Category Archives: Neoliberalism

Democracy in Chains: The Deep History of the Radical Right’s Stealth Plan for America – Nancy Maclean. 

In 1955 the U.S. Supreme Court issued its second Brown v. Board of Education ruling, calling for the dismantling of segregation in public schools with “all deliberate speed.”

Thirty-seven-year-old James McGill Buchanan liked to call himself a Tennessee country boy. No less a figure than Milton Friedman had extolled Buchanan’s potential. As Colgate Whitehead Darden Jr., the president of the University of Virginia reviewed the document, he might have wondered if the newly hired economist had read his mind. For without mentioning the crisis at hand, Buchanan’s proposal put in writing what Darden was thinking: Virginia needed to find a better way to deal with the incursion on states’ rights represented by Brown.

States’ rights, in effect, were yielding in preeminence to individual rights. It was not difficult for either Darden or Buchanan to imagine how a court might now rule if presented with evidence of the state of Virginia’s archaic labor relations, its measures to suppress voting, or its efforts to buttress the power of reactionary rural whites by underrepresenting the moderate voters of the cities and suburbs of Northern Virginia. Federal meddling could rise to levels once unimaginable.

What the court ruling represented to Buchanan was personal. Northern liberals—the very people who looked down upon southern whites like him, he was sure—were now going to tell his people how to run their society. And to add insult to injury, he and people like him with property were no doubt going to be taxed more to pay for all the improvements that were now deemed necessary and proper for the state to make.

Find the resources, he proposed to Darden, for me to create a new center on the campus of the University of Virginia, and I will use this center to create a new school of political economy and social philosophy. It would be an academic center, rigorously so, but one with a quiet political agenda: to defeat the “perverted form” of liberalism that sought to destroy their way of life, “a social order,” as he described it, “built on individual liberty,” a term with its own coded meaning but one that Darden surely understood. The center, Buchanan promised, would train “a line of new thinkers” in how to argue against those seeking to impose an “increasing role of government in economic and social life.”

Buchanan fully understood the scale of the challenge he was undertaking and promised no immediate results. But he made clear that he would devote himself passionately to this cause.

Buchanan’s team had no discernible success in decreasing the federal government’s pressure on the South all the way through the 1960s and ’70s. But take a longer view—follow the story forward to the second decade of the twenty-first century—and a different picture emerges, one that is both a testament to Buchanan’s intellectual powers and, at the same time, the utterly chilling story of the ideological origins of the single most powerful and least understood threat to democracy today: the attempt by the billionaire-backed radical right to undo democratic governance.

A quest that began as a quiet attempt to prevent the state of Virginia from having to meet national democratic standards of fair treatment and equal protection under the law would, some sixty years later, become the veritable opposite of itself: a stealth bid to reverse-engineer all of America, at both the state and the national levels, back to the political economy and oligarchic governance of midcentury Virginia, minus the segregation.

The goal of all these actions was to destroy our institutions, or at least change them so radically that they became shadows of their former selves?

This, then, is the true origin story of today’s well-heeled radical right, told through the intellectual arguments, goals, and actions of the man without whom this movement would represent yet another dead-end fantasy of the far right, incapable of doing serious damage to American society.

When I entered Buchanan’s personal office, part of a stately second-floor suite, I felt overwhelmed. There were papers stacked everywhere, in no discernible order. Not knowing where to begin, I decided to proceed clockwise, starting with a pile of correspondence that was resting, helter-skelter, on a chair to the left of the door. I picked it up and began to read. It contained confidential letters from 1997 and 1998 concerning Charles Koch’s investment of millions of dollars in Buchanan’s Center for Study of Public Choice and a flare-up that followed.

Catching my breath, I pulled up an empty chair and set to work. It took me time—a great deal of time—to piece together what these documents were telling me. They revealed how the program Buchanan had first established at the University of Virginia in 1956 and later relocated to George Mason University, the one meant to train a new generation of thinkers to push back against Brown and the changes in constitutional thought and federal policy that had enabled it, had become the research-and-design center for a much more audacious project, one that was national in scope. This project was no longer simply about training intellectuals for a battle of ideas; it was training operatives to staff the far-flung and purportedly separate, yet intricately connected, institutions funded by the Koch brothers and their now large network of fellow wealthy donors. These included the Cato Institute, the Heritage Foundation, Citizens for a Sound Economy, Americans for Prosperity, FreedomWorks, the Club for Growth, the State Policy Network, the Competitive Enterprise Institute, the Tax Foundation, the Reason Foundation, the Leadership Institute, and more, to say nothing of the Charles Koch Foundation and Koch Industries itself.

I learned how and why Charles Koch first became interested in Buchanan’s work in the early 1970s, called on his help with what became the Cato Institute, and worked with his team in various organizations. What became clear is that by the late 1990s, Koch had concluded that he’d finally found the set of ideas he had been seeking for at least a quarter century by then—ideas so groundbreaking, so thoroughly thought-out, so rigorously tight, that once put into operation, they could secure the transformation in American governance he wanted. From then on, Koch contributed generously to turning those ideas into his personal operational strategy to, as the team saw it, save capitalism from democracy—permanently.

In his first big gift to Buchanan’s program, Charles Koch signaled his desire for the work he funded to be conducted behind the backs of the majority. “Since we are greatly outnumbered,” Koch conceded to the assembled team, the movement could not win simply by persuasion. Instead, the cause’s insiders had to use their knowledge of “the rules of the game”—that game being how modern democratic governance works—“to create winning strategies.” A brilliant engineer with three degrees from MIT, Koch warned, “The failure to use our superior technology ensures failure.” Translation: the American people would not support their plans, so to win they had to work behind the scenes, using a covert strategy instead of open declaration of what they really wanted.

Future-oriented, Koch’s men (and they are, overwhelmingly, men) gave no thought to the fate of the historical trail they left unguarded. And thus, a movement that prided itself, even congratulated itself, on its ability to carry out a revolution below the radar of prying eyes (especially those of reporters) had failed to lock one crucial door: the front door to a house that let an academic archive rat like me, operating on a vague hunch, into the mind of the man who started it all.

What animated Buchanan, what became the laser focus of his deeply analytic mind, was the seemingly unfettered ability of an increasingly more powerful federal government to force individuals with wealth to pay for an increasing number of public goods and social programs they had had no personal say in approving. Better schools, newer textbooks, and more courses for black students might help the children, for example, but whose responsibility was it to pay for these improvements? The parents of these students? Others who wished voluntarily to help out? Or people like himself, compelled through increasing taxation to contribute to projects they did not wish to support? To Buchanan, what others described as taxation to advance social justice or the common good was nothing more than a modern version of mob attempts to take by force what the takers had no moral right to: the fruits of another person’s efforts. In his mind, to protect wealth was to protect the individual against a form of legally sanctioned gangsterism. Where did this gangsterism begin? Not in the way we might have expected him to explain it to Darden: with do-good politicians, aspiring attorneys seeking to make a name for themselves in constitutional law, or even activist judges. It began before that: with individuals, powerless on their own, who had figured out that if they joined together to form social movements, they could use their strength in numbers to move government officials to hear their concerns and act upon them.

The only fact that registered in his mind was the “collective” source of their power—and that, once formed, such movements tended to stick around, keeping tabs on government officials and sometimes using their numbers to vote out those who stopped responding to their needs. How was this fair to other individuals? How was this American?

Even when conservatives later gained the upper hand in American politics, Buchanan saw his idea of economic liberty pushed aside. Richard Nixon expanded government more than his predecessors had, with costly new agencies and regulations, among them a vast new Environmental Protection Agency. George Wallace, a candidate strongly identified with the South and with the right, nonetheless supported public spending that helped white people. Ronald Reagan talked the talk of small government, but in the end, the deficit ballooned during his eight years in office.

Had there not been someone else as deeply frustrated as Buchanan, as determined to fight the uphill fight, but in his case with much keener organizational acumen, the story this book tells would no doubt have been very different. But there was. His name was Charles Koch. An entrepreneurial genius who had multiplied the earnings of the corporation he inherited by a factor of at least one thousand, he, too, had an unrealized dream of liberty, of a capitalism all but free of governmental interference and, at least in his mind, thus able to achieve the prosperity and peace that only this form of capitalism could produce. The puzzle that preoccupied him was how to achieve this in a democracy where most people did not want what he did.

Ordinary electoral politics would never get Koch what he wanted. Passionate about ideas to the point of obsession, Charles Koch had worked for three decades to identify and groom the most promising libertarian thinkers in hopes of somehow finding a way to break the impasse. He subsidized and at one point even ran an obscure academic outfit called the Institute for Humane Studies in that quest. “I have supported so many hundreds of scholars” over the years, he once explained, “because, to me, this is an experimental process to find the best people and strategies.”

The goal of the cause, Buchanan announced to his associates, should no longer be to influence who makes the rules, to vest hopes in one party or candidate. The focus must shift from who rules to changing the rules. For liberty to thrive, Buchanan now argued, the cause must figure out how to put legal—indeed, constitutional shackles on public officials, shackles so powerful that no matter how sympathetic these officials might be to the will of majorities, no matter how concerned they were with their own reelections, they would no longer have the ability to respond to those who used their numbers to get government to do their bidding. There was a second, more diabolical aspect to the solution Buchanan proposed, one that we can now see influenced Koch’s own thinking. Once these shackles were put in place, they had to be binding and permanent. The only way to ensure that the will of the majority could no longer influence representative government on core matters of political economy was through what he called “constitutional revolution.”

By the late 1990s, Charles Koch realized that the thinker he was looking for, the one who understood how government became so powerful in the first place and how to take it down in order to free up capitalism—the one who grasped the need for stealth because only piecemeal, yet mutually reinforcing, assaults on the system would survive the prying eyes of the media, was James Buchanan.

The Koch team’s most important stealth move, and the one that proved most critical to success, was to wrest control over the machinery of the Republican Party, beginning in the late 1990s and with sharply escalating determination after 2008. From there it was just a short step to lay claim to being the true representatives of the party, declaring all others RINOS—Republicans in name only. But while these radicals of the right operate within the Republican Party and use that party as a delivery vehicle, make no mistake about it: the cadre’s loyalty is not to the Grand Old Party or its traditions or standard-bearers. Their loyalty is to their revolutionary cause.

Our trouble in grasping what has happened comes, in part, from our inherited way of seeing the political divide. Americans have been told for so long, from so many quarters, that political debate can be broken down into conservative versus liberal, pro-market versus pro-government, Republican versus Democrat, that it is hard to recognize that something more confounding is afoot, a shrewd long game blocked from our sight by these stale classifications.

The Republican Party is now in the control of a group of true believers for whom compromise is a dirty word. Their cause, they say, is liberty. But by that they mean the insulation of private property rights from the reach of government, and the takeover of what was long public (schools, prisons, western lands, and much more) by corporations, a system that would radically reduce the freedom of the many. In a nutshell, they aim to hollow out democratic resistance. And by its own lights, the cause is nearing success.

The 2016 election looked likely to bring a big presidential win with across-the-board benefits. The donor network had so much money and power at its disposal as the primary season began that every single Republican presidential front-runner was bowing to its agenda. Not a one would admit that climate change was a real problem or that guns weren’t good, and the more widely distributed, the better. Every one of them attacked public education and teachers’ unions and advocated more charter schools and even tax subsidies for religious schools. All called for radical changes in taxation and government spending. Each one claimed that Social Security and Medicare were in mortal crisis and that individual retirement and health savings accounts, presumably to be invested with Wall Street firms, were the best solution.

Although Trump himself may not fully understand what his victory signaled, it put him between two fundamentally different, and opposed, approaches to political economy, with real-life consequences for us all. One was in its heyday when Buchanan set to work. In economics, its standard-bearer was John Maynard Keynes, who believed that for a modern capitalist democracy to flourish, all must have a share in the economy’s benefits and in its governance. Markets had great virtues, Keynes knew—but also significant built-in flaws that only government had the capacity to correct.

As a historian, I know that his way of thinking, as implemented by elected officials during the Great Depression, saved liberal democracy in the United States from the rival challenges of fascism and Communism in the face of capitalism’s most cataclysmic collapse. And that it went on to shape a postwar order whose operating framework yielded ever more universal hope that, by acting together and levying taxes to support shared goals, life could be made better for all.

The most starkly opposed vision is that of Buchanan’s Virginia school. It teaches that all such talk of the common good has been a smoke screen for “takers” to exploit “makers,” in the language now current, using political coalitions to “vote themselves a living” instead of earning it by the sweat of their brows. Where Milton Friedman and F. A. Hayek allowed that public officials were earnestly trying to do right by the citizenry, even as they disputed the methods, Buchanan believed that government failed because of bad faith: because activists, voters, and officials alike used talk of the public interest to mask the pursuit of their own personal self-interest at others’ expense. His was a cynicism so toxic that, if widely believed, it could eat like acid at the foundations of civic life. And he went further by the 1970s, insisting that the people and their representatives must be permanently prevented from using public power as they had for so long. Manacles, as it were, must be put on their grasping hands.

Is what we are dealing with merely a social movement of the right whose radical ideas must eventually face public scrutiny and rise or fall on their merits? Or is this the story of something quite different, something never before seen in American history? Could it be—and I use these words quite hesitantly and carefully—a fifth-column assault on American democratic governance?

The term “fifth column” has been applied to stealth supporters of an enemy who assist by engaging in propaganda and even sabotage to prepare the way for its conquest.

This cause is different. Pushed by relatively small numbers of radical-right billionaires and millionaires who have become profoundly hostile to America’s modern system of government, an apparatus decades in the making, funded by those same billionaires and millionaires, has been working to undermine the normal governance of our democracy. Indeed, one such manifesto calls for a “hostile takeover” of Washington, D.C. That hostile takeover maneuvers very much like a fifth column, operating in a highly calculated fashion, more akin to an occupying force than to an open group engaged in the usual give-and-take of politics. The size of this force is enormous. The social scientists who have led scholars in researching the Koch network write that it “operates on the scale of a national U.S. political party” and employs more than three times as many people as the Republican committees had on their payrolls in 2015.

For all its fine phrases, what this cause really seeks is a return to oligarchy, to a world in which both economic and effective political power are to be concentrated in the hands of a few. It would like to reinstate the kind of political economy that prevailed in America at the opening of the twentieth century, when the mass disfranchisement of voters and the legal treatment of labor unions as illegitimate enabled large corporations and wealthy individuals to dominate Congress and most state governments alike, and to feel secure that the nation’s courts would not interfere with their reign. The first step toward understanding what this cause actually wants is to identify the deep lineage of its core ideas. And although its spokespersons would like you to believe they are disciples of James Madison, the leading architect of the U.S. Constitution, it is not true.

Their intellectual lodestar is John C. Calhoun. He developed his radical critique of democracy a generation after the nation’s founding, as the brutal economy of chattel slavery became entrenched in the South, and his vision horrified Madison.

***

Democracy in Chains: The Deep History of the Radical Right’s Stealth Plan for America 

by Nancy Maclean

Nancy K. MacLean is an American historian. She is the William H. Chafe Professor of History and Public Policy at Duke University and the author of numerous books and articles on various aspects of twentieth-century United States history.

get it from Amazon

G20: Does Donald Trump’s awkward performance indicate America’s decline as a world power? – Chris Uhlmann. 

The G20 became the G19 as it ended. On the Paris climate accords the United States was left isolated and friendless.

It is, apparently, where this US President wants to be as he seeks to turn his nation inward.

Donald Trump has a particular, and limited, skill-set. He has correctly identified an illness at the heart of the Western democracy. But he has no cure for it and seems to just want to exploit it.

He is a character drawn from America’s wild west, a travelling medicine showman selling moonshine remedies that will kill the patient.

And this week he underlined he has neither the desire nor the capacity to lead the world.

Given the US was always going to be one out on climate change, a deft American President would have found an issue around which he could rally most of the leaders.

He had the perfect vehicle — North Korea’s missile tests.

So, where was the G20 statement condemning North Korea? That would have put pressure on China and Russia? Other leaders expected it and they were prepared to back it but it never came.

There is a tendency among some hopeful souls to confuse the speeches written for Mr Trump with the thoughts of the man himself.

He did make some interesting, scripted, observations in Poland about defending the values of the West.

And Mr Trump is in a unique position — he is the one man who has the power to do something about it.

But it is the unscripted Mr Trump that is real. A man who barks out bile in 140 characters, who wastes his precious days as President at war with the West’s institutions — like the judiciary, independent government agencies and the free press.

He was an uneasy, awkward figure at this gathering and you got the strong sense some other leaders were trying to find the best way to work around him.

Mr Trump is a man who craves power because it burnishes his celebrity. To be constantly talking and talked about is all that really matters. And there is no value placed on the meaning of words. So what is said one day can be discarded the next.

So, what did we learn this week?

We learned Mr Trump has pressed fast forward on the decline of the US as a global leader. He managed to diminish his nation and to confuse and alienate his allies.

He will cede that power to China and Russia — two authoritarian states that will forge a very different set of rules for the 21st century.

Some will cheer the decline of America, but I think we’ll miss it when it is gone.

And that is the biggest threat to the values of the West which he claims to hold so dear.

ABC

The Mother of all Blunders – Bryan Gould. 

“Neoliberal economic policies have failed, and an important aspect of that failure has been that most of such new wealth as has been created has gone to the richest people in society.”

Jim Blogger, former NZ Prime Minister

Jim Bolger headed a government that set about cutting taxes and therefore public services, and weakening trade unions, policies often seen as the hallmarks of neo-liberalism, and that is to say nothing of Ruth Richardson and her boast of delivering “the mother of all budgets”.

It is beyond dispute that the countries which have enjoyed the best economic outcomes have been those – like the Scandinavian countries – which have at the same time most stoutly resisted the growth of inequality.  As for the rest, the application of neo-liberal policies has meant a poorer economic performance, accompanied by greater social division.

We do not have to choose, in other words and as is so often asserted, between social justice and economic success.  The former is an essential element in producing the latter and is not just a “luxury” we can do without.

Or, to put it in another way, the failure of neo-liberal policies is largely attributable to their inevitable tendency to exacerbate inequality and to foster a lack of concern for the less fortunate.

And a moment’s reflection will tell us why that is so.  An economy will always be more successful if it engages with and uses all of its productive capacity – and that means its human resources – rather than leaving some of them under-used and undervalued.

The loss and damage we sustain, if we fail to take account of the interests of the whole of society, creates not only a weaker economy, but a more divided and unhappier society.

In today’s politics, it is the right that is ideologically driven while it is the left that constantly seeks merely pragmatic solutions to pressing problems.  The left’s difficulties in attracting majority public support suggest that solutions to problems will stand a better chance of being accepted if they are seen to be grounded in a coherent analysis of what has gone wrong.

It may be that, in their anxiety to gain support from the “middle ground”, the left has too easily been frightened away from developing such an analysis.  Surprisingly, they seem reluctant to engage in an ideological debate and prefer to leave the territory uncontested.

If Jim Bolger can do it, and link outcomes to policy frameworks, why not the left?  But, if there were to be a next time, Jim, could you please see the light and find the road to Damascus a little sooner?

Bryan Gould

How a Ruthless Network of Super-Rich Ideologues Killed Choice and Destroyed People’s Faith in Politics – George Monbiot. 

Neoliberalism: the deep story that lies beneath Donald Trump’s triumph.

The events that led to Donald Trump’s election started in England in 1975. At a meeting a few months after Margaret Thatcher became leader of the Conservative party, one of her colleagues, or so the story goes, was explaining what he saw as the core beliefs of conservatism. She snapped open her handbag, pulled out a dog-eared book, and slammed it on the table. “This is what we believe,” she said. A political revolution that would sweep the world had begun.

The book was The Constitution of Liberty by Frederick Hayek. Its publication, in 1960, marked the transition from an honest, if extreme, philosophy to an outright racket. The philosophy was called neoliberalism. It saw competition as the defining characteristic of human relations. The market would discover a natural hierarchy of winners and losers, creating a more efficient system than could ever be devised through planning or by design. Anything that impeded this process, such as significant tax, regulation, trade union activity or state provision, was counter-productive. Unrestricted entrepreneurs would create the wealth that would trickle down to everyone.

This, at any rate, is how it was originally conceived. But by the time Hayek came to write The Constitution of Liberty, the network of lobbyists and thinkers he had founded was being lavishly funded by multimillionaires who saw the doctrine as a means of defending themselves against democracy. Not every aspect of the neoliberal programme advanced their interests. Hayek, it seems, set out to close the gap.

He begins the book by advancing the narrowest possible conception of liberty: an absence of coercion. He rejects such notions as political freedom, universal rights, human equality and the distribution of wealth, all of which, by restricting the behaviour of the wealthy and powerful, intrude on the absolute freedom from coercion he demands.

Democracy, by contrast, “is not an ultimate or absolute value”. In fact, liberty depends on preventing the majority from exercising choice over the direction that politics and society might take.

He justifies this position by creating a heroic narrative of extreme wealth. He conflates the economic elite, spending their money in new ways, with philosophical and scientific pioneers. Just as the political philosopher should be free to think the unthinkable, so the very rich should be free to do the undoable, without constraint by public interest or public opinion.

The ultra rich are “scouts”, “experimenting with new styles of living”, who blaze the trails that the rest of society will follow. The progress of society depends on the liberty of these “independents” to gain as much money as they want and spend it how they wish. All that is good and useful, therefore, arises from inequality. There should be no connection between merit and reward, no distinction made between earned and unearned income, and no limit to the rents they can charge.

Inherited wealth is more socially useful than earned wealth: “the idle rich”, who don’t have to work for their money, can devote themselves to influencing “fields of thought and opinion, of tastes and beliefs”. Even when they seem to be spending money on nothing but “aimless display”, they are in fact acting as society’s vanguard.

Hayek softened his opposition to monopolies and hardened his opposition to trade unions. He lambasted progressive taxation and attempts by the state to raise the general welfare of citizens. He insisted that there is “an overwhelming case against a free health service for all” and dismissed the conservation of natural resources. It should come as no surprise to those who follow such matters that he was awarded the Nobel prize for economics.

By the time Thatcher slammed his book on the table, a lively network of thinktanks, lobbyists and academics promoting Hayek’s doctrines had been established on both sides of the Atlantic, abundantly financed by some of the world’s richest people and businesses, including DuPont, General Electric, the Coors brewing company, Charles Koch, Richard Mellon Scaife, Lawrence Fertig, the William Volker Fund and the Earhart Foundation. Using psychology and linguistics to brilliant effect, the thinkers these people sponsored found the words and arguments required to turn Hayek’s anthem to the elite into a plausible political programme.

Thatcherism and Reaganism were not ideologies in their own right: they were just two faces of neoliberalism. Their massive tax cuts for the rich, crushing of trade unions, reduction in public housing, deregulation, privatisation, outsourcing and competition in public services were all proposed by Hayek and his disciples. But the real triumph of this network was not its capture of the right, but its colonisation of parties that once stood for everything Hayek detested.

Bill Clinton and Tony Blair did not possess a narrative of their own. Rather than develop a new political story, they thought it was sufficient to triangule. In other words, they extracted a few elements of what their parties had once believed, mixed them with elements of what their opponents believed, and developed from this unlikely combination a “third way”.

It was inevitable that the blazing, insurrectionary confidence of neoliberalism would exert a stronger gravitational pull than the dying star of social democracy. Hayek’s triumph could be witnessed everywhere from Blair’s expansion of the private finance initiative to Clinton’s repeal of the Glass-Steagal Act, which had regulated the financial sector. For all his grace and touch, Barack Obama, who didn’t possess a narrative either (except “hope”), was slowly reeled in by those who owned the means of persuasion.

As I warned in April, the result is first disempowerment then disenfranchisement. If the dominant ideology stops governments from changing social outcomes, they can no longer respond to the needs of the electorate. Politics becomes irrelevant to people’s lives; debate is reduced to the jabber of a remote elite. The disenfranchised turn instead to a virulent anti-politics in which facts and arguments are replaced by slogans, symbols and sensation. The man who sank Hillary Clinton’s bid for the presidency was not Donald Trump. It was her husband.

The paradoxical result is that the backlash against neoliberalism’s crushing of political choice has elevated just the kind of man that Hayek worshipped. Trump, who has no coherent politics, is not a classic neoliberal. But he is the perfect representation of Hayek’s “independent”; the beneficiary of inherited wealth, unconstrained by common morality, whose gross predilections strike a new path that others may follow. The neoliberal thinktankers are now swarming round this hollow man, this empty vessel waiting to be filled by those who know what they want. The likely result is the demolition of our remaining decencies, beginning with the agreement to limit global warming.

Those who tell the stories run the world. Politics has failed through a lack of competing narratives. The key task now is to tell a new story of what it is to be a human in the 21st century. It must be as appealing to some who have voted for Trump and Ukip as it is to the supporters of Clinton, Bernie Sanders or Jeremy Corbyn.

A few of us have been working on this, and can discern what may be the beginning of a story. It’s too early to say much yet, but at its core is the recognition that – as modern psychology and neuroscience make abundantly clear – human beings, by comparison with any other animals, are both remarkably social and remarkably unselfish. The atomisation and self-interested behaviour neoliberalism promotes run counter to much of what comprises human nature.

Hayek told us who we are, and he was wrong. Our first step is to reclaim our humanity.

Evonomics.com

Europe’s Centre-Left Risks Irrelevance – Sheri Berman. 

JUST LIKE NEW ZEALAND’S, LABOUR NEEDS TO WISE UP!

Europe today is in crisis. Economically, much of the continent suffers from low growth, high unemployment and rising inequality, while politically, disillusionment with the European community as well as domestic institutions and elites is widespread. Partially as a result, right-wing populism is growing, increasing political instability and uncertainty even further. Although many have noted a correlation between the rise of populism and the decline of the social democratic or centre-left, the causal relationship between them has not been sufficiently stressed. Indeed, to a large degree the failures of the latter explain the surprising popularity of the former.

The historical role of the centre or social democratic left

Although the decline of social democracy and the rise of populism have become particularly noticeable since the financial crisis that began in 2008, the roots of both lie much earlier, in the 1970s. During this decade economic and social/cultural changes began unsettling long-standing voting and political patterns. Economically, the postwar order was running out of steam, and a noxious mix of unemployment and inflation hit Europe. However, social democrats lacked well thought out plans for getting economies moving again or for using the democratic state to protect citizens from the changes brought by ever-evolving capitalism.

Such plans, of course, had been precisely what social democracy had offered after 1945. Back then, social democrats had not only insisted that it was possible to reform and even improve capitalism – they devised concrete policy proposals for accomplishing this task. These policies enabled governments to contain and cushion the most destructive and destabilising consequences of markets without fettering them entirely. In contrast, during the late twentieth and early twenty-first centuries, social democrats offered either rearguard defences of socioeconomic policies that may have made sense decades ago but which are now out of touch with the realities of a changing global economy, or else watered-down versions of neoliberalism (such as the English “Third Way” or the German “Neue Mitte”) that left many citizens wondering why they should bother to vote for the social democratic or centre-left at all.

The absence of a distinctive, effective social democratic response to economic problems allowed a neoliberal right that had been organising and thinking about what it saw as the drawbacks of the postwar order to begin freeing capitalism from many of the restrictions that had been placed on it beginning in the 1970s. And this unfettered capitalism, in turn, not only helped create the financial crisis of the early twenty-first century, it also drove many voters to the populist right which explicitly promised to reign it in and protect “true” citizens from its harshest effects.

At the same time that European economies were changing, so were European societies. Social and cultural changes unleashed in the late 1960s threatened traditional identities, communities and mores, a process further exacerbated by growing immigration. Together these trends helped erode the social solidarity and sense of shared national purpose that had supported the social democratic postwar order and helped to stabilise European democracies in the decades following the Second World War.

Historically, social democrats recognised and indeed promoted social solidarity and a sense of shared national purpose, identifying these as necessary to the legitimacy of high taxes and a strong welfare state. During the last decades of the twentieth century, however, this basic fact was all too often forgotten or wished away by a centre or social democratic left that lacked distinctive, effective responses to the social, cultural and demographic changes that weakened the sense of solidarity and shared national purpose across one European country after another.

The absence of a distinctive, effective social democratic response to growing diversity allowed the extreme or multicultural left to become the loudest left-wing voice on this issue. This camp tends to see society as divided into irreconcilable groups, with different values and traditions all around. Efforts to find common ground or ease differences, in this view, are undesirable and counterproductive.

This emphasis on the “politics of recognition” – as opposed to the centre-left’s traditional emphasis on the “politics of redistribution” – was bad for the left and bad for democracy. It led many intellectuals away from a focus on economic issues and fragmented the left in a way that makes it hard to build majority coalitions and win elections. It also makes it almost impossible to generate the social solidarity or shared sense of national purpose that is necessary to support the rest of the centre-left agenda or healthy democracy more generally. And of course, a stress on the primacy of racial, religious, or sexual identity over class or even national identity, along with the implicit and often explicit denigration of those worried about the rapidly changing nature of their societies, has also helped to drive many voters to the nationalist, populist right.

The current crisis

It is now fairly commonplace to note the support given by traditionally left or social democratic voters to the populist right. This connection was on obvious display in the Brexit referendum, where many traditional Labour strongholds and supporters voted to leave the EU, and it has been a prominent feature of elections across the continent as working-class voters in particular have flocked to right-wing populist parties. And of course, a version of this was present in the United States, where Donald Trump garnered disproportionate support from less-educated and working-class voters. What is still worth stressing, however, is the causal connection between the failures or missteps of the centre or social democratic left and the rise of right-wing populism.

During the decades following the Second World war, centre-left and social democratic parties offered attractive solutions to the economic and social challenges facing European democracies. They promised citizens an economic order that neither erased capitalism (as many on the far left desired) nor gave it free rein (as classical liberals and contemporary neoliberals favour). Instead, they promised citizens the benefits of capitalist economic dynamism and innovation as well as to shield them from capitalism’s sometimes destructive effects.

The centre or social democratic left also promoted social solidarity and a sense of national purpose – welfare states would protect the health and well-being of all citizens and government would commit itself to creating an equal and prosperous society that benefited all. By the last decades of the twentieth century, however, the centre or social democratic left no longer had convincing responses to the most pressing economic and social challenges facing European societies, and voters accordingly began looking for other political alternatives.

For many former or traditionally left voters, the most attractive alternative turned out to be the populist right, which offered simple, straightforward solutions to citizens’ economic and social fears. Economically, the populist right promises to promote prosperity, via increased government control of the economy and limits on globalisation. Socially, the populist right promises to restore social solidarity and a sense of shared national purpose, by expelling foreigners or severely limiting immigration; diminishing the influence of the European Union, and protecting traditional values, identities and mores.

For those who bemoan the rise of the populist right, the challenge is clear: you can’t beat something with nothing and if the left can’t come up with more viable and attractive solutions to contemporary problems than those offered by its competitors it can expect to continue its slide into the dustheap of history.
Social Europe

John Key, The Smiling Assassin. He pulled ponytails instead of grabbing pussies – The Guardian. 

John Key’s legacy will not be defined by great policy achievements; it’s his success as the model of a neoliberal leader, a poster boy for trickle-down economics, that he will be remembered for.

Key presided over increasing and gross social inequality.

Like another poster boy for trickle-down economics, Tony Blair, the New Zealand prime minister had the Teflon gene. Even while presiding over record levels of child poverty, his popularity remained high.

Despite ignoring public preferences not to privatise state-owned enterprises, increasing the GST, and more-or-less ignoring New Zealand’s chronic child poverty, because he blamed the victims, none of it stuck.

Only because the average greedy Kiwi is not only politically naive but also has succumb to Neoliberal doctrine and decided ‘To hell with everybody else, I’m getting as much as I can for Me Me Me.’

Key was like a Tony Blair of the South Seas: a certain level of personal charisma and a socially inclusive façade allowed both Key and Blair to sell the nasty side of neoliberalism.

Never mind the hundreds of thousands of children living under the poverty line in New Zealand, a country of only four million, and him brushing off the recommendations of the government panel charged with improving their lot; Key was seen as a good guy and a safe pair of hands.

Key was a person who fitted the narrative of Neoliberalism perfectly, he was a man of his time. He came of age at a time when a Neoliberal coup turned the more-or-less socialist mixed economy of New Zealand on its head.

As financial markets were deregulated and the Keynesian social consensus dismantled, Key began his ascendency to banking-money heaven.

The heart of the Key narrative, like the Trump narrative, is money.

They both have a personal story about business acumen and the notion that making money is the high art of society and the hallmark of good character.

It’s no coincidence that this “good with money” story has found such great traction and continues to propel wealthy business people into political power. In New Zealand, and many other countries, including Australia, the UK and the US, there’s a powerful narrative that says that running a government is very much like running a company; you must balance the books first of all.

Equating the values of entrepreneurship and fiscal discipline with the judgment required to legislate in the public interest is crude nonsense.

But this money story not only has currency, it is the currency of the reigning monetarist fiscal discourse.

Many of the opponents of neoliberalism, including those who tried to unseat Key, still haven’t figured out how to counter the “money story”.

Labour parties around the world have long been experiencing an identity crisis: they are divided between their complicity in creating a neoliberal society, their adoption of Keynesian responses to the global financial crisis and the ideological opposition to neoliberalism among their ranks, in the form of, for example, Jeremy Corbyn and Bernie Sanders.

Until you pull that money story apart, and New Zealand Labour still need to do this, people do buy into it, and they kept voting Key in because they believed in the equation that “good with money” equals “morally upstanding”.

People don’t want this bubble popped.

The Guardian 

Those who claim to be on the side of freedom while ignoring the growing imbalance of economic and political power in America and other advanced economies are not in fact on the side of freedom. They are on the side of those with the power. – Robert Reich

As economic and political power have once again moved into the hands of a relative few large corporations and wealthy individuals, “freedom” is again being used to justify the multitude of ways they entrench and enlarge that power by influencing the rules of the game.

These include escalating campaign contributions, as well as burgeoning “independent” campaign expenditures, often in the form of negative advertising targeting candidates whom they oppose; growing lobbying prowess, both in Washington and in state capitals; platoons of lawyers and paid experts to defend against or mount lawsuits, so that courts interpret the laws in ways that favor them; additional lawyers and experts to push their agendas in agency rule-making proceedings; the prospect of (or outright offers of) lucrative private-sector jobs for public officials who define or enforce the rules in ways that benefit them; public relations campaigns designed to convince the public of the truth and wisdom of policies they support and the falsity and deficiency of policies they don’t; think tanks and sponsored research that confirm their positions; and ownership of, or economic influence over, media outlets that further promote their goals.

Robert Reich, from his book ‘Saving Capitalism’