Today one of the major challenges to liberal democracy arises out of the turn taken by liberal economies since the late 1970s. Defined as a form of government that combines the election of the rulers by the ruled with effective guarantees for the liberties of all, liberal democracy is eroded by transformations changing the very type of economy that is frequently considered its natural counterpart or historic birthplace.
The traditional challenges to democratic government such as authoritarian and totalitarian projects today appear rather distinctly as corollaries of economic liberalism as it has been redefined over the past decades. Crucially, the increasingly frenetic search for ever greater efficiency, productivity and competitiveness that dominates the agendas of policy makers around the world has given rise to growing restrictions on liberties and the erosion of democratic government where it still exists. Simultaneously, the glorification in words and deeds of competitiveness has isolated individuals into lonely sole bowlers tempted to compensate for the collapse of society and community with exclusivist communalist, authoritarian and even totalitarian ideologies and practices.
In economically more and less advanced countries alike the emphasis on efficiency to maintain an existing competitive edge or to catch up with more successful competitors increasingly strengthens top-down decision making mechanisms. Allegedly calling for quick decisions, finance-, skill- and head- hunting has much enhanced the appeal of individual or elite ‘leadership’ to the detriment of collective participatory mechanisms to determine common courses of action. Controversial debates in public and in dedicated fora such as parliaments, assemblies and related committees are becoming more and more irrelevant for devising public policies, regulating politics and even transforming polities. Consultation consequently involves mainly selected actors. Either in order to co-opt them or simply to make use of their technical abilities to fine tune and sell policies they support anyway. Chosen and operating in obscure ways, these actors represent special rather than competing interests and therefore restrict rather than broaden participation. Polemically speaking, politics is being replaced by fiat. Rephrased in academically more correct terms, politics is being replaced by government while citizens are reduced to subjects. Government itself increasingly resembles a governance device rather than a collective body representing the polity at large or at least a majority .
Even more than collective decision making processes checks and balances have come to be considered places of friction that slow down change rather than improve outcomes. These decision making processes include features such as bicameralism, co-decision mechanisms between central and local government or the judicial review of executive decisions and legislation. Similar to participatory procedures, checks and balances enable opponents to voice their demands and possibly affect or inflect policies conceived by the ‘leaders’. They are levers that can be used by those who are insufficiently convinced by policy choices, including of course choices based on the dominant ideology of competitiveness. Weakening and abolishing checks and balances, of course, favours the rapid implementation of ill conceived decisions, not least because it disempowers opponents.
Already the academic literature that accompanied macroeconomic stabilization and structural adjustment policies in the 1980s and 90s repeatedly referred to the need to insulate economic decision making from society. Demands and pressures emanating from ‘below’ could only obviate and derail policies whose ultimate wisdom the ruled could not understand. In particular, the nuisance power of the losers of economic reforms had to be reigned in. Too frequently they refused to understand that they suffered for the common good, or that their allegedly temporary sufferings would be rewarded by future benefits.
As the governments concerned and their international backers considered the reforms as non negotiable, demands from society were ultra vires by definition and could only be contained or repressed. The effective insulation of policy making from society naturally involved the marginalization, weakening and destruction of organizations like trade unions that might relay demands from society or even constitute a counter power to the policy makers. It also involved neutralizing or abolishing formal and informal checks and balances which might have protected organizations representing the losers or opened up breaches in the fire wall surrounding policy makers .
Twenty years later, the struggle to permanently increase productivity has become more conspicuous. Efficiency becomes the contemporary avatar of the canons and fortifications at the centre of Mark Twain’s ironic novel even more than the old fashioned arms races involving ever more deadly fighter aircraft and ground to air missiles. Efficiency and competitiveness is the only game in town, not only in the ‘developed’ but also in the ‘developing’ countries.
As Wendy Brown, followed by Myriam Revault d’Allonnes, aptly put it with reference to Michel Foucault, neoliberalism as preached and practised today is quite different from ‘traditional’ liberalism as it was defined and lived by its classics and their followers. While the latter sought to regulate existing ‘natural’ markets, neoliberalism as a ‘constructivist’ approach attempts to build and strengthen markets in the economy and beyond. Thus competition and competitiveness are generalized as the gold standard by which to measure all human activity including the performance of governments .
Export subsidies, trade tariffs, tax holidays to attract foreign capital and active -yet selective- immigration policies targeting specific skill groups like IT technicians are only some of the measures by which governments attempt to enhance the competitiveness of their respective countries. Relevant international regimes such as the WTO or the European Neighbourhood Policy serve similar purposes, obviously within the limits of the balances of power they reflect at given points in time. Without claiming all wealth increases are zero-sum, there are clearly some effects that potentially threaten other individuals, groups or ‘nations’. The competition for competitiveness naturally appears to many players as a matter of life and death, domination and submission (Zygmunt Baumant describes this eloquently in Wasted Lives: Modernity and Its Outcasts ).
Above and beyond the allegedly new manufactured risks that are part of modernisation, at the origin of a ‘risk society’ and indivisible from Ulrich Beck’s ‘second modernity’, the enlightenment that we continue to value highly may once again produce its complete opposite. After giving birth to the tyrannies of fascism and feeding the stultifying mass media that are at the centre of Theodor W. Adorno’s and Max Horkheimer’s ‘Dialectics of the Enlightenment’, its dynamics may now push us for good into the new social Darwinian logic of unbridled market competition.
Fuelled by existential fears, the search for efficiency is becoming the chief, if not sole, guiding principle for human action and public policies. Unchecked by competing concerns such as equity or compassion, it is becoming a totalitarian principle threatening the survival of pluralism, democracy and human rights. A totalitarian principle does not ipso facto entail totalitarian government in the traditional sense. However, by definition it entails the removal of the various sources of friction or opposition and thus the checks and balances that might prevent or delay its own translation into reality .
Though less acute yet, the danger was already recognised at an earlier stage by Marcuse who, in his One-Dimensional Man, wrote:
The apparatus imposes its economic and political requirements for defence and expansion on labour time and free time, on the material and intellectual culture. By virtue of the way it has organised its technological base, contemporary industrial society tends to be totalitarian. For ‘totalitarian’ is not only a terroristic political coordination of society, but also a non-terroristic economic-technical coordination which operates through the manipulation of needs and vested interests. It does preclude the emergence of an effective opposition against the whole. Not only a specific form of government or party makes for totalitarianism, but also a specific system of production and distribution .
While Marcuse thought that the rule of one-dimensionalism would simply empty the meaning of existing checks and balances, they are now openly threatened with dismemberment and disappearance. Where and when they do disappear, the individual, ipso facto deprived of his or her citizen status, enters the desert space produced by tyranny and finds her or himself entirely crushed by terror .
In a sense, the erosion of checks and balances defined as arrangements of powers and counterpowers able to balance and limit each other is implicit in Wendy Brown’s observation. ‘[N]eo-liberal governmentality undermines the relative autonomy of certain institutions from one another and from the market – law, elections, the police, the public sphere – an independence that formerly sustained an interval and a tension between a capitalist political economy and a liberal democratic political system’ . However, rather than a detail, politically the erosion of checks and balances is the crux of the growing subordination of all spheres of life to the ‘economic’ rationality of markets and competitiveness. The weakening or disappearance of institutions is more than a blow to pluralism and diversity. In cases such as those mentioned above, it is a blow to the very essence of liberal democratic government as defined as majority rule mitigated by guarantees for whoever at specific points in time is not part of that majority. Such guarantees will always be premised on counterpowers able to enforce them.
In the ‘developed’ North and more particularly in Europe, the search for growing economic efficiency and competitiveness has prompted a number of restrictions on positive and negative liberties  at least since the beginning of the Thatcherite ‘revolution’ in the United Kingdom. From the outset, the conservative government under Margaret Thatcher took on intermediary powers like trade unions or local councils. Considered as obstacles to the efficiency driven reorganization of the economy and its political underpinnings, they were depicted as the representatives of privileged special interests. Their legitimacy was further undermined by the claim that there were individuals but that there was no society. In numerous policy areas elected local councils lost their powers to newly-created unelected quasi-non-governmental organisations (quangos), run by obscurely-appointed management specialists. Similarly, successive Conservative and New Labour governments created new unelected bodies empowered to assess the performance of universities and allocate funding to institutions of higher education and research. In the days of New Labour, even the Cabinet itself, defined as the one government committee comprising all (senior) ministers, was marginalised by ad-hoc committees convened by the prime minister, sometimes it seems as secretive in their deliberations as selective in their composition .
In Germany, more recently, federalism has been blamed for delays in decision making that allegedly affect economic performance and the efficiency of policies supposed to strengthen it. Key economic reform legislation has to be approved by both houses of parliament, the directly elected lower house (Bundestag) and the indirectly elected upper house (Bundesrat). Representing the various states (Laender), the latter not only allows sub-national interests to express themselves but it is also frequently dominated by a political majority different from that of the lower house and the federal government. Recent constitutional reforms have partly disentangled federal from state responsibilities and thereby limited the powers of co-decision that the states hold at federal level through their joint control of the upper house. Yet, the merits of vertical separation of powers continue to be challenged by the continuous search for immediate efficiency as manifested in more far reaching proposals to centralize decision making powers .
More generally, it is worth noting that throughout Europe the much-celebrated devolution of centrally-exercised powers to regional governments hardly ever entails new federal structures. Put differently, the decentralisation and indeed separation of responsibilities is not accompanied by mechanisms of co-decision in which the new regional entities are represented at the central level. Neither the governments nor separately elected representatives of these regions are sitting in upper houses of parliament, nor any other decision-making bodies concerned with the country at large. Decentralisation, regionalisation, devolution and similar such partial transfers of power to regional governments and assemblies therefore fail to strengthen vertical checks and balances. In accordance with the preferences of the respective centre, they are no more than transfers of secondary issues to secondary powers, supposed to free up central energies for more important issues. Spain, France, the UK and Italy illustrate the absence of new co-decision arrangements; only Belgium defies the trend .
Institutions dedicated to research and learning are other sites where checks and balances are eroded and removed. By now most European governments pride themselves of enhancing the independence and autonomy of their universities. Partly supposed to flow from non-governmental sources of funding including fees, donations and contracts, such autonomy is also supposed to be strengthened by increasingly unaccountable university managers. Elected internal committees lose decision-making powers to vice-chancellors, presidents, deans or even chief executives. In some universities ‘management’ is able to overrule search committees and to appoint professors outside normal appointment procedures. Curiously, the new university bosses gain relatively little autonomy vis-à-vis the regulatory authorities, with the main difference, though, that these now comprise both state and market. Even where direct hierarchical links with the state bureaucracy are scrapped (although they frequently persist in new forms), the subjection of universities to the laws of the market in terms of student recruitment and research funding pushes them to withdraw into status quo promoting docility. University autonomy thus boils down to the autonomy of university bosses and their kitchen cabinets vis-à-vis the academic and wider university community. Increasingly deprived of tenure and therefore of the independence from pressures that alone guarantees academic freedom, academic staff itself is disciplined by the market, be it by avoiding sensitive choices or paying dearly for making such choices.
The efficiency-determined erosion of checks and balances is amplified by the explicit subordination of public policies and decisions to cost-benefit analyses . Universities are supposed to be profitable, and so are hospitals. In the UK, older and more experienced faculty members are eased out to recruit younger, less expensive teaching staff. To balance the university budget, entrance requirements for students are lowered. Higher-fee paying overseas students are offered places more easily than lower-fee paying British and European students. Curricula are adapted to student preferences: social sciences without theory, to be followed perhaps by medical schools free of blood stains. Departments that want to maintain standards lose out in student numbers and thus in fees. They are pauperised within the university and ultimately closed down by the university bosses trained in accountancy rather than the humanities or the sciences. German university professors now receive performance-related pay, largely linked to their capacity to raise funds for research. By implication they raise part of their own salaries from sources that fund certain types of projects but not others. Academic freedom has fallen by the wayside.
Following the Thatcher-inspired reforms, health provision in the UK was sometimes premised on the vicissitudes of the hospital budget. In France recent draft legislation introduces cost targets, for the first time in the country’s history, establishes cost targets for cases brought by public prosecutors. When the investigation becomes too expensive, prosecutors may have no choice but to drop the case, or seek a conviction on shaky grounds. Everywhere education, health and justice are sacrificed to immediate competitiveness as the benchmark for the activities of individuals reduced to the condition of hamsters running in wheels. Increasingly these policies are devised at the ‘top’, with minimal input from ‘below’. They are drafted by or with the help of hand-picked experts able to offer adequate and palatable solutions within the ‘objective’ constraints flowing from regulatory or chaos regimes that are increasingly shaped by competitiveness as the key component of globalisation .
In the global South similar dynamics are at work, even though the overall economic and political conditions often differ radically from those prevailing in the North. In the many countries governed by authoritarian regimes of different types politically relevant liberties and the mechanisms meant to guarantee them such as checks and balances remain weak, fragile and nominal at best. Sometimes like in Egypt or Syria corporatist arrangements offer a semblance of intermediate powers and checks and balances; however, the organizations concerned including trade unions, professional bodies and the like remain largely dominated by the ruling regimes. The same applies to the hyphenated democracies which ultimately boil down to hyphenated forms of authoritarian rule. Frequently the waves of democratization have ebbed out and left back no more than little puddles for democratic animals to swim in. Other places like Saudi Arabia or China had never been touched by these waves in the first place. Finally, a number of countries like Brazil are governed by what may be called the democratic left and at least for the time being make attempts to stem the tide of deliberalization. However, beyond these general differences the negative effects of the search for global competitiveness on liberties and checks and balances is visible. In Egypt, for instance, the government in breach of international covenants actively discourages the creation of trade unions independent of the state dominated unions. It tolerates and encourages practices that keep the growing private sector basically free of unions, even though new labour legislation reduces job security . In Morocco the beginnings of decentralization are neutralized by new sweeping powers given to local governors, themselves appointed by the king. In Lebanon, the largely non-sectarian trade union movement has been undermined by successive governments of entrepreneurs. Based on inward capital flows, they are seeking to further advance redistribution from the bottom to the top through reconstruction of the country.
Clearly, the stakes are higher than the limits that ‘hybrid regimes’ or ‘hyphenated democracies’ impose on political liberties. The question no longer pertains to instances such as the ‘disciplining [of] democracy’ that Abrahamsen noted in African countries where demands for economic reform collide with the interests of political majorities.  At minimum, it pertains to the continued existence of democracy as more than a formalism that at regular intervals offers the ruled a choice among largely identical options, programs and rulers. The subordination of all policies and their choices to one single guiding principle such as competitiveness does not necessarily entail the absence of elections or the presence of one irremovable, inquisitive and intrusive ruler or ruling body. It may accommodate different actors adhering to the same principle who in free elections compete with each other, each of them claiming to be the most efficient implementer of the same overall objective. By implication, it may be compatible with the formal existence of democracy, as of course it is compatible with other political regimes.
However, the subordination of all policies and policy choices to one single guiding principle such as competitiveness subverts and voids the democratic procedure of its democratic substance. Beyond a consensus on similar freedoms for all, the latter crucially consists in choices reflecting divergent guiding principles. Instead of simply offering a choice between crème caramel and chocolate mousse, substantive democracy offers a choice between dining out and watching a movie. For decades already, the alleged ‘objective’ constraints flowing from globalization, a concept that ultimately designates competitiveness at a global scale, have in many countries reduced old political divides between right and left to an extent that socialist and conservative parties present almost interchangeable election platforms. Voters no longer have the choice between higher or lower taxation, or between more or less comprehensive welfare regimes. Their choice is now restricted to the policy areas to be affected by spending cuts and to the category of people to be dropped from social security schemes. Put differently, their choices are reduced to ways in which spending may be cut and in which the tax regime may best compete for private investment.
Still, the erosion of choice is the more benign consequence of a world living to the tune of a sole guiding and therefore totalitarian principle. After all, the erosion of choice is a consequence limited to the level of policies. The greater danger arises precisely from the erosion of checks and balances which goes to the heart of the very notion of liberal democracy as it impacts on politics and on the nature of the polity itself.
Stressing the dangers that the search for increased competitiveness entails for democratic rule does not contradict the claim that such rule only emerges and survives where different power centres permanently compete with each other. This happens on the basis of a minimal consensus which includes the will to live together and the respect of equal rights for all competitors. As we know from history and comparative historical analysis such competition is indeed the conditio sine qua non of liberal democracy ; it is obviously not a sufficient condition as illustrates the argument developed above.
States seek to increase their competitiveness against other states on a global playing field that again includes more states and therefore is larger than they are themselves. On the contrary, the – sustained, sustainable, and therefore roughly symmetrical – competition between power centres that makes a state democratic unfolds on a playing field co-extensive with that state. Put differently, for a state to be internally democratic, plural power centres need to compete with each other within the boundaries of that state. The same state’s external competitiveness does not contribute to its democratic nature, even though it may contribute to its survival, or to the survival of those who run it. Democracy-relevant competition between power centres within a state may obviously include powers external to that state, and indeed it frequently does.
Balanced competition between power centres at a global scale would be a condition for global democracy. Competing power centres no doubt seek to be competitive, but democracy only emerges or survives if none of them outcompetes the others. In the power market no less than in other markets competition needs to be regulated in order to guarantee sustained and sustainable competition through the survival of competitors. Enhancing competitiveness is the objective pursued by an actor such as an individual, a company or a state with regard to other actors. Fostering competition is the objective pursued by the advocates of competition who are rarely identical with the competitors. By restricting and even destroying participation and checks and balances, the search for efficiency is indeed destroying the very foundations of liberal democracy and replacing it with a new form of totalitarianism.
The only serious remaining challenge to efficiency and competitiveness as principles governing the new world order arises from identity politics. In southern Mediterranean and Latin American countries for instance, the sequels to imperialism and the continued perception of domination by the North (or the 'West') strengthen economic nationalism at odds with liberal or neoliberal prescriptions of how to organize the economy. In the North, fears of domination by the formerly dominated closes labour markets to migrants from the South and thus deprives commodity markets of additional consumers and industries of innovative brains. Incidentally, foreign capital is not necessarily more welcome in the North, as shown by the numerous attempts to ‘save’ from Arab or Indian buyers companies relabelled as ‘national champions’. Where the Egyptians do not seek to ‘protect’ themselves against the Sudanese or the Germans against the Poles, the Arabs ‘protect’ themselves against the Europeans and vice-versa. Once again, attempts at defending, strengthening or indeed inventing collective identities and us-versus-them groups are the by-product of policies designed to increase competitiveness. Max Weber and the instrumentalist literature on ethnicity that he inspired provide ample illustration of the mechanisms at work.
What needs to be emphasized in the present context is the inherently authoritarian nature of us-versus-them groups and the religious, ethnic, nationalist or other communalist ideologies that underpin them. They deny voice to those who fail to conform to the criteria that preside over inclusion into the group and therefore force them to exit. They permanently require group members to demonstrate loyalty and tend to subject to a form of inquisition those who live on the margins. As us-versus-them groups by definition depend on boundaries between us and them they tend to strengthen these boundaries through conflicts with their neighbours and counterparts. In situations of external conflict communalist authoritarianism from the bottom is particularly prone to be redoubled by the authoritarian exercise of power from the top, itself permanently legitimised by security concerns .
Ultimately, therefore, the search for competitiveness challenges liberal democracy in two analytically separate ways that in practice of course may reinforce each other. First, as a totalitarian principle that subjugates all other values and by definition erodes a variety of liberties and the checks and balances that are co-terminus with liberal democracy; second, as a principle that, whilst it holds the promise for a better life, simultaneously threatens the prosperity and survival of the weaker competitors; it fuels ideologies and practices that are authoritarian and even totalitarian in the classical sense. As a matter of course, these practices and ideologies are no less hostile to checks and balances. Numerous authoritarian regimes around the world, today and in the past, have been the result of attempts to catch up and compete with economically more successful states. Nineteenth century Prussia, the bureaucratic authoritarian regimes in mid Twentieth century Latin America and more recently Iraq under Saddam Hussein are telling examples, even though they differ widely as far as restrictions to liberties are concerned. The European fascisms of the 1920s, 30s and 40s were partly moved by the same perception of comparative weakness, though combined with and transformed into extreme projects of domination, subjugation and annihilation.
1. Similar to its usage in India, ‘communalism’ refers to purposeful and often violent community building on the basis of criteria such as language or religion that seem to delineate boundaries between those inside and those outside, very much in the sense of Fredrik Barth’s ‘ethnic boundaries’ or Georg Elwert’s ‘us-versus-them groups’.; see Fredrik Barth (ed.), Ethnic Groups and Boundaries: The Social Organisation of Culture Difference, Oslo, Universitetsforlaget, 1969; Georg Elwert, ‘Boundaries, Cohesion and Switching: On We-Groups in Ethnic, National and Religious Forms’, in Hans-Rudolf Wicker (ed.), Rethinking Nationalism and Ethnicity: The Struggle for Meaning and Order in Europe, Oxford, Berg Publishers 1997, pp. 251–273.
3. See for instance the chapter 3 ‘The State as Problem and Solution: Predation, Embedded Autonomy, and structural Cahnge’ by Peter Evans, in Stephan Haggard & Robert R. Kaufman, The Politics of Economic Adjustment, Princeton, Princeton University Press, 1983, pp. 139–181; see the chapter 1 ‘In Search of a Manual for Technopols’ by John Wiliamson and the last chapter ‘The Political Conditions for Economic reform’ by John Williamson & Stephan Haggard, in John Williamson (ed.), The Political Economy of Policy Reform, Washington, D.C., Institute for International Economics, 1994, pp. 1–47 and pp. 527–598; John Waterbury, ‘The Political Management of Economic Adjustement and Reform’, in Joan M. Nelson, Fragile Coalitions: The Politics of Economic Adjustment, New Brunswick (N.J.), Transactions Books, 1989, pp. 39–56.
4. Wendy Brown, ‘Neo-Liberalism and the End of Liberal Democracy’, in Theory and Event, vol.7 (2003), no.1; Myriam Revault d’Allonnes, Pourquoi nons n’aimons pas la démocratie, Paris, Seuil, 2010, p.124f ; Michel Foucault, Naissance de la biopolitique, Paris, Gallimard, 2004, p.120-125
17. Gilles Massardier, ‘Authoritarian Islands in Pluralist Democracies’, in: Eberhard Kienle (ed), Democracy Building and Democracy Erosion: Political Change North and South of the Mediterranean, London, Saqi, 2009, pp.187-213.
18. Eberhard Kienle, A Grand Delusion: Democracy and Economic Reform in Egypt, op. cit., pp. 154–160 and pp. 187–192; Marsha Pripstein Posusney, Labor and the State in Egypt: Workers, Unions, and Economic Restructuring, New York, Columbia University Press, 1997, see elsewhere in text.
20. Dietrich Rueschemeyer, Evelyne Huber-Stephens & John D. Stephens, Capitalist Development and Democracy, Cambridge, Cambridge University Press, 1992; Charles Tilly, Contention and Democracy in Europe: 1650–2000, Cambridge, Cambridge University Press, 2004; Kathleen Thelen & Sven Steinmo, ‘Historical Institutionalism in Comparative Perspectives’, in Kathleen Thelen, Sven Steinmo & Frank Longstreth (eds), Structuring Politics: Historical Institutionalism in Comparative Analysis, Cambridge, Cambridge University Press, 1992.