Auerbach holds Modernism to be the solution for unity, for solving the problems of difference. He links the advent of Modernism with the important historical changes that happened from the end of the C18th to the beginning of the C19th.
Yet I think that an important implication here is that it suggests that the movement is a result of historical forces, not allowing for a more complex cause-and-effect relationship between the two.
This has significance in our consideration of imperialism, because when he mentions that ‘the crowding of mankind on a shrinking globe sharpened awareness of the differences in ways of life…’ (p.550), it fails to acknowledge the extent to which Modernism in art and literature (and elsewhere) might have contributed to and aided imperialism and colonisation, mostly importantly it the representation of ‘natives’.
Modernism grew out of Romanticism and Realism; it is thus influenced by these 2 modes and their tendency to allow exoticisation and claims to absolute truth (of the imperial powers, of course).
Auerbach’s claim that ‘The strata of societies and their different ways of life have become inextricably mingled. There are no longer even exotic peoples.’ (p.552) becomes a little disturbing — his praise of Modernism in this piece actually re-enacts imperial Western claims, along the lines of how ‘the whole world is discovered (itself a loaded word)’, ‘everyone is equal’ (equal for whom? Males? Whites? Europeans? Jews? Muslims?). In fact, now that I think of it, it sounds downright neo-colonialist as well!