Neoliberalism has brought out the worst in us

An economic system that rewards psychopathic personality traits has changed our ethics and our personalities

• 
• • Paul Verhaeghe
  • theguardian.com, Monday 29 September 2014 09.00 BST

'We are forever told that we are freer to choose the course of our lives than ever before, but the freedom to choose outside the success narrative is limited.' Photograph: Lefteris Pitarakis/AP

We tend to perceive our identities as stable and largely separate from outside forces. But over decades of research and therapeutic practice, I have become convinced that economic change is having a profound effect not only on our values but also on our personalities. Thirty years of neoliberalism, free-market forces and privatisation have taken their toll, as relentless pressure to achieve has become normative. If you’re reading this sceptically, I put this simple statement to you: meritocratic neoliberalism favours certain personality traits and penalises others.

There are certain ideal characteristics needed to make a career today. The first is articulateness, the aim being to win over as many people as possible. Contact can be superficial, but since this applies to most human interaction nowadays, this won’t really be noticed.

It’s important to be able to talk up your own capacities as much as you can – you know a lot of people, you’ve got plenty of experience under your belt and you recently completed a major project. Later, people will find out that this was mostly hot air, but the fact that they were initially fooled is down to another personality trait: you can lie convincingly and feel little guilt. That’s why you never take responsibility for your own behaviour.

On top of all this, you are flexible and impulsive, always on the lookout for new stimuli and challenges. In practice, this leads to risky behaviour, but never mind, it won’t be you who has to pick up the pieces. The source of inspiration for this list? The psychopathy checklist by Robert Hare, the best-known specialist on psychopathy today.

This description is, of course, a caricature taken to extremes. Nevertheless, the financial crisis illustrated at a macro-social level (for example, in the conflicts between eurozone countries) what a neoliberal meritocracy does to people. Solidarity becomes an expensive luxury and makes way for temporary alliances, the main preoccupation always being to extract more profit from the situation than your competition. Social ties with colleagues weaken, as does emotional commitment to the enterprise or organisation.

Bullying used to be confined to schools; now it is a common feature of the workplace. This is a typical symptom of the impotent venting their frustration on the weak – in psychology it’s known as displaced aggression. There is a buried sense of fear, ranging from performance anxiety to a broader social fear of the threatening other.

Constant evaluations at work cause a decline in autonomy and a growing dependence on external, often shifting, norms. This results in what the sociologist Richard Sennett has aptly described as the “infantilisation of the workers”. Adults display childish outbursts of temper and are jealous about trivialities (“She got a new office chair and I didn’t”), tell white lies, resort to deceit, delight in the downfall of others and cherish petty feelings of revenge. This is the consequence of a system that prevents people from thinking independently and that fails to treat employees as adults.

More important, though, is the serious damage to people’s self-respect. Self-respect largely depends on the recognition that we receive from the other, as thinkers from Hegel to Lacan have shown. Sennett comes to a similar conclusion when he sees the main question for employees these days as being “Who needs me?” For a growing group of people, the answer is: no one.

Our society constantly proclaims that anyone can make it if they just try hard enough, all the while reinforcing privilege and putting increasing pressure on its overstretched and exhausted citizens. An increasing number of people fail, feeling humiliated, guilty and ashamed. We are forever told that we are freer to choose the course of our lives than ever before, but the freedom to choose outside the success narrative is limited. Furthermore, those who fail are deemed to be losers or scroungers, taking advantage of our social security system.

A neoliberal meritocracy would have us believe that success depends on individual effort and talents, meaning responsibility lies entirely with the individual and authorities should give people as much freedom as possible to achieve this goal. For those who believe in the fairytale of unrestricted choice, self-government and self-management are the pre-eminent political messages, especially if they appear to promise freedom. Along with the idea of the perfectible individual, the freedom we perceive ourselves as having in the west is the greatest untruth of this day and age.

The sociologist Zygmunt Bauman neatly summarised the paradox of our era as: “Never have we been so free. Never have we felt so powerless.” We are indeed freer than before, in the sense that we can criticise religion, take advantage of the new laissez-faire attitude to sex and support any political movement we like. We can do all these things because they no longer have any significance – freedom of this kind is prompted by indifference. Yet, on the other hand, our daily lives have become a constant battle against a bureaucracy that would make Kafka weak at the knees. There are regulations about everything, from the salt content of bread to urban poultry-keeping.

Our presumed freedom is tied to one central condition: we must be successful – that is, “make” something of ourselves. You don’t need to look far for examples. A highly skilled individual who puts parenting before their career comes in for criticism. A person with a good job who turns down a promotion to invest more time in other things is seen as crazy – unless those other things ensure success. A young woman who wants to become a primary school teacher is told by her parents that she should start off by getting a master’s degree in economics – a primary school teacher, whatever can she be thinking of?

There are constant laments about the so-called loss of norms and values in our culture. Yet our norms and values make up an integral and essential part of our identity. So they cannot be lost, only changed. And that is precisely what has happened: a changed economy reflects changed ethics and brings about changed identity. The current economic system is bringing out the worst in us.

Sick of this market-driven world? You should be

The self-serving con of neoliberalism is that it has eroded the human values the market was supposed to emancipate

• 
• • George Monbiot
  • The Guardian, Tuesday 5 August 2014 21.05 BST

‘The workplace has been overwhelmed by a mad, Kafkaesque infrastructure ... whose purpose is to reward the winners and punish the losers.’ Photograph: REX/High Level

To be at peace with a troubled world: this is not a reasonable aim. It can be achieved only through a disavowal of what surrounds you. To be at peace with yourself within a troubled world: that, by contrast, is an honourable aspiration. This column is for those who feel at odds with life. It calls on you not to be ashamed.

I was prompted to write it by a remarkable book, just published in English, by a Belgian professor of psychoanalysis, Paul Verhaeghe. What About Me? The Struggle for Identity in a Market-Based Society is one of those books that, by making connections between apparently distinct phenomena, permits sudden new insights into what is happening to us and why.

We are social animals, Verhaeghe argues, and our identities are shaped by the norms and values we absorb from other people. Every society defines and shapes its own normality – and its own abnormality – according to dominant narratives, and seeks either to make people comply or to exclude them if they don’t.

Today the dominant narrative is that of market fundamentalism, widely known in Europe as neoliberalism. The story it tells is that the market can resolve almost all social, economic and political problems. The less the state regulates and taxes us, the better off we will be. Public services should be privatised, public spending should be cut, and business should be freed from social control. In countries such as the UK and the US, this story has shaped our norms and values for around 35 years: since Thatcher and Reagan came to power. It is rapidly colonising the rest of the world.

Verhaeghe points out that neoliberalism draws on the ancient Greek idea that our ethics are innate (and governed by a state of nature it calls the market) and on the Christian idea that humankind is inherently selfish and acquisitive. Rather than seeking to suppress these characteristics, neoliberalism celebrates them: it claims that unrestricted competition, driven by self-interest, leads to innovation and economic growth, enhancing the welfare of all.

At the heart of this story is the notion of merit. Untrammelled competition rewards people who have talent, work hard, and innovate. It breaks down hierarchies and creates a world of opportunity and mobility.

The reality is rather different. Even at the beginning of the process, when markets are first deregulated, we do not start with equal opportunities. Some people are a long way down the track before the starting gun is fired. This is how the Russian oligarchs managed to acquire such wealth when the Soviet Union broke up. They weren’t, on the whole, the most talented, hardworking or innovative people, but those with the fewest scruples, the most thugs, and the best contacts – often in the KGB.

Even when outcomes are based on talent and hard work, they don’t stay that way for long. Once the first generation of liberated entrepreneurs has made its money, the initial meritocracy is replaced by a new elite, which insulates its children from competition by inheritance and the best education money can buy. Where market fundamentalism has been most fiercely applied – in countries like the US and UK – social mobility has greatly declined.

If neoliberalism was anything other than a self-serving con, whose gurus and thinktanks were financed from the beginning by some of the world’s richest people (the US multimillionaires Coors, Olin, Scaife, Pew and others), its apostles would have demanded, as a precondition for a society based on merit, that no one should start life with the unfair advantage of inherited wealth or economically determined education. But they never believed in their own doctrine. Enterprise, as a result, quickly gave way to rent.

All this is ignored, and success or failure in the market economy are ascribed solely to the efforts of the individual. The rich are the new righteous; the poor are the new deviants, who have failed both economically and morally and are now classified as social parasites.

The market was meant to emancipate us, offering autonomy and freedom. Instead it has delivered atomisation and loneliness.

The workplace has been overwhelmed by a mad, Kafkaesque infrastructure of assessments, monitoring, measuring, surveillance and audits, centrally directed and rigidly planned, whose purpose is to reward the winners and punish the losers. It destroys autonomy, enterprise, innovation and loyalty, and breeds frustration, envy and fear. Through a magnificent paradox, it has led to the revival of a grand old Soviet tradition known in Russian as tufta. It means falsification of statistics to meet the diktats of unaccountable power.

The same forces afflict those who can’t find work. They must now contend, alongside the other humiliations of unemployment, with a whole new level of snooping and monitoring. All this, Verhaeghe points out, is fundamental to the neoliberal model, which everywhere insists on comparison, evaluation and quantification. We find ourselves technically free but powerless. Whether in work or out of work, we must live by the same rules or perish. All the major political parties promote them, so we have no political power either. In the name of autonomy and freedom we have ended up controlled by a grinding, faceless bureaucracy.

These shifts have been accompanied, Verhaeghe writes, by a spectacular rise in certain psychiatric conditions: self-harm, eating disorders, depression and personality disorders.

Of the personality disorders, the most common are performance anxiety and social phobia: both of which reflect a fear of other people, who are perceived as both evaluators and competitors – the only roles for society that market fundamentalism admits. Depression and loneliness plague us.

The infantilising diktats of the workplace destroy our self-respect. Those who end up at the bottom of the pile are assailed by guilt and shame. The self-attribution fallacy cuts both ways: just as we congratulate ourselves for our success, we blame ourselves for our failure, even if we have little to do with it.

So, if you don’t fit in, if you feel at odds with the world, if your identity is troubled and frayed, if you feel lost and ashamed – it could be because you have retained the human values you were supposed to have discarded. You are a deviant. Be proud.

Egypt, Brazil, Turkey: without politics, protest is at the mercy of the elites

From Egypt to Brazil, street action is driving change, but organisation is essential if it's not to be hijacked or disarmed

• 
• • Seumas Milne
  • The Guardian, Tuesday 2 July 2013 22.30 BST

A barricade on the Rue Royale in Paris during the 1848 revolution. 'The European revolutions of 1848, which were led by middle class reformers and offered the promise of a democratic spring, had as good as collapsed within a year.' Photograph: Roger-Viollet / Rex Features

Two years after the Arab uprisings fuelled a wave of protests and occupations across the world, mass demonstrations have returned to their crucible in Egypt. Just as millions braved brutal repression in 2011 to topple the western-backed dictator Hosni Mubarak, millions have now taken to the streets of Egyptian cities to demand the ousting of the country's first freely elected president, Mohamed Morsi.

As in 2011, the opposition is a middle-class-dominated alliance of left and right. But this time the Islamists are on the other side while supporters of the Mubarak regime are in the thick of it. The police, who beat and killed protesters two years ago, this week stood aside as demonstrators torched Morsi's Muslim Brotherhood offices. And the army, which backed the dictatorship until the last moment before forming a junta in 2011, has now thrown its weight behind the opposition.

Whether its ultimatum to the president turns into a full-blown coup or a managed change of government, the army – lavishly funded and trained by the US government and in control of extensive commercial interests – is back in the saddle. And many self-proclaimed revolutionaries who previously denounced Morsi for kowtowing to the military are now cheering it on. On past experience, they'll come to regret it.

The protesters have no shortage of grievances against Morsi's year-old government, of course: from the dire state of the economy, constitutional Islamisation and institutional power grabs to its failure to break with Mubarak's neoliberal policies and appeasement of US and Israeli power.

But the reality is, however incompetent Morsi's administration, many key levers of power – from the judiciary and police to the military and media – are effectively still in the hands of the old regime elites. They openly regard the Muslim Brotherhood as illegitimate interlopers, whose leaders should be returned to prison as soon as possible.

Yet these are the people now in alliance with opposition forces who genuinely want to see Egypt's revolution brought at least to a democratic conclusion. If Morsi and the Muslim Brotherhood are forced from office, it's hard to see such people breaking with neoliberal orthodoxy or asserting national independence, as most Egyptians want. Instead, the likelihood is that the Islamists, also with mass support, will resist being denied their democratic mandate, plunging Egypt into deeper conflict.

Egypt's latest eruption has immediately followed mass protests in Turkey and Brazil (as well as smaller upheavals in Bulgaria and Indonesia). None has mirrored the all-out struggle for power in Egypt, even if some demonstrators in Turkey called for the prime minister, Recep Tayyip Erdoğan, to go. But there are significant echoes that highlight both the power and weakness of such flash demonstrations of popular anger.

In the case of Turkey, what began as a protest against the redevelopment of Istanbul's Gezi Park mushroomed into mass demonstrations against Erdoğan, 's increasingly assertive Islamist administration, bringing together Turkish and Kurdish nationalists, liberals and leftists, socialists and free-marketeers. The breadth was a strength, but the disparate nature of the protesters' demands is likely to weaken its political impact.

In Brazil, mass demonstrations against bus and train fare increases turned into wider protests about poor public services and the exorbitant cost of next year's World Cup. As in Turkey and Egypt, middle-class and politically footloose youth were at the forefront, and political parties were discouraged from taking part, while rightwing groups and media tried to steer the agenda from inequality to tax cuts and corruption.

Brazil's centre-left government has lifted millions out of poverty, and the protests have been driven by rising expectations. But unlike elsewhere in Latin America, the Lula government never broke with neoliberal orthodoxy or attacked the interests of the rich elite. His successor, Dilma Rousseff – who responded to the protests by pledging huge investments in transport, health and education and a referendum on political reform – now has the chance to change that.

Despite their differences, all three movements have striking common features. They combine widely divergent political groups and contradictory demands, along with the depoliticised, and lack a coherent organisational base. That can be an advantage for single-issue campaigns, but can lead to short-lived shallowness if the aims are more ambitious – which has arguably been the fate of the Occupy movement.

All of them have, of course, been heavily influenced and shaped by social media and the spontaneous networks they foster. But there are plenty of historical precedents for such people power protests – and important lessons about why they are often derailed or lead to very different outcomes from those their protagonists hoped for.

The most obvious are the European revolutions of 1848, which were also led by middle-class reformers and offered the promise of a democratic spring, but had as good as collapsed within a year. The tumultuous Paris upheaval of May 1968 was followed by the electoral victory of the French right. Those who marched for democratic socialism in east Berlin in 1989 ended up with mass privatisation and unemployment. The western-sponsored colour revolutions of the last decade used protesters as a stage army for the transfer of power to favoured oligarchs and elites. The indignados movement against austerity in Spain was powerless to prevent the return of the right and a plunge into even deeper austerity.

In the era of neoliberalism, when the ruling elite has hollowed out democracy and ensured that whoever you vote for you get the same, politically inchoate protest movements are bound to flourish. They have crucial strengths: they can change moods, ditch policies and topple governments. But without socially rooted organisation and clear political agendas, they can flare and fizzle, or be vulnerable to hijacking or diversion by more entrenched and powerful forces.

That also goes for revolutions – and is what appears to be happening in Egypt. Many activists regard traditional political parties and movements as redundant in the internet age. But that's an argument for new forms of political and social organisation. Without it, the elites will keep control – however spectacular the protests.

Savers across Europe will look on in horror at the Troika's raid on Cyprus

It's now become clear: the threat to European savers and banks isn't anti-austerity parties but the Troika

• 
• • Michael Burke
  • The Guardian, Sunday 17 March 2013 17.06 GMT

Account-holders withdraw money from a cash machine in the Cyprus capital, Nicosia. Photograph: Barbara Laborde/AFP/Getty Images

The imposition of a levy on savers in Cypriot banks marks a new turn in the European crisis. Savings of over €100,000 will be subject to a 10% tax, and those under €100,000 one of 6.7%. The raid has been instructed by the "Troika" – the European commission, the IMF and the European Central Bank – as part of a characteristic "take it or leave it" ultimatum to the Cypriot government. The parliament in Nicosia is being pressed to ratify the deal with the threat that without it there will be no bailout funds and the ECB will withdraw all liquidity support to the stricken banks.

The Troika and its supporters have justified the levy by arguing that the state could not support the debt burden of a bank bailout. But this simply means the debt burden has been transferred from the banks, where it properly belongs, to households, who had no part in their lending decisions.

As part of that propaganda campaign, the focus has been on Russian oligarchs and tax evaders who have been laundering funds through Cypriot banks. In fact, among those caught in the upper savings bracket are bound to be pensioners for whom this represents their entire life savings, and others who have recently borrowed enough money to buy a modest home. But even if only oligarchs were affectedE, this is surely an admission of guilt by the European and international authorities, who are responsible for the global regulation of banks and co-ordinating anti-money laundering activities. Their own failure can hardly be a justification for expropriating the small savers of Cyprus.

The irony is that all this is done in the name of promoting stability. When anti-austerity parties have made strong showings in elections – in Greece, Ireland, France and Portugal – the pro-austerity parties have warned that the cash machines would dry up because no bailout fund would be made available to an anti-austerity government, and banks would be given no liquidity support. It is now clear that it is not anti-austerity parties but the Troika that is the direct threat to the savers of Europe and their domestic banking systems.

The question arises as to why Cyprus has been treated so much worse than other countries – the contrast with the treatment of Spain is marked, despite all the prior bullying. This is partly because the savers of large EU countries will not be directly affected by what happens to Cyprus, although the British press is already focused on the potential losses to British pensioners and service personnel based there. More important, however, the big banks of the same large countries are not facing any losses. If Spain collapses, it will take a large portion of the major European banks with it; this is why the Troika backed off from forcing Spain into a bailout programme.

But it is foolish of the Troika to assume that its confiscation of Cypriot savings will have no international implications. Savers all across Europe will look on in horror, and are bound to wonder whether it could happen in their own countries. It is entirely possible they will respond by shifting their savings into state or postal savings banks at the very least, even if outright bank runs are avoided. If this happens on sufficient scale, it could further undermine the fragile banking system in a number of countries.

It also has implications for the anti-austerity parties of Europe, who have long argued for nationalisation of the banks. As British government ownership of RBS shows, such nationalisation achieves nothing without directing the banks towards increased investment. In the single currency area, the left is now faced with an additional risk of the Troika withdrawing funds, and organised capital flight.

To prevent Troika raids, deposits need to be put into protective custody to preserve both savings and the domestic banking sector. For anti-austerity governments, these funds could then be used to support state-led investment and reverse the European depression.

Cameron's immigration hierarchy: Rich Indians good, eastern Europeans bad

David Cameron's welcome mat to 'hardworking' Indians contrasts with attitudes towards the new EU entrants

• 
• • Alana Lentin
  • guardian.co.uk, Monday 18 February 2013 16.00 GMT

David Cameron speaks at a business seminar in Mumbai on February 18. Photograph: Indranil Mukherjee/AFP/Getty Images

 

In The End of Tolerance, Arun Kundnani argues that the ability to integrate in today's Britain is based less on how you look and more on whether or not you are deemed culturally compatible. This may seem like progress but the sliding scale along which humanity is now organised is not unlike the racial hierarchies of old; it's just less colour-coded. So, an English-educated Indian professional may be more acceptable than a white, jobless Bulgarian or Romanian. This is exactly on point as we witness David Cameron's rush to India, a country whose economic rise he described as "one of the great phenomena of the century".

Cameron and his entourage of CEOs and vice-chancellors will undoubtedly speed past the slums rapidly being cleared for the shiny new malls being built on every spare inch of India's major cities. The majority of Indians – arguably worse off since the advent of neoliberalism in the "largest democracy" – are not who Cameron has in mind when he talks about unleashing "India's potential".
Back in the UK, the imminent arrival of Bulgarians and Romanians with new EU rights is being painted as a make or break electoral issue. They are the victims of a "xeno-racism" that holds impoverished strangers, including whites, in its sight. In contrast, Indian students with the cash to pay premium fees to study at British universities will, according to Cameron, have the red carpet rolled out and will not, he has claimed, be subject to limits on how long they can stay and work. How such "positive discrimination" will be justified in light of the Tories' commitment to a cap on immigration in the tens of thousands per year remains to be seen.

Cultural stereotypes abound. Indians – not Pakistanis mind – are deemed hardworking and resourceful with infinite admiration for the UK and its traditions. Colonialism is rewritten as a "special relationship". Indians (Hindus) assimilate into the British way of life, speak English, and are religious moderates. They are not a drain, rather an opportunity for investment in an ailing British economy.

Romanians and Bulgarians, on the other hand, are today's "wretched of the earth", described by Trevor Kavanagh in The Sun as variably corrupt, as rapists and as pickpockets. The Tories will lose the Eastleigh byelection, he warns, unless the government puts its foot down and refuses to grant full EU rights to Romanian and Bulgarian citizens before they descend on the UK.

The comparison of Cameron's rhetoric on India and Britain's newest EU partners reveals how, on the surface at least, racism is so often influenced by economics. The successful are pitted against the scroungers, no matter the extent to which either stereotype holds water. Immigration with a capital "I" – as a headline rather than a life experience – has always needed heroes and villains, those who gave versus those who took, those who built versus those who destroyed. Racism works to attach these apparently natural attributes to whole groups of people and that is why it is never detachable from the immigration "debate". This is the message that Cameron is sending: we will tolerate those who can benefit us, but not those who fail to make us prosper.

Indians are no more universally assimilable than south-eastern Europeans are detrimental to the UK. Indeed, the opposite was once deemed to be the case when skin colour, rather than cultural compatibility, influenced migration policy more explicitly and arrivals from the east were dissidents, not purported social security hunters. Only when we decouple immigration from race will the arbitrariness of the ranking of populations according to profitability become apparent and racial generalisations – positive or negative – be shown up for the poverty of the ideas that lie beneath them.

The west's crisis is one of democracy as much as finance

The spirit of dictators like Ceausescu is finding new life in the response of the European elite to pressures in the eurozone

• 
• • Slavoj Žižek
  • The Guardian, Wednesday 16 January 2013 18.22 GMT

Nicolae Ceausescu addresses Romania's Communist party congress in November 1989, shortly before he was deposed and executed. Photograph: Gerard Fouet/AFP

 

In one of the last interviews before his fall, Nicolae Ceausescu was asked by a western journalist how he justified the fact that Romanian citizens could not travel freely abroad although freedom of movement was guaranteed by the constitution. His answer was in the best tradition of Stalinist sophistry: true, the constitution guarantees freedom of movement, but it also guarantees the right to a safe, prosperous home. So we have here a potential conflict of rights: if Romanian citizens were to be allowed to leave the country, the prosperity of their homeland would be threatened. In this conflict, one has to make a choice, and the right to a prosperous, safe homeland enjoys clear priority …

It seems that this same spirit is alive and well in Slovenia today. Last month the constitutional court found that a referendum on legislation to set up a "bad bank" and a sovereign holding would be unconstitutional – in effect banning a popular vote on the matter. The referendum was proposed by trade unions challenging the government's neoliberal economic politics, and the proposal got enough signatures to make it obligatory.

The idea of the "bad bank" was of a place to transfer all bad credit from main banks, which would then be salvaged by state money (ie at taxpayers' expense), so preventing any serious inquiry into who was responsible for this bad credit in the first place. This measure, debated for months, was far from being generally accepted, even by financial specialists. So why prohibit the referendum? In 2011, when George Papandreou's government in Greece proposed a referendum on austerity measures, there was panic in Brussels, but even there no one dared to directly prohibit it.

According to the Slovenian constitutional court, the referendum "would have caused unconstitutional consequences". How? The court conceded a constitutional right to a referendum, but claimed that its execution would endanger other constitutional values that should be given priority in an economic crisis: the efficient functioning of the state apparatus, especially in creating conditions for economic growth; the realisation of human rights, especially the rights to social security and to free economic initiative.

In short, in assessing the consequences of the referendum, the court simply accepted as fact that failing to obey the dictates of international financial institutions (or to meet their expectations) can lead to political and economic crisis, and is thus unconstitutional. To put it bluntly: since meeting these dictates and expectations is the condition of maintaining the constitutional order, they have priority over the constitution (and eo ipso state sovereignty).

Slovenia may be a small country, but this decision is a symptom of a global tendency towards the limitation of democracy. The idea is that, in a complex economic situation like today's, the majority of the people are not qualified to decide – they are unaware of the catastrophic consequences that would ensue if their demands were to be met. This line of argument is not new. In a TV interview a couple of years ago, the sociologist Ralf Dahrendorf linked the growing distrust for democracy to the fact that, after every revolutionary change, the road to new prosperity leads through a "valley of tears". After the breakdown of socialism, one cannot directly pass to the abundance of a successful market economy: limited, but real, socialist welfare and security have to be dismantled, and these first steps are necessarily painful. The same goes for western Europe, where the passage from the post-second world war welfare state to new global economy involves painful renunciations, less security, less guaranteed social care. For Dahrendorf, the problem is encapsulated by the simple fact that this painful passage through the "valley of tears" lasts longer than the average period between elections, so that the temptation is great to postpone the difficult changes for the short-term electoral gains.

For him, the paradigm here is the disappointment of the large strata of post-communist nations with the economic results of the new democratic order: in the glorious days of 1989, they equated democracy with the abundance of western consumerist societies; and 20 years later, with the abundance still missing, they now blame democracy itself.

Unfortunately, Dahrendorf focuses much less on the opposite temptation: if the majority resist the necessary structural changes in the economy, would one of the logical conclusions not be that, for a decade or so, an enlightened elite should take power, even by non-democratic means, to enforce the necessary measures and thus lay the foundations for truly stable democracy?

Along these lines, the journalist Fareed Zakaria pointed out how democracy can only "catch on" in economically developed countries. If developing countries are "prematurely democratised", the result is a populism that ends in economic catastrophe and political despotism – no wonder that today's economically most successful third world countries (Taiwan, South Korea, Chile) embraced full democracy only after a period of authoritarian rule. And, furthermore, does this line of thinking not provide the best argument for the authoritarian regime in China?

What is new today is that, with the financial crisis that began in 2008, this same distrust of democracy – once constrained to the third world or post-communist developing countries – is gaining ground in the developed west itself: what was a decade or two ago patronising advice to others now concerns ourselves.

The least one can say is that this crisis offers proof that it is not the people but experts themselves who do not know what they are doing. In western Europe we are effectively witnessing a growing inability of the ruling elite – they know less and less how to rule. Look at how Europe is dealing with the Greek crisis: putting pressure on Greece to repay debts, but at the same time ruining its economy through imposed austerity measures and thereby making sure that the Greek debt will never be repaid.

At the end of October last year, the IMF itself released research showing that the economic damage from aggressive austerity measures may be as much as three times larger than previously assumed, thereby nullifying its own advice on austerity in the eurozone crisis. Now the IMF admits that forcing Greece and other debt-burdened countries to reduce their deficits too quickly would be counterproductive, but only after hundreds of thousands of jobs have been lost because of such "miscalculations".

And therein resides the true message of the "irrational" popular protests all around Europe: the protesters know very well what they don't know; they don't pretend to have fast and easy answers; but what their instinct is telling them is nonetheless true – that those in power also don't know it. In Europe today, the blind are leading the blind.

If you think we're done with neoliberalism, think again

The global application of a fraudulent economic theory brought the west to its knees. Yet for those in power, it offers riches

• 
• • George Monbiot
  • The Guardian, Monday 14 January 2013 20.30 GMT

‘The demands of the ultra-rich have been dressed up as sophisticated economic theory and applied regardless of the outcome.' Illustration: Daniel Pudles

How they must bleed for us. In 2012, the world's 100 richest people became $241 billion richer. They are now worth $1.9 trillion: just a little less than the entire output of the United Kingdom.


This is not the result of chance. The rise in the fortunes of the super-rich is the direct result of policies. Here are a few: the reduction of tax rates and tax enforcement; governments' refusal to recoup a decent share of revenues from minerals and land; the privatisation of public assets and the creation of a toll-booth economy; wage liberalisation and the destruction of collective bargaining.

The policies that made the global monarchs so rich are the policies squeezing everyone else. This is not what the theory predicted. Friedrich Hayek, Milton Friedman and their disciples – in a thousand business schools, the IMF, the World Bank, the OECD and just about every modern government – have argued that the less governments tax the rich, defend workers and redistribute wealth, the more prosperous everyone will be. Any attempt to reduce inequality would damage the efficiency of the market, impeding the rising tide that lifts all boats. The apostles have conducted a 30-year global experiment, and the results are now in. Total failure.

Before I go on, I should point out that I don't believe perpetual economic growth is either sustainable or desirable. But if growth is your aim – an aim to which every government claims to subscribe – you couldn't make a bigger mess of it than by releasing the super-rich from the constraints of democracy.

 Last year's annual report by the UN Conference on Trade and Development should have been an obituary for the neoliberal model developed by Hayek and Friedman and their disciples. It shows unequivocally that their policies have created the opposite outcomes to those they predicted. As neoliberal policies (cutting taxes for the rich, privatising state assets, deregulating labour, reducing social security) began to bite from the 1980s onwards, growth rates started to fall and unemployment to rise.

The remarkable growth in the rich nations during the 50s, 60s and 70s was made possible by the destruction of the wealth and power of the elite, as a result of the 1930s depression and the second world war. Their embarrassment gave the other 99% an unprecedented chance to demand redistribution, state spending and social security, all of which stimulated demand.

Neoliberalism was an attempt to turn back these reforms. Lavishly funded by millionaires, its advocates were amazingly successful – politically. Economically they flopped.

Throughout the OECD countries taxation has become more regressive: the rich pay less, the poor pay more. The result, the neoliberals claimed, would be that economic efficiency and investment would rise, enriching everyone. The opposite occurred. As taxes on the rich and on business diminished, the spending power of both the state and poorer people fell, and demand contracted. The result was that investment rates declined, in step with companies' expectations of growth.

The neoliberals also insisted that unrestrained inequality in incomes and flexible wages would reduce unemployment. But throughout the rich world both inequality and unemployment have soared. The recent jump in unemployment in most developed countries – worse than in any previous recession of the past three decades – was preceded by the lowest level of wages as a share of GDP since the second world war. Bang goes the theory. It failed for the same obvious reason: low wages suppress demand, which suppresses employment.

As wages stagnated, people supplemented their income with debt. Rising debt fed the deregulated banks, with consequences of which we are all aware. The greater inequality becomes, the UN report finds, the less stable the economy and the lower its rates of growth. The policies with which neoliberal governments seek to reduce their deficits and stimulate their economies are counter-productive.

The impending reduction of the UK's top rate of income tax (from 50% to 45%) will not boost government revenue or private enterprise, but it will enrich the speculators who tanked the economy. Goldman Sachs and other banks are now thinking of delaying their bonus payments to take advantage of it. The welfare bill approved by parliament last week will not help to clear the deficit or stimulate employment: it will reduce demand, suppressing economic recovery. The same goes for the capping of public sector pay. "Relearning some old lessons about fairness and participation," the UN says, "is the only way to eventually overcome the crisis and pursue a path of sustainable economic development."

As I say, I have no dog in this race, except a belief that no one, in this sea of riches, should have to be poor. But staring dumbfounded at the lessons unlearned in Britain, Europe and the US, it strikes me that the entire structure of neoliberal thought is a fraud. The demands of the ultra-rich have been dressed up as sophisticated economic theory and applied regardless of the outcome. The complete failure of this world-scale experiment is no impediment to its repetition. This has nothing to do with economics. It has everything to do with power.

Hazare ke Khwaishen aisi ki har Khwaish ho-hum nikale// Bahut nikale unke demands phir bhi kam nikale

Corruption And Its Discontents

By Niranjan Ramakrishnan

26 August, 2011
Countercurrents.org

Hazare ke Khwaishen aisi ki har Khwaish ho-hum nikale
Bahut nikale unke demands phir bhi kam nikale

(with apologies to Mirza Ghalib)

Judging from the New York Times and the Washington Post, urban India is abuzz with the idea of banishing corruption. Photographs of peaceful marchers filling a giant overpass have made front-page news. Anna Hazare, whose arrest and fast have ignited the stir in cities all across India and amongst Indian groups abroad, is now a well-known figure. The fast, meetings, and protests are being billed as nothing less than a second Freedom Movement.

That last accreditation is in perfect pitch with an intelligentsia cut adrift from any sense of proportion, as befitting one that till only the other day was capable of considering Manmohan Singh a more significant reformer than Mahatma Gandhi.

Amid all the din it is easy to forget the lofty purpose of the Second Freedom Movement. It is for the appointment of an ombudsman and a subsidiary bureaucracy to oversee allegations of corruption amongst government officials. One may just as soon label a demand for Web access to one's income tax records as the second Declaration of Independence.

Owing perhaps to his experiences as a lawyer, Gandhi did not view some new law as the panacea to every social, economic or political problem. He pinned a lot more importance on the renewal of the human being. Gandhi believed that the quality of any country ultimately depends on the quality of its people. His abhorrence of legal cleverness as a means to fixing human problems is best illustrated by EF Schumacher in his classic, Small Is Beautiful,

" Gandhi used to talk disparagingly of 'dreaming of systems so perfect that no-one will need to be good'. "

That corruption is the scourge of daily existence in India as in few other countries may be entirely true. Ordinary people in everyday life have to pay bribes all the way from getting a driver's license to obtaining a housing permit. Certainly many of these are paid to government officials, big and small. The same government officials have to bribe others in their capacity as applicants. Corruption is many things to many people.

What Anna Hazare and his acolytes seem to forget is that corruption is not limited to the government. They also appear to believe that the appointment of eminent Indians to some overseeing council would somehow ensure moral chastity. If credentials alone, or even a personal reputation for incorruptibility, were such strong safeguards, the administration of Prime Minister Manmohan Singh should be a showcase for civics textbooks on model governance. Instead, it is considered the fount of malpractice and graft on a gargantuan scale, with many reckoning it presides over the most corrupt dispensation in independent India's history.

Neither the protesters nor the government want to address the issue of corruption in India in its deeper essence. Is it an obscenity only when a government official receives a bribe? What about corruption of the conscience? For instance, is it corruption when someone can build a 60 story skyscraper for a personal residence in a country where millions of children go to bed malnourished? Gandhi again,

"Every palace that one sees in India is a demonstration, not of her riches, but of the insolence of power that riches give to the few, who owe them to the miserably requited labours of the millions of the paupers of India."

Even though there seems to be a palpable correlation between the size and scope of scams in India and Manmohan Singh's neoliberal initiatives starting in the early 90s, Anna Hazare and his wise counselors don’t seem to want to see it. And amidst all his ineptitude in dealing with this latest crisis, practically the first words out of the Prime Minister’s mouth were to caution that it would be wrong to connect corruption with economic liberalization.

As veteran journalist Alexander Cockburn is fond of saying, "never believe anything until it is officially denied".

In 1991, Manmohan Singh, finance Minister in a minority government, kicked off a 'liberalization' program laying the foundation for a two decade neoliberal spree. It has turned some 250 million Indian citizens into celebrated ‘consumers’, but distorted any measure of what Professor Amartya Sen would call ‘social choice'. In this new order, what is good for consumerism and high living is alone good for India, whatever its cost by way of farmer suicides, uprooting of entire villages, pollution of the water table, or handing over of India's agricultural future to the GMO boys at Monsanto and elsewhere. The lone measure of success in this Eastern Wild-West is something called growth rate; the ethos it has spawned would both amaze and gratify Gordon "Greed Is Good" Gecko.

Gandhi's diagnosis and cure for India's corruption epidemic would probably involve a lot more pain and sacrifice than a few marches. He might point out that in a milieu where leaders openly promote moneymaking as the most important virtue, and an elite esteems itself by the extent of its ostentation, corruption would only find a conducive habitat. He would reject recourse to some bill, not for some technical shortcomings, but perhaps saying that reliance on such measures would "diminish the moral height" of Indians, just as his khadi movement urged Indians to boycott foreign cloth and adopt the rougher and costlier homespun, instead of a fast outside the Viceroy’s palace pleading for a ban on English mill imports.

The fervid and often uncivil jousting between "civil society" on the one side and the gentleman Prime Minister’s cabinet on the other, poring over fine points of an anticorruption bill while taking care never to mention the 800 pound gorilla parked in the middle of the room, reminded me of something I had read long ago.

“One of the greatest of the Bengali novelists of the 20th century, Sarat Chandra Chatterjee, has summed up the underlying principle of Hindu behavior in a neat, if cynical, epigram. He makes a woman who had a low-caste paramour boast that although she lived 20 years with him she had not for a single day allowed him to enter her kitchen.”

-- Nirad Chaudhuri, Autobiography of an Unknown Indian

Niranjan Ramakrishnan is a writer living in the United States. He can be reached at njn_2003@yahoo.com

Oprah and the philanthropy that chokes

Billionaire celebrities want to save the world Oprah Winfrey-style. But their giving has a price

• 
• • Priyamvada Gopal
  • guardian.co.uk, Sunday 14 August 2011 17.36 BST
  • larger | smaller

Oprah Winfrey has given money to New Orleans, HIV/Aids prevention, abused women's shelters and private scholarships. Photograph: Mario Anzuoni/Reuters
Media empress Oprah Winfrey has been nominated for a special Oscar, the Jean Hersholt award, for those "whose humanitarian efforts have brought credit to the industry". This has created mild controversy in the US, with some charging that she is insufficiently Hollywood to merit an award held by the likes of Elizabeth Taylor and Paul Newman. But Winfrey is as good a choice as any to confer an aura of piety on an industry better known for lavish lifestyles than saving the world. Her contributions to charitable causes have included reconstruction in New Orleans, HIV/Aids prevention, abused women's shelters, church charities and private school scholarships for disadvantaged children. More interesting is why humanitarianism has assumed such importance as a must-be-seen-to-be-doing-it activity for the rich and the famous. From the obligatory royal photo-op with the homeless on LA's Skid Row to the ubiquitous images of white female celebrities cradling African babies, exhibitionist "caring" is as essential a marker of wealth and celebrity as signature scents and personal assistants. It's too easy to argue this is about mitigating guilt and resentment. More significant is how billionaire benevolence is closely tied to the big neoliberal political manoeuvres of our time. This relationship can be scrutinised without necessarily questioning Winfrey's personal sincerity or denying that wealthy giving benefits a few. Brand Oprah is a seamless and hugely influential melding of capitalism, self-help, humanitarian aspirations and spirituality. Endless consumption is encouraged by personal recommendations and lavish freebies from iPods to jewellery. At the same time, disciples can practise tasteful austerity with "debt diets" reminding us that "we are all responsible for everything that happens to us". The poor, too, are responsible both for their condition and for overcoming it. Buying things for the deserving poor – and Winfrey is clear that they are not all deserving – must be seen as "giving them bootstraps". Pledging to "destroy the welfare mentality", Winfrey has often suggested that receiving state assistance is a choice, one she herself rejected. Her grand philanthropic acts, such as the failed experiment to move 100 Chicago families into private housing during Bill Clinton's "welfare reform" efforts, are accompanied by politically welcomed criticism of public assistance as dependence. Yet as psychologist Bruce Levine notes, it is precisely "fundamentalist consumerism" which destroys self-reliance. Winfrey has been justifiably accused by activists of "reinforcing the US war on the poor" by blaming victims. In practising what should really be called "humanitarian privatisation", Winfrey and other philanthropists like Bill Gates have targeted public education with missionary zeal, speaking authoritatively on a subject they know little about. Having decided not to donate to inner-city public schools after criticising them and deeming their students unwilling to learn, Winfrey has publicly backed those advocating "charter schools", the US equivalent of free schools – including Gates and the makers of a controversial film, Waiting for "Superman", which attacks teachers and unions. In a parallel move, Rupert Murdoch is going ahead with plans to sponsor an academy in east London over the objections of the local council. The billionaire "humanitarianism" of Winfrey, Gates and Murdoch is deeply compromised not only by its failure to acknowledge the causal relationship between extreme wealth and great poverty but by participating in an ideological assault on the welfare state. It posits itself as the only way to change the world – from above and with a wealthy few firmly in control. A Hollywood celebrity more worthy of our respect is Matt Damon who, as American schoolteachers demonstrated this month in a Save Our Schools rally, confronted media suggestions that job security made teachers lazy. In a video clip that has gone viral, Damon lambasts "MBA-style thinking" as "the problem with [education] policy right now". This solidarity with the aspirations of the many and not the self-interested paternalism of the few is the humanitarianism that our times call for.

• © 2011 Guardian News and Media Limited or its affiliated companies. All rights reserved.