined with aggressive, state‑led international economic competition. He traces this shift through the distributional consequences captured by the “elephant chart,” noting that Asia’s middle‑class rise has materially improved billions of lives while simultaneously eroding the global position of many Western lower‑middle deciles.

The conversation moved between macro history and concrete policy: Milanović emphasized China’s dual status — officially upper‑middle‑income and close to the U.S. on key technologies, yet still home to substantial rural poverty — and used consumption‑to‑GDP comparisons (China ~40–45% vs. U.S. ~70%) to explain why Chinese domestic demand still lags. He documented the rise of a new co‑earned elite (homo ploutio) that combines high labor compensation with large capital incomes and transmits advantages across generations, reinforcing political and economic entrenchment. Milanović argued the retreat from globalization raises the specter of escalating geoeconomic competition and even conflict unless political crises (he singled out Ukraine and Middle East wars) are contained and global institutions renegotiated to give China and India clearer roles. For remedies, he prioritized sustained growth in Africa and India as the only reliable way to lower global inequality, while domestically endorsing stronger public education and a recurring “pedagogical” tax on extraordinary wealth to curb plutocratic political power. Hosts probed and pushed back — Joe questioned placing Trump in an anti‑elite category given pro‑business policies; Milanović differentiated between the political grievances that elected leaders harness and the orthodox economic policies those leaders often pursue — underscoring the complexity of the present transition away from late‑20th century globalization.