Peter Green’s Reviews > Critical Encounters: Capitalism, Democracy, Ideas > Status Update

Providing funding and other support to the parties, and insulating them from voters. Achieving roadblock can be sufficient - it can cause what H&P identify as policy ‘drift’. Neutralising the state in this way can serve as an equivalent to globalisation in a state still strong enough to do what it likes.

The US, which he ignores, doesn’t fit his mould. Parties have become increasingly polarised and policy-seeking, although this has occurred asymmetrically (GOP). Yet it isn’t voters - their preferences have remained largely unchanged. Hacker and Pierson explain this as a result of interest groups, which Mair barely mentions. They argue that in the US business serves the role Mair ascribes to the state in Europe...

Mair gives us two causes: macro (globalisation) and micro (individualisation), but fails to discuss whether they are linked. Possible links include globalisation’s uprooting of class structures, and consumerism’s individualising cultural effects.

Something else to be explored it whether a mass party could survive in today’s society. Marr says social bases are individualised and fragmented, which is true but doesn’t go far enough. Individualisation as he paints it is just the surface of a more profound change in social relations - a growth in short termism and volatility in all our social relations and commitments, including politics, family, work

...of excessive popular demands, politicians are in a bind. It is unsurprising that they chose the side of capital (‘economic responsibility’) and therefore accepted the need to insulate themselves from popular pressure, beginning the ‘mutual withdrawal’.

Capitalists need public spending (though not too much), but would obviously like to avoid tax. As demands for spending increase and taxes become harder to gather, debt offers an easy way out. Capital loves public debt as an alternative to tax - it gets to loan (at interest, in normal time’s) what would otherwise be confiscated (as tax). Even zero interest debt has to be paid back, unlike tax.

This is remarkably similar to radical explanations pointing to monopoly capitalism. PIMCO says only 3 things risk raising interest rates: a surge in deglobalisation, aggressive antitrust policies that overturn superstar monopolies, and a surge in labour bargaining power. They don’t consider these likely, but as Greenspan noted interest rates can only go up, and when they do it will be devastating for stock

Investment house PIMCO told its clients in 2017 that the reason for permanently low interest rates was not central banks, but ‘superstar firms’ - firms that make higher profits, save more, invest less and pay out a smaller share to labour. This explains the global excess of saving over investment, rising inequality and low wage inflation despite falling unemployment. All this contributes to low interest rates