[Marxism] Vintage Sheasby

Louis Proyect lnp3 at panix.com
Sun Aug 22 05:59:03 MDT 2004


Progressive Populist, Feb. 1996

CREATING A NEW MAINSTREAM: THIRD PARTIES '96 AND THE UNREPRESENTED MAJORITY
BY WALT CONTRERAS SHEASBY

(clip)

The end of corporate liberalism

At issue, really, is the rightward-shift of many political parties that 
once restrained and regulated their national corporate managers in the name 
of an over-arching corporate social liberalism dubbed the Welfare State, or 
the Social Contract, or the Full Employment Economy.

This shift to a New Paradigm, as rightist James Pinkerton calls it, of 
unbridled exploitation (so-called Free Markets), has affected virtually 
every liberal, labor, social democratic, and ex-communist party in the 
world since the toppling of the Berlin Wall in 1989, but it was occurring 
long before that. During the long boom, regulated and pump-primed and 
socially progressive Western economies were useful as corporations moved 
into a postwar globalism vexed and harassed by cold war rivalries.

As Antony Crosland told the British Labour Party in 1956, "The voters, now 
convinced that full employment, generous welfare services and social 
stability can quite well be preserved, will certainly not relinquish them. 
Any government which tampered with the basic structure of the 
full-employment Welfare State would meet with a sharp reverse at the polls."

However, by the end of the long wave of postwar expansion in the early 
1970s, with the onset of stagflation and a declining rate of profit, the 
Keynesian demand-side stimulation was being replaced by a Friedmanesque 
anti-inflationary zeal to match the employers' offensive against labor.

The change was announced at a 1976 British Labour Conference by James 
Callaghan: "We used to think that you could spend your way out of a 
recession and increase employment by cutting taxes and boosting government 
spending. I tell you in all candour that that option no longer exists, and 
even insofar as it did ever exist, it only worked on each occasion by 
injecting a larger dose of inflation into the economy, followed by a higher 
level of unemployment as the next step." (New Left Review, May/June 1995)

The actual relationship of price trends and employment trends turned out to 
be much more uncertain and complicated, but there was no denying the 
ideological impact of Milton Friedman's Capitalism and Freedom (Univ. of 
Chicago Press, 1962) and other conservative attacks on Keynesianism. 
Economist Robert A. Levine notes that, "Too many economists, including 
previous followers of Keynes and Heller, have justified the abandonment of 
growth-oriented fiscal policies by bowing to the principles of an economic 
conservativism that is really a return to the world of the 1920s. The 1980s 
and '90s have seen a revival of pre-Keynesian economics, avowing that 
government cannot push the creation of jobs." (L.A. Times, June 24, 1995)

The abandonment of Keynesian macro-economic policies and corporate-liberal 
politics coincided with the end of the long profits boom and the onset of a 
decline in the profit rate. This decline compelled business offensives 
against labor's bargaining power, privatization of state owned enterprises 
and deregulation, cuts in the social wage and welfare, and ultimately tax 
measures to redistribute income upward. Robert Brenner points out that 
between 1966-1973, the rate of return on fixed capital investments in 
manufacturing fell by 25% in the leading six capitalist economies, and by 
35% in the United States. By the early-mid 1980s, it had fallen by a 
further 33% in the leading six and by a further 40% in the United States. 
And there has been no recovery since. (Against the Current, May/June 1995)

In the U.S., social programs instituted and funded by previous Democratic 
and Republican administrations since FDR and the New Deal were on the 
cutting block. Only Pentagon spending remains as the last sacred cow of 
Keynesian pump-priming of aggregate demand and job creation.

Decay of the Democratic Party

Richard N. Goodwin, an architect of both Kennedy's New Frontier and 
Johnson's Great Society, has acknowledged the transformation: "The collapse 
of the Democratic Party--an institution now without ideology or animating 
belief, a party without a cause and therefore without meaningful 
existence--should be cause for mourning. ... In the 27 years since 1968, 
the country and its afflictions have taken a very different form, but the 
Democratic acolytes of liberalism have failed to change, have, indeed, 
become captive to the lusts of the same large economic interests they once 
gloried in fighting or at least tempering." Goodwin welcomes "the prospect 
of a new political movement outside the present party structure" hoping 
that it "will be led by progressive and populous forces." (L.A. Times, Jan. 
13, 1995)

Manhattan Institute historian Fred Siegel has also written about the 
twilight of the Democratic Party: "Clinton's promise in the campaign was 
that in his person, he would resolve the longstanding contradictions in the 
party. In the end, they're not resolvable." (L.A. Times, June 14, 1993)

Testimony to that effect was provided by U.S. Chamber of Commerce 
vice-president, Jeffrey H. Joseph, who confessed that, in lobbying the 
Clinton Administration, big business "didn't win everything we wanted, by 
any means, but the unions got nothing they really wanted." (L.A. Village 
View, April 14, 1995)

As Jerry Brown said, "Labor contributed $20 million to the Democratic 
Presidential campaign and achieved 0 for 5 (NAFTA, GATT, strike protection, 
minimum wage increase and labor law reform." (Labor Party Advocate, 
February 1995)

Eric Mann, director of the Labor/Community Strategy Center in Los Angeles 
and author of a forthcoming book entitled Revolutionary Organizing in the 
Age of Reaction, sums up the record of the Democratic Party's conscious 
shift to the right: "On every major structural development of world 
capitalism--the imposition of a world market dominated by the United 
States, Germany and Japan; the ruthless role of the I.M.F., GATT and NAFTA 
... the movement toward a worldwide low-wage and high unemployment economy; 
the failure to restrict corporations through non-negotiable ecologically 
driven mandates; the abandonment of low-income communities of color; the 
end of unions as we know them, replaced by dictatorial structures of 
`labor-management cooperation'; the racialization of and criminalization of 
poverty; the scapegoating of immigrants--the Clinton team is virtually 
indistinquishable from Reagan/Bush." (The Nation, June 13, 1994)

Recently millionaire Republican Mike Huffington complained, "Clinton stands 
for welfare reform and so do we. He says we have to solve the Medicare 
problem and so do we. But he's using more effective words than the 
Republicans (L.A. Times, Jan. 2, 1996)

In fact, the Clinton administration has initiated the kind of deficit 
slashing and De-inventing Government cutbacks that would have met 
overwhelming opposition if pushed by a G.O.P. White House. As conservative 
Republican economist Murray Weidenbaum put it, "If it was only Richard 
Nixon who could go to China, perhaps only Bill Clinton can bite a similarly 
tough domestic bullet." (L.A. Times, Jan. 17, 1993)."

In one way or another, the same ideological shift occurred in most 
political parties espousing a form of corporate social liberalism designed 
to lift all boats, or as Andrew Glyn puts it, a "deficit financed expansion 
in which the unemployed, wage earners and capitalists all gained. (New Left 
Review, May/June 1995)

full: http://www.populist.com/2.96.Mainstream2.html





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