Socialist Register 2022 discusses the impasse in the neoliberal consensus, the rise of authoritarian politics, and the prospects for the left, finds Dominic Alexander

Socialist Register 2022: New Polarisations, Old Contradictions, The Crisis of Centrism, eds. Greg Albo, Leo Panitch, and Colin Leys (Merlin Press 2021), xviii, 326pp.

Neoliberalism in practice began in dictatorship and bloodshed in 1973 after Augusto Pinochet’s US-backed coup in Chile overthrew its elected social-democratic government. By the 1980s, this suite of economic and social policies had come to be applied in developed democracies, most notably the USA under Reagan, and the UK under Thatcher. Given its origins, it is somewhat ironic that this vein of ‘free-market’ economics has come to be identified as ‘centrism’, and re-united with political liberalism.

There has always been a greater or lesser degree of violence involved in the imposition of neoliberalism. As Ingar Solty points out in his contribution to Socialist Register 2022: ‘Neoliberalism’s “strong markets” have consistently fostered “strong states” and authoritarian political, administrative, and constitutional practices’ (p.54). Moreover, he notes, rather than fostering economic stability, it has led to a string of financial crises, culminating in the 2008 crash from which the world economy has yet to recover.

Jayati Ghosh agrees, saying that ‘neoliberal financial globalisation is incompatible with democracy’ in India and elsewhere (p.195). Similarly, Marcus Gilroy-Ware, in a sensibly sceptical argument on the importance of social media, opens by noting that ‘the liberal fantasy of a stable “capitalist democracy” has steadily disintegrated in the last few years’ (p.93). The common concern across this volume is the various ways that neoliberalism has been the direct cause of the current rise of right-wing nationalism and neo-fascism, as well as the consolidation of existing authoritarian regimes.

The banking crisis of 2008 required an apparent volte-face in orthodox free-market policy, with massive government interventions worldwide, but this was Keynesianism for private finance corporations, which was to be paid for by public austerity. The widening gulf of inequality, already great before this, gaped still further. Neoliberalism was only ever about shrinking the state in terms of public services, the facilitating role the state could play for capitalism was never threatened; indeed, state largess to powerful players has grown ever larger across time.

This combination of crisis, immiseration for many, and the increasing stench of hypocrisy, has fuelled widespread disenchantment with the political system and much else. A recurring concern in the contributions to Socialist Register 2022 is the various ways that the neoliberal regime has driven all this, creating its own monsters. The key focus is on the United States, but there also are contributions looking at Russia, Brazil, India, and South Africa as countries where outright authoritarian regimes have become established.

An accompanying theme is the position of the left, and the prospects it has for providing an alternative to ‘centrist’ and authoritarian versions of neoliberalism. This is certainly an uphill task in many ways, not least because the ‘centre’, for example in America, continues to find the ‘left’s “transformational” agenda deeply disturbing.’ That hostility to the mildest of social-democratic programmes is mirrored elsewhere, in Britain being represented by the Starmer leadership’s stampede towards a contentless neo-Blairism. If the least redistributive measures are refused, if public services continue to be starved of resources, and if post-Covid, austerity returns to pay for the pandemic, then this will fuel the desperation on which the far-right thrives. Those who bewail the rise of illiberal nationalist forces now, while holding the neoliberal economic line, are responsible for causing what they purport to stand against. And yet, the problem is really that capital in general finds any radical right tendencies far less threatening than the smallest shift to the left.

This equation only underlines the importance of the judgement the editors make at the start: ‘a left that is just re-emerging needs to take steps not to slip into spending all its energies in aligning itself with the liberal-progressive forces backing Biden as opposed to organizing workers and independent campaigns’ (pp.xv-xvi). A fully independent left able to challenge neoliberal economics, as well as racist nationalism, is indeed essential.

Neoliberalism in crisis

The opening two articles of Socialist Register 2022 set the current political crisis in the context of the economic impasse that the neoliberal regime has come to since 2008 and now the pandemic. Simon Mohun notes that because ‘the world economy had become so dependent on large-scale financial state interventions, it is not surprising that neoliberalism has been drifting in a directionless manner’ (p.17). The reasons why capitalism has been unable to recover from the 2008 crash are various, but whatever the preferred explanation, it is clear that a return to the pre-crisis consensus will not be sustainable.

Mohun goes on to conclude that ‘a neoliberal political response favouring some sort of Keynesian expansionism’ is encouraged by the circumstances, but this is very unlikely to mean any return to the post-war social-democratic model or any real effort to reduce inequality. One of the structural reasons Mohun gives for this is the ‘income shift to the one per cent’, which ‘has provided a great deal of cash for financial markets’ (p.14). The threat of increased taxation over both corporations and individuals of the 1%, which would be required for a progressive Keynesianism, threatens these dominant interests, at a time of low growth and overall low rates of profit.

Mohun’s focus is on the nature of ‘financialisation’ in recent decades, and the growing weight of corporations in the world economy that are ‘non-productive’ in the Marxist sense; that is to say that they do not create surplus value, or are able to extract more surplus value out of the total social fund than they contribute to it (pp.9-10). Financial institutions, like banks, have been essential to the processes summed up by ‘globalisation’. And yet, neoliberalism ultimately failed to return capitalism to the rates of growth and profit of the post-war period, despite the dramatic shift of industrialisation to low-wage economies outside the West. The enormous surge in global as well as national inequalities is a measure of not only capital’s victory over labour, but also of its own inability to legitimise itself through creating the same kind of prosperity seen in the 1950s and 60s in the West.

For many, this might beg the question why capital was prepared to compromise after World War II, but isn’t now. The answer is not fundamentally neoliberalism as an ideology, but rather the capitalist dynamics that long predate the neoliberal period, and have not changed their nature. In this sense, there is nothing actually new about this phase of capitalism, as Samir Gandesha argues; ‘neoliberalism represents a social order in which existing tendencies within capitalism are deepened and sharpened’ (p.268).

The wave of ‘financialisation’ since the 1980s is not separable from the wider processes of globalised capitalism, and the corporations that gained the most from all this will resist measures that might reduce their dominance in the world economy. Tinkering with financial regulations won’t restore any capitalist golden age, as some liberal economists hope, nor will it prevent capital from fleeing into safe havens for investment, such as finance, insurance, and real estate.

The China factor

The analysis of financialisation given by Mohun is complemented by a discussion of China, whose economy has been key to the longevity of the neoliberal economic regime. In the second contribution to the volume, Walden Bello argues that US corporations’ access to the huge low-wage labour pool in China,

‘along with neoliberal restructuring and financialization at home, contributed to halting the precipitous decline of profitability, with profit rates for US corporations climbing from a post-war nadir of 6 per cent in the early eighties to close to 9 per cent in the early to mid-2000s’ (p.27).

However, Bello argues, China’s rise to become ‘the locomotive of the world economy’ in the twenty-first century, has made it ‘the biggest threat to America’s hegemony’ over the capitalist world (p.21). This is because ‘the Chinese state was not like previous client regimes that had been integrated by force into global capitalism’ (p.29). China is capable of independently competing for global influence with the United States in a way that is unlike other developed economies.

Bello argues that by the 2010s, ‘China was a capitalist country’, and that the ‘CCP was not … qualitatively different from the Japanese, Korean and Taiwanese developmental states. They were all examples of bureaucratic elites that spawned their capitalist classes’ (p.32). The difference is that the CCP, for Bello, retains a greater autonomy from its capitalist class than in those other states. Very different views on China are expressed by contributors to Socialist Register 2022, but Bello, at least, does situate the interests of the CCP and its state as being about capitalist development.

This means that imperialist rivalry with the United States, which is already evident, is likely to continue. Bello ends on the subject of whether, as some think, the two powers ‘are on “a collision course for war”’. Alarmingly, he concludes that ‘a pre-emptive move on the part of the United States, given its bellicose history, is a possibility that cannot be dismissed’ (p.48). Indeed, crises in world capitalism have led to major wars before, as everyone knows.

Even if a US-China war is judged to be unlikely for now, this is an issue for anti-war activists across the world to take seriously, as the political impact of belligerent posturing was toxic on its own, even before the present crisis with Ukraine. That some kind of accommodation could be worked out between the capitalist interests of the US and China would have seemed quite possible, in the abstract, since the two economies have depended upon each other quite closely for the last couple of decades. It may very well have suddenly become much less likely due to the events of the last two weeks.

The problem is a political one, as the ruling class in America seeks to maintain its crumbling legitimacy at home, and therefore many interests find it useful to attack China, at least performatively, for nationalist credit at home. The decay of manufacturing and consequent loss of jobs in the US means there is an audience that can be turned towards such messages as an answer to their economic problems. This is an agenda that is shared by the Democrats, of course, as Samir Sonti points out, Biden’s industrial policy ‘has been cast as an imperial one’ (p.148). A break from far-right Trumpism has not changed the fundamental direction in that respect.

The left response

The ‘crisis of centrism’ thus becomes an issue of what the left and the organised working class can do to carve out an alternative path for the world, away from authoritarian nationalisms and endless wars. There is a pessimistic thread about the impact of neoliberalism on the possibility of a socialist challenge that runs through a number of the contributions. Samir Gandesha most systematically develops the issue, outlining the way capitalism has undermined the politics of solidarity, turning workers into ‘atomized subjects competing with one another as individuals’. The result is the emergence of various types of identity politics, due to ‘the damage [neoliberalism] does to subjectivity and the way in which such damage leads to a tendency to embrace destructive identitarian and collectivist fantasies’ (pp.268-9). It can certainly be agreed that this structural problem lies behind the increasing prominence of various highly reactionary currents.

At the same time, however, just as this aspect of the contemporary world is an intensification of forces that have always existed within capitalism, so the countervailing tendencies exist also. The same factors which propelled workers into class consciousness in the past exist now also, and the multiple crises since 2008 have revealed to many across the world the inequitable ways in which power and resources are distributed. Protest, various solidarities, and worker militancy have all shown significant rises during the pandemic. Every period of capitalism has produced contradictory forms of consciousness and political trends, and the same is true of the present.

It would be a mistake, therefore, to conclude from the prominence of far-right views that neoliberalism has so weighted the scales in favour of an authoritarian solution to the crisis that the left must not challenge the ‘centre’ too strongly, for fear of enabling the right. Bill Fletcher, writing on the danger of Trumpism, seems in danger of coming close to such a position when saying ‘the current moment is not one in which to downplay the threat from the far right and turn our attention towards making centrist Democrats the main enemy’ (p.86). This conclusion is predicated on an argument that the left in America has consistently underestimated the potential for a mass right-wing movement: ‘It is difficult for the US left to recognize that there are a lot of very bad people in the US’ (p.74).

There are certainly significant numbers of hard racists and outright fascists in the US, as in other countries, but they will still be a minority. The political question is how to marginalise them, and pull the greater numbers of people towards egalitarian politics of solidarity. Abandoning the necessary arguments against centrist neoliberals because of the danger of reactionary politics will mean the left always effaces itself, and loses its independence. It is in large measure the logic of supporting the lesser evil which has led to the wider perception that there is no left alternative to neoliberalism. It is that impression which has given reactionary, misogynist, and racist currents more purchase.

Independent socialist politics

Thus, failing to organise against the far right would be an egregious error, but it would be equally disastrous if that fight was taken to mean politically tail-ending liberal capitalism. Aspects of a similar problem are seen from a different angle by Adolph Reed Jr. and Touré F. Reed. They chart the history of the civil-rights movement’s diversion away from the centrality of labour-based issues, such as full employment, to being folded into a liberal framework. They locate this moment in the very year of the achievement of the Civil Rights Act of 1964, when ‘representation supplanted redistribution’. The limitations in the state’s acceptance of the civil-rights agenda meant that ‘moralistic rhetoric would licence liberal policymakers’ tendency towards triage and patchwork remedies that failed, by design, to address the root causes of racial inequalities’ (p.117).

Their characterisation of Black Power politics of the subsequent years might be criticised as somewhat one-dimensional, although they see their argument as sharing some ground with Asad Haider, Mistaken Identity: Race and Class in the Age of Trump. Overall, there is an important argument that the mainstream of ‘what we think of as black politics has become a very particular class politics’ of a middle-class strata (p.121). This has enabled the liberal centre to attack the left’s economic agenda, with commentators insisting that ‘the Trump victory made plain the futility of class-based political coalitions as working-class and middle-class whites rejected Barack Obama’s and Hilary Clinton’s alleged progressive economic agenda’ in favour of Trump’s racism (p.122).

The authors point out the absence of any liberal ‘worker-friendly agenda’ in the formers’ programmes, and that Trump’s victory was based on ‘a depressed Democratic turnout’ and disillusion with the outcome of the Obama era. Fletcher’s ‘very bad people’ made use of this, but the response for Reed and Reed is that building ‘a broad working-class based movement is the only way we might successfully defeat the reactionary right wing’ (p.129). Such a movement, committedly anti-racist and anti-sexist, would have the potential to marginalise the appeal of right-wing identitarians, in the US as elsewhere.

In the British context, the former Corbyn aide, James Schneider, usefully points out that in the ‘Red Wall’ seats of the 2019 election, those voters, not previously Tory, ‘who voted Leave in the Brexit referendum and then Tory in the general election have, on average, the most “left-wing” opinions on economic questions’ (p.315). A substantial reason for the Labour loss was that the leadership allowed itself to be folded into a liberal centrist agenda on the Brexit question, rather than striking out in a transformational left direction. The UK is not the US, but in each case it is the failure of the left to articulate clearly its difference from the neoliberal ‘centre’ that enables right-wing populism.

United fronts

Fletcher, however, is not wrong when he argues that ‘this is a time for intense and sincere united front work’ (p.87), as well as building left and workers’ organisation. All this can be agreed readily, but it is important to be clear on what basis and in what circumstances ‘alliances’ are made. For Fletcher, ‘united fronts’ should be made, at least temporarily, even with forces that ‘may not be progressive at all’. This involves precisely the danger of the left tail-ending neoliberalism. A different danger comes in James Schneider’s vision of a ‘party-movement’ that would encompass ‘grass-roots’ campaigns like Stop the War and Extinction Rebellion (p.322). Here the essential difference in the nature of coalitions around a particular issue, like war or climate change, and campaigns for an electoral party, has been elided, where the two types of political mobilisation need to remain distinct.

United fronts need to be able to unite people with a range of political views on other issues, and therefore you cannot by definition ‘bring in’ such organisations to a political party. A particular campaign, say over abortion rights, would necessarily involve very wide coalitions, precisely to harness the majority in favour of women’s rights. Nonetheless, socialists need to maintain their own organisational independence and voice, and not be subsumed within other agendas, say those of powerful NGOs in the climate movement.

When it comes to the political parties on which social-democratic hopes are based, there needs to be an independent, extra-parliamentary (or extra-Congressional) left, that can operate separately. This is especially necessary to prevent collapses on the left, after figures like Sanders and Corbyn are defeated. Most of all, if left activism remains tied to an electoral party, it will not be able to build precisely the political class consciousness that only arises through social movements and struggles.

As always with a volume of Socialist Register, there is far more that should be discussed than can fit in one review. The damage done by neoliberalism on the working class and the left is broadly uncontroversial, and the contributions from Russia, India, Brazil and South Africa demonstrate how, despite vastly different circumstances, neoliberalism has consistently undermined democracy, or hopes for it.

Some contributors showed a certain note of cautious optimism about Biden’s programme, and the potential for a revival of Keynesian expansionist economics. With the benefit of hindsight, the more pessimistic notes on this prospect seem the wiser predictions; neoliberalism was never going to hand over to even the most moderate left so easily. What remains is that building independent left organisation is vital, but there seems to be much less clarity here on precisely how to do that. Perhaps that should be the subject of another volume as soon as possible.

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Dominic Alexander

Dominic Alexander is a member of Counterfire, for which he is the book review editor. He is a longstanding activist in north London. He is a historian whose work includes the book Saints and Animals in the Middle Ages (2008), a social history of medieval wonder tales, and articles on London’s first revolutionary, William Longbeard, and the revolt of 1196, in Viator 48:3 (2017), and Science and Society 84:3 (July 2020). He is also the author of the Counterfire books, The Limits of Keynesianism (2018) and Trotsky in the Bronze Age (2020).