Some Contradictions of Capitalist Democracy

Despite the fact that we are confronted with the phenomenon of the “Inflation of democracy”, at the intellectual level, the voter turnout rate is decreasing all over the world. Hobsbawm notes that people are legitimately withdrawing from citizenship. “The state’s powers and functions have been undermined by the size of supranational and infranational forces,… this can best be described as the withdrawal of its inhabitants from citizenship” (1996 p. 73). The weakening of the state is accompanied by the increased dominance of market forces. This domination of the circuit of capital over the circuit of citizenship is a manifestation of what I call “the internal contradiction of capitalist democracy”.

What are the reasons behind this withdrawal from the sphere of citizenship? Has the Enlightenment’s claim of anthropocentricity and the sanctity of the right of self-determination become irrelevant for the new generation? What are the underpinning factors behind this legitimate withdrawal from the sphere of citizenship?

When we look at the present Western political system in global perspective, two important tendencies are evident.

(a) Successful accumulation of capital is not of a domestic nature rather it is intrinsically global. That also leads to an increase in the concentration of capital

(b) Political and cultural communities are disintegrating throughout the Western world. Political theorists believe that these tendencies be countered by the development of “civil society”.

The idea of civil society contrasts itself from that of religious society. Civil society is supposed to emerge due to the establishment of a contract among equally rational, free and self-interested individuals. In such a society individuals are “held together by impersonal bonds of interest rather than ties of kin and blood” (Ignateiff 1995 p. 130), or faith. Civil society provides a fair procedure which helps individuals to pursue their own conception of the good. It presumes the existence of a self-sustaining mechanism, ordered by an efficient and systematically organised legal framework. It provides  “…a self-correcting mechanism in which the selfish actions of myriad individuals brought together only by the rule of law, manages to produce an orderly and dynamic accumulation of prosperity unprecedented in human history” (Ignateiff p. 130). The paradigm of the market is constantly expanding. “The economic approach is a comprehensive one that is applicable to all human behaviours”. (Escobor 1995 p. 151) Becker’s work on population represents all social and personal relationships as capable of marketisation. In modern political economy, the sole criteria for the determination of what ought to be and what ought not to be is that of the market. Modern political economy presumes market activity to be self-justificatory. The state is not expected to play any part in the determination of value.

Civil society and free market economy reinforce each other. “Even as a welfare agency the state does not work against the market” (Berthoval 1955 p. 73). The presumption behind “this neo-liberal framework is that economic growth without any redistribution at all should allow us to solve the dramatic problem of poverty throughout the world without the smallest contribution imposed upon the rich” (Berthoval p. 73). Gellner considers civil society as “a profane society, a society that explicitly sought to put the lowest of human desires to productive uses”. Mandeville acknowledges that, in such a society, ‘private vices make public virtues. The profane is purified by demonstrating that capitalist individuals are more likely to promote the public good when they looked exclusively to their private interest (both qouted in & Ignateiff 1 995 p. 1 30). In a nutshell, we can say that it is presumed that the market can produce an equitable and just redistributive system and civil society could also be a moral order spontaneously and unintentionally generated by the operation of market forces.

But the accumulation of global capital has historically depended upon the strengthening of the nation-state. Today, this nation-state is being weakened through decentralisation. Hobsbawm identifies three basic reasons for the decentralisation of nation-states.

“First, the creation of a supranational (or rather transnational) economy, whose transactions are largely uncontrolled or even uncontrollable by states, restricts the capacity of states to direct national economies… Second, the state has been weakened by the rise of regional or global institutions such as the European Union and the international banking institutions. . .Third, territorial borders have been made largely irrelevant by the technological revolution in transport and communications” (1996 p. 272).

Decentralisation is being promoted globally. Small communities are actually performing two functions, one is intentional and the other which is more important and disastrous is unintentional.

Firstly, the international function is to sustain the sphere of citizenship which is shrinking because of the individual’s legitimate voluntary withdrawal from the sphere of citizenship at the national level. “the decline in ideological mass parties., politically mobilising electoral machines or other organisations for mass civic activity (such as labour unions) is (an indication of this); another is the spread of the values of consumer individualism, in an age when the satisfactions of rising consumption are both widely available and constantly advertised”. (Hobsbawm 1996 p. 273) Civil society is basically a capitalist institution of instrumental nature. Its function is to sustain liberal public order which is disintegrating, because of the politically and socially dangerous growth of inequality between regions and individuals. That free market policies, uncorrected by public redistribution create social inequalities needs no proof after the dramatic increase in the inequality of income since the 1 980s. (Hobsbawm 1996 p. 275), We observe that the economic concessions (social benefits and welfare) granted previously have no justification in current liberal thought. The claim that the state must prevent the least privileged from incurring losses has now become obsolete. And the situation is that: about 300 million people in the third world were unemployed or under-employed in the late 1970s, as were about 22 million people in the industrialised capitalist countries. By 2000, it is estimated that well over one billion people will be seeking employment in the third world alone (Gursov 1998 p. 4). Due to the incapacity of the state, the liberal promoters of civil society are providing support to non-governmental organisations and trying to delegitimate the state’s social interventions. It is important to note that civil society presumes a free market economy, but the inevitable consequence of the flourishing of the market mechanism is that the state gets weaker and weaker. Thus a strong civil society creates a weak state.

Secondly, the unintentional consequence of decentralisation is that, it legitimates capital accumulation and concentration. The only instrument which a modern political economy has to counter the hegemony of capital is the nation-state. But because of the development of the free market economy and civil society, the state gets weaker and weaker so that the possibility of the performance of the redistribute function becomes increasingly difficult.

The basic category of the liberal state is citizenship, and such a state is basically a representative of the citizen, but who is a citizen? In principle (according to classical liberal political theory) the citizen is the sovereign and he has a divine right Since he has divine right, he is free to choose whatever he wants, or whatever he wills. In this context the state is an instrument through which he can realise or actualise his desires and wants which are necessarily legitimate because he is sovereign, rational and free. Thus the liberal conception of citizenship presumes every individual to be equally free and rational that is why on the one hand at the private level everybody has a right to pursue his own conception of the good On the other hand, everybody has an equal right of vote, irrespective of his religious, social, cultural, political, educational upbringing. The vote is an abstract form of freedom. Since the citizen legitimately surrenders his sovereignty to the state, therefore, it is necessary for the state to legitimise that relinquishment. The state must effectively and honestly perform a redistributive function so that even disadvantaged citizens can realise their desires. The redistributive function of the nation-state is in actuality an important instrument which sustains the sphere of liberal citizenship. Otherwise, the commitment of the people to the state in principle becomes illegitimate. This reveals an important aspect of the relation between liberal socio-political theory and the idea of citizenship.

The market is basically the sphere of non-citizenship. In the market, we are not equal individuals, or in other words, we are not citizens, nor are we men, or women, or black or white or Hindu or Muslim. We are consumers or producers or labourers or managers. In short, the market is not subordinate to political democratic morality. It is not just amoral but immoral. In Social Limits to Growth (1976) Fred Hirsch dealt at length with what he called “the depleting moral legacy of capitalism”. He argued that the market undermines the moral values that are its own essential underpinnings, values that have been inherited from preceding socio-economic moral orders, specifically Christianity.

Thus the market is the sphere of oppression and selfishness. The rationale of the market is purely consequentialist, “the seductive power of the market is so powerful today that aid is no longer viewed as a moral policy. With the failure of the centralised planning model and the rise of the new market mentality, aid is quite explicitly designed in purely utilitarian items”. (Berthoval 1995 p. 731). The market is not the sphere of citizenship it is that of capital. Capital is the surplus extracted out of the circuit of production. Capital is something which is constantly searching for itself. This is one of the reasons that in a capitalist economy the goods market is superseded by the money market, and the real evaluative centres of the economy are the financial markets. The objective of all economic activity is accumulation for its own sake, the amassment of pure quantity. The driving force behind financial markets is normally speculation and not investment for the satisfaction of human needs. In the market, capital compels individuals to accumulate for the sake of accumulation.

Thus, according to liberal political theory, the market is the sphere of capital while the state is the sphere of citizenship. In the realm of citizenship, the individual is sovereign, He has the divine right to desire whatever he wants, whereas in the sphere of capital all one can desire, is capital accumulation which is an end in itself. The dilemma of liberal theory is, that these different spheres of sovereignties normally clash with each other.

The sovereignty of the citizen clashes with the sovereignty of capital. The question arises as to why this happens? What is the justification of this confrontation? The enlightenment claim of anthropocentricity presumes the project of the enhancement of freedom. When this project is concretised in political, economic discourse, we find two aspects of the realisation of freedom.

{a.) The abstract form of freedom = vote (circuit of citizenship)

(b) The concrete form of freedom = capital ( circuit of capital)

Theoretically, the individual is free to desire, anything he desires. But the irony is that the only desire he must have is the desire for capital accumulation because capital is the concrete form of freedom. In a capitalist economy, the individual is compelled to accept the sovereignty of capital because he does not have any instrument other than capital through which he can realise his freedom (remember Rawls’ primary goods). Because of this internal contradiction of liberal political theory, we are experiencing the legitimate withdrawal from the sphere of citizenship and the extension of the circuit of capital. This withdrawal from the sphere of citizenship puts democracy at risk. But a threat to democracy is also a threat to capitalism for the pursuits of enlightened self-interest requires commitment to the ideology of antecedent individuality and the divine right of the citizen.

References:

Berthoval Gerald, “Market” in Wolfgang Sachs (ed.), The Development Dictionary: A Guide, tn Knowledge as Power. Johannesburg: University Press 1995.

Escobar Arturo, “Planning 1 ‘ in Woefgang Sachs (ed.), The Development Dictionary: A Guide to Knowledge as Power. Johannesburg: University Press 1995.

Gursov Mel. ” Global Polices in the Human Interest ” London, Lyn Reiner 1998.

Hobsbawm E.J. , “The future of the state” Development and Change vol. 27 (1996 p. 71-96). Hirschman A. O. “Rival Interpretations of Market Society”; Civilising, Destructive, or Feeble” Journal of Economic Literature Vol, 20 (Dec. 1982 p. 1176-1199).

Ignateiff Michael, “On civil society; why Eastern Europe’s Revolutions could succeed.” Foreign Affairs vol. 74, No. 2 March April 1995. P. 112-144