The Retreat of Western Liberalism (2017)
Edward Luce (1968)
246 pages
The 2020 election of President Biden allowed Democrats and traditional Republicans to view Trump’s victory four years earlier as an aberration – a brief period that weakened, but failed to topple, America’s liberal democratic traditions and international engagements. Outside of Supreme Court picks who provided the majority for an anti-abortion ruling, Trump’s base gained little more from his tenure than the pleasure of watching him incessantly demonize his political opponents and the media; certainly, his signature piece of legislation, the 2017 tax cut, largely benefited his wealthiest supporters (and detractors, for that matter).
Trump’s recent re-election, while narrow, has shattered that brief aberration illusion. A variety of explanations have been put forward for his victory, but running through many of them has been a subtext of voter ignorance of the facts – a claim that Trump’s supporters failed to see through his exaggerations, misinformation and outright lies. Could they not understand, has come the plaintive cry, that his proposed tariffs and deportation policies could lead to increasing inflation; that he remains firmly beholden to the wealthy elite; that he peddles in ridiculous conspiracy theories, and misogynistic and racist tropes; and so on and on?
For journalist Edward Luce, the reasons behind Trump’s rise (and similar populist events in other Western countries) lie not in voter ignorance, but rather in a growing, deep-seated anger over the impacts of the current, global economic system. In his book The Retreat of Western Liberalism, he argues that the Western working and middle classes have watched their lifestyle deteriorate in recent decades, and so have become disillusioned with the entire liberal democratic project. The result has been a rise in populism – people willing to support anyone they feel will take on the entrenched institutions that seem focused mainly on the success of the political and economic elite. In the US, they turned to Trump, having found neither Democrats nor Republicans coming to their defense and aid.
Luce opens by describing the deepening economic challenges many have faced in recent years. In the West, he notes, income growth for the middle-class has stagnated over the past two decades, while incomes of “the global top 1 per cent … have jumped by more than two-thirds over the same period.” (30) Crucially, this growing inequality has come after “the Golden Age of Western middle-class growth between the late 1940’s and the early 1970’s … of rising incomes for the bulk of society.” (32) Thus, the middle class has experienced a dramatic decline in their living standards.
He dismisses arguments that the Western middle class remains far better off than people in large parts of the emerging world, or that describe the many ways people’s lives have improved over those of their ancestors a century, or a millennium ago – “to be clear: the West’s souring mood is about the psychology of dashed expectations rather than the decline in material comforts.” Beyond “our degraded retirement prospects,” we now look back longingly to a time when “we had faith that by the end of their lives our children would be three to four times better off than we were.” (32-33) Ultimately, he observes, such why are they complaining denunciations simply come across as an attempt by the wealthy and powerful to rationalize and perpetuate a system that operates mostly to their own benefit.
When people lose trust that society is treating them fairly, they drift into a deeper culture of mistrust. It should be little surprise that they come to view what the winners tell them with a toxic suspicion. (191)
Luce explores the ways in which typical metrics can be misleading when trying to understand frustration with the economy. The benefits of a rising stock market, for example: although 62% of US adults own stock, 50% of shares are owned by the top 1%, and the top 10% own 93% of stock market wealth – so a bull market hardly leads to a broad-based increase in wealth, as reflected in the popular phrase the stock market is not the economy. Or take GDP: despite GDP growth in the US over the past decade, “US median income is still below where it was at the beginning of this century.” (29) Unemployment statistics are another deceptive measure: in recent years, “all of America’s new jobs have been generated by independent work,” (62) which tends to have few or no benefits, and uncertain hours.
Even if some industrial production were to be brought home [to Western, high income countries], at great cost, via protection against imports [such as by tariffs], there would then be ongoing – and probably accelerating – use of robots. (121, Wolf)
A draconian and ineluctable requirement of free market capitalism: business owners must needs minimize the cost of labor to survive.
Perhaps in the twenty-first century populist revolts will be staged not against an economic elite that exploits people but against an economic elite that does not need them anymore. This may be a losing battle. It is much harder to struggle against irrelevance than against exploitation. (9)
Harari argues that the current upheavals in the West reflect people’s last-ditch effort to use their political power to change the system.
What all of these misleading economic metrics hide, Luce notes, is that our “meritocratic society has given way to a hereditary meritocracy,” in which “today it is rarer for a poor American to become rich than a poor Briton, which means the American dream is less likely to be realized in America.” (41) He finds this new reality to have powerfully negative implications for society, as growing inequality fuels anger that translates into an increasingly damaging rural-urban divide and bitter partisanship.
Having outlined the origins of the growing populist wave in the US and, more generally, the West, Luce explores the implications for the future of Western liberalism. As a broad indicator, he notes that the number of democratic countries, having reached a high point in the late 20th century, has dropped significantly over the past two decades. Democracy has lost its luster, he argues, not only for the middle class who feel betrayed by rising inequality, but also for elites, because “when inequality is high, the rich fear the mob.” (121) Thus, the working class become willing to support an autocrat hoping to destroy the institutions they see as biased toward the elite, while the elite support (often that same) autocrat in the hopes of controlling such a leader to protect their wealth and power from populist outrage.
The result in the US has been the rise of Trump; he has managed, so far, to beguile working and middle-class voters into believing that he will fight for them and, at the same time, to convince the rich that he will increase their wealth. Globally, Luce argues, the populist backlash has underpinned the success of the Brexit vote, and autocratic leaders in Poland and Hungary. There has also been a rise in the prestige of China, whose economic success over the past couple of decades has contrasted sharply with the West, as
the so-called global recession was primarily an Atlantic one. Indeed, growth in China, the world’s largest Autocracy, picked up for several years after 2008, [doing] wonders for China’s global image [and] its political reputation. (81)
To begin to counteract these events, Luce offers options that could together form “a new social compact” (196), including universal health care, humane immigration laws, simplification of business regulation and the tax system, and more. Many, if not all of these proposals will be familiar to most readers; they come, however, with a bracing caveat:
Whatever your remedies to the crisis of liberal democracy, nothing much is likely to happen unless the West’s elites understand the enormity of what they face. If only out of self-preservation, the rich need to emerge from their postmodern Versailles. (197)
It’s a bit surreal reading this book today, in the wake of the recent election. Published in 2017, it was written early in Trump’s first term as president. Although much of Luce’s discussion involves the economic and social forces leading to Trump’s victory then (as part of the broader retreat of Western liberalism), it also looked forward to Trump’s stated plans for his first term, and the impact they could have. Given we are now in a similar position, with Trump beginning his second term clearly more prepared this time to impose his will, Luce’s commentary suddenly becomes relevant again, in a kind of déjà vu.
[When Luce wrote this, he could still imagine Trump would be kept in check by the likes of, for example, “Lindsey Graham, the Republican from South Carolina. There are few who revile Trump more than the Republican hawks.” (132) How quickly Graham and the other “Republican hawks” debased themselves and their supposed principles by transforming into Trump’s sycophants in service to their own personal political gain. And certainly, that continues for Republican politicians in this second Trump term.]
Oddly, reading Luce’s book in 2020 or 2021, after Biden’s victory, would have had a completely different impact, as the country had seemed to have survived Trump’s first term with institutions relatively intact and the economic system largely unaltered. One could have too easily dismissed his arguments about the anger of the middle and working classes as exaggerated.
Now, amid the search for answers as to why Trump won a second term, perhaps Luce’s book can provide critical insight. The opening section in particular, which summarizes the economic forces that have played out in recent decades to the detriment of the middle class, may bring recognition to those who can’t understand how Trump won that, along with single-issue abortion voters, the bro vote, the insatiably wealthy, and white nationalists, there is a significant and growing group of the population who feel left behind, economically, and who have had enough of being ignored by Democrats and traditional Republicans as the global economic system enriches the elite at their expense. Just generating such awareness and understanding would be a huge step forward, as opposition to Trump tries to find its footing.
Luce’s prose keeps a reader engaged, but he can be a bit stream-of-conscious at times, as he seemingly tries to work-in as much of what he has learned and observed as possible. And, while he makes a convincing argument for the reasons behind the current populist moment, his overview of the current economic situation focuses on a few key metrics, without going into much detail.
Martin Wolf’s engaging The Crisis of Democratic Capitalism, mentioned above, explores similar themes to Luce, though providing a more detailed and systematic examination of our present-day challenges. He provides insight into how democracy and capitalism complement and yet also threaten one another.
The health of our societies depends on sustaining a delicate balance between the economic and the political, the individual and the collective, the national and the global. But that balance is broken. Our economy has destabilized our politics and vice versa. (xix, Wolf)
When the wealthy play too much of a role in politics in pursuit of their own interests, he finds, democracy fails, leading to autocracy. It becomes a conundrum: democracy and capitalism, Wolf argues, can only survive together, but are “always fragile,” the “delicate balance between politics and market can be destroyed, [through either] state control over the economy [or] capitalist control over the state.” (29, Wolf)
The final word to Luce, however, who wrote – again, it must be emphasized, in 2017 – that
unless Democrats can find a message and a candidate who appeals to the “forgotten Americans,” Trump will have a reasonable chance of being re-elected. (250)
Seven years later, we have our answer. Now we must urgently get to a clear understanding – and acknowledgement – of the plight of these forgotten Americans, and how to engage with their concerns.
Other notes and information:
Have you read this book, others by this author, or even similar ones by other authors? I’d enjoy hearing your thoughts.
Other of my book reviews: FICTION Bookshelf and NON-FICTION Bookshelf
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