It's The Real News Network I'm Sharmini
Peries coming to you from Baltimore. The
concept of the liberal democracy is
generally based on capitalistic markets
along with respect for individual
freedoms and human rights and equality.
In the face of the law the ROI is a
financial capital and in its efforts to
deregulate financial markets however
raises the question where the liberal
democracy is a sustainable form of
government. Sooner or later
democratic institutions make way for
the interests of large capital to
supersede. Political economist John
weeks recently gave this year's a David
Gordon memorial lecture at the meeting
of the American Economic Association in
Philadelphia where he addressed these
issues with a talk titled "free markets
and the decline of democracy". Joining us
now is John Weeks he joins us from
London to discuss the issues raised in
his lecture you can find a link to this
lecture just below the player and John
is as you know professor emeritus of the
University of London School of Oriental
and African Studies and author of
economics of the 1% how mainstream
economics serves the rich obscure
reality and distorts policy. John good to
have you back on the Real News.Thank you
very much for having me. John let me 
start with your talk you talk, your talk  describes
a struggle between efforts to create a
democratic control over the economy and
the interest of capital which seeks to
subjugate government to the interest of,
to its own interests.So in your assessment
it looks like this is a losing battle
for democracy explained this further.  Yes
I think that Marx in Capital, in the first volume of Capital, refers to a concept called
blues were right by which he meant that
called bourgeois right, by which he meant, you said it in the introduction, 
that in a capitalist society
there is a formal equality that mimics
the relationship of exchange every
commodity looks equal in exchange and
when there is a system of ownership that
you might say is the shadow of that. I
think more important in the early stages
of development of capitalism of
development of factories that those
institutions those factories prompted
the growth of trade unions and workers
struggles in general. Those workers
struggles were key to the development
the further development of democracy
freedom of speech their whole range of
rights. The right to vote. However
with the development of finance capital
you've got quite a different dynamic
within the capitalist system and let me
said I don't want to romanticize the
earlier period of capitalism but you did
have struggles with mass struggles for
rights. Finance capital produces nothing
productive it doesn't do anything productive, nothing. So what's finance capital does is
basically is it redistributes the income
of the wealth the what Marx would call a
surplus value from other sectors of the
society to itself and it employs
relatively relatively few people so that
dynamic of the capital, industrial
capital generating its antithesis, namely
the labor movement,  doesn't occur on
under financial capital. In addition
financial capital leads to inequality,
as you've seen in
the United States and in Europe in many
other places,  it increases it increases
and and suddenly not suddenly but bit by
bit people begin to realize that they
aren't getting their share
and the that means that the government
the government to protect capitalism
must use force to maintain
the order of financial capital and I
think Trump is the fulfillment of that
and I think there are other examples to
which I can which I can go into. So
basically my argument is with the rise
of finance and it's unproductive
activities you get the decline in living
standards of the vast majority and in
order to maintain order in such a system
where people no longer think that
they're sort of getting their share and
so justice doesn't become a justice
beast and doesn't become the the reason
why people support the system
increasingly it has to be done through
force
alright John before we get further into
the relationship between new liberalism
and democracy give us a brief summary of
what you mean by neoliberalism you say
that it's not really about deregulation
as most people usually conceive of it if
that's not what it's about what is it
then I think that if you think about the
the movements in the United States and
as much as I can I will take examples
from the United States so the
Cosmosphere listeners will be familiar
with those beginning the other part of
the 20th century the in the United
States you have reform movements the the
breaking up of the large for Napoles
tobacco monopoly or a whole range of
Standard Oil all of that and then of
course under Roosevelt you began to get
the regulation of capital and in the
interest of the majority much of that
driven by Roosevelt's trade union
support so and so that was moving from a
system
Capital was relatively unregulated where
it was being regulated in the interests
of the vast majority and also would say
though I'm going to the tail to certain
extent he was in regulated in the
interest of capital itself to moderate
competition and therefore but they
ensure a relatively tranquil in market
environment
neoliberalism involves not the
deregulation of the capitalist system
but the regulation of it in the interest
of capital so it it involves moving from
a system in which capital is regulated
in the interest of stability and the
many to regulation in a way that
enhances capital so this in the
irregular these regulations get specific
about them restrictions on trade unions
as you have on real news a number of
people have talked about this the United
States now has many restrictions on the
organizing of trade unions which were
not present fifty or sixty years ago
making it harder to have a mass movement
of labor against capital other
restrictions on the right to demonstrate
a whole range of things and then within
capital itself the regulations on the
movement of capital that facilitate
speculation in international markets so
we have never ever capitalism which is
in which the form of regulation is
shifted from the regulation of capital
and the interest of Labor the regulation
of capital in the interest of capital
John give us a brief summary of the ways
in which neoliberalism undermines
democracy well I think
the many examples what I'm going to
focus on economic policy for an obvious
case is the role of the central bank in
the case of the United States Federal
Reserve System and in which I'm reducing
its accountability to the public one
where you wonder you can can do that is
by assigning goals to it with such as
fighting inflation which then override
other goals originally the Federal
Reserve System its charter or not saying
terms of reference if you want to use
that phrase in including a full
employment and stable economy the those
have been overwritten in more recent
legislation which great emphasis on the
control of inflation control inflation
basically means maintaining an economy
at a relatively high level of
unemployment or a real or part-time
employment in flexible flexible
employment for people are relatively few
rights at work and that the central bank
becomes a vehicle for enforcing a
neoliberal economic policy
second of all probably most of your
viewers will not remember the days when
we have a fixed exchange rates but they
had a world of fixed exchange rates in
those days that represents up in
representing the policy which government
could could use to affect its trade and
also infectious domestic policy they've
been deregulation of that we're now a
floating exchange rates that takes away
a enough to land the instrument of
economic policy and
policy there the here it's more ideology
than laws of their also laws there is a
law requiring that the government
balance its budget the which but more
important than that the introduction
into the public consciousness you know I
said much a grinding into the public
consciousness the idea that deficits are
about the in government debt is a bad
thing and that is that some completely
neoliberal ideology
so in summary well one way that the
democracy has been undermined is to take
away economic policy from the public
realm and move it to the realm of
experts so we have certain allegedly
expert guidelines that we have to follow
inflation should be low
we should not run deficits though the
national debt should be small these are
things that are just made up
ideologically there is no there is no
technical basis to them and so in doing
that you might say the term I like to
use is you you decommission the
democratic process in economic policy
John speaking of ideology in your talk
you refer to the challenge that fascism
posed or poses to neo liberal
democracies now it is interesting when
you take Europe into consideration and
nationalist socialist in Germany for
example appeal mostly to the working
class as does contemporary far-right
leaders in in Poland and Hungary that
they support more explicit near liberal
agendas why would people support a
neoliberal agenda that exasperate
inequalities and harm public services
that they depend on including jobs well
I think that to an extent in this
country specific but I can
first I'm talking about in Europe
because he raised the case in some
European countries and then I'll make
some comments about United States and
Trump if you want me to I think in
Europe a combination of three things
resulted in the rise of fascism and
authoritarian movements which are
verging on fascism one is that the
European integration project which let
me say that I have supported and I would
still prefer Britain not to leave the
European Union nevertheless the European
Union integration project has been a
project run by elites it has not been a
bottom-up process it has been a process
very much run by elite politicians in
which they get together I mean and in a
closed-door and they make policies which
say they subsequently announced many of
the decisions they come to being
extremely the meaning of them in
extremely opaque so therefore you had a
development in Europe of the European
Union which not from the bottom up but
very much from the top down you might
say just from the top I'm not sure how
much goes down that's one the second key
factor I would say for about 20 years in
European integration it was relatively
benign elitism because there was social
democratic it was at the sport of the
working class or the trade unions at any
rate that increasingly began to become
neoliberal so you have any neat project
which was turning into a neoliberal
project and specifically what I mean by
neoliberal is a where they're generating
flexibility rules for the labor market
austerity policies bank balance budgets
low inflation things that were talking
about before
and then the third element toxic the
most toxic of them but together the
relative is the legacy of fascism in
Europe every European country with the
exception of Britain had a substantial
fascist movement in the 1920's 1930's
England why Britain it's sometimes it
had to do with a particular class
struggle I mean class structure of
Britain so Poland
ironically enough was one of them it was
overrun by the Nazis and occupied and
incorporated into the German Reich
ironically it had a very right-wing
government when with a lot of sympathy
towards fascism when it was invaded in
the late summer of 1939 and the France
of strong fascist movement of course
Italy had a fascist government and the
other Hungary where now you have a
right-wing government of very strong
fascist movement subtleness and the
incorporation of these countries into
the Soviet sphere of influence Roman
Empire as it were did not destroy that
that fascism it certainly suppress it
but it didn't destroy it so as soon as
the European project began to transform
into a neoliberal project and the that
gathered strength in the early 1990s I
mean oh the neoliberal aspect of the
European Union and gathered strictly
early 1990s exactly when you are getting
the liberation of many countries from
Soviet rule and so when you put those
together
it was a rise of fascism waiting to
happen and now it is happening John
earlier you said you're factoring Trump
how does Trump fit into this phenomena I
think that as the real news is pointed
out that the many of Trump's policies
are appear just be more extreme versions
of things that George Bush did and in
some cases not that much different from
what Barack Obama did the other I
wouldn't go too deeply into that I think
that that is the most serious offenses
Obama would have been carried on by
Trump you have to do with the use of
drones and militants but in any way but
there's a big difference from Trump for
the most part the previous Republican
presidents and Democratic presidents
accepted the framework of the formal
framework of liberal democracy in the
United States it is formally accepted
the constraints imposed by the
Constitution now of course they probably
didn't do it out of the goodness of
their heart they get it because
definitely saw that the things that they
wanted to achieve the neoliberal goals
that they wanted to achieve were
perfectly consistent with aa the the
Constitution's frame marking guarantees
and rides and so on that none of most of
those rights a guaranteed in the way
that so weak that you that you didn't
have to repeal you know the of the first
10 amendments the Constitution in order
to have a repressive policies difference
with Trump is he has complete contempt
for all of those constraints as he is an
authoritarian I don't think he's a
fascist not yet but he is an
authoritarian he does not accept that
there are constraints which
respect their constraints has bother him
and he wants to get rid of them and he
actually takes steps to do so so what's
you having trouble I think is a sea
change you have a you know we had
right-wing presidents before certainly
difference trumpets he is a right-wing
president that sees no reason to to
respect the institutions of democratic
government I even you might say the
institution of representative government
I won't even use the term as strong as
Democratic that lays the basis for an
explicitly authoritarian United States
and I say that we're beginning to see
the vehicle by which this will occur the
restriction on Voting Rights course that
was going on before Trump nothing it
does in a more aggressive way and I
think the assume we will have a Supreme
Court that you have that will be quite
lenient with his tendency towards
authoritarian rule alright John
so let's end the segment with what can
be done I mean what must be done to
prevent neoliberal interest from
undermining democracy and who do you
believe is leading the struggle for
democracy now and what is the right
strategy that people should be fighting
for but one thing I think where I began
is that I think progressives as a real
news represents and Bernie Sanders and
all the people that support him and
Jeremy Corbyn over here I'll come back
to talk about a bit about Jeremy means
we must be explicit that we view
democracy by what you mean the
participation of people at the
grassroots their participation in the
government with you that
as a goal it's not merely a technique or
a tool which you know what was it that
Eragon so infamously said democracy is
like a train you take it the way you
want to go and then you get off no
progressive view is that democracy is
what it's all about democracy is the way
that we build present and we build a
future I'm quite fortunate and that I
live when perhaps the only large country
in the world where there's imminent
possibility of a progressive left-wing
anti-authoritarian government I think
that is the monumental importance of
Jeremy Corbyn and his his
second-in-command
John McDonald and others like Emily
Thornberry who is the foreign secretary
but these people are committed to
democracy in the United States Bernie
Sanders is committed to a democracy and
a lot of other people are to Elizabeth
Warren so I think that struggle in the
United States is extremely difficult
because of the role of the big money and
the media which you must know more about
than I do but it is a struggle which we
have to keep out and we have to be
optimistic about it
it's a good bit easier over here but as
we saw a new reported during the last
presidential election they forget it
came very close being president in the
United States and that I don't think was
a one-off event not to be repeated I
think it lays the basis for hope in the
future John thank you so much for
joining us and this has been a very
insightful discussion and I hope to
continue it as opportunities arise and
they think there's some interesting
developments in the UK with labour and
Germany Corbin's leadership and I think
people here in terms of our revolution
and followers of Bernie Sanders hasn't
really you know capped their revolution
yet it's an ongoing struggle as you say
there's some possibilities with Lopez
Obrador and Mexico leading in the polls
now leading up to their July elections
so there's many opportunities to discuss
this further and I hope you can join us
then I would very much like you thank
you and thank you for joining us here on
The Real News Network
