At this late date, it is not stop-the-presses news to point out that capitalism, globalization, democracy, and political liberalism have all come under heavy fire in recent years, with attacks emanating from both the right and the left. Each of these concepts qua concept has been pummeled, albeit in different ways, by pols on the hustings, academic scribblers, high-tone journalists, and Grub Street hacks. More seriously, various and sundry men on horseback have attempted, often successfully, to redefine and in some cases to repudiate the manifestations of these concepts in the real world, and in so doing, have altered “facts on the ground.” Most of these horsemen have been associated with the authoritarian right, but the upshot of the equestrianism, taken together, has been the retreat of both global capitalism and, more strikingly, political liberalism around the world, with some now seeing that governing principle—the “world's most successful political idea” according to distinguished journalist Bill Emmott—as extremely tired, if not tapped out.
Many of the critics of the above concepts prefer to focus on one target—globalization or democracy, for example—rather than connecting the dots. To be sure, some writers have proceeded otherwise, offering more unified interpretations of the current crisis. In this regard, one thinks immediately of journalists such as the aforementioned Emmott, Edward Luce, and Fareed Zakaria, as well as historian Niall Ferguson, but no one more so than Robert Kuttner, who has been analyzing these concepts in a unified way and with much the same smart and sophisticated interpretive line for several decades now.
What is this line? Basically, advocacy of a broadly social, constrained form of egalitarian capitalism, not unlike the political-economic order that began to emerge under FDR during the New Deal and that evolved in such a way in subsequent decades as to underpin and underwrite the “postwar boom” in the Western world that lasted all the way until the 1970s. Although the way in which this order evolved differed in the United States and Europe, and although its achievements, however real, were always incomplete, the agreed-upon assumptions guiding policy—predicated, first and foremost, on a commitment to an activist government that would empower labor and tightly regulate finance—were sufficiently sagacious and successful in Kuttner's view as to render possible the taming of that wild beast known as capitalism. Once tamed, capitalism proceeded to generate stable growth, enhanced security, increased economic equality, greater civic engagement, and, not surprisingly, a stronger societal commitment to democratic politics.
According to Kuttner, this socially beneficial form of capitalism was replaced in the West beginning in the 1970s by what he terms “neoliberal” capitalism, which he, like others on the “progressive” side of things, basically sees as a “predatory” form of laissez-faire capitalism, characterized by governmental policies designed to deregulate the economy, unleash business, particularly the financial sector, disempower labor, particularly organized labor, and reduce taxes and the role of the state more generally, particularly state functions that in any way promote more egalitarian social outcomes. However much the results of such policy preferences may have fattened the pocketbooks of elites in the United States and Europe over time, they have, Kuttner believes, proven harmful to most Americans and Europeans, whose incomes have stagnated over the past thirty-five years and whose lives have become increasingly insecure and, in many cases, precarious.
Moreover, as neoliberal regimes in the West increasingly encouraged business and finance to pursue profits globally in increasingly single-minded, not to say rapacious, ways, national borders and national economies came to matter less and less and offshore outsourcing more and more. With the incomes of most of the population in the developed world stagnating, and governments, by and large, primarily serving the interests of the elites, is it any wonder, Kuttner asks, that capitalism, globalization, and liberal democracy have lost support, as much of the populace became enthralled by illiberal parties and factions, nationalist economic programs, nativist policies, and faux populists such as Donald Trump? Hardly.
Kuttner, as suggested earlier, has been tilting against “laissez-faire,” finance-led capitalism for decades now in books such as The End of Laissez Faire: National Purpose and the Global Economy after the Cold War (1991), Everything for Sale: The Virtues and Limits of Markets (1998), The Squandering of America: How the Failure of Our Politics Undermines Our Prosperity (2007), Debtor's Prison: The Politics of Austerity Versus Possibility (2013), and now Can Democracy Survive Global Capitalism? What do we make of his critique? A lot depends on one's “priors,” as it were, which is to say (à la Bayes's theorem), on the beliefs and assumptions one already holds upon confronting and evaluating evidence—in this case, Kuttner's progressive hypothesis about the causes of our economic mess and political rot.
If one lists toward the progressive side of things regarding modern history—viewing the period between the beginning of the New Deal and the end of the Great Society in the United States (during which elaborate social-welfare schemes in northern Europe were being institutionalized) as being about as close to heaven as we are likely to get—you will find Kuttner's argument convincing, even compelling, despite the author's dense, often leaden prose. If, on the other hand, one is less enamored of progressive political nostra and is more sympathetic to the logic and discipline (and results) brought about in less-regulated market settings, one will find Kuttner's economic argument deeply flawed and his attempt to link causally neoliberal economics with illiberal, even neofascist politics overstated.
Those like myself, who find themselves somewhere in between, will appreciate many aspects of Kuttner's spirited, if at times relentless, critique of our current political-economic order without festooning him with garlands. Along with writers such as Gregg Easterbrook, Steven Pinker, and Hans Rosling, I do not believe that we are living through the worst of times, that the economic position of most of the world's population has not improved dramatically over the last thirty years, or that political liberalism—“the world's most successful political idea”—is in its death throes.
