The global free market economy will inspire a countermovement-just as it did 100 years ago. David Marquand and the political economists he reviews here agree about that. But will we have to chose between the free market and the free society?by David Marquand / July 20, 1996 / Leave a comment
We live, we are told, in a new world on which old theories have no purchase. Globalisation is dissolving national frontiers and nation states. Industrial processes are post-Fordist, mentalities are post-modern and societies are multicultural. Jobs for life have disappeared; the working class has been hollowed out; the labour force has been feminised; the family has been transformed; and old elites have been toppled. The collectivism of the past has been replaced by a new individualism, and the social democracy of the postwar period has become unworkable.
To this eager chorus there is only one sensible response: “Up to a point, Lord Copper.” Of course, we live in a new world: each new generation lives in a world new to it. John Donne famously complained that “the new philosophy calls all in doubt.” De Tocqueville called for a “new science” to explain the novelties of the 19th century. Plato, Hobbes and Burke, the great philosophers of conservatism, wrote in reaction to the flux and insecurity of revolutionary change. It is true that the world of the 1990s differs from that of the Keynesian golden age which is still the unconscious reference point for most people over 35. But it is not true that the golden age was in some sense the norm, from which our own age is an extraordinary and unprecedented aberration. On the contrary, the age of Keynes, Beveridge, Bretton Woods and the sunlit uplands to which they pointed was the aberration. As all these books remind us, the norm is what has followed since-and what went before.
The heaving, masterless, global economy of the 1990s differs from its benign and stable predecessor of the 1950s and 1960s, but it has a great deal in common with that of the 19th century and something in common with that of the interwar period. Keynes may be dead, but Marx and Malthus have had a new lease of life. The tamed welfare capitalism that Keynes helped to create may have vanished, but the untamed capitalism of today is reminiscent of much earlier phases in the creature’s life cycle.
This applies most obviously to the deflationary bias that now bears down on economic activity through all the peaks and troughs of the business cycle. The fundamental Keynesian (and Marxist) paradox of under-utilised resources in the midst of unsatisfied needs has returned. So has that old faithful of Marxian wage theory,…