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Two Cheers for Democracy

Jonathan Freedland in the Guardian (November 16th) is reviewing David Runciman’s The Confidence Trap: A History of Democracy in Crisis from World War I to the Present, an account of – and it would seem largely a vindication of – the messy business of modern liberal democracy.

“Democracies,” writes Freedland summarising Runciman, “develop confidence in their long-term resilience, based in part on their ability to adapt (in contrast with rigid autocracy). This confidence that all will end well leads democratic states to be complacent, allowing problems to fester, safe in the knowledge that, when it really counts, they’ll solve them. These problems eventually come to a head in the form of a grave crisis. But confronted with such a crisis, democracies usually do adapt just enough to survive. Confidence returns, which eventually turns into complacency and so it begins again.”

The Runciman theory is that lots of little failures combine to produce lasting success as democracy appears, partially because of the way politics is reported by the press, to continually lurch from crisis to crisis, and yet, normally to hang on. So democracies have a tendency to survive, to muddle through and are of course, generally more savoury than dictatorships. But are they any longer democratic?

Freedland points to democratic governments’ apparent powerlessness over money markets. This is of course a theme that seems particularly pertinent in the last number of years but market power is not anything particularly new. Capital flight sank the early 1980s radical reform programme involving hugely significant transfers to the poor introduced by Mitterand’s first prime minister, Pierre Mauroy (who died this year). In Sweden in 2002 the general election threw up a majority for three parties of the left, but as the pundits confidently assured us as the results came in, this was not going to produce a government of the three parties of the left as the markets “would not allow it”. So we have the political system and we have the economic system and the latter does not, it would seem, see any need to bend the knee to the former.

Freedland recalls the plight of Bill Clinton, who, “on realising he had to trim his economic plans to placate those who lend money to the US government, famously bellowed to his aides: “You mean to tell me that the success of my programme and my re-election hinges on the Federal Reserve and a bunch of fucking bond traders?”

That is indeed what they meant to tell him. Voices on the left mostly seem to assume that it is sufficient merely to mention the existence of this power of money over politics for us all to decide that it is illegitimate and install the alternative. Except that they, and we, don’t have the alternative. Private finance has been lending to governments for a very long time (Chaucer in the fourteenth century wrote of “Lumbardes of Lukes, that lyuen by lone as lewes”, Lombard bankers who lend money like Jews). Money and power have co-existed for a long time and it would seem that for the most part if you want to borrow money you must abide by money's rules. It would seem that people can vote for whatever they like, but if they vote for something that will break the system that will simply not be allowed to happen. And that is probably why they don’t bother all that often voting for something that will break the system (God knows it has been prone enough recently to almost break by itself). So, a democracy that is quite clearly attenuated, but at least the police don’t come knocking at the door at 5am.