03 July 2013

Rand Paul could redefine American politics, straight into disaster

A path to the triumph of American reaction
Part 2 of 2 | Part 1

When a capitalist regime of accumulation breaks down, the only impractical path forward is to maintain the status quo. Fundamental change becomes necessary, but the direction of that change is not foreordained. Progressive change is that which opens a path to overcoming the crisis. Reactionary change, on the other hand, can only intensify the disorder and leads ultimately to disaster.

If the scenario sketched out in the last post came to pass and Rand Paul rode to election in 2016 on the back of a populist coalition of fundamentalists, libertarians, and anti-authoritarian progressives, he would have to choose one of several different paths upon inauguration. He could pander to the social conservatives while the entrenched House Republican majority (probably joined by a new Senate majority) continued to push an anti-gay, anti-immigrant, and anti-abortion agenda; in that case, the Republicans would quickly lose the new constituencies the election had brought into play. Alternatively or alongside the fundamentalist path, Paul could give in to the power of his corporate backers, basically continuing the economic policies of the Obama administration with a harsher edge, and soon find himself on the defensive against a progressive challenge from the Democrats.

These options are straight out of the long-established Republican playbook, and they had real efficacy as long as neoliberalism remained healthy. Now that neoliberalism is disintegrating, however, they no longer represent a viable politics, and would gradually deepen the crisis while extinguishing the Paul administration’s legitimacy. The outcome would be an increasingly progressive and post-neoliberal Democratic Party in line with the popular progressive majority. It’s the best we could hope for in the event of a Paul victory.

The really frightening prospect is that Rand Paul actually means what he says and seeks to make good on the hopes of his anti-authoritarian supporters on both the left and the right. Because in that case, he might be able to remake the Republican Party as a populist force capable of confronting and destroying the corporate-state elite. In the process, the only hope for overcoming the crisis of neoliberalism in a progressive direction would be extinguished, and the world would move ever-closer to real disaster.

How might a transformational Rand Paul administration come into being? The 2016 post-election analysis would show that young white progressives and libertarians both went overwhelmingly for Paul. (As Paul has already pointed out, with much justification, “The youth are attracted to people who don’t want to lock them up and throw away the key for marijuana. In some ways, the older Democrats have become more staid and status-quo-like than some of us Republicans.”) Blacks and Latinos would still give a comfortable majority of their votes to Clinton, but Paul would improve greatly on Romney’s lamentable numbers: his criticism of the drug laws and the crisis of unjust incarceration in minority communities would sound a note of hope against Clinton’s lame platitudes. Clinton’s big advantage among women would keep the election close, but the patterns among the young—voting in record numbers—would signal a shift underway.

The election of 2016, like those of 1932 and 1980, would come to mark an epochal realignment of the American political landscape. In the politics of late neoliberalism, divisions were drawn along lines of lifestyle: the worldly and diverse coastal elite, fancying themselves compassionate and thereby drawing the support of those increasingly superfluous to the economy (organized labor and the underclass), were pitted against the intolerant, evangelical, and free market fundamentalists of the South and the rural areas. In this politics, the state and the big corporations—large, entrepreneurial, and market-mediated bureaucracies, which formed the structural foundation of neoliberalism—were the very grounds of politics, and so disappeared from view.

As the Tea Party and Occupy demonstrate (not to mention rising populist currents from Brasil to Europe to Russia to China), the crisis has already thoroughly decomposed that system, which survives only in the anachronistic refusal of political leaders all over the world to forge ahead in different directions. The emerging fault line of politics is not lifestyle but power and privilege: elites in the state and large corporations and those with access to them on one side, arrayed against the marginalized, the excluded, the hopeless, the superfluous. The ranks of the latter, fairly stable and easily contained as long as neoliberalism produced growth, are now steadily expanding, drawing in more and more former members of the decaying middle class and their educated, debt-burdened children who see nothing but a bleak future ahead.

Existing populisms of both left and right are focused not on some vision of a new society but solely on the negation of neoliberalism in all its forms. As I wrote last year:
against the free movement of labor, populism poses anti-immigrant bile; against the free flow of capital it demands capital controls, financial transaction taxes, currency manipulation; against the free trade agenda it looks to protectionism and state retaliation against “cheaters”; against the rootless cosmopolitanism born of globalization it celebrates the local, the particular; against the abstract placelessness of financial flows it asserts the concrete immediacy of life in a particular city or nation; against the experience of the atomized consumer it hungers for a feeling of community and transcendent meaning.
Increasingly, however, populists from both the left and right may be converging on a single agenda: that of destroying the corporate-state elite. The political program for such a goal looks very similar to Rand Paul’s agenda, namely, restrictions on militarism and the security state, decriminalization of drugs and roll-back of the incarceration state, breaking up the banks and other large corporations, ending state subsidies for corporations and other state-granted advantages to big business.

(The left and right increasingly share this agenda. The difference is that the right understands that such a program would substitute the tyranny of the market for the tyranny of big bureaucracies, while the left imagines that some sort of democratic community-based decision-making would fill the void. This is one of the few issues on which the right is far more in touch with reality than the left.)

If Rand Paul means what he says, and if he’s willing to risk destabilizing the entire society in pursuit of his principles—principles that may seem all the more compelling by 2017 as existing social arrangements show themselves to be ever-more untenable—then he could channel the roiling discontent all over the country into a frontal assault on the corporate and state bureaucracies. His success in such an endeavor would very much depend on his own skills as a politician and a leader, as well as the evolution of the Republicans in Congress, who would be more cautious if not hostile to Paul’s transformational agenda. To make the transition, Paul would have to repudiate the dying social conservative contingent, cultivating in their stead the young anti-authoritarian activists produced by his campaign as the Republican base while elevating more experienced libertarians and populist progressives into leadership positions, and at the same time bringing to bear popular pressure on the traditionalists in Congress. It would be a difficult path, but he would have a population more engaged in politics than at any time in the last three decades on his side.

I can imagine many progressives reading this post who might be thinking, “Sure, Rand Paul is no one’s idea of a good liberal. But I’ll take an anti-authoritarian who wants to rally people behind an attack on corporate power and the imperialist state any day of the week. If at the same time he gets rid of the troglodytes in the Republican Party, that would be even better. What’s so bad about this scenario?” Even such a mainstream progressive as Paul Krugman has started down this path, arguing that the key economic problem we face is the over-concentration of market power.

The answer is that Rand Paul’s populism is a quintessentially reactionary approach to the crisis. His brand of reaction is, in one sense, substantive: he is hostile to Medicare and Social Security, he favors deregulation and the supremacy of the market over human life, he is a nationalist who sets American interests ahead of the global common good. But more significantly, Paul is reactionary in the sense that he offers a robust response to the crisis, but this response is incapable of founding a viable alternative system. It is an illusion whose pursuit can only end in disaster, and there could be no greater tragedy than to channel the surging demand for change toward the dead end of reaction.

The big bureaucracies that have produced the corporate-state elite remain the foundation of our socio-economic system; destroying them would also destroy that system. In concrete terms that means the disintegration of the world economy and a catastrophic disruption to the existing global networks of production and supply, a vertiginous drop in productivity around the world alongside surging unemployment and destitution, a sharp increase in international tension and nationalist politics, new forms of imperialist conflict, and ultimately the prospect of war among the great powers. Such a future may be hard to imagine today, but we have a clear precedent: this is exactly what happened with the Great Depression and World War II.

The only progressive route out of the crisis is a populist mobilization aimed not at destroying the institutional foundations of neoliberalism but at transforming them—from exclusionary to inclusionary, from sharply unequal to egalitarian, from focused on speculative ventures among the elite to investing in the public good. We must not destroy the great corporate and state bureaucracies but impose our will on them; the global economy is not our enemy but our only hope of salvation. In future posts we will fill out these claims with greater detail and explore the implications of a genuinely progressive populist politics.

Part 1: Rand Paul’s route to victory and the transformation of the Republican Party


  1. It is very important to explain HOW to impose our will upon the "great corporate and state bureaucracies." That can only mean sharply critiquing the present forms of state and corporate power.

    For instance, the Krugman article you cite is about the Apple corporation, which took the second-largest profit of corporate America last year - almost 42 billion dollars, which is an incredible 26.7% of total revenue. They are not a big bureaucracy but the very example of the stripped-down network firm, employing only 76,000 in the US and paying almost no taxes in this country. Opposite to them at the top end of the Fortune 500 list is Wal-Mart, which employs 2,200,000 at such low wages that the employees largely depend on food stamps and other aid to survive. Their business model - just-in-time imports from China - has destroyed large swathes of American manufacturing and retail. Their neighbor at the top of the Fortune 500 is ExxonMobil, which employs about as many as Apple for very similar profits (in fact, as I recall they inaugurated the new benchmark of 40+ billion profits back in the early 2000s, a fourfold increase from earlier prevailing top profit rates). Their specific difference is a far greater capacity to lobby the US government, connected as they are to the heart of what is known as the military-industrial complex. None of these really fits the image of a great corporate bureaucracy... But you know all this, it's common knowledge. The question is how would we really transform today's major corporations, along with the most bloated sector of the US government, namely the military?

    While progressives would vote for Rand Paul on an independent ticket, they won't vote for him on a Republican ticket. The chances are too great that either chaos would ensue (as you suggest) or that the establishment will take over once he gets in, as it has with Obama. Rand Paul is more likely to continue the Gingrich tradition of destroying the Republican Party from within. I think the serious question - totally in line with your argumentation - is how to transform the current financial-industrial-military structure of the United States? The Democrats as they stand are not going to do it. The Left needs to produce a positive critique, with proposals, and put that on the Democratic agenda. Hillary Clinton will obviously not do this in our place. We need to do our version of what the Tea Party has done, not an irrationally destructive program but a critically constructive one.

  2. Thanks for your comments on corporations, I did try to signal that there's something very different about today's big corporations compared to those of the Fordist era when I referred to "entrepreneurial, and market-mediated bureaucracies". The nature of contemporary corporate organization, as well as that of the popular antipathy against it, both deserve more analysis.

    I think you're right that progressive self-identified Democrats will not vote Republican, even for the kind of iconoclastic Republican that Paul has the potential to become. But that group is a very small share of the electorate. What makes Paul so interesting and scary is his weird combination of fundamentalist and anti-authoritarian positions, which uniquely among Republicans could get him past the primaries and into a position as a viable candidate in the general election. In the context of an intensifying crisis and a transparently inadequate establishment candidate like Clinton running for the Democrats, that makes a Paul presidency a real threat. Whether he has the political skills to pull it off is a different question, too soon to answer.

    But I do think the possibility alone indicates that preventing someone like Clinton from winning the nomination for the Democrats is absolutely crucial, something I'll hopefully write on soon. And of course the key takeaway is, as you say, the urgent necessity for the left to finally produce a positive critique that can go beyond the Occupy impulse to simply secede from society.

  3. The reason that workable positive proposals are not easy to find is that there's a contradiction between free trade/free movement of capital, on the one hand, and full employment, on the other. In the post-WWII period you could have full employment because the US was industrially more advanced than any other country and was able to run large export surpluses in manufacturing, without much competition at home for mass products. So there was a lot of work in exactly that sector. European social democracies were able to obtain full employment because they had trade and capital controls, plus lots of things to rebuild after the war.

    Since then, competition has emerged with a vengeance (in our case the first threats came from Germany and Japan, now it's those plus China and many others). What's more, capitalists in search of profits have engaged in automation and outsourcing; and even more, they have largely become transnational. Actually much of US corporate activity now takes place outside the country, both industrially and in terms of where the money circulates: Apple is the very exemplar of all that but hardly alone. Transnational corporations succeed in paying almost no taxes.

    For these reasons it is not possible to "go back" to a Fordist-type configuration while maintaining the policies of free trade/free circulation of capital. Yet those are exactly the policies that have been pursued most ardently across the 20th century, with no let up in recent years (NAFTA, entry of China to the WTO, now the free trade area negotiations with Europe).

    Although it is more difficult, what we need is a national and transnational discussion of the social consequences of capital investment. In its current, almost totally unregulated state, capital investment goes to all the wrong places: finance (which is purely predatory), outsourced manufacturing (race to the bottom for everyone), automation (a brighter future for robots). A better regulatory environment could direct capital investment towards more positive social consequences, in terms of employment, environment, and co-development with our neighbors (especially contiguous Mexico). A new, non-predatory kind of cosmopolitanism could be developed. All this is sacrificed in the attempt to make ever declining profits, in a world where everyone wants to capture export markets through the most intense competition and exploitation.

    It's no wonder that major corporate and financial interests have supported the libertarian discourse: "freedom" from taxation and regulation sounds great for small businessmen and entrepreneurs, but it translates into the formation of giant corporations that are able to attain monopoly positions, like the ones I discussed above and many more (increasing bank concentration tells a similar story in finance). I will try to write up a more precise picture of monopoly and oligopoly in the present global economy. That may help to expose the real problems and open a pathway toward positive proposals.