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Friday 31 March 2023

Martin Wolf The Crisis of Democratic Capitalism


Martin Wolf was born in London in 1946, the first son of war-time Austrian and Dutch Jewish refugees. His is a powerful voice at The Financial Times where he is Chief Economics Commentator and one of the reasons why I pay for an online subscription to the only daily newspaper of which I am a regular reader.

This is the sort of book which invites the appellation “magisterial” - the small print footnotes run to seventy pages - and the opening chapters provide a wide-ranging, detailed but always readable account of the emergence of those hybrid forms of societies and states in which market capitalism is combined with liberal democratic government. The combination is really very recent, not much more than a century on a generous interpretation, and though Wolf reckons it the best form of society which flawed human beings can achieve, it is fragile. Rapacious capitalists don’t like to be constrained by laws and taxation and personality-disordered would-be tyrants don’t like to be constrained by elections and parliaments. But such people do appeal to electorates which sometimes vote for their own disenfranchisement. They did so  in 1930s Germany, repeated the story in 2000s Russia, and capped it in the USA by turning out for Donald Trump - who figures largely in this book, held up as a warning to us all of the imminent peril in which we all now live: the implosion of American democracy. England’s pitiful old people’s vote to leave the European Union was provincial farce compared to these global tragedies.

There are blind spots in the narrative. The blindness of the victorious allies in framing the Treaty of Versailles opened Hitler’s route to power; the Wild East Americans who brought their brand of "freedom n mocracy" to Moscow in the 1990s paved the way for the rise of Putin; the subordination of the Democratic Party to the imperatives of Wall Street provided the plutocrat populist Donald Trump with a vast constituency of disaffected poorer white Americans. The capitalist liberal democracies have things to answer for - and I haven’t even mentioned their colonial adventures, also sidelined here. But, still, I can’t now disagree with Martin Wolf that nothing better than a social democrat version of capitalist liberal democracy is ever likely to be on successful offer. And the offers are often being rejected.

The first half of the book does a very good job and I was engrossed. But after that I was less impressed. What follows is a very extended wish list of things which if done would make our lives materially better and more secure. Now I am the same age as Mr Wolf and I have been reading these wish lists since I was a teenager. Probably he has too. If you took a course in British Politics at university (as I am afraid I did) then you would read books about the “Reform of Parliament” (The title of a once well -known 1964 book by Bernard Crick). Sixty years on, reformers are still whistling in the wind. Voters don’t want reform of Parliament - they turned down the chance of proportional representation when offered  in a referendum. MPs definitely don’t want reform of Parliament either, even left-wing  ones who often turn out to be as hidebound as the worst rural Tory squire. Think Michael Martin, who became a true-blue reactionary Speaker and Dennis Skinner who sat on his safe Bolsover seat for 49 years and to my knowledge achieved nothing. ( He was very upset when an uninitiated new MP once took his reserved clubland seat on the front bench).

Of course, I was pleased when I found things here which are also on my own wish list (see my The Best I Can Do 2016).  But many of them rate no more than a sentence or short paragraph and I can’t see any powerful party or group mobilising around many or most of  them. You might say that it is the achievement (so far) of Sir Keir Starmer to realise that his scope for doing anything of lasting significance if he leads his party to a General Election victory is almost zero. He can aim to be competent, that's all. A dozen years of Conservative incompetence of which Dr Kwarteng’s budget was the crowning glory ensures that there is little room for spending (kiss goodbye once again to hopes of new infrastructure). And if Sir Keir ventures into the culture wars then it will be a vote loser - the right-wing press has secured that already even though the irony is that most Woke policies (such as they are) are fairly reactionary, designed to secure the comfort and lifestyle of very small sections of the population - Martin Wolf briefly picks up on that in a critique of identity politics.  There is very little which is progressive about identity politics; politics is progressive when it advances progressive values like equality of opportunity, not when it advances sectional zero-sum claims to the best that’s on offer. 

People bandy around words like “Representation” without pausing to think what it might mean in many complex contexts; they just think it means they should get the job. (Once you start putting fresh faces on bank notes, you hit problems of representation which are fairly intractable and end up being resolved in favour of the most persistent lobbyists - see my Sample Essays (2020) for a discussion. The problem is perfectly general).

Nonetheless, it’s worth reading through the wish lists just to remind oneself of how daunting is the task anyone of goodwill and some influence would face. Martin Wolf can barely stop himself from saying that in the USA the battle has already been lost; the productive union of market capitalism and liberal democratic politics is already and irretrievably broken. The plutocrats have mastered the art of securing the endorsement of those whose lives are increasingly nasty, brutish and short but which won't get any better under plutocratic (and capricious) rule.

As David Runciman observed in a clear-headed review of Martin Wolf in the London Review of Books, “this book leaves you feeling that what’s needed is a miracle”.