Review: Buying Time by Wolfgang Streeck

January 22, 2015
Buying Time by Wolfgang Streeck (Verso, £14.99)

Democracy or capitalism? That is the stark choice Wolfgang Streeck confronts us with at the end of Buying Time. Based on his 2012 Adorno Lectures, this important, challenging book from the Director of the Max Planck Institute, locates the interlocking democratic, fiscal and economic crises confronting Europe today as the end point of the long transformation of postwar capitalism. That process began in the 1970s when, contrary to the Frankfurt School’s crisis theories capital, not labour, revolted against the constraints of democratic capitalism and began its dissolution. The history of capitalism, as Streeck charts it, has subsequently been the history of capital’s escape from the institutions and regulations imposed on it after 1945, with the market economy increasingly insulated from democratic pressures, and democracy hollowed out of authority or popular purchase.

Throughout this transformation, distributional conflict was delayed by “buying time with money.” Inflation, public debt and rising private indebtedness each in turn defused potentially destabilising social struggle—but each strategy exhausted itself after roughly a decade, most recently in the financial crisis of 2007/08. In the process, the tax state transformed into a debt state and finally, today’s consolidation state, where the locus of sovereignty has increasingly shifted to what Streeck terms Marktvolk, with the financial interests of creditors trumping a state’s responsibilities to voters. The scathing demolition of the “frivolous experiment” of the euro in aiding this transformation is particularly impressive.

What comes next is unclear. However, Streeck suggests the most likely outcome will be the ongoing “Hayekisation of European capitalism and its state system,” a world of capitalism without democracy; market justice without social justice. For anyone interested in understanding the bind democracies are in, this is a vital if sobering book which has a troubling, if convincing, conclusion.