Aired October 5, 2005 - 17:59   ET
(http://transcripts.cnn.com/TRANSCRIPTS/0510/05/ldt.01.html)

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

DOBBS: My special guest tonight is one of the world's most imminent philosophers and economists and social thinkers.

John Ralston Saul challenges conventional orthodoxy by arguing that globalization has run its course, and that nationalism is reasserting itself all over the world. John Ralston Saul is the author of the new book "The Collapse of Globalism and the Reinvention of the World." It is great to have you here.

JOHN RALSTON SAUL, AUTHOR, "THE COLLAPSE OF GLOBALISM": Wonderful to be back.

DOBBS: If globalism is dead, I thought we were told that all borders are gone and that this is just one big, happy world.

SAUL: Military spending has just gone over a trillion dollars. It's only 6 percent below the height of Cold War military spending. Arms sales are up about 20 to 30 percent a year.

Europe is stalled. Self-interest is coming back everywhere inside Europe. A whole bunch of new countries in there from Central Europe who are really interested in strengthening their nation-state. Fear of immigration in Europe. Fear of immigration in a number of places.

Return of racism. And interestingly enough, a return of a whole bunch of things that were supposed to disappear. I mean, globalism and the accompanying economics were supposed to bring debt free governments.

DOBBS: Hmm. Now, that's really worked out, didn't it?

SAUL: The United States now has the biggest debt in the history of the world, I think of any government. And it's happening all over the place. European governments are slipping into debt.

DOBBS: Debt mounting for the United States. One of the statistics that I find most incredible -- I don't know what you think, but it strikes me -- when we look at current account deficit, which is boring to people, they don't pay much attention to it. But now it's about -- a little over 6 percent of our GDP in this country. The United States now has 70 percent of the total current account deficits in the world. It's extraordinary.

SAUL: Well, when things start going wrong, the most powerful country in the world, once the British Empire, et cetera, when it's going well it really works for the most powerful country in the world. When it's going wrong, it goes on your back. I mean, you become the reserve good and everything that's wrong. And I guess it's one of the signs of the imbalance out there.

And of the fact that people didn't really think their way through what they meant when they launched a rather simplistic theory of international economics and started saying, look, from now on, economics are going to lead the way. We're going to look at everything through the prism of economics. And they didn't really look what the implications of that were.

DOBBS: Well, I can't tell you how many people told me, 10, 15 years ago certainly, you know, the borders, the nation-state is dead, borders are immaterial, technology will overwhelm all of the base impulses of mankind. And to speak of the national interest is really so declasse and primitive, we've evolved to a new level. Absurdity.

SAUL: Well, the nation state's probably stronger today now than it's been since about 1945. And it -- and there can be positives this. There can be great negatives and great positives.

DOBBS: This is the want of human history.

SAUL: Yes. I mean, I think we're in an interim period. I think, you know, a great truth comes to an end. The elites don't notice, which is why they're so disturbed by this sort of conversation, because they made their careers on the basis that it's inevitable, for at least as long as they're in power, or in their job.

DOBBS: They're shuddering at the United Nations as you speak.

SAUL: Yes. And then suddenly you slipped into this interim period like a vacuum where there are all these contradictory forces going on, banging up against each other. And that's our opportunity. That's the moment of choice when citizens, nation states, can actually slightly direct how we come out of the vacuum. And that's what's so interesting about this moment. We don't have to be the victims of inevitability for the next 25 years.

DOBBS: Are you suggesting we might be still -- that there is such a thing as seizing one's destiny and making choices?

SAUL: To some reasonable extent, yes. I think it's entirely possible.

DOBBS: Well, Washington now is shuddering.

SAUL: Well, you know, I think we have to ask the really big questions. I mean, most of the theories that been done for the last 25 years are 19th century theories. They were designed for societies living in scarcity. We've been in surplus, even though there are poor people -- we've been in surplus for 50 years and using economic theories based on scarcity. This is one of the reasons why it doesn't really work.

We went into the system that was supposed to produce more competition. Today we have oligopolies and monopolies at the international level. In fact, I believe -- and this is maybe the most difficult thing for some of the people to accept -- that we've actually -- we're actually slipping towards a pre-capitalist period, back into something that bored us to death at school, called mercantilism, which is when you had companies like the British East India Company and the Hudson Bay Company that controlled international markets from, you know, the silk worm through to the lady in a ball gown. And there was no real competition. And that is the opposite of capitalism.

DOBBS: What the British called in those days, a level playing field, I believe, and what mercantilism, which the Chinese practice as well, the United States and other countries who have a mantra about free trade. What they haven't noticed is the Chinese are great mercantilists and have a national agenda, interest, initiative and a plan. Give us the sense of what fills the vacuum in your view.

SAUL: Well, I think there are a couple of possibilities. You know, on the negative side, you have a continuing rise of negative nationalism, which we're seeing.

DOBBS: Right.

SAUL: You know, racism, nation states closing in on themselves. There's a rise in fear. We see this everywhere, right? And that fear if it reaches a certain point can overtake anything.

DOBBS: Give us the positive.

SAUL: The positive is frankly that even though they're not in politics, there are more young people involved in public affairs today than ever before in history. Now, they're in NGOs, they're in the parallel movements. But if you can get a reasonable percentage of them to come over into elective politics and humiliate themselves on a daily basis, you know, which is what happens, then you really have a wave of possibilities of new ideas. But they've got to come into the mainstream.

DOBBS: To come into the mainstream. There are liberals out there who are thrilled to hear what you're saying. There are conservatives recoiling.

SAUL: Well, some conservatives might like it too.

DOBBS: I was going to say -- and at the same time, there are those saying, wait a minute, the national interest is probably a good thing to reassert. It doesn't mean one is necessarily unsophisticated to recognize there is such a thing as a national interest that sometimes a system of government makes possible an economy and standard of living.

SAUL: Well, you know, in the end it was very naive and unsophisticated to believe that where you come from doesn't matter.

DOBBS: Right.

SAUL: And that -- how could you turn to the most educated people in the history of the world and say, you don't have any power, abstract markets are going to determine where you're going.

DOBBS: John Ralston Saul, it is always good to have you here. I could talk with you throughout the evening. We appreciate it.

SAUL: Great to see you again.

DOBBS: I've got a producer who thinks I've just done that. Thank you very much.

Still ahead, the results of tonight's poll. A preview of what's ahead tomorrow.

Stay with us.

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