What’s Next?

There is a growing sense among many that we may be on the verge of a new world order or-- to be more accurate-- at the end of an old one. Opinion polls show very low confidence in the familiar institutions of governance and high uncertainty about the economy. Voters are rejecting traditional centrists parties, with new alternative parties and movements growing in popularity. There is little or no popular consensus on the path forward and an abiding sense that matters are, in general, going badly.

The global economy is variously afflicted with inflation, stagnation, or both, and growing insecurity. Political leaders are rigidly defending the old consensus or unsuccessfully advancing “new” wrinkles on the old that go nowhere. Inequality of wealth, income, power, and outcomes grow dramatically.

Few are satisfied that we can continue in the old way, but even fewer know of a way forward.

So, it should come with little surprise that intellectuals have taken on the daunting task of describing where we are and where we might be going.

Within the broad left, two characterizations of the current “international order” have been popularized: a policy, “neoliberalism” and a process, “globalization.” Much nonsense has been written and spoken about both. As the terms grew in popularity and usage, their meaning became fuzzier and fuzzier.

There have been useful accounts of neoliberalism that place it both in an historical context and within the evolution of modern capitalism (see my discussion of Gary Gerstle’s book, The Rise and Fall of the Neoliberal Order). Gerstle, notably, gives a credible account of neoliberalism’s origins in the late 1970s and strong reasons for its fragility today.

Similarly, Branko Milanović has offered a credible account of globalization in an article that I recently reviewed. However, he dates it from 1989, when, in fact, the expansion of trade has been consistent from the establishment of the post-war global trade architecture, with qualitative leaps coming from the 1978 “opening” to China, the 1991 demise of the European socialist states, and again with China’s entry into the WTO, but followed more recently by globalization’s wane after the Great Recession of 2007-09. 

It is important not to confuse the two: neoliberalism is a political initiative that gained traction from the failings of New Deal Keynesian policy and became policy with the establishment of centrist consensus and its subscription by mainstream political parties, spreading throughout the world as dogma; globalization is an expansive process accelerated with new technologies and the migration of capital to new and expanded labor markets. While they overlap in many ways, they are different phenomena.

An even more recent participant in this discussion is Perry Anderson, writing in The London Review of Books. Contra Gerstle, Anderson sees a still-resilient neoliberalism locked in a political struggle with populism-- “The political deadlock between the two is not over: how long it will last is anyone’s guess.” 

Within the various fora of left-wing intellectuals, Anderson is a well-known, important, but controversial figure. His writing, his editorship of New Left Review, and his hand in Verso books placed him in the center of UK left intellectual life-- independent of Communist and socialist parties-- in a role similar to that played by Monthly Review in the US. Wherever Marxism rose in fashion in student and professorial circles, Anderson’s influence could be found.

The publication of Domenico Losurdo’s book, Western Marxism, in 2017 (2024 in English) placed Perry Anderson at the center of Losurdo’s critique of Euro-American trends, a critique generating much attention with the anti-imperialist left. There was certainly some merit to Losurdo’s charge that some of the “Marxism” exercised in Europe and the US was stained by Eurocentrism. Certainly, Losurdo was on to something. 

Anderson’s leftism was decidedly hostile to, real-existing-socialism-- both East and West-- and the various Communist Parties. He opted, instead, for some pure vision of socialism, a version that Marx would have scoffed at as utopian. Moreover, Anderson encouraged a left scholasticism that took young activists further and further from changing the world and more and more toward an academic career.

But the failings of the Western left lie less in any “geographical” disposition, but more centrally in the virus of anti-Communism and the disillusionment after the demise of the USSR. Gary Gerstle-- no friend of Communism-- captures it:

The collapse of communism… shrank the imaginative and ideological space in which opposition to capitalist thought and practices might incubate, and impelled those who remained leftists to redefine their radicalism in alternative terms, which turned out to be those that capitalist systems could more, rather than less, easily manage. This was the moment when neoliberalism in the United States went from being a political movement to a political order.

Ironically, Anderson concedes as much:

[Behind] neoliberalism’s apparent immunity to disgrace-- lay the disappearance of any significant political movement calling robustly either for the abolition or the radical transformation of capitalism. By the turn of the century, socialism in both of its historical variants, revolutionary and reformist, had been swept clear of the stage in the Atlantic zone.

But notice the difference. Gerstle-- the liberal-- identifies the socialist left as in retreat from socialism, with not a little suggestion that the “redefinition” was based on opportunism. There really was an alternative, despite what elites wanted us to believe.

Anderson-- the Western Marxist intellectual-- describes the retreat in the passive voice, as though there was no agency in the retreat, merely a “disappearance.” Who or what caused the “disappearance”? Who or what swept socialism clear from the stage? Did it fall from the sky?

There are no regrets of the setbacks to the socialist world. There is no remorse over the sponsorship of student rebellion over worker actions. There is no reflection on the dalliance with the renegades, malcontents, and dreamers on the margins of the left. 

Anderson writes of “the widely differing set of revolts… united in their rejection of the international regime in place in the West since the 1980s.” “What they oppose,” he asserts “is not capitalism as such, but the current socio-economic version of it, neoliberalism.” And what was the role of New Left Review in taking socialism off the table? 

Like so much of the academic left, Anderson and his colleagues were fully compliant with the post-war Western intellectual catechism: ABC – “Anything But Communism.” 

Not surprisingly, Anderson sees a bleak future: either a continuing neoliberal nightmare or an ineffective populism, possibly offering worse outcomes.

In the last few weeks, the discussion of the next international order further develops with an intervention by Professor Jeffrey D. Sachs, an establishment figure who has taken the rare enlightened position on Ukraine and Palestine. In Giving Birth to the New International Order, Sachs argues that:

The multipolar world will be born when the geopolitical weight of Asia, Africa, and Latin America matches their rising economic weight.  This needed shift in geopolitics has been delayed as the US and Europe cling to outdated prerogatives built into international institutions and to their outdated mindsets. 

Sachs endorses a view widespread on the left, a utopian view that a diverse and multi-interested group of states organized around diverse and often contradictory grievances against the reigning US-centered international order-- the BRICS alliance-- can produce “a new multilateral order that can keep the peace and the path to sustainable development.”

Almost instantly, Sachs article was met with a critical response from Dr. Asoka Bandarage, who challenges the BRICS commitment to social justice for the smaller, weaker, less powerful nations:

Unfortunately, BRICS appears to be replicating the same patterns of domination and subordination in its relations with smaller nations that characterize traditional imperial powers. Whether the world is unipolar or multipolar, the continuation of a dominant global economic and financial system based on competitive technological and capitalist growth and environmental, social and cultural destruction will fundamentally not change the world and the disastrous trajectory we are on.

Through her intimate knowledge of Indian-Sri Lankan relations, Bandarage shows how decidedly unequal power relations function even with the BRICS founders, questioning: “...would this truly represent a move towards a ‘New International Order,’ or would it simply be a mutation of the existing paradigm of domination and subordination and geopolitical weight being equated with economic weight, i.e., ‘might is right’?”

A welcome voice joins the conversation with the April 16 issue of the Morning Star. Andrew Murray-- Marxist trade union and anti-war leader-- affirms that “[t]his is a moment of transition, so we should hold firmly in our heads that the destination is not foreordained.”

Indeed.

Murray, like the others, sees neoliberalism as the current order: “a prolonged assault on working-class institutions, on the social wage and on the sovereignty of the countries of the global South, with the state receding from some of the obligations it had assumed after 1945-- the maintenance of full employment for example.” 

Unlike the others, he sees 2008 as the apogee of neoliberalism’s ascendance: 

Neoliberalism met its own Waterloo in the crash of 2008. The stagnation in living standards since has been paralleled by an intellectual stagnation of the ruling classes, unable to easily preserve the old systemic assumptions yet equally incapable of transitioning to new ones.

Murray reminds us that the previous transitions always included the socialist options, noting a fascinating quote from former French socialist president François Mitterrand-- frustrated by difficulties around the Programme commun of the Communists and Socialists-- reportedly saying “in economics there are two solutions-- either you are a Leninist or you won’t change anything.”

Until Murray’s contribution, no one even hints at a Leninist solution.

The leading oppositional candidate for a “solution” today is right populism. And we must take note of Murray’s warning: “Previous transitions have been accompanied by war, or at least violent social convulsions.”

If elites continue to cling to neoliberal dogma, “that hands the initiative to the Trumps, Le Pens and Weidels who embrace a lot of Hayek and a little of Hitler, a rhetorical dash of Roosevelt and nothing of Lenin,” concludes Murray.

Conclusion 

The growing sense that neoliberalism is a spent force, both popularly and in practice, leads to the question: “What comes next?”

Ruling circles offer only two choices:

1. Clinging to a nearly 50-year consensus of deregulation, privatization, public/private partnership (socialism for the capitalists), dismantling of social safety nets, austerity, growing inequality, and money-democracy.

2. A right-populism that postures as anti-establishment, but maintains existing unequal relations of power and wealth, employs bully-democracy, while dismantling the institutions and organizations of their opposition, and scattering their forces.

Neither choice challenges the socio-economic system that spawned both options: capitalism. Neither option serves the interest of the people.

The liberal Gerstle, the social democrat Milanović, the academic Marxist Anderson, and the multipolarista Sachs offer us a return to a disastrous neoliberalism or blind faith and hope in a yet-to-be-discovered solution. 

Only Murray offers an approach with historical antecedents and the prospect of a sharp break with capitalist malignancy.

We must remember that those who have been swayed toward right-wing populism were despairing for better alternatives. Blaming their votes when they are offered no real choice is arrogant foolishness. Better we find a real alternative.

Without another alternative emerging, the neo-nationalism of right populism-- expressed today as tariffs, sanctions, barriers (protectionism)-- will inevitably lead to war.

The only answer to an obscenely inhuman capitalism hell bent on a catastrophic path is the “Lenin” answer: socialism.

Greg Godels

zzsblogml@gmail.com

Towards a New Political Order

Of course, Putin had not manufactured Trump or his Make America Great Again movement. Trump was the homegrown product of a political order that, in the eyes of majorities of Americans, on the left and right, had failed. A neoliberal order prizing global free markets and free movement of people had left too many people behind. It had favored Wall Street over Main Street; tolerated extreme levels of inequality; ignored the problem of mass incarceration and the massive loss of wealth experienced by minority homeowners in the wake of the Great Recession; legitimized a war on Iraq that America had no business fighting and then a reckless stab at reconstruction that failed in Iraq and that spread additional misery to much of the Middle East. Distress in America had been palpable years before Trump seized America’s political stage. That a master manipulator of grievance and resentment would arise in this moment hardly seems surprising. The Rise and Fall of the Neoliberal Order

Professor Gary Gerstle, Paul Mellon Professor of American History Emeritus and Paul Mellon Director of Research at the University of Cambridge has an important new book, The Rise and Fall of the Neoliberal Order.

This is not a review of the book, however, but a critical discussion of the interesting theory elaborated in the book and the implications of that theory.

Gerstle is no Marxist. In fact, his book exhibits a common, vulgar anti-Communism and anti-Sovietism of the odious variety of Timothy Snyder and his ilk.

But Gerstle, nonetheless, takes the data of history-- revealed contemporary history-- and constructs a credible account of how these events weave together into an explanatory fabric. He proposes a theory that develops a historical thread-- liberalism-- that, should we follow it closely, will take us from the US bourgeois revolution of the late 1700s to the rise of Trump and Sanders.

This theory takes a throw-away word “neoliberalism” -- a word abused by left and right to denote a dark era of unhinged capitalism or a life-saving revival of capitalism-- and gives it both a definite meaning and a status as a politico-socio-economic order.

Where others saw neoliberalism as a disposition, a policy, or a philosophy ushered in by political change, Gerstle proposes that we view it as a definite, enduring shift based on “a distinctive program of political economy.” For Gerstle, this means that neoliberalism, as a political order, transcends the mere changes between election cycles, the shift in popular tastes, or the adoption of intellectual fashions.

The ideal-types of his theory are the twentieth-century orders of what might be called laissez faire that precede 1930, the New Deal order enduring from 1930 until 1970, and the Neoliberal Order beginning in 1970 and lasting until 2020. Gerstle is well aware that the dates are inexact markers and the transitions are not discrete, but continuous. Moreover, the dimensions of these orders are somewhat fuzzy and the transitions are uneven; neither fact detracts from the theory as a first approximation.

Insofar as the scope of Gerstle’s theory of successive political orders is primarily focused on the transition between the New Deal Order and the Neoliberal Order, his discussion of the preceding order (what he calls laissez faire) is sketchy, only sufficient to explain the conditions that gave rise to the New Deal-- that is, that necessitated a new order.

Prior to the New Deal, the dominant order celebrated free, unfettered markets, marginally regulated by a minimalist government removed from economic matters. This was the era of recovery from the First World War and its immediate post-war economic disruptions. While Europe struggled to achieve stable growth, the US became the leading industrial power. Innovative industrial organization, new marketing and financial schemes, and intensifying concentration made the US the driving force of this order. Perhaps unfairly, this era is associated with the fulsome, but ultimately misplaced optimism of US President Herbert Hoover.

The New Deal Order

Of course, the fragility of this order was brought forward by the stock market crash in the fall of 1929. The story of the subsequent Great Depression is often told and Gerstle adds little to it. But he does frame it as the factor bringing the old order down and paving the way for a new one. The instability, the hardships, the uncertainties spawned by an unparalleled economic crisis called the laissez faire order into question, rocking the very foundations of capitalism. Moreover, the example of an emerging, but radically different order-- socialism-- loomed threateningly over the shaken foundations.

The rise of a new order answering to the failure of the previous one came through the vehicle of the Roosevelt administration, though Gerstle would acknowledge that the leaders, ideas, and movements driving the new order were incubating far earlier.

The features of the New Deal order are well known. Most importantly, it assigned a central role to the government. That is, the government was unleashed to design programs, fund initiatives, employ the unemployed, initiate projects and enterprises, goad, regulate, and discipline business, and intercede in virtually every other aspect of life.

The construction of the new order was far more complex than a change of administration. It involved vital, militant movements in labor, agriculture, small business, and political forces beyond the two parties. It was shaped over time, with setbacks and retreats.

Gerstle does not fear designating events as cardinal in the transition from one order to another:

General Motors capitulated in March 1937, as did the Supreme Court, which voted by the slimmest of margins (5-4) to uphold the constitutionality of the congressional act that created the new system of labor relations. At that moment (March 1937), laissez-faire in America lost whatever was left of its moral and jurisprudential hold on American politics.

A key ideological building block of the New Deal was the idea that government was an anchor for shaping economic life with a role in conditioning social life as well. While this is today often associated with the economic doctrines of John Maynard Keynes, Gerstle recognizes that the New Deal was crafted before Keynesianism was deeply rooted.

After World War II, the New Deal order consolidated. For Gerstle, the final ascension of a new order is established when its opponents-- the former advocates of the old order-- embrace it. Gerstle finds that victory embodied in the administration of Dwight Eisenhower. While Eisenhower paid lip service to the old Republican vérités of laissez faire, he and the majority of his party ruled in step with the principles of the new order (many astute historians note that governance during the Nixon years were likewise more “liberal” than during the subsequent rule of later Democratic Party liberals).

The dynamic of this mature version of the New Deal order was driven by the fear of Communism, just as its rise was forged by fear of the Communist alternative to the 1930s collapse of capitalism. Gerstle sees anti-Communism as the gravity pulling political parties together in a common crusade.

The post-war reorganization of the New Deal paralleled the Cold War. In Gerstle’s words: “The Cold War, then, secured the New Deal order.”

The purging of the Communist left and its Popular Front allies from political and social life was an essential element in establishing the New Deal consensus.

For labor, a trade-off was constructed-- labor surrendered militancy, internationalism, and social justice while embracing business unionism and, in return, capital granted wage and benefit growth commensurate with productivity increases, job protection, and longer contracts. A template for this consensus was the UAW’s so-called treaty of Detroit.

To combat the Cold War over racism and colonialism, the New Deal consensus began to set the conditions for the dismantling of US segregation and the worst features of its apartheid racial regime. Gerstle does a thorough and able job of explaining these profound changes in terms of the competition with Communism. Brutal US race policies were a constant embarrassment to the US ruling class in an era of decolonization.

Anchored in the government’s support of Brown versus Board of Education, the New Deal order sought to build a new image of racial harmony that in some ways encouraged, but could not contain the popular movement for civil rights and against racism.

Likewise, the New Deal order coalesced around militant anti-Communism in foreign relations, aggressively meeting, overtly or covertly, Communist gains anywhere and everywhere in the world. The demands of a domestic war on poverty, especially Black poverty, and policing the world against Communism would prove too much of an economic burden for the order, a burden that would play a big role in the fall of the New Deal Order.

The 1970s proved to be the fatal decade for the New Deal order. A particularly pernicious species of economic crisis-- stagflation-- plagued the era. The unprecedented combination of stagnant, even slacking economic growth and high inflation overwhelmed the Keynesian tools favored by the New Deal order.

Intense competition from countries devastated by World War II-- earlier weaned from left-wing influence by the Marshall Plan and other aid packages-- now pressured US corporate profit rates with their technologically superior, cost-savings industries. US monopolies found their home market invaded with cheaper, often superior products. Thus, the economic crisis hurt corporations as well as working people. Mills and plants closed, stripping workers of good paying jobs, especially in the Midwest.

The decade also brought social and political crises with the defeat of the US military in Vietnam and the scandals associated with President Richard Nixon’s criminal actions and forced resignation.

The Neoliberal Order

The fatal decade ended with the election of Jimmy Carter, a relatively unknown Southerner, who Gerstle considers to be a transitional figure towards a new order-- Neoliberalism. Carter did indeed anticipate Reagan with his distrust of government and urge to deregulate. In perhaps one of the more controversial of Gerstle’s claims, he locates the roots of Carter’s departure from New Deal policies in his association with Ralph Nader. Both viewed the government “not as a tool for restoring democracy but as an instrument of corporate domination and bureaucratic drift.” Given the penetration of capital into every nook and corner of the state-- what Marxists call “State-Monopoly Capitalism” -- the Carter/Nader thesis is not far-fetched. Gerstle sees this as the beginnings of left-neoliberalism, a theme that he returns to again and again.

Gerstle suggests three critical reasons that the commanding corporate heights-- including many capitalists who had made their peace with the New Deal-- were ready for a new order, an order to be realized beginning with the election of Ronald Reagan:

1. “First, the American economy performed poorly for much of the 1970s, its reputation for global preeminence now tarnished, the instruments in the Keynesian toolkit stiff and rusty.” The blow to profitability in key industries long dominated by US monopolies challenged capital to find new answers.

2. “Second, the sharp escalation of foreign goods invading the US marketplace made many in corporate ranks less willing to tolerate the power of organized labor.” The intense competition with low wage, modernized industries in West Germany and Japan brought class peace-- secured by compromises like the Treaty of Detroit-- to an end. Henceforth, capital would be on the offensive against labor.

3. “...unhappiness about the steady creep of government regulations that neither the recession of the 1970s nor the political leadership of America… seemed capable of stalling or reversing.” New Deal regulation was meant to protect capitalism from itself by dampening insurrectionary waves through the enhancements of the welfare state and by stifling capital’s self-destructive impulses. By the 1970s, the Great Depression and the system’s collapse seemed far off and improbably recurring to the captains of industry.

As with the New Deal and its identification with the Roosevelt election, the Neoliberal order became identified with the Reagan election, but the ideas and movements associated with Neoliberalism incubated much earlier.

Gerstle points to the post-war creation of the Mt. Pelerin society, a proto-think tank of free-marketeers who helped shape and popularize the ideology of Neoliberalism. Their members brought the idea of extending markets to all aspects of life. Further, they subscribed to a fetish-like ascription of personal freedom to every question.

He overlooks the contemporaneous development of a new social science based upon Kenneth Arrow’s pioneering work and the Rand Corporation’s application of it to strategic and military matters. Rational Choice theory and Game Theory became the intellectual foundations for Neoliberalism, a development brilliantly developed by S. M. Amadae in her neglected work, Rationalizing Capitalist Democracy.

In the 1970s, an infamous memo circulated by future Supreme Court justice, Lewis Powell, served to alarm corporate leaders to the new “dangers” posed to capitalism by the New Deal order.

Since the debacle of the Goldwater campaign in 1964, an ideologically fueled series of think tanks had risen to construct alternatives to New Dealism. Funded by right-wing figures like Joseph Coors, John M. Olin, and the Koch brothers, these institutions substituted intellectual gravitas for the previously conventional ultra-right rants and conspiracy theories. Figures like Paul Weyrich, George Gilder, and William Simon carried the messages forward. Thus, was built a Neoliberal intelligentsia to counter the New Deal establishment. Gerstle explains:

The constituent parts of this order-- the capitalist donors, the intellectuals, the think tanks, the politicians, the media, and the personal networks linking them together-- were all visible in the 1970s. The speed with which the neoliberal order implanted itself on politics in the 1980s is inconceivable without what we might call the “silent phase” of its construction.

Reaganism quickly implemented and shaped the rudiments of a Neoliberal order, laying waste to the existing regulatory regimen and dismantling the progressive-tax structure. The Reaganaut attack on the judiciary laid the foundation for the rigid “original intent” silliness that dominates the courts today.

The overthrow of the media’s Fairness Doctrine in 1987 removed the last vestige of the media’s pretense to political impartiality and opened the door to the further influence of wealth and power.

Despite the rhetoric, Reaganism was not about budget busting or small government. Government spending for the military grew at an unprecedented peace-time rate. Federal debt reached new heights.

And the roots of the carceral state-- the filling of the jails with poor, often Black youth-- are to be found in the Reagan years and became a signature feature of Neoliberalism.

The fall of the Soviet Union in 1991 further consolidated Neoliberalism. Gerstle recounts the results of the end of Soviet power:

One result of communism’s fall is obvious: It opened a large part of the world… to capitalist penetration… capitalists and capital poured into Eastern Europe… After 1991, no country or movement in the world was in a position… to challenge the capitalist way of organizing economic life. Perhaps, then, there was no longer a need for capitalists to purchase insurance against such challenges by paying American workers the high wages that the New Deal order demanded. To the contrary, high wage insurance policies could be dropped and labor protests against wage cuts ignored or met by threats to ship production abroad. The defenders of this hyper-globalized capitalist order argued that whatever American workers lost in wages would be counter-balanced by falls in the cost of consumer products now manufactured abroad for a fraction of their former costs…It is hardly surprising that economic inequality rose sharply in these circumstances, to pre-New Deal levels.

Gerstle understands a consequence of the fall of the Soviet Union upon the left-- the real left, the radical left-- that few acknowledged then or now:

The collapse of communism… shrank the imaginative and ideological space in which opposition to capitalist thought and practices might incubate, and impelled those who remained leftists to redefine their radicalism in alternative terms, which turned out to be those that capitalist systems could more, rather than less, easily manage. This was the moment when neoliberalism in the United States went from being a political movement to a political order. [my emphasis]

By the mid-1980s, many Democrats had gravitated towards Neoliberalism. A beachhead was firmly planted in the Democratic Party with the founding of the Democratic Leadership Council. Prominent Democrats like Paul Tsongas, Gary Hart, Bill Bradley, Michael Dukakis, Al Gore, and Bill Clinton were drawn into the arms of Neoliberalism (old New Dealers like Tip O’Neill and Ted Kennedy were less easily seduced).

If Eisenhower’s presidency signaled the Republican surrender to the New Deal order, then Clinton’s presidency did the same for the Democrats' surrender to Neoliberalism.

Certainly, the victory of Bill Clinton in the 1992 presidential election sealed the capture of the Democratic Party, but the process began earlier. Market-based solutions to social problems attracted some Democrats engaged in “The War on Poverty.” Gerstle, again, locates left-wing roots of Neoliberalism in the Nader campaign for “consumer sovereignty” and the frustration with regulation as a solution to corporate abuse.

Of course, part of the Democratic Party surrender was pure opportunism-- Reagan’s revolution held power for twelve years, so they felt that they must give up the fight and join them.

Gerstle recognizes another factor: “the giddiness that accompanied the information technology (IT) revolution.” Infatuated with “tech hipsters,” the Democrats saw the new tech industry titans-- often libertarians and free marketeers-- as creators of a new market-based era. The pundits of the new era-- Esther Dyson, George Gilder, George Keyworth, and Alvin Toffler-- preached a renewal of “the American Dream.” Toffler “framed the revolution in terms of ‘Third Wave’ innovation.”

The seduction of these techno-libertarians and futurists was pervasive. This wedded the Democrats to Wall Street investors backing the tech phenomenon and moved politicians like Al Gore towards a reinvented, less intrusive government which would be more agreeable to a “third wave” economy.

The Telecom Act of 1996 completed the liberation of media and communication from non-partisanship and diversity, as media consolidated into the hands of a few mega-corporations that are producing the vulgarity, sensationalism, and conformity that exists today.

The Clinton era’s Gramm-Leach bill performed a similar function, liberating the financial industry from restrictions imposed in the 1930’s, enabling the economic crises of 2000-2001, 2007-2009, and that of today.

Despite unanimity on the core values of Neoliberalism, the two parties split on social values. Nonetheless, as Gerstle explains: ”The contrasting cultures embraced by the two parties-- cosmopolitanism in the case of the Democrats, neo-Victorianism in the case of the Republicans-- were both compatible with the ascendant political economy.” With consensus on political economy, culture-- including identity issues-- became the battleground for political discourse in the twenty-first century.

The Clinton decade was the triumphant highpoint of Neoliberalism; its decline began in the early years of the twenty-first century.

Neoliberal foreign policy became a disaster with military adventures in the Middle East and elsewhere. The idea that the US was the international police and responsible for imposing Neoliberal values, free markets, cultural and political values-- in other words, a Neoliberal civilizing mission-- fell apart before resistance in Afghanistan, Iraq, and elsewhere. Gerstle writes of US “hubris” -- a proper term for the US’s Neoliberal missionary role in imposing the order’s infrastructure on the entire world.

Nothing exhibits its failure better than the two-decade-long war in Afghanistan, a failure that pitted history’s greatest military against a guerilla army of a pariah movement rooted in feudal social and political ideologies.

Nothing demonstrates the arrogance of Neoliberalism more than the failure to remake Iraq in the Neoliberal image.

Gerstle tells these familiar stories well.

Likewise, Neoliberal hubris was demonstrated domestically. The first two decades of the new century were rocked by two serious economic crises, a devastating, poorly managed viral pandemic, and a third unfolding economic crisis. Neoliberalism’s response to all four was devastating to millions of people, yet the political order sheltered-- even enriched-- the wealthy and powerful. Hubris, indeed.

Credibly, Gerstle sees the political rise and election of Barack Obama as Neoliberalism’s last political hurrah. Obama may have been perceived as a champion of the people with new ideas, but he was, in fact, a fireman for the Neoliberal order charged with extinguishing the greatest economic challenge since The Great Depression. Insofar as he did so, he did it with the partisans and tools of that now-shaky order.

Gerstle writes:

In the aftermath of the Great Recession, globalization and neoliberalism could no longer be promoted as policies that lifted all boats. Techno-utopianism could no longer hide the truth that serious structural imbalances in the global economy threatened not to collapse economies but to rend the social fabric of nations. The economic hardship and distress caused by the crash would linger for years. Political anger would smolder for a time and then erupt into a series of whitehot insurgencies. The neoliberal order would not be able to stand the heat.

The group that had benefited most from the New Deal order-- whites in the small Midwestern towns and in the industrial pockets spread across the US became big losers with the Neoliberal order. Premature deaths, alcoholism, suicide, drug addiction-- the usual afflictions of the poor and neglected-- were now the common afflictions of the unemployed, underemployed, discouraged workers that had loyally celebrated and trusted capitalist rule.

Gerstle chose a 2012 study of a largely white Philadelphia neighborhood to illustrate the despair wrought by Neoliberalism, despite the fact that its author, Charles Murray, would likely be the last person to blame the order for the plight of those in Fishtown.

Of course, the Neoliberal order was even less kind to the Black working class, a demographic that always was the first and hardest hit with the economic crises. African American home ownership and household wealth were devastated in the aftermath of the 2007-2009 crisis.

The Neoliberal answer to despair was the imprisonment of more people proportionally than any other country, a harsh solution that fell especially hard on Black people because of the racist criminal justice system.

Perhaps the statistic most telling of the end-state crisis of Neoliberalism is life expectancy. The average US life expectancy dropped for the first time in the four-year period between 2014 and 2018. Of course, the drop is even greater for Blacks and Latinas/Latinos.

And of course, inequality in the US has reached levels unseen since the Great Depression.

Gerstle recounts the emergence of popular movements against Neoliberalism, both left and right. The Tea Party marked a backlash against the Neoliberal, corporate Republicans who lead the party. Wealthy rightwingers like the Koch brothers used their financial might to channel the movement into cultural directions and away from any serious economic critique, but its core attraction remained a hazy anti-elitism.

The left had its own uprising with the unexpected rise of the Occupy Wall Street movement. Undoubtedly, its surprising appeal sprung from its direct and unambiguous outrage at inequality expressed by the attack on the 1%. Gerstle explains: “In the short term, organizational chaos and indecision resulted from the movement’s anarchist-inflected resistance to having formal leaders.” Nonetheless, the experience led to hordes of young people entering electoral politics in protest, most eventually nesting in the Bernie Sanders campaign to convert the Democratic Party into the social democratic vehicle that it never really was.

Sanders garnered considerable support in both his runs for the US presidency. Given the growing dissatisfaction with the Neoliberal order, it should come as no surprise that he did well in the Democratic primaries, where his outlier counterpart, Donald Trump, also did well, given their common vocal rejection of the Neo-liberal order. But the dominant Democratic Party Neoliberals were successful in knee-capping Sanders in both campaigns.

Trump was more successful, shocking everyone that he emerged as a candidate, shocking everyone that he won the primary, and further shocking everyone that he actually won the election in 2016.

Putting aside Trump’s checkered, volatile rule during his four years, Trump exists as the product of rejectionist populism. And whether voters understand the essence of what they are rejecting, the political and economic substratum spurring that rejection is Neoliberalism. Whether Trump, an ideological slippery creature, represents any commonality with the grievances of most of his electoral supporters, he stands against something and he has convinced many that it is what they are against as well.

Like Sanders, whose supporters think they understand how he will secure the changes needed, Trump is the standard bearer for a movement looking to defeat the old order.

The new order is yet to emerge.

The New Deal order sold a large majority of Americans that a strong central state could manage a dynamic, but dangerous capitalist economy in the public interest. The neoliberal order persuaded a large majority of Americans that free markets would unleash capitalism from unnecessary state controls and spread prosperity and personal freedom throughout the ranks of Americans and then throughout the world. Neither of these propositions today commands the support or authority that they once possessed. Political disorder and dysfunction reign. What comes next is the most important question the United States, and the world, now face. The Rise and Fall of the Neoliberal Order

Assessing Gerstle’s Theory

Like the celebrated academic wealth and income expert, Thomas Piketty, before him, Gerstle is not a radical in any sense. Piketty’s empirical work unintentionally revealed what Marxist theory had long deduced: the tendency, over time, for capitalism to produce and reproduce inequality-- it is in its DNA. His results, upon further study, moved him leftward, though he remains distant from being a Marxist.

Gerstle, an academically esteemed historian, has made a uniquely thorough study of the political, social, and economic history of the United States in the modern era. Like any good historian, Gerstle searches for patterns, commonalities, and trends when he places the facts of history next to each other. Despite his solid mainstream credentials, his review of the last hundred years of US history surfaces a theory of the evolution of US capitalist society that is strikingly similar to what a Marxist might accept.

1. Gerstle sees history unfolding between 1930 and today as a dynamic process of different regimes trying to manage the US economy by establishing a widespread consensus around a specific capitalist ideology, a set of policies, and a core constituency. These regimes, when successful, become a political order.

2. Insofar as the practice of the new order stabilizes capitalism, promotes the advance of capital, and sustains or raises the profitability of capital, it is widely accepted and retains the loyalty of elites. In the case of the US, the elites voice their consensus through the subscription of the two major parties.

3. When capitalism becomes unstable, the existing order comes into question.

4. In the face of crises, pre-existing factions within the old order question the existing consensus and shift their allegiance to another political order.

5. A vigorous struggle ensues to determine a successor order to the failed one, usually decided in the electoral contests.

6. The winner enjoys the opportunity to stabilize US capitalism and establish a new order.

As competently as Gerstle organizes and establishes this sequence of events into a coherent theory of political motion, he hesitates to attribute it to the inherent instability of capitalism. He clearly finds the US unstable to the point that-- every thirty or forty years-- the old political order decays and necessitates rescue by a new order. He clearly sees that the new order, while initially enjoying some success, carries the seeds of its own demise. Yet he never asks why this instability arises so frequently and what might be its cause.

This failure to seek ultimate causes is peculiar because Gerstle shows that he is fully aware of the significance of Communism as “capitalism’s most ardent opponent.” He acknowledges: “Generally missing from studies of the international roots and reach of neoliberalism… is a reckoning with the Soviet Union and communism more generally. And yet, this book argues, the Soviet Union and international communism cannot be ignored. Few international events in the twentieth century matched the Russian Revolution of 1917 in importance.”

While Gerstle sees successive political orders as threatened by Communism, he fails to concede that the credibility of that threat is precisely because capitalism is inherently unstable, therefore potentially unpopular, and ripe for rejection. His anti-Communism blinds him to take that step.

While Gerstle affirms that “no other single political force [than Communism and anti-Communism] had a comparable influence on the world or American politics across the twentieth century,” one must wonder if he really understands the full consequences of this affirmation. The construction of US anti-Communism as a veritable religion stains virtually every aspect of life and thought in the US to this day, including the building of alternatives for the creation of a new political order.

Since Gerstle confines his study mostly to the US, he fails to recount how the US political orders he exposed-- laissez faire, The New Deal, and Neoliberalism-- spread like a virus throughout the capitalist world in their time. Margaret Thatcher-- considered a co-henchwoman of Neoliberalism with Ronald Reagan-- has only two brief references in the book.

But the very fact that these political orders became a feature of global capitalism and not limited to individual states surely demonstrates that their dynamic is generated from capitalism and not anything peculiar to the US or the UK. The Neoliberal political order, like its antecedents, was adaptive in the Darwinian sense, for the survival of global capitalism.

Gerstle’s theory suggests a weak, but definite sense of irreversibility-- the laissez faire order of the early twentieth century was spent; it could not solve the contradictions of the 1930s; nor could it return to solve the contradictions of the 1970s (though it shared features with Neoliberalism).

The New Deal order of the 1930s was also spent; it could not solve the contradictions of the 1970s; nor can it solve the contradictions of Neoliberalism (though elements of it may appear in Neoliberalism’s successor).

And Neoliberalism-- as we know it-- will not return in the future, but, if we fail to break the cycle with socialism, an order may emerge with some of its features.

Of course, this is neither inevitability nor fatalism. As Engels reminds us-- and it is particularly apt today-- another option is that society could simply perish. But within the bounds of twenty-first century capitalism, Gerstle is arguing that Neoliberalism is spent and its replacement as a political order is yet to be decided. He leaves no doubt of his conclusion when he ends his book with the charge that determining the next political order “is the most important question the United States, and the world, now face.”

But political orders do not arise from nothing; nor do they prevail arbitrarily. Gerstle shows in his narrative of the rise and fall of orders that antagonistic political currents percolate in the recesses of the existing order, preparing to vie for succession when the dominant political order falters. The balance of social and political forces determines the successor political order, typically fought out on the electoral field-of-play in the advanced capitalist countries.

Despite the neat dynamic of Gerstle’s theory, one senses that we have arrived at a crossroads. Certainly, the theory accounts for the rise of Trumpism (and its global right-wing, populist counterparts in the UK, the Baltics, Poland, Hungary, India, etc.) as a logical development from the decline of the Neoliberal order and a desperate attempt to establish a new counter-Neoliberal order. But what are the other alternatives?

Absent from Gerstle’s account is the widespread collapse of the center-left and center-right parties that historically resolved the transition to a new order. In most advanced capitalist countries, they have been electorally marginalized or racked with division and factionalism. They no longer serve as the guarantee of transitional moderation, nor have they escaped the clutches of Neoliberalism.

For the US, Gerstle only projects Bernie Sanders and his quasi-New Dealism as both a response to Neoliberalism and an alternative to Trumpism. However, Sanders refuses to break with the solidly Neoliberal Democratic Party, a party that has twice demonstrated its obstinate refusal to accept Sanders' program.

Thus, at this moment, from the perspective of Gerstle’s theory, the only viable alternative that has emerged to Neoliberalism is the right-wing populism associated with Trump. Sadly, Gerstle, like much of our left, cannot imagine escaping the succession of political orders that strive to rescue and manage capitalism.

“…the most important question… [we] now face.”

It was not so long ago that Rosa Luxemburg’s famous comment-- “Bourgeois society stands at the crossroads, either transition to Socialism or regression into Barbarism” -- resonated with millions of people, including many in the Western capitalist countries. Today, that is not so.

Gerstle explains why this has come to be. The setback to international socialism that came with the demise of the Soviet Union in 1991 ushered in an era when leftists would “redefine their radicalism in alternative terms, which turned out to be those that capitalist systems could more, rather than less, easily manage.” [my emphasis]

With some high drama, he adds: “This was the moment when neoliberalism in the United States went from being a political movement to a political order.”

With this, Gerstle is astonishingly insightful, though the Neoliberal order has blocked his imagination as well. Neoliberalism has effectively stunted the radical imagination, leaving the vision of socialism to a small, but determined minority.

In place of politics driven by a vision of socialism-- the end of the exploitation of labor and its attendant injustices-- Neoliberalism has cultivated an era of political cynicism and overwrought moral outrage. As Gerstle observes, what counts as leftism today fits neatly into what capitalism allows: reforms that fail to challenge not only the relations between capital and labor, but even the balance of power between the capitalists and the rest of us; a fetish of capitalist democratic procedure which projects that-- should all the obstacles to popular participation be removed-- the interests of the people will magically be recognized and satisfied by the ruling apparatus; and an absorption with an adolescent notion of freedom that celebrates the individual not of the collective, but outside of it.

Today’s left, coloring inside the lines of what capitalism allows, would be aghast at the idea of revolutionary socialism. Better to talk of local politics, humanizing the Democratic Party, small-scale cooperatives, human rights campaigns, non-profit corporations, foundations, expanded welfare, democracy promotion projects, networks of progressive interest groups, etc., etc. All relatively inoffensive to the Neoliberal order and unthreatening to capitalism.

Today’s left makes angry noises about the threat of fascism, dangers to “our” democracy, and the rise of right-wing populism without acknowledging that all are the children of capitalism. It is, and has been, capitalism that fears the rising of the people and seeks to disable the tools that enable the people to rise. Defending capitalism from itself will not secure a bright future for working people.

Let us suppose that Gersle is right-- and I think he is-- that we are at a crossroads where one political order is dying and another is yet to take its place. What does that mean for the left?

In past transitions from one order to another, the specter of Communism was a decisive factor in shaping the new political order, as Gerstle concedes. The New Deal would not have taken the form it did without a powerful left formed around militant working-class organizations, especially the Communist Party. A workers’ state did not ensue, but a political order that conceded far more to working people than it would have without the socialist alternative looming.

In the transition to Neoliberalism, the specter played a negative role. The advances of Communism-- victories in Asia, Africa, and even in Latin America, with Communist Parties enjoying greater influence in global politics-- shocked capitalist elites and rocked the economically shaky New Deal order, hastening the rise of Neoliberalism.

Today, the lack of a militant left committed to advancing socialism stunts any attempt to establish a new political order that will both rival the hollow posturing of left and right populism and answer the unprecedented challenges facing the world today.

As insightful as Gerstle’s theory is, it suffers a failure of imagination. Understandably, he and many others fear what will succeed Neoliberalism. The prospects of managing capitalism are growing dim. It's time to look beyond rescuing a failing, rotten system; it’s time to build a movement for socialism.

Greg Godels

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