Do You Remember the End of History?
It was all the rage in the 1990s. Neoliberal capitalism, sometimes called Thatcherism or Reaganism, was supposed to represent the pinnacle of history. The slogan then, as the Iron Lady was fond of saying, was ‘There Is No Alternative’. The task of overturning this totalitarian cant started a long time ago. The Counter-Globalisation Movement that arose at the turn of the century and is associated with the protests in Seattle and Genoa, refused to accept that history was over. It put forward the slogan ‘Another World is Possible’. We were part of those movements and now amidst a momentous world economic crisis we can say quite clearly that we were right and they were wrong.
This is not about gloating – it goes right to the heart of what this crisis really means. Above all, neoliberalism was successful in that most ideological of manoeuvres: claiming the centre ground. Alan Greenspan, former chairman of the US Federal Reserve who oversaw much of the de-regulation that contributed to the present crisis, has admitted that he’s had to re-examine his entire life’s dearest beliefs. The essential dogma of neoliberalism – that markets are the best way to allocate social wealth and resources, because only there can individuals’ pursuit of their self-interest be magically transformed into social progress – has been thoroughly disproved. It is no longer common sense, or the only sensible position: it’s now clear that it was a partisan ideology (rather than neutral ‘science’) all along. To hear someone like Greenspan recognise that is like hearing the Pope say, ‘maybe I’ve been wrong about this whole God business’. This is neoliberalism’s ‘fall of the Berlin wall’ moment.
But to say that the world is going to change doesn’t mean that this will be the end of capitalism, or even necessarily the beginning of anything ‘better’ than neoliberalism. It means that now is the moment when a certain economic and political arrangement created in the late 1970s became unsustainable.
The rise of neoliberalism was partly a response to a politically strong and demanding working class, used to the idea that its basic needs should be met by the welfare state, that real wages would rise, and believing itself entitled to more. Since then, real wages have stagnated or declined, welfare provision has been rolled back and restricted, insecurity and fear have become widespread. In return we got cheap credit, thanks to low interest rates and deregulated financial markets – underwritten by rising house prices (the ‘bubble’ where this crisis began) –, private insurance and pensions, and (particularly in the UK and US) a feast of consumption fuelled not by rising wages, but by rampant personal debt. A very few speculators got very wealthy. Some of us got houses and a pension. Most of us got deep into debt.
Now this whole ‘deal’ has collapsed. The name ‘credit crunch’ says it all: the days when cheap credit compensated for losses in all other areas are over. We face the grim reality of those stagnant wages, precarity, rising prices and ever-shrinking social provision. In short, we in the global North face what most of the world’s population experienced in the 1980s, when the IMF and the World Bank roamed the globe selling ‘structural adjustment’.
It was around this ‘adjustment’ that the initial struggles against neoliberalism took place in the 1990s, and the same could happen now. We can’t know exactly where these new social conflicts will erupt, or in what form; whether they will take hold and become generalised. Perhaps around rising food and utility prices, as people reinvent a centuries-old tradition of price-setting, informed by a ‘moral economy’ of ‘fair prices’ that opposes the ‘political economy’ of the market. Perhaps around housing, remembering lessons from the anti-poll tax movement, as people organise to prevent evictions and reclaim physical space.
But this also means that the shape of the restructuring which will be being designed and debated by the G20 and others over the coming months will depend on how people will react to the situation. Everybody’s talking about a ‘New Deal’: well, the deal we get can only be as good as our capacity to demand – and reclaim – what we want.
History, then, is up for grabs. But we knew that all along.
This article was first published in Mule no. 5
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