Robert Kuttner: History’s Missed Moment
Robert Kuttner is co-founder and co-editor of The American Prospect, as well as a distinguished senior fellow of the think tank Demos. He was a longtime columnist for Business Week and continues to write columns in The Boston Globe. He is the author of Obama's Challenge and other books.
The epic financial crash of 2007–2008 should have produced a massive political defeat for the conservative ideology whose resurgence began three decades ago. Its signal achievement, liberated finance, did not reward innovation, enhance economic efficiency, or produce broad prosperity. Rather, the result was a speculative bubble followed by a severe crash. Along the way, the super-rich captured a disproportionate share of the economy’s gains, while other incomes stagnated. In the aftermath, ordinary people have suffered large losses of earnings, assets, social protections, and hopes for their children.
By any measure, therefore, 2008 was primed to be a political watershed on a par with 1932. History delivered a profound teachable moment for American progressives and European social democrats. But, to borrow from T.S. Eliot, between the idea and the reality fell the shadow. Three years after the financial dominoes toppled, right-wing ideas are ascendant and right-wing policies reign. Instead of reform and recovery, governing elites are delivering austerity. As the economy keeps sinking, the democratic left is in disarray nearly everywhere. In most Western countries, center-right parties govern and far-right movements are on the march.
The historian A.J.P. Taylor described the revolutionary year 1848—in which abortive liberal democratic revolutions across Europe were all crushed—as a moment when “history reached its turning point and failed to turn.” It would not be an exaggeration to view 2008 as the most stunning missed moment in modern political history.
How could this have happened? If laissez-faire could not be reversed as a practical and intellectual failure after a second massive financial crash on the conservative watch, when can progressives ever expect to rebuild a broad popular constituency for a managed form of capitalism? The explanations cannot just be idiosyncratic or personal—Barack Obama’s conciliatory temperament, Gordon Brown’s dour manner, or Strauss-Kahn’s predatory libido. The patterns are too pervasive. The story has to be deeply structural....