The crises of democratic capitalism

New Left Review

Volumn , Issue 71, 2011, Pages 5-29

  Streeck, Wolfgang ^a  

^a NONE

Author keywords

[No Author keywords available]

Indexed keywords

EID: 80054750332     PISSN: 00286060     EISSN: None     Source Type: Journal    
DOI: None     Document Type: Article

References (20)

1. For the term 'Great Recession', see Carmen Reinhart and Kenneth Rogoff, This Time Is Different: Eight Centuries of Financial Folly, Princeton 2009.
2. The classic statement is James Buchanan and Gordon Tullock, The Calculus of Consent: Logical Foundations of Constitutional Democracy, Ann Arbor, mi 1962.
3. See Edward Thompson, 'The Moral Economy of the English Crowd in the Eighteenth Century', Past & Present, vol. 50, no. 1, 1971
4. James Scott, The Moral Economy of the Peasant: Rebellion and Subsistence in Southeast Asia, New Haven, ct 1976. The exact content of such rights obviously varies between different social and historical locations.
5. In a seminal essay, Michal Kalecki identified the 'confidence' of investors as a crucial factor determining economic performance: 'Political Aspects of Full Employment', Political Quarterly, vol. 14, no. 4, 1943. Investor confidence, according to Kalecki, depends on the extent to which current profit expectations of capital owners are reliably sanctioned by the distribution of political power and the policies to which it gives rise. Economic dysfunctions-unemployment in Kalecki's case-ensue when business sees its profit expectations threatened by political interference. 'Wrong' policies in this sense result in a loss of business confidence, which in turn may result in what would amount to an investment strike of capital owners. Kalecki's perspective makes it possible to model a capitalist economy as an interactive game, as distinguished from a natural or machine-like mechanism. In this perspective, the point at which capitalists react adversely to non-market allocation by withdrawing investment need not be seen as fixed and mathematically predictable but may be negotiable. For example, it may be set by a historically changeable level of aspiration or by strategic calculation. This is why predictions based on universalistic, i.e., historically and culturally indifferent, economic models so often fail: they assume fixed parameters where in reality these are socially determined
6. John Goldthorpe, 'The Current Inflation: Towards a Sociological Account', in Fred Hirsch and Goldthorpe, eds, The Political Economy of Inflation, Cambridge, ma 1978
7. Already in the 1950s Anthony Downs had noted that in a democracy the demands from citizens for public services tended to exceed the supply of resources available to government; see for example, 'Why the Government Budget Is Too Small in a Democracy', World Politics, vol. 12, no. 4, 1960.
8. See also James O'Connor, 'The Fiscal Crisis of the State', Socialist Revolution, vol. 1, nos 1 and 2, 1970.
9. Greta Krippner, Capitalizing on Crisis: The Political Origins of the Rise of Finance, Cambridge, ma 2011.
10. David Spiro, The Hidden Hand of American Hegemony: Petrodollar Recycling and International Markets, Ithaca, ny 1999.
11. Robert Reich, Locked in the Cabinet, New York 1997.
12. Joseph Stiglitz, The Roaring Nineties: A New History of the World's Most Prosperous Decade, New York 2003.
13. Colin Crouch, 'Privatised Keynesianism: An Unacknowledged Policy Regime', British Journal of Politics and International Relations, vol. 11, no. 3, 2009.
14. Fritz Scharpf, Crisis and Choice in European Social Democracy, Ithaca, ny 1991.
15. For a representative collection see James Poterba and Jürgen von Hagen, eds, Institutions, Politics and Fiscal Policy, Chicago 1999.
16. Joseph Schumpeter, 'The Crisis of the Tax State' [1918], in Richard Swedberg, ed., The Economics and Sociology of Capitalism, Princeton, nj 1991.
17. The concepts were laid out by David Lockwood in 'Social Integration and System Integration', in George Zollschan and Walter Hirsch, eds, Explorations in Social Change, London 1964.
18. Peter Mair, 'Representative versus Responsible Government', Max Planck Institute for the Study of Societies Working Paper 09/8, Cologne 2009.
19. According to Wolfgang Schäuble: 'We need new forms of international governance, global governance and European governance.' Financial Times, 5 December 2010. Schäuble acknowledged that if the German parliament was asked to forfeit its jurisdiction over the budget immediately, 'you would not get a Yes vote'-'[but] if you would give us some months to work on this, and if you give us the hope that other member states will agree as well, I would see a chance.' Schäuble was, fittingly, speaking as winner of the ft competition for European finance minister of the year.
20. C. Wright Mills, The Power Elite, Oxford 1956.