- Hello and good morning everybody.
- [Students] Good morning.
- Today our agenda is
going to be threefold.
I'm going to review some
of the central themes
of the course to begin with,
then I'm gonna talk about four
paths not taken as a way of,
rather than giving
a mechanical summary of
the previous 25 lectures,
to pick out
the four central areas where,
as I said early on in the course,
we're gonna be paying attention to paths
that might've been
taken that weren't taken
when they were a scope for choice,
and then finally we're gonna end
with agendas for democratic reform,
the sorts of political reforms
that would make it more likely
that the kind of policies I have been
discussing in the last two lectures
could actually be successfully pursued,
but let's go all the way back
first of all to September.
There were really two central
motivating questions of the course.
The first is,
how did we get from the
euphoria and optimism
that we say at the end of the Cold War
to the politics of fear and resentment
that has swept so much of the
democratic world since 2016?
And then, secondly,
what are the prospects for a
better politics going forward?
So if we reflect on those two questions
from the standpoint of
what we have been doing
over the past three and a half months,
I think there are two related
answers to the first question.
The first one is,
especially in the period
of what I was calling
the early post-Cold War era
that is up to the financial crisis,
geopolitical arrogance
and uncritical embrace
of neoliberalism at home
and the Washington consensus abroad.
If you wanted the bumper sticker
for the geopolitical arrogance,
there are plenty of candidates,
but I think this anonymous,
what turned out to be Karl Rove quotation
that I showed you earlier is probably
the winning candidate when he said,
"We're an empire now, and when we act,
"we create our own reality.
"And while you're studying that reality,
"judiciously, as you will,
"we'll act again, creating
other new realities,
"which you can study too,
"and that's how things will sort out.
"We are history's actors
and you, all of you,
"will be left just to study what we do,"
and this was
in October, 2004,
in the run-up to the election
in which George W. Bush would be reelected
and unusually with increased
majorities on Capitol Hill.
Usually the president's party loses seats
in his reelection bid,
but he actually increased
his majority in 2002 as well.
So there was some reason for
that arrogance you might think
and it certainly informed their policies
in the international arena.
If you wanted the winning
bumper sticker candidate
for the uncritical acceptance
of neoliberalism at home
and the Washington consensus abroad,
it has to be this statement
by Alan Greenspan.
- Have looked to the self
interest of lending institutions
to protect shareholders'
equity, myself especially,
are in a state of shocked disbelief.
- As you will recall,
we played the longer
excerpt of that interview
in which he admitted that
his models had broken down,
and I think that that again captures
the uncritical acceptance of
the neoliberalism at home,
Washington consensus abroad.
If I talk about the second big answer
to the first question,
it has to be the failure to take account
of the long-term changes in the national
and global political economies.
Just to remind you again here of some
of the key points about this,
this is a slide I showed you
of the mirror image of
the graphs depicting
the decline of industrial jobs over,
this is 26
OEDC countries between 1960
and 2018
and the fragmentation
of political parties,
the weakening of political parties,
and I told you a story about that.
As left-of-center parties
became less able
to defend unionized workers,
they defended them less well,
and they defended fewer and fewer of them
and so workers hemorrhaged
to other parties
as in, say in Germany to Die Linke,
the far-left Marxist party and The Greens,
and eventually
to populist parties such as the
Alternative fur Deutschland.
This in turn led to fragmentation
of parties on the right
as they saw opportunistic
possibilities of picking up seats
and so we get this very substantial
fragmentation of political parties,
which is gonna have an
impact on their capacity
to protect the interests
of workers over time.
This reflects a much broader trend.
This is the picture from the U.S.
Of the decline of union membership.
As industrial jobs have gone away,
unions have gotten smaller and smaller,
particularly private-sector unions,
and we saw how that coincided
with the growth of inequality,
the hollowing out and stagnation
of middle-class incomes,
and the declining fortunes
of the middle-class,
both in absolute terms as they
faced harder and harder difficulties
in achieving the same real income,
often having to go from
one to two earners,
being decreasingly able
to afford college for their children,
and often having to finance their children
well into adulthood.
So this is a broader context
where we've seen this impact
of globalization,
technology, and slow growth.
We have aging populations in many
of these developed countries,
which has put increasing
stress on their fiscal states
as ever shrinking employed,
what we call
the non-dependent part of the population
is supporting an ever
increasing dependent population.
The collapse of the corporatist consensus
between business and labor that underpin
many of the social
democratic welfare states
in the post-World War II era
which really depended on
relatively large, stable,
labor-oriented parties
making deals with relatively
large stable business-oriented parties
that were then blessed
through the political system
and maintain the social democratic order.
All of that has been weakening shrinking
and so we have had this
fragmentation of parties.
All of this has made it much harder
for governments to govern and has led
voters to make demands for reform,
some of which we have talked
about in a previous lecture
and some more of which we
are gonna talk about today,
and it's led to the rise
of anti-system parties.
One of the if you like
tragedies of the politics
of the last several decades is the extent
to which political reforms have been
fixing things that were not broken.
We saw this I think
particularly dramatically
in the United Kingdom in the 1970s.
Aside from the war decades,
the 1970s were surely the most challenging
economic decade that Britain experienced,
although they certainly were not alone.
The '70s were very difficult
here because of the oil shocks
from the Yom Kippur War in 1973.
The advent of stagflation is hitherto
an unexperienced combination
of high inflation and low growth,
job stagnation, high
inflation, high unemployment,
very difficult to manage,
and as Anthony King's excellent book
"The British Constitution" argues
in was this period
which led people to say,
the political system is failing us
and we need to start reforming it.
Very comparable developments occurred
in many of the other
capitalist democracies.
So when the economy is going
badly and if the sources
of the pain are not addressed
by the political system,
people all want to attack
the political system
and say it's failing us,
even if the problems,
as was the case with much of
the stagflation of the 1970s,
were actually exogenous.
So I think these are the two big answers
if you like to course:
the arrogance and uncritical acceptance
of the dominance of the American's
model of democratic capitalism
and the American approach
to international
geopolitics on the one hand,
and the failure to appreciate and think
about the implications of these
long-term changes in
the political economy,
which had indeed been going on since
well before the end of the Cold War
and would play themselves out
in the subsequent decades.
So I think those are
the two central answers
that I would give us to the question
that I posed at the start of the course.
What I wanna do now, though,
is think about what might have happened?
What could've been done differently?
And I wanna pick out as a way
of summarizing and reviewing
much of the material that we have covered
four particular types of
path, taken or not taken,
where there was relatively
unusual
scope for choice, for
agency, as I'm gonna call it.
You might recall that
earlier in the semester
I said that we need to think
about political outcomes
by reference to three of my I words.
So I have a penchant for I words.
I said one was institutions,
one is interest,
and that one is ideals,
or we might say ideas or ideologies,
and the constellations
of interest, ideals,
and institutions shape what can be done.
You might think that
the capacity for agency
as I'm calling it here is
sometimes more constrained
and sometimes less constrained
by the interests, ideas,
and institutions that
structure a given situation.
So if we think about the Cold War,
this was a period in which there was
very little capacity for agency
because the interests on the two sides
were pretty much baked in.
The coalitions,
at least until Nixon's opening to China
started to split the Communist
coalition in the Cold War,
but at least until that point,
the interest were really,
we had these two snarling
coalitions of forces,
institutions were largely
either baked into the conflict
as with the Warsaw Pact and NATO,
or irrelevant, as with the United Nations,
which was largely beside the point
in such a realist-dominated conflict,
and then ideas and ideologies were
also largely baked into the conflict.
George Kennan had sort of
summed up the American attitude
that it wasn't worth trying
to argue the merits with
the Soviets because they
were locked into their
own ideological prism
and they certainly saw
the West in the same way,
that it was all
bourgeois can't coming out of radio
through Europe or wherever it might be.
So the Cold War was an era in
which the capacity for agency,
to actually change things,
was very constrained that, if you like,
that triangle
of constraints was very small,
but there are times and
I mentioned this to you
right at the beginning of the course
when those constraints can
loosen up, when suddenly,
we know now from the
divide-a-dollar story, for example,
coalitions can start to break apart
and unlikely coalitions
might begin to form.
We saw this for example
in the South Africa case
where the traditional
coalitions completely fell apart
and the ANC and the Inkatha Freedom
and the national party government formed
a kind of coalition against Inkatha to get
the new rules adopted.
We also saw
in the post-Cold War era and
also in the South Africa case
that ideologies and ideas
can suddenly become freed up.
So the hard right wing Afrikaners
ended up making an alliance
with Buthelezi's Inkatha Freedom Party
and would be photographed
standing together in ways
that would've been unthinkable in terms
of the Afrikaner ideologies
of even a few years prior,
and institutions can change.
We will see how the
institutions did indeed change
once the Cold War was over.
We saw that there was a scope both
for the reorientation of
existing institutions,
most notably, NATO,
and also the creation of new institutions
such as the system of rules enacted
for the responsibility to
protect in a post-Cold War era.
So there are circumstances
in which this triangle becomes larger,
and suddenly
it's possible to do things differently
and there are real choices
for the players at the time,
and of course that window,
something of a mixed metaphor
here of triangles and windows,
but that window of opportunity
doesn't stay open indefinitely.
It will close again
as things solidify
and it becomes harder to make changes
that might've been easier
at a different time.
We've seen this somewhat,
but classic example is if
there's a lot of dissatisfaction
and a country changes its electoral system
that then new politicians get
elected under the new rules,
so they are gonna be very disinclined
to change it again in the future.
So as I said the 1970s create a lot
of dissatisfaction with existing
electoral institutions in
many parts of the world,
changes were made,
but then it becomes harder
to change them again.
So let's start with the first
of these paths not taken
and I think that the
most important
one here,
certainly the first one I talked
about during the Cold War was
the decision to expand
NATO after the Cold War
to consume what would eventually be
all of the Warsaw Pact countries
and even make overtures
to Georgia and Ukraine.
It's worth going back
to thinking about this.
How this started,
this first came onto the agenda
when the Berlin wall came down and it was
obvious that Germany was gonna be reunited
and of course Gorbachev was very worried
that this would mean East Germany
would become a member of NATO,
and East Germany had been a
member of the Warsaw Pact.
Very substantial assurances,
there was gossip about it at the time,
but we now can see from
declassified documents
that it wasn't just Kohl
and Baker who promised
Gorbachev that there would be
no expansion of NATO into
the former Soviet empire,
but many others,
you can see here on the
bottom of the slide,
all gave assurances to that effect
in early
1990,
and this was a promise that was
gone back on first in the
Clinton administration.
In 1998,
the Clinton administration took
the decision to expand NATO
to include Hungary, Poland,
and the Czech Republic.
The decision was made in about 1996,
but it actually came on board
in 1998.
In May of that year,
the journalist, Tom Friedman,
called up George Kennan,
the architect of containment
about whom you heard in earlier lectures,
and he asked him for
his opinion about this
and it's worth paying some
attention to what Kennan said.
He said, "I think it's the
beginning of a new Cold War.
"I think the Russians will
gradually react quite adversely
"and it will affect their policies.
"I think it's a tragic mistake.
"There was no reason for this whatsoever.
"No one was threatening anyone else.
"This expansion would make
the Founding Fathers,"
of course he's alluding to the fact here
that the Founding Fathers
opposed all permanent alliances,
"would make the Founding Fathers
"of this country turn
over in their graves.
"We have signed up to protect
a whole series of countries,
"even though we have neither the resources
"nor the intention to do
so in any serious way.
"NATO expansion was simply a
lighthearted action by a Senate
"that has no real interest
in foreign affairs."
So this was a prescient observation
that this was not going to go
over well with the Russians
as by this time it was of course
Yeltsin in charge of Russia
and he was
deeply troubled by it.
Indeed there's more to
the prehistory of this
than I told you during
the original lecture
in that during the late
1980s, Gorbachev had made
several overtures to the West.
He, three times brought
up the prospect of,
he thought at that time the Soviet Union
was not gonna fall apart, it
wasn't being thought about,
but that they might themselves join NATO.
There was some discussion
of this with Western leaders
and it was sort of
deferred into the future
and Yeltsin too had, in print,
said that it was
a long-term
plan or policy of the Soviet
Union eventually to join NATO.
Indeed even in 2000,
when Yeltsin came to power in Russia,
he approached
the Clinton administration
about the possibility of Russia,
not only of Russia not only joining NATO,
but also the European Union,
and they had been brushed off by this.
If you're interested
in more granular depth
on these proposals and rejections
and proposals and rejection,
if you Google up the
journalist, Vladimir Pozner,
a very interesting,
you would never believe he's actually
French by birth, French journalist,
but who's worked for many years
in the U.S. and now works in Russia,
he has an excellent video.
It was actually a lecture he gave at Yale.
I think he was probably a
Poynter Fellow or something.
If you Google up Vladimir
Pozner at Yale University,
you'll find this lecture on YouTube,
really a riveting account
of the missed opportunities
to incorporate Russia
into the New World order
in a way that would have made them
much more likely to be
part of the solution
than part of the problem,
and of course this isn't
just retrospective.
In 1991, when the Soviet
Union finally fell apart,
Mitterrand, who was at that
time the president of France,
said, "We should just disband NATO."
The French, as we saw
playing out yesterday,
the French have a long history
of skepticism toward NATO.
de Gaulle didn't really like it
and actually he kicked
NATO troops out of France
on several occasions and took France
out of the command-and-control systems.
So it's never been a lot of love lost
between the French and
NATO and indeed they
insisted on having their own
independent nuclear deterrent,
which NATO was designed to prevent
the incentive to do that sort of thing.
So when the current
French president said NATO is brain-dead,
he's walking into a well-worn tradition
of France's skepticism towards NATO,
but there it is, there
was a path not taken.
Mitterrand could have prevailed,
and it does seem like
there was surprisingly
little discussion of the possibility
of creating a different world,
that instead that decision
that was taken in 1996
and implemented in 1998
as I detailed to you
was followed up by the gradual inclusion
of all of the NATO countries
and overtures to Georgia and Ukraine,
which had a lot to do
with the Soviet policy
toward Georgia in 2008
when they went in there
and their attitude toward Ukraine
once the election in 2014 came around
and it was clear that their
base at Sevastopol was
going to be jeopardized
and that was a real concern
if Ukraine had joined NATO
and/or the European Union.
So you could ask yourself
sort of in the domain of
counterfactual history,
what kind of geopolitics
might we have today
if that was not the
choice that had been made
and instead either the
incorporation of the Soviet Union,
and then Russia into the
new geopolitical order
as a full partner and participant,
or the disbanding of NATO which after all
was a defensive alliance against a foe
that had no longer
existed and was gonna turn
into an alliance in search of a mission
which we saw playing out
rather depressingly in the Libyan conflict
about which I'll have more
to say in a few minutes.
So that's a clear case
of a path not taken.
Of course we don't know what the path
would have yielded if
we had gone down that,
but it would've made the New World order,
once America's capacity
for unilateral action
was revealed to be chimerical
after the debacles in
Afghanistan and then Iraq,
it would've made it much less likely
that geopolitical
relations would've settled
back into something not that different
from what they had looked
like during the Cold War.
So I think Kennan,
who had been prescient
about so much in his life
when he had advised against Vietnam War,
when he had
advised against militarizing NATO
in the early years of the Cold War,
was extremely
prescient in 1998 in pointing out
the folly of the Clinton administration
in expanding NATO onto Russia's doorstep
or beginning the expansion of NATO
which would eventually extend
not only to Russia's doorstep,
but to at least two of the former
republics of the old Soviet Union.
So a second path not taken
also in the realm of geopolitics
I put under the heading of the management
of geopolitical crises and
humanitarian intervention,
and here
George Herbert Walker Bush
really pointed the way to
a new containment regime
in the first crisis after the Cold War
when Saddam Hussein's Iraq invaded Kuwait.
The question was:
how would the international
community handle this?
And the answer was essentially
a global containment regime
that the bumper sticker for containment
as I have said to you in earlier lectures
is stop the bully without
becoming a bully yourself.
So what did Bush do?
First of all,
he got authorization from the
international institutions
as they then existed,
namely the Security Council.
He put together a massive coalition
that included very diverse players
including every Arab
country except Jordan.
He then expelled,
with that coalition,
expelled Iraq from Kuwait,
and against the advice of
many hawks in the U.S.,
and particularly the neoconservatives
who we talked about in an earlier lecture,
he chose not to go for
regime change in Iraq,
but instead essentially
create no-fly zones
and buttoned-down the Iraqi regime
and make it impossible for them
to threaten their neighbors.
So if that had become the model
for dealing
with geopolitical crises
in the wake of the end of the Cold War,
we would again I think
be looking at a very
different kind of geopolitical reality.
Instead though
George W. Bush abandoned
this with his unilateralism
after 9/11 where he talked
about coalitions of the willing,
forced countries to choose,
if you're not with us,
you're with the terrorist.
By the way the big impetus
for the expansion of NATO
as I mentioned came about
because he wanted to get many
East European countries to
commit to the war effort in Iraq
and the quid pro quo for that was
that they would be able to join NATO,
which many of them did the following year.
So the paths not taken
here in Afghanistan:
the possibility which was advocated
by some in the military at the time
was to ignore the regime in Kabul
when they refused
to turn over Al Qaeda
and to close the camps
and instead to have just gone in ourselves
and finish the war with Al Qaeda.
Instead because we were committed
first of all to fighting
that war on the cheap,
we wanted to fight it with
the Northern Alliance,
and their agenda was regime change,
and so by mission creed it
became America's agenda,
saddling us with a puppet
regime that wouldn't
be able to sustain itself into the future.
The commanders on the ground
were telling the White House
before the end of 2002 that a deal
would have to be made with the Taliban
as the other forces were not gonna be
sufficiently powerful
to govern the country.
Again that was ignored
and instead we created
a puppet government.
"If you break it, you own it,"
as Colin Powell once said.
We then became responsible
for the administration of this country
which at some level continues to this day.
We also failed to defeat
Al Qaeda which escaped through
the mountains into Pakistan
and indeed became the
staging area not only
for future reconstitution of Al Qaeda,
but also for the exiled Taliban government
that would eventually work
its way back into Afghanistan.
In Iraq,
we failed to see
that knocking off the regime in accordance
with the desires of the
neoconservatives would first of all
not produce a government that
was likely to be democratic,
and even if democratic,
would not necessarily produce a government
that would be friendly
to the United States.
We talked at some length about the naivety
of the neoconservative view
that if you just get
rid of authoritarianism
that not only will democracy flourish,
but it will be pro-American democracy.
Neither of these things turns
out necessarily to be true
and so they had their eyes firmly fixed
on the Eastern European countries,
which would all have pre-World War II
histories of democracy.
They would've done a lot better to look
at the former Asiatic
Republics of the Soviet Union
for what was likely to happen in a country
like Iraq with its per capita income,
its lack of a diversified economy
or a middle class that was independent
of the government's control
of the gateway to wealth and prosperity.
So we became embroiled instead
in this ongoing conflict in Iraq.
The other thing that they failed to see
was that the capacity to defeat an army,
we defeated the Iraqi army in four days,
does not translate in the
capacity to govern a country.
This is the fatal error of
thinking just because we
are the most powerful
military in the world,
we can knock off governments
and putting governments
who will then be able to govern.
There are many economies
of smallness in governing.
You need street-level buy-in,
you need street-level commitment
from various broker groups
and you need to empower
local institutions,
which we had obliterated.
We largely obliterated the army,
the civil service and the police
and it was not surprising
that that country would be
headed for decades,
more than a decade of chaos.
So then we can think not
only of that tragedy,
but the tragedy of responsibility
to protect from Rwanda through Libya.
Rwanda was the never again.
We then had Kosovo and it seemed
like a unilateral intervention.
It was by NATO,
again without the permission
of the UN Security Council
because the Russians and Chinese
were supporting Serbian sides
so there was no question of
international authorization.
There was an intervention that
appeared to be successful,
even though it provoked
virulent attacks
in the global south,
from South Africa, from India,
and from others as expansions
of Western imperialism.
It provoked the African Union to declare
that it had unilateral
authority to intervene
in member countries on
humanitarian grounds,
even though the UN Charter
extensively reserves
that authority to the Security Council.
So what we were doing
there was somewhat eroding
the authority of the UN
and the Security Council.
We saw how the UN tried to sort
of reign in and domesticate
this idea of responsibility to protect
by authorizing the Security
Council to authorize it,
and then we saw the tragic
way it played out in Libya
when the Obama administration,
which was quite divided
and against the advice of his generals
but in the thrall of the ideology
of responsibility to protect,
being pressed by some
in the administration,
and eventually Hillary Clinton
at the behest of not very
credible interests of
people who were looking
to ensure oil concessions from what they
thought was gonna be the new government,
this whole doctrine became a smokescreen
for knocking off the
Gadhafi regime, which then,
because of what IR theorists
call the moral hazard of intervention,
became an accelerant
of the Syrian conflict
as the Syrian demonstrators
against the Assad regime
reasoned that if only
they rose up, NATO would
come and help them too,
which of course they didn't,
and then the Assad regime came down
on them like a ton of bricks,
not to mention the collapse
of the Libyan state
created an arms bizarre across
the whole of North Africa
as many people made lots of money,
and it also created a foothold
by the way for Al Qaeda in Libya.
So terrible tragedy,
and this doctrine of the
responsibility to protect
was essentially hijacked by American
and its allies' unilateralism
as expressed through this now
NATO organization that had lost
its raison d'etre and was becoming
the self-appointed policeman of the world,
which is unlikely to
win it much legitimacy,
except among people
whose acceptance of it was not needed.
So you might ask yourself again,
as with the expansion of NATO,
what world might we be living in
had the responsibility to protect doctrine
not morphed into one
more piece of camouflage
for the unilateralism that
had become so fashionable
after the collapse of the Soviet Union,
and particularly after 9/11?
So that's a second area where there were
real choices that could've
been made differently,
but were not and have left the world
in a much different place and the idea
that responsibility to
protect could be rehabilitated
now is extremely difficult
because the way it played out
has been baked into the
conflict in the Middle East
as it since evolved with Russia
filling the gap in the Syrian Civil War
and if you like my triangular
window of opportunity,
to experiment with that doctrine
having been dramatically shrunk.
Paths taken and not taken by business.
So here it's just worth
pausing to ask the question:
why is business so important?
Why focus on business?
And the answer to that question is
that once communism as an economic system
has been taken off the table,
capitalism essentially
is the only game in town.
There is no serious competitor,
maybe not even a frivolous
competitor to capitalism.
You think about Islamic fundamentalism.
One thing Islamic states lack is
any kind of political economy.
If they have an economic theory,
it comes from the 14th century.
They have no conception
of an alternative way
of running political
economy than capitalism.
If you look at Islamic
fundamentalist countries
such as Libya or Saudi
Arabia, they just do it badly.
There's no alternative.
Well, if there's no alternative out there,
that means
that capital is gonna be
in a uniquely powerful position,
particularly in this
world in which labor is
weaker and weaker and
organized labor has shrunk.
This is basically a Hirschman story
that business can go anywhere
at the click of a mouse,
capital can move anywhere
at the click of a mouse
and labor has very high exit cost
because you have to pack up
and move and find another job,
and move your family and so on.
So the differential capacity for exit
between business and labor means
that business is more and more important
and the idea that informed some
business elites during the new deal
that we need to worry that
America's workers might conclude
they have nothing to lose but their change
ceases to be important because there isn't
an alternative out there competing
for the hearts and minds
of American workers.
So businesses is now
in this unique position
that it's hugely consequential.
It's not really counteracted
any other interest.
Maybe there are
conflicts of interest
within business elites,
but it's not really counteracted
by any other interest,
and that means that unless
business is part of the solution,
it's gonna be part of the problem.
You could imagine a continuum
and ask yourself, a continuum.
One is where you have
predatory capitalist class,
as in Russia,
and another would be if you have
a very progressive capitalist class,
as in some Nordic countries and has seem
to be possibly happening in South Africa,
at least during the 1980s.
And then the questions become,
so what makes it more likely
that business will move
toward the progressive
end of the continuum
rather than down toward the
predatory end of the continuum?
So that's why business matters.
Indeed,
as we argue in my book
with Michael Graetz,
"The Wolf at the Door"
thinking about changes in social policy
that are not gonna command
support from substantial amounts
of business is probably a waste of time.
So if we think about business in sort
of under two headings,
one we talked about some with the role
of business in regime change,
which we talked about in
relation to the Soviet Union
and we talked also about it
in relation to South Africa,
you can say two cheers for
the South African story,
two, but not three.
So the two cheers are
devoted to the fact that in the 1980s,
the South African business
elites did discern
the possibility of both
facilitating regime change
and influencing the ANC to think
about how the world
economy was then operating
and was gonna be
operating into the future.
They became the kind of
handmaidens of the transition
in that as I said business did
encourage the South African transition.
The old regime was falling apart.
There was no question that
apartheid was unsustainable,
but that didn't mean it was gonna
have a transition to a democracy
or that the transition
was going to be peaceful.
It might well have been
replaced in a military coup,
which people at the time,
some feared it might have just become
increasingly repressive
and cease to be even
sort of quasi-democratic as it had been.
It might have descended into a civil war,
which by the 1990s had already erupted
in the eastern part of the country.
So what business did was a huge amount
of very creative and intelligent work
that we talked about in that case
to broker the deals
and get the transition,
keep it on track when it
seemed to be falling apart.
And when it did finally fall apart,
do the back channel negotiations
to produce an agreement and eventually
the election in 1994.
The reason I say two cheers
rather than three cheers is
that thereafter South African
business did very little.
It retreated into the sort
of normal stereotypical view
of business that the business
of business is business
and leave politics to the politicians.
A few lone voices like
Christo Nel who said,
"No, we should be actively
transforming our companies now,"
before we are hit over
the head with what would
eventually become black
economic empowerment
and talk of seizing land and so on.
Business should continue
to be ahead of that curve,
so if you like shape that destiny
rather than ending up being shaped by it.
So we see this has played
out in the social indicators
I showed you of South Africa today.
The morals of Israel and Palestine story.
Again there've been business groups
that have tried to participate,
but it's very difficult if
they don't have a K group.
It's very difficult if they don't agree.
It's very difficult if they don't
show themselves to be willing to actually
internalize some cost to achieve change.
So the impasse group
never really had an effect,
but you can still see and we showed this
with (mumbles) and SodaStream
and some of the other
business interventions
that I have talked about that business,
individual business leaders,
if there's no capacity
to do things on a regime-level
scale can nonetheless be
thinking about ways of
changing things at the margin
so that even if this is parried
as legitimating the status quo,
it can be legitimating a status quo
that is itself evolving over time.
This was Douglas Ray's
idea of utility drift
that I talked to you about and could
put business in a position
to be a constructive force
when the other things
line up more propitiously.
We have ongoing projects looking
at this in other contexts.
We have a project looking
at this in Columbia
where various Colombian business groups,
I didn't have time to share this
with you during the lecture,
but I have for decades actually
been involved behind the scenes
in negotiations between various
Colombian governments and the FARC
and were instrumental in the agreement
that was eventually settled.
Unlike South African business
after the transition,
there are a number of interesting
Colombian business enterprises aimed
at trying to incorporate the FARC
into the new legitimate
economy and revivify
it in ways that will make backsliding
less likely.
By no means sure that they'll succeed,
but they perceive the possibility
for agency at the margin
and/or trying to do that.
One might think of Syria
where the Civil War
is going to be over in the next year.
There's a huge amount of
expatriate Syrian capital
parked in various countries
and convening groups may
well have the opportunity
of thinking about how it might
be constructively deployed
in rebuilding what's probably the most
badly devastated country by Civil War,
at least since Rwanda.
Business and domestic politics.
Here I would say
that the missed opportunity
with transitional adjustment assistance
is symptomatic of a bigger
sense that business has
not seen it as their problem to worry
about the fortunes of workers.
As I said to you in that lecture, in 1962,
the Kennedy administration,
it actually lined up the AFL-CIO
to support tariff reduction
as a quid for the quo being
transitional adjustment assistance.
By the time business finally
decided that was a good idea,
the unions had abandoned it
and were no longer supportive of it,
and that was because the
implementation by the
Johnson administration
had been so desultory,
but if business had gotten
behind that at the beginning
we might have seen something different.
Full-bore support for
the anti-tax movement
by American business from the beginning
even if this was gonna mean
destruction of many programs that are
important to the most
vulnerable populations.
We saw this with Proposition
13 in California,
and its effect on the
public school system,
its effects
on local government services and so on.
A new model of the corporation
became triumphant
in the late 1980s
where shareholder value triumphs
over everything else,
trumps everything else,
and the notion that business corporations
should worry about anything else.
If you look at the changes
in business school
curriculums, for example,
largely went out of the window.
That all adds up to the fact
that there was a failure to see
the costs of ignoring the long-term
employment insecurity of labor.
Andrew Wang's warning at the end
of the video that I showed you
that if these things are not addressed,
worse than Trump is likely to come along.
A final strategy
I would just mention
or set of a path not
taken I would mention is
the strategies of left
political parties at home.
- Here's the truth.
No politician can reopen this factory
or bring back the shipyard jobs
or make your union strong again.
No politician can make it
be the way it used to be
because we're living in a new world now,
a world without economic borders.
A guy can push a button in New York
and move a billion dollars
to Tokyo in a blink of an eye
and in that world muscle jobs
go where muscle labor is cheap
and that is not here.
So if you wanna compete,
you're gonna have to exercise
a different set of muscles,
the one between your ears.
- So that was from the
movie, "Primary Colors,"
and I showed you a more
extended version of that clip,
but there it is in 1992,
Bill Clinton nailing it,
exactly what the problem was going to be,
that the long-term employment
security that had been
taken for granted by
generations of American workers
had gone away and was not coming back,
but what did the Clinton
administration do about that?
Nothing.
Instead, what did they do?
They triangulated
to neoliberal policies.
They engaged in the expansion of NATO.
They got behind things like welfare reform
essentially to make it more punitive
and they cozy-ed up to Wall Street
by getting behind the kind
of financial deregulation that
Wall Street was demanding.
So the fact that even though
the candidate Clinton had
identified the problem,
he didn't
really take seriously the
effort to do anything about it.
Indeed in the class on the
subprime mortgage crisis
he became one of the
champions of getting mortgages
to people who are gonna
be unlikely to be able
to service them as soon
as the recession came.
So very much
he identified the problem
and the different do anything
of a serious time to address it
and he squandered whatever
political capital he had
in the first years of his administration
when he controlled all
the houses and so on.
And by the way, it wasn't just here.
We saw Tony Blair's government in the UK
did many comparable things.
Even in Germany,
I believe I mentioned to you,
if you look at the Hartz reforms
which were neoliberal reforms,
not that different than those pursued
by the Blair government, or
by the Clinton administration,
or indeed in countries even like France
where Mitterrand did an about turn,
who were the Hartz reforms implemented
by in the early years of this century?
It was a coalition of the
Social Democrats and the Greens.
It was not
a right-wing imposition.
So all of these parties were
essentially engaging in triangulation
instead of addressing the
long-term employment insecurity
that Bill Clinton did indeed identify
in the 1992 New Hampshire primary.
The difficulty with
triangulation as I've said
is that it's good
tactics, but bad strategy.
It's good tactics
because if you just think about it
as a one-shot game as game theorists say,
you can move to the middle,
peel off some support from your opponent
and the people on your
flank have no place to go.
But if you think about it
as a dynamic game over time,
once the other side figures out
that that's what you're doing,
their incentive is to just
keep moving the goal post
and dragging you along as they go.
This was the story of
the anti-tax movement
that culminated in the
2001 bill that I described
at some length in our
class about the estate tax.
Indeed the sort of tragic denouement
of that story was when in 2012
the Obama administration
made virtually all
of the 2001 tax cuts,
biggest regressive change
in the tax system in
American history permanent.
So this was
I think
a big missed opportunity
reinforced by this sort of
"living right and thinking left,"
to quote
the phrase
from the book that I mentioned to you
when I was giving that lecture
on things like affirmative action
and managing the financial crisis.
Affirmative action is about promotions
in the police department
and the fire department.
That's where the rubber meets the road.
Doesn't really affect
people living in Scarsdale.
In the financial crisis,
unlike what FDR had done
often the depression,
I showed you how the Obama administration
essentially got on board
with the Bush administration's
policies and allowed
the financial sector to
write the vast majority
of the bill and not to pay any cost
for the crisis that they had created
thereby fueling what would
eventually erupt as the kind
of enraged politics of anti-elitism
in 2016.
Given that they were converging
on questions of economic management,
instead what left-wing
parties tended to do
or left-of-center parties
tended to do was to begin
investing in culture and
identity issues as ways
of differentiating themselves
from the Republicans.
This goes back to the
McGovern-Fraser reforms which start
to emphasize the importance
of descriptive representation
in politics which I'll
have more to say shortly.
So what is to be done?
So the bottom line is,
and this is picking up on
the lecture about parties,
that the most important
thing that needs to happen
is to strengthen political parties
so that they can operate
more like teams and thereby
get themselves behind
the sorts of policies
that are gonna lead
large numbers of insecure
former or post industrial workers
and middle-class people to support them.
In all systems, all political systems,
that basically means a number of things.
One is disempower party
members and outside groups
in the selection of candidates,
leaders, and platform.
Members sound like
shareholders, but as we saw,
they tend to be unrepresentative
of the voters for a party,
particularly when you have a large party,
never mind the voters in the electorate.
Get away from referendums and
other forms of unbundling.
Parties are there to bundle.
We had a long lecture on bundling,
why bundling is important,
because it forces
us to discount what we want by
everything else that we want
and come up with policies that can appeal
to a broad swath of voters.
Empower backbenchers to pick frontbenchers
so the parties can operate
as teams in the parliament
and empower frontbenchers to pick
backbenchers for the same reason
so that the people who get
picked can both win electorally,
but will also support the program
that the leadership desires.
So you give a lot of
delegation to the leadership,
but they also have enough
rope to hang themselves.
If they can't deliver successes,
they won't be there for long.
In multiparty systems,
this means increased thresholds
to try and get parties to combine
so you combat the fragmentation
of parties that creates
huge opportunities for rent extraction
when people are needed to join coalitions.
Push for reelection coalitions so at least
voters have a better
idea of what governments
are likely to form after the election.
Prefer closed PR to open
list PR because open list PR
encourages celebrities to run.
It encourages people,
intraparty competition
to make private promises,
and that's exactly inimical to the idea
of parties operating as teams.
Turning to two-party systems, in Britain,
change the leadership selection rules back
to something more like they used to have
when the backbenchers
picked the frontbenchers
and got rid of them
if the frontbenchers were not delivering.
Get rid of the fixed parliaments act,
which again is a way of disempowering
the authority of leaders.
Bigger constituencies.
They a couple years ago had a commission
recommending that they reduce
the House of Commons from 650 to 600,
a very modest reduction.
They've even rejected that,
but one of the problems in Britain is
that all the wealth is in London
and many parts of the north of England
have per capita income below Mississippi.
You really want a sliver of London
in every constituency in Britain
if you want a healthier system
and certainly the constituencies
which are a tenth of the size of ours
and a third of the size
of Germany are too small.
Stop having referendums.
In the United States,
first of all don't think abolishing
the electoral college is
a solution to anything.
Everybody says, "It's so unfair.
"Hillary won three million more votes."
Abolishing the electoral college,
it will increase the independent
authority of the president.
It will make us function more
like a Latin American country.
That's exactly what we shouldn't be doing.
We should strengthening
the power of the parties
in Congress at the
expense of the presidency,
going back to something more like
what prevailed until 1824
when the congressional parties
pick the presidential candidates
and made the system operate
more like a parliamentary system.
Deemphasize the importance of primaries,
both Congressional and Presidential.
Presidential primaries
have really only been important
since the McGovern-Fraser
reforms of the 1971.
What people don't know about primaries
is the very low turnout.
So Donald Trump, for example,
was selected as the Republican candidate
by less than 5% of the
American electorate,
but then he's the candidate.
If there's a weak candidate
on the other side,
he might end up, as he
did, being the president.
So one proposal would be,
since most American voters don't realize
that primaries are so unrepresentative
and would be a proposal
whereby if the turnout
in a primary falls below some threshold,
such as 75% of the general election
turnout in the previous election,
then you discount the
primary and let the party
choose the candidate.
Similarly, if you think
about legislative elections,
primaries have been
around since progressives.
This is an example of a reform
dreamed up on a starry-eyed left
that has since been
hijacked by the steely-eyed
well-endowed forces
in other parts of the electorate as well.
You could have a similar kind of rule.
What we have is a world in which,
I should say the primaries
have been around for 120 years,
but what's changed is
the number of safe seats.
We have many more safe
seats than we used to have
which in unsafe seats the only election
that matters is the primary election.
Again so you can have
AOC elected in the 14th
district in New York
on a 11% turnout in a primary
or Jim Jordan elected
in Ohio's 4th district
on a 15% turnout in the primary.
Again you could have a rule
whereby if the turnout
in the primary fell below
some number or some threshold
that the party leadership
would have a say.
No jungle primaries.
This is a new flavor du
jour they put in California
where everybody runs in the primary.
The thought was it would produce
more moderate candidates.
In fact it doesn't because the,
even in jungle primaries,
it tends to be the activists
who turn out in the primaries.
For the Senate,
get behind plans to
admit DC and Puerto Rico
and proposals to split up
states like California and Texas
so that the massive
malapportionment in the center
could be redressed somewhat at the margin.
I'm talking here about things that could
be done without constitutional amendments
or without a new
constitutional convention.
House, in the House,
we should be redistricting
for interparty competitiveness
by reducing the number of safe seats
and the way to do this is
to change the redistricting.
The redistricting
historically has been done
by state legislatures,
and of course whoever controls
the state legislature does it
to maximize the benefit for their party.
Earlier this year,
the Supreme Court has decided
it will never get involved
in partisan gerrymandering.
It's too much of a political issue
and they don't know what to do about it.
So what happens is
the parties draw the districts
to benefit themselves.
So I think there now 21 states have gone
to so-called independent commissions.
This could be a good idea.
In Britain, for example,
they have an independent
commission after the
census that draws up boundaries,
boundary commission they call it,
and then parliament
can vote it up or down,
but they can't change it.
So that's one way of doing it.
The problem is, so we have now,
I think we have 14 in
operation since the 2010 census
and another seven which will be
operating after the 2020 census,
but if you look at them,
they're either so-called
bipartisan or nonpartisan.
The bipartisan ones are hopeless
in that the parties carve out the states.
They essentially make deals.
The nonpartisan ones,
the difficulty with them is that they're
not given the mandate to make districts
competitive across the parties.
Indeed they are told to do
things like not split up cities,
keep neighborhoods together and so on.
Really what you need and what would make
for the healthiest interparty competition
would be every district in
America having some urban voters,
some suburban voters and some rural voters
so that the politician who is running
for office in those districts would
discount the preferences
of all three groups
against one another in coming
up with their platform.
So for flower-petal districts,
you might think to achieve that goal,
and then we should think
about better approaches
to descriptive representation
because the trouble
with majority-minority districts is
you achieve,
they did indeed increase
the number of African-Americans
sent to Congress,
particularly from the South
where none had been sent
since Jim Crow in many cases,
but it comes at the price of
exactly what we don't want.
We do not want blue cities in red states.
We do not want
all the Democrats, African-Americans,
to be herded into one district,
and then have Republican
nonminority districts electing
separate representatives.
That is exactly what we don't want.
There are better ways to get
descriptive representation.
In some Nordic countries, for example,
with a PR system they just say, well,
every third person on
the list must be a woman,
or in India in 1932
there was the Poona Pact
which essentially it said in
a number of constituencies,
believe it was 143 constituencies,
the only person who could run
what was in those days
called an untouchable,
now is referred to as a member
of an unscheduled caste.
So you can get descriptive representation
without screwing up the
boundaries of the constituencies.
So these would be better ways
to get descriptive representation.
Majority-minority districts,
which now account for a fifth
of Congress' districts, are not.
So the upshot is that stronger
and more disciplined parties
will have better incentives
and will be better able
to address the long term
employment insecurity
that we've been talking about
and head off the dangerously
destructive politics
that we've seen since 2016,
or to put it differently,
what we should be trying to do is to marry
the arguments of these two books.
So I thank you for indulging me
over these previous 26 lectures
and I hope I'll see some
of you in the future.
(students clapping)
(instrumental music)
