Beyond Washington consensus: How the 21st century is driven by technology and geopolitics, not ideology

For much of the late twentieth century, global economic thinking was animated by a quiet but powerful confidence that broadly applicable models could guide the development of nations. Whether expressed through ideological systems such as socialism and capitalism or through policy frameworks such as the Washington Consensus, the assumption was that generalisable principles could organise economic life across diverse societies. Development was widely understood as a process of convergence. Countries might adapt these frameworks to their own circumstances, but over time they were expected to move toward a shared architecture of markets, institutions and prosperity.

Today, that confidence has largely faded. The world that once produced influential templates for development now appears far more fragmented. Economic prescriptions that were once presented as universally applicable increasingly appear contingent on local political economies, institutional capacities and historical trajectories. The decline in the authority of such frameworks does not mean that market liberalisation, fiscal discipline or global integration were misguided. Rather, it reflects growing scepticism towards the idea that a single policy architecture can reliably guide economic transformation across vastly different societies. In this sense, the fading authority of the Washington Consensus marks more than the decline of one economic doctrine.

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It reflects the emergence of a more pragmatic, post-ideological policy landscape. In practice, governments rarely operate within pure doctrinal frameworks. States historically associated with market liberalism have rediscovered industrial policy, strategic subsidies and selective trade restrictions to secure technological leadership and economic resilience. At the same time, economies long shaped by strong state direction have expanded market incentives and integrated more deeply into global trade.

The ideological binaries that once structured debates about development—state versus market, protection versus openness—are increasingly giving way to hybrid arrangements combining markets, state coordination, welfare provision and regulatory intervention in different proportions. What is emerging is less an ideological settlement than a pragmatic eclecticism. Policymakers are drawing selectively from multiple intellectual traditions, assembling policy toolkits that respond to domestic political pressures, demographic realities and technological change. Context is increasingly shaping the architecture of economic governance.

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However, the erosion of universal economic frameworks is only one dimension of a deeper transformation unfolding in world politics. The weakening of ideological templates has coincided with the re-emergence of geopolitical rivalry as a central organising force in the international system. In the decades following the Cold War, economic integration appeared to promise a world in which interdependence might soften strategic competition. Expanding supply chains, technological collaboration and deepening trade ties reinforced the belief that globalisation could produce a more cooperative international order.

That expectation has proved only partially durable. Strategic rivalry among major powers is now reshaping the structure of globalisation itself. Economic policy is increasingly evaluated not merely through the lens of efficiency but through concerns about resilience, security and technological sovereignty. Questions that once seemed largely technical—where critical industries should be located, how supply chains should be organised and who controls foundational technologies—have moved to the centre of national strategy. Infrastructure that once appeared primarily economic now carries unmistakable geopolitical significance. Semiconductor manufacturing shapes technological competitiveness. Submarine cables underpin global internet connectivity. Satellite systems support navigation, communication and financial networks. Energy corridors and digital platforms structure the movement of resources and information across borders.

Control over these systems confers strategic leverage. As geopolitical competition intensifies, governments are seeking to reduce dependence on networks that could become vulnerabilities in times of crisis. Supply chains are being reconfigured, technological ecosystems segmented and industrial policies redesigned to secure domestic capabilities.

Technological change is accelerating this transformation. Many of the most consequential technologies of the modern era—from the internet to satellite navigation—emerged from military research before diffusing into civilian life. What distinguishes the present moment is the rapid convergence between commercial innovation and strategic capability. Artificial intelligence, advanced semiconductors, quantum technologies and space systems are increasingly viewed not merely as engines of economic growth but as instruments of geopolitical power.

This convergence, however, introduces new systemic risks. Technologies that underpin critical infrastructure like financial systems, communication networks, navigation platforms and energy grids, etc, are evolving faster than the governance frameworks meant to regulate them. At the same time, geopolitical fragmentation makes agreement on common rules increasingly difficult.

A paradox therefore emerges. As the weakening of universal policy frameworks grants states greater flexibility to pursue context-specific strategies, the absence of broadly accepted norms governing emerging technologies and strategic infrastructure increases the risk of instability. The twentieth century was defined by ideological struggles over how societies should organise economic and political life. The twenty-first may instead be defined by the challenge of managing technological power within a fragmented geopolitical order. If universal economic models no longer determine the trajectory of nations, global stability will depend less on ideological convergence than on the gradual construction of norms, restraint and institutional cooperation capable of governing an increasingly contested technological landscape.

The Washington Consensus once promised a universal roadmap to prosperity. The task before the world today is less about designing the next grand doctrine than about building guardrails for a system in which economic policy, technological innovation and geopolitical competition have become inseparable. In a world where ideology no longer provides a single compass, stability will depend on how wisely nations manage the immense technological power now at their disposal.

(The writer is the co-author of ‘The Last Battle of Saraighat: The Story of the BJP’s Rise in the North-East’. She teaches psephology and communication at the School of Global Leadership. Views expressed are personal and solely those of the author. They do not necessarily reflect Firstpost’s views.)