(Adam Tooze) - ‘Whatever it takes.’ These words, spoken by the president of the European Central Bank, Mario Draghi
, to a crowd of investors in the City of London on 26 July 2012, have come to represent the symbolic end to the acute phase of the global financial crisis. In the political sphere, by contrast, where words are supposed to be everything, we have not yet been able to draw the line. More than four years on, we know that in 2012 the political fallout was only just beginning.
The experience of the 20th century suggests that when trying to channel nationalists’ energies into progressive politics, it is crucial to be clear-headed about one’s objectives. When you say you want to put the nation in charge and to throw off the yoke imposed by the invisible power of the cosmopolitan ‘market people’, who do you expect to rally to your banner? Streeck may protest to sympathetic interviewers that when he advocates immigration restrictions that doesn’t make him a closet AfD supporter or a proto-fascist. But given Streeck’s slide from a conflictual notion of class to the idea of an integrated society and from there to an enthusiastic embrace of the nation, and all this against the backdrop of bona fide nationalist mobilisation, what does he expect?
The weaknesses of Streeck’s Staatsvolk v. Marktvolk scheme don’t end there. It isn’t just that the two are entangled. It is also simplistic to imagine that the confrontation ever takes place in dyadic isolation. States aren’t simply bounced between citizens and markets. They have to deal with other states, which are themselves juggling their relations with citizens and markets. And the state, the Staat that constitutes the Staatsvolk, has an identity, logic and interests of its own and is itself tangled in a complex web. In the face of Habermas’s normative cosmopolitanism and Streeck’s reductive economism, it is worth emphasising that the EU was conceived first and foremost as neither a moral nor simply an economic project, but as a power political vehicle to constrain West Germany while also enabling it to contribute to Cold War rearmament and reconstruction. In the 1990s the move to realise European Monetary Union was in part a neoliberal stratagem to install a permanent disinflationary regime. In part it was an effort to create a European society by stealth. But what moved it from the drawing board into reality was Helmut Kohl’s effort to reconcile France and the rest of the EU to German reunification and to bind a united Germany indissolubly to Europe. Twenty-five years later the balance within Europe is continually shifting and so too, crucially, is the position of the US in relation to Europe. These complex forcefields won’t simply disappear in the face of deglobalisation. If you break up the Eurozone, you don’t exit the power-field and thus gain sovereign autonomy. You do change your position within it and your way of relating to it – and not necessarily to your advantage. If we were to step back from the Eurozone to a reborn European Monetary System, as Streeck advocates, that wouldn’t set France or Italy free, but would place them back in the unequal power relationship with Germany that they sought to escape in the 1980s. And to advocate doing this at precisely the moment when the gamble the non-Germans made on the ECB has paid off, when an American-trained Italian macroeconomist is floating the entire European bond market to the horror of German conservatives, is either naive with regard to the way European monetary politics work, or disingenuous.
The ECB, in Streeck’s eyes, is no more than a tool of the banks. When he mentions Draghi at all it is to describe him as a ‘financial functionary’ or to associate him with Goldman Sachs. This allows for no autonomy of the apparatus of government or the technicians who run it. It’s true that the record of the ECB, particularly in the crucial period between 2008 and the autumn of 2011, gives little reason to think that central banks might play any constructive role in mediating between capital markets and democratically elected governments. Caught between Berlin, Paris, the Bundesbank in Frankfurt, the IMF and the US Treasury, clinging to its own deeply conservative vision of economic governance, refusing to face the entanglement of Europe’s banks both with US subprime assets and European sovereign debt, the ECB’s leaders delivered one of the most destructive and, in the end, self-subverting performances in the history of economic mismanagement. Streeck never identifies whose interests he imagines might have been served by this fiasco; he does no more than to gesture to ‘bankers’ and ‘German export interests’. But insofar as the markets have spoken, their judgment has been devastating. It was precisely the realisation of how deep the loss of confidence had become that prompted Draghi’s unscripted remarks – ‘Whatever it takes’ – in July 2012. Of course central banks have major legitimacy issues. Their autonomy cannot be taken for granted; they are held in place by a complex geometry of forces. But saying that is quite different from generalising a moment of unprecedented panic and mismanagement into an insuperable dilemma for capitalist democracy. Thanks in large part to bond-buying by the Fed, the Bank of England and the Bank of Japan, the bond vigilantes have remained confined to the Eurozone.
But, as has become clear since 2012, the careful calculation of options and precise analysis of the mechanics of crisis is not Streeck’s project. With a passion bordering on that of a convert, Streeck feels he has identified a general logic of crisis. The market and its functionaries have brought about an existential crisis of social and political life: they must be resisted by any means necessary. What’s more, the gravity and urgency of the situation make detailed tactical argument unnecessary. Indeed, it may even be unwise to be reasonable. As financial markets have shown again and again, panic is what gets you attention. As Streeck remarked in Buying Time:
Greater agitation and unpredictability among the people – a spreading sense of the profound absurdity of the market and money culture and its grotesque claims on the human lifeworld – would at least be a social fact; it could come to be seen as the ‘psychology’ of citizens, alongside the psychology of markets and demanding as much attention … even though they have no banknotes as arguments but only words and (who knows?) paving stones.
To the Guardian he commented simply: ‘I think more such scariness must happen.’ The authorities should be ‘scared shitless’.