I. The neoliberal world and its critics

The most significant development in global politics and society of the last several decades is doubtless that bundle of related phenomena known as globalization. The late twentieth and early twenty-first century have seen substantial increases in interaction and interconnectedness across borders. Trade barriers have been lowered, global financial markets established, transnational corporations and production processes have come into being, migration flows have increased, communication and cultural interchange have become increasingly easy and common. The growing economic, social, and cultural ties between and across nations have together significantly reshaped how states and peoples can act and relate to one another.

Globalization is of course a complex phenomenon with many causes, including significant technological changes. A central factor in the economic aspects of globalization, however, has been the efforts of political forces pushing an agenda: neoliberalism. ‘Neoliberalism’ – a much-contested word which we will use to mean an economic program consisting in the weakening of labor unions and labor laws, privatization, deregulation, and cuts to social services and welfare programs, best summed up by the 10 points of the so-called Washington Consensus – is an agenda which often struggles to find mass political support, and struggled especially in the postwar heyday of social democracy. In response, corporations, economists, and capital-friendly politicians worked to embed neoliberal assumptions in global economic structures and institutions, and to increase the importance of these structures and institutions relative to nation-states.Footnote ¹ The neoliberal program was imposed on countries which would not otherwise accept it, by the race-to-the-bottom dynamics of free trade, by the disciplining effects of capital flight and sovereign-debt crises, and when necessary by the overt efforts of the International Monetary Fund and the World Bank.

Even today, the imposition of neoliberal policies against the expressed will of a country’s people still happens: see the European Union’s continued demands for austerity from Greece, or the World Bank’s manipulation of its own ratings to punish Chile for electing a moderately left-wing president. The result of this process is a world order in which, despite its superficially liberal character, neither individuals nor states are free or equal. Most states have their domestic policies significantly constrained and shaped by global institutions over which they have little control, and consequently there is (in addition to economic inequality) profound political inequality between states. Some states (especially the United States) and even non-state actors (global corporations and capital owners) can dictate the domestic political decisions of other states.

The philosophical literature on global justice has tended to neglect this issue. Much attention has been paid to the massive global economic inequalities; comparatively little attention has been given to the equally massive global political inequalities. And yet, it is unlikely that the former can be solved without addressing the latter. A small group of state and non-state actors currently possesses untrammeled power to shape the economic policy of every state in order to profit themselves; so long as this is true, it will be very difficult to restrain global economic inequality. Rawls, too, does not address this issue, at least explicitly. But a careful examination of the implications of Rawls’s theory of global justice reveals powerful conceptual resources for addressing this problem. In particular, we will consider one of the more peculiar lacunae of The Law of Peoples: the absence of a charter provision specifically securing the distributive autonomy of liberal peoples with respect to each other. Such a provision would be demanded by liberal peoples to protect the fair value of political liberties domestically. Although decent peoples do not share that concern, no reason appears why they should not accept a principle protecting their own distributive autonomy, which Rawls rather arbitrarily indicates that liberal peoples should respect anyway. Once this ‘skipped step’ is restored, restrictions on global political inequality can take their place as a central concern of Rawlsian global justice.

II. Global justice in Theory and Law of peoples

The argument of Law of Peoples is expounded in three parts. The first part extends the original-position procedure from the case of an isolated, self-sufficient liberal-democratic people to the case of multiple liberal-democratic peoples. The second part extends the first part to include non-liberal-democratic but decent peoples, exemplified by decent hierarchical peoples. The third part moves from the ideal theory of parts one and two to non-ideal theory.

The second original position procedure has the peoples settle on a ‘basic charter’ of eight principles (Rawls Reference Rawls1999, 37) – in fact, the only choice they are presented with is ‘among different formulations or interpretations of the eight principles’ (Rawls Reference Rawls1999, 40). The eight are:

1. (1) Peoples are free and independent [and to be] respected by other peoples.

2. (2) Peoples are to observe treaties and undertakings.

3. (3) Peoples are equal and are parties to the agreements that bind them.

4. (4) Peoples [have] a duty of non-intervention.

5. (5) Peoples have the right of self-defense but no right to instigate war for [other] reasons…

6. (6) Peoples are to honor human rights.

7. (7) Peoples are to observe [ius in bello]

8. (8) Peoples have a duty to assist other peoples living under unfavorable conditionsFootnote ² [to achieve] a just or decent political and social regime. (Rawls Reference Rawls1999, 37)Footnote ³

An alternative, more liberal charter would be stronger than this in its limits on sovereignty. It would, at least, guarantee political liberties and equal citizenship, and would address economic inequalities (above a minimum) without regard to territorial boundaries. Rawls fears that a more liberal charter would have the consequence that the foreign policy of liberal peoples would bar admission of non-liberal peoples to the Society of Peoples (Rawls Reference Rawls1999, 82–83), which, he goes on to say, should not be assumed. It may turn out that the admission of decent peoples ‘can be acceptable’ (Rawls Reference Rawls1999, 83). Significantly, but without explanation, Rawls also rules out diplomatic pressure upon and (public) economic inducements to decent peoples to the end of making them liberal (Rawls Reference Rawls1999, 84–85).

A case Rawls cites in connection with a globalized difference principle is particularly illustrative of the difference between Rawls’s thinking here and that of the liberal cosmopolitanism of Brian Barry, Tim Scanlon, Charles Beitz, Dennis Thompson, David Richards, and Thomas Pogge, et al. Consider two liberal peoples at a starting point of roughly equal resources. One saves and (further) industrializes, the other ‘preferring a more pastoral and leisurely society’ (Rawls Reference Rawls1999, 117), does not. Having no ‘target, ’ a trans-liberal-peoples difference principle would identify the pastoralist liberal people as less-advantaged and would require continuing transfers from the more-advantaged entrepreneurial liberal people. ‘This, ’ Rawls says, ‘seems unacceptable’ (Rawls Reference Rawls1999, 116) even though, presumably, something of the sort would be required domestically within a liberal people containing productive pastoralist citizens. The unacceptability in the transnational case seems, at least in part, to be rooted in the fact that in the domestic case, there is a basic structure which in large part determines the economic fortunes of individuals, while in the global case there is either no such structure, or it has less determinative effects on the fortunes of peoples. Given this, a pastoral people can be considered responsible for its level of economic resources in a way that a pastoral individual cannot, and so an unlimited redistributive principle among peoples would be unacceptable. One major problem with this reasoning, as Allen Buchanan (Reference Buchanan2000) has argued, is that the empirical presupposition that peoples’ economic fortunes are not determined by a global basic structure is false. At least in today’s globalized world, there very much is a global basic structure which has profound effects on the economies of individual countries. There is thus no more reason to hold a country responsible for its economic status than any individual.

However, the reasoning behind the rejection of a transnational distributive principle as presented above is not the best reasoning available to Rawls, although it does appear to be what Rawls had in mind in the text of Law of Peoples. Uncovering this better alternative allows us to see how compelling Rawls’s vision of global justice really is.

III. Distributional autonomy and stable democracy

The debate over cosmopolitanism and Rawls’s global theory, as we have seen, has tended to focus on economic and distributive issues, often to the exclusion of focus on the (in the domestic theory, lexically prior) issue of political liberties. The very first principle of the global charter guarantees that peoples are free and independent, but the neoliberal, globalized world order, as we will see, poses a number of threats to this freedom and independence. The question, then, which Rawls never quite asked, is this: given the constraints imposed by the burdens of judgment, what principles might the representatives in the second original position agree to, in order to safeguard their existence as free and equal peoples?

Consider three historical cases: first, the behavior of the United States toward Great Britain during the Cold War. With the surrender of Nazi Germany, in May 1945, Britons generally considered the Second World War to be over and won. Hoping to capitalize on the euphoria of victory, Churchill called a ‘snap’ election. But Labour, under Clement Attlee, won a decisive mandate for its socialist program, which meant nationalization of the commanding heights of the British economy. The American reaction was swift and harsh: the Lend-Lease agreement was abruptly ended and Britain, exhausted by the war effort, had to pay cash for whatever the US supplied it until a new loan (on less favorable terms) was negotiated.Footnote ⁴ In the aftermath of Hiroshima and Nagasaki, America reneged on its agreement to share nuclear secrets with the British, forcing Attlee to develop a British bomb secretly and independently. The Labour government held on until 1951, but Britain’s economic recovery was impeded by the hostility of American banks and officials toward Britain’s democratic socialist ways – ways that Rawls explicitly declared to be consistent with realizing a just liberal society. The ‘democratic peace’ between the US and the UK was not violated militarily, but economic pressure was brought to bear upon a liberal democratic people to force it to abandon socialism.

Second, the experience of French president François Mitterand provides a slightly different example of the same general problem. Elected in 1981 on a socialist platform that was radical even by the standards of France, Mitterand in his first year in office attempted to implement his program of nationalization and redistribution. However, his election prompted massive capital flight, with business owners, bankers, and the wealthy pulling their money out of the country for the comparatively safe harbors of Germany or Britain. This sudden drain on France’s capital stock, combined with the restrictive monetary policy forced on France by the European Monetary System (forerunner to today’s Eurozone), forced Mitterand to choose between implementing his platform and avoiding an economic collapse, and in 1983 Mitterand abandoned his original program and turned toward austerity, continuing to govern France from the center for more than a decade.Footnote ⁵

Third, consider the situation of Ukraine in relation to Russia. These are not liberal peoples, but the case is illustrative of a dependence that could exist between two liberal peoples. Ukraine is largely dependent on Russia for much of its economic needs, especially with regard to energy. Most of the oil and gas that fuels Ukraine’s economy comes from Russia. This has made it very difficult for Ukrainian leaders to exercise political will independently of Russia’s wishes, and the country has largely been governed by puppets of Russia since gaining independence after the fall of the Soviet Union. In fact, a major source of the increased conflict between Russia and Ukraine in recent years is a result of Ukraine’s attempt to escape this economic dependence by developing trade ties with the European Union.Footnote ⁶

These examples demonstrate the way that the neoliberal global economic, political, and military structure leaves peoples vulnerable to economic and other ‘soft’ pressures from both other states and non-state actors in the global capitalist class, undermining peoples’ ability to democratically realize their own domestic conceptions of justice.Footnote ⁷ Rawls explicitly disapproves of these kinds of pressures being put on decent peoples to push them to become liberal, and it seems equally objectionable for liberal peoples to use them to influence each other.

The issue here is a lack of distributional autonomy, the ability of peoples to determine their own economic structure and internal distribution of resources; in other words, to realize their own domestic principles of justice. As Allen Buchanan points out, Rawls’s arguments against a transnational distributive principle rely on an assumption that peoples possess distributive autonomy (Reference Buchanan2004, 210–16). If a people is not capable of determining its own internal distribution anyway, the interference with their distribution caused by a transnational distributive principle is not as glaring a problem. However, pace Buchanan, distributional autonomy is not an empirical assumption which Rawls takes to be a present condition of modern liberal states. Buchanan is correct that few if any states in the world today enjoy distributional autonomy. However, the assumption of distributional autonomy in Rawls’s law of peoples is better read not as an empirical description of the world but rather as a normative requirement of the theory.

We must make extrapolations here from Rawls’s stated views, as this is not an issue he ever explicitly addressed.Footnote ⁸ However, it seems clear that anyone committed to a liberal, domestic conception of justice must be committed to distributional autonomy as well. This is especially clear if the conception includes, as Rawls’s does, a guarantee of fair-valued political liberties, because the ability of capital owners and foreign countries to exercise veto power over a people’s economic policy clearly robs the citizens’ political liberties of their fair value.Footnote ⁹ Even a people more content with the formal political liberties, however, will still have reason to want to be able to realize their own conception, without interference from powerful nations or (arguably even more powerful) global capitalists. At one of the later stages of the first, domestic original position (likely the legislative, but perhaps the constitutional one), where the delegates attempt to put their principles into practice, they will consider the threat that the global system poses for their distributional autonomy, and attempt to insulate themselves from it. One of the strongest tools for maintaining distributional autonomy would be capital controls, which would restrict the ability of individuals and firms to take their money in or out of a country, and thus would sharply curtail the kind of capital flight crisis that caused such problems for Mitterand.

Successfully implementing capital controls, however, would almost certainly require substantial international cooperation, and capital controls would not stop a militarily powerful people from leveraging its position to influence others, the way the United States used its control of nuclear weapons to pressure Attlee’s Britain. Truly guaranteeing distributional autonomy is an issue which ultimately must be taken up at the international level.

The delegates from the liberal peoples in the second original position would have a number of reasons to prefer a global system that guarantees distributional autonomy to one that does not. First, the liberal delegates represent peoples who have already settled on domestic conceptions of justice, which the delegates are aware of and committed to. One of their first priorities would be to ensure that the international system was compatible with realizing their domestic conception of justice, which, as already discussed, would require distributional autonomy. Even if these delegates are not allowed to know what their respective domestic conceptions are (although Rawls allows them this knowledge), they would still support distributional autonomy, as it is necessary for fully realizing any conception of justice, whatever its content. Additionally, the international delegates are committed to the status of the various peoples as free and equal. When one people can use its economic or military position to dictate to or heavily influence the internal affairs of another, the status of peoples as free and independent is clearly undermined.

There is compelling reason, then, to think that a basic charter for liberal peoples would include a provision that assured that the relations between liberal peoples would not undermine distributional autonomy. For example, a basic charter for liberal peoples might insist on capital controls to restrict the flight of capital from more egalitarian to less egalitarian liberal regimes, and from liberal to illiberal regimes. These would assure that capital would not be free to flow into tax havens and that liberal peoples would not be caught in wasteful competition to attract foreign investment. The charter would not rule out transnational investment, but would subject it to oversight, or perhaps channel it through a jointly owned investment bank. Rawls frowns on liberal peoples’ use of financial incentives to induce the illiberal to become liberal. So, he can have no objection to a compact between liberal states to prevent capital from undermining liberal democracies. In fact, without an assurance of a sufficient degree of distributional autonomy, political liberalism cannot be stable anywhere.

Similarly, a liberal charter would have to include some provision to prevent a country like the United States from leveraging its dominant military or financial position to exercise undue influence on the political decisions of other peoples.Footnote ¹⁰ So long as some liberal peoples rely for their military security on the protection of another people, there will be opportunity for the latter to undermine the distributional autonomy of the former. While it may be possible to merely include a principle proscribing one people from trying to influence the internal political decisions of another, the easiest and most secure way to enforce such a prohibition would be to prevent any one people from occupying such a central position. The liberal charter would probably include, then, provisions to ensure that no people was dependent on another for its security, either by requiring that each nation be militarily self-sufficient, or by creating a genuine global security force that did not disproportionately rely on one country, as NATO relies on the United States.

Finally, while trade in general is not a threat to distributional autonomy, and a global regime of capital controls could be married to extensive free trade, distributional autonomy is threatened when one country’s economy is dependent on another’s, the way Ukraine is dependent on Russia. This, too, the liberal charter should prohibit, to the extent possible.

One thing that has emerged from this discussion is that Rawls’s conception of global justice, his ‘realistic utopia, ’ is more utopian than he is generally given credit for. The central feature of neoliberal globalization is the systematic destruction of distributional autonomy, and it is precisely this feature which Rawlsian global justice (on our interpretation) disallows. The difference between Rawls’s approach and that of the cosmopolitans is that, while the latter push for not only major practical changes to the world order but also for major theoretical changes in how we conceive of and reason about the world, Rawls builds his theory on the acceptance of bedrock commitments of the present order, like national sovereignty and autonomy. In other words, the ‘realism’ of Rawls’s utopia is primarily theoretical, more about its accommodation of long-standing concepts which have define how most people think about global society, than about its lack of practical ambition.

IV. The real priority of global justice

The Law of Peoples has attracted a lot of criticism. With regard to the economic aspects of global justice in particular, there have been many arguments that Rawlsian justice, properly applied to the global sphere, requires an egalitarian distributive principle – whether a global difference principle or some other egalitarian principle. Most notably, Allen Buchanan (Reference Buchanan2000) and Thomas Pogge (Reference Pogge1994) have argued that, even if you accept Rawls’s stipulation that it is peoples, and not persons, who are represented in the global original position, you can still generate a strongly egalitarian principle of global distributive justice. These and other critiques take for granted, however, that the central issue of global justice is the unequal distribution of wealth across the world.

Rawls simply does not share this priority. The text of The Law of Peoples makes clear that in a world of more or less economically independent peoples, distributive justice is not a major issue, in his view. At least some of Rawls’s critics, especially Buchanan, accept this notion, and argue only that since we do not live in a world of economically independent peoples, distributive justice is still of great importance. Many of Rawls’s defenders, too, approach the issue in these terms. Joseph Heath (Reference Heath2005), for example, bases his defense of Rawls against global egalitarians on the fact that there in fact is not any global basic structure which could sustain a global egalitarian distributive principle.

This way of framing the debate, however, is entirely misplaced. As we have discussed, Rawls does not take the economic independence of peoples to be an empirical fact about the world on which he bases his theory. It is rather a normative consequence of that theory. Rawls, unlike both his critics and defenders, takes global political inequality, rather than global economic inequality, as the central issue of global justice (in keeping with the priority between the two in the domestic theory of justice). Decisions about economic structures and policies are political decisions, so protecting a country’s political autonomy means, among other things, protecting its ability to make economic decisions for itself. The first and most fundamental priority of liberal global justice, as we have shown, is to guarantee distributional autonomy. Once this distributional autonomy is guaranteed, we have arrived at the condition of economically independent peoples which Rawls seems to assume without argument in The Law of Peoples. It is true that Rawls never explicitly makes this case, but we believe that once this skipped step is ‘added back in, ’ so to speak, the whole thrust of The Law of Peoples becomes clearer and more compelling, and opens up a whole new and largely unexplored terrain in the area of global justice.

V. A Rawlsian globalisation?

What does this terrain look like? In other words, what would a global order based on the principle of distributional autonomy look like? We cannot provide a fully worked-out picture here, but some promising possibilities may be gestured at. First, the most significant step that individual states can take to protect their distributional autonomy is to impose some sort of capital controls, as discussed above, or what is perhaps less burdensome, impose a tax on exchanges of domestic and foreign currency (often called a Tobin tax). It may also be wise for states to negotiate minimum standards for environmental regulations, labor laws, etc. to avoid the race to the bottom which otherwise constrains their domestic actions. There would also likely need to be a coordinated international crackdown on tax havens, to further restrain capital flight.

Second, international institutions as they presently exist would have to be significantly reshaped, partly to rein in their tendency to interfere with states’ domestic policies and partly to allow every state equal influence on their structure and practices. The U.S.-and-Europe-dominated governance structure of the IMF would have to change to treat all states equally, for example, and the practice of attaching conditions to IMF aid would have to be either substantially revised or abandoned.Footnote ¹¹ It is not only global institutions, moreover, but sub-global international institutions which would need to be seriously reformed. The most notorious of these, the European Union, would certainly need at the very least to change its current set of economic policy rules, which are very neoliberal in character (limiting deficits and encouraging privatization, for example), and would probably also need to change the structure of its currently unaccountable (and German-dominated) European Central Bank. The investor-state dispute settlement process, or ISDS, which has arisen out of a number of multilateral trade agreements like NAFTA and which allows private companies to sue states which restrict their economic activity, would also need to change or be abandoned.

This is obviously no more than a brief sketch of what a just, Rawlsian global order would look like. One thing that has emerged even from this sketch, however, is that it is a global order: defending distributional autonomy does not require a withdrawal into autarky or nationalism. On the contrary, this is a deeply internationalist vision, one that requires substantial and sustained cooperation among states on an equal footing. This is particularly striking in contrast to neoliberal globalization, where states mostly compete rather than cooperate and are, as we have seen, on an extremely unequal footing. What we are advocating, then, is not an attempt to ‘push back’ or ‘undo’ globalization, but to push forward, to a new and better way for states and peoples around the world to coexist.

VI. Summary and conclusion

Rawls believed the ‘democratic peace’ hypothesis was true enough to warrant proposing a Basic Charter including both democratic and decently non-democratic peoples. The hypothesis is evidently falsified by the actions the (democratic) United States took against democratically elected socialist governments in Chile (Allende), Guatemala (Arbenz), and Iran (Mossadegh); but Rawls explains these away as ‘prompted by monopolistic and oligarchic interests without the knowledge or criticism of the public’ (Rawls Reference Rawls1999, 53).

How well-ordered democratic peoples might control such interests is too large a subject to broach here: it is enough to state that these same types of interests worked across borders against France (Mitterand) and Britain (Attlee). Given the clear threat that such interests have posed and do pose to the ability of liberal peoples to realize their conceptions of justice, we conclude with the observation that liberal peoples, who are the parties to the second original position, would recognize that a guarantee of distributional autonomy is essential to making democratic economic peace a durable reality. There is no reason to think that the merely decent peoples of the world would balk at a ninth principle that assured their distributional autonomy. In any case, the liberal peoples would insist upon it.