Voting with your wallet. After a huge propaganda campaign, the stock market is now seen as noble and democratic in its promise of riches for everyone. Naomi Klein on the myth of the People's Market

One Market Under God

Thomas Frank <em>Secker and Warburg, 425pp, £18.99</em>

ISBN 0436276194

How did investment become a hobby for little old ladies in the American Midwest, rivalling even bingo? How did stock tickers become more ubiquitous on television than weather forecasts? And whose idea was it to market day trading as an extreme sport - something you would want to do on your PalmPilot from a mountaintop in the Himalayas?

One Market Under God is the story of the mass-marketing of the market. Thomas Frank, one of America's most scathing cultural critics, argues that the market is no longer seen simply as a way to get rich, but as a much nobler entity: a quasi-socialist income redistribution scheme and an infinitely responsive, never-ending town-hall meeting. For many Americans, the market has become the primary political sphere, obscuring all others - from unions to community organising to politics itself. Likes and dislikes, approval and disapproval, protests and endorsements: all are now expressed almost exclusively by "voting with your wallet".

This book is about a powerful consensus - suffocating in America, and almost as dominant in Britain - which holds that the interests of the market are indistinguishable from the interests of the public. What's good for the Dow is good for society, even if stock prices are buoyed by the formation of a new cartel that will erode consumer choice, and even if the market celebrates fresh statistics about stagnant wages in the middle of an economic boom. Frank calls this conflation of capitalism with the public will "market populism", and sets out to answer a deceptively simple question: how did the market become us?

His thesis is that the stock market became the voice of the people through a process of mock-revolution. According to the script of this alleged revolt - as pieced together by Frank from management seminars, advertisements for online trading, articles in Wired magazine, and zany business books - the proletariat has, in under a decade, overthrown the pinstriped corporate suits who used to control all the money. This revolution was fought not by anti- capitalism protesters, but by "regular people" who oppose "elitism" in the capitalist class. And the happy results are already in: we now have democratic capitalism, a stronger and more pervasive role for the market than ever before. Frank calls it the "People's Market", after that other great icon of faux populism, the People's Princess.

In Frank's telling, the pseudo revolution has been waged on many fronts. Much of it has involved simply recasting the market, so that it is no longer a world of old white guys in suits and is now willing to accommodate, and indeed celebrate, infinite diversity. The face of business, as seen in ads on CNN and CNBC, is multiracial, casual, cool and, above all, young. More than that, the face of business has been remade to be actively anti-business, contemptuous of all that came before, and determined to break with every tradition.

The overwhelming message of the past decade was that riches were no longer for the rich only; they were for everyone. Better still, getting rich was easy: 15-year-olds were doing it messing around on their laptops; your next-door neighbour did it by reading mass-market self-help books; and semi-literate people did it by polling the audience on Who Wants to Be a Millionaire?. As Frank documents, the task of market populism was not to make everybody rich, but to convince a majority of people that they were about to become very rich.

The more often these stories were told, however unrepresentative they were, the more people decided to try their luck on the stock market (last year, 49 per cent of US citizens owned stock). This was cast not as a measure of Americans' loss of faith in social security and pensions, but as a populist victory for "Main Street USA"; "regular people" - a staple in mutual fund ads - were getting a piece of the big city action. For Generation X, meanwhile, investing wasn't pitched as ordinary, but extraordinary: rather than trusting their future to stuffy brokerage firms, they were - remarkably! daringly! - going at it by DIY, cutting out the middleman and trading their stocks online. According to magazines such as Fast Company and Business 2.0, investing wasn't buying into the system; it was cashing out, a way to get rich without ever having to work for The Man.

At which point, the populist spiral became self-fulfilling: the more people who owned stocks, the more plausible it was to argue that the market was democratic, a supreme form of self- government. "Markets were not merely organs of exchange," Frank writes; "they were a never-ending election . . . a combination voting booth and prosperity machine for the common man."

Add to that the influence of e-commerce and you have a regular coup d'etat. Thanks to new technologies, goes this flattering fairy tale, there now exists a race of "super-empowered indi- viduals", a "digital generation" who have multinational corporations quaking at their every click. These people don't wait for companies to give them what they want; they demand it from eBay and Video-on-Demand. The new consumers are not spectators, but participants, writes Frank, with the sarcasm that will be familiar to readers of his journal, the Baffler; they are not buyers, but de facto producers. Just as the stock market has been recast as a voting booth, the online shopping mall has become a site of popular control, with regular people in the driver's seat once again.

All of this populist rhetoric has had a profound effect not just on economics, but on politics, too. Because market populism has us voting with our dollars many times a day, when (and if) we get around to voting with our ballot papers, it has tended, at least in the US, to be for candidates promising to give our money back to us. This, too, was cast as a triumph of the little people: the more money left in our pockets, the more we have to spend expressing our true will in the market place. According to this theory, to interfere in the people's market - with taxation, government regulation, union organising - is to be a terrible elitist, scornful of "the people" and their choices. Meanwhile, politi- cians who place a Zen-like trust in the market enact a kind of laissez-faire participatory democracy.

As if the internet and day trading weren't enough to prove that the market had an umbilical connection to our souls, along came "branding". Suddenly, corporations weren't just selling products and image, they were selling democracy, community, empowerment. "The brand, in short, was us," Frank writes. And if we ever started to think otherwise, we were pulled back into the fold with more populist folk stories. Come now, said the brand managers, gather round the corporate campfire and hear the one about how the Nike empire was started by a couple of guys selling shoes from the back of their car. Or about how Bill Gates used not to get any respect from the suits.

Frank's argument is an important contribution to the discussion about how to rein in corporate power; many anti-corporate critics argue in favour of public-interest regulation on the grounds that corporations are accountable only to their shareholders, rather than to the public at large. One Market Under God documents a huge - and extraordinarily successful - propaganda campaign that has taught millions of people to stop thinking of themselves as citizens, and even as workers, and to begin thinking of themselves primarily as shareholders.

This idea of collective ownership is an illusion. As "the people" were storming Wall Street, their jobs were being casualised and wealth was being concentrated into fewer and fewer hands, an upward transfer of prosperity that Frank describes as "a gigantic heave-ho". This is not new information, but Frank's analysis of market populism helps explain how a huge PR campaign touting our fantastic empowerment and imminent riches made these disparities socially acceptable.

What is not clear is how long this illusion can hold. One Market Under God is the anatomy of a boom, and of the tulip-mania that always accompanies such economic moments. But how deep does the mass identification with the interests of the market run? It is easy to love the market in good times, but what happens when things go bad, as now seems rather likely? There are some signs of an imminent disassociation. In his inaugural speech, George W Bush felt the need to urge Americans to seek "a common good beyond your comfort" - a shocking admission that the pursuit of our individual comforts is not itself the creation of the common good. Still, the only heartfelt applause came when he said those two magic words: "tax cuts".

Naomi Klein's No Logo is published by Flamingo (£8.99)

Naomi Klein, the author of “The Shock Doctrine” and “No Logo”, is working on a book and a film about the revolutionary power of climate change. You can follow her on twitter @naomiaklein

This article first appeared in the 05 February 2001 issue of the New Statesman, Laughing all the way to No 10?