Europe under Merkel IV: Balance of impotence

Appeared in American Affairs Journal Volume II, Number 2 (Summer 2018): 162–92.

Europe, as organized—or disorganized—in the European Union (EU), is a strange political beast. It consists, first, of the domestic politics of its member states that have, over time, become deeply intertwined. Second, member states, which are still sovereign nation-states, pursue nationally defined interests through national foreign policies within intra-European international relations. Here, third, they have a choice between relying on a variety of supranational institutions or on intergovernmental agreements among selective coalitions of the willing. Fourth, since the start of the European Monetary Union (EMU), which includes only nineteen of the EU’s twenty-eight member states, another arena of European international relations has emerged, consisting mainly of informal, intergovernmental institutions looked at with suspicion by the supranational EU. Fifth, all these are embedded in the geopolitical conditions and geostrategic interests of each nation, which are related in particular to the United States on the one hand and to Russia, Eastern Europe, the Balkans, the Eastern Mediterranean, and the Middle East on the other. And sixth, there is at the bottom of the European state system an ongoing battle for hegemony between its two largest member countries, France and Germany—a battle that both deny exists. Each of the two, in its own way, considers its claim to European supremacy to be only just and indeed self-evident, Germany so much so that it doesn’t even recognize its ambitions as such.1 Moreover, both would-be hegemons are aware that they can realize their national projects only by incorporating the other within them, and for this reason they present their national aspirations as “European integration” projects based on a special relationship between Germany and France. (…)

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The fourth power?

Review of Joseph Vogl (2017), The Ascendancy of Finance, trans. Simon Garnett, Cambridge: Polity Press.
First published in German as Der Souveränitätseffekt (2015), Zürich-Berlin: diaphanes.

Appeared in New Left Review 110, March-April 2018, pp. 141-150

Like blood in Goethe’s Faust, money ‘is a very special fluid’. It circulates in the body political-economic, whose sustenance depends on its liquidity. [1] And it is surrounded by mystery. In fact, money is easily the most unpredictable and least governable human institution we have ever known. Allegedly invented as a general equivalent, to serve as an accounting unit, means of exchange and store of value, it has over time penetrated into the remotest corners of social life, constantly assuming new forms and springing fresh surprises. Even Keynes had to admit that his attempt at A Treatise on Money (1930) ran into ‘many problems and perplexities’. How money came to be what it is today, in capitalist modernity, may perhaps with the benefit of hindsight be reconstructed as a process of progressive dematerialization and abstraction, accompanied by growing commodification and state sponsorship. But how money functions in its present historical form is more difficult to say; where it is going from here, harder still. This social construction has always been beset with, and driven by, unanticipated consequences—caused by human action, but not controlled by it. (…)

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One Question: Marx at 200

Interview by Cihan Aksan with John Bailes and leading thinkers,State of Nature, May 7, 2018

Wolfgang Streeck: As a student of sociology in Frankfurt at the end of the 1960s, I encountered Marx early. Unfortunately, however, nobody prevented me from getting in at the wrong end: the first chapters of Capital. This was too abstract for a twenty year-old from the provinces, with a pent-up need for concrete real-world experience.

It was only much later that I returned to Marx, when I was teaching at an American university, UW-Madison. There I became aware of the breathtaking complexity of Marx’s Hegel-trained conceptual apparatus, which surpasses everything that was produced at the time and later in social science, and which is uniquely suited to observe and represent conflicts, dilemmas, or ‘contradictions’ in social life. On this background I realized why the attempt had failed and had to fail to develop a theory (and practice) of the social-democratic governance of ‘modern’ societies with the help of a functionalist sociology and empiricist political science. (…)

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Other answers by: Ursula Huws, Sven-Eric Liedman, Terrell Carver, Jayati Ghosh, Frigga Haug, Lucia Pradella, Neil Faulkner, Lars T Lih, Esther Leslie, Guilherme Leite Gonçalves, Michael Roberts.

Review: Bruno Amable, „Structural Crisis and Institutional Change in Modern Capitalism: French Capitalism in Transition“

Review of Bruno Amable (2017), Structural Crisis and Institutional Change in Modern Capitalism: French Capitalism in Transition, Oxford: Oxford University Press.

Appeared in ILR Review 71 (2), 2018, 550-552.

This book is historical-institutionalist political economy at its best. Obviously it is on industrial relations, but it is also, as it should be, on capitalism and the state, on politics and markets, and most important, on their dynamic over time. One thing that we learn (unless we have learned it previously) is that industrial relations cannot be understood outside of its capitalist-political context, and it must be conceived as a story, a movie, not a still, embedded in the long history of modern capitalist society. That history, quite appropriately, can be recounted as one of “modernization,” but not in the 1950s and 1960s American sense in which it stands for quiet, steady, universal, and basically self-driven development toward ever-higher levels of prosperity, democracy, and general happiness. Rather, what Bruno Amable identifies as modernization is a political project of a state under capitalism trying to design a regime that overcomes the dysfunctions of liberalism while avoiding the lure of socialism or communism—a perennial political search for a “Third Way” and for a political coalition capable of sustaining it that goes back to the beginning of capitalist industrialization in the 19th century. […]

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What about capitalism? Jürgen Habermas’s project of a European democracy

Review of Jürgen Habermas, The Lure of Technocracy, Polity: Cambridge, 2015

European Political Science, Vol. 16 (2017), No. 2, 246-253. Manuscript finished January 18, 2016.

The book to be reviewed here – The Lure of Technocracy – is Jürgen Habermas’ latest statement on Europe, its crisis, its politics and its prospects. It is the English translation – a remarkably good one – of Im Sog der Technokratie (Habermas 2013). The German original came out as Volume XII of Kleine politische Schriften, a series that dates back to 1980 and which, according to Habermas (2013, 10), it is to conclude. The twelve volumes, all of them collections of occasional papers, interviews and public lectures produced alongside Habermas’ main works, have long become an object of wide admiration, in Germany and beyond, for their unique combination of political activism, profound scholarship and, not least, brilliant essayistic prose, and they can already now claim a prominent place in the political and cultural history of postwar Germany. The Lure of Technocracy consists of ten pieces from the last three or four years, seven of them more or less directly concerned with European integration and its crisis since 2008. (…)

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Are we heading for another economic crash?

Interview by Cihan Aksan with John Bailes and leading thinkers, State of Nature, January 15, 2018

Wolfgang Streeck: I’m not a prophet. But there is no capitalism without the occasional crash, so if you will we are always heading for one. Inflation in the 1970s was ended by a return to ‘sound money’ in 1980, which begot deindustrialization and high unemployment, which together with tax cuts for the rich begot high public debt. When public debt became too high, fiscal consolidation in the 1990s had to be compensated, for macro-economic as well as political reasons, by capital market deregulation and private household debt, which begot the crash of 2008.

Now, almost a decade later, public debt is higher than ever, so is private debt; the global money volume has been steadily increasing for decades now; and the central banks are producing money as though there was no tomorrow, by buying up all sorts of debt with cash made ‘out of thin air’, which is called Quantitative Easing. While everybody knows that this cannot go on forever, nobody knows how to end it – same with public and private debt, same with the money supply. Something is going to happen, presumably soon, and it is not going to be pleasant. (Read other answers)

Other answers by: Cédric Durand, Susan Newman, David M. Kotz, Minqi Li, Mary Mellor, Andrew Ross, Tim di Muzio, Dario Azzellini, Ying Chen, Richard Murphy, Michael Roberts, Lena Rethel and Heikki Patomäki.

The Future of Capitalism

Podcast about the trajectory of capitalism and democracy, Center for Urban Research and Austerity, January 15, 2018

A talk with Wolfgang Streeck, Professor emeritus of sociology. From 1995 to 2014 he was Director at the Max Planck Institute for the Study of Societies in Cologne, Germany. His latest book is How Will Capitalism End? Essays on a Failing System (Verso, 2016).

Drawing widely on classics from Schumpeter, Polanyi and Marx, Streeck offers an account of the lineage of democracy, capitalism and the state since the post-war period, identifying the deeply de-democratising and self-destructive trajectory in contemporary capitalist development. Against liberal received wisdom, Streeck argues that democracy and capitalism are anything but natural partners or easy bedfellows, but have in fact been in constant historical tension. The post-war social democratic settlement represents an unusual “fix” to this tension that was relatively favourable to the popular classes, or “wage dependent”, parts of the population. However, this fix unravelled in the 70’s as the capitalist, or “profit-dependent”, class rediscovered its agency and, with neo-liberal globalisation and financialisation, began to shape a world in its interests.

Streeck argues that these processes are putting in danger not only the existence of democratic politics, which is increasingly circumscribed by the need for states to appease financial markets, but also the future of capitalism itself. Streeck’s vision for what is to come is gloomy. Capitalism continues to erode the social foundations necessary for its own sustenance, as well as the resources needed to collectively construct an alternative order. Institutional and policy fixes to capitalist contradictions are running out. We can expect the result to be the development of an increasingly uncertain and under-institutionalised social order, reminiscent of a Hobbesian state of nature, where individual agency and creativity becomes fundamental to meet basic needs and achieve even minimal goals. Politics offers hope of rupture, but is itself increasingly constrained and defiled by capitalist development and rationality. (Podcast on soundcloud or itunes)