Buying time [Part 2] : Marktvolk vs. Staatsvolk

by eurogreen Thu Aug 21st, 2014 at 09:52:49 AM EST

Continuing my review of Wolfgang Streeck's Buying Time : The delayed crisis of democratic capitalism. (The first installment is here)

I want to strongly recommend reading the book. Streeck is a philosopher and sociologist, and his take on economics is a refreshing re-injection of the social element that orthodox economics so rigorously excludes and ignores. My feeling is that, in the fightback against neoliberalism, "Buying Time" is as important as, and convergent with, Thomas Piketty's "Capital".

Chapter 2 : Neoliberal reform : from tax state to debt state

Streeck documents the progressive disenfranchising of actual electors, as each nation's creditors gain the whip hand after the transformation of our "tax states" into "debt states", and aggressively counters the neo-liberal meme that the slide into debt has been the product of demagogic profligacy.

front-paged by afew

The fundamental political narrative of standard (neo-liberal) economics is that politics is an inherently dirty business; a matter of pandering to pressure groups, and buying them off out of the public purse to assure re-election. Therefore, the perimeter of the commons should be reduced by privatization (according property rights to that which was previously in collective ownership) and the powers of politicians should be circumscribed; "social justice" should be replaced by "market justice".

This discourse is applied with great propaganda success to the huge increase in public debt in the past few decades. It is alleged that this has been a matter of giving too much away to the unproductive elements of society, and that this represents a failure of democracy.

Streeck agrees that there is a failure of democracy involved; however, he convincingly demonstrates that the main driver of increasing debt, and the main beneficiaries of excessive handouts, are respectively neoliberalism and the rich.

The rapid increase of public debt, starting in the 1980s, coincides with "austerity", when central banks set high interest rates to dominate inflation, and choked off economic activity. Governments fought trade union power, and capital improved its profit margins at a time of rocketing unemployment. The social costs were, of course, immense, and paid from the public purse, at a time when, for ideological reasons (and to favour the formation of capital), top income tax rates and company tax were lowered.

Public borrowing filled the gap. As the rich, looking for safe investments for their tax windfalls, were happy to buy government bonds, this had the amusing effect of privatizing a part of the common pool, as governments had to borrow money which was previously theirs through taxation.

The expansion of the financial sector, and the ever-increasing mobility of capital, have made the capital markets a harsh and fickle mistress for democracy. In fact, Streeck identifies the fact that governments are now accountable to two distinct constituencies : their citizen electors, or people of the nation (Staatsvolk), and their creditors, or people of the market (Marktvolk).

Here is Streeck's table, fairly self-explanatory, of the characteristics of these two constituencies of the debt state :

Staatsvolk	Marktvolk
national	international
citizens	investors
civil rights	claims
voters	creditors
elections (periodic)	auctions (continuous)
public opinion	interest rates
loyalty	"confidence"
public services	debt service

The democratic state, ruled and (qua tax state) resourced by its citizens, becomes a democratic debt state as soon as its subsistence depends not only on the financial contributions of its citizens but, to a significant degree, on the confidence of its creditors.

[page 80]

Shorter Streeck : they have us by the short and curlies.

He notes that the functioning of the government bond market is absolutely not transparent : who are the bondholders? How are prices determined? Who finances the rating agencies? Streeck deplores an almost complete lack of research on these crucial matters (is this really the case?). Thus, the bond markets demand growth, stability and long-term guarantees in order to accord their favours (in the form of a low interest rate), but are impossible to predict, completely capricious and unreliable in doing so.

[Editorial note: the implied misogyny is all mine, and absent in Streeck] [Eurogreen's Macho Moment of the Day™ Technology]

It is noted that the emergence of activist bondholders parallels the rise of activist shareholders in the stock market; fund managers want to extract "bondholder value", independently of outcomes for the debtor nation or its citizens. What's more, governments actively seek the advice and policy prescriptions of the Marktvolk. The limitations on the freedom of the Staatsvolk to make democratic decisions declines in parallel. This is now seen as so banal that Alan Greenspan can say in 2007 :

We are lucky that the political decisions in the US, thanks to globalization, have been widely replaced by global market forces. With the exception of national security, it does not matter that much who will be the next president. The world is governed by market forces.”

Feeling depressed yet? But wait, it gets worse... The next chapter covers the EU as enforcer of the neoliberal doctrine. To be published as time allows.

Buying time [Part 2] : Marktvolk vs. Staatsvolk | 33 comments (33 topical, 0 editorial, 0 hidden)

>Dubious history (none / 1)

But of course that isn't really true. Historically speaking, state debt and state budget did go together like a horse and carriage. See: France, Britain and especially the States General from the early modern period.

And the power of the bond-holders - isn't that myth? Isn't there empirical research nowadays that some time after a default States can enter the bond market again? And that there are no "bond market vigilantes"?

Some of the early modern nation states liked to default. Again and again. But the bond holders always returned.

by IM on Wed Aug 20th, 2014 at 01:22:18 PM EST

Re: Dubious history (4.00 / 4)

Well, Streeck's scope is the last 70 years or so. And I'm sure he would agree that governments can shake off the presumed power of the bondholders if they decide to. But so pervasive is the neo-liberal frame, that the no major political party can even formulate the idea, except in Greece.

_{It is rightly acknowledged that people of faith have no monopoly of virtue
- Queen Elizabeth II}

by eurogreen on Wed Aug 20th, 2014 at 02:57:15 PM EST
[ Parent ]

Re: Dubious history (4.00 / 3)

Swedish debt/GDP since the great nordic war:

Wars and various burning of bondholders (mostly by the government buying up debt at market price and cancelling it) dominate until the post-war era. Post-war I don't know. The decrease in debt/gdp around 1945 and 1960 appears rather sharp but perhaps it is just increasing GDP, can't find anything about bonds written down. The last debt peak around is at least the bank crisis of the early 90ies with austerity and introduction of mass unemployment. Then follows a decrease in debt/GDP as a result of a mercantilistic policy of wage depression and a debt reduction target.

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se

by A swedish kind of death on Thu Aug 21st, 2014 at 04:15:59 PM EST
[ Parent ]

Re: Dubious history (4.00 / 2)

They have an excel sheet over the debt (but not GDP). No dramatic decreases in nominal debt in the 40ies or 60ies or 80ies, on the contrary nominal debt is flat during the periods of sharply declining debt/GDP. So increasing GDP it is. In the late 90ies and early 00ies on the otehr hand there is a 20-30% decrease in nominal debt.

Another interesting thing to note is how much of the debt is the governments debt to its central bank. Post war this goes up from around 5% just after the war to about 30% in 1970 and then declines to 0 in 2001. This could reflect the decrease and increase in bond holders power, at it is in their interest that the governmetn does not borrow from the CB, but instead the CB borrows to bondholders who borrows to the government.

Speaking of politics, I found the dramatic 50% decrease in 1779 in the excel sheet. In 1778 the CB holds 50% of the government debt, in 1779 this appears to have been written of as the debt is halfed, the govenremtn does not own the CB anything and there is a major seignorage loss (which is how I guess the CB balanced the books). This is in the same time as Gustav III's Russian war, though I fail to find any details.

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se

by A swedish kind of death on Fri Aug 22nd, 2014 at 03:29:27 AM EST
[ Parent ]

Re: >Dubious history (none / 1)

European Tribune - Buying time [Part 2] : Marktvolk vs. Staatsvolk

The rapid increase of public debt, starting in the 1980s,

Whatever happened in the early modern period, this doesn't seem to be false.

OK, the source of the following chart is data from (cough) Reinhart and Rogoff, but these are time series sourced from the UN and World Bank and don't seem to be in any way suspect.

(From 1977 because the series for France is broken before that date).

Debt levels were clearly moderate in the 70s and rose considerably from the 80s on.

by afew (afew(a in a circle)eurotrib_dot_com) on Sat Aug 23rd, 2014 at 10:04:36 AM EST
[ Parent ]

Re: &gt;Dubious history (none / 0)

As shown above, the development in sweden was different.

And the the do rises in germany are unification and the current crisis. (And of course R & R let it end in 2009 to make it look higher)

by IM on Sat Aug 23rd, 2014 at 12:39:16 PM EST
[ Parent ]

Re: &amp;gt;Dubious history (none / 0)

The time series all end in 2010, and there are many more countries than just Germany.

In many cases, modest debt levels in the 70s rose through the 80s and 90s and beyond (even if we cut off in 2007 to leave the current crisis out of the reckoning). An exception would be the UK (46.1% in 1980, 43.9% in 2007). Sweden shows 26.2% in 1977, 40.1% in 2007.

by afew (afew(a in a circle)eurotrib_dot_com) on Sat Aug 23rd, 2014 at 03:47:24 PM EST
[ Parent ]

Re: &amp;amp;gt;Dubious history (none / 0)

Endpoint bias. And the start point is dubious too. This obsession with public debt is a neoliberal shibboleth anyway. In the real world public debt - considerable public debt is as old as the modern state.

by IM on Sun Aug 24th, 2014 at 07:13:12 AM EST
[ Parent ]

Shibboleth (none / 1)

IM:

Endpoint bias.

Again, the series involve a large number of countries, not just Germany. All the series end in 2010, probably because that was the latest year available when the series were compiled. So no bias I can see. If you don't like these series, find others.

As for "old as the modern state", that's no doubt correct, but I don't know what bearing on the last few decades the high %GDP levels of the more distant past have.

The question, as I understand it, was whether states moved to higher borrowing in the 1980s (as a result of the neoliberal attack on taxation) compared to levels immediately before that, not a century or two beforehand. I don't see the point in trying to dismiss the question because public debt is a "neoliberal shibboleth".

by afew (afew(a in a circle)eurotrib_dot_com) on Sun Aug 24th, 2014 at 03:56:26 PM EST
[ Parent ]

Re: Shibboleth (none / 0)

"Again, the series involve a large number of countries, not just Germany."

Have I said otherwise?

"All the series end in 2010, probably because that was the latest year available when the series were compiled"

In the midst of the great recession. You do know that R & R had a clear political agenda?

Putting things in historical context instead of assuming that the world started in 1977 is a very good reason to discuss this.

"I don't see the point in trying to dismiss the question because public debt is a "neoliberal shibboleth"."

That is very good reason. Streeck is accepting a neoliberal narrative. Why?

by IM on Sun Aug 24th, 2014 at 04:07:02 PM EST
[ Parent ]

Re: Shibboleth (none / 1)

Of course I know R&R had an agenda. But have you actually looked at these series? They go all the way back to whatever date is possible, the 17th century in some cases. So your

IM:

assuming that the world started in 1977

is mistaken (as far as R&R are concerned). It's doubly mistaken (as far as my choices are concerned) because the late 70s, according to Streeck's narrative, were a time when governments relied less on debt, with an increasing recourse to markets to finance expenditure in the following decades. So I see no reason not to start in 1977. As for your complaint about ending in the midst of a great recession, I have already replied that it is easy to cut off in 2007 and avoid it.

As I said, if you don't like the source of these statistics, find others. This I doubt you will bother to do, because your MO is, in general, to bring loud assertions to the table without backing them up.

And this goes for your final point. You have, from the start of this thread, summarily dismissed Streeck's narrative of the neoliberal turn of the 1980s making governments more reliant on markets. Don't ask "Why is Streeck accepting a neoliberal narrative?", not until you have convincingly shown that it is in fact a neoliberal narrative.

by afew (afew(a in a circle)eurotrib_dot_com) on Mon Aug 25th, 2014 at 01:50:27 AM EST
[ Parent ]

Re: Shibboleth (none / 0)

"Of course I know R&R had an agenda."

Then you should at long least start to consider it.

"But have you actually looked at these series? They go all the way back to whatever date is possible, the 17th century in some cases."

So you do have all the information you need about the debt financed state of the 17th, 18, 19th and 20th century. And you still ignore it.

"It's doubly mistaken (as far as my choices are concerned) because the late 70s, according to Streeck's narrative, were a time when governments relied less on debt, with an increasing recourse to markets to finance expenditure in the following decades. So I see no reason not to start in 1977."

But Streeck narrative isn't, you know, true.

"As I said, if you don't like the source of these statistics, find others. This I doubt you will bother to do, because your MO is, in general, to bring loud assertions to the table without backing them up."

While your modus operandi is to make personal smears.

Do you really want to deny the simplest historical facts about the modern state and its foundation on the ability of he modern state to issue debt and mobilize the capital of its own and other national economies? Do I have to drag a history of the bond market of Amsterdam in?

"And this goes for your final point. You have, from the start of this thread, summarily dismissed Streeck's narrative of the neoliberal turn of the 1980s making governments more reliant on markets. "

No. I pointed out that if look at how the modern state actually financed itself, debt was always central. And nothing you said or what your neoliberal authorities said can change this central fact. So a linchpin of what Streeck said is simply wrong. A case of (unwitting ?) acceptance of neoliberal cultural hegemony.

Don't ask "Why is Streeck accepting a neoliberal narrative?", not until you have convincingly shown that it is in fact a neoliberal narrative.

Public debts are a central part of the neoliberal narrative. If you don't want to recognize even this...

by IM on Mon Aug 25th, 2014 at 05:42:22 AM EST
[ Parent ]

Re: Shibboleth (none / 1)

IM:

to make personal smears.

Watch what you say, there are examples of personal smears from you on this blog over the last 24 hours.

IM:

Public debts are a central part of the neoliberal narrative.

Explain in what way. Develop an argument. In particular, explain how saying neoliberal pressure caused governments to borrow more is, in itself, a neoliberal narrative.

by afew (afew(a in a circle)eurotrib_dot_com) on Mon Aug 25th, 2014 at 05:49:31 AM EST
[ Parent ]

Re: Shibboleth (none / 0)

there are examples of personal smears from you on this blog over the last 24 hours.

what?

by IM on Mon Aug 25th, 2014 at 06:01:55 AM EST
[ Parent ]

Re: Shibboleth (none / 0)

"This I doubt you will bother to do, because your MO is, in general, to bring loud assertions to the table without backing them up."

And yes I consider that a personal attack.

by IM on Mon Aug 25th, 2014 at 06:03:35 AM EST
[ Parent ]

Re: Shibboleth (none / 0)

It is an observation of your comments.

Look back over your own and find where you have gone in for much more innuendo and ad hominem. I'll help you by pointing a couple of comments out.

by afew (afew(a in a circle)eurotrib_dot_com) on Mon Aug 25th, 2014 at 07:53:52 AM EST
[ Parent ]

Re: Shibboleth (none / 1)

, explain how saying neoliberal pressure caused governments to borrow more is,

That isn't in doubt. But he also claimed that borrowing more gives markets or perhaps bond markets power. Power not to influence bond prices or yields but policy. And that this power is a new power and didn't exist prior to the turn to neoliberalism.

My argument, resting on empirical and historical evidence, is that the power of the "markets" is vastly overestimated. If governments are depended on bond markets, investors are dependent on public bonds.

Is e. g. the US federal government dependent on bond markets? A government that borrows 10% of gdp in a year obviously is. And what did "Mr. Market" or the "bond market vigilantes" do with this awesome power?

Accept more and more laughable yields.

One reason is the mutual dependence. Say insurers don't have much choice.

The other perhaps more important reason is that there is no "market" "mister market" "vigilantes". Market participants want

security
yields

And the end yields beat security in 9 out of ten cases.

Now, as individuals these investors and their agents are rabid neolibs, if not austrians or whatnot. But as market participants one basis point beats that all.

by IM on Mon Aug 25th, 2014 at 06:26:22 AM EST
[ Parent ]

Re: Shibboleth (none / 0)

Thanks for a fuller argument. Personally, I'm not taking issue with most of it (I don't know what Streeck would say to it).

However, I'd say that a government's fear of rising yields is an important parameter in decision-making. I think both Sarkozy and Hollande blindly followed a "stay under the parapet and hang on to Angela's hand" policy because it kept French bond yields miraculously low when others were seeing punitive highs (no, I'm not personifying market forces in "vigilante" form).

by afew (afew(a in a circle)eurotrib_dot_com) on Mon Aug 25th, 2014 at 08:03:03 AM EST
[ Parent ]

Re: Shibboleth (none / 1)

"I'd say that a government's fear of rising yields is an important parameter in decision-making."

"CASSIUS
Why, man, he doth bestride the narrow world
Like a Colossus, and we petty men
Walk under his huge legs and peep about
To find ourselves dishonorable graves.
Men at some time are masters of their fates.
The fault, dear Brutus, is not in our stars
But in ourselves, that we are underlings."

Yields or at least a permanent change in yields are real. "market sentiments" on the other hand....

by IM on Mon Aug 25th, 2014 at 09:43:58 AM EST
[ Parent ]

Re: Shibboleth (none / 1)

Worth considering that it's part of the financial-media complex.

The main sources media turn to for analysis of government finances come from the financial industries - the "bond investors."

They are not all vigilantes, but they have a very biased view of what is good...

So this is soft power of the bond vigilantes, rather than hard power... but still power...?

by Metatone (metatone [a|t] gmail (dot) com) on Mon Aug 25th, 2014 at 06:04:03 PM EST
[ Parent ]

Re: &gt;Dubious history (4.00 / 3)

Another clear point from that graph is that the vast majority of the rise in France was under right-wing governments. Yet it is a recurrent meme that the French debt is the legacy of profligate socialists.

Earth provides enough to satisfy every man's need, but not every man's greed. Gandhi

by Cyrille (cyrillev domain yahoo.fr) on Sat Aug 23rd, 2014 at 05:16:22 PM EST
[ Parent ]

Re: &amp;gt;Dubious history (4.00 / 5)

Actually it's even worse than that: this is just gross debt.
What should matter more is the net position. And since the left nationalised (which the right never did) in 1981-83, and in general did not privatise as much, that means that the net position of the State was just plundered under right-wing governments.
They managed to accrue much, much more debt while massively selling assets than the left did while, on balance, probably buying more than they sold.

Earth provides enough to satisfy every man's need, but not every man's greed. Gandhi

by Cyrille (cyrillev domain yahoo.fr) on Sat Aug 23rd, 2014 at 05:19:03 PM EST
[ Parent ]

Re: &amp;amp;gt;Dubious history (none / 1)

Disclaimer: where net positions are available in a time series, they are either incomplete or not comparable between countries -- at least, as far as I've been able to find. Gross general government debt offered the best chance at looking at comparable numbers.

Which doesn't negate your point, of course.

by afew (afew(a in a circle)eurotrib_dot_com) on Sun Aug 24th, 2014 at 02:03:52 AM EST
[ Parent ]

Re: &amp;amp;amp;gt;Dubious history (4.00 / 2)

Well, that's the neat trick isn't it?
Promote the use of debt and don't publish anything else, then only gross debt can be used for comparisons, which has a clear austerian/privatiser bias.

When the French government around 2005 was selling assets returning 6% in order to retire debt at 2.5% or so, and claimed financial competence doing that, I wanted to scream.

Earth provides enough to satisfy every man's need, but not every man's greed. Gandhi

by Cyrille (cyrillev domain yahoo.fr) on Sun Aug 24th, 2014 at 03:15:36 AM EST
[ Parent ]

Re: Buying time [Part 2] : Marktvolk (none / 0)

[Editorial note: the implied misogyny is all mine, and absent in Streeck] [Eurogreen's Macho Moment of the Day^TM Technology]

Are you provoking me, after this?

My gender assignment would be the opposite. When it comes to social-political jostle, subtle linguistic differences between need, demand, require are key. You can indeed start to undermine the social power of Marktvolk by describing them as needy or demanding. But the reality is, the activist financiers are the (rather new) Alpha of the societies around the globe. They are respected, revered, powerful, not questioned, left free to act. The real sovereigns. The public is not even a sex object to them, but a domesticated crowd.

The state is still nominally Alpha - with all demanding critique towards it, but with no real liberty to act. That is close to the Democracy ideal - except that the (more or less) equal status of the government and the people was unspokenly discarded as utopian, and the state became the obedient Beta to the People^TM. All philosophical theories of governing should be refurbished with acknowledgement of hierarchical instincts perhaps.

by das monde on Sun Aug 24th, 2014 at 02:07:57 AM EST

Re: Buying time [Part 2] : Marktvolk (none / 0)

I was perhaps subconsciously taking the opposite position to the one you postulate (social demands/social justice = feminine, see it's easy to put a positive spin on the feminine side).
But I strongly disagree with your portrayal of government become subservient to the people (Staatsvolk) : on the contrary, it has pretty much abandoned social demands in its subservience to the Marktvolk.

Certainly it may be helpful to acknowledge the unquestioning, unthinking subservience to neoliberalism in terms of hierarchical instincts, in order to revolt against it. Certainly it's the Alpha Doctrine, to adopt your vocabulary.

_{It is rightly acknowledged that people of faith have no monopoly of virtue
- Queen Elizabeth II}

by eurogreen on Sun Aug 24th, 2014 at 03:34:18 PM EST
[ Parent ]

Re: Buying time [Part 2] : Marktvolk (none / 0)

Democracy is not defined in hierarchal terms. If there is indeed a hidden instinctive demand for hierarchal subservience and clarity, that is a problem for the supposed governing progress. The conservative distaste for welfare state, providing basic needs would have an explanation then.

The famous motto "Government of the people, by the people, for the people" seems to put the people above the government. But literal interpretation soon leads to the libertarian distinction of People^TM. What does democracy mean if< hierarchal relations cannot be avoided?

The liberal-progressive movement had definite successes in the last 100 years, even if ignoring (possibly) crucial aspects of human nature. It is worth to analyze this under several assumptions.

One possibility is that the greatly positive feminine side has a good chance to steer the society when resources are plentiful - but once resource limitations are perceived, "responsible" hierarchal instincts gradually kick in.

by das monde on Mon Aug 25th, 2014 at 07:10:43 AM EST
[ Parent ]

Re: Buying time [Part 2] : (4.00 / 4)

To all: Sorry for being a lousy host, I am currently in Edinburgh enjoying the end of the festival, and will be on the road this coming week.

_{It is rightly acknowledged that people of faith have no monopoly of virtue
- Queen Elizabeth II}

by eurogreen on Sun Aug 24th, 2014 at 03:37:36 PM EST

Buying time [Part 2] : Marktvolk vs. Staatsvolk (none / 0)

"Streeck documents the progressive disenfranchising of actual electors, as each nation's creditors gain the whip hand after the transformation of our "tax states" into "debt states","

wrong

"and aggressively counters the neo-liberal meme that the slide into debt has been the product of demagogic profligacy."

right

So Streeck does know that debt is central to the neoliberal narrative.

by IM on Mon Aug 25th, 2014 at 06:36:08 AM EST

Marktvolk vs. Staatsvolk (none / 1)

That "debt" is central to a neoliberal - and fiscal conservative - viewpoint is disputed by no one and, as such, is not even of very great interest.

Now go into some detailed fact and tell us why Streeck is "wrong" (this is all you can manage?) about a development he says has taken place in which states have gone from taxation to borrowing, with a resulting dependence on markets. It may be wrong, but why don't you actually adduce evidence?

by afew (afew(a in a circle)eurotrib_dot_com) on Mon Aug 25th, 2014 at 07:52:18 AM EST
[ Parent ]

Re: Marktvolk vs. Staatsvolk (none / 0)

The causal story is ass about face. Regulatory capture by looters causes the high levels of public debt (net of monetization - the rising levels of public debt gross of monetization is more probably caused by demographics, but also doesn't much matter). Not the other way around.

If the state wanted to, it could simply fix the treasury yield curve where it wanted it fixed. The fact that the state does not do so is a consequence, not a cause, of rentier regulatory capture.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon Aug 25th, 2014 at 10:59:02 AM EST
[ Parent ]

Marktvolk vs. Staatsvolk (none / 1)

Asia Times Online :: Keynes is dead; long live Marx

The Keynesian view that the government can fine-tune the economy through fiscal and monetary policies to maintain continuous growth is based on the idea that capitalism can be controlled or manipulated by the state and managed by professional economists from government departments in the interest of all. The effectiveness of the Keynesian model is, therefore, based largely on a hope, or illusion; since in reality the power relation between the state and the market/capitalism is usually the other way around. Contrary to the Keynesian perception, economic policy making is more than simply an administrative or technical matter of choice; more importantly, it is a deeply socio-political matter that is organically intertwined with the class nature of the state and the policy making apparatus.

The Marxian theory of unemployment, based on his theory of the reserve army of labor, provides a much robust explanation of the protracted high levels of unemployment than the Keynesian view that attributes the plague of unemployment to the "misguided" or "bad" policies of neoliberalism. Likewise, the Marxian theory of subsistence or poverty wages provides a more cogent account of how or why such poverty levels of wages, as well as a generalized or nationwide predominance of misery, can go hand-in-hand with high levels of corporate profits and/or stock markets than the Keynesian perceptions, which view a high level of wages as a necessary condition for an expansionary economic cycle.
Perhaps more importantly, the Marxian view that meaningful, lasting economic safety-net programs can be carried out only through overwhelming pressure from the masses - and only on a coordinated global scale - provides a more logical and promising solution to the problem of economic hardship for the overwhelming majority of the world population than the neat, purely academic and essentially apolitical Keynesian stimulus packages on a national level.

by das monde on Fri Sep 5th, 2014 at 03:46:53 AM EST

Re: Marktvolk vs. Staatsvolk (none / 0)

Keynesian liberal democracy having been captured by market ideology, the parties that previously represented working people are exhibiting learned helplessness. It's not like there's a political vacuum to the left of the Second International parties; but nothing seems to find enough support to establish a strong bargaining position. Is this the end of the road, at least provisionally, for the bourgeois democratic model? What forms of organisation can emerge to represent the disenfranchised?

... erm stay tuned, I'll do a third diary in a week or two.

_{It is rightly acknowledged that people of faith have no monopoly of virtue
- Queen Elizabeth II}

by eurogreen on Fri Sep 5th, 2014 at 12:18:36 PM EST
[ Parent ]

Buying time [Part 2] : Marktvolk vs. Staatsvolk | 33 comments (33 topical, 0 editorial, 0 hidden)

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