Rebellion is born of the spectacle of irrationality… But its blind impulse is to demand order in the midst of chaos, and unity in the very heart of the ephemeral.

Albert Camus The Rebel (1951)

After many years of tranquility consisting of an uninterrupted and general improvement in living standards and a victory over the communist world, the Western world and especially Europe, who are committed toward achieving economic and monetary union, again face uncertainty. Governments seem to no longer have the compass that would allow them to find the way to a satisfactory growth, even while the idea that we could enter an era of secular stagnation emerged.

A disorder then establishes in acts and in minds leading to the irrationality that can emerge from a world’s state resulting from an undermined consensus and a return to old and discredited ideas. A demand for order in the midst of chaos is thus all the more necessary.

It is certainly difficult for the economist, concerned with rigor and recognition, to conceive disorder and irrationality. The economist wants to imagine a world in which equilibrium is assured by some sort of Laplace’s Demon, intelligence that knows all the forces that animate nature and for which nothing would be uncertain. He/she may think that the globalization of trade could enable the emergence of a global economy made up of ultimately autonomous individuals, who would no longer have to yield to any regulation impeding the proper functioning of the market, which would then curiously become more similar to the supposedly omniscient planning of the centralized economies of the communist era.

This globalization is, however, far from marking the end of history, as would agree an economist who neither believes in perpetual tranquility nor permanent chaos. The necessary order is always fragile. It is major and economic events that, putting societies in great difficulty, reveal the true nature of the problems these must solve in order to continue to exist. Financial instability, mass unemployment and international trade imbalances are never definitively overcome. These ills do not result from a divine curse, nor do they constitute a black swan. They are the result of individual and collective behaviors whose coordination is disrupted by the irruption of novelty, when its failure, brought about by finance mistakes, brings the economy out of its stability corridor.

Wealth creation and individual as well as collective well-being improvement conditions are yet and always to be implemented, simply because they reflect societal choices and policy arbitrations. There is no ready to use toolkit available in the hands of economic experts who would only have to designate the best possible decisions to policy makers. Conflicting interests are then inevitable and the political debate is necessary to make possible, through interest negotiation, a wealth creation process.

Without doubt there are forces contributing to secular stagnation, as witnessed by societies over centuries or millennia. It is not possible to rule out the fact that episodes of strong growth that studded the past hundred and 50 years are of an exceptional nature. There is, however, an intellectual laziness specific to economists who want to stick to the effects of phenomena perceived fundamentally as extraneous to the economy, be they natural constraints, technical revolutions or demographic movements.

The weight of beliefs combined with that of general poverty could, over the centuries, impose the vision of a closed world, subject to forces over which humanity has no control, where a human being is the toy of God or of relentless historical developments. The rupture, of which contemporary societies are heirs, came from the moment when man freed himself from these chains and thought himself master of his destiny, for better or for worse.

In this new world, there are no peculiar dynamics of populations, technologies or preferences, that is, independent of institutions. Technologies as preferences do not exist prior to economic and social choices that would be dictated by them. They are on the contrary, the result. Innovation, far from being reducible to the simple diffusion of scientific and technical knowledge, is the economic and social process that makes them emerge at the pace of the ruptures it causes. Private behaviors and public policies, conceived in response to the distortions and imbalances inherent in evolution, determine sequences and bifurcations that structure evolution step after step. Time flows in one direction, but there seems to be no single way out, no historical fatality and predetermined path. Experience shows that there are several effective varieties of capitalism that current globalization is jeopardizing, but without implying that they should be extinguished in favor of a presumed optimal variety.

Episodes of tranquility, steady growth and great moderation, as observed in the early 2000s, created the danger that the weight of uncertainty and irreversibility may lose attention. The effects of time were suspended for a moment, or, more precisely, the mechanical and static vision of a reversible time, which was too often approved by economists, prevailed until instability once again became topical and the ignored forces of uncertainty and irreversibility generated disorder. It was now time to try to contain them and to this end to recognize the contingency of the laws that guide the behavior of individuals and the evolution of societies.

The new globalization, which is none other than the last break to date specific to the essence of capitalism, does not escape the dilemma of contingency and ambiguity of the passage of time. Ecological transition, which is the other dimension of the changes in progress, also does not escape this dilemma. The nature and causes of the wealth of nations have not significantly changed since the beginning of industrial capitalism.

Growth continues to be the fruit of the emergence of innovation that begins a period of turmoil, distortion and creative destruction, whose difficulties are related at the required time to produce the new state of the world. Coordination requirements are not less than in the past. Stakeholders are always entrepreneurs and financiers who have to recurrently arbitrate between the short and long term, as well as between value diversion and creation. It is still public authorities facing the same dilemma and guarantors of the institutional and organizational choices that have to shape the markets, structure social links and ensure the viability of ongoing transitions.

Today’s world, like that of yesterday, is torn between short- and long-term requirements, more fundamentally between yielding to the belief in a bright future laid out in advance, whatever happens in the immediate future, and the conviction that only the mastery of current disorders makes it possible to envisage and build a reasonably quiet future.

Conviction should therefore take advantage of the need for political debate to find, through interest negotiation and preservation of diversity, the way of controlling time and creating wealth. This is the essence of a political as well as economic liberalism that recognizes the place of both the market and public authority in this project, which is always working on constituting individuals in society. This is also the essence of democracy that includes the political form likely to ensure the proper functioning of an economy whose evolution is never written, but is carried out on the way. Thus, tension is maintained between a need for stability at the heart of the exercise of democratic power and the systematic questioning of economic and social organization.

In view of this challenge, policy makers, far from the claim of constraining the real starting from the absolute of thought, have the duty to rely on observation to analyze the conditions in which it is possible, along the way, to maintain a permanently fragile order. Instead of responding to the very easy and ultimately dangerous search for the uniformity of rules recognizing the self-regulation of markets that would have been identified by economists in quest of the ideal, they have to foster institutions that guarantee a spirit of measure and compromise.

The thread that links the following chapters is in line with the perspective outlined above and is based on the conviction – stimulated by current debates on the nature and characteristics of ongoing globalization – that major shocks, in creating enormous difficulties for human societies, reveal the true nature of the problems that these societies must overcome to continue to exist and progress.

Such phenomena, which generate significant economic and social upheavals, are by their nature processes whose configuration cannot result from a “choice” between several alternatives with outcomes that could be established a priori.

By “process” we mean an evolution whose successive stages and orientations depend on trial and error, which at every moment creates imbalances and conflicts requiring specific coordination to address and resolve them in order to make society viable and prevent it from collapsing.

This coordination activity naturally takes place over time in accordance with the evolving nature of ongoing changes and with the aim of handling the obstacles that arise at every stage, as a result of the gradual transformation of production capacity at the heart of changes in the operation and functioning of the economy.

The required arbitrations are based on established institutional and organizational forms that guide both private and public actions conducted over time. These forms determine the time horizon that is crucial for the type of decisions taken and the results achieved.

Chapter 1 deals with the split that has occurred in economic facts and ideas since the 1970s with regard to the conditions of regulation of economic activity, in other words relations between the market and the State. The new transition undertaken is perceived as oscillating between an idealized world, in which all regulation would be excluded because it has become unnecessary and a lived world, whose viability would not in any way be assured.

In Chapter 2, it is argued that innovation presented by current globalization does not exempt the need to consider the permanent features of structural changes that are characteristic of market economies. The phenomena of creative destruction are regarded as being at the heart of the change process, requiring the implementation of coordination powers with the conditions governing its exercise being largely dependent on stakeholders’ ability to fit into the long term.

Chapter 3 details the entrepreneurial function by proposing to contrast the entrepreneur who coordinates a wealth-creating activity and is part of the long term, with those who exercise their talent mainly for the purpose of diverting value and are part of the short term. The nature of the company is thus questioned at the same time as the ambivalent role of so-called market imperfections is highlighted.

Chapter 4 establishes that two types of financial intermediaries (shareholders or bankers) correspond to the two types of entrepreneur according to the relationship that they have with time. Some engage in the long term with the companies they finance, while others speculate in the short term. Thus, the issue is not the relevance of finance in itself but the degree of patience of capital owners involved in the regulation and organization of the financial sector inevitably altered by globalization.

Chapter 5 focuses on demonstrating that the recent widening of inequalities is largely the result of the behavior of entrepreneurs and financiers, their choice, conditioned by institutions, of prioritizing immediate results and formation of what amounts to annuities. This evolution is not viewed as the testimony of the emergence of a new world order responding to new technological or market conditions but as the outcome of political and social choices compromising the stability of national societies and the international society.

Chapter 6 argues that the control of change requires the recognition of the role of institutions, which are not reducible with regard to the intangible rules embodied in numerical indicators but are diverse because of historical, cultural, social or political differences revealed by their national roots. Nations are therefore still regarded as essential places of coordination since distortions are most visible and felt at their level and have to be addressed under the condition of mastering the articulation of imbalances in time and space.

In Chapter 7, attempts are made to dissociate classical from bastardized liberalism that structured the dominant discourse on globalization and seeks to reduce public action to the application of intangible rules enacted by the doctrine. It then serves as a reminder of what the common good, rule of law and liberal democracy are all about, the real purpose being to make the necessary arbitrations to respond to recurring conflicts of interest and reconcile equity and efficiency in an open society. It then seeks to establish the danger of globalization if it was to follow a slope leading to dualism within various societies and the withdrawal of States that would end up favoring confrontation because of the inability to rely on regulatory cooperation.