How Will Capitalism End? Essays on a Failing System

by Wolfgang Streeck

The provocative political thinker asks if it will be with a bang or a whimper

After years of ill health, capitalism is now in a critical condition. Growth has given way to stagnation; inequality is leading to instability; and confidence in the money economy has all but evaporated.

In How Will Capitalism End?, the acclaimed analyst of contemporary politics and economics Wolfgang Streeck argues that the world is about to change. The marriage between democracy and capitalism, ill-suited partners brought together in the shadow of World War Two, is coming to an end. The regulatory institutions that once restrained the financial sector’s excesses have collapsed and, after the final victory of capitalism at the end of the Cold War, there is no political agency capable of rolling back the liberalization of the markets.

Ours has become a world defined by declining growth, oligarchic rule, a shrinking public sphere, institutional corruption and international anarchy, and no cure to these ills is at hand.

Genres: Economics, Politics, Nonfiction, Sociology, Essays, History, Philosophy

272 pages, Kindle Edition

First published October 1, 2016

Reviews

[BlackOxford · Rating 2 out of 5]

Compulsive Pontification

Streeck's academic thesis is straightforward: Capitalism has adapted successfully to the conditions it itself has created since its formation in the late 18th century. But capitalism now lacks potential responses to future crisis. Economic policy-makers, he believes, have run out of effective economic antibiotics and must simply wait for the next evolved super-bug to strike. Streeck is agnostic about the source of the next crisis - ecological devastation, inadequate consumer demand, technological stagnation, declining returns, social inequality, political un-sustainability - are certainly candidates. But believes that the end of the system which has come to dominate the planet is nigh through some combination of these, or from as yet undetected evils.

The logic supporting Streeck's argument is roughly this: The future of the world economy is not simply indeterminate but what he calls multi-morbid. That is, so many things could go wrong, there are so many bugs out there, that some of them are bound to evolve immunity, and when they do the interactions with the Body Politic and Economic will be so complex that neither economists nor national governments will have a clue about how to treat the effects. His evidence for this claim is mainly the disagreement among economists about what is likely to happen to the global economy. This disagreement, not economic facts themselves, is the foundational datum of Streeck's argument. It’s a bit like medical researchers concluding that because there are a potentially infinite number of hostile bacteria in the world, many of which we haven’t even identified yet, one of them is bound to kill all of us off.

So, as Marx predicted, capitalism will decline and fall through its own internal contradictions, of which there are many more than he realised to worry about. But what will replace capitalism won't be socialism, or any other system that we can now conceive. Instead, according to Streeck, we are heading into an economic and sociological void, an uncharted future of chaos and "social entropy" (interestingly a term of approbation that Freud had used about America in 1909. Could this be Streeck's inspiration?). This forecast seems hardly distinguishable from an economic confession of total ignorance. If read this way, much of what Streeck has to say is merely professional smoke to disguise the absence of anything meaningful at all.

He then proceeds to his institutional analysis. Our existing institutions - economic, financial, social, governmental - will be inadequate to stabilise these emerging conditions according to Streeck. He describes a global situation which is more or less the one that ensued in Russia after the break-up of the Soviet Union. In short, we're in for a rough ride and we don't have any idea of the destination. So we are not only ignorant of the future challenges, we are also ignorant of the ability of our institutions to cope with whatever these challenges might be. In other words, we don’t know which antibiotics we might need, but whatever ones they are, we don’t have them. I suppose this is an economist's version of a double negative making a positive.

Even more fundamentally, Streeck sees a "decoupling" of democracy and political economy. That is, the restraints placed on capitalism by government policy over the last century will gradually disappear. Keynes and Samuelson are out the window; but so are Hayek and Friedman. The union of democracy and capitalism has only really been operational since WWII and has now been rendered sterile, mainly through the globalisation of finance. Governments are powerless; there is no theoretical script to guide policy-making. We can now look forward to essentially unregulated, "de-socialised," capitalist activity involving increasingly corrupt practices and unjust consequences. The idea of Adam Smith that private greed is transformed into public virtue has passed its sell by date. Already the odour of decay is reaching into even the best neighbourhoods. This indeed looks a solid conclusion, but one that most educated non-economists have already made.

Although written before Trump's electoral announcement, Streeck predicts the growing power of populism, especially on the political Right. But he also predicts a dramatic rise in oligarchic power, especially in America. Trumps executive appointments of largely super-wealthy sympathisers during his first two weeks in office appears to confirm Streeck's judgment. Populism after all has nowhere to turn, when it rejects the political class, except to these oligarchs. Labour leaders have been neutralised, racial leadership is fragmented, the middle classes are confused and without effective voice whatsoever. An outstanding observation, obvious once stated, but not before. Well done Professor Streeck.

Surprisingly, Streeck has little to say about China. He dismisses the importance of both the Chinese economy and the system of Chinese state capitalism out of hand.

Surviving in this new "entropic society" will, according to Streeck, depend on four civic virtues: coping, hoping, doping, and shopping. Essentially these involve believing in God but tying your camel first and having a stash at hand for socialising at the mall when the camel gets nicked. Economists are not known for their irony, so I have to take him seriously in these suggestions

The End of Capitalism is the ultimate curate's egg of a book: very good and very bad in about equal parts. Streeck's summary of recent economic thought is tight and informative. His conclusions from the diversity of opinion say much more, however, about the profound ignorance and arrogance of economists than the vulnerability of the world economy, however real that vulnerability may be. Similarly, his political observations are often acute and prescient. But the sociological implications he draws, especially his prescriptions for individual action, are trite, verging on the puerile.

I think therefore that just about half this book should have been written. I am reminded of John Wanamaker's famous quip: "I know that half my advertising budget is wasted; I just don't know which half." Fortunately, in the case of How Will Capitalism End?, it's fairly obvious which half. Economists and pollsters might want to lay off the predictive pontification and concentrate on thinking about why they don't agree with each other. It might improve their credibility enormously. And the rest of us could get back to the apocalyptic Book of Revelation.

[withdrawn · Rating 4 out of 5]

Read at your own risk.

"Democratic capitalism was fully established only after the Second World War and then only in the 'Western' parts of the world, North America and Western Europe. There it functioned extraordinarily well for the next two decades so well, in fact, that this period of uninterrupted economic growth still dominates our ideas and expectations of what modern capitalism is, or could and should be. This is in spite of the fact that, in the light of the turbulence that followed, the quarter century immediately after the war should be recognizable as truly exceptional. Indeed, I suggest that it is not the 'trente glorieuses' but the series of crises which followed that represents the normal condition of democratic capitalism a condition ruled by an endemic conflict between capitalist markets and democratic politics..."
p 72
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When I read my GR friend David M's review of Wolfgang Streeck's latest book, 'How Will Capitalism End?', I decided that I had to read it for two reasons: first, while I already agreed with Streeck that, "What comes after capitalism in its final crisis, now underway, is, l suggest, not socialism or some other defined social order, but a lasting interregnum no new world system equilibrium a la Wallerstein, but a prolonged period of social entropy or disorder (and precisely for this reason a period of uncertainy and indeterminacy)", I did not have a solid basis for that belief, just a vague dread about the world my children are inheriting. Secondly, I was not certain that our neo-liberal capitalist world is actually on the verge of collapse. Indeed, on that count, I am still not certain. It may just be wishful thinking.

There is much that I like about this book. I am especially impressed with Streeck's argument around the re-imbedding of "Economics" as a subject of study into the study of society as a whole. (À la Karl Polanyi) That we ever allowed ourselves to be fooled into believing that there could exist such a thing as an "economist" who would be able to lord it over all other aspects of society has long astounded me. "Sociologists of the World Unite!" - but don't try to predict beyond tomorrow. Next week is Trump's world.

The book is actually a set of freestanding essays based upon presentations Streeck has given. As such, the book does not necessarily present a single theme. Many of the essays were of greater interest to me than I would have expected from the titles, in particular, those on The European Union.

At this point, I would just like to comment on the way in which sociologists, and "economists" for that matter, often tend to see the world only from their own perspective. Americans analyze America and Europeans analyze Europe. Yes, Europe is out there somewhere for Americans and America is the 'éminence grise' for Europeans, but really, they do not factor each other in very well. Thus, the American led global economy gets little mention here while Germany and the European Union hold centre stage. The collapse of capitalism, when and if it occurs, will entail all of us, not just Angela Merkel's Europe. That being said, I did get a great deal out of the essays on the E.U.

Streeck explains the coming "end of capitalism', and, indeed, the constant crises including our current recession which started in 2008, as a result of an inherent contradiction (conflict) within our "democratic capitalist" system. The glory days of this system occurred following World War II during the so-called 'trente glorieuses', the thirty years of comparative growth of both the economies in western democracies as well as the general wellbeing of the populace of these countries. It was the age of growth of the welfare state and the expectation of a Chevrolet, a Volvo or a VW in every driveway. The concepts of rights and equality also grew and ideas of class consciousness declined. Streeck explains the origins of this time in terms of an agreement between labour and capital.

"The structure of the post-war settlement between labour and capital was fundamentally the same across the otherwise widely different countries where democratic capitalism had come to be instituted. It included an expanding welfare state, the right of workers to free collective bargaining and a political guarantee of full employment, underwritten by governments making extensive use of the Keynesian economic toolkit. When growth began to falter in the late 1960s, however, this combination became difficult to maintain. While free collective bargaining enabled workers through their unions to act on what had become firmly ingrained expectations of regular yearly wage increases, governments' commitment to full employment, together with a growing welfare state, protected unions from potential employment losses caused by wage settlements in excess of productivity growth. Government policy thus leveraged the bargaining power of trade unions beyond what a free labour market would have sustained. In the late 1960s this found expression in a worldwide wave of labour militancy, fuelled by a strong sense of political entitlement to a rising standard of living and unchecked by fear of unemployment."

Thus capitalism found itself in a a position where it could no longer continue to grow, as it has to do to stay alive, and to maintain labour peace. Government turned first to large-scale, long-term borrowing and currency manipulation to try to keep the peace, trying to meet the expectations of the electorate while not killing off capitalism, the proverbial goose. That eventually led to runaway inflation and slow economic growth. This in turn led to higher unemployment, the very thing democratically elected governments had promised to prevent. Crisis upon crisis.

Enter the theories of economist Friedrich von Hayek. Put simply, Hayek's theory proposes that capitalism only functions when the role of the government is minimized. Government should stay out of the economy except insofar as it is necessary to protect and facilitate capital growth. Once that state of affairs is reached, everyone will benefit. (Trickle down) These ideas began to percolate amongst economists, with the help of well-funded think tanks, and soon became the theory 'du jour' amongst right wing politicians.

Hence, Ronald Reagan and Maggie Thatcher introduced their policies of 'laissez faire' economics: busting unions, cutting social programs, lowering taxes on the rich, and deregulation. Today we call this neoliberalism: fewer labour rights, struggling, ineffective social programs, huge wealth and income gaps, and out of control financial institutions which threaten us with ever more devastating economic crises while democratically elected governments struggle with growing debt or, as in some cases, a loss of control of their own policies as big money calls the tune -see Greece or even Sweden which has traded its famed social democracy for 'fiscal responsibility'.
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(Sorry. I got a bit carried away there.)

In any event, Streeck does a fairly good job of explaining the above and much more. I had a great many "Aha!" moments while reading this.

In reply to my question as to why capitalism will fail, Streeck suggests simply that it needs opposition to continue. Having largely defeated the opposition, labour in Marxist terms, there is no longer any organized opposition.

Likewise with the question as to why there will be no "Socialist Revolution" to save us all. Nobody is standing in the wings ready to spring. There is no Lenin in Switzerland. It will be each and everyone of us on our own.

In response to this thesis, I would say, "Yet, but...." I do believe there is much more than that. There is the fact that environmental factors are already pushing many parts of the world to crisis. Corollary to that will be huge movements of people to other parts of the world (refugees in Europe? Wait until South Asia gets there.). Then there is the coming collapse of globalization. (Streeck touches on this but basically as a EU issue.) And I would suggest that many "democracies" are already imperilled as right wing (populist?) politicians take the stage. (Opportunists of the Mussolini type may be self generating in a legislature near you. I don't know.). And let us not ignore our depoliticized, consumer driven citizens who have no idea what is happening to their world. There are a great many possibilities on the horizon. As Streeck makes clear, neither he nor anyone else can project the final outcome nor when it will appear. This is the pessimists view of the future. I'll keep reading to see if there is a more optimistic, realistic option.

I have one major complaint with Streeck's arguments. Although he gives somewhat of an historical context, he leaves out any real discussion of globalization and its origins. I believe that this topic is necessary to any discussion of the future of our capitalist democracies.

"The Making of Global Capitalism" by Leo Panitch and Sam Gindin provides a good history of the creation of our globalized economic dominated societies. Briefly, during World War II, the American government realized two things. One, after the war the would be the most powerful nation left standing, economically and militarily. Two, the people of Europe, tired of wars and economic scarcity, were likely to turn to communist style socialism. The question was, "How do we prevent the loss of Europe to the USSR and spread American style democracy and capitalism?"

Their answer to this question was to share the wealth. This is not portrayed as some evil plot. What is interesting though is that this policy was originally driven, not by business, but by government. The government could attract no capitalists in America to invest in the European economy. The Marshall Plan to rebuild Western Europe and bring democracy and Keynesian style capitalism to the people, on the American New Deal model, was funded by the US government. This led to the trente glorieuses and a growth of American power and prestige (...and the eventual collapse of the Soviet Union, I would guess.)

Our current globalized world, which continues to eat away at our 'democratic' institutions and our individual wellbeing needs more discussion than Streeck gives it here.

That's enough. The book is so much more than this. A good education for us all. Now back to Polanyi and Keynes.

[Trevor · Rating 5 out of 5]

You could, if the mood took you, get away with just reading the introduction to this one. Not that the rest of the book would waste your time, but he covers many of the key ideas of the book in the introduction and it is a powerful read. People have been predicting the end of capitalism for about as long as there has been capitalism. To date, these predictions have proven shorter lived than capitalism itself. As the author says, though, just because predictions have previously been wrong, in no way means that they will always be so. Most of the previous predictions have not only pointed to the internal contradictions at the heart of capitalism – Marx and the contradiction between the social nature of production and the private nature of accumulation being the standout one – but have also seen this collapse and fall as being about to bring into existence something better to replace it – socialism, for example. This author predicts the end of capitalism, but does not suggest he knows what is about to replace it. Or rather, he does in a way – he thinks capitalism will be replaced by an extended interregnum. As Gramsci said, an interregnum is a period of apparent transition when the normal rules of society have been suspended. A period when the old world is dying and the new world is struggling to be born. A time of monsters. Except, where Gramsci saw this period as hopefully brief – the author here has no reason for such hope. He cannot see what force or group will be able to bring a new world into existence. Perhaps the interregnum will never end.

The introduction begins by providing a summary of essays in another book, Does Capitalism Have a Future? In this leading theorists from different perspectives essentially answer no for quite different reasons. After explaining their reasoning, he provides his own answer – also no. He says the difference between his answer and theirs is that while they provide a single explanation of the force that is going to bring about capitalism’s demise, he believes the situation for capitalism is much more complicated than this. He says that the fact so many theorists can reach the same conclusions, but from very different starting points actually points to the problem with sociology itself. That, rather than sociology being a science in the traditional sense, it is struggling to find its own foundations as a consistent source of criticism. His concern is that capitalism is facing multiple, overlapping and unresolvable contradictions, some of which have been with it from the start, and that it is not in the least bit clear where the white knight is going to come in this time to save it.

The problem is the ‘end of history’ idea that became popular with the fall of the Soviet Union and the end of any viable opposition from the left. As Polanyi made clear in his The Great Transformation – previously, one of the main things that saved capitalism has been other forces able to keep its worst excesses in check. These have either been democratic institutions, workers’ movements, citizen activists or even rival nations. But the global ascendancy of capitalism and its victory over the welfare state has left capitalism with no viable opposition. This means that it has been able to indulge itself in its own excesses. The growth of inequality (I read today that the wealth of the world’s richest people has more than doubled in the past decade – while that of the rest of us has remained either the same or gone backwards. This book suggests that the difference in wealth between the richest and poorest is greater now than at any time since slave societies) itself is making the future of capitalism unviable. We constantly bail capitalists out, expecting that they will invest the money we provide them to increase production and therefore employ more people. But instead they buy back stocks or find other ways to increase their wealth. There is little point in producing more stuff if no one has the money to buy what you produce. And so, the rich get richer. Capitalism is caught in a bind it can’t seem to find a way out of. It is eating its future by the over-exploitation of resources, it is running out of markets to sell its products, it is undermining the democratic institutions that might hold it accountable, but that also protect it from citizens who are increasingly feeling they have been lied to. And so we witness the swing to ‘popularism’ on both the right and the left. It is hardly any wonder that the US has just elected the equivalent of a wrestling actor as president. All that appears to be left of politics is a kind of grim and meaningless spectacle. Where the man vying for the office of the most powerful person on the planet spends 40 minutes dancing or pretending to give his microphone a blow-job, and still gets elected. A friend of mine doesn’t watch the news. When I told her these things she looked at me as if I was making them up. I can’t say they encouraged her to change her ways and pay more attention to the news.

But it is not moral decay that is the cause of the assumed end of capitalism – this is just a symptom. The problem is that there is no alternative – in Maggie Thatcher’s over-used phrase. Rather than there being no alternative providing strength to capitalism, it is achieving the opposite. Capitalism has been trapped in its own success. It is becoming increasingly clear that the multiple contradictions it currently faces will be virtually impossible to resolve – but while this will tear capitalism apart from inside, because there is no alternative, there is nothing waiting in the wings to replace it, either.

One of the bits of this book I particularly liked was his discussion of how capitalism had produced so much stuff in its Fordist era that it had more or less met all of our needs. But this was a problem for capitalism, because if you don’t need anything, you won’t buy anything – and if you don’t buy anything, capitalism fails. This was something Galbraith also discussed in his book The Affluent Society. That capitalism now needs to create wants, rather than meet needs. We have gone from Henry Ford saying, you can have a car of any colour you like, as long as it is black, to, the author says, a point where product differentiation is such that no two cars coming off the production line at Volkswagen is the same, we are able to personalise them to such an extent. This idea that we become the products we buy has always been with capitalism, but it is much more apparent today. And this is not only true of tangible items, but more so with the intangibles of the virtual world. And this has become the problem for socially provided products from welfare – they are still stuck in the Fordist paradigm. They are the mass produced, one size fits all variety of goods and services. Products that, at best meet our needs, rather than our wants – which have been determined by this notion of individualisation and creation of our identities. Again, as Galbraith said, private opulence amongst public squalor. Or as Baudrillard said in his reply to Galbraith, we do not live in an affluent society, but a consumer society – the difference being that consumers always are made to feel lacking – and so the very opposite of affluent.

This is a relatively simple read, given its subject matter. It is also well worth a read too. Capitalism has survived for so long because it constantly shape-shifts. Something even Marx had to admit. The predictions of the end of capitalism have come from so many different sources – Keynes, Weber, Schumpeter to name a few. But the resourcefulness of capitalism has always been underestimated. That said, the financial, ecological, productive and profit crises facing capitalism at the moment don’t appear to have an obvious solution. Just as what might come next is also anything but clear. And this is the power of this book – that it doesn’t propose a simple solution to the problems we face, but just because there isn’t a simple solution does not in the least mean that the problems don’t exist, nor that they are not system ending. This book might not leave you with much optimism – but optimism is hardly something that is called for at the present moment.

[David M · Rating 5 out of 5]

Read. this. book.

Though I do believe it's now too late to vote in the prestigious goodreads' choice awards, this would get my nod for best nonfiction published in 2016.

In a recent interview with the Jacobin, Streeck said that the most pressing task for the left right now is to sober up. Well, this book (particularly the introduction and title essay) certainly has that effect - profoundly sobering, not to say devastating. Before 11-8, I would have found his analysis interesting but somewhat abstract and possibly exaggerated - one of many interesting theories to consider. Now that things are playing out the way they are, it's impossible to deny the urgency of his vision.

Given the universal humiliation of the media class, the total discrediting of conventional wisdom, it's necessary to delve very deep to get any kind of grip on the present. Streeck offers that necessary depth.

*
After a youth flirting with anarchism and other various radical identities, I may now be having a socialist awakening. In the present context to be a socialist effectively means to be a conservative - be in favor of restoring democracy to public life, preserving what's left of our liberal institutions, and, yes, maybe even saving capitalism from itself.

However, it may already be too late for that.

For the decline of capitalism to continue, that is to say, no revolutionary alternative is required, and certainly no masterplan of a better society displacing capitalism. Contemporary capitalism is vanishing on its own, collapsing from internal contradictions, and not least as a result of having vanquished its enemies - who, as noted, have often rescued capitalism from itself by forcing it to assume a new form. What comes after capitalism in its final crisis, now underway, is, I suggest, not socialism or some other defined social order, but a lasting interregnum - no new world system equilibrium a la Wallerstein, but a prolonged period of social entropy or disorder (and precisely for this reason a period of uncertainy and indeterminacy). It is an interesting problem for sociological theory whether and how a society can turn for a significant length of time into less than a society, a post-social society as it were, or a society lite, until it may or may not recover and again to become a society in the full meaning of the term.

Insofar as neoliberalism had a philosophy other than sheer profit, it was something along the lines of disintegrating society in order to emancipate the individual (note to self: read Hayek). It's gone along way towards the first of these goals, but by now it should be clear that the second in no way follows. Just as the speaker can't speak without language, so the individual can't exist except against a background of shared social bonds. When these bonds are destroyed the individual naturally reverts to a helpless, terrified infant. We are seeing this dynamic play out now in the way our culture elevates the most vacuous and pathologically selfish individuals as models to be envied and emulated (yes, the president-elect is the most egregious example of this, but to be fair I think you can see it on the other side as well; Hillary often ran on a platform of feminism as celebrity self-entitlement).

[Christy Hammer]

"A general logic of crisis" is how capitalism will end. (Shades of Habermas??)

For political economists and all those that strive to think like one, check out this book review if you didn't catch it in LRB. Shared by a political economist friend in Turkey, trained at London School of Economics, and waiting to be pulled from his classroom most any day in Istanbul that is growing more fascist and reactionary every day.

http://www.lrb.co.uk/v39/n01/adam-too...

[howl of minerva · Rating 4 out of 5]

The first essay is 5-star and a must-read. See David M's review and others.

After that it gets a bit repetitive. His euroscepticism raises very valid concerns but he kind of misses the point in that the purpose of the EU is to prevent further intra-European wars, particularly Franco-German.

[Anna · Rating 4 out of 5]

I came across an excellent quote from Wolfgang Streeck in another capitalism-is-doomed book that I read not long ago, damned if I can remember which one though. Thus his name piqued my interest and I was compelled to borrow ‘How Will Capitalism End?’ when I saw it in the library. The book consists of eleven essays, none as long as the introduction, on three broad topics: capitalism’s incompatibility with democracy, the history of capitalism’s self-destructiveness, and how the discipline of sociology can study the two. I am generally suspicious of non-fiction collections with fifty page introductions, but concede that sometimes this is necessary to draw together a series of short pieces written at various times for various purposes. All chapters have an academic tone, while mostly avoiding specialised technical language. Where it was used, the meaning was generally clear from context. As the chapters were not originally written with the intention of being collected into a book, there is inevitably some overlap here and there. Streeck politely apologises for this in a note at the beginning. However he does not apologise for his fondness for footnotes, which verges upon absurd at times. Minor matters of presentation aside, the actual content is excellent. There is a great deal of interesting and well-explained material to be found in quite a short book.

From the start, it is refreshing to read a well-argued thesis that capitalism and democracy’s cohabitation is inherently temporary and unstable. This view was popular throughout the 19th century and the first half of the 20th. Fukuyama’s triumphalist The End of History and the Last Man looks in retrospect even weaker than it did when I read it in 2012. The thesis is clearly one that was believed because people wanted it to be true, rather than because there was overwhelming evidence in support. Streeck returns repeatedly to the theme of how the thirty years between WWII and the rise of neoliberalism were exceptional and there is no reason to assume that they can be repeated. As a sociologist, Streeck grounds his points in historical, economic, and social context. He is very good at picking out and summarising the crucial features of complex historic changes. Globalisation, for instance, he explains as follows: ‘Now states were located in markets, rather than markets in states.’ How beautifully succinct! That’s precisely the nature of globalisation: an economic order in which national governments are subordinate to international markets, especially financial markets.

His condemnation of neoliberalism is extremely thorough and satisfying. A summary:

Capitalist society is disintegrating, but not under the impact of an organised opposition fighting in the name of a better social order. Rather it disintegrates from within, from the success of capitalism and the internal contradictions intensified by that success, and from capitalism having overrun its opponents and in the process become more capitalist than is good for it. Low growth, grotesque inequality, and mountains of debt; the neutralisation of post-war capitalism’s progress engine, democracy, and its replacements with oligarchic neo-feudalism; the clearing away by ‘globalisation’ of social barriers against the commodification of labour, land, and money; and systemic disorders such as infectious corruption in the competitive struggle for ever bigger rewards for individual success, with the attendant culture of demoralisation, and rapidly spreading international anarchy – all these together have profoundly destabilised the post-war capitalist way of social life, without a hint as to how stability might ever be restored.

On inequality specifically:

Oligarchic elites, Winters shows, while they may disagree on just about everything else, are firmly united in their desire to defend their wealth. For this they can afford to employ a huge and highly sophisticated ‘wealth defence industry’ of lawyers, PR specialists, lobbyists, active and retired politicians, and think tanks and ideologies of all kinds, including entire economics departments.

On the lack of alternatives to capitalism:

Having no opposition may actually be more of a liability for capitalism than an asset. Social systems thrive on internal heterogeneity, on a pluralism of organising principles protecting them from dedicating themselves entirely to a single purpose, crowding out other goals that must also be attended to if the system is to be sustainable. Capitalism as we know it has benefited greatly from the rise of counter-movements against the rule of profit and the market. Socialism and trade unionism, by putting a brake on commodification, prevented capitalism from destroying its non-capitalist foundations - trust, good faith, altruism, solidarity within families and communities, and the like.

Streeck argues that without such opposition to moderate its profit-seeking, over-commodification of land, labour, and money inevitably creates crises in capitalism. Capitalism systematically overruns public institutions that were constituted to control these excesses: ‘capitalist action may break through its social containment unless that containment is continuously reinforced and vigilantly kept current.’ Within the three broad headings, many other books explore further details: over-commodification of land and nature results in climate change, deteriorating air quality, species extinction, polluted oceans and soils, etc. Over-commodification of labour results in a poor, insecurely employed, exhausted workforce reliant upon credit to get by. Not only does this hugely undermine well-being, it damages productivity, creates serious social tensions, and encourages credit bubbles. (The introduction proposes a neat list of behaviours for survival under neoliberal capitalism: coping, hoping, doping, and shopping, which certainly strike a chord.) Over-commodification of money occurs when financial markets are freed of regulation and thus able to fraudulently create obscure investment products with no actual value, resulting in massive financial crises like that of 2007/8.

Of the three, money gets the most coverage in this volume, which includes a fair amount of economic and political history focused on Europe. Indeed, chapters 4 to 7 consist of detailed critique of the EU as a neoliberal, anti-democratic institution. A lot of the material echoes Varoufakis in And the Weak Suffer What They Must? Europe's Crisis and America's Economic Future. I feel ambivalent reading such critiques these days, being a British person stuck in the chaotic and hellish political limbo of Brexit. As a Remainer, it seems axiomatic that I should fully support the EU, because Brexit ‘debate’ is so polarised. Yet to me it is clearly the lesser of two evils. As Trump’s current visit to the UK makes clear, if we leave the EU the NHS will be sold off to US health companies, product standards will fall, environmental protections will be eroded, and employment protection will be weakened. After nearly a decade of austerity and Tory deregulation, public services in the UK are already in a bad state. Brexit would make things a great deal worse. The EU may be neoliberal, as Streeck and Varoufakis make abundantly clear, but historically the UK has pushed it to the right and resisted its more progressive policies. The EU may also be undemocratic; Leavers have a point there. However they are looking in the wrong place for the UK’s lost so-called sovereignty. That was stolen by international financial markets, who will descend like vultures to asset-strip the UK if we leave the EU. The European Central Bank is certainly a neoliberal and undemocratic instrument of globalised finance; so is the Bank of England. If the UK wants the EU to tackle its systemic problems and structural contradictions, we can pursue this better from within rather than flouncing off then yelling feebly from our rainy privatised island. This is quite apart from the racist anti-immigration discourse, immense practical difficulties and unnecessary costs associated with the actual exit, not to mention the disastrous effects it could have on peace in Northern Ireland.

Having recently read Zuboff’s The Age of Surveillance Capitalism: The Fight for a Human Future at the New Frontier of Power, I was curious to see whether Streeck identified data commodification as novel manifestation of capitalism. Digital marketing is mentioned as an engine of consumerism, but the main overlap is this general point about ‘border-crossing’ that Zuboff also emphasises: ‘Capitalist expansion, or development, consists of the establishment of market relations where hitherto there were none. Social institutions that demarcate areas of trade against areas of non-trade, from national borders to laws prohibiting, say, sale of organs, children, or cocaine, will find themselves under pressure from profit-pursuing actors seeking to extend economic exchange cross demarcation lines. […] Studying contemporary capitalism requires that processes of this sort are recognised as fundamental rather than contingent, and as principal driving forces of institutional change and historical development.’ In the realm of surveillance capitalism, behavioural data and predictions became tradeable because tech companies were not prevented from extending commodification in this direction. Streeck’s analysis also reminded me of a question Zuboff’s book raised and lacks a clear answer: to what extent is surveillance capitalism parasitic upon industrial capitalism? Streeck by no means treats capitalism as a single thing, indeed he is at pains to point out historical, cultural, and social variations. However he does not broach the question of whether information technology has enabled a new manifestation of capitalism, its surveillance form, and what that might mean for the future. Surveillance capitalism clearly needs industrial capitalism to produce and maintain its physical infrastructure; it cannot exist in isolation. Moreover, it has strong interdependencies with international financial and consumer goods markets. Yet it also undermines the operation of democracy and exacerbates inequality, over-commodification, globalisation, and demoralisation, indeed accelerating these trends. But will it collapse along with capitalism, or shape a post-capitalist world? I need to read and think more about this before I can come to any firm conclusions.

For those inclined to read a Verso book titled ‘How Will Capitalism End?’, the conclusion that Streeck reaches is likely to seem depressing. Rather than giving way to a more democratic and/or socialist order, Streeck argues that neoliberal capitalism has no obvious successor other than complete chaos. In response to Wolfgang Merkel arguing for reform of neoliberal capitalism, he comments very reasonably: ‘one feels obliged to ask where those reforms are to come from, reversing a now decades-long mainstream of economic and political-institutional development that went in the exact opposite direction. […] Can a democratic renewal – a re-establishment of the primacy of democratic politics over the inherent dynamics of capitalist development – really be expected from a public no longer used to taking politics seriously?’ The essays in this collection were written between 2011 and 2015. In the past four years, evidence of a democratic renewal has been conspicuously absent. Despite the grim implications of this, there is something invigorating in Streeck’s writing. The idea that capitalism would collapse from its own contradictions is a powerful and important one. Even if the aftermath of capitalism is a chaotic and violent breakdown, it’s worth thinking now about what could be built from the ruins. The most important contribution that this book makes is summarised by a statement from the first chapter:

I suggest that we learn to think about capitalism coming to an end without assuming responsibility for answering the question of what one proposes to put in its place. It is a Marxist – or better: modernist – prejudice that capitalism as a historical epoch will end only when a new, better society is in sight, and a revolutionary subject ready to implement it for the good of mankind. This presupposes a degree of control over our common fate of which we cannot even dream after the destruction of collective agency, and indeed the hope for it, in the neoliberal-globalist revolution.

[Dax · Rating 3 out of 5]

An interesting read that lacks a strong conclusion or takeaway. Yes, Streeck does a great job of showing our path from social democracy to consolidation state via neoliberalism. The chapter that focuses on the incompatibility of capitalism and democracy is the strongest aspect of the book and worth the price of admission alone.

The reason for three stars is his unwillingness to propose a potential solution for the income gap and the mounting obligations of the debt states. He briefly mentions getting rid of globalization and re-embedding democracy, but then immediately accepts the futility of such a notion. I won’t even bring up his “forecast” of a turbulent future with an under-governmented society (if I remember correctly that was his exact term).

His observations are well presented but are certainly not ground breaking. I give him big bonus points, however, for recognizing the failure of the welfare state - a significant admission from an economist who genuinely fears Hayekinism and favors redistribution.

A good work, but there was some meat left on the bone.

[Maru Kun]

Interesting review by Adam Tooze on this work in the London Review of Books: A General Logic of Crisis.

"...Streeck believes...Capitalism will end not because it faces serious opposition but because over the course of the coming decades and centuries it can be relied on to consume and destroy its own foundations. We should expect ever intensifying stagnation, inequality, the plundering of the public domain, corruption and the escalating risk of major war, all of this accompanied by a pervasive erosion of social order, generalised social entropy. Indeed, according to Streeck we have at least since the 1970s been living in what he refers to as a ‘post-social society … a society lite’. We cope individually with conditions of increasing uncertainty, while at the macro level both society and economy become increasingly ungovernable. ‘Life in a society of this kind,’ he writes, ‘demands constant improvisation, forcing individuals to substitute strategy for structure, and offers rich opportunities to oligarchs and warlords while imposing uncertainty and insecurity on all others, in some ways like the long interregnum that began in the fifth century CE and is now called the Dark Age.’..."

Sounds about right to me.

[Athan Tolis · Rating 4 out of 5]

Comfortably the most provocative thing about this book is its title.

Away from that, this collection of twelve essays on the decline of the market economy is very sober and sedate. It’s certainly no call to arms! Neither its content nor its style relate in any way to the sundry cod-revolutionaries who endorse it on the cover; Streeck, a serious sociologist, is nothing like them!

His answer to the question he asks on the cover of the book can be summarized in a rather apologetic “we don’t know for sure that capitalism will end, we just know it’s in trouble.”

He does not foresee a new world order and he does not propose an alternative system. He merely predicts that the current struggle between what he calls “democracy” and “market forces” will remain unresolved, leading to permanent instability and unpredictability, with all that entails.

The basic assumption in the background of the book, never fully articulated (the best effort to do so is in Chapter 8), is that the capitalism system as we know it (the kind that 1. helps us best to decide where to allocate our marginal resources and the kind where 2. democracy and market forces have worked in relative harmony) is a special type of system that can only thrive if it is hosted and supported by strong institutions, including a government that sets and enforces basic rules and regulations regarding what it is we’re allowed to own, whether we’re allowed to transfer ownership, how much market power businesses are allowed to exercise, what happens if we fail to stick to our side of a bargain etc. etc. This not being a naturally-occurring system, its institutions need continuous support from society, and the support has (perversely) often come via the resolution of internal or even external conflict. Conflict that has certainly been absent since the “end of history” in 1989, for example.

In the author’s own words, capitalism “was always a fragile and improbable order and for its survival depended on ongoing repair work. Today, too many frailties have become simultaneously acute while too many remedies have been exhausted or destroyed. The end of capitalism can then be imagined as a death from a thousand cuts.” (p. 13) He goes on to state the main theme of his book as follows: “For the decline of capitalism to continue, no revolutionary alternative is required, and certainly no masterplan of a better society displacing capitalism.” (p. 14) Between now and the “end of capitalism” Streeck basically predicts a Dantean purgatory: “A society in interregnum would be a de-institutionalized or under-institutionalized society.” (p.14)

The most dire prediction you will find here is that “the social world of the post-capital interregnum, in the wake of the neoliberal capitalism having cleared away states, governments, borders, trade unions and other moderating forces, can at any time be hit by disaster.” (p. 14)

My favorite essay is not the one that gives the book its title. Comfortably the most lucid piece here is chapter 9, “How to Study Contemporary Capitalism.” It is in this well-considered chapter that the author best summarizes his (perforce, in a collection of essays, oft-repeated) narrative that takes us from the apogee of the system around 1970 to its near-death experience in 2008:

“After the end of post-war growth, governments in the ‘free world’ avoided conflicts with strong trade unions over wage increases and unemployment by allowing for high rates of inflation. Inflation, much like credit, served to pull forward in time as yet non-existing resources, enabling employers and workers to realize in nominal money terms claims whose sum total was in excess of what was in fact available for distribution. While workers believed they were achieving what they perceived to be their moral-economic right to a steadily rising living standard combined with secure employment in their present jobs, employers were able to reap profits in line with expectations of a proper return as established in the decades of post-war reconstruction. As inflation continued, however, it devalued accumulated savings and increasingly distorted price relations. Its conquest in the early 1980s, in the course of the ‘Volcker revolution, did not bring stability, however. Instead, it ushered in a period of rising government debt as electoral politics substituted for collective bargaining as the political-economic mechanism of the time for mobilizing surplus resources to pacify otherwise disruptive distributional conflict. When this, too, became unsustainable in the 1990s, consolidation of public finances could be undertaken only by giving households access to deregulated private credit, allowing them to compensate for stagnant incomes and rising inequality by borrowing on their own account.” (pp. 214 – 215)

The essays in the book take turns in looking at the events of this period through a number of the favorite “lenses” of socialist theory.

Chapter 3, for example, expounds the well-worn theory that for the longest time Soviet communism and American capitalism were busy delivering pretty much identical outcomes to their citizens. It was allegedly only at the point where every Russian household and every American household alike were equipped with (for example) a washing machine that the outcomes bifurcated. Capitalism at that point stopped fulfilling “needs” and moved on to “wants” and became a mechanism to create new consumerist “wants” for its citizens who would not have felt the urge to buy these goods and services if they had not been prodded to do so.

With only 2% of the US workforce working in agriculture today managing to not only feed the entire US population, but also rendering the US the largest food exporter on earth, I think the argument is stale. Pakistan has 70% of its population working in agriculture and my home country of Greece is at the geometric mean of the two at 12% and I’ll tell you people are applying for green cards from both (and both countries, unlike the US, are net importers of food too!) The fact that the US has 98% of its workforce to spare after it’s grown its food does not strike me as a failure. Neither do I think the work they do is inferior in interest to that performed by the guys who work at Monsanto or the sundry mercantile exchanges, to say nothing of the 0.6% of the US population that actually gets dirt under its fingernails. The argument extends even better in my view to manufacturing, Donald Trump’s (and presumably Wolfgang Streeck’s) objections notwithstanding.

Similarly, the book laments the fact that women have been forced to join the workforce (allegedly so the family unit can keep spending –the author refuses to acknowledge that they may get positive utility from working) and even hints that people today are acquiring education as a means to an end (spending) rather than because they want to. All a matter of opinion, of course, but mine differs rather vehemently form Wolfgang Streeck’s. I did a math degree at the age of 31-33 and God knows I had nowhere to go with it. I just loved doing it. I’m 100% sure I was not alone and 99% sure I’ll never use the stuff I learned and have already forgotten. It was consumption, alright, but my brain was doing the consuming and I had a ball.

There is a collection of chapters (four in total) that concern themselves with the situation in Europe. The European bureaucracy, chief among its institutions the ECB, is correctly identified as the ersatz European government and is accused of putting the interests of capital ahead of the interests of the citizens.

The author is exactly correct to say that the European institutions tend to identify more with the lender (typically a northern European bank or pension fund) than with the borrower (typically a Mediterranean government). He is equally correct to identify that democratic process was suspended when the elected governments of both Italy and Greece were supplanted by banking-friendly technocrats.

He fails, however, to observe that when push came to shove, the ECB used all its authoritarian independence not to enforce rules, but to pander to the sundry borrowers. It did so, moreover, in a manner no sovereign government could ever hope to emulate. For all of Wolfgang Streeck’s protestations, the institutions he decries (perhaps in self-preservation) have printed trillions of EUR, precisely to allow the struggle between “democracy” and “market forces” to remain unresolved. That’s what “kicking the can down the road” has been all about, and it’s the most august of institutions to whom this has been delegated.

The role of the objectionable institutions at the center of Europe has thus been dual:
1. First, a mechanism for sovereign EU governments to avoid political accountability to the individual electorates when passing tough measures, a way indeed to bypass the democratic process.
2. Second, a mechanism for sovereign EU governments to avoid political accountability to the individual electorates when letting off the hook those who cannot pay. Germany would never have bought Italian bonds. Along the same lines, the UK would never have sent money to Ireland, much as that was necessary to end the era of IRA terrorism. All that money has been channeled through the institutions of the EU.

The failures of the ECB have in my view not come from its mandate or from its attitude to state borrowers. The ECB has actually failed in a much more fundamental role, that of keeping its eye on the banking system: it let German and Dutch banks gorge on both US subprime and Mediterranean govvies, while allowing the Spanish and Italian banking system to take full advantage of the “exorbitant privilege” to create EUR.

In what has to be the most unsung string of financial crimes in history, we ended up with Spanish owners for companies as diverse as Hochtief, all of the UK’s civilian airports, the Argentinian phone company etc. etc. all while the Spanish banking system defaulted on hundreds of thousands of depositors whom it duped into buying its subordinate debt. Similarly, Michele Ferrero (purveyor of fine chocolates to the ambassador’s reception) died in Monte Carlo and the Agnellis have moved their partying to New York and their holding company well clear of Italy, all while the Italian banking system is dying under a mountain of loans that will never be repaid and derivatives deals that nobody ever questioned. That’s what Streeck ought to be complaining about in my view. Not about authority that was never really used, other than to help kick the can down the road.

But enough about that. A truly fantastic chapter (chapter 8) follows, which laments the displacement of the discourse that has taken place in our democratic societies:

You cannot but agree with Streeck that, rather than seek to address THE basic issue, which has to be redistribution, the “progressive” side in politics has abdicated its responsibility and prefers to talk about non-issues: “Culture wars, ‘family values,’ lifestyle choices, ‘political correctness,’ the age and sex of politicians, and the way they dress and look and speak deliver an unending supply of opportunities for pseudo-participation in pseudo-debates, never allowing for boredom to arise: whether the foreign minister should or should not have his male companion accompany him to a state visit to the Middle East; if there are enough women cabinet members, and in sufficiently powerful positions; how female ministers attend to their small children, too little or too much; whether the president of the Republic should use a motor cycle when visiting his lover; and how often the minister of economic affairs takes his daughter to Kindergarten in the morning.” (p. 189)

This, of course, mirrors the way the Democratic party in the US has refused since 1976 to engage in anything resembling redistribution, has refused to contain the market power of emerging monopolies from IBM through to Microsoft and onto Google and Uber, has allowed (alone with New Zealand among advanced countries) big pharma to advertise on TV, came down in favor of Angelo Mozilo and “sanctity of contract” rather than the evicted subprime borrower, all while of course espousing Romneycare, pretending to shut down Guantanamo, pretending that sticking “record fines” on people like Steve Cohen is comparable to how we treated Boesky and Milken three decades ago, trying and failing to sign the odd treaty on non-proliferation, paying lip service to global warming, making nice with Fidel Castro and more recently espousing separate toilets for transsexuals and shouting “Putin” whenever it feels it’s been cornered on the issues.

The less-developed theme in the book, though still present in quite a few of the essays is the idea that in the course of the past forty years capitalists have gathered enough power to work around the restrictions imposed by the state, but that this has actually served to threaten capitalism, because it has led to excesses that are provoking an angry reaction to the status quo.

In my view that’s a pity, because if there is a threat to Capitalism that’s precisely from where it comes:

Streeck has the pieces, but he fails to put them together, basically. The American more so than the Western European, is first and foremost a consumer, and he’s been getting killed:

1. The crisis of 2008 has thrown in the microwave oven the hitherto slow process from “perfect competition” to “oligopoly” in so many markets (example: two companies sell baby formula in the US, only one sells chewing gum, your cable TV typically comes from one source and the two biggest mattress companies have merged) that the supply curve on tons of products and services has wildly curved upwards, squeezing output downward and price upward, not only causing the sluggish growth the economy has been experiencing (including to the market for good jobs), but also keeping prices elevated in the face of crappy demand.

2. Just as this phenomenon is starting to consolidate (it had a one-time effect on the speed of growth and had a permanent one-time effect on inequality), another very sinister effect is taking hold: a large number of markets that used to clear at a single price for everybody is with the help of the Internet converting business model to perfect market segmentation. Think of how you don’t dare go back to a website and reprice plane tickets because the engine knows you just asked for that ticket, for example. Market segmentation allows for perfect price differentiation, which converts the whole of the consumer surplus into economic rent for the seller.

The shift of power from the consumer (the customer who used to be “king”) to the producer has not gone un-noticed. The American people did not vote in their first black president, a man promising to deliver “change,” because they were pining for a Harvard-educated member of the establishment who’d go on to sell his White House memoirs for 60 million dollars.

They firmly believed they were voting in a Hugo Chavez. An Andreas Papandreou. Somebody who might cost them, but would cost the emerging plutocracy even more.

The very same public that once simultaneously voted in Clinton, Blair and Schroeder (all of them "third-way" social liberals / nouveaux fiscal conservatives) to protect its newly-acquired middle-class savings from the idle recipients of welfare, the very same public that once hung by Greenspan’s every word, because he was the man to preserve those savings and protect them from the ravages of the market, has discovered that the powers-that-be have taken the mandate it gave to them to such an extreme that now it finds itself unable to hand over to its children the same status it was accorded by its parents.

And that is the biggest threat to capitalism.

The public is mad and second time round it’s taken no chances. The crazier the politician, the more insane he sounds, the likelier to bring down the temple, the better. We’ll deal with the consequences later!

Where does that leave us with Streeck’s opus? Well, it kept me good company, it taught me some stuff and it sure made me think. So I’ll round up its 3.5 stars to four, much as I disagree with most of what the author has to say. Also, it’s fantastic to hear from a socialist who is not shouting from the rooftops.

[Domhnall · Rating 5 out of 5]

The glass is half empty. This is not primarily because of either the contemporary triumph of capitalism or its imminent catastrophic demise but because there is no evident alternative in view. The introduction to this collection of essays is oppressively pessimistic and I was initially reluctant to continue reading. The remainder of the book is more constructive to the extent that it enters into a detailed and interesting analysis of the interactions between politics and economics and it does in the end have a constructive proposal to make. This is that economists, when they make unsupported claims about human social behaviour, should for the first time be properly challenged by sociologists, who are after all students of society in a way that economists are blatantly not.

There is nothing new in the idea that capitalism is inherently unstable. not just ... Marx and Engels but also Ricardo, Mill, Sombart, Keynes, Hilferding, Polanyi and Schumpeter, all ... expected one way or other to see the end of capitalism during their lifetime.[p12] What kind of crisis was expected to finish capitalism off differed with time and authors’ theoretical priors; structuralist theories of death by overproduction or underconsumption, or by a tendency of the rate of profit to fall (Marx), coexisted with predictions of saturation of needs and markets (Keynes), of rising resistance to further commodification of life and society (Polanyi), of exhaustion of new land and new labour available for colonization in a literal as well as figurative sense (Luxemburg), of technological stagnation (Kondratieff), financial-political organization of monopolistic corporations suspending liberal markets (Hilferding), bureaucratic suppression of entrepreneurialism aided by a worldwide trahison des clercs (Weber, Schumpeter, Hayek) etc., etc [p13]

Capitalism has in fact been characterised by a sequence of major challenges, some of which are identified in the introduction. In the late nineteenth century, the need to tame a revolutionary labour movement by a combination of repression and co-opting. In the early twentieth, the need to commandeer the resources of capitalism in two world wars. The failure after the first world war to produce a viable social order, so that capitalism had to give way in large parts of the industrial world to either Communism or Fascism, while in the core countries of what was to become ‘the West’ liberal capitalism was gradually succeeded, in the aftermath of the Great Depression, by Keynesian, state-administered capitalism... Out of this grew the democratic welfare-state capitalism of the three post-war decades, with hindsight the only period in which economic growth and social and political stability, achieved through democracy, coexisted under capitalism, at least in the OECD world... In the 1970s, however, what had with hindsight been called the ‘post-war settlement’ of social-democratic capitalism began to disintegrate, ... This was the period of both intensifying crisis and deep transformation when ‘late capitalism’... gave way to neoliberalism. [p14]

Streeck describes a broad pattern of interactions between the operation of political society and that of the market economy, in which the balance of power has frequently shifted over time. Political efforts to keep capitalism under some form of control have had varying success and it can be said that democracy has periodically rescued capitalism from its own self destructive tendencies. If the post war decades stand out as a golden era, in which democracy and capitalism appeared to be mutually supportive and beneficial, this has been displaced by a neoliberal era in which capitalism refuses to provide government with the funds through taxation that are required to sustain public services and to support democracy itself. Temporary solutions, based on public and private debt, are increasingly insufficient to compensate for the refusal of the rich and the middle classes to fund government properly, with the result that the public sector is in retreat throughout the developed world, while capitalism is drawing itself free from the social constraints of democracy. Methods are being found to maintain public consent or apathy in the face of this disaster, but there is an intrinsic limit to the capacity of capitalism to exploit human and natural resources without provoking its own destruction.

The apparent triumph of capitalism is reflected in statistics on inequality. To assess the extent to which growing inequality in America has produced an oligarchic power structure, Jeffrey Winters has calculated what he calls a Material Power Index for the contemporary United States... According to Winters, this corresponds roughly to the difference in material power between a senator and a slave at the height of the Roman Empire. [p44]

The risk arising within this apparent triumph is one of hubris. Beginning with oligarchic inequality – one could also speak of neo-feudalism – what matters here for the future of capitalism, or the lack of one, is not primarily that a tiny minority in today’s capitalist societies is becoming unimaginably rich. On this entire libraries have recently been produced, with little to no political effect. From the perspective of systemic stability what seems more important than inequality as such is that it may already have gone so far that the rich may rightly consider their fate and that of their families to have become independent from the fates of the societies from which they extract their wealth. As a result, they can afford no longer to care about them. This becomes a problem – one of ‘moral hazard’ – when differences in wealth become so extensive that they give rise to a fusion of economic and political power – that is, to oligarchy. [p43]

Plutonomic capitalists may no longer have to worry about national economic growth because their transnational fortunes grow without it; hence the exit of the super-rich from countries like Russia or Greece, who take their money – or that of their fellow citizens – and run, preferably to Switzerland, Britain or the United States. The possibility, as provided by a global capital market, of rescuing yourself and your family by exiting together with your possessions offers the strongest possible temptation for the rich to move into endgame mode – cash in, burn bridges, and leave nothing behind but scorched earth.[p85]

Max Weber drew a sharp line between capitalism and greed, pointing to what he believed were its origins in the religious tradition of Protestantism. According to Weber, greed had existed everywhere and at all times; not only was it not distinctive of capitalism, it was even apt to subvert it. Capitalism was based not on a desire to get rich, but on self-discipline, methodical effort, responsible stewardship, sober devotion to a calling and to a rational organization of life.[p87] ... After Enron and WorldCom, it was observed that fraud and corruption had reached all-time highs in the US economy. But what came to light after 2008 beat everything: rating agencies being paid by the producers of toxic securities to award them top grades; offshore shadow banking, money laundering and assistance in large-scale tax evasion as the normal business of the biggest banks with the best addresses; the sale to unsuspecting customers of securities constructed so that other customers could bet against them; the leading banks worldwide fraudulently fixing interest rates and the gold price, and so on. [88]... Nobody believes any more in a moral revival of capitalism. The Weberian attempt to prevent it from being confounded with greed has finally failed, as it has more than ever become synonymous with corruption. [p89]

Among other things, an interesting aspect of the book is a chapter analysing the ways in which the institutions of the European Union, and especially the single currency, function to the advantage of capitalism by transferring crucial economic decisions to bodies that are international and supposedly technical in their nature, hence standing apart from any serious or effective democratic accountability. Indeed, the author is scathing about every part of the EU, including the European Parliament. Sadly, while recognising the totally destructive impact of Brexit, it is easy to see why the EU is despised from the Left as well as from the Right in British politics.

Nevertheless, bearing in mind the deeply pessimistic nature of this entire book, it really is important to recover some critical faculties and notice that the cynicism is not based on solid facts, but rather on a particular way of representing them, which is open to question in many ways. It is one thing to appreciate the arguments, which are very lively and thought provoking, quite another thing to accept them in full. I need time to get it into perspective.

[Adam McPhee · Rating 2 out of 5]

Finally got around to reading this after hearing Paul Kennedy interview the author on CBC's Ideas.

Mixed feelings. It's incredibly soporific, but occasionally he busts out a passage like this:

How should we imagine a capitalism which is not dependent, for the sake of social cohesion, on a bloated credit system that promises to underwrite unlimited consumption standards of which everybody knows by now that they are not generalizable? A credit system, for that matter, whose promises seem increasingly irredeemable and that ever fewer creditors believe in. These questions have been addressed in various ways by conservatives, like Meinhard Miegel, or progressives such as Amartya Sen and Jean-Paul Fitoussi. But we know – or ought to – that a break with the self-destructive mass consumerism that currently has the world in its grip will only be possible if greater sacrifices can be extracted from those who have profited most from the recent transformations of the capitalist economy, as opposed to those who have seen their life chances decline during decades of liberalization and globalization.

A democratic departure from the life-threatening sedation provided by cheap-money capitalism would require new solutions to the problems which the latter has only worsened. Consumer credit as compensation for stagnating wages and a growing gap between top and bottom could become superfluous if all earned a decent wage. Better living and working conditions for the great majority would alleviate the need for yet more consumer toys to compensate for status anxiety, competitive pressure and increasing insecurity. This will not be possible without a revitalized trade-union movement that would help to end the ever more destructive exploitation of the human capacity to work and nurture families. At the same time, debt financing of public expenditure would have to be replaced by more effective taxation of the incomes and assets of liberalization’s winners. States should no longer have to carry out the tasks mandated by their citizens for society as a whole with borrowed money, which then has to be repaid with interest to the lenders, who in turn bequeath what has remained of their wealth to their children. Only if the trend towards deepening social division – the signature of capitalism in the late twentieth and early twenty-first centuries – were reversed would it be conceivable that modern society could free itself from the compulsion to assure domestic peace through the unchecked production of toxic assets to engineer synthetic growth.

This theme is anything but new. What should worry us is not the fact that it suddenly occurred – or recurred – but that its democratic solution appears so impossible today that we shy away even from naming it, so as not to seem stuck in the past. ‘Just as ancient peoples had above all need of a common faith to live by, we have need of justice’, Emile Durkheim wrote in his seminal work on the division of labour. Since the end of the post-war era, it is all water under the bridge, much of which has flowed down the Hudson River, past the southern tip of Manhattan from where the world is governed these days. Trade unions are disappearing, capital listens only to presidents of central banks, not to political parties; and the money of the rich is everywhere and nowhere, gone in an instant when strapped tax states reach for it. We can only wonder what form of opiate of the people the profiteers of late capitalism will come up with, once the credit doping of the globalization era stops working and a stable dictatorship of the ‘money people’ has yet to be established. Or may we hope they will have run out of ideas?

The bit about the four behaviours ("hoping, coping, shopping and doping") needed to survive unsustainable neoliberal capitalism was pretty good too.

The book ranges from a general breakdown of neoliberalism to some really insightful stuff about post-2008 capitalism. But the writing is so dry it's hard to read.

[Rhys · Rating 5 out of 5]

Streeck is an exceptionally clear writer, and he makes a cogent case throughout these essays on the ongoing transformation of capitalism ... but into what? Just chaos, it seems.

"For the decline of capitalism to continue, that is to say, no revolutionary alternative is required, and certainly no masterplan of a better society displacing capitalism. Contemporary capitalism is vanishing on its own, collapsing from internal contradictions, and not least as a result of having vanquished its enemies – who, as noted, have often rescued capitalism from itself by forcing it to assume a new form. What comes after capitalism in its final crisis, now under way, is, I suggest, not socialism or some other defined social order, but a lasting interregnum – no new world system equilibrium à la Wallerstein, but a prolonged period of social entropy or disorder (and precisely for this reason a period of uncertainty and indeterminacy)."

And then:

"I anchor this condition in a variety of interrelated developments, such as declining growth intensifying distributional conflict; the rising inequality that results from this; vanishing macroeconomic manageability, as manifested in among other things, steadily growing indebtedness, a pumped-up money supply, and the ever-present possibility of another economic breakdown; a suspension of post-war capitalism’s engine of social progress, democracy, and the associated rise of oligarchic rule; the dwindling capacity of governments and the systemic inability of governance to limit the commodification of labour, nature and money; the omnipresence of corruption of all sorts, in response to intensified competition in winner-take-all markets with unlimited opportunities for self-enrichment; the erosion of pubic infrastructures and collective benefits in the course of commodification and privatization; the failure after 1989 of capitalism’s host nation, the United States, to build and maintain a stable global order; etc. etc. These and other developments, I suggest, have resulted in widespread cynicism governing economic life, for a long time if not forever ruling out a recovery of normative legitimacy for capitalism as a just society offering equality opportunities for individual progress – a legitimacy that capitalism would need to draw on in critical moments – and founding social integration on collective resignation as the last remaining pillar of the capitalist social order, or disorder."

That last line is a beauty - social integration on collective resignation. It certainly describes the current attitude towards politics in my part of the world.

[Ferhat Culfaz · Rating 5 out of 5]

Excellent book. 6 out of 5. Sociologist by training yet excellent analysis of economics and of contemporary capitalism. Structured in a series of essays from past papers, Streeck highlights the dialectic between democracy and capitalism and how capitalism needs counter movements to function and improve. Otherwise it will eat itself. Streeck envisages a decline like the end of the Western Roman Empire to the Dark Ages. His analysis and insight is in the total history style of Braudel.

[Tuncay Özdemir · Rating 5 out of 5]

Bu kitabın direkt ana fikrini verecek bir video paylaşsam sizinle: José Saramago: Sahte Demokrasi Bu iki dakikalık videoyu izlediğinizde size komplo teorisi gibi geliyor değil mi? İşte bu kitap bu komplo teorisi düşüncesini değiştirebilecek bir kitap.

Aksayan bir sistem üzerine yazılar gerçekten de. Kapitalist dünyanın piyasa ahlakı ile demokrasinin sosyal adalet ahlakının karşıtlığı ve gerilimi, demokratik borç devletinin iki halkı Staatsvolk ve Marktvolkt üzerinden çok net ifade edilmiş. Aynı şekilde Avrupa’nın kuzeyinin üretime ve sağlam paraya dayanan ekonomileri ile güneyinin tüketime ve güçsüz paraya dayanan ekonomilerinin hem birbirine bağımlılığı hem de karşıtlığı da harika bir çerçeveye oturtulmuş. İçinde yaşadığımız şu curcunaya daha makro bir bakış sağlaması açısından tavsiye edebileceğim bir kitap. Bazı şeyler bireyin dünyasını çok aşıyor, yapısal sorunlar var hocam, yapısal.

[Helen · Rating 4 out of 5]

This book consists of long introductory chapter followed by several articles written by Professor Streeck, on the 2008 global financial and its causes & effect in general, and how academic sociologists should re-calibrate their area of research to include the study of capitalism since it is according to Mr. Streeck, at the heart of society today.

I thought the book was brilliant albeit not an easy read - since Mr. Streeck manages to pack so many ideas & references into sometimes lengthy sentences. The title of the volume is certainly attention-grabbing - the author believes that unless there are serious reforms, push-back by the people, finance-driven capitalism will ultimately devour itself, since there will be no opposition or counterbalance to stop it. Social or environmental degradation if it gets out of hand and is irreversible, will end capitalism.

As usual, I've picked up numerous quotes - they are certainly thought-provoking, and hopefully, informative as well.

From the Introduction:

"Capitalist society may be described ... as a 'progressive' society in the sense of Adam Smith and the enlightenment, a society that has coupled its 'progress' to the ...unlimited production and accumulation of productive capital, effected through a conversion, by means of the invisible hand of the market and the visible had of the state, of the private vice of material greed into a public benefit."

"For this [...acceptance of the highly unequal distribution of wealth and power generated by the capitalist economy and a belief in the legitimacy of capitalism as a social order] highly complicated and inevitably fragile institutional and ideological provisions are necessary. The same holds true for the conversion of insecure workers - kept insecure to make them obedient workers - into confident consumers happily discharging their consumerist social obligations even in the face of the fundamental uncertainty of labor markets and employment."

"Liberal capitalism in the nineteenth century was confronted by a revolutionary labor movement that needed to be politically tamed by a complex combination of repression and co-optation, including democratic power sharing and social reform."

"Out of [Keynesian, state-administered capitalism in the aftermath of the Great Depression] ... grew the democratic welfare-stat capitalism of the three post-war decades, ...the only period in which economic growth and social and political stability, achieved through democracy, coexisted under capitalism ... in the OECD world where capitalism came to be awarded the epithet, 'advanced.'"

"...technological fixes may appear any time for all sorts of problems, and in any case it is the working class and revolutionary socialism much more than capitalism, for which 'the end is nigh.'"

"...capitalism would only perish as a result of the destruction of all human civilization. One such scenario would be nuclear war, started by collective human irrationality, the other an ecological catastrophe resulting from 'escalating climate change.'"

"...capitalism is subject to 'a long term structural weakness,' namely 'the technological displacement of labor by machinery' [Collins]."

"The benefits...will go to 'a tiny capitalist class of robot owners' who will become immeasurably rich."

"...their product 'cannot be sold because too few persons have enough income to buy it. Extrapolating this underlying tendency,' Collins writes, 'Marx and Engels predicted the downfall of capitalism and its replacement with socialism'..."

"Some sort of socialism, so Collins concludes, will finally have to take capitalism's place."

"...traditional economic and sociological theories have today lost much of their predictive power."

"...declining growth intensifying distributional conflict ... rising inequality...vanishing macroeconomic manageability as manifested in.... steadily growing indebtedness, a pumped-up money supply ...the ...possibility of another economic breakdown ...the... rise of oligarchic rule; the dwindling capacity of governments ...to limit the commodification of labor, nature and money; the omnipresence of corruption...the erosion of ...infrastructures and collective benefits in the course of commodification and privatization; the failure after 1989 of capitalism's host nation, the United States, to build and maintain a stable global order.... ...resulted in widespread cynicism governing economic life...ruling out a recovery of normative legitimacy for capitalism ...offering equal opportunities for individual progress...."

"...after the end of inflation at the beginning of the 1980s the 'tax state' of modern capitalism began to change into a 'debt state.' ...it was helped by the growth of a ...increasingly global financial industry headquartered in the rapidly de-industrializing hegemonic country of global capitalism, the United States."

"The three apocalyptic horsemen of contemporary capitalism - stagnation, debt, inequality - are continuing to devastate and economic and political landscape."

"Where employment has ...been restored it tends to be at lower pay and inferior conditions, due to technological change ...and to e-unionization, with the attendant increase in the power of employers."

"The advance of neoliberalism coincided with steadily declining electoral turnout in all countries, rare and short-lived exceptions notwithstanding..."

"Party membership declined...party systems fragmented; and voting became volatile and often erratic. In a rising number of countries ...so-called 'populist' parties, mostly of the Right but lately also from the Left ... mobilize marginalized groups for protest against 'the system' and its 'elites.' Also declining is trade-union membership - a trend reflected in an almost complete disappearance of strikes..."

"As capital and capitalist markets began to outgrow national borders, with the help of international trade agreements and assisted by new transportation and communication technologies, the power of labor, inevitably locally based, weakened, and capital was able to press for a shift to a new growth model, one that works by redistributing from the bottom to the top."

"...the Left began to internalize the idea of globalization a a natural evolutionary process unstoppable by political means - while for capita globalization it offered a long-desired way out of the social-democratic prison or workhouse in which it had been kept during the 'trente glorieuse.' Now states were located in markets, rather than markets in states."

"...capital used its newly gained mobility to push for lower taxes, less regulation, and ... for rigidity being replaced with flexibility."

"...the financial industry ...escaped democratic control everywhere except, perhaps the United States. Then .. it became the most important source of economic growth, tax revenue and campaign contributions."

"National democracies in debt began to face a second constituency, the financial industry..."

"Today...democracy may be conceived as a struggle between two constituencies, the national state people and the international market people..."

"By providing its customers with liquidity, the financial industry establishes control over them, as is the very nature of credit."

"The power of money, wielded by central banks...takes the place of the power of votes, adding importantly to the decoupling of democracy from political economy that is the central requirement of the Hayekian model...of profit growth."

"Neoliberal ideology supports migration and open borders in the name of personal liberty and human rights, knowing that it provides employers in the receiving counties with an unlimited labor supply, thereby destabilizing protective labor regimes.'

"As post-war national labor regimes...are being subverted by international competition, labor markets in leading capitalist countries are changing to precarious employment, ...freelancing and standby work... An extreme case in point is Uber, a giant of the so-called 'sharing economy,'

"...five 'systemic disorders' ...have befallen contemporary capitalism... ...stagnation, oligarchic redistribution, the plundering of the public domain, corruption and global anarchy."

"...the rich ...become independent from the fates of the societies from which they extract their wealth. ...they can afford no longer to care about them. ...a problem - ...of 'moral hazard' - when differences in wealth become so extensive that they give rise to a fusion of economic and political power - that is, to oligarchy."

"American oligarchs, unlike their counterparts in other societies like Ukraine or Russia, are of a 'non-ruling' type, since they are content to live alongside a public bureaucracy a state of law, and an elected government run by professional politicians. But this does not mean that they are not becoming involved in the domestic politics of their country, at the minimum in order to maintain optimal conditions for the further accumulation of future conservation of their wealth."

"Oligarchs from outside the United States typically take their money out of their countries to resettle it in New York or London."

"...corruption is endemic in finance where the highest profits are to be made by circumventing or outright breaking legal rules on, for example, insider trading, mortgage lending, money laundering, rate fixing and the like."

"...no other industry, except perhaps armaments has developed anything like Wall Street's rotating door relationship with the U.S. government. There is Robert Rubin, treasury secretary from 1995 to 1999 under Clinton, and Henry Paulsen, in the same position under Bush the Younger, from 2006 to 2009 - both former CEOs of Goldman Sachs, the one instrumental for financial deregulation, the other presiding over its results in 2008."

"Doping among athletes competing for ever-increasing sums of prize money and even more lucrative advertising contracts in worldwide winner-take-all markets is accompanied by corruption among officials of international sports associations, some of whom are reported to have been paid huge sums by athletes and their management for suppressing the results of positive doping tests, and by corporations and governments for locating events in places they prefer."

"Corruption...is considered a fact of life, and so is steadily growing inequality and the monopolization of political influence by a small self-serving oligarchy and its army of wealth defense specialists."

"One ominous symptom of growing instability of the democratic-capitalist system is the rise of so-called populist parties, of both the Left and the Right, feeding on and fortifying a deeply emotional rejection of existing social elites."

"Low growth, grotesque inequality and mountains of debt; the neutralization of post-war capitalism's progress engine, democracy, and its replacement with oligarchic neo-feudalism; the clearing away by 'globalization' of social barriers against the commodification of labor, land and money; and systemic disorders such as infectious corruption in the competitive struggle for ever bigger rewards for individual success, with the attendant culture of demoralization, and rapidly spreading international anarchy - all these together have profoundly destabilized the post-war capitalist way of social life without a hint as to how stability might ever be restored."

"While for those at the receiving end disruptive innovation can be catastrophic, regrettably they have to be sacrificed as collateral damage on the Darwinian battlefield of global capitalism."

"In a world without system integration, social integration has to carry to entire burden of structuration, as long as no new order begins to settle in."

"Four broad types of behaviors are required of the 'users' of post-capitalist social networks for the precarious reproduction of their entropic social life, bestowing resilience both on themselves and on an otherwise unsustainable neoliberal capitalism, summarily and provisionally to be identified as coping, hoping, doping and shopping."

"Cross-cutting the distinction between performance-enhancing and performance-replacing drug use is, incidentally, the daily provision of synthetic happiness to an astonishingly large number of customers by means of ecstatic-euphoric feel-good pop music, individually delivered and consumed with the help of advanced information technology."

"[Post-capitalism] .. must also provide technical assistance enabling people to keep themselves unreasonably happy, while at the same time producing a stream of incentives and satisfactions motivating them to constantly intensity their work effort regardless of stagnant or declining pay, unpaid overtime and precarious employment."

From Chapter 1 - How Will Capitalism End?

"...increasing inequality may be one of the causes of declining growth, as inequality both impedes improvements in productivity and weakens demand."

"Government, first and foremost that of the United States, have remained firmly in the grip of the money-making [finance] industries. These, in turn, are being generously provided with cheap cash, created out of thin air on their behalf by their friends in the central banks..."

"Neither a Utopian vision of an alternative future nor superhuman foresight should be required to validate the claim that capitalism is facing its Gotterdammerung."

"...people may get used to [inequality] ... especially with the help of public entertainment and political repression."

"Technological advances with which to buy time, such as fracking, can never be ruled out, and if there are limits to the pacifying powers of consumerism, we clearly are nowhere near them."

"...there is growing unease over the tension, now widely perceived, between the capitalist principle of infinite expansion and the finite supply of natural resources."

"What actors and institutions are to secure the collective good of a livable environment in a world of competitive production and consumption?"

"Labor, land and money have simultaneously become crisis zones after 'globalization' endowed market relations and production chains with an unprecedented capacity to cross the boundaries of national political and legal jurisdictions."

"...five systemic disorders of today's advanced capitalism... ...stagnation, oligarchic redistribution, the plundering of the public domain, corruption and global anarchy."

"Under oligarchic redistribution [to the top], the Keynesian bond which tied the profits of the rich to the wages of the poor is severed, cutting the fate of economic elites loose from that of the masses."

"...the plundering of the public domain through under-funding and privatization ... [had] its origin ...since the 1970s from the tax state to the debt state to..the consolidation or austerity state. Foremost among the causes of this shift were the new opportunities offered by global capital markets since the 1980s for tax flight, tax evasion, tax-regime shopping and the extortion of tax cuts from governments by corporations and earners of high incomes."

"...privatization [was] carried out regardless of the contribution public investment in productivity and social cohesion might have made to economic growth and social equity."

"As productivity growth requires more public provision, it tends to become incompatible with private accumulation of profits, forcing capitalist elites to choose between the two. The result is what we are seeing already today: economic stagnation combined with oligarchic redistribution."

"Finance is an 'industry' where innovation is hard to distinguish from rule-bending or rule breaking; ..where the largest firms are not just too big to fail, but also too big to jail, given their importance for national economic policy and tax revenue; and where the borderline between private companies and the state is more blurred than anywhere else, as indicated by the 2008 bailout or by the huge number of former and future employees of financial firms in the American government."

"...what came to light after 2008 beat everything: rating agencies being paid by the producers of toxic securities to award them top grades; offshore shadow banking, money laundering and assistance in large -scale tax evasion as the normal business of the biggest banks with the best addresses; the sale to unsuspecting customers of securities constructed so that other customers could bet against them; the leading banks worldwide fraudulently fixing interest rates and the gold price..."

"...public perceptions of capitalism are now deeply cynical, the whole system commonly perceived as a world of dirty tricks for ensuring the further enrichment of the already rich."

"New, sophisticated means of violence are being deployed to reassure collaborating governments and inspire confidence in the United States as a global enforcer of oligarchic property rights and as a safe haven for oligarchic families and their treasure. ... They include ...comprehensive surveillance of potential opposition everywhere with the help of 'big data' technology."

From Chapter 2 - The Crises of Democratic Capitalism

"People stubbornly refused to give up on the idea of a moral economy under which they have rights that take precedence over the outcomes of market exchanges."

"The structure of the post-war settlement... ...included an expanding welfare state, the right of workers to free collective bargaining and a political guarantee of full employment, underwritten by governments making extensive use of the Keynesian economic toolkit."

"In subsequent years government all over the Western world faced the question of how to make trade unions moderate their members' wage demands without having to rescind the Keynesian promise of full employment."

"Inflation comes primarily at the expense of creditors and holders of financial assets, groups that do not as a rule include workers, or at least did not do so in the 1960s and 1970s."

"For governments facing conflicting demands from workers and capital in a world of declining growth rates, an accommodating monetary policy was a convenient ersatz method for avoiding zero sum social conflict."

"In both the United States and the United kingdom, disinflation was accompanied by determined attacks on trade unions by governments and employers, epitomized by Reagan's victory over the air traffic controllers and Thatcher's breaking of the National Union of Mine-workers."

"The neo-liberal era bean with Anglo-American governments casting aside the received wisdom of post-war democratic capitalism, which held that unemployment would undermine political support, not just for the government of the day but also for democratic capitalism itself."

"Instead of the government borrowing money to fund equal access to decent housing, or the formation of marketable work skills, it was now individual citizens who, under a debt regime of extreme generosity, were allowed, and sometimes compelled, to take out loans at their own risk with which to pay for their education or their advancement to a less destitute urban neighborhood."

"Financial liberalization thus compensated for an era of fiscal consolidation and public austerity."

"All of this [rapidly growing indebtedness], of course, ended in 2008 when the international credit pyramid on which the prosperity of the late 1990s and early 2000s had rested suddenly collapsed."

[Jason · Rating 5 out of 5]

Meanwhile an astonishing number of parents, single or coupled, have cheerfully adjusted to a high-pressure way of life somehow combining child-rearing with ever longer hours of ever more demanding and insecure employment. Rather than complaining or rebelling, many seem to take the stress as a test of their personal capacity for permanent improvement, much lie high-performance athletes. Living the contemporary capitalist way of life, parents comply with social expectations that they subject themselves in good spirit to the strict regimentation of a self-enforced rigid time regime and take pride in enduring the hardships of a new sort of "inner-worldly asceticism." 22o

[Rob M · Rating 5 out of 5]

Extremely rigorous, economistic analysis of the post 2008 political landscape, with forensic insights into the intersections of politics, finance, democracy and culture. Although this was published before the democratic earthquakes that saw Donald Trump become president of the USA, Britain leave the EU and the implosion of social democratic parties across the western hemisphere, the shape of all these events are clearly sketched out in this highly prescient text.

Streeck argues that the crisis of capitalism has neither happened, nor that it is to come, but that we are living in the interregnum, experiencing morbid symptoms of ever kind. This heavy going text is not for the faint of heart, but will be of enormous value to people looking for a more scientific interrogation of the current crisis than can be found in more populist left publishing.

[Tino · Rating 4 out of 5]

A very solid book. While it doesn't provide very clear-cut answers to many of the questions, I think it's alright since that is hardly the point. Very good food for thought! 4 stars.

[Ian Beardsell · Rating 3 out of 5]

Well...I think I understand most of what Streeck had to say just by reading the introductory chapter. I say "think" because his writing style is somewhat obtuse, academic, and wordy, so I feel that the book is intended for a more academic audience, or at least one with more knowledge of macroeconomics than I have.

Essentially the book is a set of lectures Streeck gave a few years after the economic collapse of 2008-09, fronted by an introductory chapter that well summarizes his thesis. I entirely agree with that thesis, by the way: modern capitalism has basically burnt through the most productive years of growth after WWII, where standards of living rose, western consumerism, which was protected and enhanced by unions, helped drive real economic growth that benefited everyone and secured Western-style democracy as the most obvious political system of freedom. This is what we all believe is the true beneficial face of modern capitalism. The problem, Streeck maintains, is that much of that consumerism maxed out real (necessary) production and caused inflation that prompted democratic governments to try new methods to grow the economy in a stable fashion. After stumbling about with high interest rates and the fallout of higher unemployment, one of the worst experiments was the attempt to grow the economy using artificial financial instruments that produced no real tangible assets, simply cancerous growth, and hence the collapse in 2008. The response we've had since, of free and easy money dumped into corporations who have nothing really novel to invest it in (most simply bought back shares to raise the stock prices), has not helped the average worker whose wages have continued to stagnate at mid 1970s levels.

Ultimately, we have a scenario playing out where worker-consumers are not really seeing economic growth in their purchasing power, corporations are not really creating anything novel and worthwhile for those consumers to buy anyway, and both sides point their fingers at government, which is caught in the middle, to help solve "their" problems. Since Western governments depend on real economic growth to fill their coffers, which is not happening, taxes are being used ineffectively to bolster the profits of corporations that are "too big to fail" in the hopes that this at least keeps the ersatz economy hobbling forward, ostensibly to better days. Hence, we are in a position where traditional western capitalism and hand-in-hand democracy is at a crossroads, which seems murky and uncertain. Streeck sees nothing obvious (or at least familiar) to take its place. Corporations who hold the balance of power in democracy, over actual voters, have defaulted to a position of lining their pockets as quickly as possible, as we face imminent collapse of both capitalism and democracy.

It would seem the the Republican Party in the US understands this, as their recent actions are completely in line with an oligarchy who have abandoned those citizens they should be representing in order to fleece them as consumers and protect their corporate bottom lines. Every day, the news seems to point to what Streeck has posited will be happening: the corruption and failure of democratic institutions, and capitalism only "working" to ensure the survival of those plugged into the most powerful corporations.

Unfortunately, although I am not entirely sure since I was unable to complete all the chapters in this dense book, Streeck did not point out any positive solutions. For example, I wonder what would happen if democratic governments decided to go back to the thinking of FDR's New Deal and make some huge changes to western infrastructure, namely switching to an alternative energy economy. The research and development of alternative power generation and the redevelopment of existing infrastructure could go a long way in providing real economic growth and the production of real things. It would also have the secondary effect of slowing climate change, and possibly making the earth a better and healthier place to live. Of course, you'd have to get the corporate stakeholders who are heavily vested in the old system of petro-economics and older technologies to adapt to something outside of their comfort zone, and that would be expensive for them, which is why it is likely a non-starter. Pity.

[Peter Harrison · Rating 5 out of 5]

Wolfgang Streeck may not in fact answer the question that he poses in the title of this book, but it is still a superb read.

It consists of a set of essays and speeches from the German sociologist published previously in New Left Review (and elsewhere) and organised around the theme of the challenges to capitalism. Each is a thoughtful and valuable contribution to the analysis of modern capitalist, it's impact on society, politics, and environment, and what our options for the future might be.

The opening essay sets the tone. It poses the suggestion that capitalism has so successfully eliminated all opposition to it's conquest of politics and society that it's destructive nature now has free rein without constraint from organised labour or political control. The end result will be the long slow death of capitalism's ability to deliver for the majority of its inhabitants, without the prospect of its replacement by a different system which can pick up the baton as Marx originally envisaged.

The remaining essays work around similar themes. The emphasis is on the impact of the neoliberal project to disconnect the management of the economy from political and social control. This can be seen in Streeck's characterisation of the changing nature of the state leading towards the current "consolidation" state where having passed successively through private debt then public debt stages now exists to ensure that we reliably meet our obligations to asset holders.

Another theme of Streeck is the divide between social rights and free markets. Where the democratic state prioritises providing public services for its citizens identified through elections. By contrast the "consolidation" state prioritises the contractual claims of creditors and the servicing of debt. The tension between these two has been a major driver for social and political change since the second world war.

This is a thought provoking and very readable set of essays which should be of interest to anyone who doesn't accept the orthodox economist world view.

[C M · Rating 4 out of 5]

Wolfgang Streeck is a prominent German sociologist of the old school, i.e. unashamedly Marxist. He is also a prominent public intellectual with exceptional scope, one of the few social scientists to still take on economics and economists. This book is a collection of essays on the failures of (neoliberal) capitalism of the past decades. It is dark and devoid of hope, as Streeck, in essence, stands with Marx that capitalism holds within itself its own destruction. Unlike Marx, he doesn't think it will lead to a social heaven-on-earth.

"How Will Capitalism End" has many thought-provoking analyses and observations, which, while stated in too categorical, deterministic and general terms, are worth of consideration and reflection. He is on point, but not necessarily original, on many disturbing political developments of the last decades and ties things together that are often left separated. Unfortunately, the book is also far too long and repetitious. In fact, anyone not really obsessed with the topic, i.e. the decline of "democratic capitalism" in the past decades, can simply read the first chapter and get the majority of the book. This notwithstanding, in these days an old-school Marxist can sound remarkably refreshing and the book definitely helped me think broader and deeper about the contemporary democratic crisis.

[Paul · Rating 5 out of 5]

Streeck mentions being inspired by Polyani and explains how "fictitious commodities" drive capitalism's death drive toward unattainable growth. He also explains the European situation, touching on problems with the Euro and the inherent instability of having a EU. For Streeck, to be democratic is a virtue. Modern liberal democracies are not democratic because they have no real input on monetary policies and high finance. The social issues clouding the election landscapes provide cover for capitalism to continue on without threat of regulation or conversion to a more humane system. Will capitalism ever end? Streeck clearly lays out how things have gotten worse by necessity for members of a capitalist society, but there seems to be no end in sight unless public consciousness suddenly changes. Streeck's love for democracy is probably his weakness. Just as capitalism must hurtle forwards until there is nothing left to commoditize, so democracy has devolved to a farce of advertising, personality, and ritual. His analysis of Schmitt includes the famous line that the exception proves the rule. Streeck rejects seeking a more moderate form of capitalism - maybe democracy should receive the same treatment, as its exceptions have proven it to follow an unacceptable rule.

[Alistar Flofsky · Rating 5 out of 5]

An emerging neo-feudal relationship between private wealth and the public sphere
„One might have mentioned declining overall growth rates intensifying distributional conflicts and sharply paring down the willingness of the rich to make concessions to the poor. One could also have spent more time on what I believe is a particularly important aspect of the weakening of states and governments, which is the immense capacity today of rich citizens and corporations to escape taxation by moving income to low-tax jurisdictions, or capital to tax havens. The results include a weakening ability of states to redistribute to the bottom of their societies, together with increasingly degressive taxation and rising indebtedness of underfunded states unable to discharge their obligations to their citizens with their stagnant or shrinking tax revenue. An upshot is the growing dependence of citizens on private borrowing to compensate for declining public services and supports. Moreover, rising public debt means a growing share in public spending of interest payments to creditors, putting pressure on social expenditure and public investment. Oligarchic redistribution thus comes with a neoliberal rebuilding of the state, manifested among other things in a shrinking public sector. Public poverty opens a space for oligarchic philanthropy, in an emerging neo-feudal relationship between private wealth and the public sphere.”

The exciting issues filling the public space
„Emptied of distributional politics, Hayekian democracy is free to busy itself with national interests and international conflicts, especially on the exotic margins of the capitalist world, or with the public spectacles offered by the personal rivalries and private lives of competing leaders. Culture wars, ‘family values’, lifestyle choices, ‘political correctness’, the age and sex of politicians, and the way they dress and look and speak deliver an unending supply of opportunities for pseudo-participation in pseudo-debates, never allowing for boredom to arise: whether the foreign minister should or should not have his male companion accompany him on a state visit to the Middle East; if there are enough women cabinet members, and in sufficiently powerful positions; how female ministers attend to their small children, too little or too much; whether the president of the Republic should use a motor cycle when visiting his lover; and how often a week the minister of economic affairs takes his daughter to Kindergarten in the morning. With exciting issues like these filling the public space, who will want to hear about the entirely predictable failure of international financial diplomacy to agree on meaningful regulation of offshore banking and the shadow banking system?”

The cultural turn of progressive democratic politics
„Can a democratic renewal – a re-establishment of the primacy of democratic politics over the inherent dynamics of capitalist development – really be expected from a public no longer used to taking politics seriously, after decades of re-education in the spirit of what Merkel calls the ‘cultural turn of progressive democratic politics’ – like the struggle for gay marriage, the symbolic ‘gendering’ of everything, and the promotion of high-class women to high-class management positions on the boards of large firms as a signal policy objective of, one would not believe it, social-democratic parties and trade unions, at a time when the greatest risk of poverty is associated with being a single mother? How much serious politics are the democratic masses, politically expropriated by their ‘responsible’ cartel parties, willing and able to concern themselves with? Under the spell of post-Fordist consumerism and post-democratic politainment, how many people still believe that there can be collective goods worth fighting for? In a world where the culturally most highly esteemed skill seems to have become the competitive coping with adversity in good spirits, as opposed to establishing common interests with others and organizing for them – where democracy has been emptied of serious content and politics trivialized beyond recognition – democratic participation, as Merkel reminds us, is all too easily mistaken for the saving of whales and similar local improvements, replacing political conflict with the public expression of private moral convictions: a depoliticized pluralistic laissez-faire under which political participation is turned into something like a morally correct form of advanced consumption.”

Today’s political-economic theory
„Today’s political-economic theory is typically one of two sorts. In the first, capitalism is reduced to a reified ‘economy’ conceived as a wealth creation machine – one that functions according to distinctive laws of nature esoteric enough to require a specialized natural science, economics. Politics operates on the economy from the outside, as if it were a black box, making it produce desired outputs by providing it with the right inputs. In the second, rather than an inert object of more or less adept technical manipulation, ‘the economy’ appears as producing inputs for politics, in the form of competing group interests, preferably presenting themselves as functional imperatives of efficient economic management, that need to be politically adjudicated.”

Debtor and Creditor countries
„That we are in fact facing a severe crisis of democracy and not just of the economy should by now be obvious. In Europe, under the pressure of financial markets, national leaders are systematically transferring decision-making power to international organizations, taking authority away from national parliaments and, by extension, electorates. Debtor countries have no choice but to accept the dictates of their creditors, with national elections rendered meaningless for decades to come. Creditor countries, for their part, are driven by ‘the markets’ to respond rapidly and flexibly to the latter’s fluctuating needs and capricious demands, which leaves little time for their parliaments to exercise their democratic prerogatives.”

[Paula · Rating 2 out of 5]

I checked out this book because the title was intriguing. Unfortunately, the book never addresses the end of capitalism at all, beyond suggesting that it could end. This is actually a series of essays, only marginally related, that cover different aspects of capitalism's failures in America and Europe. The emphasis seems to be on the incompatibility between capitalism and democracy. Even if they had titled the book How Capitalism Fails, which would have been a more appropriate title, it still is not a very good book. As I said, there is no continuity from chapter to chapter, and the writing leaves much to be desired. There are a few good points made in the book, and may be worth it for stalwart readers interested in what's wrong with capitalism, but I don't recommend the book for anyone else.

[Jim Parker · Rating 4 out of 5]

Utterly logical and damning indictment of the neoliberal dogma that has infected the western world for much of the last 40 years. Turning every aspect of human life into a market-driven commodity has been a disaster. Basing all our relationships on a transactional view of the world has been a debasement of our humanity. And driving consumption through a cycle of ever increasing debt and ever decreasing dignity has been a depressing indictment of the power of market institutions and the media to manipulate the framing of the economic argument in a way that destroys everything of worth. Not a fun read, but an enlightening one.

[Bookforum Magazine]

"It may be that this is the dawn of a true neoliberal tyranny, in the service of an empowered oligarchy–one that will put the eurozone to shame. We don't know yet. What is clear is that the arrangements that have guaranteed capitalism's survival for decades are transforming before our eyes, and our models can't predict what's coming next."

–Jamie Martin on Wolfgang Streeck's How Will Capitalism End? in the Feb/Mar 2017 issue of Bookforum

To read the rest of this review, go to Bookforum:
http://bookforum.com/inprint/023_05/1...

[Belinda Carvalho · Rating 5 out of 5]

I see the issues in this book all around me. Great analysis of the problems with capitalism and why they aren't being addressed.

[Andreas · Rating 4 out of 5]

A short essay in Swedish:

https://andreassorterar.wordpress.com...

[Maxim · Rating 5 out of 5]

Even if one disagrees with a lot of the books’ claims (as I would do, especially it’s fairly pessimistic outlook), it’s hard not to admit that this is a striking work of bold and thought-provoking theses.

Streeck makes a strong case for a new look at capitalism and its history since the 1970s, an ongoing tug of war and uneasy truce between “social justice” and “market justice” resulting in ever more dramatic crises: first the public spending-fuelled inflation crisis of the 1970s, the public debt crises of the 1980s, the private-debt fuelled expansion (and ultimately crisis) of the 1990s/2000s, culminating in the 2008/09 financial crisis and Eurocrisis.

Culminating from this, Streeck sees three tendencies that will ultimately put an uneasy end to capitalism: persistent economic stagnation (exacerbating distributional conflict); ever rising indebtedness on all levels, which will ultimately become wholly unsustainable; rising inequality, fuelling and being fuelled by the first two trends and leading to political discontent.

Written in early 2016, Streeck must (rightly in my view) feel absolutely vindicated in his pessimistic outlook by the rise of Trump, Brexit and economic populism from the left and right.

The book is a scholarly work (and the chapters have previously been published in academic journals, so there is also some overlap between them), but at times it drifts into polemicism - which actually makes it a more enjoyable, albeit provocative, read.

Some of the trends that Streeck sees have not continued or even reversed: persistent high unemployment (at least prior to COVID), lack of financial services regulation (in the eye of the beholder of course, but a lot has happened there), clamp down on tax havens (again, subject to debate, but tax transparency is orders of magnitude higher today).

Writing as a sociologist, and to some extent at the margin of his profession which has not taken up bold theories about capitalist societies, Streeck delivers a strong contribution to the literature on capitalism and its future from a unique perspective. What is quite surprising though is that he is not recognising any of the “critical theory” literature which in many regards (eg the focus on Polanyi) quite close to his approach and thesis.

Overall it’s a very worthy book, and a stark warning of the dangers ahead - especially for those (like me) that would like to see the model of liberal market democracies continue, rather than find an agonising end.