American-led globalization was on the march, as was representative democracy.
How did the wheel turn so quickly from the “Roaring Nineties” to populist authoritarianism, “democratic erosion,” and the broader crisis of trust in the 2020s?
In 1998, US President Bill Clinton was certainly among the most powerful people in the world.
Notwithstanding the Monica Lewinsky scandal, America’s “New Economy” was roaring, and Clinton was still polling well after his smashing re-election victory in 1996.
Clinton “found no takers for any version of an international New Deal,” write historians Nelson Lichtenstein and Judith Stein in A Fabulous Failure: The Clinton Presidency and the Transformation of American Capitalism.
But who was really calling the shots? Was it Rubin, the former Goldman Sachs financier, and Summers, the former Harvard University economist? Or was everyone simply being carried along by the Zeitgeist?
Harvard historian Charles S. Maier’s The Project-State and Its Rivals: A New History of the Twentieth and Twenty-First Centuries surveys what has gone wrong since the high tide of Clinton-era
Why did the social-democratic project-state run aground in the 1970s?
Maier suggests that Clinton’s brand of “third way” center-left neoliberalism was based on “magical thinking” from the start.
The second issue concerns the fate of US global hegemony.
Lichtenstein and Stein’s book is particularly effective in tracing the new logic of US economic power – based on the centrality of the dollar – as it emerged by the late 1990s.
Unlike many “resource empires” of the past, the post-1980 US no longer relied on exports of capital and goods. Instead, it ran a trade deficit with the world, financed by prodigious imports of global capital.
Jonathan Ira Levy
Project Syndicate 27 October 2023
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