Dr Steven Davies is the Senior Education Fellow at the Institute of Economic Affairs
The FIFA World Cup, currently playing out in the United States, provides insight into many aspects of contemporary economics and politics. As people are starting to notice, it highlights several structural changes brought about by the globalisation process that has been going on since the collapse of Bretton Woods in the 1970s.
Because of its truly global nature (particularly this year with the expansion in the number of teams) and only being an event held once every four years, it provides a snapshot into processes that are changing the world through the way that they manifest in football at regular intervals. As people become aware of this through watching the World Cup so their reactions can tell us a great deal about what is going on in the politics of many countries right now, and what is driving it.
Football (and much of professional sport in general) is a good example of the way much business and commerce works in the globalised world. The product (football matches) is consumed mainly through the medium of television, and increasingly, social media. Although the teams that produce the product are physically located in a specific place and have a historic identity related to that location, the bulk of the fans of the globally successful teams hardly ever physically attend matches but rather watch them on television or other platforms.
Consequently, in addition to their historic local identities, teams such as Real Madrid or Manchester United or Arsenal also have a global brand identity, created by electronic media, that is detached from the physical location. This global fanbase is the main source of revenue, directly and indirectly. This is reflected in the composition of club teams, which now have little or no connection to the local community they originally grew out of and to which they are still physically tethered.
Instead, a globally prominent team will have players from all over the world. Increasingly this is spreading downwards into teams that are nationally but not globally prominent. At the level of national teams this means that teams representing countries such as the Democratic Republic of Congo (DRC) have teams where almost all of the players play for major clubs in Europe.
This phenomenon has now been repeated at the level of national teams, as the present World Cup reveals. There is only a weak connection between place of birth and the national team one plays for. Just as the connection between location and players has been swept away at club level, so it also has for a growing number of national teams. France provides the most striking example. No fewer than 99 players on the rosters were born in France, 8 per cent of all of the players at the World Cup. Revealingly, 54 of the 99 were born in Greater Paris, the most globally connected metropolitan area in France. French-born players are found on the teams of many other countries including several African countries. The French team itself has players born outside France, who could also have chosen to play for other countries.
The most notable case is Michael Olise, one of the stars of this World Cup, who was born in White City in western London, to a Nigerian father and a Franco-Algerian mother. There are many other cases of players playing for one country while being qualified by birth to play for another, such as Antoine Semenyo (born in England but playing for Ghana) and Erling Haaland (born in Leeds but playing for Norway).
All this has attracted much comment, a lot of which, particularly on social media, has been critical. There has long been an economically Left critique of contemporary football as dominated by money, the profit motive and a pure form of global capitalism. This is broadly true; it depends on whether you believe it is good or not. What has emerged at this World Cup is a critique from the anti-globalist Right.
The argument here is that teams like the current French or English ones do not represent the historic ethnic English or French identity but rather the results of inward migration and selecting players from all over the world, displayed in racially-loaded terms often asking “the question is which team has the best Africans”.
You have self-professed patriots declaring on X and elsewhere that they will not support the team of the country they claim to identify with, because of the ethnic composition of the roster. The reverse phenomenon of players born in developed countries but playing for an African or Middle Eastern country that they have other links to is less commented on but (confusingly at first sight) is also deplored.
What the now expressed ethno-nationalist response to World Cup teams reveals is a profound political reality. The emergent and rising nationalist Right in the developed world is a hostile response to capitalist globalisation and the changes it has wrought. To create the kind of world its exponents hanker for would require the reversal and unwinding of several decades of increased economic integration. This is near to impossible but, more importantly, the attempt would be disastrous, just as it was in the inter-war years. How can we understand the phenomena that so enrage the ethno-nats of the terminally online Right through economics?
An increasing part of the world economy, as measured by value added, consists of trade in immaterial services on a global basis. These include things such as law, finance and communications and entertainment - including professional sport. The global market in these services is the result of technological innovation, particularly the growth of computing and global networks for information transmission and exchange and broadcasting, made possible by satellite telecommunications.
In services of this kind, the main productive resource is not fixed capital or plant, which by its nature is relatively immobile and linked to a specific place, but human capital, the skills and talents of individuals. That means that the bulk of the revenue created by the products will flow to the bearers of that human capital (individual people) in the form if wages and other emoluments. This can be see very clearly in football, where almost three quarters of the income flow goes in player wages.
The highly productive and potentially highly rewarded individuals (players) can ply their trade anywhere in the world. Given that, they will migrate to and cluster in the places where their human capital will attract the highest return. Their high marginal value to employers means that they are truly and practically globally mobile, whatever their origin. The globalisation process creates a class of global nomads who can and do work and live in many places all over the world, and the number of places where they can base themselves is steadily increasing.
Footballers are simply the most visible instance of this but they are only one relatively small instance out of many. Most of the focus on migration and immigration is on the movement of people, often unskilled, from the global countryside (the rural parts of the global South) to metropolitan areas in the developed North. But there is also a large and growing migration of a different kind, of skilled professionals into both developed and less developed parts of the world - from London to Dubai, Lagos or Luanda, for example. This kind of migration is originally of professionals from the developed world to other locations of the same kind or to locations in the less developed world but increasingly it involves trained professionals from the global South, notably India, but also the MENA region and South-East Asia. In the case of footballers, the sources of the migration are even more widespread.
What the World Cup reveals is the other side of this. For the globally mobile professionals (and companies in many of the industries, though not yet sports teams) national or citizenship status becomes a matter of choice, or even a tradable good. The professionals can and do view citizenship as a bundle of benefits and obligations and are in a position to pick and chose between different offers (nationalities) or to switch and change from one to another. There is no longer for this growing category of people (or for the much larger category of unskilled service workers at the opposite end of the income scale) a clear or natural connection between place and location , of birth or residence, and political identity (citizenship or national identity). Citizenship has been deterritorialised as a result of globalisation.
Interestingly, the players do show strong commitment to the team they play for, whether at club or national level. Increasingly the two are becoming very similar for many traditional nations. Team with a global following have fans or followers all over the world and project an image or set of values that is meant to attract and consolidate that fan base. The players in turn are often very loyal to and identify with that transnational club identity. Because of the nature of football, that identity does have a territorial aspect but that is not national, it relates rather to the city where the team is based, so places such as Paris, London, Milan. Munich or Buenos Aires.
National teams are increasingly, as noted, non-territorial and composed of representatives of global diasporas or the parts of those diasporas located on the territory of the national state. The diasporas, an increasingly central part of the world system in a way that was once only found in a few cases (Jews, Armenians, Lebanese, Fukienese) are the product of the stirring of the global population pot by economic forces plus the way modern telecommunications makes retaining contact much easier.
All this illustrates something central about the contemporary world. The process of capitalist globalisation brought about by free capital flows, freer trade, and much easier and instantaneous communication has had the same kind of results that an earlier episode (driven by railways, the telegraph, and the iron-hulled steamship) did between 1870 and 1924. It has undermined and started to deconstruct the sovereign territorial states of the later nineteenth and twentieth centuries.
Instead, we are in a world of networked city regions where Paris and Kinshasa have in many ways a thicker connection than either has to their hinterland. We have a world of complex and entangled personal and familial connections that stretch across national borders and around the world, with moving workers (whether labelled as ‘immigrant’ or ‘expats’) the creators of this, mingling with intertwined diasporas that provide much of the structure. Identity and legal status such as citizenship have become only loosely connected to sovereign territoriality for a growing number.
At the same time, there are historic and territorial based identities and cultures that interact with these. Ine of the keys to relative success in this world is the degree to which such identities can be open to and attractive to people from other parts of the world. The World Cup a sudden revelation of this new reality. What you make of it is a normative judgment, depending primarily on whether you conceive of human flourishing in collective or in individual and voluntarist terms. I take the second view.
What we’re reading:
Stevenson’s rocked it. For CityAM, Damian Pudner has asked one of those questions to which the answer comes pre-loaded: surely Gary Stevenson is smart enough to know a wealth tax won’t work? Everyone’s favourite (?) trader turned class warrior may have succeeded in popularising a wealth tax, but they have failed where tried because of how difficult they are to administer and the tax avoidance and capital flight they encourage. Kristian Niemietz has more.
Maggie’s world. Our Director General has been at the Cambridge Union, arguing in favour of Margaret Thatcher being a liberator of the Proletariat. In 1979, she inherited a country where “29.2 million days were lost to strikes”, where the trains didn’t run and the grave diggers and the binmen didn’t work, and she transformed it. By taming the unions, reducing inflation and giving millions the opportunity to own their council homes or shares, she empowered the ordinar British worker.
L’AI, c’est moi. Tom Tugendhat has written for the Wall Street Journal, suggesting that many modern governments are hampered not by a lack of resources or good intentions, but because they are held back by outdated bureaucratic processes, unwieldy data, and inefficient control pathways. He argues that introducing AI provides an opportunity to streamline the state, improve services and detect fraud. Countries who adopt AI, Tugendhat hopes, will better serve their people.
Tribunal tribulations. Sticking with pieces by Tory MPs, Clare Countinho has outlined in ConservativeHome how Britain has handed control over crucial economic decisions to courts, tribunals, regulators and other unelected bodies, creating what she brands an ‘economic dictatorship’ than dents both democracy and growth. Judges are making subjective judgements on the values of different hobs while litigation funders are encouraging endless claims. A reset is required.
USA! USA! USA! Back across the Pond at Reason, Jason Russell has made the case that Team USA could one day win a men’s World Cup – with enough immigration and capitalism. Those are the forces, he argues, that have traditionally made American great, expanded the talent pool and provided the funding for the game they call ‘soccer’. Openness and economic dynamism are the key to footballing successful, not restrictiveness or government planning.