Friday, November 11, 2011

Hunger Chancellor

Italy and Greece are set 
to replace elected leaders with respected, veteran officials known for their expertise rather than their political skills
 in order to enforce more austerity, which is now the neoliberal orthodoxy, despite the fact that it makes no sense.

It seems to me that Bruening's failure at the end of Weimar was less a failure of technocratisme as such but rather the limitations of technocratisme in a time crises, which undermine political legitimacy more generally. In the case of Weimar the Negative Majority created a situation in which governmental action was impossible. Increased reliance on unelected technocrats to resolve the serious economic problems through a doctrinaire neoliberalism will be a disaster. Why? The neoliberal global economy didn't fail because of some exogenous shocks combined with inflation; it failed because unregulated profit-maximization leads to this state of affairs.

1) Fewer people have more money and need to get some kind of a return on that money
2) They all begin investing in the same set of things
3) The "value" of those things rises
4) The Bubble Emerges
5) Nonregulation lets the bubble grow
5) The bubble bursts
6) Socialize the Losses

If you could get rid of 6, the problem of the bursted bubble would be the loss of some small number of rentiers' incomes.  But because of 1, the politics are such that 6 has to happen.

So if our technocrats are going to succeed, they are going to have to overcome 1 and 6, which at this stage of the game means abandoning neoliberalism and the notion of the market state. This strikes me as unlikely and, as a consequence, we might find the European periphery at the least in a crisis of political legitimacy that could end in a more democratic, which is to say authentically social democratic moment. Or not.

The point is if they are really technocrats and not zombie ideologues, they will realize that the failure to create a climate of democratic legitimacy will fatally undermine their attempt to "fix" the mess in which those seeking profit maximization led the world. This means, doesn't it?, either some kind of pr campaign explaining why austerity is necessary or shifting their preferred policies to a mix of austerity combined with tax increases in order to preserve public employment and/or public services.

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