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Leftists, Liberals—and Losers? (cont’d)

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The importance of an alternative economic vision cannot be overestimated in understanding the success of past movements for progressive social change, especially in energizing left-wing activists.

Socialism was once such a vision, with a foundation in government ownership of the means of production and centralized planning. But the past 60 to 80 years have shown that this alternative cannot work in an egalitarian and democratic way. Even if government planners had enough information and the technocratic capacity to generate an optimal plan, and if democratic pressure was able to keep the bureaucracy from becoming elitist–two big ifs–the process would end up hierarchical and nonparticipatory. That’s because information goes upward and orders and commands flow downward in such a system, as the libertarian socialist economist Robin Hahnel shows in his seminal book Economic Justice and Democracy (2005).

The failure of socialism worldwide has left egalitarians without a vision of a better economic model since the 1980s. But the implosion of the American economy demonstrates that a free-market approach is deeply flawed, and those who continue to put their faith in the market are as delusional as their counterparts who support central planning.

I suggest leftists think in terms of a fact that has been overlooked until recent years. Markets can be socialized to serve collective purposes by using four well-known policy tools as carrots and sticks: subsidies, taxes, government purchases and regulations. That is, there can be conscious and planned interventions in the market in the name of greater equality and participation. I contend that this is a form of planning that makes use of markets even though some of their more dangerous qualities would not be fully tamed. It is a form of planning that the current American government has the power and experience to institute through Congress and a variety of government agencies.

The best example of how the government currently shapes markets concerns the annual battle in Congress between heavy industry and environmentalists over energy policy. Environmentalists call for higher taxes on fossil fuels, subsidies for renewable energy sources and regulations that force automobile manufacturers and utilities to burn fuels more efficiently and cleanly. The oil, coal, automobile and utility companies demand low taxes on fossil fuels, subsidies for fossil fuels and minimal or no regulations relating to efficiency or pollution, which in effect is a very different plan. If the environmentalists’ plan were to prevail, the United States could gradually wean itself from foreign oil and clean up the air and water at the same time.

The answer is not to be found in economics, but in politics. It is a matter of who has the power. Once the left accepts that there will be markets and private property, all the talk about the sanctity of markets become a rationale elites use to maintain their privileges.

Taming the market through collective action is the basic strategy of living-wage campaigns, which use laws to force employers to pay higher wages. Laws regarding affirmative action, sexual harassment and discrimination also operate through the market. The real issue, again,is political power.

A reconstructed market system–featuring a more progressive tax structure, higher inheritance taxes and a transaction tax on financial trades –could be much more open and flexible than the one that currently exists in the United States. For example, it is possible to have many different types of enterprises compete in the market, not just privately owned corporations. There could be a combination of cooperatives, state-owned companies, and private companies–a “mixed enterprise system,” to recycle an old phrase.

Although this program does not build on libertarian socialists’ economic ideas, in which markets are eliminated, it does fit with their emphasis on the need for socialists to work within reformist coalitions to help move things in a leftward direction. If their political approach were adopted by all leftists attracted to a form of socialism, then everyone, including liberals, could be focused on winning the power to legislate the changes that might make more radical change more attractive to voters further down the line.

For now, it’s time for leftists to think in terms of a new vision: socializing and taming markets through many different types of government interventions.


Social movements use an “us” vs. “them” framework to mobilize opposition to existing power arrangements. However, any framing of “them” that uses categories from which individuals cannot escape–social class of origin, race, gender or sexual orientation–is a mistake that creates a self-fulfilling prophecy and overlooks the possibility that people can change their minds.

Although the power structure in a capitalist society revolves around classes and class conflict, it does not follow that political conflict should be framed in terms of social classes or class struggle. Political conflict should be framed in terms of values, coalitions and power–not class.

Again, the civil rights movement provides a model. The enemy was defined as racists and bigots, not whites in general. The movement was able to use the Christian concepts of forgiveness, redemption and conversion in the service of strategic nonviolence to forge a black/white coalition. Thus people were able to change their attitudes and join the movement. They weren’t excluded on the basis of being white.

Since a cross-class coalition is necessary to assemble a majority for an egalitarian economic program in the 21st century, it is better to begin with a political framing of the “us” vs. “them” issue that does not define one class or another as the enemy. Instead, the opposition should be all those who favor pro-corporate policies and fight against the program of the liberal-left alliance. If the conflict is framed in this way, a liberal-left alliance has a chance to win over the moderates, neutrals and independents who currently identify with corporate capitalists. It might even attract dissident members of the capitalist class who transcend their class interests, and in the process help legitimize the movement to those in the middle who are hesitant to climb on board.


It is my belief that today’s liberals might find this framework a useful one for their own purposes. They might agree that the energy and dedication leftists bring to the alliance through their social movements help to make possible what later become liberal legislative victories. They also might agree that it would be a fair trade to accept competition in Democratic primaries from leftists if leftists completely abandoned potentially divisive involvement in third parties and put some of their energies into regular elections as well.

Based on the past liberal emphasis on the importance of private property and minimal government interference in the workings of the economy, taming the market in a major way through government intervention, along with public ownership of some enterprises, might be difficult for many liberals to accept. However, as the liberal sociologist Douglas Massey forcefully argued in The Return of the “L” Word (2005), markets should be very heavily “policed” by government. His argument is noteworthy because it suggests a narrowing of the gap between leftists and liberals when it comes to creating a more egalitarian economy through government intervention. Moreover, many modern-day liberals agree to a mix of ownership forms as long as there are clear protections for private property.

None of the points in this article is original, but they add up to a program that has never been tried, a program that many liberals might support. It unites electoral and non-electoral strategies, bypasses the structural impossibilities of third parties and non-market centralized planning, reaffirms the importance of social movements, and provides an “us” vs. “them” framing that allows people to change their minds and thereby join what could become a new majority.

Today, the large bloc of Southern and rural non-Southern Democrats that stopped or moderated liberal initiatives in the 1930s and 1960s is down to a nub in Congress. Unemployment and foreclosures are predicted to remain high for at least two years due to an economic crisis that may not be solvable without liberal economic policies that will involve increasing government intervention in the economy. The unnecessary and unwinnable war in Afghanistan is causing increasing casualties and will cost trillions of dollars if it continues for very long. The high expectations created by the election of Barack Obama and large Democratic majorities in Congress are dissipating rapidly. And Americans know from experience–and a look at other countries–that many changes in the economy can be carried out democratically and without loss of freedoms.

Liberals and leftists have had new opportunities in the past, but they never have had one this good. 

G. William Domhoff is the author of Who Rules America? and The Power Elite and the State. He lives in Santa Cruz, where he is a sociology professor at the University of California.

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