Robert J Samuelson writes in Newsweek about what he considers to be a fundamental conflict between capitalism, by which he means a system of free market economy, and democracy. He thinks there’s a built in opposition between capitalism’s desire for change on one hand, and democracy’s desire for security and status quo rising from demands of special interest groups on the other. To prove his point he looks at the Japanese and German elections – two countries in dire need of change towards a more capitalist system, and two countries that – in his estimation – voted for slow change if they voted for change at all.
Dick Erixon comments on the article saying (in my translation):
…if we take a look at the grand perspective nation states are a relatively new idea in human history. As is democracy and the welfare state that, within national borders, have promised more and more benefits for it’s citizens, often payed for by future generations (like the old Swedish retirement program). Is it possible to uphold the balance between capitalism and state activity? Does democracy inevitably lead to ever shrinking economic freedom? Does democracy lack brakes?
Unfortunatly at least the German election points in this direction. To even breath about renewal leads to immediate loss in elections. Democracy can only produce one kind of policits: the one that leads to economic totalitarianism. And, if so, to the end of capitalism and welfare.
It’s an interesting discussion, especially for those of us who considers democracy to be of fundamental value and who also realises that a capitalist economy will lead to the best economy and is also the most just of economic systems. I think Samuelson and Erixon are wrong. It’s certainly true that it’s difficult to win elections on right wing reformist agendas, especially if there’s no acute sense of crisis among the people. People are, for understandable reasons, unwilling to give up benefits that they have, for promises of a better future – especially when that future will require something from them in order to fulfil those promises. The fact that there is no such thing as status quo is not an easy message to get through.
But I still remain optimistic. It is obviously true that, if there is a sense of crisis, people are willing to elect leaders who offers a real means to get them out of it. The elections of Thatcher in the United Kingdom, and of Reagan in the the United States, proves this. To win with such an agenda without a crisis though is indeed difficult and requires a lot of hard work and – highly important – a way to present this idea of free markets and deregulation as something positive and not just as a quick fix to problems. I think it can be done. Hopefully someone will prove me right.