History continues. Francis Fukuyama may have achieved celebrity status when, in 1992, he published The End of History and the Last Man but his thesis is proving to be incorrect.
Fukuyama, known as ‘the court philosopher of global capitalism’, did not argue that ideology was dead but that the best possible ideology had won. The fall of the Soviet Union represented the final victory for capitalism and democracy. Marx had predicted that the triumph of communism will represent the end point of human history; Fukuyama that it is capitalist democracy.
Probably, as long as humanity survives, there will be no end of history. Globalisation, as the last phase of capitalist growth, is failing in keeping its promise of delivering widespread economic well-being. The wealth being created in ‘economies in transition’ is at the expense of the middle and lower classes in the developed countries. The 2008 financial meltdown at the very core of capitalism, and the subsequent economic crisis in the West, has accelerated the emergence of the ‘new poor’ in the richer countries.
Multilateral trade negotiations within the World Trade Organisation have been practically stalled since 1991 and countries are increasingly resorting to bilateral or regional agreements (such as the proposed Transatlantic Trade and Investment Partnership between the EU and the USA).
For a while, policymakers were convinced that the invisible hand had the right answer for everything. Now, no more.
At the political level, democracy is evidently struggling in taking root in many new nation states. Russia and other nations emerging from the ashes of the Soviet Union are leaning towards increased authoritarian rule.
The Arab Spring is proving to be a mirage. Far from the emergence of a ‘global village’, the world is drifting into rekindled political turmoil reminiscent of the post-Second World War era.
Moreover, the impressive economic growth achieved by communist China shows that there can be other ‘successful’ routes besides capitalist democracy.
Fukuyama himself is coming to realise the limitations of his thesis. In his new book Political Democracy and Political Decay he sets out to find out why democracy is failing. His answer: it is all about the institutions of the country. This is no academic discovery for political scientists have long emphasised the critical role played by institutions. These provide the rules of the game and every player is expected to be guided by them. Institutions determine the capacity of the State to get things done in achieving its goals, are dynamic and differ from one society to another.
What is surprising coming from Fukuyama is his argument that the abuse of democracy may ultimately lead to its end. He notes that authoritarian regimes are better in taking the necessary decisions and implementing them. Democracy tries to balance widespread political participation with the need to get things done.
Peter Katzenstein disagrees with this, arguing that although authoritarian rule may facilitate achieving short-term results, it will eventually become an unsurmountable hurdle in socio-economic development.
Fukuyama has come to realise that a strong State is not necessarily a democratic one (even though capitalism – private or State- still reigns supreme). A strong State is able to mobilise internal support.
Building State capacity is a lengthy and difficult process as is proving to be the case with Libya, Afghanistan and Iraq.
Fukuyama claims that democracy in the West is also threatened. The political system in the US is becoming extremely complex, with an excessive number of checks and balances often resulting in gridlock. Relatively a few powerful ‘dynasties’, each controlling a significant amount of votes, have cartelised the political system.
The situation is made even worse by the increased polarisation of the main political parties.
Another critical factor stalling the American political system is the fact the judiciary has taken upon itself some of the legislative functions of the State.
In real life, perfect competition is an exception and so is an equal distribution of political power
Fundamental rules can be changed through litigation in court, such as the Brown case which was moved by the National Association for the Advancement of Coloured People.
Political decay, according to Fukuyama, results from the failure of institutions to adapt to changing circumstances. As Darwin had noted, it is not the biggest or the strongest that survive but the fittest and most adaptable.
Fukuyama concludes that the US is trapped by its institutions which make governance ineffective and slow moving. This is leading to a loss of trust by the people in the US Congress.
Fukuyama points out that the EU’s political system is beginning to resemble the American one in ‘depressing’ ways, with powerful interest groups seeking to create veto points in Brussels as well as respective member states.
Inequality drives capitalism as this is deemed to stimulate competition, innovation and economic growth. However, economic inequality tends to foster the emergence of strong power groups which resist change to protect their vested interests.
In real life, perfect competition is an exception and so is an equal distribution of political power, which theoretically underpins democracy.
Fukuyama’s work continues to be extremely controversial. People are realising that capitalism and democracy do not present a perfect mix, with governments often ending up as puppets in the hands of powerful political elites.
These may speak the language of equality but settle only for privileges which they seek to protect at all costs.
Democracy needs to be consistently nurtured not abused.
fms18@onvol.net