November 30, 2010 / Theology
This essay is neither for nor against Glenn Beck. The philosopher Michel Foucault warns us …
Gary Dorrien, the Reinhold Niebuhr Professor of Social Ethics at Union Theological Seminary in the City of New York, has penned groundbreaking works on the history of social ethics, appeared with Bill Moyers to discuss the economic crisis, and been hailed as the hope of American liberal theology. In the midst of a diverse but fragmented tradition, Dorrien is largely unique for continuing to address and incorporate the various streams of American liberal thought, both past and present, in a cohesive direction. In this interview, Dorrien discusses the contemporary economic crisis, Michael Hardt and Antonio Negri’s economic perspective, and constructive theological responses to empire, including the implementation of his own theories of economic democracy.
The Other Journal (TOJ): You strongly promote economic democracy in Reconstructing the Common Good and in your new book, Economy, Difference, Empire: Social Ethics for Social Justice, but you’re a social ethicist and a theologian. You do not have a great deal of company like you, do you?
Gary Dorrien (GD): Precious few theologians or even social ethicists have devoted enough attention to economic theory and policy to write very much in this area. John Cobb, more than twenty years ago, realized that it was pointless to go on writing about environmentalism without learning about economic alternatives, so he teamed with Herman Daly to write For the Common Good, a major work in the field. Sallie McFague realized the same thing about her work in ecofeminist theology near the end of her teaching career at Vanderbilt, and the first book that she wrote afterward, Life Abundant, had a stronger economic dimension than her previous work. Among liberation theologians, Franz J. Hinkelammert and Ulrich Duchrow have long worked in this area, in their case from a neo-Marxist perspective. The books that I’ve written on economic democracy do not have many theological interlocutors, but there are plenty of political scientists, political philosophers, political economists, and policy analysts working in this area, plus social justice activists.
TOJ: What do you think of more current work in the area?
GD: Some of the most creative current work in this area focuses on empire, often as a response to the works of Michael Hardt and Antonio Negri. The new book by Nestor Miguez, Joerg Rieger, and Jung Mo Sung, Beyond the Spirit of Empire, is an excellent example. It emphasizes the anti-imperial spirit of the gospel in welcoming the poor, the oppressed, and the dispossessed to the banquet, a biblical symbol of what the authors call laocracy.
Hardt and Negri contend that globalization has rendered old forms of imperialism obsolete while creating a new form of global sovereignty based on the network power of transnational corporations, nation states, and other powers. The new empire is like the classic one in prizing a universal order that accepts no boundaries or limits, they argue. It is new by virtue of its capacity to transform sovereignty into a sprawling, global system of diffuse national and supranational institutions. Modern imperialism was about extending the sovereignty of European nation-states beyond their boundaries. Postmodern empire establishes no territorial center of power, it does not rely on fixed boundaries, and it incorporates the entire global realm within its expansive ruling apparatus.
I think this is half right, but the half that is wrong has a pronounced tendency to strangle political agency. There is a weird convergence between postmodernized radical theory and neoliberal theory about the nature of the capitalist beast. The point of neoliberal theory is to delegitimize political attempts to channel economic forces, but theories of the Hardt and Negri type do the same thing, albeit for “radical” reasons.
Textbook neoliberal theory says that economic globalization—the integration of national economies into the global economy through trade, direct foreign investment, short-term capital flows, and flows of labor and technology—has flattened the world, so learn how to compete or get run over. There is no third way in political economy anymore; there isn’t even a second way. Any nation that wants a growing economy has to wear what Thomas Friedman calls the “golden straightjacket” of unleashing the private sector, minimizing government, deregulating capital markets, and allowing direct foreign ownership and investment. Once a nation takes this path, politics doesn’t really matter.
Hardt-and-Negri types wail against this situation, while describing it very similarly. But in both cases the theories overlook that governments played huge roles in setting up this system, defending and perpetuating it, deciding whether or not to regulate it, and dealing with its implications for equality, trade agreements, human rights and the rights of workers, immigration, and the environment. Some nations do better than others in dealing with these issues, but for twenty years, the bestselling books in this area told us to forget about politics and changing the system. They exaggerated the futility of political attempts to channel economic forces. On the neoliberal side, they were far too credulous about the self-correcting capacities of the market, which supposedly made it unnecessary to regulate financial institutions. Then came the crash of 2008, and in two months these same supposedly obsolete governments coughed up $12 trillion to save capitalism from itself.
Hardt and Negri say that any hope of a radical social democratic politics was shredded by the high tide of globalization in the late 1990s, so academics and policy wonks stampeded to liberal cosmopolitanism. Liberal cosmopolitans like David Held and Mary Kaldor view globalization as a generally good thing that, with a bit of liberal management, fosters democracy. In their view, globalization can be a powerful force for progressive change because it enhances economic growth, it encourages nations to get along with each other, and it liberates individuals and groups from the rule of nation-states. In foreign policy, liberal cosmopolitans support using and strengthening multilateral institutions. If the tides of globalization are too powerful to be restrained or channeled, and if war has become a perpetual fact of life no longer confined to interstate conflicts, the best hope for progressive anti-imperialists may be a cosmopolitan liberalism that builds on the best aspects of globalization and strives for a democratic world government.
Hardt and Negri take you to the brink of that verdict and then say, wait, there is still hope for something else: a movement for radical, bottom-up, participatory democracy on a world scale. They call it “the possibility of a unified global people.” They envision a global multitude of postmodernized hybrid identities creating a new world society through its various engagements with and struggles against empire.
This is a politics of the motley crew expanded to a global scale. It informs some of today’s best antipoverty and antiglobalization movements, which prize unruly protest and disrupting normal flows in public space. It holds a utopian vision, and it is very much in line with the vision expounded in Beyond the Spirit of Empire, which renames the liberationist option for the poor as “laocracy.” Laocracy is about privileging the most neglected sectors of society, Miguez/Rieger/Sung say. It is not a system of government or a way of structuring power. The laocratic moment is the unexpected presence of the beggars at the banquet.
This option for the excluded is fundamental to the gospel, in my view, as it reflects the teaching of Jesus. The utopian aspect, though always problematic, is also biblical. We are capable of imagining the laocratic, the multitude, the motley crew as a long-term social-ethical project only because it is already latent in our social existence. We can only hope to realize it because it already exists as a real potential. It has a double temporality: always-already and not-yet, an analog of the commonwealth of God.
But as a strategy, motley crew leftism is fragmented, lacking social justice organizations and strategies that scale up. Meanwhile, we still have really existing national governments existing under globalization. There is no structural substitute for democratizing economic power, which means that there is no substitute for the old-fashioned socialist concerns with breaking up economic oligarchies and democratizing the process of investment.
I am against giganticist analyses that sound radical but which strangle political agency. World systems theory has that problem and so does the variation of it that Hardt and Negri have made famous.
TOJ: And here enters the solution you argue for, a democratic economy? What does this accomplish? And what about the economic crisis?
GD: Economic democracy is about giving substance to the principle of self-determination for all people. It extends this principle across all sectors of social existence, including racial and sexual justice, and refuses wars of empire and aggression, forging a common ground for social justice movements. It is not as wild as the Hardt and Negri vision of postmodernized multitudes discovering and producing their oneness on the way to global democracy. And it is more inclusive and constructive than merely holding fast to the liberationist principle of privileging the excluded.
Economic democracy extends the values and rights of democracy into the economic sphere. It is about democratizing power and creating environmentally sustainable economies. In its full-orbed version, it features mixed forms of worker, community, and mutual fund or public bank enterprises.
I don’t believe that the factors of production trump everything. But I do believe that those who control the terms, amounts, and direction of credit play a huge role in determining the kind of society that everybody lives in. We are getting a dramatic demonstration of that today. Gains toward social and economic democracy are needed today for the same reason that political democracy is necessary: to restrain the abuse of unequal power.
Today the big banks are holding about $2 trillion of toxic debt. But their bailouts have made them feel better. They don’t want to be regulated, and they’re back to gambling in the swaps market, which pays better than making boring investments in the real economy. The financial reform bill that passed in the US Congress last summer has some good things in it. It puts most derivative trading on an open exchange and proposes not to bail out anymore zombie banks or financial institutions. But it’s loaded up with carve-outs and exceptions on derivative trading; it houses the new consumer protection agency in the Federal Reserve, which is very friendly to the big banks; and it takes a pass on the biggest problem, that the biggest banks are too big.
Today the six largest banks in this country control assets totaling 65 percent of the nation’s gross domestic product. Fifteen years ago that figure was 18 percent. That’s the path we are on. These same banks control 95 percent of the derivative trading. The big banks have grown fantastically large, and very rapidly, and now their bailouts have made them even bigger.
Eighteen months ago the Obama administration was talking about creating a “bad bank” to soak up the toxic debt. That sounded ominous, so Timothy Geithner opted for an “aggregator bank” that bribes investors to buy toxic debt. If we can do that, we ought to be able to talk about creating publicly financed good banks to do good things. Public banks could finance start-ups in green technology that are currently languishing and provide financing for cooperatives that traditional banks spurn. They could be financed by an economic stimulus package, by claiming the good assets of banks seized by the government, or both.
Today the only state in the United States that isn’t reeling from the credit crunch, North Dakota, is the only state that owns its own bank. North Dakota has its own credit machine, making it less dependent on Wall Street than the rest of the country. Currently, there are significant movements to establish state banks in Massachusetts, Washington, Illinois, Michigan, Virginia, Missouri, New Mexico, and Vermont. If half of these movements succeed, that will be a huge step in the direction of economic democracy.
There are significant differences between the South Korean and Indonesian crashes of 1997, the Malaysian crash of 1998, Japan’s lost decade, the recurrent crashes in Russia and Argentina, and our current meltdown. But they all have in common the most important thing: a financial oligarchy that rigged the game in its favor, built an empire on debt, overreached in good times, and brought the house down on everybody. When the house collapses, elites do what they always do: they take care of their own. To get a different result, a nation has to take control of the problem and break the grip of the oligarchy. Otherwise, you muddle along in a lost decade of your own, further entrenching the oligarchy.
If we democratize economic power and the process of investment—expanding the cooperative sector, investing in full employment and green technology, strengthening social market sectors that serve the needs of communities, and creating public banks and new forms of socially owned enterprises—we get better choices.
TOJ: You’ve mentioned a vision of what economic democracy is for, but what steps are necessary for economic power to be democratized?
GD: On democratizing economic power, the essential things are to expand the worker-and-community cooperative sectors wherever they exist and don’t exist, support the emerging movements for public banks, and cut the big banks down to not-too-big-to-fail size. On top of that, we need to ramp-up the discussion about forms of decentralized socialization that are more entrepreneurial and better at scaling up than worker owned firms. Mutual fund models, for example, establish competing holding companies owned by equity shareholders, the state, and/or other cooperatives in which productive capital is vested. The holding companies lend capital to enterprises at market rates of interest and otherwise control the process of investment. A mutual fund model could be established by an annual tax on major company profits that is paid in the form of stock to regional mutual funds controlled by worker and consumer representatives. Or one could begin a public bank by salvaging the better parts of banks taken over every Friday by the government—currently we’re averaging about four per Friday. There are many ways to establish or configure democratic enterprises, but the crucial thing that we’re currently lacking is a movement or network that links the many existing experiments in economic democracy to each other. We don’t have organizations that link economic democracy activists and professionals to each other, and that is crucial to moving from the scattered projects that exist now to a real movement.
TOJ: You’ve mentioned laocracy and empire, so how exactly does the state factor into achieving change in the economic sphere?
GD: On the role of the state, I accept the principle of subsidiarity, that a problem should be addressed at the lowest level of authority or organization that is commensurate with the problem. Certain kinds of problems, such as fixing ozone damage or reducing greenhouse gases, require international treaties. Dealing with pollution, global warming, genetic diversity, and marine ecosystems requires action on every level, from local and state to national and transnational organizations. Cutting the big banks down to size or guaranteeing health coverage for all are national government concerns, and at this point, dealing with the big banks has become a problem requiring transnational cooperation. Issues concerning food, shelter, livelihood, personal fulfillment, and the building of healthy communities are best dealt with on a community and regional basis.
TOJ: In the end, for you, economic democracy’s move for justice says what about itself, capitalism, and ecology?
GD: Cooperative economics and ecological sustainability are naturally linked by the necessity of creating structural alternatives to the capitalist fantasy of unlimited growth. The economy is physical. There are physical limits to economic growth. Everything on the planet that is frozen is melting at a shocking pace. The kind of economic development that favors the needs of poor and disenfranchised communities and that does not harm the earth’s environment requires a dramatically expanded cooperative sector and a new sector of mutual fund enterprises that are rooted in communities, committed to survival, and prepared to accept lower returns.
TOJ: Any concluding thoughts?
GD: Given that the basic idea of economic democracy goes back, in my field, to the social gospel movement and the founding of social ethics, I try to get as much mileage as I can out of the social gospel, despite the multitude of criticisms that I have of the social gospel’s sorry record on racial and gender justice, nationalism, and cultural chauvinism.
And despite something else that cuts the other way, the social gospelers thought they were riding the wave of history. That conviction makes them hard for us to relate to or even imagine. Today we are living amid the utter triumph of corporate capitalism. Two years after their bailouts, the big banks are bigger and more powerful than ever. And they’ve gone back to doing what they did to cause the crash, because they are geared for one thing—accruing as much wealth as possible with as little interference as possible. You have to be an awfully stubborn type to hold out against that, much less to organize against it. I am looking for the stubborn types to grow and to do a better job of organizing.
 Hardt and Negri are best known for their work Empire (Cambridge, MA; Harvard University Press, 2001).
 Thomas Friedman, The Lexus and the Olive Tree: Understanding Globalization (New York, NY: Farrar, Straus and Giroux, 1999).
 Hardt and Negri, Multitude: War and Democracy in the Age of Empire (New York, NY: Penguin, 2004), 306.
David Horstkoetter is a doctoral candidate in systematic theology at Marquette University. He completed his MA with Gary Dorrien at Union Theological Seminary in the City of New York. Horstkoetter’s interests include history, social ethics, and systematic theology. He also likes to take pictures and drink good beer.
Gary Dorrien is the Reinhold Niebuhr Professor of Social Ethics at Union Theological Seminary in the City of New York. His most well-known books include SOUL IN SOCIETY: THE MAKING AND RENEWAL OF SOCIAL CHRISTIANITY, his historical trilogy AMERICAN LIBERAL THEOLOGY, and his history SOCIAL ETHICS IN THE MAKING: INTERPRETING AN AMERICAN TRADITION. His latest book is ECONOMY, DIFFERENCE, EMPIRE: SOCIAL ETHICS FOR SOCIAL JUSTICE.