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Here come the liberals

For decades American conservatism defined global politics. Now we are about to witness a seismic cha

British politicians, commentators and the public like to believe in their sturdy autonomy. We have arrived at our decisions as freeborn men and women. We debate our ideas furiously in pubs, on radio phone-ins or via letters to the editor. We read the opinion pages. We elect a sovereign parliament that passes the laws and regulations that we mandate.

The truth is more subtle. We dance to another country's tune. It is the United States that makes the political, cultural and intellectual weather. It is the rich American institutes that develop the ideas for XYZ plan or ABC radical reform. Our academics, especially in the social sciences, want to get published in the American journals and ensure they please the editor in question. Our politicians watch closely to see what works in the US. We enjoy their movies and use their technology. The West Wing and Mad Men are part of our culture, as are Sex and the City and Friends. We think we are free; we are painfully and excessively influenced by the US.

Which is why the election of Barack Obama matters so much. In the tidal wave of tears of joy, analysis of county by county results, the "were you awake to hear the speech" conversations, naming the puppy and the critiques of Michelle's wardrobe - and yet another article on the big things in his in-tray - one thing has been underplayed. Obama's success will transform British politics. The centre ground will move significantly to the left.

No account of the rise of Thatcherism or the character of new Labour is possible without acknowledging the force and impact of the 30-year ascendancy of American neoconservatism. They won control of Washington in the late 1970s, creating the Washington consensus. No country - from communist China to the Nordic social democracies - held out. Everybody, to a degree, bought into the market fundamentalist consensus. Tony Blair could have held out more than he did - but the room for manoeuvre was tiny.

It went very deep. Editors of the top US social science journals published articles in this idiom because they had secured their jobs by conforming to it; ambitious British academics soon learned what was accepted and what was not. Young British investment bankers training in New York learned about the value of securitisation. Treasury officials on secondment to Washington bought into the consensus that privatisation and deregulation were the only ways forward. From social policy (remember zero tolerance and broken windows) to " light touch" financial regulation, and from a belief in labour market flexibility to distrust of public service broadcasting, the cultural and intellectual backdrop was conservative.

Obama's election ends that. American conservatism is now in profound disarray. It is not just that Republicanism has been forced back to the south and the mountain states: the intellectual paradigm that it championed led to nowhere but a credit crunch, a bloated and overpaid financial elite and the onset of a deep recession. No accident that Obama's lead jumped in the wake of the Lehman Brothers' bankruptcy and the part nationalisation of the banking system. Conservatism was on the ropes. A change had to come. Yes it did.

Here is a checklist of areas where the discourse is going to move left - intelligently and moderately because that is part of the Obama DNA. Firstly, trade unionism. Barack Obama shares the view of liberal Democrats that the best way to roll back the stagnating real incomes of the squeezed middle of the United States is to strengthen the bargaining power of organised labour. An empowered upper working class across all ethnic groups is the backbone of both the Democrat party and the economy.

This president is the most pro-union since Roosevelt. He wants to help unions organise and get recognition through a simple membership card check system, which workers can use freely and anonymously to signal their readiness to join - fiercely opposed by American business. This June, Obama even wrote to Tesco boss, Sir Terry Leahy, urging him to work with unions in the US (as he already does in the UK). The anti-unionism that led US officials to veto OECD reports that questioned labour market flexibility will be over. Now the US will encourage the OECD to publish evidence.

The BBC and Channel 4 should also be relieved at the victory. Obama is a strong supporter of public service broadcasting and caps on media ownership; he wants to see every American television and radio network commit to neutrality. In the US, one of the live issues is whether the Fairness Doctrine, requiring equal time between different points of view on broadcast media, should be reinstated - it was abolished by Ronald Reagan.

The subsequent avalanche of right-wing shock-jocks, the dumbing down of the American media and the partisanship of Fox News are even more an issue for the left in the US than the power of the right-wing print media is in Britain. For Democrats in the House, and Obama's chief of staff Rahm Emanuel, reinstating the Fairness Doctrine is of iconic importance. Obama may stop short of imposing a legal obligation on broadcasters - but he will go a long way towards it.

So it goes, too, with tax. This is the president who will redistribute income from the top 5 per cent earners above $200,000 to the other 95 per cent. There may not be much cash involved, but as Professor Avner Offer says in The Challenge of Affluence,, the point about higher tax rates is not so much the cash they raise but the signal they send about the dominant values of society. Obama has clear views on that. As he has on tax havens.

His reforms of Wall Street will be far-reaching; he will constrain bank bonuses, introduce tough new regulations and, as Roosevelt did, set up a wave of new banking institutions. He is already committed to a National Infrastructure Bank. When this is set up, financing roads, railways, bridges and dams across the US, the argument that Britain should have one too will become irresistible. Obama will try to deliver universal health provision. He will try to extend college access. He will want to build affordable homes. He will try radically to lower the US's carbon footprint, lower petrol consumption and improve energy efficiency. He will aim to reindustrialise the US.

As for foreign policy, he will be more multilateralist and there will be no Iraqs on his watch. But he is closer to Tony Blair and David Miliband (I think, rightly) as a liberal internationalist than many on the British left might like. Enlightenment values, democracy and human rights are worth asserting as universal rather than western principles. And, at the limit, worth fighting for. Trade is a big question mark. His party remains very protectionist.

For all that, the message is unmistakeable. Barack Obama will change the trajectory of the US.

I have found it odd to have been pro-BBC, pro-multilateralist Europe, pro-moderate trade unions, a City of London sceptic, pro-public service, pro-fairness and pro-redistribution for more years than I can remember. Now the leader of the world's hegemonic power, in control of its political, intellectual and cultural levers, is making this cluster of views the mainstream. The Labour Party and the wider liberal left are being given permission to be moderately and intelligently social democratic again. It may be a hackneyed phrase - but this really is a seminal moment.

Will Hutton is executive vice-chair of The Work Foundation

Obama's inner circle

Rahm Emanuel: chief of staff An Illinois congressman and the fourth-highest-ranking House Democrat. A centrist renowned for his aggressive manner, he is a former ballet dancer and was a volunteer mechanic in Israel's army during the first Gulf War in 1991. After working for the Clinton White House, he made $18m in two years at an investment bank. He is feared for his tactical prowess on Capitol Hill by Republicans and by Democrats who are not on his list of favourites.

Robert Gibbs: press secretary Gibbs has been with Obama since his 2004 Senate campaign, an affable Southerner with a temper. He was despatched on the trail in 2007 after concerns that Obama's message wasn't getting across; no adviser has spent more time at Obama's side. He made waves in a recent on-camera confrontation with Fox News's arch-conservative commentator Sean Hannity. Obama calls him "the guy I want in the foxhole with me during incoming fire".

Robert Gates The secretary of state for defence may hold on to his position in the short term to provide continuity in Iraq and Afghanistan. He has worked as a CIA chief and president of Texas A&M. He shares Obama's vision for emphasising "smart power" over raw military force, and keeping him on could lend a bipartisan aura.

Lawrence Summers Tipped for the position of treasury secretary, a post he held under Clinton, Summers is also a former World Bank chief economist and Harvard president. Intellectually, he is hugely respected, but his occasional tactlessness - notably his comments about women's aptitude for science - has earned him detractors.

Tom Daschle Tipped for a cabinet-level post, possibly secretary of state or health policy tsar, Daschle led the Senate for a decade before being voted out in 2004. His early support for Obama lent the candidate credibility, and his legislative know-how will be of use in driving the agenda.

David Axelrod A likely senior White House adviser, Obama's chief campaign strategist began his career as a reporter for the Chicago Tribune. He will be keeping his eye on Obama's 2012 re-election prospects, though probably with less of a hand in policy than Karl Rove had.

Valerie Jarrett A contender for a cabinet post, Jarrett is more likely to become a White House adviser. Co-chair of Obama's transition team, she is a businesswoman and a close friend of Barack and Michelle Obama.

This article first appeared in the 17 November 2008 issue of the New Statesman, Obamania

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The iron law of oligarchy

Donald Trump’s victory has changed politics irrevocably. The age of unchecked globalisation and armed missionaries for liberal values is over. And we are entering a new age of great-power rivalry.

The election of Donald Trump is the second act in a play that began on a smaller stage. The vote for Brexit was never a peculiarly British event, but it could be seen as such for as long as the abrupt dismissal of established elites that it involved was confined to a single country. Now, having demolished the dynastic order embodied in the Clinton and Bush families, Trump is bringing a changing of the guard to the most powerful country in the world. A profound shift that began in Britain has become an international movement. Democratic politics is in a revolutionary upheaval.

Having won out against the US media while deploying far smaller resources of money and organisation than those of his opponents in both parties, Trump is not going to be quietly assimilated into the elites he has dislodged from power. No doubt he will be constrained by American institutions. Though it will no longer be grid-locked, he will need the co-operation of the Republican-controlled Congress in some areas – if he goes ahead and withdraws from the Paris climate accords, for example – and elements of the old ruling groups will retain some capacity to curb him. Others will throw in their lot with the new regime. Lobby groups will be quick to form profitable links with Trump’s transitional team. Having no strategic plan, Trump himself may find it easier to modify existing policies – as he seems about to do with “Obamacare” – than scrap them altogether.

Inevitably, there will be many continuities in the pattern of government that develops. But the disruptive manner of Trump’s rise to power precludes his continuing with the policies that defined the regime he has overturned. He cannot avoid disrupting the order that has prevailed since the closing years of the Second World War. His world-changing impact will be magnified by political shocks in Europe, where the third act of the play seems poised to begin.

Trump’s victory has overturned the belief that an international order established over 70 years ago could persist and shape the future. In a worst-case scenario, Nato could be destroyed if the president-to-be reneges on America’s commitment to Article 5 of the organisation’s charter, first invoked following the 11 September 2001 attacks, which requires any member to defend any other that is under attack. The result would be an existential threat to the Baltic states, a problematic future for Poland, and enhanced Russian influence throughout the continent. If European countries show themselves ready to accept substantial increases in defence spending, this prospect might yet be avoided. Even so, there is no chance that the US will return to a global role of the kind it had before Trump was elected.

Maybe the international order that was built after the Second World War could have been renewed in some amended form if Western ruling elites had offered a more realistic response to the changing global landscape. Instead, they reacted to the end of the Cold War by creating an enemy in Russia, which paradoxically, during the early post-communist period, was one of the world’s most pro-Western countries. They imposed neoliberal dogmas of price decontrol and privatisation that impoverished much of the Russian population, ensuring that the difficult transition to a Western-style market economy was bound to fail. Then they proceeded to launch wars promoting regime change in the Middle East and, later, in Libya, which succeeded only in empowering jihadist forces and creating failed states from which flows of desperate migrants poured into Europe. Part of the popular revulsion against established elites comes from their record of serial incompetence. As for the elites themselves, they seem bewildered by what they have done.

A spin-off of their confusion has been a revival of conspiracy theory. While Julian Assange, holed up in his embassy bunker in London, assured the world that Trump would “not be allowed to win”, Hillary Clinton and her media legions were asserting that Trump was serving as the instrument of a foreign power. It would be rash to discount any Russian involvement in this dirty and murky US election. The function of conspiracy theories, however, is not to understand the world but to give sense to the lives of those who believe them. Paranoia is often a protest against powerlessness and a sense of insignificance. These symptoms are visible today in the liberal elites, which, against all their expectations, have been brusquely dismissed from power. In a post-election interview with Dutch television, Sidney Blumenthal, a long-time Clinton ally, described Trump’s victory as “a coup d’état”, orchestrated by “right-wing agents of the FBI”. Paranoid thinking of this kind shows a refusal to learn from experience.

The same is true of the blind moral panic that enables liberal elites to avoid facing up to their own role in their downfall. Those who talk of a triumph of racism and miso­gyny point to aspects of Trump’s campaign that were real enough. Yet it is impossible to imagine these familiar disorders propelling him to power without the decades of neglect and disdain displayed in both main parties for those Americans who have been consistent losers from globalisation. Liberal democracy cannot function when much of the middle class – along with the abandoned remnants of the working class – gains no perceptible benefit from economic growth. Real wages in the United States fell sharply during the global financial crisis, continued to decline for three years in a row, and then stagnated. Although median household income grew by a record 5.2 per cent year on year in 2015, as recently as September this year it was still 1.6 per cent lower than in 2007. Trump grasped this, and so did the Democratic insurgent Bernie Sanders. Liberals such as Hillary Clinton and her supporters continued to ignore it.

The economic policies that have so far emerged from Trump’s team are eclectic, featuring New Deal-like infrastructure spending, Reagan-style military Keynesianism involving a large increase in defence spending, and tax-cutting supply-side economics. If a programme along these lines is implemented it will amount to a huge stimulus and could spark a spectacular US economic boom. Whether it would bring back jobs and regenerate declining industries as Trump has promised is another matter. Fiscal stimulus on this scale risks inflation, rising interest rates and higher levels of US national debt. Full-scale protectionism may be less of a danger. Since Trump’s election, Mexico and Canada have intimated that they may be open to tweaking the provisions of the North American Free Trade Agreement. But, however calibrated, trade barriers of themselves cannot remove the threat to livelihoods that comes with new technologies, and neither will the wholesale deportation of illegal immigrants that Trump seems bent on implementing. The prospects for Trumponomics are cloudy.

The president-elect’s fuzzy economic programme is being used to support the claim that voters can no longer be trusted, by now a liberal commonplace. It is droll to see liberals adopting the language of Gustave Le Bon, the reactionary French critic of democracy whose 1895 study, The Crowd: a Study of the Popular Mind (long used as a bible by those who believe in the irrationality of voters), was one of the intellectual inspirations for European fascism. In fact, there was nothing irrational in voting for Trump even while having no strong belief that his policies would work. As I wrote here in September, unknown numbers of voters were “ready to roll the dice and opt for Trump, simply in order to impose change of some sort on the entrenched oligarchies and rigged political system that Clinton represents and embodies to them”.

These voters achieved their main goal, which was to inflict a powerful shock on the existing political classes. Clinton may have been aware that this section of the electorate posed a challenge she could not directly counter. So, unable to deny the part she had played in a generation-long social disaster, she chose to focus on prosecuting America’s culture wars. Leaving out those (such as working-class white women) who did not feature among the group identities she promoted, it was a strategy that left many feeling they belonged to an excluded majority. The hysteria that surrounds Trump’s victory stems in large part from a refusal by his opponents to admit their part in bringing it about.

 

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If Trump’s presidency inspires such horror in so many people, one reason is historical parochialism. There is dark talk of isolationism, and a rerun of the Smoot-Hawley Act 1930 that raised US tariffs, triggered a world trade war and supposedly precipitated the Great Depression; some see a revanchist Russia as a repeat of Nazi Germany. But the world we are entering is more like that of the late 19th century than that of the interwar years of the 20th, and in this regard as in others, Trump must count as a strikingly contemporary figure. Viewing relations between states in transactional terms of cost and benefit, he may be better suited to deal with 21st-century realities than the ideologues who preceded him.

The ideological clashes of the 1930s, which made an anachronistic reappearance in the neoconservative 1990s, have been displaced by old-fashioned geopolitical rivalries. No longer divided by contending secular belief systems, world politics is dominated by religion, nationalism, ethnicity and struggles over resources. At the same time, information war has moved to the centre of human conflict. Putin’s Russia is a modern authoritarian state equipped with hypermodern media technologies, which it uses to shape perception at home and abroad. It is this unequivocal modernity that makes it so hard for Western observers to understand Russia. Especially when they are ideological liberals, they cannot help seeing the country as an example of atavism and regression. This is dangerously complacent, because it implies that the Russian state will cease to be threatening if only the country can somehow be nudged back on to a more “normal” path of development.

Russia is abnormal only in ­embodying modern contradictions to an extreme degree. More autocratic than the Soviet state during most of its history, Putin’s dictatorship is also weaker and less predictable. Allowing greater freedom in private life than the Soviet Union ever did and more popularly legitimate than the Soviet state was in peacetime, Putin’s Russia is also more of a threat to its neighbours. Having renounced an ideology that promised to bury the West, Russia has a greater capacity to undo what remains of a liberal international order. There is no reason to think this would change if Vladimir Putin were to step down as president, as some reports about his health suggest he might. What if his successor is less intelligent, more volatile and more anti-Western?

It is too soon to talk of Trump having any fixed stance towards Russia. But there can be no doubt that, in this regard, the future will be quite different from the recent past. The shift could bring a more realistic view of dangers and opportunities. When she proposed a no-fly zone in Syria, Hillary Clinton forgot that a no-fly zone already exists, but it is Russian-operated. Western policies in Syria have left Putin able to veto any Western initiative that does not serve Russia’s strategic interests in the Middle East.

In any case, Western policies in Syria have never had realistic goals. When it pressed for the overthrow of Bashar al-Assad, the West did not consider the likely consequences: the collapse of the Syrian state, another jihadist-infested zone of anarchy and a larger influx of migrants into Europe. Several times during his campaign Trump proposed withdrawing US support for the Syrian rebels, many of whom are affiliated to jihadist groups, and adopting a scorched-earth policy towards Islamic State. Comments he has made since the election indicate that he is sticking with this view.

As was made clear in a provocative tweet last month by the Russian embassy in Washington, DC comparing the destruction of Grozny 16 years ago with the bombing campaign in Aleppo, and celebrating “the peaceful, modern and thriving city” that the Chechen capital has become, Putin does not share the belief that there is no military solution to terrorism. Trump’s joining with Russia in imposing such a solution on Syria would not be isolationism. But it would mark a major reversal in US policies and could lead to a breach with Britain, which seems still wedded to regime change.

 

 

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Beyond the Middle East, Trump has to decide how to approach China. Confident predictions of confrontation may be wide of the mark. Given that China is the only global power that has consistently implemented a rationalist foreign policy – in other words, one with clearly defined and achievable goals – its leaders may be inclined to approach Trump in the pragmatic, deal-making spirit that he invites. So far, they seem to view his demands for high trade barriers against Chinese exports as campaign rhetoric.

In Europe, the impact of Trump’s election can only be to accelerate disintegration. Contrary to any who imagine that a more detached US attitude to the continent will spur the European project to new heights, political momentum is driving a process of rapid balkanisation. Trump’s success in effectively bypassing the US party system demonstrates to Europe’s disaffected voters that they, too, have the ability to turn politics upside down. As a result of her misjudged and inept handling of the migrant crisis, Angela Merkel may well be gone after the German federal elections next September. Opening the next act of the insurgency against entrenched doctrinal liberalism, Trump’s victory will boost the fortunes of fringe parties in many European countries.

Attention will be focused on Italy, where a constitutional referendum called by Prime Minster Matteo Renzi for 4 December could strengthen Beppe Grillo’s Five Star Movement, which is pressing for a referendum on Italian membership of the eurozone. In the Netherlands, parliamentary elections on 15 March next year could bring Geert Wilders’s far-right Partij voor de Vrijheid nearer to forming a coalition government. On the same day as the Italian referendum there will be a rerun of the cancelled second round of Austria’s presidential election, which could produce the first far-right European head of state since the Second World War. Norbert Hofer of the Freiheitliche Partei Österreichs (Freedom Party of Austria) has proposed setting up a union of central European nations that would enforce a policy on migrants independent from the one mandated in Brussels.

In May 2017, Marine Le Pen could come within spitting distance of the Élysée Palace in the run-off of the French presidential election. (For whatever comfort it may give, experts have predicted that she would be defeated in a second round.) Faced with these political landmines, financial markets could decide that the euro – which has been stronger in recent weeks – is the next big short. Any one of these events could pose a life-threatening risk to the EU.

For the UK, Trump’s election points to a clean break with the EU. All the wrangling about hard and soft Brexit is history. A few years from now, the sacrosanct single market may have been altered beyond recognition, or may no longer exist. Whether the high court’s judgment is upheld or overturned on appeal, its challenge to invoking Article 50 without parliamentary consent is a speck of froth in an unstoppable torrent. British withdrawal from European jurisdiction is the inexorable logic of events.

The referendum on the terms of Brexit that is being touted by the Liberal Democrats’ leader, Tim Farron, will not happen. If a determined attempt is made in the Commons to block the government triggering Article 50 or to attach conditions to this, the result will be a vote of confidence and a general election. It is unlikely that Labour will support any such move. As long as Labour remains the anti-capitalist protest movement that Jeremy Corbyn has built, it faces electoral meltdown. Moreover, MPs with large pro-Brexit majorities, such as Ed Miliband, will not want the job of explaining to their constituents why their express wishes are being ignored and overridden. If an election does have to be called, the Conservative majority is likely to increase fivefold or even more. Remainers – not least Conservative relics of the Cameron era – will be left marginalised and powerless.

In the Scottish National Party – the biggest loser from Brexit aside from Ukip, even before the US election – First Minister Nicola Sturgeon will soon be forced to put up or shut up with her demand for another referendum on Scottish independence. With the EU rocked by after-tremors from the Trump earthquake, the single currency vulnerable, Europe’s banks fragile, and with European leaders vetoing negotiations with the Scottish government for fear of their own separatist movements, how many Scottish voters will opt to cut themselves adrift from the UK? It might be argued that most Scottish voters will choose national independence over economic self-interest. Yet that is not how politics is working in this age of insurgency. In the election for the US presidency, economic deprivation and despair trumped the politics of gender, culture and race; in the case of Brexit, voters who opted for Leave did not fear economic disaster. If Scotland leaves the UK, on the other hand, it will be a proper leap into the dark. In these conditions, the risk to the Union is minimal. Incessantly attacked as archaic and obsolete, the British state will remain in place for the foreseeable future.

A Britain that has removed itself from EU jurisdiction need not be less involved in Europe. Despite its depleted defence capacities – a legacy, like anarchy in Libya, of David Cameron’s strategic mastery – the UK continues to be a leading military power. Acting together with European nation states, Britain could build a counterweight to expanding Russian influence on the continent. With world trade arrangements in flux, there is also an opportunity to forge new economic relations with the United States. Dickering with a paralysed and dying EU may not be the most productive way in which to spend the two years once Brexit has been set in motion.

 

 

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In some ways the new world we have entered is not as novel as it looks. In reducing its global role, the US is returning to the more historically normal position it held in the 19th century as one of several great powers. Donald Trump’s domestic regime may also turn out to be more familiar than most expect. The family-influenced transition group that is assembling the new regime suggests an attempt to found a new dynasty to replace the ones he has overthrown. An iron law of oligarchy may already have begun to operate, allowing a new ruling group to redivide the spoils of office.

But Trump’s victory has changed world politics irrevocably. The age of unchecked globalisation and armed missionaries for liberal values is over. A little cool reflection might be useful in the circumstances. Liberals who wail and rage at the passing of the old order show little interest in realistic thinking and resolutely resist what it demonstrates. What many seem to want, at ­bottom, is to relieve themselves of the need to understand the world by shedding the burden of power. If so, they are on the right side of history.

John Gray’s latest book is the new and enlarged edition of “Gray’s Anatomy: Selected Writings” (Penguin)

John Gray is the New Statesman’s lead book reviewer. His latest book is The Soul of the Marionette: A Short Enquiry into Human Freedom.

This article first appeared in the 17 November 2016 issue of the New Statesman, Trump world