Headline: The crisis of modern liberalism is down to market forces

Sub-headline: Liberals are often led astray by their addiction to macroeconomic variables such as GDP

Mr. Münchau’s  rhetorical/political  landscape is teeming with ideas, concepts and actors:

Wolfgang Kartte :

Like the majority of economic policymakers in Germany, Kartte, who died in 2003, was a lawyer. He said he considered his job as helping the little guy to defend himself against the big guy. This was the job of a lawyer, not of an economist. Moreover, he said he was not interested in levelling the playing field, as the metaphor goes, but in tilting it in favour of the little guy.

‘The Crisis of Modern Liberalism:

The crisis of modern liberalism has similar elements. We have our own version of the little guy versus the big guy problem today — except that there is no one to tilt the field in the other direction. Smaller companies pay more taxes relative to their income than large multinational corporations. The economic policies that followed the financial crisis ended up widening income and wealth differences. Large immigration flows created insecurity, as did the arrival of new technologies. When you call voters deplorable — or patronise them, as happened in the UK after the Brexit vote — you add insult to injury.

Ordoliberalism:

Kartte was an old-fashioned German ordoliberal, a school of thought that originated after the breakdown of German democracy in the early 1930s. The macroeconomics of German ordoliberalism is somewhat dodgy. But they excelled at one particular thing. Their intellectual leaders explained better than anyone else how the German liberal order of the 1920s collapsed and how it drove a majority of the population away from supporting it.

Weimar Republic:

The short, flippant answer is that the Weimar Republic favoured the big guy. The macroeconomic shocks of the period — hyperinflation and depression — are well understood. They contributed to a large extent to the political alienation of the middle classes. But they were not the only causes. The period also saw an increase in industrial cartels that threatened the livelihoods of small merchants and entrepreneurs.

Managing Capital:

This is not an argument about redistribution. This is about actively managing capitalism’s playing field to ensure that the majority of the population stays on it.

Margaret Thatcher:

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Recall Margaret Thatcher’s successful brand of entrepreneurial capitalism in the UK in the 1980s.

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But to save modern capitalism we will need to find ways to keep the median voter committed to the system, just as Thatcher did in the 1980s.

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The main constituency backing the Thatcher revolution in the 1980s was the C2s — the demographic classification for skilled working class people. Thatcher looked after the median household. Her successors first lost the middle classes, and then pretended to be shocked by events such as Brexit.

Addiction to macroeconomic aggregate variables:

What often leads the supporters and defenders of modern liberal democracy astray in their analysis is their addiction to macroeconomic aggregate variables such as gross domestic product and the officially recorded rate of unemployment.

The main constituency backing the Thatcher revolution in the 1980s was the C2s — the demographic classification for skilled working class people. Thatcher looked after the median household. Her successors first lost the middle classes, and then pretended to be shocked by events such as Brexit.

Liberal Irony:

Any system that leaves behind 60 per cent of households will eventually fail. It is the ultimate irony: liberalism is failing because of market forces.

Mr. Münchau capacious essay needs to be more historically focused! It appears to this reader, that this essay should have been much longer, to even pretend to argumentative coherence- perhaps this is just the outline, a rough draft, that needs more time and critical focus?

The conventional notion of ‘The Crisis of Liberalism’ ignores that ‘Liberalism’ surrendered en masse to Neo-Liberalism. The proof of that is the rise of both the New Democrats in America, and New Labour in Britain as the enactors of that now utterly failed Free Market Dogmatism: Thatcher was just the distant, but malevolent, precursor of the 2008 Economic Collapse!

Almost Marx

https://www.ft.com/content/9dfea428-0538-11e9-9d01-cd4d49afbbe3