Professor Rosalind Dixon and Professor Richard Holden in a new book titled, From Free to Fair Markets: Liberalism After COVID, have provided strong and to a great extent even convincing arguments for governments world-wide to consider rethinking ‘liberalism’ as the model of governance in a post-Covid era. Additionally, the authors have posited ‘democratic liberalism’ as an attractive and viable replacement for ‘neoliberalism’ to reorder polity, economy and society. Democratic liberalism, the authors have explained, adopts ‘fairness’ as a new lens for making and doing law, policy and regulation instead of the much older and time-tested ‘free markets’ lens of neoliberalism.
Seemingly, the title of the book gives its readers a slight hint that it might be a purely economic analysis of the ‘liberalism’ doctrine. However, in actuality, the authors from the Law and Economics school, have gone much beyond a narrow and banal economic analysis to construct a rather comprehensive ‘justice and fairness’ focused conception of their ‘democratic liberalism’ approach. The authors have acknowledged at the outset that the ‘democratic liberalism’ approach in its pedigree has a close connection with economist Amartya Sen and political philosopher Martha Nussbaum’s ‘Capabilities Approach’ to justice. While arguing quite strongly against ‘neoliberalism’ throughout the nine chapters of the book, the authors have recounted lived realities and everyday experiences of people during the pandemic instead of relying on mere quantitative data, cold numbers and hard statistics.
The introductory chapter lays bare the three major problems that governments across the world have been facing namely, unemployment, poverty, and pollution. The authors have elaborately described how the pandemic situation has exacerbated these problems to a significant degree and how neoliberalism has done little to alleviate the dismal state of affairs. Instead, as the authors have reasoned through illustrations how the three central tenets of liberalism namely, ‘globalisation, automation and gigification’ (GAG) have wreaked havoc in the lives of the already marginalized and vulnerable like women, disabled, poor, farmers, laborers, unemployed youth, elderly, religious and sexual minorities.
The central question that Dixon and Holden have addressed in their fascinating book is one that governments have been struggling to answer: how to do governance— law, policy and regulation— that is better, efficient, and fair post-Covid? The authors have majorly relied on American and Australian experiences, sparingly on European and Scandinavian examples and on even fewer Asian and African instances to carve out the ‘democratic liberalism’ project which they have argued is a middle path between democratic socialism and economic nationalism. To that extent, one might find striking resemblances between the democratic liberalism project and the ideational history of the concept of ‘welfare state’ that emerged in the period between 1875 and 1914 and post-World War II in countries like Germany, France, United Kingdom, U.S., the Scandinavian countries, Australia and New Zealand. Like democratic liberalism, the welfare order in the late 19th and early 20th centuries was characterised as “not quite yet socialism, but certainly no longer capitalism”.
A close read of the book also triggers the following question: whether the democratic liberalism project is a close cousin of the ‘third way’ concept of the 1990s that retained the ideational primacy of free market mechanism while significantly restructuring the concept of ‘welfare state’.
Can we then say that because of its close resemblance to the concepts of ‘welfare state’ and ‘third way’, democratic liberalism is like old wine served in a new bottle? After all, all three approaches are seemingly opposed to neoliberalism and seek to eliminate the unjust elements of laissez-faire capitalism on the one hand while ensuring social justice on the other hand.
The authors argue and demonstrate through illustrations that democratic liberalism as an alternative to neoliberalism does not conceive of a government as being either “interventionist” or “indifferent” rather, they construct an image of an “interested government”, one which is interested in maintaining a fine balance between seemingly contradictory democratic commitments of “dignity and equality, as well as freedom or autonomy”. I enjoyed reading Dixon and Holden’s comprehensive analysis and handling of a difficult question about remodelling global governance — its ideology, structure, and style — and making a drastic shift from an age-old ‘free markets’ approach to a comparatively newer and abstract ‘fair, compassionate and dignitarian’ model. However, I am quite sceptical about the viability and workability of their model of democratic liberalism particularly, in developing countries and Least Developed Countries (LDCs). Even in the context of developed nations, I find the democratic liberalism project wanting on several counts.
First, it is important to determine from a purely ethics and moral philosophy point of view whether the democratic liberalism model propounded by the authors is well suited to underdeveloped countries in Africa and Asia in the post-Covid era. For example, the authors have argued against welfare policies and schemes that are “economically unsustainable or entail large scale expenditure with no long-term benefits or investment potential”. To that extent, how would the Government of Kenya have dealt with the ‘humanitarian crisis’ resulting from the pandemic. Lakhs of flower farm and horticulture workers went jobless when global flower exports halted all of a sudden, aeroplanes were grounded, tons of flowers rotted but celebrations were cancelled, and florists shut shop. Similarly, the question before the Government of India during the pandemic was whether to provide compensation to the families of thousands of migrant workers who had lost their lives during the pandemic.
Where citizens have suffered from the state’s failure to provide for basic needs and without sufficient cushioning in a crisis moment, then can we really say that they should be left to die? Moral philosophy, humanity and ethics require that governments look beyond economic efficiency and return on investment when in times of crisis human lives have to be saved or deaths have to be prevented, as argued by Professor Jonathan Glover in his book Ethics and Humanity. As such, democratic liberalism as a concept must not ideally exclude democratic commitment to ethical and moral values like compassion, love, and sustenance especially, post-pandemic when citizens would require some hand holding, support and cushion to bounce back again. Reasonably, the state’s post-Covid mantra for governing citizens can neither be ‘live and let live, die and let die’ nor ‘God helps those who help themselves’. Rather, as T.H. Green had conceptualised that the ‘liberating function’ of the state is to ‘hinder hindrances to good life’ and to create an environment for individual citizens to exercise their ‘positive freedom’ and realise their own potentialities.
Second, why does the meaning of democratic liberalism exclude from within its purview social welfare programs like ‘Universal Basic Income’ (UBI) and why do the authors consider the government’s expenditure to fund a UBI-type scheme as a ‘bad debt’ when studies, pilot experiments and reports have shown how effective such measures have been to alleviate the lives of the marginalised and deprived sections of the society. The argument that UBI creates a dependency culture among the poor is rather flawed.
An overemphasis on ‘work’ and ‘wages’ does not resolve the problem of unemployment and poverty if the beneficiaries are still not able to convert the primary goods into good living as pointed out earlier by Sen through his conception of ‘conversion handicaps’ in his book ‘The Idea of Justice’ and recently by economists Abhijeet Banerjee and Esther Duflo in their book ‘Poor Economics.’ They have argued how there exist supervening circumstances namely, personal heterogeneities related to age, gender, disability and illness, diversities in the physical environment like vulnerabilities posed by climate change, water depletion and pollution, variations in social climate like poor public healthcare and substandard educational facilities, and differences in relational perspectives like cultural demands as well as societal pressures of reputation and status, factors of poverty that tend to hamper the actual enjoyment of given resources and entitlements.Reimagining Neoliberalism: Blog Symposium on ‘From Free to Fair Markets’ #2 — Law School Policy Review & Kautilya Society