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Capitalism facilitates but doesn’t ensure freedom

by Pankaj Mishra

Bloomberg

The 25th anniversary of the protests in Tiananmen Square on June 4 passed largely unnoticed in China. This dismal indifference to an awful atrocity should be blamed as much on a rising, self-absorbed middle class as state censorship. But this wasn’t the only sobering recent news for those of us who prize individual liberty and the political methods, popular participation in government, best equipped to secure it. Democratic experiments in Thailand and Egypt have collapsed. Their middle classes now openly back military despots of the kind — arrogant, ruthless and preposterously vain — last witnessed in the 1980s.

Among financial and political elites globally, there seems to be a disconcertingly broad consensus that, as an Egyptian analyst told the Financial Times, “pluralism is divisive, of no value and a loss of resources and that what we need is someone resolute enough to identify the public good and implement it.”

“Rule us, rule us hard, rule us ruthlessly,” a well-known investor exhorted India’s new prime minister in the country’s leading business daily the Economic Times. “But for Lord Ram’s sake, give us real growth, and income. The means don’t matter. We just want happy endings.” Even the Economist claims that “China’s leaders have been able to tackle some of the big problems of state-building that can take decades to deal with in a democracy.”

The widespread craving for such efficacious boosters of gross domestic product as Deng Xiaoping, Suharto and General Augusto Pinochet wasn’t the happy ending many commentators envisaged to the collapse of communism in Eastern Europe in 1989. In a recent article in the Wall Street Journal, Francis Fukuyama admitted that his influential idea that history could “culminate in liberty” was up for re-examination.

It’s true that economic growth through industrialization altered the social structure of societies and created demand for political representation. But it’s now clear that the process has also led to the opposite of liberal democracy.

Fukuyama disarmingly confesses that he didn’t pay enough attention to “the intertwining of politics and economics” or the fact that extreme poverty and social polarization can thwart the building of institutions needed for economic growth. Also, technology has proven to be “fickle in distributing its benefits.”

To be fair to Fukuyama, the contradictory trends of globalization — stunning prosperity accompanied by widening gaps in income and opportunity — were not obvious in 1989. Still, a few illusion-free thinkers had anticipated even earlier the challenge of building and sustaining liberal democracy against the chaotic backdrop of uneven growth, rising inequality and social unrest.

The most distinguished among this small group was Raymond Aron. Defiantly anti-communist in an age when many prominent French intellectuals revered the Soviet Union and Mao Zedong’s China, Aron saw free markets and industrial capitalism as indispensable to the establishing of a free and fair society. Together, they not only created wealth, but they also — especially in countries burdened by entrenched hierarchies — created the conditions for reducing social and economic inequality and extending opportunity to previously deprived peoples.

At the same time, Aron understood, long before the halcyon days of outsourcing, shareholder value and extravagant bonuses, that industrialization created its own hierarchies. People are rewarded unequally for their services. Moreover, demands for greater economic equality grow much faster than the means of fulfilling them.

Aron diagnosed an even deeper problem in the non-West, which faced simultaneously the arduous tasks of building strong nation-states and industrial economies while satisfying the democratic aspirations of newly politicized peoples. Nowhere in Europe, he wrote in “The Opium of Intellectuals,” “during the long years when industrial populations were growing rapidly, factory chimneys looming up over the suburbs and railways and bridges being constructed, were personal liberties, universal suffrage and the parliamentary system combined.”

The close intertwining of politics and economics in states that had “not yet emerged from feudal poverty” was an unprecedented and fraught experiment. As early as the 1950s, Aron could perceive the temptations of authoritarian methods in Asia and Africa, where the search for rapid economic growth increasingly clashed with the moral and political imperative of extending individual liberties.

He could see little virtue in imported solutions, whether derived from the French revolutionary tradition, which requires “people to submit to the strictest discipline in the name of the ultimate freedom,” or American can-do-ism, which “spreads unlimited optimism, denigrates the past, and encourages the adoption of institutions which are in themselves destructive of the collective unity.”

He would have been skeptical of the American faith in happy endings, such as the one that Fukuyama affirms when he writes, “We should have no doubt as to what kind of society lies at the end of History.” Aron, too, acknowledged the exploding demand worldwide for liberty, equality and dignity (which has replaced the ideal of fraternite). But, more presciently, he also recognized that economic growth transformed rather than resolved the old problem of hierarchy, and that an obsession with growth as an end in itself leads all too easily to popular authoritarianism, at the cost of individual liberty.

Pankaj Mishra is a columnist for Bloomberg View.