Democracy Is Over

OECD member states (as of 2006)
Organisation of Economically Crippled Democracies

So those young anarchist protesters ten years ago were right, globalisation did bring devastation and exploitation. Not to the Third World though. It actually turned out to be quite a treat for a lot of people there. In Europe and the US however, it has led pretty much directly to the collapse of democracy.

Globalisation has de-privileged the ordinary people of the West. And by the ordinary people, I mean anyone whose income derives from work rather than from ownership. Increasingly they find that they are in competition for employment not with the people of their own countries, or even with those of other Western countries, but all possible people.

In particular of course, people who aren’t the descendants of generations who fought for better working conditions, better wages, and democracy. Bluntly put, the work conditions and democratic freedoms enjoyed in the West were created when wealthy people needed a great deal of skilled and unskilled labour.

Conditions for the poorest improved suddenly and drastically at only two times during Western history. The first was after the Black Death. That decimated the peasant labourers, but it meant that afterwards there was a shortage of them. They could reject the previous conditions of their employment, which were more or less slavery, and start bargaining.

The second time was in the late 19th and early 20th centuries, when the Industrial Revolution created renewed demand for labour. Conditions in factories were of course horrific at the start when the supply of poor people exceeded the demand, but that turned around and labour was able to organise and gain much safer conditions and better wages. Ultimately, it gained political representation and universal suffrage.

Easing up conditions of trade with the rest of the world has completely undermined the position of the workforce – right up to the most skilled. Yet at the same time it has created new opportunities for business. With plunging labour costs, profitability has generally soared. But the tax base of most Western countries is not the wealth of business owners. To say the least, these are the people who can afford not to be taxed. They can afford the accountants. They can afford the lawmakers. So the tax base is collapsing. The countries of the West are simply running out of money, one after another.

But what can we do? It seems too late to introduce protectionism. The only option is to extract more money from the people who profited by exporting jobs – the corporations, and in particular the super-rich personally. But all the major political parties clearly do not dare to, they are helpless in the face of wealth.

Welcome back to serfdom.