Three decades after WWII in USA and other industrialized democracies wages rose in line with increased productivity; the government expanded social programs while maintaining progressive tax rates; and a growing majority of families achieved a middle-class standard of living. This was the high point of success for the New Deal coalition in USA and the European social democracies. Democracy worked, politicians took credit and voters responded. [See William K. Tabb, What if? Politics and Post-Capitalism]
Deepening crisis of legitimacy for Democracy
Several reasons for the “democracy deficit” are spelled out in recent Nation essay by Thomas Meany and Yascha Mounk.
Since then elites have worked to insure that economic policy not be subject to electoral politics. One result of this is that inflation is seen as a demon more harmful than unemployment. For decades the western democracies used monetary tools to redistribute wealth and to create demand led public and private sector employment growth. In the same sequence of policy moves domestic markets were opened to international competition and controls on the movements of capital were ended. These neoliberal structural adjustments, on top of privatization, deregulation, and union busting, have shifted the political calculus of politicians such that the most significant constituency for them are no longer voters but creditors of public debt. Democracy not working.
Their essay poses this difficult rhetorical question:
“How much longer can we continue to insist that some idealized regime called “democracy” is the best political system of all, and that our noxious political reality conforms to that ideal, when both claims are so evidently spurious?”