Very little of this could have been perceived in the years 1860 to 1914. Historians tend to see the germs of what will happen in what has already happened and write about the past in the light of the consequences. One must try to resist the temptation. In 1910 hardly anyone seriously foresaw (though a few guessed) the First World War and the Russian Revolution. In the aftermath of the war not many foresaw the rise of Fascism and Nazism, the crash of 1929, the Japanese invasion of China in 1931, and the Second World War. In 1940 only a few perceived how the Cold War would shape the world or the end of colonial empires. In the 1970s and 1980s few predicted the fall of communism, the rise of China as a major economic power, and the advent of Islamic fundamentalism after the Iranian Revolution of 1979. Perhaps one should bear in mind Tocqueville’s warning that ‘Nothing is more apt to remind philosophers and statesmen of the need for modesty than the history of the French Revolution, for no event was greater or longer in the making or more fully prepared yet so little anticipated.’18
What was perfectly predictable and indeed widely predicted in the decades preceding the Great War was the triumph of capitalism, since even (or especially) its main opponents, the socialists, assumed that capitalist development was a ‘natural’ and inevitable stage in world history. Yet outright pro-capitalism was never a vote winner. If we examine the ideological basis of mass parties in the hundred years between 1880 and 1980, it is rare to find considerable popular support for what we might call today neo-liberal positions. There were social-democratic, socialist, and communist parties in most of Europe, New Zealand, and Australia; there were various social Christian parties: in Italy the Partito Popolare and, in 1943, its successor, the Democrazia Cristiana; in Germany, the Zentrum and, after 1945, the Christlich Demokratische Union and its Bavarian sister party, the Christlich-Soziale Union; in Austria the Christlichsoziale Partei and its successor the Austrian People’s Party (Österreichische Volkspartei). There were in the Scandinavian countries various agrarian parties; in Greece and in some Latin American countries personality-based parties; and in the United States, Argentina, and Peru populist parties. There were ‘national’ or ‘one-nation’ parties such as the Gaullists in France, the Republicans and the Democrats (divided by policies such as ‘states rights’ versus ‘big government’) in the USA, the Conservatives in Britain, and, elsewhere, fascist parties of various hues.
Although capitalism was the only game in town, the electorate would not countenance a clear and direct appeal to free markets, and free-market liberals were in a minority throughout democratic Europe. A more positive view of the market economy emerged in the decades after 1945 and far more markedly only after the 1980s, when the second great globalization was under way. By then politics had changed considerably. What we called the ‘reactionaries’ (see the Introduction) have virtually disappeared. Only a few lovable eccentrics and some well-off ‘hippies’, almost all in prosperous countries, really harbour the dream of returning to the simplicities of pre-capitalism (when life chances were a fraction of what they are today).
The social Christians have almost gone. Christian Democracy, which in its German, Italian, and Austrian variants had presented itself as a barrier against both untrammelled individualism and mindless collectivism, has ended up being no more than compassionate conservatism. Outside Europe the main stronghold of political Christianity lies in the growing power of the fundamentalist Churches in the United States, where Jesus is recast as an unlikely supporter of free-market forces. While nineteenth-century evangelicals were concerned with social ills, such as alcoholism, slavery, or poverty, their modern followers are in love with capitalism. The Jesus who drove out ‘all those who bought and sold’ (the merchants) from the Temple (an episode that occurs in all four Gospels), and who would today threaten to do the same to bankers, would be lynched as a communist by some of today’s fundamentalists.
Social democrats have not disappeared, but they are a shadow of their former selves. They find themselves compelled to defend the gains of the past (such as the welfare state) with no vision for the future, apart from spreading the benefits of capitalism more widely and more equally. A cautious conservative outlook has become their most obvious trait.
The trade unions are weaker than ever. The usual measure of union strength is the percentage of union members in the workforce (trade union density), an indicator that must be treated with caution since some countries with comparatively low density, such as France (only 7.7 per cent in 2014), have strong collective bargaining, and some of the former communist countries, such as the Czech Republic, with high union membership (for historical reason), have weak unions.19 With this caveat in mind, it is significant that union density has been steadily declining throughout the OECD countries: in 1999 the average was 21 per cent and by 2014 it was down to under 17 per cent. In 1980, as a wave of neo-liberalism was about to be unleashed, trade union density in Germany was 34.8 per cent, in 1999 it was down to 25.3 per cent, and 18.4 per cent in 2011. In Italy density decreased from 49.5 per cent in 1980 to 35 per cent in 2011. In Israel, where the trade union federation (the Histadrut) was particularly powerful, union density dropped by half between 1999 and 2011. In Sweden, home of what is still the strongest trade union movement in the world, union density steadily declined from its peak of 86 per cent in 1995 to 67.7 per cent in 2014 (OECD data; the figures, however, include retired union members).
In the United Kingdom the drop was from 49.7 per cent in 1980 to 25.8 per cent in 2011. Legislation promulgated by Margaret Thatcher and her successor John Major further weakened the trade unions and reduced employment protection.20 Much of this anti-union legislation was not repealed by successive Labour governments, though it was somewhat tempered by EU directives unenthusiastically implemented by Labour.21 In the industrial relations field, as Colin Crouch, writing in 2001, has ‘tentatively’ suggested, ‘New Labour represents a continuation of the neo-liberalism of the Conservative government.’22
Nevertheless the idea of untrammelled capitalism has remained unpopular in the United Kingdom, so much so that its main upholder, the Conservative Party, is embarrassed by it and in its manifesto for the election of 2017 declared that:
Conservatism is not and never has been the philosophy described by caricaturists. We do not believe in untrammelled free markets. We reject the cult of selfish individualism. We abhor social division, injustice, unfairness and inequality.23
Much of this general decline was due to the significant shift away from manufacturing in the traditional industrial countries of the West, the drop in public-sector employment, and the proliferation of part-time and casual work and self-employment. In general, union membership has been more solid in the state sector than in the private sector; for instance, in Sweden union density is 83 per cent in the state sector and 65 per cent in the private sector.24
Free-market ideology has made inroads in countries that had originally appeared inured to it. Israel has ditched the ethnic-based Zionist socialism of its founding fathers (though it was never much more than a useful myth) in favour of an equally ethnic-based unbridled capitalism tempered by massive subsidies to West Bank settlers and immigrants (as long as they are Jewish).25 In India the original socialistic inspiration of the Nehru-Gandhi Congress Party has metamorphosed into a market-oriented India led by the Hindu nationalist Bharatiya Janata Party (BJP, the Indian People’s Party). Gandhism achieved few of its desired aims such as truth (satya), progress for all (sarvodaya), simple living, and national economic self-reliance (swadeshi). India today is as corrupt and violent as many other societies that never benefited from Gandhi’s teachings. The BJP, as of 2016 India’s largest political party, has long abandoned its commitment to ‘integral humanism’, which rejected individualism, in favour of an unabashed neo-liberalism under the banner of ‘resurgent India’. In Turkey the secular authoritarian model imported by Mustafa Kemal Atatürk from Europe has given way to a popular authoritarianism committed to Islamic principles developed by Recep Tayyip
Erdoğan, who, like Indian’s Narendra Modi, the BJP leader, links neo-liberalism with religious values.
In the United States, President Bill Clinton, in his 1996 State of the Union address, declared that ‘The era of big Government is over’ while conceding that ‘we cannot go back to the time when our citizens were left to fend for themselves’.26 And Gordon Brown, when Labour Chancellor of the Exchequer in the United Kingdom, in 2006, a year before the beginning of the global downturn, congratulated the City of London for its achievements and for showing ‘that Britain can succeed in an open global economy, a progressive globalisation, a Britain that is made for globalisation and a globalisation that is made for Britain’.27
In Japan large companies run along paternalistic lines guaranteeing lifetime employment (shūshin koyō) to their grateful employees and a wage system that rewarded seniority and loyalty to the company (nenkōjoretsu) are under constant attack by the companies themselves. The old system, extant in some form since 1910, was credited for Japan’s ‘economic miracle’. Now that the miracle is over and the Japanese economy is stagnant, a new paradigm, in tune with neo-liberal beliefs, is emerging. ‘Lifetime employment’, glorified as the secret of success some decades ago, has turned into the alleged cause of stagnation.
Various ‘socialist’ variants, popular in the years of decolonization (‘African socialism’, ‘Arab socialism’, etc.), disappeared long ago, degenerating into generically pro-market dictatorial kleptocracies (such as those of Syria, Tunisia, Egypt, Algeria, and Zimbabwe). The Arab Spring of 2011 has ended up, in most cases, in bloodbaths, and, in the case of Syria, far worse than its main historical antecedent, the Print-emps des Peuples (the Revolutions of 1848). The liberation of South Africa from the clutches of the apartheid regime in the years 1991 to 1994, the enfranchisement of the black majority, and the electoral victories of the African National Congress (ANC) in alliance with the South African Communist Party, have produced decidedly pro-business governments. As a result, in 2013, the largest trade union, the National Union of Metalworkers of South Africa (NUMSA), with well over 320,000 members, withdrew its support from the ANC.
Leftist hopes in Latin America, after the disappointments of its Cuban (communist) and Chilean (social-democratic) variants, were revived with Hugo Chávez in Venezuela (1999–2013), Luiz Inácio Lula da Silva (Lula) in Brazil (2003–11), the second wave of Peronism with Néstor and Cristina Kirchner in Argentina (2003–15), Evo Morales in Bolivia (2006–), and Rafael Correa in Ecuador (2007–17). Their advance was, at least in part, due to the fact that the expansion of the neo-liberal free market in the years 1980 to 2000 had not produced economic growth comparable to that of the much-reviled era of ‘import substitution’ (1960–80), except in the case of Chile.28
However, gradually, and in different forms, the hopes of a new Latin American anti-capitalism have been dashed: Nicolás Maduro, Chávez’s successor, is ruling a country whose economy is in ruins. In Nicaragua the highly repressive regime of Daniel Ortega, once the darling of the left for having led the so-called Sandinista Revolution (1979–90), has turned out to be responsible for a repression of major proportions.29 In Brazil, Lula was involved in financial scandals and his successor, Dilma Rousseff, was impeached for breaking Brazil’s budget laws and had to give way to Michel Temer, widely held to be corrupt. He was succeeded by Jair Bolsonaro, nostalgic for the good old days of the dictatorship, self-confessed homophobe, misogynist, defender of torture, and racist. In Argentina, Cristina Kirchner was succeeded by a conservative, Mauricio Macri. Matters went better for the left in Bolivia when Evo Morales was re-elected for the third time in 2014; but in Ecuador, Lenin Moreno, once a loyal follower of Rafael Correa, turned to the right after winning the 2017 presidential elections. In Mexico, after prolonged drug wars that have cost the lives of 230,000 people (13,000 in 2011 alone), the anti-corruption candidate Andrés Manuel López Obrador was elected president in 2018. He faces an uphill task.30
Of course, nothing, in life or politics, ever proceeds smoothly. There is resistance to neo-liberalism, particularly neo-liberalism in international trade. Since free trade is a complex issue embraced historically by an array of political forces from left to right, the kind of trade liberalization promulgated by the IMF and the World Trade Organization, and embodied in free-trade treaties such as the North American Free Trade Agreement, the Trans-Pacific Trade Agreement, and the proposed Transatlantic Trade and Investment Partnership, encounter the hostility of populist movements of both the right and the left. The hostility of the ‘anti-global’ activists (who are themselves globalized, since they try to act on a worldwide scale and communicate using all the facilities of the international communication system) is far from being unjustified: in the 1980s (when Thatcher and Reagan ruled) the IMF and the World Bank became, as Joseph Stiglitz explained, ‘the new missionary institutions’ of free-market ideology and pushed these ideas ‘on the reluctant poor countries that often badly needed their loans and grants’.31 Yet the issues are never straightforward: as Joseph Stiglitz himself points out: ‘Opening up the Jamaican milk market to U.S. imports in 1992 may have hurt local dairy farmers but it also meant poor children could get milk more cheaply.’32
Capitalism has coexisted with a variety of regimes, from Victorian Britain to republican France and Switzerland, from Fascism and Nazism to post-war European democracies, from post-Meiji Japan to south-east Asian dictatorships and communist China. It is difficult to imagine that, in the future, it would not be able, at the global level, to absorb and/or co-opt xenophobes, leftists, populists, and assorted anti-globalizers. After all, in order to survive, all that is required is for stuff to be made and sold to someone, somewhere. The ease with which Syriza, the Greek Coalition of the Radical Left, elected to power in 2015 on an anti-austerity platform, was compelled to accept the conditions imposed by the European Union is evidence of the severe external constraints that all elected governments face. No one wants to be permanently in opposition, but it is often easier than governing.
Anti-austerity movements, such as the Indignados in Spain or the Kínima Aganaktisménon-Politón in Greece, which surfaced in the years after 2010, as well as the ‘no-global’ left do not really propose an alternative to capitalism; only a more just capitalism. Unlike past socialist movements, it has little connection to ‘the working class’; it is the champion of the poor, the marginalized, the victims of global capitalism, though it claims to be on the side of the 99 per cent against the top one per cent. Yet it has failed to mobilize most of the 99 per cent. The poor in Third World countries want to work for Western enterprises, since the alternative is to be poorer. A modern defence of these enterprises, such as that offered by the Nobel Prize winner Paul Krugman, would point out that the children offered ‘exploitation’ wages in sweatshops in the Third World would earn even less and work harder in poorer conditions on a plot of land or scavenging on a garbage heap.33
The wave of austerity policies of the twenty-first century that has paralleled the growth in inequalities has given rise to a crisis of ‘normal’ politics, as one might call the alternation in power between centre-left and centre-right parties. Parties that seemed to be solidly implanted in the Western political systems have disappeared or changed radically. In Italy virtually all the parties that dominated the politics of the country until 1990 (Christian Democrats, Communist, Socialist, etc.) gave way to a party led by a television tycoon (Silvio Berlusconi’s Forza Italia), a centre-left party made up of ex-communists and Catholics (Partito democratico), a xenophobic party (Lega Nord, now called simply Lega), and a party founded by a comedian (Beppe Grillo’s Movimento Cinque Stelle). In Austria the two candidates in the run-off for the presidency in 2016 did not belong to either of the two parties (Socialist and Social Christians) that had dominated the country almost uninterruptedly since the war: one was a Green, the other a right-wing populist (the Green won, just). In France, Emmanuel Macron, never before having held elected office, became President in 2017 by def
eating the far-right candidate Marine Le Pen, while the traditional parties of the Fifth Republic, Socialists and Gaullists, were virtually annihilated. In the United States, Donald Trump, the Republican candidate whose politics were deemed ‘peculiar’ by most of the elites, won against the establishment figure of Hillary Clinton (though with a fewer votes). In the United Kingdom the referendum on membership of the European Union was won by those who wanted to leave, even though the majority of all the main parties wanted to remain, as did the City of London, the trade unions, the industrialists, and the cultural and intellectual elites. The Labour Party elected (twice) a veteran leftist (Jeremy Corbyn), widely contested by the party establishment and yet able to benefit from remarkable electoral support in the elections of 2017. In Greece and Spain the traditional parties of the left (PASOK in Greece and the PSOE in Spain) have been humiliated in elections by parties to their left: in Greece by Syriza (Coalition of the Radical Left, which became the leading force in the elections of 2015), and in Spain by Podemos (‘We Can’, founded in 2014), which, in the election of 2015 disrupted the two-party system extant since the end of the dictatorship. One can go on, but it seems that the kind of political consensus that had prevailed in the West for decades is being seriously challenged.
The Anxious Triumph Page 72