As prison and jail admissions have decreased around 25% from their late-2000s peak, private prison companies have begun to invest heavily in “alternatives to incarceration”, such as probation facilities and GPS monitoring (a form of control which has increased 70% in the past twenty years and has become a $6 billion industry). These “alternatives” are presented as more humane, and cheaper, ways of managing criminalized populations. However, as the Moratorium on Deportations Campaign notes, these “alternatives” are linked “to a much broader process of expanding, informationalizing, and generalizing the prison … When the prison is everywhere, it is also invisible as the new form of social reality.”
To understand democracy — to defend it and to deepen it — we should examine its long history rather than obsess about recent headwinds. In a recent article published in the American Journal of Sociology, I attempt to do just that. My research suggests that democratic progress over the last 150 years is the fruit of the changing character of class struggle over the state. Democracy has its origins in the capacity of the poor to disrupt the routines of the rich.
Contrary to Professor Kotz’s view that “the usual profit mechanism that drives accumulation no longer works in the normal fashion,” it is doing just that.
The neoliberal growth model generated intensifying contradictions over time. Household debt rose rapidly, eventually becoming unsustainable. The debt of financial institutions rose even more rapidly, giving rise to increasing financial fragility. Highly risky mortgage-backed securities spread throughout the financial system. The system became increasingly vulnerable to the inevitable deflation of an asset bubble. When the giant real estate bubble of the 2000s deflated in 2007, the major banks became insolvent. Households were no longer able to borrow and had to cut their consumer spending. Corporate managers slashed investment spending. The Great Recession and Financial Crisis had begun. The rate of profit in the U.S. bounced back quickly after 2009. In the following years it reached the highest level of the neoliberal era. This demonstrated that neoliberal capitalism continues to promote high profits, by maintaining capital in a strongly dominant position over labor. Yet capital accumulation did not respond to the rising rate of profit
The current pervasiveness of populist expression is inherently related to the institutional bases regulating economic activity under neoliberalism and, by extension, the type of systemic breakdown it gave way to after 2008. For instance, the proliferation of asset-bubbles, while crucial to avert declining profitability dynamics, served as well to foster increasing levels of household indebtedness which, in turn, were crucial to maintain rising private consumption levels in the face of widespread wage stagnation. Once these various contradictory trends could no longer be jointly reproduced, it was the whole institutional edifice regulating economic activity that crumbled down, rather than just one of its single components. Such a type of systemic breakdown was conducive to populist expressions of protest in its aftermath.