The REAL Bush Doctrine     Daily News In Review

A Failure of Democracy, Not Capitalism

By BENJAMIN R. BARBER New York Times  7/29/2002

Congress passed sweeping legislation to reform corporate conduct and governance last week, and President Bush has pledged to sign it. A mere two months ago, the prospects for such broad reform were grim, as Congressional Republicans and the president himself favored a more limited approach.

The new law — among other reforms, it creates an independent oversight board for the accounting industry and curbs executive abuses like sweetheart loans — may appear to be the reassertion of the public will over private interests. But it fails to address the deeper scandal: the real cause of spreading corporate malfeasance in America is a lack of faith in democratic institutions themselves.

Politicians on both sides of the aisle long insisted the scandals could be traced to a few rotten apples in an otherwise healthy barrel; a few radicals worry that the barrel itself (the capitalist system) is rotten. But business malfeasance is the consequence neither of systemic capitalist contradictions nor private sin, which are endemic to capitalism and, indeed, to humanity. It arises from a failure of the instruments of democracy, which have been weakened by three decades of market fundamentalism, privatization ideology and resentment of government.

Capitalism is not too strong; democracy is too weak. We have not grown too hubristic as producers and consumers; we have grown too timid as citizens, acquiescing to deregulation and privatization (airlines, accounting firms, banks, media conglomerates, you name it) and a growing tyranny of money over politics.

The corrosive effects of this trend are visible not only on Wall Street. The Bush administration, which favors energy production over energy conservation, has engineered a reversal of a generation of progress on environmentalism that threatens to leave the Superfund program underfunded, air-quality standards compromised and global warming unchecked. These policies can be traced directly to that proud disdain for the public realm that is common to all market fundamentalists, Republican and Democratic alike. Such attitudes represent a penchant for a go-it-alone economics that undermines the social contract and turns corporate sins into virtues of the bottom line.

Even in foreign policy, where unilateralism and the repudiation of partnerships might suggest a muscular governmental policy, there is a tendency to treat the international sector as a Hobbesian "state of nature," anarchic and disorderly, where "force and fraud are cardinal virtues" and the life of men is "nasty, brutish and short."

The United States fails to see that the international treaties it won't sign, the criminal court it will not acknowledge and the United Nations system it does not adequately support are all efforts, however compromised, at developing a new global contract to contain the chaos. The American belittlement of these efforts betrays a strategy that enhances global anarchy in the name of preserving national sovereignty. Thus the new global disorder is as incapable of constraining global crime as the deregulated domestic market is incapable of containing corporate crime.

Market fundamentalism, which defined the era of Ronald Reagan and Margaret Thatcher, encourages a myth of omnipotent markets. But this is as foolish and wrong-headed as the myth of omnipotent states, which reigned from the New Deal to the Great Society. It tricks people into believing their own common power represents some bureaucrat's hegemony over them, and that buying power is the same as voting power. But consumers are not citizens, and markets cannot exercise democratic sovereignty.

The ascendant market ideology claims to free us, but it actually robs us of the civic freedom by which we control the social consequences of our private choices. We are unlikely to achieve a genuinely public and democratic plan for the World Trade Center site, for example, by polling the myriad private interests with a stake in the development of the site. Democracy is more than consumer polling. It demands the consideration not only of what individuals want (private choosing) but also of what society needs (public choosing).

The truth is that runaway capitalists, environmental know-nothings, irresponsible accountants, amoral drug runners and antimodern terrorists all flourish because we have diminished the power of the public sphere. By privatizing government functions and refusing to help create democratic institutions of global governance, America has relinquished its authority to control these forces. Within the United States, we foolishly think we possess a private liberty that allows us to work and prosper individually, not together or in conformity with a social contract. In the international realm, we seem to believe that our claim to national sovereignty allows us to operate unilaterally — America first and foremost, not together or in conformity with a global contract.

On Sept. 11, no one looked to Bill Gates or Michael Eisner, let alone Kenneth Lay or Martha Stewart, for national leadership. On that day Americans remembered the true meaning of words like citizen and public servant and relied upon firefighters, mayors, Congress and the president. Why then today do we expect corporate executives or "market professionals" to cure the disorders of anarchic market capitalism — which, as Theodore Roosevelt understood, responds only to democratic oversight? And how do we expect a go-it-alone superpower to depose terrorists who exploit the global interdependence America is reluctant to recognize?

These ends are public, the res publica that constitutes us as a common people. To secure them is the common task of every citizen — as well as the principal responsibility of the president and Congress, whose problem is not that they may have once been complicit in the vices of capitalism, but that they are today insufficiently complicit in the virtues of democracy.

Benjamin R. Barber is a professor of political philosophy at the University of Maryland and the author of ‘‘Jihad vs. McWorld.’’

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