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A rising authoritarian wave

The de-regulation of financial capital threatens to bring us back to capitalist authoritarianism that flourished in the 1920s and 1930s. But this time it gathers strength with no strong popular movement in the United States or any European country to challenge it.

As the one hundredth anniversary of the beginning of World War I approaches, one may encounter some rather strained attempts to compare the current global balance of forces to that in Europe in 1914. I recently visited several countries in south east Asia and a different comparison struck me, the similarities between now and the 1930s, weak democracies and strong dictatorships.

This comparison “jumped off the page” after a week in Bangkok, followed by several days in Hanoi - a journey from a country with weak and faltering formal democratic institutions to an apparently stable one with an authoritarian regime (bordering on a country with a considerably more brutal dictatorship, China).

In The Age of Extremes, Eric Hobsbawm argued that the conflict between capitalism and communism determined the course of the twentieth century.  This confrontation of socio-economic ideologies without doubt dominated European and global history, especially after 1945.  But another, inter-related confrontation that determined the course of the century was authoritarianism versus democracy. The capitalism-communism conflict seems but a moment of history for people in their forties and younger. However, the danger of a rising authoritarian wave is as imminent in the twenty-first century as it was in the twentieth.

In most countries of Europe in the 1930s the contest between authoritarian and democratic visions of society dominated the political struggle. The exceptions were Italy where the fascists had already established an extreme version of authoritarian rule, and Britain where a rigid class structure gave stability to superficially democratic institutions. By the middle of the decade, capitalist authoritarian regimes were clearly on the rise in Germany and much of central and eastern Europe (e.g., Hungary and Poland), as well as Portugal, with Spain soon to join the anti-democratic camp.

Indeed, in very few of the industrialised countries in the late 1930s did democracy seem the stronger trend. Among the large countries only in the United States was there an unambiguous shift towards strengthening popular participation. Ironically enough it was during the presidency of patrician Franklin D Roosevelt that trade unions asserted themselves as a major political force (which would not survive much past mid-century).

Now, well into the twenty-first century it is even more difficult to find a major country with vigorous and democratic institutions, certainly not in the United States nor in Europe. In the United States the confrontation between a well-funded right wing Republican Party and the middle-of-the road Democrat Party dominates politics, one doctrinaire and aggressive, the other muddled and vascillating. The anti-democratic trend is demonstrated by passage of laws restricting the right to vote in Republican controlled states, linked to the racist xenophobia of the Tea Party. In the White House sits a Democrat apparently unconcerned by a massively intrusive national security complex.

In Europe anti-democratic trends are if anything stronger. Britain probably has the most extensive video surveillance network in Europe (see recent articles in the Guardian), as well as legal restrictions on the right of assembly, designed to reduce public protests (as we find in Spain). In addition, the Conservative-dominated coalition government’s brutal attack on poor households receiving social support in effect legalises civil rights violations. Surveillance, attacks on the poor and the government fanning fears of immigrants combine to make a potent anti-democratic package.

On the continent pre-existing authoritarian tendencies enjoyed a quantum leap under the EU-wide austerity regime fostered by the German government under the cover of the European Commission. The unelected governments in Greece (2011-12) and Italy (2011-13) represent the most obvious and shocking examples of the authoritarian trend.  Much more serious in the long term is the EU fiscal compact (officially named the Treaty on Stability, Coordination and Governance in the Economic and Monetary Union).

This treaty, which came into effect at the beginning of 2013, severely limits the authority of national parliaments to set fiscal policy. The treaty and additional measures demanded by the German government remove fiscal policy from public control (with monetary policy in the hands of the European Central Bank and beyond national accountability). This process in which major decisions are taken away from the electorate fundamentally undermines public faith in the democratic process. The rise of neo-fascist groups with an extra-parliamentary agenda, such as the New Dawn in Greece, comes as no surprise.

Almost exactly a year ago, Peer Steinbrueck, then the German Social Democratic Party's candidate for chancellor, spoke at the German embassy in London. In his speech he proposed that the European Commission should have the power to veto national budgets if they exceed the guidelines of the fiscal pack.  I suggested during questions that such a veto would violate the principle that the governed should be able to hold their governments accountable.  He replied that fiscal stability required countries to surrender some of their sovereignty. In other words, the goal of “fiscal stability” requires the citizens of Europe to surrender their basic democratic right to hold a government responsible for its economic policies.

The authoritarian trend in the United States and Europe is obvious. What is its source in these countries? In the 1920s and 1930s the rise of authoritarian regimes followed the widespread public perception that unregulated capitalism resulted in spectacular disasters. These disasters included the most catastrophic war in human history, soon followed by the most devastating economic crisis the world had ever known. Many on both the left and the right judged “bourgeois democracy” as degenerate and dysfunctional. In Russia the rejection of capitalism took the form of an attempt to create a governance system in the interests of the working class and peasantry. The hope for popular democracy quickly collapsed as the putative workers’ state transformed into thinly disguised authoritarian rule.

Far worse, in Italy and Germany the discrediting of liberal capitalism led to unabashed dictatorships that made no pretence of their authoritarian nature. The business elites constructed these fascist regimes to maintain the rule of capital in the face of powerful labour movements. The regimes proved appallingly successful not only in crushing the labour movement but in rolling back the principles of the Enlightenment. Destruction of these savage regimes required a war even more catastrophic than the 1914-18 conflict.

The current authoritarian tide in European and the United States also comes from the business elites, but is in this case driven by the ideology of neoliberalism not fascism (see “Democracy against Neo-liberalism: Paradoxes, Limitations, Transcendence,”  by Alfredo Saad Filho and Alison J Ayers, forthcoming in Critical Sociology).  Neoliberalism pretentiously claims to be the guarantor of freedom – “free markets, free men” was the title of Milton Friedman's infamous London lecture to adoring businessmen in 1974. Reality is quite the contrary. The neoliberal inspired market deregulation over the last 30 years has been the destroyer of freedom. The most obvious mechanism by which this destruction occurs is the weakening of the power of trade unions and other popular organisations. Parallel to that weakening has been the rise and consolidation of the power of the financial capital to control the media, political debate and elections themselves.

Writing in 1947 in the foremost economic journal of the time, The Economic Journal, the British economist K. W. Rothschild succinctly summarised the consequences of unregulated capitalism,

…[W]hen we enter the field of rivalry between [corporate] giants, the traditional separation of the political from the economic can no longer be maintained… Fascism…has been largely brought into power by this very struggle in an attempt of the most powerful oligopolists to strengthen, through political action, their position in the labour market and vis-à-vis their smaller competitors, and finally to strike out in order to change the world market situation in their favour.

The de-regulation of financial capital threatens to bring us back to capitalist authoritarianism that flourished in the 1920s and 1930s. But this time it gathers strength with no strong popular movement in the United States or any European country to challenge it. The absence of a movement with the strength to challenge the power of unregulated capital, plus a mainstream media supportive of neoliberalism make openDemocracy and other progressive news platforms essential to the anti-authoritarian struggle. 

An alternative version of this article is published on Insightweb.

About the author

John Weeks is Professor Emeritus, School of Oriental & African Studies, University of London, and author of 'Economics of the 1%: How mainstream economics serves the rich, obscures reality and distorts policy', Anthem Press, published earlier this year.



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