“It is the ideas of cooperation and development of science and culture that drive the global progress. In European philosophical thought, the idea of the importance of Eurasia for global development is by no means new. Gottfried Wilhelm Leibniz, the great polymath, wrote about the cultural diversity of Eurasia as early as the beginning of the 18th century. It is possible to unite Eurasia even more, from north to south (up to Persia) and from west to east (up to China), by establishing an institution for joint research and by developing arts and education. “ 

Chokan Turaurovich Laumulin, Researcher at the Center of Development Studies and Cambridge Central Asia Forum, Jesus College, Cambridge University, United Kingdom 

THE CAUSE OF PETER KAPITSA AND VANNEVAR BUSH

FE: We know that you took an extremely negative view of what happened to the economies of the post- Soviet countries. In particular, you mentioned the catastrophic de-industrialization that affected all the countries after the collapse of the USSR. Is this what your research at Cambridge is about?

CL: My thesis is devoted to the interaction of science and social policy underpinning the industrial paradigm of development on the example of the USSR. I try to make my contribution to the rethinking of the history of the USSR through the prism of the creation and functioning of the Soviet “industry of discoveries.” It was the organization of scientific research that underpinned the Soviet policy of development. It transformed the country and had, and continues to have, a significant impact on the development of the world’s natural sciences, high technologies and, consequently, the global economy and many types of relations. This policy was supported by the most extensive social and educational programs for the creation of an appropriate environment, as eco-systems for the growth of human capital, based not so much on ideological doctrines as on purely scientific approach and methodology.

The developing countries of today could learn a lot of useful things from the fact that this successful policy was often implemented in the conditions of almost complete lack of resources, including the absence of the most important resource — time required for the formation of complex public institutions. Interviews with some of the world’s leading physicists and scientists, including the former head of the Cavendish Laboratory at Cambridge and the Argonne National Laboratory in the United States were part of this research. An important part of my work is devoted to Pyotr Leonidovich Kapitsa’s contribution to science, engineering and educational activity directed, particularly through correspondence with the leaders of the USSR, to the creation, strengthening and popularization of Soviet science and the “industry of discoveries”. Curiously, in the recent history of the United States there was a personality similar to Pyotr Kapitsa — Vannevar Bush, a scientist and engineer, one of the “fathers” of NASA and other leading scientific institutions, methodologist and organizer of scientific research and the scientific community, science adviser under President Roosevelt.

FE: So, the cause of Vannevar Bush was followed by his descendants in the US? While we only recently resumed our attempts to restore innovation science, as well as science as a whole. Why has the West been able to sustain its development and preserve continuity?

CL: The modern concept of the Triple Helix of Innovation (Stanford University, USA, and European studies) suggests that the progressive development of society is carried out through the rotational interaction of three central areas whose edges overlap within the spiral: government, academia (universities) and industry, that create an innovative core of development. It forces the centers to rotate, ensuring the progressive development of the entire model, safeguarding against shortcomings and duplicating the functions of other centers. This, in my opinion, is an ideal model. In many developed countries, including the United States, the autonomous functioning of these development centers has caused problems in connection with their increasing proximity, and the relevant industrial policy is aimed at dealing with it. The formation of these centers has been taking place for centuries, and they represent a complex evolutionary social model of the “industry of discoveries” itself.

It is very difficult for developing countries to simply copy this effective model due to their underdeveloped centers and lack of time. The pioneering experience of the USSR has shown that the government can act like a locomotive for the development of the other centers of industry and research in order to drive the whole system, even tolerating the largely unavoidable potential risks of losing the effectiveness of interaction between certain elements because of the overwhelming role played by the government. This path was adopted by communist China.

CHINA AND THE FORMER USSR

“THERE ARE DOMAINS OF INTELLECTUAL 

and moral life that lie beyond the struggles of nations.” Max Planck, German theoretical physicist, founder of quantum physics, winner of the Nobel Prize in Physics (1918).

FE: Academician Sergei Glazyev, Professor Dmitry Sorokin and other Russian scholars believe that the Russian Federation and the EEC need, roughly speaking, to board the Chinese economic train — there is still a chance to join the nucleus of the new center of economic growth, take advantage of the new world economy, transition to a new technological order thanks to those mechanisms, and resume the trajectory of successful, sustainable and rapid economic growth. And if we do not change anything, then we will become a periphery of the Chinese economy, as we are now a periphery of the US-European economy. And how can we still maintain integrity, when these two centers, the old one and the new one, will be testing us to destruction? Do you think both of these chances are still there?

THE HISTORICAL RECORD OF INVESTMENT 

in scientific research belongs to the USSR, which surpassed the US with 2.7 percent of GNP in 1960, and broke the absolute record with 5% in 1980.

CL: The Chinese Silk Road Economic Belt, as part of the One Belt and One Road Initiative, is China’s geopolitical and strategic innovation within the established historical paradigm of the united Eurasia not only as a trading space but primarily as a system of creating and exchanging knowledge and technology that took shape back in the Bronze Age. It formed the basis of every historical Eurasian project, be it the empire of the nomads, the Moscow Tsardom, the Russian Empire, or the USSR. A quantitative analysis of Chinese investments in the current project and the volume of trade can really lead to an idea that the EEC as a post- Soviet economic integration project is second-class and lacks any prospects due to the striking difference between the sizes of the economies in question and the overall demographic situation. However, in my opinion, in order for the EEC to formulate an adequate asymmetric response to the challenges of the time it should take an altogether different approach from confrontation or direct competition within the paradigm that has already emerged. By the way, out common history is full of unexpected approaches.

Speaking about the “core of the new center of economic growth”, it is very important to understand that this core is the development of natural sciences and, hence, technologies that form the lion’s share of the volume of developed economies. The abovementioned Pyotr Kapitsa and Vannevar Bush, relentlessly and practically in identical terms, described the primacy and foundations of research and discovery in the new industrial economic reality.

IT REMAINS AN OPEN QUESTION

whether China, like the USSR, will be able to create a new scientific and technological reality for humanity. It is still largely based on the space exploration program, the discovery of superfluidity, the laser, the development of semiconductors, the development of theories of microelectronics and semiconductor heterostructures, nuclear power engineering, the mathematical school, geological research and many other breakthroughs and achievements of the Soviet Union across the entire range of scientific disciplines.

The post-war USSR and United States, as superpowers, were actual “knowledge economies” with more than half of their GNPs and GDPs, respectively, generated by technologies engendered by natural sciences. Fundamental science, physics and chemistry in particular, is a reservoir of knowledge, from which practical scientific solutions are drawn and technologies emerge that even today form the basis for the development of innovative economy. The neglect of this fundamental principle in the implementation of the modern policy, coupled with underfunding of culture, the humanities, education and healthcare as the most important components of the eco-system’s innovation environment, may lead to a decline and degradation of modern societies. Conversely, investments in this direction create the effect of the overall development of the system, increasing the international weight and influence of a particular country, as the example of China has demonstrated.

FE: Maybe, it’s not a very scientific question, but nevertheless it concerns many Russians and, probably, citizens of the other post-Soviet countries: “Can we emulate China?”

CL: China has followed the development road paved by the USSR by consistently boosting its investments in research up to 2 percent of GDP, which in absolute terms has put the country in second place among the world leaders, including in terms of the number of scientific publications, right after the US. By the way, as a percentage of GDP, in terms of its R&D expenditure (2.7%), the United States is in 10th place, with Israel and South Korea leading with 4.25%. As a matter of fact, the historical record belongs to the USSR, which surpassed the US with the same 2.7 percent of GNP in 1960, and broke the absolute record with 5% in 1980.

However, as the example of the USSR shows, the development of science is not a panacea, but, nevertheless, there is a necessary condition for development, which for a developed country today can be 2.4 percent per year, according to the average data for OECD countries. For example, the current levels in Russia, Belarus and Kazakhstan, which make up the core of the EEC, i.e. 1.19%, 0.67%, and 0.17%, respectively, are clearly insufficient. Extremely pressing are the issues of organizing joint scientific research at the leading edge of science among the EEC countries, prioritizing fundamental research to form the core of new technologies and common economic chains in the course of joint development of integration technologies.

At the same time, the increase in investment should be accompanied by a correct scientific and methodological approach to organizing and managing research. It is well-known and well understood in the scientific community, and is considered universal. Despite the fact that our system is still reproducing high- quality human scientific capital in sufficient numbers, there are issues in the formulation of a new personnel policy. Pyotr Kapitsa repeatedly expressed the idea that an organizer of science is the rarest and most valuable type of manager. His competence, level of knowledge and scientific intuition, and authority should be of special magnitude.

The China example demonstrates that the fundamental principles successfully implemented by the USSR have been rethought and no less successfully implemented in China. At the same time, a certain parallel can be drawn between the development of the two countries. Like the Soviet Union in the late 1930s, China is now completing industrialization, based on technological transfer from outside. Rapid development of the research and educational base as a source of domestic expertise allows the country to adapt to the transfer and gradually reduce the level of systemic dependence on it. At the same time, the institution of academic thought and research serves as a hidden internal processor for the entire system and a “forge of cadres” for managing the state and private economies and the society.

FE: Is there any idealization of Soviet success in these words?

CL: If you touch upon such an imperfect, and yet illustrative, tool for assessing the development of natural science as the Nobel Prize, Soviet physicists earned a mere 9 of them. In terms of quantity, it cannot even be compared with Cavendish Laboratory (Department of Physics) of Cambridge University alone, with its score of almost forty.

However, in terms of quality, the discoveries made by those nine people were so fundamental that they firmly laid the foundation for the world’s intricate technological picture and technological chains. By the way, perhaps no one high-tech product is produced in one country today, and this factor should be taken into account when setting up the future “industry of discoveries” in Eurasia.

The concentration of efforts, intellectual and material resources on the organization of research in Eurasia can stop the de-industrialization of the EEC countries, give impetus to the development of innovations and restore the regional, continental and global positions of our nations in the conditions of a new industrial revolution. Very soon it will change the global lifestyle and various social, political, economic and other relations. 

One of the most important historical tasks of the Eurasian nations which are going through a difficult period in their development is taking an active part in this process to achieve global progress. In doing so, it is very important not to be guided by a narrowly practical or tactical approach. As the father of quantum physics Max Planck wrote a century ago to his colleagues in the countries which had turned hostile overnight, “there are domains of intellectual and moral life that lie beyond the struggles of nations.” 

It is the ideas of cooperation and development of science and culture that drive the global progress. In European philosophical thought, the idea of the importance of Eurasia for global development is by no means new. Gottfried Wilhelm Leibniz, the great polymath and inventor, along with Newton, of differential and integral calculus that underlies the current digital revolution, wrote about the cultural diversity of Eurasia as early as the beginning of the 18th century. It is possible to unite Eurasia even more, from north to south (up to Persia) and from west to east (up to China), by establishing an institution for joint research and by developing arts and education. These phenomena transcend national categories and inspire man.

In particular, Leibnitz wrote in 1712:

“I make no distinction between nations or the Fatherland, I prefer to pursue more advanced sciences in Russia than to see them as moderately developed in Germany. A country in which the development of science will reach the widest extent will be my dearest, since such a country will raise and enrich all of humanity. The real riches of mankind are the arts and sciences. This is what distinguishes most people from animals and civilized peoples from barbarians.” 

INTANGIBLE VALUES PROVE TO BE MORE DURABLE THAN THE SATISFACTION 

of material needs, the former ensure generational continuity. According to the opening words of Aristotle’s immortal work “Metaphysics”, written 2500 years ago, “All people naturally seek knowledge”. So far, mankind has not invented a better instrument for exploring the world than art and science. My passion for learning how the world works and my curiosity have led me, a humble researcher, to Cambridge. By the way, this is the universal initial instinctive motivation of all scientists, which they never tire of discussing.

It was the ideas of Leibniz that laid the groundwork for the establishment of the Russian Academy of Sciences by Peter the Great and were further developed with the rapid rise of the Academy of Sciences of the USSR, which combined various and often technologically backward regions, albeit with ancient culture, and gave a powerful impetus to the development of human capital, technology and economy. China, following in the wake of the USSR, is making every effort to stay on this path, drawing the neighboring countries into the paradigm of its development. The EEC countries could be included in this industrial project at the highest, almost subliminal, and yet extremely important, level which determines the overall progress.

No other possibility will ever exist for the EEC countries, except for the development of their own research base, unique in terms of their cultural, historical and human potential and capable of developing due to their vast wealth of resources and geographical location. 

Interviewed by Andrei Prokofiev.

The future of the economic nationalism. 

David Lane 

Fellow of the Academy of Social Sciences, Emeritus Reader in Sociology and an Emeritus Fellow of Emmanuel College 

CHALLENGES OF THE GLOBALISATION

When I was thinking about what introductory remarks I could make to this topic, which is on Beyond Globalization, I looked in “The Communist Manifesto,” where Marx pointed out the following, “National differences are vanishing gradually from day to day owing to the development of the bourgeoisie, to freedom of commerce, to the world market, to uniformity in the mode of production and in the conditions of life corresponding thereto.” This makes Marx one of the first to note the rise of globalization and the resulting uniformity of capitalism. For Marx, the answer to the question beyond globalization was simple: the prospects for global capitalism mean socialism.

What do I understand by globalization? Globalization is the system of exchange involving simultaneous social interactions on a transcontinental basis. State boundaries are porous; technically, it is made possible through electronic and other modern forms of communication. It involves the interdependence of national economies and the integration of economic life. Globalization enables liberal market systems to be truly stateless. Globalization facilitates the transposition of classical economic liberalism to the current form of neoliberalism. Global neoliberalism involves a free movement of labor, capital, goods, and services between countries. It is the market which will determine the allocation, combination and output of goods and services. The global market is the form of economic coordination. The market will resolve incompatibilities between the demand and supply, the factors of production. It will ensure the effective use of resources channeling capital and labor into their most efficient uses.

It is to Donald Trump that I turn to illustrate the social and political deficiencies of globalization. As Trump put it, “In the United States, we have registered unemployment of 7.5mln people actively seeking work, so you can say that realistically involuntary unemployment is at least 12 mln people. And this leads to urban blight, rising interpersonal crime.” Again, Trump points out that “over 43 mln Americans regularly receive food vouchers under the supplemental nutritional assistance program. There is, therefore, considerable poverty for a significant part of the population.” Again, he points out that the trade deficit in 2016 was $645bn. The cumulative trade deficit of the United States since the year 2000 is $8.6 trillion. And the balance of payments deficit is $8.3 trillion.” Trump here describes richest countries in the world. Market mechanisms have not led to a desirable economic equilibrium. Rather, the functioning of the market has led to recurring economic instability and even in the rich states to persistent, traditional and institutional forms of poverty.

ALTERNATIVE OF THE POST-GLOBALIZATION

The system entails the weakening of states and their allocative role. The problem here is that the globalized market does not resolve these incompatibilities. Investment does not always promote social development, though might ensure profits. It does not ensure the optimum employment of labor. The competitive market leads to the rich becoming richer and the poor becoming poorer.

The present discussion revolves around what kind of post-globalization can rise out of contemporary neoliberal globalization. Some envisage changes coming from within globalization in terms of the changing occupational structure and the rise of what they call ‘a creative class’. A new form of production is envisaged which will move towards, if not achieve, what they call ‘the kingdom of freedom’. As my fellow professor from Saint Petersburg puts it, “The world of knowledge in material production is becoming increasingly more significant.” Knowledge intensive production is, and here I quote, “a radically new type of material production.” The problem is how will this change come about? How will it be achieved under the present conditions of globalized capitalism?

This conference is concerned with the Eurasian continent, and it will be interesting to see how the speakers in the first panel envisage overcoming the problems entailed by neoliberal globalization. The problem to be addressed is how a modern form of advanced technological development can be introduced in countries forming the Eurasian Union and political area.

he underlying assumption of neoliberalism is that the unrestricted movement of capital, labor, goods and services will be resolved on the basis of laws of comparative advantage. If countries produce what they can do best and then exchange with others, the optimum level of production will be achieved. But the laws of comparative advantage justify the existing division of labor rather than any natural division between different countries or different areas. So using comparative advantage will only strengthen the existing unequal distribution of resources. It will not lead to investment in training which would give rise to new forms of production in underdeveloped areas. The free mobility of labor will then lead to the greater impoverishment of those areas which lack investment and maintain an unskilled and uneducated workforce.

ADMINISTRATIVE COORDINATION

Outmigration, that is, in neoliberal terms, getting what you deserve from the world, is the neoliberal solution. This, however, has cumulative effects. It strengthens the strong economic areas and weakens the poor ones. What then is the alternative?

Today, anyone advocating economic nationalism is usually regarded as someone almost as evil as a child molester or at least as a Holocaust denier. However, there are many types of economic nationalism. There is not one economic policy like neoliberalism or economic socialism. Economic nationalism can be a shell for socialist planning, one-nation conservatism, a social democratic mixed economy or state- led corporatism. The Soviet Union, as well as the post-war British Labor government operated in the context of economic nationalism. Theresa May currently advocates a conservative form of economic nationalism. Jeremy Corbyn yesterday made a move towards a socialist type of economic nationalism or at least the social democratic type.

THE ECONOMIC NATIONALISM CONCEPT

What do I understand by economic nationalism? The underlying assumptions of economic nationalism are that people forming a nation have a common interest which transcends domestic classes and foreign interests, the state is an instrument to achieve national economic outcomes, and economic nationalism envisages a state with regulative powers. What the Eurasian Economic Union currently proposes is a hybrid economy containing elements of neoliberalism within a casing of economic nationalism. The major objective is to strengthen the national share with more robust geographical economic and social borders. Eurasia will strengthen borders against outsiders. What type of economy, what form of economic coordination will further the national interest?

If market coordination has been shown to lead to slumps, unemployment and poverty, some form of administrative coordination is the alternative. Working within the existing global neoliberal framework will not solve the problem. As there are no institutional forms which can provide such coordination on a global scale, there remain only state-run forms of management, and that is because the state is the only institution that has the legitimacy and often the economic power to carry out systematic development and also to take a long-term perspective. Hence, some kind of economic nationalism is necessary.

The nationalist neoliberals, like Trump, would insist that in the national economy, the best form of economy is based on the psychological principles of self-interest and market competition. The role of the state must be limited to the erection of borders and the maintenance of the system through laws. In my view, the economic problems caused by the kinds of technological changes described by Buzgalin, Kolganov, and Bodrunov can only be managed within a state system organized on a socialist or social democratic form. To take one example: profit maximization and market competition lead to the reduction of employment in order to minimize cost. Even if you bring back industry to the U.S.A. or to Russia, you will also bring back robots and computer assisted design.

Managing employment can only be achieved within the context of a national plan which prioritizes public welfare. This is not being achieved through the operation of individualistic catalysts which set aside individualistic utilities, as theorized by neoliberals like Friedrich von Hayek.

Economic coordination, in my view, needs a national plan, not market competition, and economic nationalism could and should be based on national planning.