What's Next For Liberalism?

Before I begin, I want to make clear that I would be really keen to hear comments and critiques from left-leaning readers of my humble blog. Epistemic closure, or living in an intellectual bubble where you read, talk, and hear from people that only agree with you, is a real threat that I always want to avoid. This post is about the future of liberalism. Not identifying with the currently conceived liberal tradition, I humbly offer my comments, with the knowledge that I could be widely off the mark. If I am wrong, or ignorant of some insight, please correct me.

Pundits, particularly daft pundits, love to pronounce the death of things. Romney is dead in the water, the media cacophony screamed at us, until he came back after a decisive first debate victory and took the lead in most national polls. The GOP is dead, pronounced the pundits four years ago. The GOP later came roaring back, taking the House of Representatives in what was one of the largest off-term election victories in US history. The Democratic Party is dead, said many in 2004 after Bush held onto the presidency and led his party to shore up their margins in Congress. The Democrats came roaring back in 2006 and 2008. Go further back, and this trend repeats itself. Political parties, ideologies, and movements, are often eagerly declared dead, usually by their enemies. Some stay dead. Others are not really dead but merely resting. Still others are actually dead, but are then reborn like Lazarus.

Whatever the case, be on the lookout for a writer that declares some movement dead. This prognostication disguised as insight is usually base wish casting. The only ideology that I can think of as actually dead is old-school centrally planned state socialism, a la the Soviet Union. The reoccurring foolishness of man, however, may eventually prove me wrong on this point.

With this in mind, let me, without any hint of irony, break the rule I just established and declare liberalism, or at least the contemporary American conception of it, dead. If not dead, then dying. If not dying, then weakening and growing brittle, like a man past his prime.

This is patently absurd, you may say. The Democrats control the Senate and Obama is currently in the White House. Despite a deficit in the polls, it’s very likely he could win re-election. Recent victories by conservatives do not a trend make.

All of this is true, and I would be the first to caution against interpreting recent events as long term trends. Still, it seems to me that liberalism is directionless. The grand vision that it once had for America society has faded, partially because of its own victories. It continues along, powered no longer by idealism but by petty constituency politics. The liberalism of tomorrow, I believe, will not be defined by a coherent objective, but by the cobbling together of policies aimed at enriching highly specific and fragmented groups. It may win future electoral victories by cobbling together enough of these groups to form a voting majority, but no longer will it claim the mantle of being “the sole intellectual tradition” of the United States. Its hegemony over the politics and culture of the United States, erected by Roosevelt in the 1930s, is gradually becoming undone. This is not to say that conservatism will dominate. Instead, I think we will enter into an increasingly intellectually anarchic period of American politics, with all of the excitement and partisan rancour that implies.

Let’s break down what could be a meandering discourse into two sections, the economy and the culture. I borrow from Ted Kennedy’s speech to the 1980 Democratic Convention, when he spoke of the twin platforms of “economic democracy and social justice in this country.”

Economic democracy is a vague and nebulous term, but if I am being kind to liberalism, I understand it to mean the creation of an economy that is equally as democratic as our political system. There is a simple and attractive notion undermining liberalism’s approach to economics, and it is that the unfairness of life and its inherent arbitrariness should be minimized and fought as much as possible. How is it fair, they ask, that in a country as rich as ours that someone whose only crime is being born poor can go without food, shelter, and medical care? This question and the notion behind it animate much of the economic platform of liberalism. I think that upon first glance, these are very kind and decent thoughts, and I don’t begrudge anyone from holding them. If we look at the Democratic Party as the main, though imperfect, vessel of liberalism in the American system, we can chart a policy course of further attempts to minimize the randomness of one’s circumstances. The New Deal, the Great Society, and most recently, Obamacare, are all steps along the same path.

But here is where the path ends. All of these programs, noble minded though they may be, require money. Not only do they require money, they all subtly, if unknowingly, reduce the natural incentives towards thrift, industriousness, and personal responsibility. In short, they require the wealth of the capitalist system to work, but they undermine that very same system in two ways, one direct and one indirect. They take money out of the productive sector, gumming up the gears of the economy necessary to keep the money pump flowing. They simultaneously erode the overall work ethic and dynamism of the workers in the economy, eroding the innovativeness and competitiveness of the same economy.

We are at the point now where the machine is seizing up. The money has run dry. An era of unrestrained growth, doled out to needy groups, is ending. What does liberalism do when it can no longer expand the state? Of course, the state can continue to expand. A damn the torpedos, full steam ahead strategy could be employed. But this only worsens the inevitable pain and delays the day of fiscal reckoning. How does an ideology built on the government endlessly redressing the problems of poverty continue, when that government runs out of money? What happens when, as is currently occurring in California, governments have to place high and painful taxes on the middle and lower classes just to keep the benefits flowing?

In short, we need austerity liberalism. Can the intellectual proponents of an active and intervening government come up with a new way for the government to continue its activism, when it must pare itself back? As I have long argued, I think liberalism is going to have to come to grips with the fact that it needs to create a small list of spending it considers sacrosanct. Draw a red line around certain programs. Fight for the rest, but be willing to surrender ground.

Finally, we turn to social justice. In my view, social justice is a meaningless term. Putting that aside for the moment, let’s put all of liberalism’s non-economic social stances, such as abortion, under this umbrella. In this area too, liberalism is directionless. Unlike in economics, this directionless state has arisen due to liberalism’s victories, not its defeats. The culture is no longer traditional. The white dominated, protestant led patriarchy is largely dead. The highest positions in society have been opened up to all. Gay marriage has real momentum and will likely become national law after a few generations. Sex is commonplace and demystified. The individual has been liberated from all of the forces supposedly restraining it prior to the sixties. We are all now largely, for better or for worse, socially free. Whereas before we largely had political freedom, the death and destruction of most of society’s social mores and taboos has resulted in an additional social or cultural liberation.

And yet, there is emptiness. There is the obvious question of what next. Few taboos remain. Most groups are now equal. The oppression that now exists in American society is extremely limited, almost laughable when compared to a global view. What battles are there left to fight? Women have been liberated, blacks have been liberated, gays have been liberated. Of course, the struggle is incomplete, but the battles that occur now are rearguard actions, the cleanup of the enemy’s army. Many of these victories should be hailed and are just, but there is some regret, I suspect, amongst the broader populace that we went too far. In our wild, brash struggle for liberation, too much has been destroyed, too many valuable and sacred things tossed over. The sacred, once destroyed, once made commonplace, can never be restored. Useful social mores, however arcane they may be, can never be replaced once their justification is revealed as arbitrary. In this regard, I would frame the question that liberalism now faces this way. For an ideology built on liberation, what do you do after the last chain is broken? Where do you go after the last man is free? Where next, liberalism?

How mitt can win

I’ve had the misfortune of checking various internet sites dedicated to politics – Politico, Daily Caller, Huffpo, etc. – and one thing I keep finding are opinion articles, written by some no-name pundit/hack, offering advice to the faltering Mitt Romney campaign. In one breath, they declare Obama’s triumph to be inevitable, and then in the other, they freely proffer advice for Mitt Romney to seize upon and reinvigorate his dying campaign. Not to be outdone, I humbly offer a policy that I believe would lead Mitt to an easy victory, if only he were to take my sagacious advice.

A brief comment, first, on the state of the race. Obama leads, but by two to three points. I’m sure you can find some polls to back me up on that, and some polls that sharply disagree, but that’s where my gut tells me the race is right now. The Romney campaign is not doomed, quite the opposite really, and Obama is not leading ten points in Ohio and Virginia. I think the race is very close, with Obama possessing a slight edge. However, and this is another judgement call, I think Obama’s support is a mile wide and an inch deep. The volatile nature of this race, and indeed of the global economy and political situation, leads me convinced that a single event could sap some of Obama’s support. The undecideds are supporting him, by default, but are very willing to jump ship.

Now, onto my recommendations.

Romney’s greatest weakness is that he is a rich man, a stereotypical data-driven C.E.O. running for president a mere four years after a horde of white collar Mongolians wrecked havoc on the global economy. The middle voter, still experiencing pain from the recession and lukewarm on Obama’s accomplishments, instinctively hesitates when they see a man embodying all of the worst attributes of upper management. This, to an extent, is not Mitt Romney’s fault. He is a victim of circumstance. Yet he hasn’t done much, or rather, what he’s done has not been successful in dispelling this image.

So how does he overcome this? He can’t fight against this perception by remaking or recasting himself as a blue collar, hard working labourer. Instead, he can, and should, fight this perception on the policy front. That is, he should endorse some token policies that go against his corporate image. And I have an idea on such a policy: breaking up the banks.

Within certain markets, there is sometimes an inherent pressure on firms to consolidate and grow bigger. It makes little sense for there to be hundred of internet providers, for example. In banking, which used to be heavily fragmented on a regional basis, the market has now become highly consolidated. It’s easier than ever before to run a national banking system from a central office somewhere. Within the US, six banks account for two thirds of the entire nation’s assets. SIX BANKS! JUST SIX! Let that fact sit and jostle around in your brain for a bit. $2.4 trillion dollars are controlled by just four banks.

A highly integrated and consolidated banking system does yield some advantages, but it also carries with it some potential system-breaking risks.

First, the firms in any highly consolidated industry start to resemble and behave like monopolists. Through political manipulation and cartel like practices, they limit new entries into the market, lobby for regulation that gives them special advantages, and in extreme circumstances engage in price fixing. The LIBOR scandal in Britain is a perfect example of what happens within an industry that has become too cosy, and thus too corrupt.

Additionally, there is the risk of a systemic collapse when one bank fails. Bank failures happen all of the time. If the bank is isolated, then the government can quickly act to ensure deposits and bring stability to the banking system. If a major national bank with linkages across the entire industry fails, then even the government’s near limitless resources can be overwhelmed. Is this likely? Any understand of the basics of the 2008 financial crisis will prove that not only is this likely, it happened and will probably happen again.

It then makes sense to break these banks up. As someone very sympathetic to capitalism, I recognize that there are times whereby the government can and should intervene to ensure the proper functioning of the market or its continued existence. You would have to be a hardcore anarchist to argue against the government’s power to break up monopolies (as an aside, I think governments tend, on the whole, to produce monopolies, but that’s another post). You can still be a rather strident libertarian and agree that sometimes, the government should step in not to manage companies or even, really, regulate them but to break them up into manageable pieces. We should do that with the banks. If we don’t, look what happens. Government bails them out, and in some cases, directly manages them. Actual socialism. I’ll take a dash of interventionism now if it prevents the flu of socialism later.

Romney, then, should propose to break up the banks. He could portray himself as a populist, a saviour of capitalism, coming from the belly of the beast to slay the beast. A Nixon to China moment, if you will. I don’t think that many on the right would disapprove the idea. You may hear some grumbling, but framed in the right way and it’s a rather right wing policy. The vast majority of people, still hungry for some revenge against the banks, would relish this. Most voters couldn’t be damned to know the in and outs of banking policy. But they would immediately recognize and approve anything that was perceivably a blow against the banks. Ohio voters, a particularly populist bunch, would love it. Independents, still searching for some inkling of reform, would love it. Left wing voters, reluctantly voting for Obama because of the lack of alternatives, would love it. Sure, they wouldn’t vote for Romney, but they might just sit this one out, for the chance to see the big banks getting their comeuppance. Small businesses, a core part of the Republican coalition, would love it. I even think Wall Street would like it. It would be sure to alienate a few of them, but they are smart enough to know the beneficial economic effects it would bring.