Mar 5, 2023
The rise of China and the Chinese path to modernization post challenges to the West. Is there a crisis of the model of democratic capitalism? What are the way out from the points of view of Western thinkers? Prof. Dr. Tang Zhimin, Director of CASPIM, reviews 4 new books published early this year:
Liberal democracy is in recession, and authoritarianism is on the rise. The ties that ought to bind open markets to free and fair elections are threatened, even in democracy’s heartlands, the United States and England. Martin Harry Wolf CBE, the chief economics commentator at the Financial Times, made a case in his new book: The Crisis of Democratic Capitalism.
The ailing condition was first manifested on the economic side. In his recent New York Times bestseller, It’s OK to Be Angry About Capitalism, Senator Bernie Sanders speaks blunt truths that capitalist status quo has enriched millionaires and billionaires at the expense of the working class. Between 1978 and 2018, CEO pay skyrocketed by more than 900%, he quoted, while worker pay grew by just under 12%, (report of Economic Policy Institute).
His view echoed an earlier book by Jonathan B. Baker, a former Director of the Bureau of Economics at the Federal Trade Commission, The Antitrust Paradigm. It reveals large businesses increasingly profit by taking advantage of their customers and suppliers. In the era of AI, these firms can also use sophisticated pricing algorithms and customer data to secure substantial and persistent advantages over smaller players. They became Standard Oil and U.S. Steel in our new Gilded Age.
The ugly economics is mirrored in the political system and intellectual root. Sanders criticized a system that is fueled by uncontrolled greed and rigidly committed to prioritizing corporate profits over the needs of ordinary Americans. In The Big Myth: How American Business Taught Us to Loathe Government and Love the Free Market, two American historians, Oreskes and Conway, detail the ploys that turned Friedrich von Hayek and Milton Friedman into household names, and established the new American orthodoxy across Republican and Democratic administrations over half a century: down with “big government” and up with unfettered markets.
In his book, Sanders offers a solution to embrace a kind of New Deal liberalism of President Franklin Delano Roosevelt — in particular, FDR’s insight that “true individual freedom cannot exist without economic security and independence.
Richard Nathan Haass, an American diplomat, took one step further to the arena of ideology in The Bill of Obligations: The Ten Habits of Good Citizens: We must re-envision citizenship if American democracy is to survive, place obligations on the same footing as rights. This reminds us of the teaching of Michael J. Sandel, a prominent American political philosopher and professor at Harvard Law School. In Public Philosophy published nearly twenty years ago, he reminds us that the most prominent ideals in our political life–individual rights and freedom of choice–do not by themselves provide an adequate ethic for a democratic society. A politics is called for that gives greater emphasis to citizenship, community, and civic virtue.
Bibliography
Jonathan B. Baker (2019): The Antitrust Paradigm: Restoring a Competitive Economy. Cambridge, Harvard University.
Richard Haass (2023): The Bill of Obligations: The Ten Habits of Good Citizens. London,Penguin.
Naomi Oreskes and Erik M. Conway {2023): The Big Myth: How American Business Taught Us to Loathe Government and Love the Free Market. London, Bloomsbury.
Michael J. Sandel (2006): Public Philosophy: Essays on Morality in Politics. Cambridge,Harvard University.
Bernie Sanders (2023): It’s OK to Be Angry About Capitalism. New York, Crown.
Martin Wolf (2023): The Crisis of Democratic Capitalism. London, Penguin