Why we are Where we Are – Part Two

Why we are Where we Are – Part Two

By Duncan Whitmore

In Part One of this two-part series of essays we explained how events in the nineteenth and twentieth centuries shifted Western society from a preponderance of the “economic means” to the “political means” characterised by a transition away from the tendencies on the right hand side of the following table to those on the left hand side:

Fig. A

In this essay, we will explore the moral and cultural gulfs that are now swallowing Western society (addressing the puzzling question of why the right has been so defenceless against it), before examining how Western liberal democratic polity over the past thirty years has produced the situation in which we find ourselves today.

The Culture War

It should be clear to anyone by now that cultural leftism1 is far from being a neutral or dispassionate phenomenon. It is not characterised by a genuine tolerance for, and openness towards, various lifestyle choices and personal dedications, nor does it seek to encourage everyone to live in harmony regardless of colour or creed. Any appearance it may have had in this regard in earlier years was a mere disguise – the proverbial wolf in sheep’s clothing. Instead, cultural leftism is a logical outcome of a movement towards the political means, seeking the destruction of old, generally locally defined traditions, customs and allegiances – to family, to community, to religion, to nation, to traditional morality – that stand in the way of the consolidation and centralisation of power. Thus, it is authoritarianism coated in a liberal veneer – it feigns to promote alternatives and antitheses to traditional allegiances and customary cultural practices while demonising the latter, aggressively, as oppressors and exploiters. Its strategy, squarely, is to divide and conquer, and those on the left who believe it to be a genuine form of liberalisation for (allegedly) un-championed minority interests are simply useful idiots.2

Amidst the poisonous rhetoric of identity politics and the uncompromising executions of “cancel culture”, libertarians, and others on the right, have recently begun to chastise themselves for their ignorance of the insidious ascendance of cultural leftism through the ranks of the government, the civil service, the universities and the mainstream media during the past thirty or forty years. Doubtless, this is a failing of which we are guilty, and part of it can be ascribed to the right’s historic focus on economic welfare with a relative blindness to the social and cultural dimension. Moreover, in their disguise as genuine social liberalisation against outdated and “stuffy” attitudes, the infant sprouts of cultural leftism probably did not appear as much of a threat anyway.

It would, however, be a mistake to regard this as a sufficient explanation. In fact, as we shall see, it is the economic policies of the right that have been unwittingly complicit in breeding cultural leftism. For the cultural elements of a society do not possess some kind of antecedent or foundational importance compared to economic factors. Culture, morality, tradition, and so on are always a product of the economic situations faced by a people and the choices that are made to deal with those situations – they are neither random nor do they exist in a vacuum but are intimately connected to the ways of doing things. Thus, if the economic conditions and/or choices change then it is obvious these other elements must change also. Indeed, if Antonio Gramsci, the father of cultural leftism, saw that the working class would fail to rise up against their overlords because there was a unity of culture, custom, tradition and religion between workers and bosses alike, then there is probably a simple explanation for this. That – contra Marx – the economic relationship between capitalists and workers was also unified and was not antagonistic or exploitative. A mutually beneficial economic relationship is hardly fertile ground for sowing an ideological gulf. Thus, in order to destroy cultural unity your first have to destroy its economic foundation.

True enough, cultural erosion may now be acting as a greater motivational factor for nationalist and populist resistance to leftism compared to economic factors, but the very reason that the right is fighting a culture war today is because it never really won the economic war yesterday. As we mentioned in Part One, the kind of economy left behind by the Thatcher/Reagan era is decidedly not a free economy, and will, thus, display all of the tendencies towards consolidation and centralisation that we have argued are the natural progression of the political means – that progression requiring, as we have said, the breakdown of old allegiances and traditions, i.e. the very goal of cultural leftism. Moreover, the self-oriented, hyper-individualist, “homo economicus” brand of capitalism for which the 1980s are infamous was itself a direct threat to traditional values and social relationships. But cultural leftism owes its ascendance also to the prior weakening of societal and cultural bonds achieved by the combination of democracy, inflationism and welfare statism that we have suffered since the post-war era – elements of our society that those on the mainstream right have been content not only to leave intact but to also actively champion.

We have described this in detail before, and interested readers can read this here. However, a condensed version of this explanation will help to illustrate the point.

For a straightforward example, take the leftist assault on the nuclear family. Is it likely that such an assault would have been successful if the welfare state had not served to reduce the economic functions of the family – the raising of children, and mutual care in periods of sickness and old age – to a practical irrelevance? Moreover, wouldn’t familial bonds be stronger if inflation had not forced both parents into work while dumping the kids in childcare?

Unfortunately, the effects of the welfare state go far beyond this, as it has a much more devastating result: the sundering of cause from consequence. If people are always cushioned from the results of their bad choices (and penalised for their good choices by increased taxes necessary to fund those who make bad choices) then characteristics inherent in making good choices – patience, prudence, perseverance, knowledge, wisdom, experience, and judiciousness – cease to have value, and are replaced by laziness, ignorance, stupidity, mindlessness, carelessness, and impetuousness. Further than that, however, if bad consequences cease to rain down as a result of bad decisions then such decisions are no longer “bad” in any meaningful sense. If there are no longer “good” and “bad” decisions then all paths become equally valid; all decisions are of equal worth; all outcomes are as good as any other. Within this polluted soil sprouts moral relativism, permissibility, hyper-individuality, and non-discrimination, with social cohesion and social co-operation fracturing as relative homogeneity splinters into individualistic loners pursuing their own flights of fancy. Culture ceases to reflect and idealise the realities of economic life – indeed, there are no longer any ideals. Objectivity, reality, truth, and reason give way to the post-modernistic obsessions with subjectivism, relativism, pluralism and irreverence.

The economic effects of inflation – the falsification of values, the decimation of savings, the illusion of wealth – similarly create habits and attitudes that are completely at odds with the normal moral, cultural and spiritual health of a nation. Inflation makes us cynical, impatient, and short term oriented. It quickens the pace of life as we struggle to make our work pay the value of what it produces. Patience, hard work, and saving become pointless as their value is robbed before it can be enjoyed, replaced by dreaming of “quick wins” and “lucky breaks”. Quality, beauty and durability cease to be sought after, giving way to quantity, disposability, functionality and convenience – a fact that pervades material and non-material aspects of our lives. We watch films saturated with mindless “action” and special effects instead of the steady development of character and plot; great symphonies have given way to the instantly forgettable, mindless repetition of two minute pop songs; books and articles dealing with weighty subjects are discarded in favour of clever sound bites on Twitter.

Finally, it is likely that democracy has done more to create an economic chasm between rich and poor, together with a milieu of “exploitation”, than Marxist ideas ever could. For under democracy, the merging of state power into the people themselves means that all rights and the disposal of all property is essentially a matter for the majority. With this diffusion of all economic power into the hands of the voters, electoral success becomes dependent upon being able to bribe those voters with other people’s money. Such a practice can only be facilitated by a creating gulf of injustice between haves and have-nots – that such money is unjustly held in the first place, that is has been “taken”, and that the rich must “give back”, etc. But it is from this that the way is paved for the suspicion of all traditional, social relationships, demonising them as products of “oppression” by the “patriarchy”. Indeed, the promulgation of antagonistic identities based on race, gender, sexuality and so on – a centrepiece of the culture war – is largely justified by economic inequalities (real or imagined) faced by these different people.

Moreover, the essentially egalitarian nature of democracy puts it at odds with cultural brilliance. From a philosophical perspective, equal stakes in the public realm must presuppose equal capacity, equal ability and, thus, the equal education of every individual. Cultural achievement, however, is inherently elitist, seeking every greater heights of ability and refinement above that which can be accomplished by the average person.3 Practically, however, as the ultimate power of patronage is divided equally amongst everyone, such patronage will be awarded to that which is common rather than to that which is exceptional. Thus, there might be more than a grain of truth in the cutting remark of Orson Welles’ character in The Third Man:

[I]n Italy, for thirty years under the Borgias, they had warfare, terror, murder and bloodshed, but they produced Michelangelo, Leonardo da Vinci and the Renaissance. In Switzerland, they had brotherly love, they had five hundred years of democracy and peace – and what did that produce? The cuckoo clock.

Finally, democracy also weakens the distinction between the people and their state. For once every action of the state becomes an action of the people, by the people and for the people, then we should not wonder why ancient rights and freedoms are gradually eroded. After all, if the people are the state then aren’t protections from the state – free speech, habeas corpus, double jeopardy, etc. – unnecessary? Why would we need saving from ourselves?

Overall, it is our economic choices that have reduced us to a kind of social, moral and cultural nihilism which has allowed the elements of cultural leftism to sweep in and dissolve whatever remains. Having stripped itself of a solid backbone by accepting the economic foundations of the culture war, the right has been left defenceless against the more absurd extremities to which that war has now pushed us. Indeed, when economic realities are so distorted, it is but a short step to the questioning of all reality and the crumbling of every certainty. The final assault is upon the value of truth itself and the meaning of language. For what could be more disarming to your enemy than the objectivity of his ideas and the means with which they are communicated? In fact, it is precisely because the political means is ultimately parasitic and destructive that it can only ever be sustained by illusions, mirages and outright lies. Unlike private crime, which everyone knows is illicit, we sustain the state because we believe that its aggression is beneficial, even necessary.4 Anti-terrorism, tackling climate change, and now COVID-19 restrictions – all of these have been used as excuses to ramp up state power while disguised as being for the common good. The emperor truly does not have any clothes, but – just as in the fable – we go along with the illusion that he does because we think it is in our interests to do so. Finally, not only does the breakdown of truth, facts and reasoned analysis give way to emotionalism, hysteria, fear, and helpless submission to a protector, but the loss of objectively communicable discourse means that the only solution to any conflict is violence.

The Hitler Legacy

Defencelessness against the leftist onslaught has been compounded by another unfortunate factor that the right has been relatively weak in fighting off, which is the ideas and values that are associated with the “right” and the “left” in the first place. Although we could probably argue until the cows come home over how to distinguish the two, a fair summary is that the right is characterised by a respect for traditional identities, hierarchies, culture, custom, traditions and the “organic” flowering of society, whereas the left derides these elements in favour of openness, egalitarianism, inclusion, secularism, as well as the conscious construction and imposition of values that should drive societal progress. In Fig. A above, it was no accident that “increasing violence” is depicted on the left and “increasing peace” on the right, because we can see that the “rightist” values we just mentioned are coherent when they go hand in hand with increasing freedom while “leftism” is equally coherent when it is coupled with inflating state power.

However, advocates of specific political theories on either the right or the left have not always seen it this way for the reason that logical tendencies are not necessarily ideological ones. In fact, one small blessing for which we can be thankful is that enemies of freedom do not always see themselves as ideologically united, often adopting half-baked political theories that they imagine to be compatible with any attractive goal or value. For instance, the Bernie Sanders/Alexandria Ocasio-Cortez (AOC) wing of the US Democratic Party rails against Wall Street and the Davos crowd as much as any libertarian in spite of the fact that AOC’s “Green New Deal” must ultimately lead to the same kind of concentration of wealth and power as the crony capitalist globalism that she claims to despise. Closer to our own side, there are left-libertarians who detest the state and whose objective is victory for the liberty of the individual; however, they are more likely to view all of the “rightist” values we listed earlier as inimical to freedom, and as tools of oppression and injustice. Hans-Hermann Hoppe has explained the incoherence of this view.

More problematic for us, however, is the fact that some of the most infamous regimes in history have been violently statist while, at the same time, embracing “rightist” values. Taking centre stage is obviously Nazism. Far from being “open” and “tolerant”, the Nazis were fervently nationalist, with German identity, culture, and traditions being central to what passed for their philosophy, even if their definitions of these elements were highly selective and idealised. The traditional family structure, gender roles, and responsible parenting, far from being demonised, were critical for Nazi social policy, while those living “alternative” lifestyles – including gays, gypsies, Jehovah’s Witnesses, prostitutes, alcoholics, and vagrants – often ended up in concentration camps. There was even a special prize – the Mutterehrenkreuz – awarded to “exemplary” mothers who bore four or more babies. It is difficult to imagine something much farther from twenty-first century feminism. Nazi racial policy and the perceived superiority of the Aryan race over Jews, blacks and Slavs – as well as the sterilisation or extermination of the disabled and medically “unfit” – threw any notion of equality to the wolves. Of course, Nazi statism was fully in line with the consolidating and centralising tendencies of the political means – it just wanted to stamp the “superiority” of Germany onto the face of the entire world, whereas cultural leftism, in a no less authoritarian fashion, is trying to hollow out nation states from within.

All of this – wrapped together with the memories of destruction and decimation during World War II – has done an immense service to the left, for it has allowed them to create a false choice between progress and retrogression. According to this narrative, if you opt for globalisation, multiculturalism, open borders, tolerance and egalitarianism – i.e. everything the Nazis would have despised – then you will have world peace. But if you dare to champion borders, traditional culture, traditional lifestyles, national pride and patriotism then it is but a slippery slope to the return of gas chambers and crematoria. Thus, because of this historical association, it has been very easy for anyone on the left to castigate every rightist value as racist, xenophobic, Social Darwinist, destructive and warmongering. This is in spite of the fact that Nazi Germany was the odd man out next to the far bigger, far more murderous and far more consistently leftist regimes of Soviet Russia and Communist China – which, in addition to the need to justify the enormous sacrifice of the World War II, is probably why we only ever learn about the evil of Hitler, rather than of Stalin or Mao. But this false dichotomy has taken hold precisely because the right has lacked a dedication to the fundamental intellectual tools needed to dismiss it.5 This has not been helped by the fact that the mantra of political globalisation – the consolidation and centralisation of political authority across bodies – has become confused with economic globalisation in the form of free trade and the widening of the international division of labour. Thus, in complete opposition to the truth, prosperity and the conquest of poverty have also been tied to the expansion of the political means.

The Second Reassertion of Economic Law

In Part One, we referred to the collapse of direct socialism in the late 1980s as the “first great reassertion of economic law”. In just the same way as an object thrown up into the air must eventually succumb to gravity, so too must any economic system that attempts to ignore economic theory one day come to terms with the results of such a choice. In the words of Ludwig von Mises:

The body of economic knowledge is an essential element in the structure of human civilization; it is the foundation upon which modern industrialism and all the moral, intellectual, technological, and therapeutical achievements of the last centuries have been built. It rests with men whether they will make the proper use of the rich treasure with which this knowledge provides them or whether they will leave it unused. But if they fail to take the best advantage of it and disregard its teachings and warnings, they will not annul economics; they will stamp out society and the human race.6

In the instance of direct socialism, such “stamping out” came in the form of the overt disruption to economic calculation and the lack of entrepreneurship that plagued communist countries. For a complex economy is impossible without market prices, free exchange and ultimately private property, and so whatever life that command economies were able to breathe into themselves resulted from remnants or pale imitations of these elements.

However, as we also explained in Part One, the fall of Soviet communism was neither a victory of capitalism over socialism nor of freedom over tyranny. Rather, the world as a whole had embraced the political means but merely in different forms. Between 1989 and 1991 we saw the ejection of only one, failed form of implementing the political means, but another was left behind – state capitalism, state corporatism or crony capitalism, a method built upon democracy, inflationism and welfare statism. This guise of statism, of the political means, will eventually prove to be just as destructive as direct socialism; the only difference is the path it is taking in order to get there.

It is understandable how, at the time, those dedicated to capitalism and freedom looked upon the collapse of communism in Eastern Europe as a tremendous victory. But even if few went as far as Francis Fukuyama in declaring “the end of history” – that humanity had finally found, in Western liberal democracy, the ultimate form of social organisation – a subsequent failure of introspection coupled with the loss of anti-communist purpose has allowed the post-Cold War Western state to proceed largely unchecked. True enough, the dangers of the steamrollering security state in the wake of 9/11 did not go unnoticed, while the disaster of the Iraq war – at least after the fact – dealt a serious blow to the cult of interventionism, destroying with it the reputations of George W Bush and Tony Blair. Generally, however, the past twenty to thirty years have been distinguished by the lack of any serious, mainstream ideological opposition to the fundamental tenets of liberal democracy.

In the UK, at least, this is not a particularly difficult picture to paint. The collapse of direct socialism made it inevitable that the economic rhetoric of the Thatcher era had to be embraced by the iron lady’s successors: in her own, famous words, “there is no alternative”. But the economic reality that she left behind made possible, both politically and logistically, the Blair government’s commitment to a “Third Way” economy and a distinctly ethical kind of socialism based upon social justice, multiculturalism, reformism, and political pluralism. This would not have been possible if the Tories had handed over a genuine free market as what resulted was essentially the flowering of the severance of money from its anchor of gold that had received its final blow in 1971. This enabled the Labour governed state to privatise, re-regulate and maintain relatively lower tax rates – even celebrating explicitly the private accumulation of wealth – while shifting its source of funding to borrowing and inflation (as well as to debt-shifting gimmicks such as Public-Private Partnerships and Private Finance Initiatives). Indeed, in spite of the Blair government’s relatively restrained fiscal rhetoric throughout its time in office, all of the key measures of government debt and spending have largely risen over the past twenty to thirty years, while the corporate tax rate has consistently fallen. Commenting on its overall spending record, journalist Polly Toynbee declared the Blair era to be “the most redistributive in decades”.7

True enough, the Conservative Party orchestrated many of its own calamities during this time, having trashed its economic credibility on Black Wednesday of 1992 before appointing a succession of relatively weak and unelectable leaders following John Major. Moreover, its division over Europe was only bridged during the early 2000s – and even then this was little more than a papering over that would erode soon after Brexit. However, the Party also lacked any firm ideological basis to challenge what was really a descendant of their Thatcherite heritage, while their image as the “nasty party” made it difficult to make any inroads into the kind of ethical socialism that their own economic legacy had enabled anyway. Thus, there was very little to prevent the New Labour leftists from swelling and remoulding the state in their own idiom – a remoulding which, incidentally, can also be painted as a direct Thatcherite successor. Explicit constitutional reforms initiated around the turn of the century have served to insulate governance from the possibility of a conservative renaissance, including: replacing the naturally more conservative hereditary peers with political cronies in the House of Lords; creating subsidiary administrations in the provinces, allowing the less conservative Scots to pursue more explicitly left-wing economic and social policies without sacrificing the generally leftist influence of Scottish MPs in Westminster; the transfer of the judicial functions of the House of Lords to a new Supreme Court, pushing the British constitution towards a clearer “separation-of-powers” formation and accelerating the expansion of judicial meddling in traditionally political matters; and, in tandem with the latter, the passage of the Human Rights Act 1998, which has served to create a tightening legal straitjacket around the formation, implementation and enforcement of policy and legislation.8 Indeed, there are now so many wide reaching laws that government ministers complain of being unable to make any decisions without being subjected to a judicial review. As we mentioned earlier, this was all compounded by the gradual infiltration of the upper echelons of the government, civil service, police, armed forces, universities and media with cultural leftists, all of whom could be relied upon to make the “right” decisions within the new framework.

The result of this has been to draw all of the major political parties into a numbing kind of centrism in which 95% of the basics were settled while disagreement – in spite of any displays of outrage and hyperbole – has more to do with style, form and emphasis rather than substance. In line with this tendency, Conservative leader David Cameron attempted, in the late 2000s, to restore his party’s electoral credibility under a mantra of “compassionate conservatism”, an approach similar to that of George W Bush. Ironically, however, Cameron’s first shot at an election came in the wake of the 2008 economic crisis which, both practically and politically, left the Blairite model at its weakest. Thus, Cameron’s self-imposed, centrist ambivalence – more greenery than growth – meant that, in addition to being saddled with reliance upon the Liberal Democrats as coalition partners, the post-2010 Tory response to the financial crisis was weak and ineffective. The so-called “austerity” policies affected little more than a fraction of overall government spending, while the social “devastation” they supposedly caused can easily be attributed to the decade’s stagnating growth – i.e. a consequence of not cutting enough. Major drains of public expenditure, such as the NHS, were ring fenced, and while government spending as a percentage of GDP fell, spending as a whole (as well as debt and debt as a percentage of GDP) rose. Even today the Conservatives under Boris Johnson are little more than Blairism plus Brexit.

The general lack of ideological tension has permitted political globalism and the gradual consolidation and centralisation of state functions into supranational institutions to gather pace. This has taken the form either of multilateral treaties and alliances (such as NAFTA and the expansion of NATO) or the creation of explicit international bodies and unions such as the United Nations, the IMF, and the EU. With regards to the latter, the post-Cold War European treaties and the creation of the single currency have transformed a trading bloc into an “ever closer” political and economic union, the logical end point of which is a pan-European super-state.

Globally, it does not seem to have been necessary for every country to have adopted Western-style liberal democracy so long as they have subordinated themselves to its hegemony. For decades the West (led by the US) has been happy to put up with any tin pot dictator or theocratic monarchy that happens to play by its rules, with Saudi Arabia probably being the most significant. The West’s foreign policy forays have generally been fought for reasons of control and influence – either because of direct threats to US financial dominance in the cases of Iraq and Libya, or as proxy wars against Russia, China or Iran in the cases of Syria and Yemen – with the ideological unity of the West serving as a mere pretext. Indeed, it is no accident that, in the year 2000, many of the countries to which the US has directed its ire – Afghanistan, Cuba, Iraq, Libya, North Korea, Iran and Syria – were among the few to have a central bank independent of the Rothschild banking empire.

It is, however, the persistent lack of any distinct ideological tension that has allowed the state to steamroller ahead towards the second reassertion of economic law – the failure of inflationism, welfare statism and, ultimately, of democracy, a failure that is now showing up as a multitude of bursting seams in the cushion of Western liberal democracy.

The first of these reassertions is that increased doses of inflation and credit expansion are no longer able to reignite economic prosperity following the series of malinvestment crises that they have caused. The tech bubble, which saw worthless companies selling for millions of dollars worth of stock, burst in 2000 only to be re-inflated as a housing bubble which produced a similar speculative frenzy in residential property. When this also crashed in 2008, the subsequent bank bailouts and so-called “quantitative easing” have resulted in an even worse “everything” bubble of asset price booms. At the same time, however, wage growth has stagnated, leading to the popular perception that a rigged system is making the rich richer and the poor poorer. Indeed, annual GDP growth rates have been in an overall downward trend in the US, UK and Euro area since the late 1980s.

The growing imbalance of the inflating debt and the increased distortion of real values are now able to magnify the effects of even a relatively minor trigger – such as the cash shortage in the US “Repo” market last autumn – into a crisis requiring ever greater quantities of new money and ever greater amounts of direct intervention from central banks so as to keep governments solvent, interest rates low and asset prices afloat. The alternative would be for the entire financial system to unravel. The medium term result of this may be increasing central bank intervention directly into the economy and, thus, de facto socialisation by the back door – something that has already occurred in Japan where the Bank of Japan has become a major shareholder in half of the companies listed on the Nikkei Index simply through buying shares with printed money. Clearly, this could be used to advance political goals via nominally private corporations, denying funding to those who are insufficiently green or woke while rewarding those who keep in line. The long term result, however, is likely to be the final end of the era of inflationary finance and the destruction of fiat currencies in their present form.

A second problem is that general productivity is increasingly unable to fund all of the commitments that democratic governments have made to their electorates down the years, regardless of whether the source of revenue is taxation, borrowing or inflation. As a consequence, the discretionary portion of government budgets – i.e. spare cash with which politicians can woo their voters with new promises of more goodies – has gradually shrunk, with the lion’s share of government spending being devoted to existing promises and commitments. The present value of these, consisting mostly of healthcare, social security and public pension entitlements, has been estimated at anything between $100 trillion and $200 trillion for the US alone – truly eye watering sums which are driving governments to insolvency.9

Third, the ability of Western economies to print heavily demanded reserve currencies – made possible by the petrodollar system and, for the UK, the global pre-eminence of the City of London – has lent an artificial cheapness to manufacturing bases abroad such as China. The result of this has been the transformation of Western countries into consumer and service driven economies while heavy industry has been shipped abroad. The spoils of growth have therefore been reaped disproportionately by those simply involved in moving money around as opposed to the creators of useful goods and services. In short, as the skyscrapers in London have gone up, the factories in the provinces have rusted.

Finally, in tandem with these economic factors, trans-national co-operation and the deferment of decision making to international forums has meant that policy formation has increasingly become a technocratic exercise for mandarins, lawyers, and scientists far removed from the citizenry. Indeed, this is likely to be one reason why states have responded to COVID-19 in such a strikingly similar fashion. Nowhere, however, is this epitomised more than in the structure of the EU, where the (unelected) Commission fulfils a combined role of executive, civil service and legislative initiator, while the Parliament is reduced to the function of a mere rubber stamp. Particularly when it comes to solving supposedly global problems such as climate change, governments have been content to have their autonomy curtailed by the texts of international agreements and bodies of supposed “experts” (such as the WHO) whose sources of funding, influence and allegiance are open to question. As Sean Gabb has called it, this “blurring of the lines of accountability” has gradually eroded the democratic veneer of legitimacy over governance and shaken the belief that the electorate is ultimately in control of the decision making process.

All of this has provoked rising opposition and backlash from those who feel the impoverishment and the exploitative nature of these failures – an opposition best summarised, ironically, by former Bank of England Governor Mark Carney:

[M]any citizens in advanced economies are facing heightened uncertainty, lamenting a loss of control and losing trust in the system. To them, measures of aggregate progress bear little relation to their own experience. Rather than a new golden era, globalization is associated with low wages, insecure employment, stateless corporations and striking inequalities.

One faction inclined to take this view is the young, middle class millennials. As a result of their state education, these people are likely to remain true to social liberalism, to the climate change narrative and to the ideal of “harmonic” political consolidation in outfits such as the EU. However, many of them will be graduates saddled with student debt that funded useless degrees – victims of the unnecessary expansion of university education and for whom the promise of increased earnings has not been forthcoming. Too young to have any memory of communism but with a keen perception of both economic and social injustice they are likely to be inclined towards a more distinctly economic kind of socialism as the solution. The “Occupy” and “Momentum” movements, the Indian summers of Bernie Sanders and Jeremy Corbyn, and – with their distinctly anti-Western, anti-capitalist stance – Black Lives Matter, Antifa and Extinction Rebellion all owe themselves to the support of these disaffected, middle class millennials.10

A second group consists of mostly older, working or lower middle class people who reside outside of the major centres of political and financial control – i.e. England outside of London, and the Southern and central states in the US. In contrast to the millennials they reject the march of political globalisation, but share the feeling of having been “left behind” by crony capitalist and neo-liberalist economic policies. With a greater sense of alienation from the cosmopolitan political class intent upon throwing open the borders and eroding national pride and traditional values11, it was this group that helped to achieve two major victories: the vote for Britain to leave the EU and the election of Donald Trump as US President upon a distinctly nationalist, “America First” platform.

The shock of these events – opposed by the entire establishment – owed itself precisely to the fact that the preceding political hegemony and its seemingly inevitable march towards a more open, tolerant and globally harmonious future was being hammered by decisive blows of rejection for the first time. Any introspection should have revealed the prior hubris of this attitude, particularly within the EU where the presumptuous conviction of moral superiority over the nation state has always – as David Cameron found out – produced a pompous reluctance to grant any modicum of flexibility or independence. Instead, the paralytic inability of the liberal elites to comprehend any challenge to their worldview has led to a stubborn refusal to accept the viability of these elections, leading in turn to an obsessive, four year crusade devoted to unearthing any scant reason that would serve to de-legitimise and hence reverse the results. In the US, the frenzied fervour dedicated to ousting Trump from office – first by pursuing the myth of “collusion” with the Russians and then a farcical “impeachment” – has meant that the Democrats have failed to craft an alternative, viable message and to rally round a credible presidential candidate for 2020. The most that they could muster instead – almost literally, given Joe Biden’s senility – has been to resurrect the white ghost of the Obama era. In the UK, Brexit voters were told repeatedly that they were lied to, that they didn’t know what they were voting for, or were just plain stupid, while the spectre of a (heavily circumscribed) second vote threatened to cancel or hollow out the substance of the UK’s departure. Through this, the intransigent “Remainers” have succumbed to a cruel but richly deserved irony. For if they had accepted the referendum result and had agreed, with humility, to work towards a graceful exit from the EU, it is likely that the terms of withdrawal would have been relatively “soft” anyway.12 Instead, their decision to fight it has meant that everybody, on both sides, dug in their heels before retreating towards their extremes as time went on. Indeed, by the time of the 2019 general election, it was pretty clear that, regardless of any ifs and buts in the detail, the de facto choice was between completely in or completely out. As of today, the lack of any progress on securing a future trading agreement with the EU means that a “hard Brexit” may well be the most likely outcome.

For the deep state, the economic and political landscape at the opening of 2020 is therefore one of existential crisis, the continued response to which has been doubling down and kicking the can farther down the road. The specific causes of the draconian reaction to what is now, quite obviously, a relatively mild health threat in the form of COVID-19 will have to be worked out by (hopefully unbiased) future historians. Was it a cover for an inevitable economic collapse? Was it all planned in order to tighten the grip of global state authority? Or was it just a blundering overreaction? However, regardless of the weight that could be assigned to each of these possibilities, we can see how each and every one of them has been a continuation and, indeed, an acceleration of the proceeding trajectory.

To put this in greater perspective, consider what might have happened instead if the following had been true:

  • Hillary Clinton won the 2016 presidential election and was now seeking re-election in November of this year;
  • Britain had voted to remain in the EU;
  • Inflationary finance was not teetering on the edge of total destruction and the economy was in a similar state to that of the late 1990s and early 2000s.

Is it likely, in this scenario, that governments would have locked up their content and obedient citizens and trashed a global economy that was seemingly working for everyone? To ask that question is to answer it and, in fact, we already have an explicit example. In 2013 the Ebola outbreak – declared at the time by the WHO to be a public health emergency – could have provided exactly the same opportunity as COVID-19. And yet what was President Obama’s response?

What we’re seeing now is not an “outbreak” or an “epidemic” of Ebola in America. This is a serious disease, but we can’t give in to hysteria or fear.

In hindsight, it is difficult to find a more ironic statement.

Thus – as we suggested in Part One – it is not necessary for us to speculate on the existence of a monolithic, worldwide conspiracy to enslave us all in order for us to explain the deprivations of liberty to which we have been driven. Instead we have seen that the growing preponderance of the political means, dating from the First World War, has spawned a plethora of catastrophes and calamities as economic law has continually sent the chickens home to roost. However disparate, disorganised or merely incompetent they may be, those who maintain ideological adherence to the political means must, by logical necessity, react to these problems they have created by pushing their societies farther towards all of the characteristics that appear on the left hand side of Fig. A.13

The Future

The primary task of this pair of essays has been to explain how we ended up in the situation in which find ourselves in 2020. It would be amiss not to complete this with some words about where we may be heading from here, but predicting the future is a much more difficult exercise subject to too many contingencies. What follows, therefore, is not a prediction so much as a description of outcomes that would be most conducive towards liberty while remaining within the bounds of realistic possibility. In other words, how might the future unfold in such a way as to move us to a restoration of the economic means and away from the political means?

The first possibility is that the perceived threat of COVID-19 will have a limited lifespan in terms of its utility in growing state power. In spite of the extraordinary measures taken in a short space of time, the ability of this episode to accomplish a final crushing of freedom can be doubted.

To illustrate this, consider, as a comparison, the threat of Islamic terrorism, which was the vehicle for the last expansion of the security state at the turn of the century:

  • There was real shock value when planes were flown into iconic buildings on American soil;
  • Being moral agents, terrorists could, in principle, strike at any time and place of their choosing for many years into the future;
  • It could be used to legitimise the subsequent foreign interventions in Afghanistan and Iraq;
  • With the exception of increased hassle with air travel, daily life could mostly continue as before and so state expansion was hidden – people still had their jobs, schools did not close, people could still do what they wanted and the economy was not wrecked;
  • It coincided with the rise of the internet and social media, and so the impetus for spying and intrusion was present before people came to question the risk of their digital exposure.

The winning formula here is that the state could petrify its population while state engorgement was achieved mostly under the radar (or in foreign lands far removed from the electorate). COVID-19 does not present similar advantages. Viruses have always been a fact of life, striking seasonally and following well established patterns. Indeed, in spite of all of the talk of a “new normal”, there is still the general expectation that this is a temporary situation – with even the government itself describing it as a “once in a century” event. Moreover, the reaction has been visible and obvious, with every measure announced in a blaze of publicity. The economic destruction and the perpetual interferences to daily life mean that, in the absence of bodies piling up in the streets, other priorities will eventually come to the fore – such as jobs, and the huge backlog of other serious medical afflictions requiring treatment that has been delayed in expectation of mass COVID hospitalisations that never materialised. The virus itself seems to be fizzling out in spite of the gargantuan effort to reignite its threat through the discovery of “cases” – tiny numbers of highly suspect positive tests that require no treatment and are leading to no significant increases in deaths. There are a number of encouraging signs that people are starting to realise – if only slowly – that COVID-19 is nothing like the Black Death. There have, for instance, been an increasing number of protests defending freedom and contesting the official narrative, while the possibility of masking or otherwise restricting schoolchildren has proved far more contentious than the same for adults – so much so that, in England, face coverings have been mandated for school pupils only in local lockdown areas, with schools themselves taking it upon themselves to impose stricter rules.

However, a more decisive fight back is likely to be reliant on one or both of two things. First, when the “operational” division of the state which can’t simply be bought off – such as the doctors and nurses who actually want to treat sick people, the police who actually want to catch real criminals, and the teachers who actually want to teach – refuse to play ball any longer. Second, politicians themselves may come to see political advantage in exploiting the fallout from the restrictions rather than pushing an increasingly unjustifiable COVID narrative. Indeed, the low profile of Keir Starmer and his Labour Party throughout this entire affair has all the hallmarks of not wanting to interrupt an enemy while he is making a mistake. It is quite possible that the shameless mainstream media – with increased reporting of over-counting deaths and problematic testing as well as other challenges to the prevailing narrative – are gearing up for a Labour led assault on the Johnson government over the consequences of lockdown, probably in tandem with what they are expecting to be a “disastrous” no-deal Brexit. In fact, it would not be surprising if the only reason we are continuing to suffer restrictions in the UK is to make sure that any failure for COVID deaths to rise this winter can be attributed to lockdown rather than to the absence of the disease, thus giving Johnson at least some plausible defence when the consequences must finally be dealt with. Face saving and short term thinking is hardly alien to politicians.

Overseas, the state legislature in Victoria, Australia – which has seen the most tyrannical response to the virus outside of China – has defied the governor by resisting an extension of the state of emergency by more than six months. In the US, where the level of restriction is generally a matter for the states, there has been a marked difference between the responses of Democrat governors on the one hand and Republicans on the other, the former being more restrictive than the latter. Indeed, South Dakota never locked down at all, while Florida premier Ron De Santis has vowed never to lockdown the state again.14 In fact, if there is one “conspiracy theory” which can be endorsed with little reservation, it is the use of COVID-19 restrictions in order to try and influence the forthcoming presidential election. Democrats, having already demonstrated their anti-Trump desperation, clearly have an interest in wreaking the economic destruction which the restrictions will cause, given that the economy, traditionally, has been the key factor in determining an incumbent president’s likelihood of re-election. Moreover, this fits quite neatly into the Democrats’ support of the Black Lives Matter/Antifa narratives and the subsequent rioting and looting, painting America under Trump as a racist, oppressive and divided hellhole which is literally burning to the ground. Needless to say, this strategy may well backfire, but should it be doubted consider again whether all of this would have happened if a Democrat was seeking re-election rather than Trump. Whatever happens during the election – and it may prove to be a bitter and unsettled contest – it would not be surprising if the political utility of the COVID narrative begins to dry up once the ballots have been cast.

It should be remembered that states have always been able to inflict impoverishment while promising prosperity, but selling impoverishment directly on a long term basis is much tougher. Real and long lasting tyranny is more likely to arrive either in the disguise of freedom or insidiously through the back door. Indeed, if the state’s string pullers are harbouring a grand plan to vaccinate and barcode every citizen then is this likely to be achieved under a glaring spotlight? Why do it in such a way that will not only create too much of an impetus to find alternative solutions (e.g. hydroxychloroquine) which must then be systematically discredited but is also tantamount to proving “conspiracy theorists” right? In short, why risk inviting the maximum amount of possible resistance? Rather, if the powers that be are, indeed, following a schematic rather than blundering around in mere desperation, the most that may be achievable in the long run is to have “tested” our complicity – seeing how far the line can be pushed and how many false flags can be flown before provoking a rebellion. Thus, the real value of the virus hysteria is likely to be the precedent that is set for a future “disaster”, with the formal, legal apparatus and increased state power remaining in principle.15 Some permanent hangovers may be a greater movement towards the elimination of cash transactions and, perhaps, some “distancing” regulations or limits on gatherings may stay explicitly in place. Indeed, the latter has had the convenient effect of outlawing the “wrong sort” of mass protests, in much the same way that anti-terrorist legislation has proven malleable enough for the state to spy on anyone from journalists down to noisy children. But we should also mention some good aspects. For instance, may be home schooling and a wider rejection of state indoctrination of children will become more prevalent, particularly if schools remain as shrines to sterlisation and sanitation rather than to education. A long term change to working practices is more questionable. Smart white collar workers will be hesitant to jump on any home working bandwagon for the reason that, in principle, a job that can be done on a laptop from your kitchen table is a job that can be done from India or China. Nevertheless, could we be seeing an accelerating exodus from leftist controlled cities?

The longer term problem is the resolution of the clash between the doubling down of a drive towards a greater preponderance of the political means on the one hand and the backlash fuelled by a reassertion of economic law on the other. How might this play itself out in such a way that is favourable to the restoration of liberty?

One prospect is that, at least in the UK, whatever vestige there is of the political right may have finally realised that precisely who happens to be at the helm of the state is an irrelevance and that, thus, trying to reform or remould the state by electing “better” leaders is a waste of time. For the first time in recent memory the British people endorsed a Prime Minister who gave the appearance of being neither a natural authoritarian in the style of Thatcher, Brown and May nor an oily salesman like Blair or Cameron. All of Boris Johnson’s credentials as a journalist and an underdog politician have suggested that he would refuse to react to alarmism or capitalise upon flimsy pretexts – and yet he has overseen the most dramatic destruction of liberty this country has ever seen. He might well be a charlatan or simply incompetent, but it is just as likely that he has been corrupted by the office which he now holds. The poisonous influence of the reins of power upon even the purest of minds has a long history to which not even Thomas Jefferson was immune. True enough, there might, in the near future, be a political opening for a traditionalist and patriotically British/English political party in Westminster (although precisely who has the credentials to lead such an outfit at this time is more of a mystery). But the enormous disappointment of Boris Johnson should make clear that the only realistic way forward in order to temper the state is to shrink its size and structure – i.e. by decentralising its power as much as possible.16 Centralised power in the hands of ostensibly good people is not enough – nobody should have that kind of power.

In fact, the “crisis” itself has shown directly some of the benefits of decentralising decision making authority; indeed, the virus may well have lent us the closest thing possible to a controlled experiment in “testing” different state responses to a common problem. The general result seems to be little to no correlation between the severity of lockdown and the progress of the epidemic – the only difference is who has wilfully inflicted the most amount of unnecessary economic and social damage. This knowledge would have been denied to us if we had instead been under the aegis of one world, or fewer governments. Moreover, we can be thankful that some of the most absurd responses – such as in Victoria, Australia – have been confined to relatively small territories rather than unleashed upon the entire globe.

Fortunately, there may be some movement in the decentralising direction, a few words on which will conclude this essay.

First, the provinces of the UK are beginning to assert more independence and have tailored their own responses to the COVID-19 outbreak. Both government and the mainstream media refer increasingly to “the four nations”. It would not be a bad thing if this was to drive us towards full political independence for England, Scotland, Wales and Northern Ireland. Moreover, the greater emphasis on tailoring responses to specific regions – such as “local lockdowns” as opposed to the London-centric uniformity that was imposed back in March – may create a demand for more regional governance over other areas of policy, particularly when the repercussions from the lockdowns are more keenly felt.

Second, the crisis has shown the weakness, ineptitude, and the lack of unity within the European Union. In spite of the insufferable Remainer propaganda we have endured for the past four years, once the s*it hit the fan, borders and national priorities suddenly became relevant again, and many of the EU’s rules and restrictions were simply ignored so that states could react to the pandemic in ways that they wanted. Hopefully, this may place more member states onto the path of secession, and it would probably only take one significant member, such as Italy, to unravel the entire thing.

Finally, the division in the US – likely to persist well beyond the presidential election – may end up being resolved by the secessions of major states or groups of states. This is facilitated by the fact that ideological division is largely geographic. It would, therefore, be quite possible for the Pacific coast states and the North West to secede from the central states and the South, creating at least three independent countries.

Ideally, geographical secessions should be accompanied by financial secessions also. Libertarians would, of course, prefer to see the full restoration of commodity money chosen by the market. But in the unlikelihood of any state entity wishing to rescind its control over money, the next best thing is to prevent any state currency system from achieving dominance.17 Globally, China and Russia are attempting to decouple from dollar based financial networks. Closer to home, the demise of the EU and the euro could see the restoration of national currencies, while seceding states in the US could also reject the depreciating dollar. With regards to the latter, the recent opening of the Texas Bullion Depository may be a stepping stone towards such an outcome.

How soon all of this could happen is difficult to say. But our era of inflationary finance has already outlived direct socialism by thirty years; it might not have very long left. Indeed, timelines tend to shrink towards the end of a crisis, with outcomes that previously took years appearing in months, months in weeks, and weeks in days – and 2020 has shown this in spades. The path forward is unlikely to be without a great deal of pain. But as economic law is on the side of liberty, either the state must eventually relent or face the consequences of a bigger backlash if it continues to tighten its grip – a backlash that could lead to the rejection of the modern nation state in its entirety.

*     *     *     *     *


1Alternatively, Cultural Marxism, Gramsciism, or whatever you want to call it.

2Indeed, it is precisely because it is a mere tool that the preoccupations of cultural leftism promote only disunity, discord and antagonism rather than a genuine, alternative vision.

3In fact, the elitist aspect of great cultural achievements is limited to the talent required for their creation – i.e. they should be difficult to make but they should not necessarily be difficult to appreciate. None of us mere mortals has anything approaching the talent of, say, Michelangelo, Ludwig van Beethoven, or Jane Austen, but even an individual unrefined in taste and connoisseurship can gasp in awe at the splendour of the Sistine Chapel, be roused by the Eroica, or devour Pride and Prejudice. In contrast, much “modern art” – like some of the monstrosities that have polluted Trafalgar Square’s Fourth Plinth – seems to be the precise opposite: easy to achieve but difficult to appreciate, thus managing to be both talentless and elitist.

4“[F]iction or illusion is precisely what distinguishes governments from ordinary aggressors […] [P]eople believe [state] aggression to be useful in respect to purposes different from those of mere exploitation […] that aggression is necessary to produce certain goods.” Jörg Guido Hülsmann, Toward a General Theory of Error Cycles, The Quarterly Journal of Austrian Economics, Vol. 1, No. 4 (Winter 1998): 1-23, 10.

5Such false, binary choices are, incidentally, part and parcel of state propaganda, although they are rarely quite as explicit as President George W Bush’s post-9/11 claim that “either you are with us or you are with the terrorists”. Some more recent examples: if you are against Black Lives Matter you are racist; oppose feminism you are a misogynist; a climate change sceptic you must want to destroy the environment; refuse to wear a mask or social distance and you must want Granny to die.

6Ludwig von Mises, Human Action: A Treatise on Economics, The Scholars’ Edition, Ludwig von Mises Institute (1998), 881.

7Quoted in Andrew Taylor and Adam Bronstone, People, Place and Global Order: Foundations of a Networked Political Economy, Routledge (2019) (page numbers unavailable).

8Curiously, the Act seems to have been much easier to invoke in cases involving the rights of terrorists, criminals and illegal immigrants than against the blanket abolition of basic liberties in response to COVID-19.

9Indeed, this is one of the reasons why the political battleground has shifted from fiscal issues and onto social and cultural issues – from the redistribution wealth to the redistribution of status.

10Thus, the corporate state maintains a strange relationship with this faction, wanting to capitalise on the disaffection with regards to climate change and social justice while simultaneously needing to ensure end the narrative in their own favour.

11With leftism today being identified so distinctly by its cultural preoccupations, it is easy to forget that the traditional working class element of the left is likely to be relatively socially conservative – not necessarily in the sense of being church going, pro-marriage or puritan, but enough so that the wokeish obsessions of the cultural left will fail to resonate with them. Moreover, trade unions have historically been among the fiercest opponents of liberal immigration policies. Both the Democrats in the US and Labour in the UK have found it difficult, in recent years, to unite their middle class liberal and working class wings.

12The chief “boobus remainus” in this regard is probably Gina Miller. Had she not launched a judicial review of the government’s prerogative to trigger Article 50 – the clause in the Lisbon Treaty which grants a right of withdrawal to the EU’s member states – it is likely that Theresa May’s government would have concluded a relatively soft Brexit deal unilaterally with the EU. Instead, the outcome of the case led to the inflated role of Parliament and the subsequent gridlock which eventually resulted in Boris Johnson’s mandate to pursue a much harder Brexit in 2019. Interestingly, for all of her purported concern for democracy and parliamentary sovereignty, Ms Miller has been noticeably absent while the government has dissolved very real rights and freedoms through the use of statutory instrument during COVID-19.

13In fact, the simplest explanation as to why the threat of the virus was exaggerated and the whole world went into lockdown was probably to emulate the response of Chinese state, which Western leaders are likely to gaze upon with envy as the ideal model of corporate governance, ruthless dictatorial control and a seemingly obedient population. Thus, the Western world, in its turmoil, saw a heavy handed response as a way to reassert its authority. In the words of one commentator:

It is interesting that the outbreak of this novel coronavirus has resulted in a worldwide panic drowning out [anti-state] factors, prompting even the doubtful to once again encourage their peers to trust the state for leadership. This is not to assert that the virus isn’t a threat, or that regulators “planned” its release. It is simply to note that politicians and financial planners have historically leveraged such situations to implement new — and often highly intrusive and unethical — policy, and openly admit to doing so. At times, even desiring disaster. With this knowledge at the forefront, it becomes understandable some are connecting the dots.

14Italy – initially one of the hardest hit countries – has also said the same thing.

15And even this may be denied to them if the coming winter more firmly shows the state to have cried “wolf” over COVID. Memories of overreaction and hysteria may weaken any willingness to succumb to similar restrictions in the future, whatever the crisis. It is not unknown for public pressure to rescind government power following states of emergency. For some examples, see Brian Martin, Politics after a Nuclear Crisis, Journal of Libertarian Studies, Vol. IX, No. 2 (Fall 1990), 69-78 at 76. Thus, COVID-19 may even end up being an own goal for the state.

16In any case, should the silent majority continue to vote “the wrong way”, it would not be surprising if the next great assault is upon democracy itself – a tough objective for the state, given that the perception of its necessity is immovably entrenched, but we should be prepared for the present effectiveness of voting, however limited, to be curtailed in one way or another in the near future.

17Indeed, in many ways, the dominance of the US dollar and dollar based financial networks has been the financial equivalent of liberal democratic hegemony.


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