IN PURSUIT OF THE JUST ECONOMY

Dick Pountain/ Political Quarterly/ 18 Jul 2020

Book Review: ‘Capital and Ideology’ by Thomas Piketty, Belknap Press Harvard, 2019, pp1091

Thomas Piketty's place as the current scholar of inequality would be hard to dispute. His first huge project, 'Capital In The Twentieth Century' assembled and analysed statistical evidence for economic inequality throughout recorded history, demonstrating that it had remained roughly constant until exponential growth began after the British Industrial Revolution. This growth was interrupted by a pronounced dip between the 20th-century's two World Wars, but has now resumed to a point where 1% of the world population owns 50% of its wealth. 

In this new volume ‘Capital and Ideology’, Piketty applies the same meticulous research methodology to the related question of the different ways that people have justified economic inequality throughout history, and to what was responsible for that dip, which takes him into the realm of political economy. Comparison of his work to Karl Marx's Capital feels inescapable – the significance of his focus on ‘inequality’ versus Marx's focus on ‘exploitation’; the choice of ideology for his second volume, when Marx famously didn't live long enough to fully tackle the subject. However Piketty ends the book with a set of radical and concrete proposals that perhaps demand more attention given the current worldwide crisis. 

Piketty diverges from Marx right from the start, since for him ideology isn’t entirely determined by the mode of production but is conditioned by multiple factors and thus can play out differently at different places and times. In this he is closer to Weber, Veblen, Bourdieu and Boltanski. The gap widens since he treats ‘class’ not as the foundational category it was for Marx but as a secondary effect of factors that include income, wealth and education. He starts the book with a definition of ideology so commonsensical as to be an affront to post-Althusserian, post-modern orthodoxy: 

I use “ideology” in a positive and constructive sense to refer to a set of a priori plausible ideas and discourses describing how society should be struc­tured. An ideology has social, economic, and political dimensions. It is an attempt to respond to a broad set of questions concerning the desirable or ideal organization of society. Given the complexity of the issues, it should be obvious that no ideology can ever command full and total assent: ideological conflict and disagreement are inherent in the very notion of ideology.

For Piketty all ideologies exist to answer two categories of question – about borders (who is us and who is them?) and about property (who’s allowed to own who or what?). The bulk of ‘Capital and Ideology’ consists of detailed examinations of statistics about various ‘inequality regimes’ that have arisen throughout history and across the world – this is not a wholly Eurocentric work even if he does apologise for speaking only French and English. 

Like Marx he periodises history, but not into the same eras. For Piketty premodern societies have a ternary or ‘trifunctional’ structure divided between three classes, the military (warriors, kings, nobles), the clerical (priests, lawyers, scholars), and a ‘third estate’ of merchants, artisans, peasants and workers. The French Revolution marked the first overturning of such an order, to inaugurate the era of ownership or ‘proprietarian’ regimes which separate possession of power from property and create the modern state (though for a long time political rights remain confined to property owners). Proprietarian regimes diminish the influence of the clergy and instead ‘sacralise’ private property itself to render it unquestionable by any political agent. 

The first three parts of the book deal with premodern trifunctional and slave societies, proprietarian and colonial societies, and culminate with the more egalitarian communist and social­-democratic regimes that arose in the 20th century after periodic crises of proprietarian regimes generated resistance from the lower, ‘disadvantaged’ classes. It was these regimes which created that mid-century dip in inequality. In a review of this length I can barely sketch the breadth and complexity of Piketty’s analysis so I’ll cut straight to the chase: he regards communism and social democracy as both having failed, causing a return to extreme inequality in the ‘hypercapitalist’ and ‘postcommunist’ societies we are living through in the 21st century.

For Piketty communism failed because dogmatic application of Marxist theory merely sacralised state property instead of private property: the authoritarianism and economic stagnation this engendered undid those regimes so deeply that post-communist regimes in Russia, China, and Eastern Europe have become staunch supporters of 21st-century neo-liberal ‘hypercapitalism’. It also instilled in the Western democracies a “dis­illusionment, a pervasive doubt about the very possibility of a just economy, which encourages identitarian disengagement”.

He concedes that the social-democratic alternative was the more successful, but began to unravel with the elections of Ronald Reagan and Margaret Thatcher (a process completed by the elections of Donald Trump and Boris Johnson). Social­-democratic parties had lost the ability and ambition to redistribute wealth, which allowed the living standards of middle and working classes to stagnate and then erode. Competition between states to lower taxes, encouraged for example by EU membership, compounded this situation. Post-war educational reforms gradually lead to those with higher education voting Left while those without voted Right, an ironic role-reversal that anti-i­mmigrant parties (and factions within older parties) were quick to exploit. Also, while for 50 years the mere existence of a communist counter-model had inhibited capitalist elites and par­ties hostile to redistribution, that inhibition was lifted with the fall of the Soviet Union. But for Piketty the most significant flaw of social-democratic politics lay in confining itself within the nation state, and thus failing to construct the international structures needed to combat capitalist tax evasion and outsourcing. 

For me the crux of his argument, and the most engrossing part of the book, is Part 4 entitled ‘Rethinking The Dimensions Of Political Conflict’. In three chapters on ‘Borders and Property’, ‘Brahmin Left’ and ‘Social Nativism’ Piketty applies his schemas to the current politics of the UK, USA, Europe, India and Brazil. By analysing statistics on voting patterns, wealth and education he demolishes perceptions of the balance of electoral forces on both Left and Right. His thesis will be controversial and likely to evoke furious condemnation from the Left. He contends that the Left-Right cleavage (which he labels as ideologically ‘classist’) is being displaced by a more complex set of contests:

Briefly put, the social hypothesis is this: that the less educationally advantaged classes came to believe that the parties of the left now favor the newly advantaged educated classes and their children over people of more modest backgrounds [...]  the classist left­ right party systems of the postwar era have given way to a system of dual elites consisting of a “Brahmin left” attractive to the highly educated and a “merchant right” attractive to the wealthy and highly paid.

The political struggle is no longer two- but four-sided: inegalitarian internationalists (pro-immigrant, pro-rich); inegalitarian nativists (anti-immigrant, pro­-rich); egalitarian internationalists (pro­-immigrant, pro-poor); and egalitarian nativists (anti-­immigrant, pro­-poor). Older ruling parties, like both Labour and Conservative in the UK and Republican/Democrat in the USA, are often internally split along such lines, and egalitarian nativists may of course merely adopt an egalitarian pose as an electoral tactic – a whole three-page section is devoted to his critique of the term ‘populist’. 

Piketty is certainly a reformist, but not a liberal reformist. In the final chapter 17 of Part 4 he proposes fiscal and legal measures sufficiently radical that if implemented they would, he claims, transcend capitalism: he regards them as a minimum requirement to bring the egalitarian portions of the electorate back together. These measures include a return to steeply progressive taxation, with confiscatory wealth, property, inheritance and carbon taxes. Rather than a universal basic income he demands a universal capital endowment to be paid to everyone on their 25th birthday. Industry is to be co-managed through compulsory representation of workers on all company boards, and fiscal transparency to be imposed through a world-wide financial register. And to top it all off, Piketty recommends constitutional amendments to protect these measures against future diminution. 

He refrains from putting exact figures on tax rates and board numbers on the grounds that these are matters for public, political debate and negotiation, hence his own preferred label of ‘participatory socialism’. Such policies could equally be described as radical, ‘Bernsteinian’ social democracy. Whatever we call them, they’re precisely the concrete political-economic policies so badly needed by, but so conspicuously absent from, recent radical movements like Occupy Wall Street. 

Marx’s ‘Capital’ was the foundational document of 20th-century labour movements and thus changed history, but his insights became ossified into a quasi-religious dogma that still hinders even the democratic Left via an unspoken teleological belief that history leads us inevitably toward success: “would be revolutionaries who argue that nothing can be done until the conditions for revolution are ripe” in Piketty’s words. The 21st-century world he analyses is one already altered by Marx, and his multi-factorial approach can help us understand why the Left/Right demarcation became so confused. 

Capitalists will certainly mobilise colossal resources to oppose these measures, and when I first proposed this review to our esteemed Literary Editor on 19th February 2020 I might well have joined a chorus accusing Piketty of naivety. What neither of us knew was that 9 cases of Covid-19 had been reported in the UK that day. Two weeks later there were 85, a month after that 43,282. That's what 'exponential' looks like, those are the sorts of fact in which Piketty deals. We face economic meltdown of a depth yet to be plumbed, and maybe a moment of historic bifurcation where the only alternatives are something like Piketty’s participatory socialism or descent into a neo-feudal regime with most people jobless and poor, and the insulated, corona-vaccinated 1% as a new ‘nobility’. 

WHAT'S THE MATTER WITH AMERICA/ NEOCONSERVATISM

Dick Pountain/Tue 23 November 2004/2:12 pm/Political Quarterly

TITLE: What's The Matter With America
AUTHOR: Thomas Frank
PUBLISHER: Secker & Warburg
PUBLISHED: May 2004, paperback, pp 306, £12.99

TITLE: Neoconservatism
EDITOR: Irwin Stelzer
PUBLISHER:
PUBLISHED: October 2004, hardback, pp 328, £19.99

On US election night CNN's presenters seemed mesmerised by their animated map of the country, as it unfolded the picture of a solid red Republican heartland, barely wrapped to the east and west by a thin blue rind of rootless cosmopolitan Democrats. I was struck for the first time by the ironic way this colour symbolism reverses itself as you cross the Atlantic: in Europe red stands for Left and blue for Right. However after reading Thomas Frank's 'What's the Matter with America' I'm no longer so sure that this is irony at all. Frank makes a persuasive case that the Republicans have captured the votes of a majority of the American working-class by mobilising the very forces of populism that the Left used to exploit so successfully in the late 19th century and during the 1930's New Deal. (Incidentally, the US edition was called "What's The Matter With Kansas" and its content is entirely drawn from that state; the UK publishers substituted "America", which was commercially shrewd but risks overstretching the generality of Frank's argument).

Frank demonstrates how the Bush camp's clever blend of neoconservative and evangelical Christian rhetoric touches a raw nerve among Middle-American voters whose real standard of living has been in decline for a decade and who have deep concerns about a failing educational system and the excesses of popular culture. This rhetoric very effectively diverts attention from the economic to the moral realm, persuading plain folk that their real enemies are the latte-drinking, porn-addicted, Volvo-driving liberals of New York and California, rather than the corporations that closed down their factories (or re-staffed them with non-unionised immigrant labour).

There are several real ironies at work here. Those blue coastal sanctuaries of decadence of course do really represent the frontlines of late capitalist development: the TV, film, music, publishing, advertising, communications and computer industries. They really are where all the smart money has gone, and they really do, by-and-large, look down on the 'redneck' farmers and factory workers of Kansas. George W. Bush holds together a coalition of traditional Republican Big Business, neoconservative think-tankies and evangelical Christians which draws its electoral support from patriotic, free-market and family loving citizens of the suburbs and the heartland. The Democrats are losing their purchase on this constituency not only because they are perceived as too liberal and 'anti-family' (e.g. on abortion and gay marriage), but because - thanks to Clinton's 'triangulation' strategy - they no longer offer any credible alternative on the economy. Kansans no longer believe that voting Democrat will save their jobs, so they vote with their hearts.

Frank traces the Democrats' decline in his home state in a scathing, witty and readable style, illustrating with scores of episodes from history - starting from the original 'Free Soil' settlers who moved there to stop slavery spreading west, all the way to the collapse of the 1990s telecomm boom and the retreat of aircraft building. A central plank of his argument is that  "...to understand the United States we must understand the backlash". The Great Backlash is Frank's term for the moral revulsion of Middle Americans away from that liberalisation of social values that remains the legacy of the 1960s 'counter-culture'.

The principal theorists behind this backlash are the neoconservatives, whose main ideas are admirably explained in a new essay collection of that name edited by Irwin Stelzer. There's a strong tendency in Europe, particularly on the Left, to conflate the neoconservative and religious elements of Bush's coalition, and to indulge in conspiracy theories about the shady 'cabal' of neocons who are the power behind Bush's throne. The essays in this volume ought to dispel such confusions and make possible a more rational critique of neoconservatism, but I won't be holding my breath...

Several of the essays, especially those by Irving Kristol and Jeane Kirkpatrick, sketch the origins of neoconservatism. The first neocons were liberal Democrats who in the 1970s became alarmed by the nihilism and moral relativism of the radical Left, particularly in its attacks on academic freedom. When McGovern's 1972 presidential campaign appeared to endorse this disorder, these pioneers, including Norman Podhoretz and Kirkpatrick, moved toward the Republican party. Neocons first achieved significant political influence during the Reagan presidency, and some like Richard Perle and Elliott Abrams served George Bush Sr. When George W. appointed several prominent neocons, including Perle and Paul Wolfowitz, they at first seemed rather peripheral to the 'compassionate conservatism' that got him elected - until the colossal shock of 9/11 made their hard-line doctrines look like his most appropriate response.

 Adam Wolfson's essay on page 213, 'Conservatives and Neoconservatives', perhaps should have started this collection as it lays out neocon principles and their differences from other Republican factions with admirable clarity. Wolfson explains that the neocons aim to reform the Republicans into a party fit to manage a modern superstate, which means repudiating some other conservative factions: the 'traditionalists' with their nostalgic hankerings after a vanished genteel past and distaste for mass democracy; the 'libertarians' whose uncritical worship of the free market leads effectively to anarchism in social matters; and 'paleoconservatives' who seek to construct an ugly, isolationist, barely-concealed-racist order under the confederate flag. For Wolfson the crowning difference is that neocons put politics, rather than the economy (libertarians) or culture (trads) at the helm.
  
A clever and convincing essay by Max Boot demolishes many of the canards promulgated against neoconservatism by its enemies, including what might be called the 'Likud Libel' (that the neocons are a clique of Jews who serve the interests of Israel rather than the USA), or that they're all sinister disciples of an esoteric cult of the philosopher Leo Strauss.

Neocon policy prescriptions aim to dismantle the 'permissive society' and promote a new sense of civic virtue, based on a rehabilitated patriotism and respect for American democracy. Unlike traditional and libertarian conservatives, neocons are not afraid of the state and don't seek to reduce it to impotence - largely because they need its military might to project their foreign policy ambitions. If they favour tax cuts to promote economic growth (and thus quench any egalitarian strivings), then they're happy to run deficits to pay for them: Robert L. Bartley's essay 'The Dread Deficit' leans further toward Keynes and Ricardo than to Milton Friedman. Few neocons actually share the evangelicals' religious foundation for the return to morality they promote: it's a (strictly heterosexual) marriage of political convenience. 

In foreign policy neoconservatives oppose all attempts at world government - they sort the nations into friends and enemies, then aim to reward the former and punish the latter. The ultimate goal, as William Kristol and Robert Kagan describe it in 'National Interest and Global Responsibility' is to spread American democracy throughout the world, and many (though not all) of them regard multilateral organisations and groupings like the UN or even the EU as obstacles to this goal. Essays in this collection by Margaret Thatcher and Tony Blair (billed as "friendly dissenters") seek in their different ways to moderate this US unilateralism while ostensibly offering support. 

Whether this will amount to Empire in the old sense is a question that's split the neocon world, and the invasion of Iraq - which most of them strenuously urged Bush to launch - merely crystallised the problem. Was it an exercise in punishing an enemy, a serious attempt to spread democracy, or something botched in between? George F. Will in this volume ('The Slow Undoing') opposes all hubristic attempts at nation-building, the EU included, taking the Burkean position that nations are complex products of history and circumstance that cannot be fabricated. Neocon superstar Francis Fukuyama - who doesn't appear in this volume - has fallen out with his erstwhile comrades by opposing the invasion. 

The neocons are conspicuously more erudite and cosmopolitan than traditional right-wing thinkers and delight in head-to-head combat with liberal orthodoxies. For me the most provocative essay is 'Broken Windows' by James Q. Wilson and George L. Kelling, which is ostensibly about police foot-patrolling of neighborhoods, but whose subtle, penetrating analysis leads you oh-so-gently into a plausible apologia for vigilantism. Indeed many of the essays share this same clarity, intensity and suave (even glib) assurance that was once a strength of writing from the Left, but has been notably absent from it in recent decades.

These are not people out to conserve anything, but rather out to overthrow an existing order that they detest, only they've substituted the Declaration Of Independence for the Communist Manifesto. And as in older revolutionary tracts there's a certain reticence about real outcomes: jobs lost, people thrown off welfare or taken out by air-strikes. Beneath the muscular, hard-headed prose there lurks a thread of purest Idealism, and like all Idealisms it's destined to be brought low eventually by the diversity and perversity of human nature.