Will neoliberalism ever become possible in the USA? Is there a movement toward green social democracy that would defeat authoritarian nationalism? This article considers economic factors and class forces that will affect the outcome in the approaching years, along with the lessons for the left.
If Joe Biden is going to make his first attempt at progressive reform what will it be like for this Trump administration to do? This assessment of the prevailing economic conditions in the United States reveals both opportunities and obstacles that the left will face in their efforts to move policy toward the widely popular agenda of the Bernie Sanders campaign. This article argues that the current condition of US capitalism makes a major change in direction toward progressive policies possible. At the same time, the consequence of a failure to shift US policy away from decades of neoliberalism would likely be an even more retrograde future.
What are current economic conditions and the possibilities they generate requires taking into account the interplay of continuity and change in capitalism over time. Why has capitalism taken it’s institutionalized forms? The monopoly stage of capitalism arose around 1900, superseding the previous small-business competitive capitalism. After World War II, regulated (or social democratic) capitalism emerged and lasted until the 1970s. Then the neoliberal form of capitalism emerged around 1980 with the help of the US government. In each period the system remained capitalist but, at a more concrete level, many of the institutions, as well as the dominant ideas, changed from one regime to another.
The institutions and dominant ideas of each previous form of capitalism promoted capital accumulation and economic expansion for several decades, but eventually the contradictions of each form gave rise to a structural crisis in which the existing regime no longer promoted normal accumulation. According to the definition of such structural crises, these crises have brought some combination of prolonged economic stagnation, a falling rate of profit, and heightened economic instability. History suggested that a structural crisis continues until a new institutional form of capitalism emerges that again promotes normal capital accumulation. This is a great example of this period. Hence, every institutional form can be called a social structure of accumulation (SSA).
During the period in which a regime of capitalism is working “effectively”, it is difficult to change the policy trajectory in a way that is inconsistent with the dominant institutions and ideas. How a change of political power had little impact on the overall policy direction in the United States during World War II. In the neoliberal era, the Democratic US presidency of Bill Clinton and Labour Party rule under Tony Blair in the UK extended and deepened neoliberalism, despite promises to the contrary during their respective election campaigns.
Once an institutional form of capitalism enters its crisis phase, however, a change in direction makes its way onto the agenda. The Great Recession followed the collapse of neoliberalism, while debt and banking was the dominant force. The restructuring phase of financial system continued even after that, now that many analysts have argued that the financial system was overachieving and undervaluation has not existed. This has important implications for assessing the possibility of moving towards a progressive agenda in 2021. In such a structural crisis period, competing proposals for major change suddenly move from the political fringes into the mainstream, as happened in the 1920s and 1930s. Is authoritarian nationalism more prevalent in developed countries than industrialized countries? During the 2016 presidential election, Senator Bernie Sanders, running as a socialist, appeared to keep running for President. In 2020, he suddenly became a popular and famous front-runner for the nomination.
This article first analyses economic development since 1980 and their consequences that have brought us to the present conjuncture, including the impact of the COVID-19 pandemic. Next we will consider the implications for the ability of the Left to effectively promote a progressive shift in policy direction in the United States in 2021, as well as the dangers that loom if the left fails in that effort.