Likewise, the mainstream media’s disgraceful practice of sane-washing it all is equally distressing.
Despite all of this, it is essential to recognise the underlying dynamic: the strange death of North Atlantic liberalism.
Part of the challenge is specifying exactly what is designated, although the term might encompass a better word.
North Atlantic liberalism is distinct from the longer-term tradition of European liberalism, which dates back to the eighteenth century and was eventually codified (at least to an extent) in the Manchester School’s commitments to individualism and laissez-faire capitalism.
Beginning in the early 1930s with Franklin Roosevelt’s New Deal reforms, a new version of “small l” liberalism began to coalesce. This piecemeal process lacked a unifying positive theory, although Keynes’s and the Cambridge School’s economics were often important reference points.
To the extent that it constituted a coherent phenomenon, it was composed of the various attempts by governments of industrialised states in the North Atlantic region to come to terms with capitalism’s increasing dysfunctionality. It began with the long depression from the 1870s through the 1890s and reached crisis proportions by the late 1920s.
This economic dysfunction had increasingly disturbing political manifestations. The Bolshevik Revolution in Russia created a base for expanding communist radicalism in Europe. Subsequently, and in part as a response, far-right movements arose that rejected liberalism and its egalitarian trappings, even if these were often more aspirational than real.
While still nominally driven by the individualism and free-market orientation of the older liberal tradition, North Atlantic liberalism was characterised by a willingness to deviate from its dogmas. It countenanced government intervention in markets and, in many places, a more or less moderate program of tamping down income inequalities.
The noontide of this new liberalism came in the quarter century following the end of the Second World War. The US government channelled billions of dollars of aid via the Marshall Plan to rebuild European economies.
This was partly motivated by humanitarian concern. Still, a more important motivating factor was the need to halt the spread of communist influence resulting from the persistent dysfunction of liberal capitalism in the immediate postwar years.
This was also the peak of the European welfare state. It is worth noting that the expanded social safety net that arose in most of industrialised Europe in the late 1940s and 1950s was just as often implemented by Christian Democratic parties as by their Social Democratic competitors.
Once again, blunting the appeal of communism was, if not paramount, at least a significant policy goal.
Another feature of the liberalism of this period was some degree of progressiveness in fiscal policy. In the 1950s, the top marginal tax rate in the United States was above 90%, and many other states in the North Atlantic region adopted (or continued) similar income tax policies.
Overall, this was a period of relatively rapid economic development. In 1950s Europe, GDP growth averaged around 4%, and in the US around 3.7%. Union membership was high by historical standards, and there was significant coordination between industry and organised labour.
This relatively rosy picture is not, of course, meant to obscure the dark side of the system. People benefitted less to the extent that they were not white, male, or property owners. Women, minorities, and the poor were similarly more liable to be subjected to the repressive and carceral powers of the state.
The process of decolonisation was often accompanied by extreme violence. Vestiges of the colonial system that had existed since the nineteenth century persisted into the 1970s, and the system’s continuities synergised in unfortunate ways with the shifting of the Cold War’s systemic conflicts to proxy actors in Korea, Indochina/Vietnam, and numerous other places.
North Atlantic liberalism was a system that never lived up to its ideals. Its relatively smooth functioning was predicated on the resource extraction from and displacement of surplus violence and surplus exploitation onto subaltern groups both within and outside the colonial metropole.
Claims to improvements in condition could be made based on rights and dignity supposedly implied by the terms of the system (“We hold these truths to be self-evident, that all men are created equal…”, “Die Würde des Menschen ist unantastbar. Sie zu achten und zu schützen ist Verpflichtung aller staatlichen Gewalt”). Occasionally, these claims were successful.
The system began experiencing severe crises in the 1970s. The oil shock and the collapse of Breton Woods accompanied, and in part caused, a generalised decline in the rate of profit.
The collapse of actually existing socialism in 1989-90, among other things, removed an alternative system that, however threadbare, needed to be outbid by liberal capitalism.
In the United States, since the late 1950s, the right had undertaken a project of convincing middle to lower-income Americans to vote in ways counter to their economic interests by stressing the dangers posed by communism and promoting xenophobia against non-white immigrants.
The collapse of communism hardly affected this project, with charges of communist sympathy mapped onto any group or figure even marginally to the left of the moderate wing of the Republican Party.
An analogous process occurred in Europe, although somewhat later and with slightly different contours.
The latter mostly resulted from the existence of social democratic parties in European states, as there were none in the United States. Once again, the right’s project was to mobilise populist sentiment by stressing a mix of nationalistic and economic themes inflected by unapologetic xenophobia.
The final step in the process was the shift to a low-growth norm in the states of the North Atlantic world, as described in the work of the economist Thomas Piketty and others.
Beginning in the last decades of the Cold War, the parties of European social democracy and North American liberalism, which collectively composed the residual political base of North Atlantic liberalism, shifted to the right.
Rather than undertaking policies of moderate state intervention and planning that had underpinned their influence in the postwar decades, the parties of North Atlantic liberalism adopted an aggressive version of technocratic neoliberalism.
The Democrats in the United States, Britain’s Labour Party, the SPD in Germany, and most parties of the moderate left shifted their pitch from “We will make a system that works” to “We will keep the system from collapsing in the short term (and that’s about it).”
The consequences of this shift are obvious. Kamala Harris’s recent defeat in the US presidential election was due as much to the Democrats’ lack of new ideas as to Donald Trump’s populist appeal.
As Matt Karp noted in the November/December 2024 issue of the New Left Review, the addition of 2 million or so votes to Trump’s total was dwarfed by the more than 7 million Democratic voters from 2020 who stayed away from the polls in 2024.
The story is much the same in Europe. The rise of the extreme centrist Keir Starmer has little to do with Labour’s ‘positive’ policies, a mix of warmed-over ideas that were uninspiring the first time around.
Instead, Starmer owes his current position to the spectacular bungling of the last two Tory premiers. As of this article’s writing, there is every indication the electorate will slosh back to the right side of the tub as long as the Tories can find a leader of even minimal competence.
Germany’s Social Democrats remain mired in half-baked neoliberalism and still on the hook for the grossly unpopular Hartz IV labour market reforms. In southern Europe, the moderate left is in a similar condition in Spain, while in Italy, it had practically disintegrated even before the rise of the Giorgia Meloni’s ‘postfascist’ Fratelli d’Italia. Elsewhere in Europe, matters are little better.
The road back to coherent leftist politics is hard to map. The return of growth rates comparable to those seen in the 1950s and 1960s is astronomically unlikely to make that possible.
The rise of automation and the increasing prevalence of AI will further depress the availability of jobs that have supported middle-class consumer culture since the end of the Second World War.
Leftist parties need to acknowledge this. The key issue is that they must also be willing to engage in interventionist politics, the kind that shaped earlier periods of prosperity.
What these might be is open to discussion. However, solutions will not be found in electoral strategies acceptable to party megadonors.
Ultimately, the parties that made up North Atlantic liberalism (and could do so in the future) must decide which end of the income distribution they wish to serve.
The answer cannot be both. Whatever else might be the case, that strategy is a loser.
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Photograph courtesy of Joel Schalit. All rights reserved.
