The US electorate has acted as everyone predicted— irrationally.
The ordinary people of the USA have rejected economic policies designed to benefit them - and which have actually done so by creating employment, preventing deflation and by sustaining well-being. They have instead of the policies that will increase unemployment, threaten many more home foreclosures, undermine many banks and increase their national deficit.
This is one of the extraordinary achievements of the neoliberal era. It created the idea of “rational expectations” and so distorted true rationality in the process that they have persuaded people that voting against their best interest is the right thing to do.
The right will, no doubt, claim this as a major turning point,and the re-emergence of the old order, just as they did with the ConDem victory in the UK.
I very strongly suspect that they are wrong. Whilst I do not agree with everything that Anatole Kaletsky wrote in his book Capitalism 4.0 I have no doubt that his suggestion that neoliberal capitalism is, to coin a phrase, a busted flush, is correct. I fully accept that the world has not as yet wholly appreciated this, under this electoral backlash is indication of this, but the model is undoubtedly completely broken, and the extraordinary assumptions on which it was built have been shown to be wholly invalid.
It is only by reform, the creation of a new economic model, and the reinvigoration of both markets and the relationship between markets and government that we can move forward. The American electorate have rejected that for the moment, largely on the back of the enormous sums of money that the old order can still command, but when the prescription that the Republicans offer fails then I have no doubt that a new order will emerge. Just give us a little time.
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If you have time, Richard (and I appreciate you probably don’t) a very good read that gives an insight into where what is happening now came from (and the role of the rich and their cheerleaders, such as the Cato Institute in it) get hold of Thomas Frank’s ‘One Market under God: extreme capitalism, market populism and the end of economic democracy’. It was published a while ago now (2002)but to a UK reader who sits and wonders what the hell goes on politically in the US it provides some incredible (and almost unbelievable) insights.
Given that what happens in the US often happens here a decade later it has particular resonance now.
@Ivan Horrocks
Will do
I wouldn’t call it neo-liberalism. It’s just old fashioned pig ignorance and it comes about when a culture loses respect for education and the media parrots flat earth news all the time.
I was speaking to the partner of a major US law firm which has offices in London recently. He told me that thefirm decided to hold its worldwide partners conference in London this year. Most of the American partners needed to get passports for the first time to attend. And that’s the wealthiest, best educated part of “society” out there. It’s just scary.
Ivan Horrocks and Mad Foetus – you’re frightening me now. Given how Murdoch’s allies in the government have already attacked the BBC and Ofcom, how long before we get a UK equivalent of Fox News peddling the same propogandist claptrap that’s worked in the US for the Tea Party?
Ivan – that sounds an interesting read, thanks for mentioning it.
@sickoftaxdodgers
Not long I suspect, given that our PM can’t even be bothered to hide his contempt for the BBC when giving an interview on a public platform last week.
Roll into that pot the fact that his (ex Murdoch) communications director is clearly untouchable (one wonders what the suituation would have been if similar circumstances had applied to Campbell in the first year of Blair’s government)despite the phone hacking scandal, and the back door visit(s) of Murdoch to No.10 and I’d say a UK variant of Fox news will be on the air well in time for the next election.
Then again, maybe it won’t given that the Tories can rely on the majority of the popular media in this country to promote their cause.
Good suggestion Ivan. I can thoroughly recommend Thomas Frank – his book “What’s the Matter with America?” (published in the US as “What’s the Matter with Kansas?”) is another classic.
I’d also recommend comedian (and US senator) Al Franken’s “Lies and the Lying Liars Who Tell Them: A Fair and Balanced Look at the Right” and Paul Krugman’s “The Conscience of a Liberal” for more insights on recent US politics.
I’m fairly relaxed about the mid-term results – this could be the making of Obama’s presidency. If he drops the ludicrous attempts to be ‘bipartisan’ and instead starts to expose the Republicans for what they are – extremists who want to replace democracy with rule by big business in its own interests – he should start to gain some traction. The complete obstructionism of the Republicans should work in Obama’s favour – as in 1994-6 when Clinton faced down Newt Gingrich and won re-election by a landslide.
I can’t see the Republicans winning the presidency in 2012. They are very unlikely to pick any candidate who isn’t a right-wing crazy in the Sarah Palin mould. About 30% of the US electorate will think that such a candidate is the best thing since sliced bread. The other 70% will run like hell into the polling booth to vote against him or her. In short, as Arnold Schwarzenegger recently suggested, Obama is looking at re-election by a landslide in 2012 – and the House Republicans are probably going to be a massive help to him in that sense. I think this is the high water mark for the Tea Party.
Mad Foetus,
Having moved to the US 4 years ago, I know understand the reason that so many of the professional classes don’t have passports is because they get so few ‘vacation days’ (mid-level lawyers are certainly included here) and they have to spend them visiting their family which is usually dispersed right across the country. Its common for Dad to live in Nevada and Mom in Floriday, not speak of brothers and sisters.
Well Howard, I only hope you’re correct about the next US elections. I agree that Obama’s desire to try and deal with his opponents as though they are reasonable people was a waste of time. The US right are so unreasonable and unscrupulous that he has to expose them for what they are.
The trouble is, are we that much better off here? As Ivan points out, and as Peter Oborne’s excellent Dispatches program showed, Murdoch already has a frightening degree of influence on our politicians. The whole anti BBC attitude of this government is evidence of that.
British politics just gets more depressing with every year that passes.
It shouldn’t be possible for a version of Fox News to be launched here because our laws do not permit such blatant partisanship/lying. The US had similar laws until Reagan repealed them. However, there’s more than one way to skin a cat and I’m sure that Murdoch will have the encyclopedia.
Well, judging by their behaviour so far, I imagine that this government will soon be looking to change the law to enable Murdoch to set up a UK equivalent of Fox News; something that pumps out an endless stream of anti-public sector, anti-BBC, anti-welfare state neoliberal propoganda would suit them just fine.
As Private Eye pointed out, James Murdoch complained in August 2009 that Ofcom was a busybody that should be curbed; and hey presto, it’s just had its budget cut by 28%!
Richard – for once I find myself in absolute and total agreement with you. I would also recommend Winner Take All Politics (http://www.amazon.com/Winner-Take-All-Politics-Washington-Richer-Turned/dp/1416588698) for a good look at how this happened.
Unfortunately the US has a system of ‘democracy’ which is a) not really that democratic b) geared entirely against long-term economic planning and towards short-termism and c) highly vulnerable to ‘capture’ by vested interests. Elections are largely decided by GDP growth and the unemployment rate – and that was decided when Democratic and Republican ‘Moderates’ knee-capped the stimulus. So I have to say I’m not terribly optimistic about the possibility of a democratic resurgence anytime soon. However, there is the slight possibility the Tea-hadists will carry through on their idiotic pledge to block a rise in the debt ceiling – at that point the US will default on its debt and its economy will totally collapse, perhaps convincing voters the GOP are venal, corrupt idiots. Otherwise get ready for several years of long, slow, painful decline until the economy totally collapses.