I have just read an interesting article on neoliberalism in Europe that
calls for restoring or regaining democratic debate at the national
level in European countries. I will cite paragraphs from the article,
written by William Mitchell and Thomas Fazi, which came out today in
Social Europe: "Everything You Know About Neoliberalism Is Wrong." Although I do not like the title of the article, I like the text.
"Even though neoliberalism as an ideology springs from a desire to curtail the state’s role, neoliberalism as a political-economic reality has produced increasingly powerful, interventionist and ever-reaching – even authoritarian – state apparatuses.
The process of neoliberalisation has entailed extensive and permanent state intervention, including: the liberalisation of goods and capital markets; the privatisation of resources and social services; the deregulation of business, and financial markets in particular; the reduction of workers’ rights (first and foremost, the right to collective bargaining) and more in general the repression of labour activism; the lowering of taxes on wealth and capital, at the expense of the middle and working classes; the slashing of social programmes, and so on. These policies were systemically pursued throughout the West (and imposed on developing countries) with unprecedented determination, and with the support of all the major international institutions and political parties.
(...) Conventional wisdom holds that globalisation and the internationalisation of finance have ended the era of nation states and their capacity to pursue policies not in accord with the diktats of global capital. But does the evidence support the assertion that national sovereignty has truly reached the end of its days? (...)
More in general, as we explain in our new book Reclaiming the State: A Progressive Vision of Sovereignty for a Post- Neoliberal World, globalisation, even in its neoliberal form, was (is) not the result of some intrinsic capitalist or technology-driven dynamic that inevitably entails a reduction of state power, as is often claimed. On the contrary, it was (is) a process that was (is) actively shaped and promoted by states. All the elements that we associate with neoliberal globalisation – delocalisation, deindustrialisation, the free movement of goods and capital, etc. – were (are), in most cases, the result of choices made by governments.
(...) [there was] a deliberate and conscious limitation of state sovereign rights by national elites, through a process known as depoliticisation. The various policies adopted by Western governments to this end include: (i) reducing the power of parliaments vis-à-vis that of the executive and making the former increasingly less representative (for instance by moving from proportional parliamentary systems to majoritarian ones); (ii) making central banks formally independent of governments; (iii) adopting ‘inflation targeting’ – an approach which stresses low inflation as the primary objective of monetary policy, to the exclusion of other policy objectives, such as full employment – as the dominant approach to central bank policymaking; (iv) adopting rules-bound policies – on public spending, debt as a proportion of GDP, competition, etc. – thereby limiting what politicians can do at the behest of their electorates; (v) subordinating spending departments to treasury control; (vi) re-adopting fixed exchange rates systems, such as the euro, which severely limit the ability of governments to exercise control over economic policy; (vii) limiting the capacity of governments to regulate in the public interest, by means of so-called ISDS (investor-state dispute settlement) mechanisms, nowadays included in most bilateral investment treaties (of which there are more than 4,000 in operation) and regional trade agreements (such as the FTAA and TPP); and, most importantly perhaps, (viii) surrendering national prerogatives to supranational institutions and super-state bureaucracies such as the EU.
(...) the creation of self-imposed ‘external constraints’ allowed national politicians to reduce the political costs of the neoliberal transition – which clearly involved unpopular policies – by ‘scapegoating’ institutionalised rules and ‘independent’ or international institutions, which in turn were presented as an inevitable outcome of the new, harsh realities of globalisation, thus insulating macroeconomic policies from popular contestation. The war on sovereignty has been in essence a war on democracy. This process was brought to its most extreme conclusions in Western Europe, where the Maastricht Treaty (1992) embedded neoliberalism into the EU’s very fabric, effectively outlawing the ‘Keynesian’ polices that had been commonplace in the previous decades.
(...) for more democratic control over politics (and particularly over the destructive global flows unleashed by neoliberalism), which necessarily can only be exercised at the national level, in the absence of effective supranational mechanisms of representation. The EU is obviously no exception: in fact, it is (correctly) seen by many as the embodiment of technocratic rule and elite estrangement from the masses, as demonstrated by the Brexit vote and the widespread euroscepticism engulfing the continent. In this sense, as we argue in the book, leftists should not see Brexit – and more in general the current crisis of the EU and monetary union – as a cause for despair, but rather as a unique opportunity to embrace (once again) a progressive, emancipatory vision of national sovereignty, to reject the EU’s neoliberal straitjacket and to implement a true democratic-socialist platform (which would be impossible within the EU, let alone within the eurozone). To do this, however, they must come to terms with the fact that the sovereign state, far from being helpless, still contains the resources for democratic control of a nation’s economy and finances – that the struggle for national sovereignty is ultimately a struggle for democracy. This needn’t come at the expense of European cooperation. On the contrary, by allowing governments to maximise the well-being of their citizens, it could and should provide the basis for a renewed European project, based on multilateral cooperation between sovereign states.
William
Mitchell and Thomas Fazi are the authors of Reclaiming the State: A Progressive Vision of Sovereignty for a Post- Neoliberal World, which
has just been published by Pluto Press.
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| Thomas Fazi |
The process of neoliberalisation has entailed extensive and permanent state intervention, including: the liberalisation of goods and capital markets; the privatisation of resources and social services; the deregulation of business, and financial markets in particular; the reduction of workers’ rights (first and foremost, the right to collective bargaining) and more in general the repression of labour activism; the lowering of taxes on wealth and capital, at the expense of the middle and working classes; the slashing of social programmes, and so on. These policies were systemically pursued throughout the West (and imposed on developing countries) with unprecedented determination, and with the support of all the major international institutions and political parties.
(...) Conventional wisdom holds that globalisation and the internationalisation of finance have ended the era of nation states and their capacity to pursue policies not in accord with the diktats of global capital. But does the evidence support the assertion that national sovereignty has truly reached the end of its days? (...)
More in general, as we explain in our new book Reclaiming the State: A Progressive Vision of Sovereignty for a Post- Neoliberal World, globalisation, even in its neoliberal form, was (is) not the result of some intrinsic capitalist or technology-driven dynamic that inevitably entails a reduction of state power, as is often claimed. On the contrary, it was (is) a process that was (is) actively shaped and promoted by states. All the elements that we associate with neoliberal globalisation – delocalisation, deindustrialisation, the free movement of goods and capital, etc. – were (are), in most cases, the result of choices made by governments.
(...) [there was] a deliberate and conscious limitation of state sovereign rights by national elites, through a process known as depoliticisation. The various policies adopted by Western governments to this end include: (i) reducing the power of parliaments vis-à-vis that of the executive and making the former increasingly less representative (for instance by moving from proportional parliamentary systems to majoritarian ones); (ii) making central banks formally independent of governments; (iii) adopting ‘inflation targeting’ – an approach which stresses low inflation as the primary objective of monetary policy, to the exclusion of other policy objectives, such as full employment – as the dominant approach to central bank policymaking; (iv) adopting rules-bound policies – on public spending, debt as a proportion of GDP, competition, etc. – thereby limiting what politicians can do at the behest of their electorates; (v) subordinating spending departments to treasury control; (vi) re-adopting fixed exchange rates systems, such as the euro, which severely limit the ability of governments to exercise control over economic policy; (vii) limiting the capacity of governments to regulate in the public interest, by means of so-called ISDS (investor-state dispute settlement) mechanisms, nowadays included in most bilateral investment treaties (of which there are more than 4,000 in operation) and regional trade agreements (such as the FTAA and TPP); and, most importantly perhaps, (viii) surrendering national prerogatives to supranational institutions and super-state bureaucracies such as the EU.
(...) the creation of self-imposed ‘external constraints’ allowed national politicians to reduce the political costs of the neoliberal transition – which clearly involved unpopular policies – by ‘scapegoating’ institutionalised rules and ‘independent’ or international institutions, which in turn were presented as an inevitable outcome of the new, harsh realities of globalisation, thus insulating macroeconomic policies from popular contestation. The war on sovereignty has been in essence a war on democracy. This process was brought to its most extreme conclusions in Western Europe, where the Maastricht Treaty (1992) embedded neoliberalism into the EU’s very fabric, effectively outlawing the ‘Keynesian’ polices that had been commonplace in the previous decades.
(...) for more democratic control over politics (and particularly over the destructive global flows unleashed by neoliberalism), which necessarily can only be exercised at the national level, in the absence of effective supranational mechanisms of representation. The EU is obviously no exception: in fact, it is (correctly) seen by many as the embodiment of technocratic rule and elite estrangement from the masses, as demonstrated by the Brexit vote and the widespread euroscepticism engulfing the continent. In this sense, as we argue in the book, leftists should not see Brexit – and more in general the current crisis of the EU and monetary union – as a cause for despair, but rather as a unique opportunity to embrace (once again) a progressive, emancipatory vision of national sovereignty, to reject the EU’s neoliberal straitjacket and to implement a true democratic-socialist platform (which would be impossible within the EU, let alone within the eurozone). To do this, however, they must come to terms with the fact that the sovereign state, far from being helpless, still contains the resources for democratic control of a nation’s economy and finances – that the struggle for national sovereignty is ultimately a struggle for democracy. This needn’t come at the expense of European cooperation. On the contrary, by allowing governments to maximise the well-being of their citizens, it could and should provide the basis for a renewed European project, based on multilateral cooperation between sovereign states.
About William Mitchell and Thomas Fazi
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| William Mitchell |
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