Powision: Democracies and financial markets are experiencing a time of crisis. While in your book on post-democracy you touch the first theme, your upcoming book focuses more on the second asking, I believe, why neo-liberalism survived…?
Colin Crouch: Yes. It’s called in English “the strange non-death of neo-liberalism“. There was a famous book in the 1930s called “the strange death of liberal England” about the collapse of the Liberal Party at the beginning of the 20th century. But mine is about a strange non-death of a later version of liberalism. Neo-liberalism met a crisis in 2008 with the collapse of a financial system constructed on its principles. Several people thought, “Ah, the banks have really brought this model down at last”. But I thought: no it’s going to emerge stronger still: we’ve revealed our dependence on the banks. Everyone else will have to pay.
Powision: Is there a relationship between this strange non-death of neo-liberalism and the problems of democracy you elaborate in your book on post-democracy?
One of the things in my post-democracy book was that the energies of the political system have passed from the democratic sphere to the elite sphere where large corporations go beyond lobbying – and become part of the governing elite. They are inside the house; they are not in the lobby outside. And this is what the financial crisis shows us in a very large way. If you look at why this crisis happened; it was because of a series of deregulations that took place in the United States under the Clinton and Bush administrations. These deregulations were basically designed by people who moved in and out between posts in investment banks and posts in government. They might be in Goldman Sachs one day, they’ll be in government the next day, then they are back in Goldman Sachs… These people designed a deregulation system that suited the interest of those banks. Within a few years of them completing their deregulation work, the whole thing collapsed. So it was a very good example of how certain sectors of the capital have taken control of the political process. And my prediction is that nothing has changed since then: they are still there in the Obama administration. And although there will be attempts at some reregulation now, those financial elites will start their work immediately and gradually achieve deregulation again.
Recently the British government has announced what looks like a fairly tough regulation process for the banks. This is not to be implemented until 2019. There will be at least one general election before then and it gives the financial community nearly eight years in which to lobby and to get it all changed again. At the moment we are all angry at the banks, people want to see regulation. But in eight years’ time, who out there in the ordinary public is still going to be caring? The banks will care very, very much.
Powision: How do this people get into the position that they can switch posts, back and forth between companies and government?
It happens in the US more easily than in Europe because of the curious way in which government and administration are not drawn from the political class but from the business class. People come from the business world in to government and then go back again. There are revolving doors.
It doesn’t happen quite so easily in Europe. What can happen though and what we certainly see happening a lot in the UK is government making very strong use of consultants who come from the private sector and from particular corporate sectors and who actually can acquire civil service status. People can come in from the business world and actually be deep in the heart of the policy making. We see this very clearly in the health sector, where people from the American health companies have been inside government designing the privatization of the national health services. Another thing that happens – and what you certainly have had in Germany – is that politicians, after they finished office, end up working for firms with whose regulation they have been engaged while in government. It used to be, in this country certainly, impossible to do that. There were all sorts of rules about it. But these rules have been relaxed under the weight of the neo-liberal argument that government should not get out of touch with businesses: Business should come into government, government should go into business. Ironically under the label of liberal capitalism you end up breaking one of the fundamental rules of free market capitalism and that is that state and economy have to be separated.
Powision: If state and economy merge together in such a way. Why don’t traditional democratic institutions, especially the party, that represent the will of a huge number of people intervene and stop this diffusion between the two spheres?
This is another part of the story. The rise of corporate power has happened because of the decline of parties as organizations that represent strongly articulated interests and identities.
The mass democratic party to which we became accustomed in the 20th century depended on the historic contingency that two enormous sources of identity were very widespread in populations: Religion and class. In most European societies these identities were at some point associated with struggles for citizenship. Typically it starts with either a particular religious group or a particular class being excluded from formal participation. They therefore mobilised their demand for admission into citizenship. The association of various parties with such demands gradually brought different waves of the population into citizenship. In the process people had a sense of an identity that had a political meaning to them. Now, that has gradually changed. Partly the sheer acceptance of universal citizenship, partly the secularization of religious identities in Europe – but not in the US –, partly the change, not the decline, in the nature of class has eroded all of that.
If for example we look at the changes in class related issues and the shift from an industrial working class to a post-industrial service class, we have a proletariat that hasn’t been associated with struggles for citizenship. It has already been there, it predates the rise of the different class groups.People don’t find it so easy to give a political component to any social identity they have.
Powision: but there are exceptions…
Indeed there are exceptions, dangerous ones in racism and populism, where some people from the majority groups believe that somehow they have become politically excluded. Actually they are not; it is just that they are sharing their country with new sorts of people. But this process is forging a new identity.
Also, women, though they have had formal democratic rights for quite a while, have felt that they haven’t been able to enjoy these rights fully. The feminist movement has been a very powerful new identity that has come to our politics, even though it tends to be absorbed, because in the end all parties respond to it. No party dares to stand against it.
There is still scope for identity formation with a political meaning, but it is rather restricted. So that means the parties cease to stand for the interest of an identifiable group. Instead they want to appeal to everyone because even though they all have got their different bases, these are small and shrinking. Parties seize to be vehicles for forming interests and for giving voice to interests. Rather they have become machines that look out for voters. As soon as a party takes up a very strong position it is in danger of excluding all the people who don’t share that position. Parties have lost their ability to be in the vanguard of political formation. They are part of the rearguard now.
Powision: This detachment of policy formation from political identities and the attachment to “everyone” combined with a closeness of government to corporate interest seems to create a rather closed system that works on its own. Is that what you call post-democracy?
Yes, or rather the move towards it. I am very careful to say two things. First of all post-democracy is not the same as non-democracy or un-democracy or pre-democracy. I use post-democracy in the same way that people use post-industrialism: a post-industrial society is not without industry. In post-democracy, although the institutions of democracy are all in place, even functioning beautifully, the energy of the dynamism is going elsewhere. It has gone into the corporate world. The second point I stress is, that I say we are on the road towards this. I don’t say we have arrived at it. The environmentalist movement, the feminist movement and the racist populist movement would not have been possible if we were in a fully post-democratic society.
Post-democracy concerns this lack of political identity formation: The occupational and the socio-economic work-related life are not providing political meaning. If you take that alongside the rise of corporate power, you have something very fundamental happening in the economy. And the very small elite has a very clear concept of its interests and knows how to articulate them. The rest, basically the work-force, is losing that.
Powision: Then why aren’t we complaining about that too much?
We are complaining; and this is where I see the little gleam of optimism. We have this wonderful growth at the moment of various campaigning groups, civil society groups, “Bürgerinitiativen” that are now making use of the internet and social networks to mobilize campaigns. This is an exciting development and alongside it comes something very interesting. And that is a kind of paradox in neo-liberalism. The first stage of the paradox is the post-democratic diffusion between firms and the state. The fact that firms become very politically influential makes them political actors. In an open society, once you are a political actor, you are politically vulnerable. And so firms then find to their surprise, that they become the target of criticism of a political nature. Their classic response that they want to make to that is: “We are just here to make money, we don’t make the rules, we’re not political, leave us alone go to the government for that: sorry not our job”. They can’t do that anymore because they’ve been saying for three decades now that they can handle everything, that they are more efficient than the state, that the state makes a mess and that corporations should do it. OK, if that means they are political actors, claiming to have public competence, they will then be vulnerable to political criticism. And so one gets a new political arena in which civil society groups directly challenge companies. These need to respond through developing corporate social responsibility policies. Critics then again look at these policies and see where there is hypocrisy and dishonesty and make the companies answer again. So you have the new political debate that is outside the realm of formal politics. In the past, if there was a scandal about a corporation, people were more likely to raise that as an issue with government. Now they more like to raise it directly. It’s not democracy of course. It’s liberalism, it’s pluralism, it’s dynamic. But it is not necessarily democratic, because not all interests are able to organize themselves this way. It is very lopsided.
It does have one other very interesting characteristic and that is another component of the problem of democracy today: capital is global and democracy is national. These new campaigning groups are often themselves transnational. Groups like Amnesty International or Greenpeace they don’t care about national boundaries. They don’t need a national identity to represent. And so they are able to challenge global corporations on their own transnational territory. Post-democracy does not lead to the triumph of the corporations, fullstop, end of game. There is never an end of game; there is a Hegelian dialectic. The thesis is: corporations rule, OK. The antithesis is: no, it’s not OK, and people are out there organizing. That seems an exciting new development in politics.
Powision: But isn’t there are danger, too. That if you look at the Tea Party movement for example we have people organising themselves, true, but they are funded by pseudo-interest-organisations, like “Americans for prosperity” that have been founded by corporate elites. In some way one feels that there is a lack of rationality happening because people organise for things that actually hurt them more than they help them….
Yes, it is very inadequate. Also you are hinting at something there with the Tea-Party case and it can happen to oppositional groups, too, that in the end corporate funding comes in and undermines them. We tend to believe that, if a group stands for some environmental cause and says: “these are the good firms, these are the bad firms, buy their products, they are environmentally friendly” and they put their badge on it, then that is somehow true. We don’t really have any means of discovering if the groups doing this certification receive corporate funding. Some of them have.
So yes, it is not a really good world that is emerging, but I do at least see that there is continuing contestation. Indeed, we can’t beat the monster, but we can be little flies on its back that bite it and irritate it. That’s not asking much, it’s not doing much but at least the monster isn’t completely dominant.
Powision: An alternative to outside-parliament movements versus detached parties and corporate interests would be to just say, forget about the established parties “I am going to make up my own party”. Why does that so seldom happen?
New parties, and quite a few attempts have been made at them, are of two kinds. There are those that appeal in a rather rationalistic way to a perceived set of policy differences with existing parties. They usually have relatively short lives. The other type manages to find a social identity that is deeply felt in people. It is not necessarily very rational, it’s deeply felt. And they articulate that identity and claim to stand for it. If you look at the formation of 20th century British politics, out of the 19th, the party that declined and almost disappeared was the Liberal Party, which, although it had social, deep social identities behind it, wanted to appeal to rational electors. It rapidly became a minor party. The survivors from the 19thcentury were the Conservative Party with its appeal to “nation”, to a Church of England identity against Catholics and minority Protestant and denominations. And the successful new party was the Labour Party, representing a working class that had been politically excluded. These turned out to be the two parties that dominated the 20th century because they were rooted in strongly felt identities, not necessarily in particular rational policy debates. Now, as I was saying earlier, that kind of identity doesn’t get produced in post-industrial societies – Except where there are strong cultural roots to an identity that can see itself as somehow underprivileged. The Greens are actually an interesting exception in a way in that Greenness is not an identity; it’s more like a set of policy concerns. But it is of course a set of policy concerns that is very, very deep, because it is about the future of the planet itself. So it probably gives it a power, that purely policy constructed parties can’t normally achieve.
Powision: So, are you saying that it the causes are something more rooted it works? If it is human rights, something very fundamental, which nobody really opposes or only a small group of people really oppose….
Yes, yes that’s right. You can’t build a party identity on something everybody believes in. Of course this is part of the dangerous nature of strong parties. It is part of a characteristic of strongly politicised identities that, certainly in Germany, and in many other parts of Europe, caused absolutely horrible things to happen in the first half of the 20th century. Democratic strong parties are a very peculiar balance between on the one hand strongly felt identities that see themselves opposed to others and on the other an acceptance of and a complete commitment to the fact that they’ve all got to get along together somehow. We can’t destroy the other side. We’ve got to build a framework in which we can continue together, but express our opposition. It is quite a sophisticated task that human beings didn’t really manage to do outside small elites, until really the latter part of the 20th century. It is a precise balance. If identities get too powerful they start to hate others; if they get too weak, then you get post-democracy.
Powision: So what about a change in attitude towards strong political identities? Some researchers argue that today there is a tendency towards project oriented lifestyle. You participate in communities – say a protest group –and when the project is solved, you make a hook behind it and go to the next project and if that moves faster and faster we produce short term identities. Shouldn’t we think about changing the democratic system towards a system which is more adaptive to short-term identities?
To some extent, I suppose it happens in that parties do respond to changing fashions. You see it more in the United States because there you have just two parties representing a vast extremely heterogeneous nation. And when those parties’ identities are actually rooted in a civil war that is now a century and a half old, these identities are pretty meaningless. That means they are kind of almost empty boxes inviting groups to come and fill them with something. So at the moment the Republican Party is very open to rather strident forms of Christianity. That fashion will probably pass and the Republicans will get rid of it and move on. We start to get catch-all parties of this type also in Europe as our identities fade. These new politics are of course much more suited to the short-term identities you are talking about. Now, I see those kinds of identities going parallel to the world of parties, influencing it, sometimes beings absorbed by it. Basically these are two different fields. On the one hand you have what the party world is designed for and is very good at: elections. They are very important formal, every-few-years-events, that are fundamentally necessary, that are carried out with certain clear rules. This is when democracy is really speaking and the rule that everybody has one vote and no one has more than one vote is fundamental. As soon as you fall from that an appalling corruption comes in and the whole thing starts to collapse.
This tends to be separate from the world of campaigns and debates, where everything is much more rapidly moving, it’s much more post-modern. Its very dynamism that would be endangered by the formal political process and it in turn would endanger the formal political process. So in a way I think it is probably best they stay separate and influence each other.
Powision: If we look at the idea behind this electoral system: you say the main point about it is the voting process and that includes a certain kind of rationality the individual has, to actually be capable of judging on its choices. And isn’t one of the problems within a system moving towards post-democracy, that this rationality is in a way questioned…
Yes, definitively. And the elections become increasingly media events. One of the main ways in which the corporate world came to influence democracy was by developing techniques of mass-communication through advertising products and through market research about products that the political world was very, very grateful to receive. If we look back in the early part of the 20th century, politicians from the old elite groups had enormous difficulty knowing how to talk to the people. There were, I suppose, two models they used. One was the religious preacher. Political rhetoric still has a strong tendency towards preaching; it appeals to values and speaks in terms of right and wrong. The other one was a kind of educational model, the political speech as a lecture. These gradually declined in their salience. In the first part of the 20th century the people who really started to understand how to address vast crowds in a language that could be understood were fascists and communists, and so the centre of the political spectrum was very worried. In a way the American advertising and market research industry provided it with new tools of communication. This meant eventually a trivialisation of debate, as politics followed the evolution of advertising techniques. Original advertising gave you information about the product. Today’s advertisements create an atmosphere with which the product is associated – often an atmosphere that has nothing to do with the product itself. It is not an appeal to a rational action, it is an appeal to a “Stimmung”. Election campaigns have followed this path.
So yes, indeed there is a kind of de-rationalisation through the mediatisation of the political process. What remains unchanged about democracy is its really, really fundamental achievement. Democracy reduces the danger of police terror. Democracies kill fewer of their citizens, the police beat up fewer people. People can’t be easily taken away and disappear. That is what the people of Libya have been demanding. It is the basic taken-for-granted achievement of democracy. Obviously, it is not enough, but no, you never want to lose it. A mediatised spectacle of an election at least gives you rivals who might defeat each other, and one of the consequences of that is that it does tend to reduce the dangers of a police state. Don’t let us ever forget that.
Powision: But in Germany exactly that happened through democracy, didn’t it? If you look at the National Socialist party, they actually gained power through democratic elections and did probably the worst you could ever do to…
Yes, although it was also the case that Hindenburg did not need to make Hitler chancellor. That was an act of choice; the Nazis were actually declining in 1933. It was the old pre-democratic Wilhemine elite that actually allowed Hitler to rule. They said, “Ja”, give him his chance, because they were more fearful of the Communists than the Nazis. One can argue that Germany’s democracy didn’t have its chance to demonstrate whether it really wanted the National Socialists. History doesn’t give us a final answer to that one…
Powision: Isn’t there a fear – if you look to some countries – that this could happen again. Through the media influence and certain groups that could actually benefit from a more nationalised perspective. One of the reasons the national socialists gained power was because they had the support of the conservative media…
Yes, and some of the big corporations… Yes, there is a danger at the moment. In a way Germany is the only country in Europe that doesn’t have real worries about the new populism – Because you learned your lessons so strongly and you had to think about that for nearly two generations. It is interesting to compare Germany and Austria. The Austrians were able to believe, that they had been invaded by Germany. They didn’t go through the post-war guilt that Germans underwent in a strong way. And Austria we find today is, along with Hungary and now perhaps Finland, the European country where racism is most important in politics. My generation grew up believing that at least certain things have disappeared forever, that after the awfulness of fascism, no one ever would ever want to go there again. But memories die – though they are still powerful. You still can discredit a racist populous politician by saying “you are going down the road of Hitler and you will end up building camps to put minorities in”, and you can still get a response from a public to that. But racist politics has come back in a way that is quite disturbing in almost every country. It may be about immigrants, it may be about settled ethnic groups, or just about – as you say – nationalism as a futile gesture against a globalising world. Given the weakness of other traditional social identities these kinds of ethnic and national can be very powerful – especially among people who feel that nothing in the established political system is representing them anymore.
Powision: I want to come back to one point you raised at the beginning on the financial crisis. You said we have certain positive optimistic points where you see civil movements gaining power or at least influence. On the other hand you have a certain tendency by governments in such countries –I wouldn’t say it’s causal – you have a certain tendency to engage in a forceful foreign policy, like the UK and France in Libya. This has similarities to 19th century politics where politicians engaged in foreign policy to overplay inner problems. Do today’s politicians use foreign policy to evade inner-problems in a similar way through foreign engagement or are they basically just roaming around very short-termed without a strategic impetus?
They are probably just roaming around, with short term perspectives. But that doesn’t exclude them from taking advantage of opportunities to bring glory abroad, because they can’t win it at home. Yes, the UK had this very interesting example in the early 1980s with Margaret Thatcher. At the beginning Thatcher’s policies were deeply unpopular. But managing a successful war against the Argentineans over a few bits of rock in the Falklands enabled Mrs. Thatcher to become a national heroine. You can almost say that the outcome of the Falklands war determined the fate of neo-liberalism. If she hadn’t pulled that of and had then been defeated in an election, people would have said “oh, that’s a risky path to go down”. But primarily because of the war’s, she was re-elected. There is a strong temptation of politicians to play all sorts of games in order to take people’s minds of the main problems. It might be quite dangerous, like indulging in wars; it might be relatively harmless like making sure you win the Olympic Games for your capital. Diversionary politics can take many forms and you have to expect that politicians faced with totally intractable problems are going to try and play these games. You just try to hope that they don’t play them too dangerously.
Powision: Your book on post-democracy is a critique on the actual political system, not necessarily that it is post-democracy but that it is moving towards it. And strangely enough your book has been published in the “Bundeszentrale für Politische Bildung”. This is interesting because the political system seems to absorb your criticism…
I think it is a tribute to the strength of the “Politische Bildung”-institution that they actually take up a book as critical as that shows you a lot about the strength of democracy and of political debate in Germany. One of the strengths of democracy of course is that it’s able to absorb criticism. It can be infuriating to get absorbed but if you are absorbed, you still get a bit of influence on what people are thinking. The system wants that and it knows that it needs it. The same happens in the economy with products. The systems needs challenge in order to deal with its own self-renewal. And that is part of being in a free society. Unfree societies don’t allow that to happen. That’s why eventually they become brutal and collapse. So yes, this is the irony.
Das Interview führte Alexander Mitterle (Oxford, 16. September 2011)
Crouch, C. (2011), Das befremdliche Überleben des Neoliberalismus: Postdemokratie II, Frankfurt a.M.: Suhrkamp.