The Case Against Planetary Governance

Wolfgang Streeck believes that the future of democracy lies not in newfangled structures of planetary governance, but in a recuperation of the nation state’s lost capacities. In Taking Back Control?, published by Verso last year, the German sociologist and former director of the Max Planck Institute methodically traces the quiet transfer of authority over economic life from elected parliaments to technocratic institutions beyond democratic reach. Streeck’s project warrants attention as a distinctly non-right-wing flavor of protectionism that cuts through the priors of the American political landscape.

From the inflation crisis of the 1970s onwards, Streeck argues, national governments have ceded ever-larger swaths of policy to an extraterritorial network of treaties, courts, and market watchdogs. The neoliberal turn, in his telling, did not emancipate markets from the state; it re-cast the state—above all the United States—as the enforcer of a single, border-spanning market regime. The promise of friction-free trade rests on an imposed economic uniformity that ultimately strips democracies of their sensitivity to citizens’ “collective particularism.” This enforced uniformity, Streeck shows, generates the discontent that authoritarian movements in turn exploit.

Streeck’s history helps us think about the origins of reactionary disquiet without conceding to its rhetoric. It also helps us think about the necessary conditions for an alternative populism. Drawing on thinkers including Karl Polanyi, John Maynard Keynes, and Herbert Simon, Streeck argues that the complexity of the global economy can only be democratically addressed by the downward delegation of sovereign powers. Against both planetary technocracy and reactionary nationalism, Streeck envisions an international order of small, democratically empowered states capable of shaping economic outcomes in response to the public good.

Combinations’ Matt Prewitt and Guy Mackinnon-Little spoke with Streeck about the sources of state authority, the complexity gap between networks and human societies, and what an international system that bolsters rather than undermines sovereignty might look like.

Combinations: You say that, “[t]here is no democracy outside of a state, nor can there be a democratic state in the absence of state sovereignty.” Could you unpack this? 

Wolfgang Streeck: I am speaking of modern state-societies, as they have emerged in Europe in early modernity (since roughly 1500 CE). There can be and have been egalitarian “charismatic” (Max Weber) communities. They are, however, typically small and non-territorial. Modern societies are organized in states that claim sovereign authority (ultimate authority) over a territory. There is a great variety of state-society configurations; in all of them, state authority can in principle be democratically controlled, meaning among other things that a majority of citizens can legally overturn the sitting government. Citizens can fight for that right, sometimes they win, sometimes they lose. Nothing like this can happen in a large capitalist enterprise. Democratic control of state authority is not worth much, however, if the state in question doesn’t have sovereignty, i.e., if it is part of another state’s international empire. This is what I mean when I say there cannot be a democratic state in the absence of state sovereignty. 

C: You’ve developed the concept of the “Keynes-Polanyi state” in your work. Could you explain this concept and how it informs your analysis of the tensions between capitalism and democracy?

WS: I refer to the Keynes of the 1933 so-called Yale Lecture, where he abandons free trade in favor of political control of national economies by sovereign national states. (“I sympathize, therefore, with those who would minimize, rather than with those who would maximize, economic entanglement among nations. Ideas, knowledge, science, hospitality, travel--these are the things which should of their nature be international. But let goods be homespun whenever it is reasonably and conveniently possible, and, above all, let finance be primarily national.”) And I refer to Karl Polanyi’s insight that a national government that has no control over its international economic relations, including in particular the value of its currency, cannot protect its citizens from “the vagaries of the market” and therefore runs the risk of being overthrown by radical anti-democratic forces, including fascist ones. Both Keynes and Polanyi advocate for national sovereignty to be extended to the economy, for both economic and democratic reasons.

C: The idea of the Keynes-Polanyi state seems tailored to the European context—small or mid-sized states surrounded by other similarly sized states. What do you say to Americans, Indonesians, or Brazilians trying to imagine a democratic future for their societies? 

WS: I say decentralize, as an alternative to secession. I would like to share with them a general hunch that devolution, as the British call it, may increase the responsiveness and the democratic quality of large states—that decentralization can relieve political tensions that stem from diverse local problems and interests. Local conditions must be considered and respected. Almost anything is better than repressive centralism within or aggressive imperialism between states. Effective decentralization presupposes a regional international peace regime. National democratic forces must work together across borders for international peace as a precondition for an internationally acceptable pursuit of national agendas. 

C: What of the prospect of large states’ collapse or breakup? Is a network of smaller democratic states imaginable on territories which do not necessarily have a history of smaller, geographically-defined political communities?

WS: I am not offering a Grand Plan for the slicing up of large states in my book. All I do is argue, with good reasons I believe, against more centralization and for more decentralization, both within and between states, as a heuristic principle or working hypothesis: don’t seek salvation in more centralization, instead look for and explore in practice the benefits of decentralization. More centralization may mean less responsiveness and less accountability of elites, both national and international, without a realistic prospect of compensation by more effective government. Instead, more centralization comes with a risk of brute force imposing and sustaining a social order that is neither legitimate nor efficient, at, again, both national and international levels. 

Let me add that a breakup of large states is dangerous as it may result in war, especially when engineered or supported from the outside (remember Yugoslavia, and think of the mad projects of Baltic political leaders to get the United States and Germany (!) to do them the favor of breaking up for their benefit the Russian Federation in four or so smaller states). The problem with “territories which do not necessarily have a history of smaller, geographically-defined political communities”—as you put it—is that if they fail to integrate into “network[s] of smaller democratic states” they are likely to become or remain de facto colonies in a continental or multi-continental empire, subject to a Pax Romana run by some mad emperor, whoever Rome may then stand for. The task of political development, especially south of the equator, includes the formation of egalitarian regional systems of sovereign states under a jointly established and maintained global or regional order of peace. Remember the movement of the non-aligned in the 1960s and 1970s, or current efforts of the BRICS to build an international order that fits into a multipolar rather than a bi- or unipolar world. 

C: Large states face a dilemma between being ungovernable (by not planning their economies) and failing economically (by planning their economies). Is that a fair summary of your view? 

WS: By and large yes. They have to choose between market failure and technocracy failure, in addition to democracy failure. But you have to add that ungovernable large countries may become governable for a while by brute force. Neoliberal national or, for that matter, international economies become ungovernable because their markets tend to turn into hunting grounds for large national and international firms. Centralized states trying to manage a large and diverse political economy are unable to attend to different regional needs and problems, which may detract from their technical capacity and thereby damage their political legitimacy. There are more permutations to this, some known, some as yet unknown.

C: If states and their surrounding structures undergo the process of “decomposition” you describe in the book with reference to Herbert Simon, how might these smaller political units protect their sovereignty from new forms of hegemonic pressure?

WS: States, I have pointed out, never walk alone: they are always part of an international order. All states are member states. Their degree of sovereignty is the result of many factors including international organization and international law. Smaller countries have a vital interest in an egalitarian, sovereignty-respecting international order, unlike (some) large countries, like the United States in particular. There is no patent medicine here, no guarantee. Empire is a problem, not a solution. Governments must be forced by their citizens to uphold international law; see the following excerpts from the UN Charter of 1945:

(Art. 1,1) The Purposes of the United Nations are…. to maintain international peace and security, and to that end: to take effective collective measures for the prevention and removal of threats to the peace, and for the suppression of acts of aggression or other breaches of the peace, and to bring about by peaceful means, and in conformity with the principles of justice and international law, adjustment or settlement of international disputes or situations which might lead to a breach of the peace...

(Art. 2,3) All Members shall settle their international disputes by peaceful means in such a manner that international peace and security, and justice, are not endangered.

(Art. 33,1) The parties to any dispute, the continuance of which is likely to endanger the maintenance of international peace and security, shall, first of all, seek a solution by negotiation, enquiry, mediation, conciliation, arbitration, judicial settlement, resort to regional agencies or arrangements, or other peaceful means of their own choice.

If we don’t finally learn this, the next conflagration is around the corner.

C: Balaji Srinivasan has proposed the concept of “network states”—cloud communities with shared purpose that eventually acquire territory—as an alternative to traditional nation-states. Similarly, other techno-capitalist thinkers advocate for corporate sovereignty models. What determines whether the fragmentation of existing political structures leads toward democratic renewal versus privatized governance?

WS: A general remark before I try to answer your specific question. I cannot take a theory of the future seriously unless it includes an answer to the question of how we can get from here to there. Someone must make the alternative real by making the real unreal. There needs to be an agent, in the widest sense, and a path the agent can take. Does the replacement of present territorial states with future network states require a war, like the one in 1914-1918 which undid the post-feudal European empires and brought in the nation state, or in 1939-1945 which replaced the international anarchy of the interwar years with the bipolar order of the Cold War? (Also remember 1990 and the transition from the Cold War to George H. W. Bush’s New World Order, which lasted roughly three decades.) Are we envisioning the Trump Co. together with Elon Musk Bros. conquering China and replacing, upon their inevitable victory, the potentially democratic territorial state with their privately owned network state? Note that networks are much less complex and much more functionally specific than human societies. Will people really give up the latter in favor of the former? On your last question, it is ultimately the citizens themselves that decide, at the ballot box or by taking up arms. There is no free ride to democracy.

C: Network technologies once featured prominently in anti-globalization movements but increasingly represent what you call “private hierarchies” that erode democratic influence. What role, if any, could technology play in realigning the state with the social relations of which it is composed?

WS: I distinguish between states and societies. Societies are composed of social relations that are not necessarily state relations. States are functionally specific organizations, societies are functionally diffuse communities. States and societies are aligned through a wide variety of links and channels. You rightly point out that in a capitalist state-cum-society, many of these channels are privately owned and controlled. Can technology make states more responsive to social interests that are democratic interests, i.e., interests of the many rather than the few? (There are “social relations,” in your terminology, that are already well-aligned with the state, for example, capitalist property relations.) How responsive network technologies can make politics to social needs depends who owns and designs them. Technology per se is not an answer to anything.