Ctrl Alt Democracy — Long Rough Cut

This represents my draft summary of where we are.  It picks up on my recent themes.

It is based on my simplified notion of democracy as an action and not as a set of ideas, a structure, norms, or any such thing.  Democracy is something that happens.   It is not a form of government.  It is a consequence — an action — of government.  Specifically it is the action of enforcing a fair, or more equal, sharing of the spoils of production.  It is about equal access to consumption.  It is, therefore, distributive, confrontational, and hostile to elitist control of wealth.  It is what economics ought to be about, but is not. 

Let me begin [with apologies for repetitions etc as yet unedited]:

Ctrl.

Alt.

Democracy.

How we begin is crucial.  The start is when we establish the path ahead.  So that first step, however tentative, determines everything that follows.  We must make it count.

Our advantage is that most people around us are preoccupied.  They are in shock.  Or they are in a frenzy of activity and distracted by the chaos of our moment.  In any case they are too concerned with the present to care much about the future.

So we must make it ours.

Beginning now.

PROLOGUE

Really existing democracy — that is a form of democracy that is built by action and not simply words — is a method of distribution.  It focuses intensely on the way in which our collective resources are shared.  It asks questions of those in power.  It demands that they share.  Not necessarily equally.  But more equally.  Fairly.  

This form of democracy has not existed in America for a long time.  Perhaps as long as forty or fifty years.

The historic problem that prevented democracy from being acceptable throughout the ages was that, in simple terms, rich people do not like sharing.  Far from it.  This is hardly a novel observation, but it is crucial.  We have embellished our political thinking with all sorts of intellectual finery.  There is a long and noble tradition of discussion, debate, and consideration.  Such finery is a distraction though, for the issue at hand can always be resolved down to that simple truth: rich people do not like sharing.

Instead they will contrive all sorts of ideas and theories to justify their special access to wealth, and they will defend that access ferociously. 

History is clear they have been remarkably successful.  For millennia they have constructed defensive moats around their privileges.  They have dug them both deep and wide.  They have regaled themselves with self-invested virtues that gleam in the surrounding gloom.  They have very carefully reduced the ground around them to a very low level.  They have flattened it the better to control and exploit it.  They oppress in order to flourish.  It is a timeless and ongoing process.  It has a permanence that belies theories that suggest otherwise.  The goal is control.  The target is asymmetry in distribution.  It is acquisitive.  And it stands on the recognition of the equivalence of wealth and power.  Those with power are those with wealth.  Those with wealth are those with power.  Or, to adapt somewhat to Jonathan Levy’s version: the history of profit is the history of power.

This simplicity cuts through all the fanciful theorizing produced during our eons of political discussion.

It is a simplicity that generations of royalty, aristocracy, religious orders, military groups, business leadership and other oppressive elites have understood.   They know to viscerally.  Their privilege rests precariously on their ability to justify their own existence.  Brute force will do.  So will endless elegant intellectual discourse.  As long as the distribution is suitable biased, the rich will shift and bend accordingly.  What they will not do is share.

And it is because of such simplicity that really existing democracy must also be simple.  Clarity is essential.  The rich must be forced to share.  The power of the elite must be met by force.  Really existing democracy exists only within the context of ongoing — permanent — conflict.  When we stop fighting, we begin losing.

When we settle into complacency and reduce our threat we begin our retreat towards the unequal domination by the rich of the long millennia before democracy.  Therefore, constant vigilance is a necessary condition for the maintenance of really existing democracy.  

OUR MOMENT

There are two tropes presently extant in our political discussion: 

One is that the world is about to brighten as we eliminate layers of government waste, left wing zealotry about genders and so on, and as we extricate America from the burden of its exploitation by nefarious trading partners or free-riding erstwhile allies.  That is making America great again.

The second is that the world is ending and that American values are being trampled underfoot as a heathen and undereducated dictator fastens his grip on the levers of power to stifle democracy and toss the nation back into some foggy and dangerous version os a distant past.  The 1890s is the most popular guess for our destination.  Imperial and almost fascist this America is unrecognizable when viewed through the complacent rosy lens of recent decades.

Neither are correct.

The reality is far more complex and takes some explanation.  Here’s my attempt.  Yes, I know, it’s one of many.

First,  As I have tried to explain before: American democracy has been in a state of disrepair for decades.  Really existing democracy (RED?) is a very basic concept.  It is the struggle for a fair distribution of the collective fruits of our industry.  It is thus class conflict.  It is the constant threat of the majority to upend the lifestyles of the governing elite unless they share their riches.  Democracy, viewed in this raw form is easy to understand and is based on a very simple basic principle.  It has none of the fancy trimmings that intellectuals love to lather it with as they indulge in endless clever discussions.  The appeal, to me, of that basic idea is that it explains why we want democracy in the first place.  And it helps, also, explain why democracy is usually both fleeting and fragile.  Rich people don’t like sharing.  They never have.  So they are adept at tricking the masses into obedience in order to preserve their privileges.

And trickery we have had in abundance.

The latest bout began in earnest back in the late 1970s and early 1980s and has been going full throttle ever since.  The Carter/Reagan turn to neoliberalism is the true beginning of the end of democracy in its RED form.  The resurgence of elitist power asserted through the corporate takeover of politics and the heights of the economy is the narrative most often told for this period.  The mechanics of the takeover are well known: the denigration of social action through government, the absurdity of shareholder priority in business, and the steady undoing, or neglect of, the machinery of the New Deal have been discussed endlessly.  They have not, though, been reversed.

Why?

Because we fell for the conflation of liberalism and democracy — we became lazy in mixing the two.  The phrase “liberal democracy” displaced the simpler single word “democracy”.  

Liberalism is a form of politics that denies, or ignores, the need for distributive conflict.  At its heart it is based on the long narrative begun back in the first tremors of freedom during the 1600’s.  And that narrative was one designed to extricate a newly rising mercantile class from the grip of autocratic, religious, and military tradition.  The new class needed space to thrive and saw an opening in the autocrat’s need to finance their various religious wars.  In simple terms: the monarchs needed cash to pay for their armies as they rampaged around Europe and fought over interpretations of Christianity.  The people who had that cash wanted something in return.  What they really wanted was enhanced political status so they could guarantee both the recognition of their ownership of, and then the protection of, their property.  In particular they wanted protection from arbitrary seizure and taxation.  

Since wars over religion had been so exhausting the awakenings of liberalism were also targeted at removing it as something important to the state. No state sponsored religion implied no wars between states on its behalf.   So, religion, henceforth, was to be a personal matter.  Thus began the march towards modern secularism.  But, it was quickly realized that the same resolution applied to property.  After all, more quiet implied less likelihood of the state needing to tax.

So “liberty” was launched into the political conversation as a property based and secular idea.  People were sick of religion as a basis for endless war.  People were frightened of autocrats and armies.  Liberty was an idea that was designed to justify the limitation of the mayhem everyone wanted to escape from.  It was never meant to extend beyond the protection of private property.   This history explains why distribution is not a concept within the liberal realm: liberalism is intensely individual.  Deliberately.  Ideas of distribution do not fall within its ambit.  Indeed, they are hostile to it because issues of distribution are social not individual.

Liberalism, to this day, carries forward its deep roots in property.  It is why our explanations of the economy are mostly based upon things like “free markets” which are the conceptual embodiment of that same 1600s idea.  This is why, when those opposed to the re-emergence of the state as a social force wanted to give themselves a name, they described themselves as “neoliberal”.  Their problem being that the word “liberal’ had been co-opted, so they thought, by the advocates of the very New Deal policies that they saw as abhorrent intrusions into “liberty”.

That the New Dealers and their ilk could also see themselves as liberal was based on a second definition of “liberty” that emerged a century or so after the original propertied version.  This second version was very different.  Indeed in some ways it was contradictory to the first.  It put the emphasis on collective and not private political action.  Its roots were also very different:  it sprang from resistance and opposition to the radical change in lifestyles and standards of living being created by industrialization.  It was not a reaction to autocracy or religion.  It was a reaction to capitalism, which itself was a creation of the first version of liberty.  More particularly, it was a claim for a more fair or equal distribution of the wealth being generated by industrialization.  Central to this sort of liberty was the notion that the cost of the complete overhaul of traditional lifestyles by the onset of industrialization ought be offset somehow by a share in power being given to those affected most: the workers who now found themselves moved wholesale from the land to the factory, and from the countryside to the cities.

I think it is useful to insert at this point a comment on consumption.  The inequality inherent in rampant capitalism — it is a feature of unleashed private enterprise that some will end up with a lot more than others —  resists most powerfully as inequality of wealth not of income.  It is the stock and not the flow that matters.  Why?  Because the Great Enrichment, to use Deidre McCloskey’s phrase, created an abundance of consumable stuff.  So it access to all that stuff that matters.  Equality of consumption, or of access to the goods and services made available by the process of capitalism, is what we are interested in.   Wealth is simply a measure of that access.

It is this second version of liberty that we now call democracy.  It is why democracy is, at its heart, a class based idea and not an individual based idea.  It is an expression of the collective and is meant to deny the ability of any individuals accumulating a disproportionate share of the national wealth.  Democracy is designed from its origins as a mitigant against excessive liberalism.  

In theory the two versions of liberty can co-exist.  But we need constantly to recognize that they are in tension and are very different, with very different purposes and values.  Their conflation into “liberal democracy” is therefore likely to lead us to lose sight of the difference.  Worse, it opens up the opportunity for elite exploitation and the degradation of one or the other.

In our case, as I mentioned above, since the Carter/Reagan turn to neoliberalism the heavy emphasis has been on the individual.  Democracy has been sidelined or forgotten.  The use of the phrase “liberal democracy” has hidden the loss of the latter and the privilege given to the former.

The ease with which democracy was lost speaks to the difficulty in articulating its value in a society that has become complacent in its ongoing ability to generate prosperity for the masses.  The delusion that the collective is unimportant is an easy one to sell when rising standards of living look as if they are a historical fact and not something that needs constant work.  Once the delusion is well established it becomes an easy next step for a rent and asset-hungry elite to establish itself: it can hide behind the veil of protecting the individual against the predations of the state all whilst it builds itself privileges by capturing the operations of the very state it is denigrating.

Trickery indeed.

Critical in the creation of the delusion is to cast the state , not as the engine of collective action and thus the protector of the masses, but as the embodiment of the ancient monarchs and autocrats the the liberals originally fought so hard against.  In this false version the masses can be turned against the very protector they need in order to flourish and benefit from the collective production of wealth.  

It is much to my dismay that the economics profession played a key role in nurturing this delusion.  The version of economics popularized in America since World War II, which some refer to as “Cold War Economics”, is designed to demonize the collective and overemphasize the individual.  It is, consequently, profoundly anti-democratic.  

But how does this all play back into the current chaos roiling America?

That is not as complicated as many observers imagine.

The neoliberal era was simultaneously the era of technocracy.  Our economies had become so complex, with the divisions of labor and knowledge so rife, that its interdependencies produced endless niches for specialist skills.  Lawyers, consultants, academics, accountants and so on proliferated.  The engine of the economy needed this array of specialists scattered within it to connect it and make sense of its complexity.  The problem being that the very presence of specialists added new complexity.  And it alienated its operation from the basic theories we used to describe what was going on.  The surge in numbers of such technocrats during the neoliberal era speaks to the difficulty of keeping the whole together.

It was, perhaps inevitable, that this new class of people would be co-opted by the elite.  So it turned out.  The professional class became the route through which pernicious ideas such as shareholder value were propagated.  The professionals enriched themselves as a reward for doing the bidding of those above them.  They became a barrier between the masses and the more traditional privileged few who have always populated the top of society.

As society was gradually made more liberal and less democratic the economic consequences piled up.  The steady erosion of earning power owned by the masses began to act as a brake on the ability of the whole to keep growing at a pace quick enough to spread prosperity widely throughout society.  The rent seeking of the elite, now unencumbered from the baggage of democracy, and thus without accountability to the masses, also began to slow growth down.  The loss of consumption power caused by the unequal distribution of incomes depressed returns on the assets owned by the elite, who, in response, looked for opportunities overseas.  

Thus dawned the age of outsourcing, foreign investment, and extended supply chains we now know as globalization.  Or rather this latest incarnation of globalization.  And, as during the colonial era in the late 1800s, extensive deployment of capital out of the homeland put pressure on the state to protect it via entangling trade agreements.  The beneficiaries of those agreements were not the masses whose work and wages were affected by the mobility of capital, but the owners of that capital.  This era of globalization produced an even greater inequality within America, even though it reduced inequality globally.  

A more balanced ideology — one that included democracy as well as liberalism — would have made adjustments domestically for the consequences of the steady impact of globalization.  Without democracy, though, such adjustments never rose to an appropriate level.  A radical divergence in domestic opportunity, prosperity, and aspiration arose.  The body politic was deeply divided.  Empathy evaporated.  Hostility increased.  

So a political crisis became inevitable.  

But when the crisis came it was within the economy and a consequence of elite greed and technocratic incompetence.  Elite greed because it had stripped away the guardrails from the financial sector despite its well known volatility.  Incompetence because of the complacency that the technocrats had in their ability to manage what had become the most complex economy in history.  Simple ideas and outdated theories crumbled under the weight of this combination.  The response was even worse: it helped the perpetrators but not the victims.  The absence of democracy was never more acutely experienced.  The elite’s lack of regard for the masses drove home the message of division.  The inadequacy of the economic recovery and its focus on elite interests simply magnified the anger brewing below.  

America has struggled in a polarized state ever since.   As the cost of carrying a rent-seeking class accumulated, and as the loss of a democratic capacity to rein it in gathered, ever more obvious consequences and political reaction was inevitable.

Populism has its roots in this course of events, but to describe our politics as “populist” is to misinterpret events.  We are living through a battle for ascendancy within the elite whose long standing divisions have now burst into the open in a vitriolic and ill tempered fight.  Neither side of the division is truly committed to democracy.  Not, at least in its RED form.  

On the contrary, this is not a battle to re-establish democracy.  It is a struggle to define the post-democratic landscape and to establish one side or the other of the elite as ascendant.

This needs clarifying.

Start with this statement:

“I no longer believe that freedom and democracy are compatible … [the fate of the world] … may depend on the effort of a single person.”

That’s Peter Thiel, one of the world’s richest men defining himself as anti-democracy and steadfastly pro-dictatorship.  He is also someone who pours great amounts of money into America’s political system to tilt elections towards the achievement of his post-democratic vision.

He added the purpose that would motivate that dictator: making the world “safe for capitalism”.

Thiel is a close associate of Elon Musk who shares the same philosophy.  

There could not be a more clear articulation of the goal of that part of the elite.  The oligarchs are unburdened by attachment to democracy.  They see it as I do: a class struggle.  They see it as an infringement on their “right” to amass fortunes unworried by issues of distribution.  In their eyes democracy is an impediment to “freedom” where freedom is defined strictly through the lens of capitalism.  Which makes sense in within the confines of the history of liberty I have given here.  The objective of this self-described “neo-reactionary” movement is to eliminate that part of our history within which the middling and lower classes extracted a more fair distribution of the collective creation of wealth.  For Thiel and his ilk there is no such collective action.  Everything is individual.  With individuality driven towards an such an extreme definition that it excludes any and all social activities.

Including almost all government.  Which is why another acolyte of this philosophy, Steve Bannon, speaks of the massive downsizing of government and the ultimate deconstruction of the “administrative state”. 

In many ways the views held by the likes of Thiel are an echo of those held by America’s first generation of oligarchs.  Obsessed as they were by driving down costs and thus amassing their fortunes that first generation rode roughshod over any resistance ton what they called “improvements” —or,  in our modern language, innovations.  The biggest impediment to the uptake of such improvements was usually the workforce whose lives and livelihoods were constantly threatened by such things.   Thus people like Carnegie fought ferociously to implement cost saving improvements.  Dismantling collective resistance of workers via their unions being a glaring instance of this.  Capitalist oligarchs throughout the modern era have seen it as both their right and duty to impose their improvements on society regardless of the human cost.  

In this vein, whilst Musk and Bannon might throw vile epithets at each other, that is simply a bruising and personal fight for the ear of Trump.  Philosophically they are united in their aim: the destruction of democracy and the installation of authoritarian rule.  Their words and their actions are reactionary.  Their goal is clear.  And they are in power.

The defeated elite faction is that of the now deposed establishment: the neoliberal corporatists.  This faction was also anti-democratic but more subtle in its opposition.  It preferred slow degradation rather than full-on assault.  It harbored sub-groups within it and those sub-groups occasionally fell into what appeared to be ideological conflict.  But that was always an illusion.  Those internal arguments were expressed in relatively minor ways and the threat of democracy was always sufficient to unify and overcome such arguments rising towards a total split within the faction.

Neoliberalism, as we all know, was designed to re-assert the power and status of the old wealthy and corporate elite against the policies of the New Deal.  It was enormously successful and managed to degrade New Deal democracy to such an extent that the inequality it sought roared back to life over the past few decades.

But excessive inequality is ultimately self-limiting.  The over concentration of wealth starves the economy of shared consumption and over inflates the store of financial assets.  That combination always produces instability.  Left unattended and deregulated such instability slides into crisis.  So it happened in 2008, leaving the credibility of the neoliberal faction of the elite reduced in status and with its competence in deep disregard.

This disrepute has haunted the establishment elite ever since.  Exposed as deeply incompetent it has struggled to justify its presence ever since.  Its inability or unwillingness to include the masses in the rescue efforts post-2008 undermined its most significant claim to power:  despite its antipathy toward democracy it had presented itself as technocratically capable of generating wealth.  It was professional.  It was credentialed.  Its leadership hailed from the best schools.  It could be trusted to enrich the nation, even if it began to extract excessively for itself.  

Its failure and then collapse in the face of the popular realization of its incompetence set in motion the struggle for supremacy we are witnessing at present.

That struggle is for the definition and control of the post-neoliberal world.  Both the neoliberals and the neo-reactionaries share a deep demonstrated disrespect for democracy.  That much is certain.  Both also share a determined attachment to capitalism, which is, after all, the engine that permits them to establish and protect their rents.   

So, from the perspective of someone committed to democracy, we can expect neither faction, despite their constant appeal to the masses for the necessary votes in elections, to repair the damage that produced the anger and frustration accumulated since 2008.  So neither popularly espoused explanation for our future holds water.  We are not in the midst of a battle to defend or recover democracy.  That is long lost.  We are, instead witnessing a duel within our fractured elite.  It is a civil war.  The protagonists are elitists.  The result will be to the advantage of the rich.  Right now the oligarchs are winning.  Authoritarianism looks as if it will displace liberal democracy.

Which, as I have argued, was never democracy anyway.