From Can Democracy Survive Global Capitalism? Robert Kuttner. 2018. Kindle online sample. Section 3.
During the period between the two world wars, free-market liberals governing Britain, France, and the US tried to restore the pre–World War I laissez-faire system.
They put debt collection ahead of economic recovery.
It WAS AN ERA OF RAMPANT SPECULATION AND NO CONTROLS ON PRIVATE CAPITAL.
All this was supposed to promote prosperity and peace.
Instead, it produced a decade of economic insecurity combined with heights of inequality, a discrediting of democracy, fascist backlash, and deeper depression.
…
The great prophet of how market forces taken to an extreme destroy both democracy and a functioning economy was less Karl Marx than Karl Polanyi.
As Polanyi demonstrated in his 1944 masterwork, The Great Transformation, the DISEMBEDDING OF MARKETS FROM THEIR SOCIETIES AND RESULTING INATTENTION TO SOCIAL CONSEQUENCES INEVITABLY TRIGGERS A REACTION.
The reaction is more often chaotic and fascistic than politely democratic.
Polanyi saw the catastrophe of World War I, the interwar period, the Great Depression, fascism, and World War II as the logical culmination of market forces overwhelming society.
…
Rereading Polanyi at a time when events vindicate his vision, one is struck by the eerie present-day ring.
Polanyi, like his great contemporary John Maynard Keynes, the architect of Bretton Woods, was an optimist.
WITH THE RIGHT POLITICS AND THE RIGHT MOBILIZATION OF DEMOCRACY, BOTH POLANYI AND KEYNES BELIEVED MARKETS COULD BE HARNESSED FOR THE COMMON GOOD.
They recognized the propensity of capitalism to create calamity but did not believe that outcome to be inevitable.
…
The great pessimist, of course, was Marx.
In the mid-twentieth century, history failed to follow Marx’s script.
At the apex of the postwar boom in the United States and Europe, Marx’s bleak prediction of capitalist self-destruction seemed ludicrous.
A contented bourgeoisie was huge and growing.
THE PROLETARIAT ENJOYED STEADY INCOME GAINS, THANKS TO STRONG TRADE UNIONS AND PUBLIC REGULATION.
…
The political energy of aroused workers Marx imagined as revolutionary instead went to support social democratic and progressive parliamentary parties.
These built a welfare state, to temper but not supplant capitalism.
NATIONS THAT CELEBRATED MARX WERE BLEAK ECONOMIC FAILURES THAT REPRESSED THEIR OWN WORKING CLASSES.
…
Now, half a century later, working people are beleaguered and insecure.
A global reserve army of the unemployed batters down wages and marginalizes labor’s political power.
Increasing amounts of homeless vagrants and stateless migrants rends the social fabric.
THE GLOBALIZED MARKET WEAKENS THE REACH OF THE DEMOCRATIC POLITY, undermining the protections of the mixed economy.
…
Ideologically, the neoliberal view that markets are good and states are bad is close to hegemonic, a collection of far-fetched, unquestioned, self-serving ideas.
With finance still supreme despite the disgrace of the 2008 collapse, it is no longer risible to use “capital,” Marx-style, as a collective noun.
GOLDMAN SACHS ALUMS PROVIDED FIVE OF THE LAST SIX US SECRETARIES OF THE TREASURY, Democrats as well as Republicans.
…
I still believe, with Polanyi and Keynes, economies can be democratically harnessed for the general good.
However, TO ACHIEVE A DEMOCRATICALLY CONSTRAINED MIXED ECONOMY, ALMOST EVERYTHING HAS TO BREAK RIGHT.
Success requires fortuitous historical circumstances, movements that mobilize citizens against elites, inspired democratic leaders, and a good dose of luck. These moments tend not to last.
The institutions often turn out to be more fragile than they first appear, and they require continual renewal.
…
In a basically capitalist economy, financial elites, even when constrained, retain an immense amount of residual power.
That FINANCIAL POWER CAN BE CONTAINED ONLY BY COUNTERVAILING DEMOCRATIC POWER.
The Bretton Woods era suggests a more benign form of globalization is possible.
But the postwar brand of globalization, balancing citizenship and market, above all required a politics.
…
Today, a few thinkers could sit in a seminar room and design a better and stronger globalization and democratic polity.
Keynes and his generation did just that after World War II.
But they had the political winds at their backs.
Today’s architects of democratic capitalism face political headwinds.
Though ideas do matter, they are no substitute for political movements.
CAN WE RECLAIM A DECENT ECONOMY THAT WORKS FOR MOST PEOPLE, AND IN TURN RESTORE DEMOCRACY?
Perhaps, but once again, it will take leadership, power, and luck.
(end of section 3)
… …
(own comments)
Section 1:
“Autocrats are using the forms of democracy to destroy the substance.”
Am certain the author’s solution to his perceived causes of problems is to expand U.S. federal government power and control over the successful rich and All us who might also become successful, rich, and independent.
Oll this Dem’s mish-mash is actually an obfuscation of, distraction from, and reaction against the success of U.S. and worldwide growing capitalism and democracy, against dreaded widespread increased riches and happy.
The soon-attain end goal must be the world as one big U.S.A., a U.S. of the World with:
-free trade and movement of assets including people
-more capitalism and less government
-one currency
-one first language
All this with an added guaranteed basic income, a Citizens’ Shareholder Dividend (CSD).
The more artists and philosophers the better.
Not only those with luck should have the big bucks.
Start now with $100 per person and expand only as the federal government shrinks, resulting in both U.S. economy and CSD exponential growth.
Tomorrow’s mere millionaires will be the “poor” felt sorry for by oll the awful but helpful omrondle Dems and socialists.
Zei as-always will forever want to stop All those who be most active and productive, with dems’ actual goal of bringing down everyone to be equally poor and miserable and under total monopoly feudal federal governmental control.
The biggest and best expense of the CSD will be the lost political power and control among dem on-top down-looking kingly and queenly shapeless-form politicians here and everywhere.
The U.S. is the solution not the problem.
But first the American model must be improved so it will be attractive to join.
The first step is to control then reduce the power of the federal government returning power to the states, the Real Republican goal.
Countries will not want to join the U.S. if their country will be absorbed into a total U.S. federal government-dependency monopoly misery.
… …
Section 2:
“When the system is in balance, strong democracy tempers market forces.”
The theme of this book seems to be to strengthen democracy we need more government control and less capitalism freedom.
…
“With globalization elites have won the policy debates but have lost the citizenry.”
This author lists many problems and has many questions but no answers except voting in Democrats and voting out Republicans.
Building a thick and strong wall around the U.S. is not the answer.
Globalization is the answer and will continue, the question be how best to proceed.
Freer markets have the same effects as advancing technology:
-more, better, and less expensive products produced
-some current jobs are eliminated but many more future jobs are created
However, politicians know only current voters can vote for them.
We in Indiana don’t care if we have a trade deficit with Illinois and we in the U.S. shouldn’t care if we have a trade deficit with Japan.
How best to proceed? – Very quickly.
We must start with the U.S. dropping all restrictions on imports from other countries including China, just as there are no restrictions between Indiana and Illinois.
· we in the U.S. will instantly double personal wealth and incomes, the slope in Figure 1 will become even steeper
· all other countries will be forced to soon follow
· shapeless-form monopolist gangster leaders in China, Russia, North Korea, and everywhere will be done and gone
Need peoples’ simplicity of game-changing Rubric Cube not elites’ complicity of game-playing Rubik’s Cube.
“When the system is in balance, strong democracy tempers market forces.”
In other words, to strengthen democracy we need more government and less capitalism.
… …
Section 3:
“Disembedding of markets from their societies and resulting inattention to social consequences inevitably triggers a reaction.”
Always the problem is not the free market but rather the reactions to, exacerbated by power-desiring politicians, to the short-term disruptions and hardships that can occur as the free market advances.
…
“With the right politics and the right mobilization of democracy, both men believed markets could be harnessed for the common good.”
Recently Democrats and socialists have conflated the two words “democracy” and “government.”
For Democrats and socialists:
“Democracy” = “government.”
“Democratically” = “governmentally.”
“Democratic” = “governmental.”
“Can Democracy Survive Global Capitalism?” = “Can Government Survive Global Capitalism?”
…
“That financial power can be contained only by countervailing democratic power.”
Simply, when in doubt:
Focusing on short-run contained small gain, Democrats want more government power.
Focusing on long-run uncontained big gain, Republicans want less government power.
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