Jihad vs. McWorld - Benjamin R. Barber [135]
Serious students of the market who distinguish between totalitarian collectivism and the democratic search for common goods will want to dispute these quasi-anarchist libertarian dogmas.4 Notwithstanding the renewed popularity of the laissez-faire creed in England and America over the last few decades, amplified by a deeply felt repugnance for politics and politicians, there is a long and respectable tradition that is neither collectivist nor even welfare statist that disputes the putative sufficiency of markets and challenges their vaunted capacity for economic self-regulation.5 Contemporary critics like Andrew Bard Schmookler and Robert Kuttner are fierce critics of the social costs of applied laissez-faire policies in the Reagan-Thatcher era, but not even Adam Smith thought the market could do everything.6
Market relations are simply not a surrogate for social relations, let alone for democratic social relations, and it is only the zealous proponents of capitalism in its extreme laissez-faire version (what Robert Kuttner calls its utopian incarnation) who pretend otherwise. Although there is a discernible historical correlation between democracy and capitalism, it is democracy that produced capitalism rather than the other way round. A seventeenth-century mercantilist England was in the course of the eighteenth century democratized; only in the nineteenth century did a democratized England embark on policies of full-scale industrialization, free trade (the revocation of the Corn Laws in 1846), and economic empire. To this day, the economies of capitalist nations depend on activist democratic governments, which not only play a vital countervailing role in checking market excesses and attending to common and civic values in which capitalism quite properly has no interest, but which continue to nurture markets as well. The most successful “capitalist” states with well-advertised miracle economies have in truth laced their markets with a thin but sinewy mercantilism.
Under cover of their post—World War II “free market” revolutions, both Japan and Germany actually pursued aggressive national economic policies. Franklin Delano Roosevelt’s New Deal did as much to save capitalism from self-annihilation as it did to save the American people from capitalism’s social ruthlessness. Neither Reagan’s America nor Thatcher’s England could have pursued the illusion of a return to pure laissez-faire without all of the benefits of several generations of an interventionist government and a mixed economy (as Reagan learned when he toyed briefly with a revision of the Social Security system). Truly free economies in this century have always been mixed economies in which democratic governments have balanced the interests of economic utility and social justice. Norman Birnbaum portrays the West German economy of the economic miracle as, in actuality, a market “inextricably bound to the state. Subsidies and tax incentives, a substantial public sector, considerable state support for research, a large state role in occupational training, the provision of export credits, were coordinated elements of national economic policy. The major private banks … the government and the Federal Bank worked together…. [Much of all of this was merely] a continuation of welfare state traditions modernized by Bismarck.”7
What was true for the Germans, was true for all of the successful postwar capitalist nations. For they understood well enough that a pure laissez-faire economy quickly breaks and then self-destructs along the fissures