The neo conservative stranglehold

While the economic crisis threatens to become worse than the 1930s, there is a curious difference from back then. There is no search for an alternative system. As Colin Crouch’s new book suggests, the death of neo – liberalism (or neo conservatism) could have been expected from the economic disasters from 2008. But no such thing has happened. Why is this?

0It is normal that when an economic system fails, as laissez faire before the First World War or Keynsianism in the oil crisis of the 1970s, then economists and politicians move to an alternative. This has not happened with neo- liberalism though the current crisis is far worse than the stagflation which ended Keynsianism forty years ago and brought about the shift to a new paradigm, the neo liberalism which in this country became known as Thatcherism.

And as Peter Mandleson said, we are all Thatcherites now. He was wrong, but while the non-Thatcherites stayed around, they were silenced by the domination of de-regulation and the apparent ability of the new theory to bring about full employment, growth and riches across a new globalised economy with major new players like China and India joining the dash for growth. As Francis Fukayama famously noted, it was the end of History. Liberal capitalism had won, and for ever and a day this was the new world order.

To be fair to Fukuyama, he stopped riding the neo liberal bandwagon before it came off the rails in 2008. But very few followed him, certainly not among the cohort of Nobel Prize winning economists who failed to predict the imminent collapse of their theories. A few perceptive observers did, and in the UK Vince Cable stands out. However what is more important – and the focus of Colin Crouch’s new book THE STRANGE NON DEATH OF NEO LIBERALISM – is what happened next. Which is precisely nothing.

The dominance of finance capitalism and the big corporation remains, the people at the top reward themselves the bonuses of success for delivering economic failure, and the rest of us suffer major cuts to keep the super rich in the manner to which they have become accustomed. This is a major conundrum. Sadly, Crounch throws very little light on it, arguing there is no way out of the tunne.

Crouch notes that three major elements of modern life have come to an accomodation – The state (ie politicians), the market (or more precisely its ideologues) and the corporation. This, he argues is “largely inevitable and not always malign”. As analysis this is accurate, but as prescription it is deeply flawed. Analytically it cannot be denied that the situation post 2008 is that failed corporations have become too big to allow to fail, and that politicians see their role as being to maintain the fatness of fat cats. In this project, the rest of us must become learner, depriving non corporate interests (on both right and left) of the wherewithal to influence the political process.

But while he is right to talk of ‘post democracy’ this is certainly malign and is fundamentally unstable. A failing regime system which cannot be replaced or regulated will not survive. The only question is whether as in the twentieth century anti democratic forces will emerge as the democratic parties prove to have failed. The political elites are increasingly seen as corrupt and useless. There is no future in this.

This does not mean that solutions to the domination of neo liberalism are inevitable, far from it. The situation may be described as institutionally corrupt, in that the pursuit of money is the only goal and no countervailing projects are tolerated. This is not sustainable, but as the science fiction giant Isaac Asmimov commented of his genre “sci fi writers forsee the inevitable. Although problems and catastrophes may be inevitable, solutions are not”. But the priority has to be to seek them. Crouch’s believes that There Is No Alternative.  Critics of the status quo must accept impotence is the road to disaster. It must be rejected.

Trevor Fisher                                                                                    16 10 2011

The neo conservative stranglehold.

 

While the economic crisis threatens to become worse than the 1930s, there is a curious difference from back then. There is no search for an alternative system. As Colin Crouch’s new book suggests, the death of neo – liberalism (or neo conservatism) could have been expected from the economic disasters from 2008. But no such thing has happened. Why is this?

 

It is normal that when an economic system fails, as laissez faire before the First World War or Keynsianism in the oil crisis of the 1970s, then economists and politicians move to an alternative. This has not happened with neo- liberalism though the current crisis is far worse than the stagflation which ended Keynsianism forty years ago and brought about the shift to a new paradigm, the neo liberalism which in this country became known as Thatcherism.

 

And as Peter Mandleson said, we are all Thatcherites now. He was wrong, but while the non-Thatcherites stayed around, they were silenced by the domination of de-regulation and the apparent ability of the new theory to bring about full employment, growth and riches across a new globalised economy with major new players like China and India joining the dash for growth. As Francis Fukayama famously noted, it was the end of History. Liberal capitalism had won, and for ever and a day this was the new world order.

 

To be fair to Fukuyama, he stopped riding the neo liberal bandwagon before it came off the rails in 2008. But very few followed him, certainly not among the cohort of Nobel Prize winning economists who failed to predict the imminent collapse of their theories. A few perceptive observers did, and in the UK Vince Cable stands out. However what is more important – and the focus of Colin Crouch’s new book THE STRANGE NON DEATH OF NEO LIBERALISM – is what happened next. Which is precisely nothing.

 

The dominance of finance capitalism and the big corporation remains, the people at the top reward themselves the bonuses of success for delivering economic failure, and the rest of us suffer major cuts to keep the super rich in the manner to which they have become accustomed. This is a major conundrum. Sadly, Crounch throws very little light on it, arguing there is no way out of the tunne.

 

Crouch notes that three major elements of modern life have come to an accomodation – The state (ie politicians), the market (or more precisely its ideologues) and the corporation. This, he argues is “largely inevitable and not always malign”. As analysis this is accurate, but as prescription it is deeply flawed. Analytically it cannot be denied that the situation post 2008 is that failed corporations have become too big to allow to fail, and that politicians see their role as being to maintain the fatness of fat cats. In this project, the rest of us must become learner, depriving non corporate interests (on both right and left) of the wherewithal to influence the political process.

 

But while he is right to talk of ‘post democracy’ this is certainly malign and is fundamentally unstable. A failing regime system which cannot be replaced or regulated will not survive. The only question is whether as in the twentieth century anti democratic forces will emerge as the democratic parties prove to have failed. The political elites are increasingly seen as corrupt and useless. There is no future in this.
This does not mean that solutions to the domination of neo liberalism are inevitable, far from it. The situation may be described as institutionally corrupt, in that the pursuit of money is the only goal and no countervailing projects are tolerated. This is not sustainable, but as the science fiction giant Isaac Asmimov commented of his genre “sci fi writers forsee the inevitable. Although problems and catastrophes may be inevitable, solutions are not”. But the priority has to be to seek them. Crouch’s believes that There Is No Alternative.  Critics of the status quo must accept impotence is the road to disaster. It must be rejected.

 

Trevor Fisher                                                                                    16 10 2011

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