Sunday, November 26, 2006
For the 'anti-totalitarian' movement, the idea of developing a strong civil society rooted in rights discourse in opposition to the centralised state and big business, was crucial. Civil society would be a space for different publics to compete and collaborate, and would develop a network of institutions capable of exerting democratic pressures against potentially tyrannical powers. People would be protected from the worst of market society by a strong welfare state. Civil society would overcome the atomisation essential to 'totalitarian' state control. This was the rallying cry of people like Ralph Dahrendorf (himself a student of Karl Popper) and Timothy Garton Ash, at the same time as most of the institutions of the public life that represented democratic pressures (trade unions, liberal academia, the health service, welfare, local authorities) were under attack in the West under the rubric of neoliberalism. Social atomisation and the diminution of democratic counter-pressures was one indubitable result. Still, the collapse of the Stalinist states, it was hoped, would lead to the embedding of precisely this arrangement of affairs in all those societies.
But although the shedding of 'communism' was not a popular call for the introduction of capitalism (note here that when I talk about capitalism, I refer specifically to the usual version in which the capitalist class is formally independent of the state), particularly not in its neoliberal version, Jeffrey Sachs and the other pioneers of "shock therapy" were bullish: Sachs specifically rebuked Dahrendorf for endorsing open experimentation rather than capitalism, and proceeded with a process of social engineering whose ideology and subsequent materialisation merits some examination. Peter Gowan has performed this task admirably on numerous occasions, but you have to pay for those.
While people like Dahrendorf endorsed a kind of Millian liberalism, in which an economic system could be elaborated out of the free interplay of actors in a liberal society, Michael Ignatieff was quite explicit that 'civil society' had triumphed already and capitalist social relations had to be enforced through the power of the magistrate. Indeed, for Ignatieff, the principal use of the concept of civil society was as a counter to a potential "authoritarian populism". For this reason, while strong states were to be encouraged, the West should fund 'independent media' (he missed the contradiction there) and maintain ties with the opposition and every branch of the state, in order to encourage "the refusal to privilege public goals over private ones" as well as "the insistence that liberty can only have a negative rather than a positive content". In other words, this student of Isaiah Berlin would insist that states should be uncompromisingly authoritarian in suppressing popular tendencies to seek "positive" liberties, such as the right to eat nutritious food and drink safe water.
Sachs didn't see the need for such crude measures direct bribery and so on. He instead argued that "There is real truth in the marxist label for liberal democracy: 'bourgeois democracy'." A bourgeoisie had to be engineered. Similarly, Western policy had to be so designed that the highly weakened states of the CIS and Eastern Europe would embrace the development of robust capitalist institutions. For this purpose, the Comecon region had to be broken up, and the development of a new capitalist legal structure was to be made the condition for normalising relations with Western states, using economic incentives and sympathetic governments to force these changes through. There was to be fully open trade, full currency convertibility, corporate ownership as the dominant organisational form, and membership of key global institutions such as GATT, the IMF and the World Bank. The West had tremendous bargaining power in all this: "the capacity to open or close their markets to East European products; to decide on debt, on grant aid, on loans, and on the terms for loans for political as well as economic purposes, on technology transfers, on currency support and so on; to decide on entry or exclusion from international institutions; to allow Eastern workers to flow westwards." The beauty of this formula was that the more states accepted such goals as a result of the exertion of Western power, the more the power of Western states over them was augmented.
This involved Western states in alliances with segments of the new elites (often remnants of the old nomenklatura) in order to suppress popular pressures. In Poland, for instance, the worker-based syndicalist element of Solidarnosc demanded the strengthening of self-management arrangements over state enterprises, rather than their being handed over to corporations. The neoliberals in government instead pursued the centralisation of power in the hands of state agencies, and imposed tough wage controls on the public sector, which were not imposed on the private sector, thus producing a demand among workers for privatisation. This is how people like Sachs do it: by the arrangement of legal structures with appropriate incentives and penalties to engineer the desired outcomes. One of his more notable arguments for opposing workers' control was that international investors wouldn't trust them, itself an appeal to the automatic wielding of power by the owners of capital, rather than legal repression. On the other hand, this had to involve the suppression of any form popular resistance, even in the diffused form of the Russian parliament's reversal of its approval for shock therapy. The Economist called for Yeltsin to overthrow the new constitutional state in which he had been able to be elected, and this he did some five months later, to general applause.
The results? Well, on 2nd January 1992, ‘shock therapy’ in Russia began in earnest. The shock came in two ways – first, the price explosion (food suddenly cost four times what it used to), and second, the massive public expenditure cut-backs. Inflation did drop – from almost 250% in January 1992 to approximately 30% in December 1992. Progress indeed. By 1995, it was estimated that 80% of Russians had suffered a serious decline in their income. Income from work for families had dropped from being about half of all income at the start of the 1990s to just 39% in 2000. From a mortality rate of 11 per thousand in 1990, the death rate soared to 15 per thousand in 2000, peaking in 1994 at almost 16 per thousand. In fact, in this “unprecedented peace time mortality”, we find an alarming underlying truth about Russian society. Between 1990 and 1999, there were 3,353,000 excess deaths in the whole Russian territory. Male life expectancy fell from 63.5 years in 1991 to 57.6 years in 1994. Female life expectancy fell from 74.3 years in 1991 to 71.2 years in 1994. (Michael Haynes and Rumy Hasan, A Century of State Murder? Death and Policy in Twentieth Century Russia, Pluto Press, 2003).
The creation of 'civil society' did not democratise the state or allow for free and open experimentation. Rather, it ended up enriching those who were best placed to benefit, usually ex-nomenklatura, and institutionalised a form of private tyranny underwritten by the state. This is what civil society is in essence: in Adam Ferguson's formulation, it is a "commercial state", in which alternative forms of social life, such as the commons and communal life are suppressed.