Capitalism is in crisis. What Marx referred to as its internal contradictions have begun undermining its very foundations. It is time to ask what a post-capitalist world will be like.
It is perhaps unsurprising that two of the most brilliant analysts of our economic times come from democratic socialist backgrounds in Europe. In Europe there has always been a deep distrust of the Anglo-American obsession with neoliberalism’s ideological repudiation of community and society in the development of a healthy economy. Dismissed by neoliberal advocates as the nostalgia of “old Europe”, new forms of democratic socialist analyses of local, regional and global economies are increasingly coming into focus as neoliberalism’s failures stack up unrelentingly. These failures are largely unseen or avoided by economists in the United States and their camp followers in the UK and Australia who have nearly all been educated in an era of neoliberalism. They are in denial of the fact that not only has neoliberalism failed to meet any of its claimed goals, but it has worked assiduously and devastatingly to undermine the very foundations of late modern capitalism. The whole shambolic structure is tottering on the edge of an abyss.
The two Europeans are the Frenchman Thomas Picketty (Capital in the Twenty-First Century) and the German Wolfgang Streeck (How Will Capitalism End?). Picketty’s book has shown how socio-economic inequality is fundamentally destructive of sustained economic growth. Nonetheless, Western (capitalist) economies continue merrily down the road to nowhere constructed by the economic policies of Margaret Thatcher and Ronald Regan (and slavishly followed by Australian politicians on all sides ever since).
Picketty has warned in no uncertain terms that neoliberal economies are creating the most egregious socio-economic inequalities in history. Adding grist to his mill is the recent Oxfam report showing that a mere eight multi-billionaires now own more capital that half of the global population.
Wolfgang Streeck’s latest book is reminiscent of Max Weber’s bleak predictions about the inevitability of a soulless, dehumanizing capitalism locking up our very humanity in an “iron cage of rationality.” Streeck’s analysis of the end-days of capitalism suggests that history is indeed ending, but not because (as Fukuyama predicted) liberal capitalism had triumphed over all its opponents (especially communism), but because it has eaten up its critics and opponents, thereby obviating all possible alternatives to its predatory ways. (Witness how the ALP is today as grotesquely neoliberal as the Liberals – they truly are tweedledee and tweedledum.)
If Streeck is correct (and he has a long and impressive history of economic scholarship to back up his sober and very sobering analysis), then we need to anticipate what a post-capitalist world may look like.
Streeck thinks it is going to be horrible. It will be largely a neo-corporatist development entailing close collaboration between big capital, union leaders, government and the military. (Think fascism in Germany and Spain from the 1920s to the end of World War II.) Presumably in this hideous scenario, Muslims will be the new Jews and concentration camps and the whole evil paraphernalia of the repressive state will be constructed to create a ruthless form of post-capitalism. Jobs will disappear. Capital will be intensely concentrated in very few hands. In retreat from globalization, the privileged rich will withdraw into security enclaves dripping with every luxury imaginable. (Think of the gargantuan bad taste of Donald Trump’s New York penthouse.) Meanwhile the masses will be caste adrift in a polluted and miserable world where life (as Hobbes put it) will be nasty, brutish and short.
This prognosis about our post-capitalist world is part of what Enzo Traverso has called “left-wing melancholia,” pointing to the failure of the critics of neoliberalism to come up with real alternatives to the kinds of horror scenario drawn so compellingly for us by Wolfgang Streeck.
The problem is that this “melancholia” is a form of collaboration with the neoliberal agenda. It represents a massive failure of imagination by democratic socialists to come up with hard-hitting and well-documented critiques of neoliberalism while providing programs for transcending the appalling possibilities that a post-capitalist world may entail.
The time is ripe for some creative imagining of a new post-capitalist world that frees us all from Weber’s iron cage, that will repair neoliberalism’s vast and catastrophic failures, and that will lay the groundwork for cosmopolitan and cooperative world. It’s time for an end to melancholia that in reality is a form of mental laziness and ridiculous self-pity.
Three immediate steps can be taken to start on this great journey.
First, democratic socialists need to work out how to join with the forces of what the American international law professor Richard Falk called “globalization from below.” This alludes to the strengthening of international movements discussed in John Keane’s excellent book, International Civil Society?
Second, they need to come up with a new account of democratic governance – one that rids us of the fiction that the current politics of representative government are the highest possible form of democracy. There is nothing about representative government that is democratic. All it amounts to is what Pareto described as “the circulation of elites.” Today those elites have become ever more remote from – and haughtily contemptuous of – the people they rule.
Third, we need to see states becoming deeply engaged with the so-called “free market.” Apart from re-regulating economic activity, this means positioning public enterprises in strategic parts of the economy, to compete with the private sector, not on their terms but exclusively in the interests of all citizens.
The post-neoliberal era is already beginning. Either a grimly post-capitalist, neo-fascist world awaits us, or one shaped by a new and highly creative democratic socialism. It’s time for some great imagining.
Dr Allan Patience is a political scientist in the University of Melbourne.