Neoliberalism and The Crisis for Democracy

December 22, 2024

For at least three decades now, the term “neoliberalism” has come into such prominence in discussing global economics and its effect on the respective countries, that the term can no longer be ignored. Many bourgeois economists, media commentators and even journalists, have attempted to define and analyze this concept; more often than not it has led to confusion and misinformation. We think it is appropriate to begin our examination of this phenomenon, by first defining what it means in actual, practical terms. In the long run it is the working class who will need to understand this concept fully; so that they do not support actions and policies that are against their own interests.

The Theory and Practice of Neoliberalism

Neoliberalism began to creep into the public narrative in the 1970’s especially during the Bill Clinton Administration; adopting the neoliberal ideology that the “market” can be modified or transformed from being self-serving, to a more “sympathetic” type of capitalism. In that regard all the devices used to promote capital were introduced: deregulation, increased privatization, abandonment of social programs, discouragement of organized labor militancy and the unregulated movement of finance and capital. The erroneous conclusion of this theory and practice is that these Policies, are in the interest of the overall economy and benefits will “trickle” down to the working class. The fallacy of this is self-evident; it was and is an ill-conceived concept because it is antithetical to the structure and aim of capitalism.

The role of the state in this practice is critical in its anchoring, securing and expansion of its aims and interests; neoliberalism requires a strong and decisive state, which will relentlessly pursue and work for the benefit of capitalism’s interests. Neoliberalism today has no qualms about displaying its preference for the obscenity of capitalism, whether it is the attack on Trade Unions, the suppression of any reference or move toward socialized affordable Health Care, demonization of working class activism, the absence of free Child Care, tax cuts for the big corporations and a Foreign Policy fueled by interventions and militarism.

Neoliberalism globally has run into a “dead-end.” The overproduction of goods normal in capitalist operations and inflationary prices especially in stocks or real estate, are not supported by the demand for these products. When this situation occurs it throws the economy back and further into a crisis, because of the uneven relationship between real wages and the demand for goods and services. Because of the production surplus, “real” wages are not increasing enough to keep up with the level of productivity, which results in the working class being unable to buy back the goods they produced. Overall demand is decreased and worst case scenario, unemployment develops.

To overcome this crisis of neoliberal capitalism, it is necessary that the state incurs a deficit or tax the capitalists in order to stimulate the economy. However, Finance Capital is generally opposed to direct state intervention by the government as a way of increasing employment. Large-scale state spending can only increase employment by deficit and taxes on the capitalists; but these are precisely the two modes of financing that Finance Capital opposes. The root of their opposition lies deeper in social consideration. If neoliberal capitalism becomes dependent on the state to create jobs directly, then the behavior of the state undermines the social “legitimacy” of capitalism. Also, if the government can do the job of providing wholescale employment, then why are capitalists needed at all? Those are the ideological dangers neoliberal capitalism faces.

The Crisis Facing Bourgeois Democracy

In times of deep economic crisis, capitalism historically has put the burden of solving the crisis on the backs of the working class. When this cannot be achieved by normal, legal, or bourgeois liberal parliamentarian means, it resorts to desperate and extreme measures. These measures come to fruition when there is a weak and confused Left, and a disorganized working class; these are fertile grounds for authoritarian and fascist measures. Rob Urie writing in CounterPunch in 2021 said “neoliberalism is fascism with better manners.” Global capitalism is challenged and in decline; the United States’ hegemony is challenged, weakened and in decline; US imperialism must stop this “hemorrhaging” and assert its great power chauvinism obsession, in walks Donald J. Trump.

In times of economic crisis and declining “spheres of influence” capitalism is forced to adopt to the new conditions, in order to preserve and legitimize its existence; it must develop,  implement and enforce new methods for the rule of capital. As circumstances dictate it cannot allow even meagre democratic gains to be afforded to the working class; it cannot allow political dissent and labor activism to challenge the foundations of capital; it cannot allow its overseas markets to shrink because of working class activism and liberation movements coming into power; it cannot allow international solidarity with oppressed and colonized peoples. Capitalism must act decisively against these progressive currents; in doing so it turns to the most ideologically backward, politically reactionary, and narrow nationalistic section of the ruling class. Donald J. Trump is the embodiment of this type of theory and practice; Donald Trump is the representative and “hatchet man” for this section of the ruling class.

Capitalism is distrustful of the “constitutional” bourgeoise both within and outside the Democratic Party, who they fear will relent to pressure from activism. Whether it is called authoritarianism or fascism, the classical definition of fascism is still relevant today: It is the “open terrorist dictatorship of the most reactionary, most chauvinistic and most imperialist elements of finance capital.” The attempted coup of January 6, 2021 at the US Capitol; the continued restrictions and challenges to the Voting Rights Act; the suggestion to use the military to suppress dissent and activism; the demonization of sections of the media and the hint that constitutional amendment is not out of the question when the rule of capital is threatened, are all signs of capitalism’s desperation to save face and gain ground.

Authoritarianism and fascism comes into being when the Left is not strong enough to provide clear and organized leadership which galvanizes the working class and offers a progressive  alternative to the masses; in order to move them from the exploitation and oppression of capitalism in all its forms.

Paul Bogle Action Network (PBAN) is an organization of concerned Jamaicans, helping to facilitate the development and nurturing of working-class organizations in Jamaica where absent; and where they exist, strengthen their focus. Questions and information request can be sent to: paulbogleactionnetwork@gmail.com