Ulysses Unbound

Here’s a question I often bat around with graduate students in my International Political Economy seminar: In book 12 of the Odyssey, how do the shipmates know which Ulysses to trust?

You know the story. Ulysses and his crew have been on Circe’s island for a year. They’re finally about to depart when the goddess takes Ulysses aside and warns him of the dangers that await them. The first of these is the “piercing songs” of the Sirens. “So listen,” she says, “I will give you good instructions; another god will make sure you remember.”

Circe tells Ulysses to put wax in his sailors’ ears but that he can listen to the Sirens if he wants to — as long as his shipmates bind him “hand and foot” to the mast: “So bound, you can enjoy the Sirens’ song. But if you beg your men to set you free, they have to tie you down with firmer knots.”

As their ship approaches the Sirens’ sharp rocks, the wind dies down, they pull the sails, and they begin to row. As predicted, Ulysses yells out to his men to set him free. He is still their captain. But instead of obeying his orders, Eurylochus and Perimedes stand up and “tie him down with firmer knots.” How, I ask my students, do they know to trust the first Ulysses over the second? How is it that as readers, we never question their choice?

Much of the challenge of designing political institutions — whether they’re national constitutions or international treaties — comes down to this question. Which self should we endorse? For that matter, it’s also the challenge we face when setting up the mechanisms of our own individual self-rule: the criteria by which we decide to keep or break the promise to ourselves not to have a second glass of wine at dinner, knowing that it’s going to cost us several hours of sleep later that night. With which self do we identify, and which self should we seek to empower?

The Sirens are the classic representation of the passions. We are all familiar with individual human passions. They’re the stuff of soap operas — anger, lust, jealousy — and, increasingly, the distracting pulls on our attention from our devices. All of them can turn us away from the long-term goals we set for ourselves in our calmer, sober moments.

What about political passions? They might be thought of as short-term gestures aimed at consolidating power that come at a long-term cost to national or global welfare. Think of leaders pushing for lower interest rates ahead of an election, in ways that juice the economy but later produce inflation — after the votes are cast. Or enacting distortionary tariffs to appeal to domestic import-competing industries, in ways that raise consumer prices and impose costs on foreign producers. Or invading a neighbouring state to fulfill imagined historical narratives, at the cost of civilian lives and global stability.

These will all sound familiar. Indeed, we seem to be living through an era of political passion. I think of it as an era of appetite — as distinct from prudence or reason. It’s quite apt, in this respect, that Homer’s Sirens sing not of sex — the seductive mermaid trope is a later addition of medieval Christianity — but of knowledge. It’s not knowledge of arithmetic or the periodic table — but of “past glory.” The Sirens sing a song of nostalgia.

Individual passions share much with political passions, but there is one notable difference. When it comes to individuals who break an earlier commitment to avoid wine at dinner, they are the ones incurring the cost at 3 a.m. The conflict between passion and prudence plays out internally. That looks quite different in the case of governments, which have an audience made up of voters, markets, and other states. That audience is acutely aware of the temptations governments face — and it acts accordingly.

A political leader may have no intention, in their heart of hearts, to print money to juice the economy, to impose barriers on trading partners, or to invade a neighbouring country. But intentions are invisible, and talk is cheap. The problem comes not only — or even mainly — from ceding to temptation but from the mere existence of that temptation, when there is no constraint against it. In other words, temptation is priced into the market: states see less investment, lower growth, a higher cost of credit, and greater odds of conflict than they otherwise would. These costs arise not from anyone’s malice or irrationality but from unenforceable promises.

This is the problem of credibility, and it is the problem that has preoccupied me since I earned my doctorate twenty years ago, and it remains, to my mind, the central challenge of global politics. How do sovereigns make promises believable when breaking them is always possible?

The word “credit” is apt in this case: it comes from the Latin crēditum, which comes from crēdere, which means to trust or to believe. The cost of borrowing reflects the extent to which the borrower is believed. When the borrower is the king, there is no reason to believe him. My newly adopted home of Britain happens to offer the textbook example of this phenomenon: the Glorious Revolution of 1688, which was mostly about religion but arguably had a greater impact on bond yields.

Before 1688, when the Crown was desperate for funds — as it often was — it did things like seize merchants’ bullion from the Tower of London, effectively expropriating savings accounts. That did little to improve the Crown’s standing among creditors. Then came revolution. By subjecting borrowing to parliamentary consent — by limiting the sovereign’s sovereignty — Parliament inadvertently solved the Crown’s credibility problem, with immediate fiscal consequences. Within a decade, government borrowing rose more than tenfold, and the yield on long-term debt fell by half. By the early eighteenth century, Britain had the deepest, cheapest capital market in Europe, paving the road to its emergence as a global superpower over the following century.

There’s a great irony here: monarchs gained the ability to do what they wanted — wage war — thanks to the very shackles that were meant to restrain them. This irony is a recurrent feature in cases of effective self-binding, and that’s because self-binding does not come naturally. It was Parliament that bound the Crown, not the Crown that bound itself in a moment of enlightened self-abnegation. Such moments do occur, but they’re rare. Because states, like individuals, are rarely enthusiastic about restricting their options.

Yet, over time, that paradoxical insight — that we might benefit from having fewer options — does emerge in unexpected places. Even the most autocratic autocrats might recognize that being limited to cheap talk turns out to be very expensive. That’s why we see dictators doing odd things, like pegging their currencies to the American dollar. Cuba under Castro, Iraq under Hussein, Venezuela under Chávez — they all, in various ways, tied themselves to the symbol of their ideological foe and surrendered their monetary autonomy to the United States. Why? Because on some level, these dictators understood they had too much freedom and they would pay for it with lower economic growth. So they sought an external anchor. In these cases, the restricting of sovereignty isn’t some unfortunate by‑product of an otherwise good technical solution: it’s the point.

When it comes to constitutional self-binding, the go‑to metaphor is that of “Peter when sober” tying down “Peter when drunk.” It’s a line that I often use in lectures — but it’s pretty misleading. First, because it’s a reference to Peter the Great, who was seldom sober, often drunk, and not given to much self-restraint. Second, because as in the case of the Glorious Revolution, the binding is often done by others, rather than by the self. Third, because those rare constitutional moments — in the history of international relations, we think of the Peace of Westphalia of 1648 or the Congress of Vienna of 1814 — are not dispassionate. They are periods of transition and uncertainty, often in the wake of collective trauma.

It’s arguably only in that state of mind that rational actors are willing to trade the common understanding of freedom for long-term stability. The same is true of the individual. It’s after the overdose, the marital rupture, or the social humiliation that individuals enter a brief window where the cost of ceding to temptation weighs enough on the mind to overcome natural inclinations. It’s only then that we may truly be able to design better futures for ourselves.

The postwar order we’ve inherited, and that many think we are now exiting, also came out of such a story. It was out of the trauma of the Great Depression and the horrors of the Second World War that countries set bounds on their exercise of power by creating a set of global institutions. Most notably, the newly hegemonic United States agreed to convert its power into a set of rules — a favourable one, to be sure, but one that nonetheless tied its hands.

Over the following decades, the U.S. was frequently criticized, and rightly so, for selective compliance, double standards, and a measure of hypocrisy. Yet that should not lead us to underestimate what a historically singular moment it was when a hegemonic power proposed to bind itself. Suffice to say that this was not what Britain did during its hegemonic moment.

At this point, you would be justified in asking: If the powerful all gain so much by binding themselves, by exercising restraint, then what on earth is going on? The current U.S. administration has turned its back on the very notion of global governance. It has undermined the independence of its central bank, and thus its own monetary credibility. It has adopted tariffs as a first resort, imposed export bans on goods it judges strategic, turned to sanctions as a routine means of leverage. It has been busy “weaponizing interdependence,” to use a now commonly invoked phrase. It has suspended treaties, paralyzed international judicial bodies, and threatened to invade allies. In every case, it has undermined the credibility of its promises. Political economy theory tells us that these are costly moves. So what are we to make of them/

The first thing to recognize is that the costs have in fact been lower than most observers expected. When trying to explain why, policy wonks have turned to the glib acronym “TINA,” which stands for “there is no alternative.” There is currently no alternative to the dollar as a global reserve currency, no safer asset than U.S. Treasury bonds, no international payment clearing system that doesn’t pass through U.S. banks, and no major economy with a higher productivity per worker than the U.S. The result is that capital has nowhere better to go — especially given the happenstance of an AI‑driven growth spurt, a lucky twist of fate that has undoubtedly subsidized much of the recklessness we’ve seen from the Trump administration.

It’s striking that TINA is most associated with Margaret Thatcher, who used it to claim that there was no alternative to market discipline: countries, as well as their citizens, had to live within their means or be punished by the market. Forty years later, that logic has been inverted. The markets that were meant to restrain the state are now captive to it — at least in the case of the hegemon. The U.S. is spending down its accumulated stock of hegemonic capital.

This, I think, muddles the clean distinction between passion and reason. The fact that both equity markets and bond markets have hardly budged in the wake of a long list of disruptions suggests that the U.S. had, in fact, been leaving money on the table. And we should not expect that money left on the table will remain there forever — eventually, someone will take it. And someone has.

It also suggests that a market correction, if and when it comes, is likely to be a sharp one. “How did you go bankrupt?” Mike Campbell is asked in Ernest Hemingway’s The Sun Also Rises. Like him, we might find ourselves answering, “Two ways. Gradually and then suddenly.”

Beyond these contingent factors, there are three more reasons to explain what we’ve been witnessing in this Age of Appetite. The first may simply be that the urgency behind that moment of self-binding has been forgotten. The cost of global instability is too far removed in our collective memory. It now feels foreign. Remember Circe’s line: “I will give you good instructions; another god will make sure you remember.” It’s an odd one, and there’s no further reference to it in the Odyssey. It’s like Chekhov’s gun appearing in chapter 1 and failing to go off by chapter 3. So what’s it doing there? One possible reading is that information isn’t enough: one needs a pressing, potent reminder. You need a mix of fear and resolve that decays over time. And it might be that in practice, this state of mind requires regular renewal. Like in marriage, maybe, we need to periodically work ourselves up and renew our vows.

That’s in part because circumstances change. It would have been a lot to ask of the negotiators at Bretton Woods to imagine that a few decades later, China, a formerly closed socialist economy prone to widespread famine, would embark on the most rapid export-driven industrialization in human history, decimating established industries in developed countries.

There’s a term of art used to describe the unknowability of almost every agreement: “incomplete contract.” Agreements are incomplete because none can predict all the possible states of the world to come. That’s why the rules are never absolute. They can’t be: rule designers wouldn’t allow it.

This goes to what I think is the second explanation for what we’re witnessing, which is that the rules themselves have fallen short. Consider the international trade regime. In the case of global trade, we know exactly who the Sirens are — because they have names and mailing addresses. They’re the dairy industry in Quebec, the sugar industry in the U.S., and the steel, automaking, and aerospace industries in just about every country. Legislators are said to be “captured” by these import-competing groups. Even in the best of times, policy makers can’t restrain themselves from offering these special interests protection.

My favourite line by a politician comes from Jean-Claude Juncker, the former president of the European Commission: “We all know what to do, but we don’t know how to get re-elected once we’ve done it.” If we think Juncker is on to something, it further blurs the line between passion and prudence, doesn’t it? The inability of democratic leaders to do the right thing stems from the design of electoral systems that aggregate voices unevenly and let geographically concentrated groups — big sugar, big corn, big dairy — speak louder than the general electorate.

The purpose of trade agreements is to allow legislators to turn to these powerful groups and say, “Look, I’m on your side, but my hands are tied.” Here’s that same irony again: weakness is strength. Being bound improves policy makers’ bargaining position with corporate interests.

Global rules recognize the potency of these political passions in another way. They recognize that even after binding themselves, policy makers might be forced to give in on occasion. That is why all global agreements contain some measure of flexibility: everyone agrees that when countries face unforeseen, exceptionally hard times, they may be allowed to suspend the rules. But allowing for flexibility is tricky, because it is also prone to abuse. Who gets to decide what constitutes exceptional hard times? How do you design exceptions that can be used when necessary but that won’t be abused? That question is especially salient in the most powerful exception at the core of the trade regime, which is the national security exception. Countries are allowed to impose otherwise illegal trade barriers if their national security is at stake. This is the exception that the U.S. has been leaning on to justify its otherwise extra-legal trade barriers.

The still-ongoing debate in the trade regime is about whether an international institution like the World Trade Organization is qualified to judge when the exception applies. The WTO has ruled that it is qualified; the U.S. has always held that it is not. In so doing, the U.S. has arguably proven right a famous phrase by the legal theorist Carl Schmitt: “The sovereign is he who decides on the state of exception.” In other words, sovereignty is determined not in the rule making, or even in the commitment to those rules, but in determining when the rules cease to apply. Schmitt wrote that line in 1922. A decade later, he joined the Nazi Party.

Even if we recognize that there is truth to Schmitt’s chilling observation — and I think there is — that still leaves the possibility that the sovereign can be constrained from within. Which may be happening now. There’s a case currently being decided by the U.S. Supreme Court that examines whether the president has wrongfully invoked emergency powers to justify trade barriers. And while I have few illusions about the current makeup of the bench, this is a rare instance where the court may actually restrain the president.

Yet the fact remains that at the global level, if exceptions are necessary, and if the sovereign is he who decides on the state of exception, then the entire edifice of international law rests on a type of informal coordination. On shared taboos, conventions, and accumulation of state practice. This might seem disheartening, but the remarkable thing is that it can work. In the case of the trade regime, the taboo held for sixty years. Everyone knew about the option of invoking national security — it has always been referred to as “the nuclear option”— and yet no one did. That’s not because it was hard to use but because it was too easy. There was widespread recognition that if anyone pushed that button, the meaning of the rules would be dissolved. Until a political entrepreneur came along, willing to upend international norms and state practice.

A common post-mortem of the trade regime among WTO wonks is that Trump’s reliance on the national security exception was precipitated by a series of judicial decisions that made other more conventional flexibility provisions increasingly difficult to use. At the time, I cheered on these decisions as victories of law over politics, victories of reason over passion. In retrospect, this may have been my own hubris. The result was an agreement that no longer reflected its “political antecedents,” to use the term employed by E. H. Carr, the British historian, in The Twenty Years’ Crisis. It’s a reading that is generous to the rule breakers, but it’s one worth considering. There are solutions to this problem. We can design better rules. But better does not mean more perfect. It means optimally imperfect.

There’s a third possible account of our Age of Appetite, and it may be the most disquieting. The passage of time, by itself, can be a bad reason for breaking past commitments if it’s merely the result of forgetting. But time also offers legitimate grounds for rejecting earlier commitments. Experience reshapes people’s preferences, and sometimes that shift is warranted. Sometimes it’s democratically ratified.

It may be that a concern with technocratic efficiency has given way to an appetite for something we might describe as the Romantic impulse. And it may be that the technocrats have themselves to blame. They had their chance, and they messed up. Theirs was a particular definition of reason, which largely comes from economic theory: A preoccupation with “growing the economic pie” but a lesser one with who gets what slice. A focus on consumption rather than production, which views production as merely the tedious thing we have to go through in order to consume what one wants to consume. With such a view, it’s difficult to understand that individuals may value production for its own sake.

Whatever the cause, there are signs that what we are seeing is a real shift in preferences. The costs of American recklessness have been lower than many anticipated, but they remain real: the U.S. dollar has dropped, prices have risen, the cost of debt has increased. And it so happens that these costs have been especially high for supporters of Donald Trump. In this respect, what I find most striking is the apparent willingness of that electoral base to absorb the costs.

We know that the electoral base behind the current U.S. administration has been disproportionately affected by the tariffs, both because they consume more imports and because local industries rely on them to a greater degree. We also know that the base is disproportionately targeted by retaliatory tariffs: Brussels and Beijing both know where Trump voters live. But, so far at least, those facts have had little effect on political loyalties. Farmers who were most directly affected by the tariffs in Trump’s first term, for instance, voted for him in record numbers in 2024.

Political entrepreneurs are recognized by their ability to reshape people’s aspirations. That’s what this wave of populist leaders is doing. They are not just offering some seductive policies. They’re changing the underlying preferences: elevating sovereignty over efficiency, belonging over mobility, protection over openness. Many citizens, in the U.S. and elsewhere, seem to increasingly identify with a self that does not stand for reason as previously understood — and that should give us pause.

Which brings us back to my initial question: How do the shipmates know which Ulysses to trust? I’ve asked hundreds of people that question — economists, political scientists, philosophers, and classicists, not to mention about fifteen cohorts of smart graduate students.

Their answers vary, but they can be sorted into roughly two camps. The first camp holds that the shipmates know that untying Ulysses would mean crashing against the rocks, and so they choose life over death. That sounds plausible but also incomplete. The issue I see is that this requires the shipmates to disobey orders. They are not choosing between the first and second Ulysses so much as deciding for themselves based on what they know. Which is asking a lot of these men, especially since we know that they have blindly trusted Ulysses in the past (and will go on trusting him, in some cases — spoiler alert — at the cost of their lives).

The second camp argues that the shipmates are drawing conclusions from the asymmetry between the two selves. The first Ulysses is able to evaluate both the cool moment of planning and the hot moment of temptation — while the second Ulysses is stuck in his own blinkered state of mind. It’s difficult to imagine the second Ulysses yelling, “And next time I tell you to tie me down, believe me not at all!” That would require a presence of rationality, an ability to step outside of the self. In other words, the very ability to make plans to bind the other suggests a kind of awareness, a capacity to inhabit the other self, which should lead us to endorse that self.

Now let me offer a similar set‑up, where time plays a bigger role. My graduating students often have similar career plans: they tell me they will accept a lucrative job for five years, enough time to pay off their student debts, and then, they say, they’ll quit and do what they actually want to do with their lives. They’ll devote themselves to documentary filmmaking, for instance. What invariably happens, after five years, is that their initial decision to pursue their “true calling” no longer exerts the same pull it once did. The criteria by which they evaluate the meaning of the good life have changed. They now want to partner at the firm.

Seeing this, should I, as a mentor, enforce the earlier self’s promise? “You made a plan, now quit being a banker and go and make a documentary film”? I’m not so sure. What I do tell them is, “Look, people who make this type of commitment often find that their preferences change — the same may happen to you.” In doing so, I believe I’ve discharged myself of my mentoring obligations.

The question is, What should they do with that information? Should they somehow bind themselves in a credible way, or should they allow for their preferences to change? Should they allow themselves to become someone they’re not? My tribe of political economists tends to be biased toward the first Ulysses. We’re quite moralistic in this respect. We take for granted that reason ought to dominate passion. Yet we have to reckon with the fact that sometimes the second Ulysses may have the stronger claim, for reasons both good and not so good.

The episode of the Sirens has shaped my thinking for two decades, and I’ve come to doubt that passion and reason can be cleanly separated. We need to keep asking how the shipmates know which Ulysses to trust, because the answer is not obvious. That’s because those rare constitutional moments rarely arise from dispassion; it takes a type of passion to summon the will to self-bind. Which isn’t to say that we should wish for trauma, for the weekend bender, or for the overdose. But we should remember that reason rarely moves us by reason alone.

It also turns out that, as opposed to that convenient asymmetry between the first and second Ulysses, a passionate self can in fact take up the tools of politics against the other. Last spring, for example, the dairy industry in Quebec succeeded in getting the Canadian Parliament to pass legislation binding Ottawa against self-binding: the law makes it illegal to reduce barriers on dairy as a concession in any trade negotiations. This is as if the Sirens had swum over and stolen all the rope from the ship.

Finally, we must recognize that circumstances change, and so do people. And if there are legitimate reasons for going back on our commitments, it also necessarily opens the door to illegitimate reasons. Then we need some means of deciding which is which.

If we want institutions that last, we must recognize the continued pull of the passions. That requires an exercise of sympathy — in the old Scottish Enlightenment sense of the word: as the ability to imagine, to inhabit the mind of the other self, the other citizen. Sympathy is how we keep the first Ulysses alive in political systems where the song of the Sirens is always being heard.

So the task is not to engineer passion out of politics as if it were some pathology. The task is to harness those passions on behalf of better reasons — through a study of history, through innovative rules that account for the pulls of politics, possibly through novel rituals to make and to renew our commitments. If we side with the first Ulysses — if we side with reason — we must be willing to fight for it, passionately.