Did Market Leninism Win the Cold War?
Cross-posted with TomDispatch.com
Imagine an alternative universe in which the two major Cold War superpowers evolved into the United Soviet Socialist States. The conjoined entity, linked perhaps by a new Bering Straits land bridge, combines the optimal features of capitalism and collectivism. From Siberia to Sioux City, we’d all be living in one giant Sweden.
It sounds like either the paranoid nightmare of a John Bircher or the wildly optimistic dream of Vermont socialist Bernie Sanders.
Back in the 1960s and 1970s, however, this was a rather conventional view, at least among influential thinkers like economist John Kenneth Galbraith who predicted that the United States and the Soviet Union would converge at some point in the future with the market tempered by planning and planning invigorated by the market. Like many an academic notion, it didn’t come to pass. The United States veered off in the direction of Reaganomics. And the Soviet Union eventually collapsed. So much for “convergence theory,” which like EST or cold fusion went the way of most crackpot ideas.
Or did it? Take another look at our world in 2015 and tell me if, somehow we haven’t backed our way through the looking glass into that very alternative universe -- with a twist. The planet currently seems to be on the cusp of a decidedly unharmonic convergence.
Consider what’s happening in Russia, where an elected autocrat presides over a free market shaped by a powerful state apparatus. Similarly, China’s mash-up of market Leninism offers a one-from-column-A-and-one-from-Column-B combination platter. Both countries are also rife with crime, corruption, growing inequality, and militarism. Think of them as the un-Swedens.
Nor do such hybrids live only in the East. Hungary, a member of the European Union and a key post-Communist adherent to liberalism, has been heading off in an altogether different direction since its ruling Fidesz party took over in 2010. Last July, its prime minister, Viktor Orban, declared that he no longer looks to the West for guidance. To survive in an ever more competitive global economy, Orban is seeking inspiration from various hybrid powers, the other un-Swedens of our planet: Turkey, Singapore, and both Russia and China. Touting the renationalization of former state assets and stricter controls on foreign investment, he has promised to remake Hungary into an “illiberal state” that both challenges laissez-faire principles and concentrates power in the leader and his party.
The United States is not exactly immune from such trends. The state has also become quite illiberal here as its reach and power have been expanded in striking ways. As it happens, however, America’s Gosplan, our state planning committee, comes with a different name: the military-industrial-homeland-security complex. Washington presides over a planet-spanning surveillance system that would have been the envy of the Communist apparatchiks of the previous century, even as it has imposed a global economic template on other countries that enables enormous corporate entities to elbow aside local competition. If the American tradition of liberalism and democracy was once all about “the little guy” -- the rights of the individual, the success of small business -- the United States has gone big in the worst possible way.
The convergence theorists imagined that the better aspects of capitalism and communism would emerge from the Darwinian competition of the Cold War and that the result would be a more adaptable and humane hybrid. It was a typically Panglossian error. Instead of the best of all possible worlds, the international community now faces an unholy trinity of authoritarian politics, cutthroat economics, and Big Brother surveillance. Even though we might all be eating off IKEA tableware, listening to Spotify, and reading the latest Girl With the Dragon Tattoo knock-off, we are not living in a giant Sweden. Our world is converging in a far more dystopian way. After two successive conservative governments and with a surging far-right party pounding its anti-immigrant drumbeat, even Sweden seems to be heading in the same dismal direction.
Indeed, if you squint at the history of the last 70 years, you might be persuaded to believe that the convergence theorists were right after all. For all the excitement the fall of the Berlin Wall generated and the paradigm shifts it inspired, the annus mirabilis of 1989 may not have been the end of one system and the victory of the other, but an odd interlude in a much longer evolution of the two.
Bats Do It, Whales Do It
Bats and whales don’t look at all alike. But they both operate in similarly dark environments. Bats hunt at night, while whales navigate the murk of the ocean. Because neither animal can rely on visual clues, they have developed the ability to echolocate, to use, that is, sound waves to find their way around. This clever strategy is an example of convergent evolution: adaptation by different creatures to similar environmental conditions.
Some social scientists in the Cold War period looked at Communism and capitalism in much the same way that evolutionary biologists view the bat and the whale. Both systems, while structurally different, were struggling to adapt to the same environmental factors. The forces of modernity -- of technological development, of growing bureaucratization -- would, it was then believed, push both systems in the same evolutionary direction. To achieve more optimal economic results, the Communists would increasingly rely on market mechanisms, while the capitalists would turn to planning. Democracy would take a backseat to bureaucracy as technocrats with no particular ideology ran the countries in both blocs in that now-distant two-superpower world. What would be lost in participation would be gained, it was claimed, in efficiency. The resulting hybrid structures, like echolocation, would represent the most effective ways to operate in a challenging global environment.
Convergence theory officially debuted in 1961 with a short but influential article by Jan Tinbergen. Communism and capitalism, the Dutch economist argued, would learn to overcome internal problems by borrowing from each other. More contact between the two foes would lead to a virtuous circle of more sharing and greater convergence. Further exposure came with John Kenneth Galbraith’s 1967 bestseller, The New Industrial State. From there, the concept spread beyond the economics profession and the transatlantic alliance. It even found adherents, among them nuclear physicist and dissident Andrei Sakharov in the Soviet Union.
In the 1970s, the coming of détente between the two superpowers suggested that these theorists had been on the mark. Policies emphasizing “coexistence,” adopted by each of the previously implacable enemies and facilitated by scientific exchanges and arms control treaties, seemed to herald a narrowing of differences. In the United States, even Republicans like Richard Nixon began to embrace wage and price controls in an effort to tame the market, while the rise of cybernetics suggested that computers might overcome the technical difficulties that socialist countries faced in creating efficient planned economies. In fact, with Project Cybersyn, an early 1970s effort to harness the power of semiconductors to regulate supply and demand, the government of Chile’s democratically elected socialist president Salvador Allende planned to usher in just such a technotopia.
Of course, Allende went down in a U.S.-backed military coup. Détente between the two superpowers collapsed in the late 1970s and, under the sway of Reaganism, American government officials began to dismantle the welfare state. At the same time, the Soviet Union, now headed by aged bureaucratic leaders like Leonid Brezhnev, sank into an economic funk before Mikhail Gorbachev made one last desperate, failed effort to preserve the system through a program of reforms. In 1991, the Soviet Union disappeared and the victory of rampant global capitalism was proclaimed.
Not surprisingly, in the early 1990s several scholars wrote epitaphs for what clearly seemed to be a conceptual dead end. Convergence was dead. Long live, well what?
The Short-Lived End of History
Even as convergence theory was bowing out ungracefully, political theorist Francis Fukuyama was reinventing the concept. In the summer of 1989, with his controversial essay “The End of History” in which he proclaimed the eternal triumph of liberal democracy (and the economic system that went with it), he anticipated the central question of the era: What would replace the ideological confrontation of the Cold War?
Several months before the fall of the Berlin Wall and the outbreak of the Velvet Revolution in Czechoslovakia, Fukuyama argued that Communism would no longer pose an alternative to liberal democracy and that the European Union, the “universal homogeneous state” of his philosophical mentor, Alexandre Kojève, would ultimately be victorious. The endpoint of global political and economic evolution, in other words, was once again a political bureaucracy and an economic welfare state patterned on European social democracy. For Fukuyama, the tea leaves were clear: convergence was back as the way of the future.
What would have thrilled the architects of European integration -- and the likes of Jan Tinbergen and John Kenneth Galbraith -- was, however, a grave disappointment for Fukuyama, who was already in a premature state of mourning for the heroism that epic confrontations inspired. The ideological conflict that had given shape to the Cold War and meaning to all those who fought in its political and military skirmishes would, he feared, be defused and diminished. All that might then be left would be polite exchanges over minor disagreements in a boardroom in Brussels. The end of history, indeed!
Soon enough, Fukuyama’s thesis, briefly hailed here as the endpoint of all speculation about our global fate, came up visibly short as other potent ideologies reemerged to challenge the generally liberal democratic ethos of the West. There were, as a start, the virulent strains of ethno-nationalism that tore Yugoslavia apart and continued to rage across the expanse of the former Soviet Union. Similarly, religious fundamentalism, especially Islamic extremism, challenged the hard power, the multicultural ethos, even the very existence of various secular states across the Middle East and Africa. And the row of Communist dominoes toppling eastward stopped at Mongolia. China, North Korea, Laos, and Vietnam at least nominally retained their governing ideologies and their single party structures.
At the same time, the European Union expanded, absorbing all of East-Central Europe (except for a couple of small Balkan states), even incorporating the Baltic countries from the former Soviet Union. Convergence, Fukuyama-style, came in the form of acceding to the requirements of EU membership, a lengthy process that reshaped the political, economic, and social structures of its eastern aspirants. The war in Yugoslavia eventually ended, and Europe seemed to have avoided a much deeper clash of civilizations. Even in Bosnia, the Orthodox, Muslim, and Catholic factions achieved a grudging modus operandi, though the country remains far from a well-functioning entity.
Fukuyama had, in fact, suggested a variant of convergence theory -- that it would take the form of absorption. In this more ruthless narrative of evolution, the blue whale survives as the largest leviathan of the deep, while the immense shark-like Megalodon disappears. The Soviet Union made its bid for the proletariat of the world to unite and push capitalism into extinction. It failed. Instead, the fall of the Berlin Wall and the reunification of Germany vindicated the capitalist theorists. So did the absorption of East-Central Europe into the European Union.
And once again, that was supposed to be the end of the story. The EU would be a diluted version of the Sweden that the original convergence theorists had posited -- generally peaceful, modestly prosperous, and passably democratic. The “common European home,” which Gorbachev invoked at the peak of his prestige, might one day even include Russia to the east and transatlantic partner America to the west.
Today, however, that common European home is on the verge of foreclosure. It’s not just that Russia is heading off in an entirely different direction or that the United States recoils from even the weak Scandinavian social democracy that the EU promulgates. Greece is contemplating what once was heresy, its own Grexit or departure from the Eurozone. More troubling, in the very heart of Europe in Budapest, Viktor Orban is turning his back on the West and facing East, while anti-EU, anti-immigrant right-wing parties are gaining adherents across the continent. A new axis of illiberalism might one day connect Beijing to Moscow, Hungary, and possibly beyond like a new trans-Siberian express. The vast Eurasian landmass, the historic pivot of geopolitics, is sinking into despotism with a corporate face and cosmetic democracy.
And Hungary is no European outlier, despite the EU’s censure of Orban’s authoritarian tendencies. Other leaders in the region, from the conservative Jaroslaw Kaczynski in Poland to the social democrat Robert Fico in Slovakia, look enviously at Orban’s model and his political success. Euroskepticism is spreading westward, with the far Right poised to take over in Denmark, the National Front capturing the most seats in the last European parliamentary elections in France, and the recently victorious Conservative Party in Great Britain planning to go ahead with a referendum on continued membership in the EU.
In other words, a geopolitical game of Go is underway. And just when you thought that the liberal pieces had spread successfully from the Atlantic to the western edge of Russia -- and under former Russian leader Boris Yeltsin possibly to the very shores of the Pacific -- the anti-liberals made a few key moves on the margins and the board began to shift in their favor. Croatia’s entrance into the EU in 2013 may well have been the high-water mark for that structure. An economic crisis in Greece, a political crisis in Great Britain, and a liberal crisis in Hungary could combine to unravel the most upbeat scenario for the recrudescence of convergence theory.
With the EU potentially on its way out, brace yourself for something considerably less anodyne.
The United States prides itself on being an exception to the rules, hence the endless emphasis by American political leaders of every stripe on the country’s “exceptionalism.” The U.S. remains the world’s only true superpower. It refuses to sign a range of international treaties. It reserves the right to invade other countries and even assassinate its own citizens if necessary. How could such a unique entity converge toward anything else?
These days, it’s usually just right-wing nuts who sound like old-fashioned convergence theorists. They’re the ones who label President Obama a secret agent of European socialism and believe that his health care plan will pollute the country’s precious bodily fluids, much as Dr. Strangelove’s General Jack D. Ripper worried about fluoridation. Despite the ornate fantasies of such figures, the United States has clearly moved in the opposite direction. Today’s Democrats are considerably more conservative economically than the Republicans of the 1970s and the Republicans have effectively purged all moderates from their ranks in their surge rightward.
Instead of converging toward Scandinavian socialism, the U.S. has been slouching toward illiberalism for some time now. The Tea Party bemoans the “nanny” and “gun-control” state, but misses the deeply sinister ways in which that state has been captured by the forces of illiberality. The United States has expanded its archipelago of incarceration, our homegrown gulag, so dramatically that we have more people in prison -- in total and by percentage of population -- than any developed country on Earth. Our political system has been taken over by a club of the rich -- our own nomenklatura -- with corruption so embedded that no one dares call it by that name and critics instead speak of the “revolving door” and “voter suppression” and the “influence of money in politics.” The deterioration of public infrastructure has, as in the Soviet Union in the 1970s, turned the country into an embarrassment of falling bridges, exploding gas lines, bursting pipelines, backward railroads, unsecured power plants, and potential ecological catastrophes.
Add in spreading governmental surveillance and secrecy, unsustainable military spending, and a disastrously interventionist, military-first foreign policy and the United States is looking a lot like either the old Soviet Union or the Russia of today. Neither is a flattering comparison. America has not yet descended into despotism, so the convergence is hardly complete. But it might be only one right-wing populist leader away from that worst-case scenario.
Where Does History End?
In the long sweep of history, development is not a one-way street that leads all traffic toward a single destination. No doubt the Romans in the first century AD and the Ottomans of the sixteenth century imagined that their glorious futures would be full of successful Caesars and sultans. They didn’t anticipate any great leaps backwards, much less the future collapse of each of their systems. Why should the EU or the American colossus be exempt from history’s serpentine ways?
And yet America consoles itself that what’s happening in Russia and China is only a temporary detour. Fukuyama might have been premature in his 1989 declaration of history’s end, but his historical determinism remains deeply imbedded in how Western liberal elites look at the world. They sit back and wait impatiently for countries to “come to their senses” and become “more like us.” They arrogantly expect convergence by absorption to proceed, if not tomorrow then eventually.
But if, in fact, the signs along the highway are not all pointing toward the same destination, then maybe we should stop checking our watches to see when North Korea will finally collapse, the Chinese Communist Party implode, and Putinism grind to a halt. These are not evolutionary dead-ends awaiting another political meteor, like the one in 1989, to strike the planet and wipe them out. For all we know, they might even outlive their Western challengers. The Chinese hybrid, for instance, seems no less stable at the moment than any liberal democracy, particularly now that its economy has surpassed that of the U.S. to become the largest in the world. Nor does Beijing appear to be intent on ending its one-party rule any time soon.
Convergence theorists expected that certain global trends, from technological innovation to economic development, would push different ideological systems toward a merger at some point in the future. They may well have been right about the mechanism, but wrong about the results. A different set of factors -- global financial crisis, widening economic inequality, increasingly scarce natural resources, anti-immigrant hysteria, persistent religious extremism, and widespread dissatisfaction with electoral democracy -- is pushing countries toward a considerably less harmonic kind of convergence. Forget about the “new industrial state.” Welcome to the new post-industrial despotism.
The ongoing convulsions of geopolitics are throwing up all manner of new hybrids. Many of these market authoritarian regimes are deeply troubling, the offspring of a marriage of the less savory aspects of collectivism and capitalism. But they are also potent reminders that, because we are not the slaves of history, we can transform our putatively triumphant liberalism, with all its manifold defects of corruption, inequality, and unsustainability, into something more optimal for both human beings and the planet. The bats did it, the whales did it, and even though it’s not inevitable, we humans can do it, too.
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