Saving liberal democracy from the extremes
Elites must recognise that mismanaged economies have helped to destabilise politics
Martin Wolf
Protesters in Warsaw in July, angry at what they see as an attack on the judiciary © AFP
Nothing to excess”. This motto, also known as “the golden mean”, was displayed in the ancient shrine of Delphi. Such restraint is particularly crucial for the preservation of liberal democracy, which is a fragile synthesis of personal freedom and civic action. Today, the balance between these two elements has to be regained.
Larry Diamond of Stanford University has argued that liberal democracy has four necessary and sufficient elements: free and fair elections; active participation of people, as citizens; protection of the civil and human rights of all citizens; and a rule of law that binds all citizens equally. The salient feature of the system is the restraints it imposes on the government and so on the majority: any victory is temporary.
It is easy to see why this system is so fragile. Today, that truth is, alas, not theoretical. In its 2018 report, Freedom House, a well-regarded federally funded, non-profit US organisation, stated that: “Democracy is in crisis. The values it embodies — particularly the right to choose leaders in free and fair elections, freedom of the press, and the rule of law — are under assault and in retreat globally.” This “democratic recession”, as Prof Diamond has called it, is not restricted to emerging or former communist countries, such as Hungary or Poland. The commitment to norms of liberal democracy, including the right to vote and equal rights for all citizens, is in retreat even in the established democracies, including the US. Why has this happened?
In a recent book, The People vs. Democracy, and an earlier article, Yascha Mounk of Harvard University argues that both “undemocratic liberalism” and “illiberal democracy” threaten liberal democracy. Under the former, democracy is too weak: social bonds and economic security are sacrificed on the altar of individual freedom. Under the latter, liberalism is too weak: power is captured by demagogues ruling in the name of an angry majority or at least a sizeable minority, who are told they are the “real people”. Undemocratic liberalism ends in elite rule. Illiberal democracy ends in autocratic rule.
Mr Mounk’s argument, moreover, is that undemocratic liberalism, notably economic liberalism, largely explains the rise of illiberal democracy: “vast swaths of policy have been cordoned off from democratic contestation”. He points to the role of independent central banks and to the way in which trade is governed by international agreements created by secretive negotiations carried out inside remote institutions. In the US, he also notes, unelected courts have decided many controversial social issues. In such areas as taxation, elected representatives retain formal autonomy. But the global mobility of capital restricts the freedom of politicians, reducing the effective differences between established parties of the centre-left and centre-right.
How far does such undemocratic liberalism explain illiberal democracy? The answer is: it does, up to a point.
It is surely true that the liberal economy has not delivered what was hoped, the financial crisis being a particularly severe shock. One aspect of such liberalism — migration — has, as the British writer David Goodhart argues in his book, The Road to Somewhere, persuaded many “people from somewhere” — those anchored to a place — that they are losing their countries to unwelcome outsiders. Moreover, institutions that represented the bulk of ordinary people — trade unions and left-of-centre parties — have ceased to exist or ceased to do their job. Finally, politics has been taken over by “people from anywhere” — the mobile and the highly educated.
Thomas Piketty suggests that a “Brahmin left” and a “merchant right” now dominate western politics. These groups may differ sharply from each other, but both are attached to liberalism — social, in the case of the Brahmins and economic, in the case of the merchants. The public has noticed.
A big point is that if undemocratic liberalism has gone too far for the comfort of a large portion of the voting public, that liberalism is not just economic: this is not just about neo-liberalism. Moreover, little of it has to do with overmighty international institutions, with the arguable exception of the EU. Indeed, the prosperity high-income countries desire is heavily bound up with international commerce. That, in turn, necessarily involves more than one jurisdiction. A future that does not include international co-operation on cross-border regulation or taxation will not work. This, too, has to be recognised.
A view that the economic dimension of undemocratic liberalism has driven the people towards illiberal democracy is exaggerated. What is true is that poorly managed economic liberalism helped destabilise politics. That helps explain the nationalist backlash in high-income countries.
Yet the kind of illiberal democracy we see in Hungary or Poland, which is rooted in their specific histories, is not an inevitable outcome in established democracies. It will be hard for Donald Trump to become a US version of Hungary’s Viktor Orban.
Yet we cannot just ignore the pressures. It is impossible for democracies to ignore widespread public anger and anxiety. Elites must promote a little less liberalism, show a little more respect for the ties binding citizens to one another and pay more tax. The alternative of letting a large part of the population feel disinherited is too dangerous. Is such a rebalancing conceivable?
That is the big question.
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