The left, for its part, suffers from ambivalence toward the egalitarian accomplishments of the past. This leads to a fraught strategy to mobilize potential supporters. Is the goal to adopt European social democracy or to prove that social democracy is, in fact, an endogenous American tradition?
Freedom from the Market: America’s Fight to Liberate Itself from the Grip of the Invisible Hand, a new book by economist Mike Konczal, advances the case for tradition. A director at New York’s progressive Roosevelt Institute, Konczal argues a thread of grassroots resistance to unfettered capitalism runs throughout US history. Previous generations of Americans, he writes, have understood that “market dependency is a profound state of unfreedom.” In our 21st-century Gilded Age, Freedom from the Market offers a language to reclaim the “checks and hard boundaries” that once existed between markets and citizens.
Across historical case studies, Freedom from the Market refutes the conservative claim that Americans have always embraced capitalism. Each chapter is devoted to an aspect of life that has been shielded from the full reach of the market — and where protections could be further extended. Ethics and sustainability comprise the core objection to allowing markets to commodify everything.
“A society based entirely around the market,” Konczal writes, “will not be able to reproduce itself in a healthy manner, because all societies rely on an infrastructure of care to replenish themselves.” Markets are politically constructed, and their legitimacy and ultimate function depend upon the security and personal dignity of regular people. Policymakers, then, must actively attend to the “infrastructure of care” for the whole of society to prosper.
Konczal often highlights the contributions of reformers within broader social movements to help explain how protections from the market have evolved. Examples include the social insurance theorist I. M. Rubinow, whose research and advocacy aided the development of Social Security, and Dr. John Holloman Jr., who chaired the Medical Committee for Human Rights and whose investigations of Southern hospitals helped the US Department of Health, Education, and Welfare link Medicare payments to desegregation. This approach humanizes the origins of watershed policies that the general public, in a more complacent era before Trump, took for granted.
It also underscores that reform is difficult — it is never just a matter of passing or overturning laws, or creating public goods, which conservatives have long fallaciously denigrated as “entitlements.” Every stride toward a stronger social contract has required a minor revolution in the way our relationship to the market is conceived. The crux is that the more people can structure their lives outside of market dependency, the more freedom they consciously enjoy. A democratic government therefore has an obligation to not merely correct market failure in times of crisis but to also implement policies that remove unnecessary risk. This negates the libertarian argument that it is through markets that humans express “freedom.” But Konczal also disproves the axiom that limited government fosters “personal responsibility” by showing that constraints on the market allow people to exercise more freedom as citizens.
Consider Konczal’s discussion of Herbert Hoover’s voluntarism. Before his failures as president during the Great Depression defined his legacy, Hoover had a reputation as a humanitarian statesman, particularly due to his successful efforts to organize famine relief for Belgium after World War I. His philosophy necessarily relied upon civil society, and thus the charity of society’s wealthiest, to alleviate hardship.
Economic collapse revealed the severe limits of this idea, for it quickly became evident, as Konczal writes, that “local, temporary, and targeted support” from private groups was “no match for the national, persistent, and widespread misery of the Depression.” Government intervention ensured the market’s very survival, yet Hoover remained “ideologically locked between addressing the obvious need for action and insisting that only the private sector should respond.”
Franklin Roosevelt’s subsequent New Deal wasn’t about using the state to restore the status quo ante. It recognized that in order for a modern economy to have safeguards, business and finance must submit to regulatory power. It further recognized that society doesn’t flourish when market forces have free rein; most people become subsumed in the pursuit of wages to afford life’s necessities, and when either personal tragedy strikes or system-wide “shocks” occur, they are bereft of the means to subsist, let alone contribute to the well-being of others.
For Konczal, the purpose of public welfare and government regulation is that it provides the security that allows people to participate in civil society, devote time to family, and be creative. As he emphasizes, in order for high-quality public goods like healthcare and education to become societal norms, there must be sufficient pressure on the state to prohibit capital from monetizing all that makes life livable.
Freedom from the Market arrives at a moment when, as Konczal observes, millions of Americans are recovering a legacy of fighting market rule. While Donald Trump’s presidency has exacerbated the country’s polarization and fomented authoritarian and racist politics, political realignment is possible if the progressive movement is “broad and welcoming” and centered on universal programs.
What accounts, though, for the success of a reactionary countermovement that has pushed the country alarmingly close to oligarchy? A full answer is beyond Freedom from the Market, even as Konczal explains how political decisions over the past 40 years have enabled the market to overrun our lives. Part of this owes to the book’s structure: its purpose is to demonstrate that the erosion of democracy can be reversed.
Konczal deftly captures how a vast conservative network emerged to attenuate the social contract that evolved from the New Deal era through the 1960s. In that period, the United States demonstrated its greatest potential to move in the direction of social democracy. A more egalitarian future was glimpsed when the dismantling of Jim Crow briefly coincided with the zenith of democratic capitalism. The crises of the 1970s, however, created an opening for free-market ideologues to radically alter Americans’ conception of freedom.
Beginning largely with the Reagan administration, conservative economists and other policymakers used “the government and law to create their ideal vision of the economy,” one in which property rights reigned supreme, and people were taught to see themselves as “their own little firms.” Activist government, welfare, and economic rights, they argued, were inimical to the personal responsibility capitalism ostensibly cultivated.
Yet the profound disjuncture that Konczal describes between the freedoms advanced by the New Deal and the rollback of regulations and social protections that have ensued over the past four decades cannot be solely attributed to the conservative network that coalesced behind the Republican Party. The Democratic Party, which had served as the primary vehicle for reform in midcentury America, was an active participant in this shift to a new policy regime. Konczal implicitly recognizes this without dwelling on the interaction between left and right versions of neoliberalism. Adopting Thomas Frank’s trenchant critique of corporate Democrats, for instance, wouldn’t suit Freedom from the Market’s temperament and purpose. However, there is a certain path dependency in Democratic politics that weighs against Konczal’s optimism.
Following a presidential election with the highest turnout ever, it might seem paradoxical that there is an acute and pervasive sense that electoral politics affords no meaningful agency for ordinary voters. But mistrust of institutions and negative partisanship have become salient features of how voters experience politics. The loss of agency that afflicts the public today is an effect of what the sociologist Colin Crouch, at the turn of the 21st century, called “post-democracy.” Crouch was describing, in part, how the changed political landscape of the 1980s and 1990s had narrowed the range of ways in which ordinary people could influence the policies that determine distribution and improve life chances. Crucially, the pivot that the Democratic Party made toward market freedom was part of an international trend on the left that further separated the economy from democratic politics, with long-standing consequences.
Center-left leaders didn’t merely echo conservatives like Ronald Reagan and Margaret Thatcher in a search for electoral viability. Many broke from their predecessors’ support for market controls and a robust welfare state. Austerity, household debt, and deregulation increasingly substituted for public investment and progressive taxation in the name of global competitiveness and flexibility. Their parties changed from organizations influenced by rank-and-file membership and local power bases into elite hierarchies, losing the language of mass politics. Their consultant-tested messages accentuated a technocratic approach designed to satisfy financial markets, transnational firms, and powerful campaign donors.
One of the more startling aspects of this trend was that the parties most historically responsible for democratizing politics and the economy — that is, labor-aligned center-left and social democratic parties — were now restricting what politics was fundamentally about. The French economist Thomas Piketty has similarly identified the twin processes of deindustrialization and globalization as the reason that the center-left catered to more affluent, highly educated voters. Rather than question whether these processes were fully inexorable, the center-left made a long-term calculation over where new, if narrow, majorities lay. Consequently, economic policy has become entirely dominated by the elites that make up the “Brahmin left” and the “Merchant right,” to the exclusion of working class and downwardly mobile people. This has at the very least intensified the global surge of right-wing populism. Just as worrisome, there is no clear sign that the left can overcome an establishment that concedes little about the depredations engendered by “free markets.”
At the heart of Freedom from the Market lies this essential question: what is the value of citizenship if we cannot define our lives outside of market rule? For all the examples of how to deepen freedom, it avoids the corresponding question of what the Democratic Party represents and where it is headed. One of the greatest paradoxes of American politics is that the foundation for American social democracy is largely the work of a Democratic Party that was never social democratic, and which contained, until the mid-1960s, a powerful reactionary wing that was the architect and defender of Jim Crow. The modern Democratic Party proclaims that it represents a multiracial United States, yet it has struggled to prove that it will deliver essential public goods. Konczal’s real audience is the party upon which American democracy now depends.
Justin H. Vassallo is a writer and researcher who specializes in party systems and ideology, political economy, American political development, and modern Europe.