Democracies are on track to lose their global economic dominance as ‘authoritarian capitalism’ rises

Jim suggested that we post this article. Good idea, Jim. This article is courtesy of CNBC

  • Within five years at current trends autocratic countries will account for more than half of global income for the first time in more than a century, according to a recent analysis.
  • Trump may seem an unlikely representative for this American rediscovery of its global purpose. His critics condemn his closeness to autocrats like Xi, Putin and Kim Jong Un.
  • However, Trump’s record also includes supporting efforts to democratically replace Venezuela’s dictator, his targeting of China’s unfair trade practices and his opposition to Iran’s mullahs and their Revolutionary Guard Corps.

This week’s mini-drama over President Donald Trump’s Fourth of July speech, with all its military accompaniment, shouldn’t distract anyone from the far more significant story of global democratic decline on this 243rd anniversary of American Independence.

Dangers are accelerating to the democratic ideals that the American Revolution inspired. If no unanticipated shock disrupts current trajectories – say a democratic uprising in China, a Russian regime change or, still significant, a Venezuelan dictator’s decline – autocratic powers will surpass democracies in their economic size and influence within the coming decade.

And history has shown prosperity often precedes political dominance.

What’s been broadly reported by now is that global democratic freedoms are in their 13th year of decline, a result both of surging autocracies like Russia and China, fraying freedoms in liberal democracies and Western complacency about both. “The overall losses are still shallow compared with the gains of the late 20th century, but the pattern is consistent and ominous,” Freedom House reported in its 2019 assessment

Less recognized, but perhaps ultimately more decisive, is that within five years at current trends autocratic countries will account for more than half of global income for the first time in more than a century. That’s based on an analysis of International Monetary Fund figures by political scientists Roberto Stefan Foa and Yascha Mounk.

That would mark a stunning reversal in fortunes.

Back in the 1950s and 1960s, when the Eisenhower and Kennedy administrations responded successfully to the pioneering Soviet launch of the Sputnik satellite, the U.S. and its democratic allies in Europe and Japan were producing some two-thirds of the global economy. As recently as 1990, countries rated “not free” by Freedom House accounted for only 12 percent of global income. Now they produce a full third, matching the level authoritarian-run economies achieved during the rise of European fascism in the 1930s.

That raises some unsettling questions.

How much of democracies’ success came from the attraction of Western values like free speech and individual rights? How much instead was a result of new democracies wanting to hitch their wagons to American and Western European prosperity and extract themselves from the bankruptcy of the Soviet and other, similarly constructed, state-controlled systems?

It was certainly a product of both – but democracies will struggle more in a contest with autocracies if they produce less comparative prosperity over time.

“If the West is to navigate this new world successfully, it will need to understand how the scales tipped so rapidly from democratic dominance to authoritarian resurgence,” write Foa and Mounck. They conclude the more important factor than weakening democracies has been the rise of “authoritarian capitalism.”

Previously, they write, autocratic regimes whose income increased substantially either stopped growing, like the Soviet Union, or became democratic, like South Korea, Spain, Portugal and Greece and other formerly military regimes. The outlier was Singapore, a non-democracy that continued to grow, yet of insufficient size to shape history.

“But a growing number of countries have learned to combine autocratic rule with market-friendly institutions,” write Foa and Mounck, “and they have continued growing economically well beyond the point at which democratic transitions used to occur.”

If there were any doubt that today’s autocrats consider themselves locked in competition with liberal democracies – and believe they are winning – that was dispelled by last week’s ground-breaking interview by Lionel Barber and Henry Foy of the Financial Times with Russia’s Vladimir Putin.

On the eve of the G-20 summit in Osaka, Japan, Putin said “the liberal idea” had “outlived its purpose.” Said Putin, ”(Liberals) cannot simply dictate anything to anyone just like they have been attempting to do over the recent decades.”

That said, Putin knows better than anyone else that this history isn’t yet fully written.

First, autocracies’ fundamental weaknesses and inflexibility will continue to make them fragile and prone to regular, popular attempts to stretch individual freedoms beyond what their government systems can sustain.

Frida Ghitis in Politico points to three recent events, which though far from decisive, made June a bad month for autocrats.

Chinese leader Xi Jinping has faced massive and persistent Hong Kong protests staged against an extradition bill China had wanted to impose on Hong Kong residents. Putin’s Russia dropped all charges against investigative reporter Ivan Golunov following an outpouring of public and media support for the detained journalist.

Beyond that, Turkish democracy showed new life after a rerun of Istanbul mayoral elections produced an even larger, landslide victory for opposition candidate Ekrem Imamoglu, which Ghitis sees as a blowback against President Erdogan’s increasingly authoritarian rule and his slowing economy.

Second, the scales could tip again toward democracies should major countries like India, Nigeria and Indonesia not only stabilize as prosperous democracies but also come to identify themselves more as part of a global community resisting authoritarianism.

Finally, the United States again could embrace its historic role in inspiring, sustaining and expanding democratic rule. That began with its 18th century emergence as a lonely, revolutionary democracy, having thrown off the shackles of monarchical rule, to its role as the post-Cold War leader with Europe of a democratic community of countries that for the first time in history made up the global majority of nations.

Trump may seem an unlikely representative for this American rediscovery of its global purpose. His critics condemn his strongman tendencies and his closeness to autocrats like Xi, Putin and North Korea’s Kim Jong Un. However, his record also includes supporting efforts to democratically replace Venezuelan dictator Maduro, his targeting of the unfair trade practices spawned by Chinese state leaders and his opposition to Iran’s mullahs and their Revolutionary Guard Corps.

On the steps of the Lincoln Memorial this week, he said the right thing.

“As we gather this evening, in the joy of freedom, we remember that we all share a truly extraordinary heritage,” Trump said. “Together, we are part of one of the greatest stories every told – the story of America.”

Democracy was born in Athens in 508 BC, but it was relatively dormant for two thousand years. Robert Kagan reminds us that the U.S. emerged in the 1700s as a democratic republic with “radical liberal principles” that were viewed with alarm in “a world dominated by great power revolutionaries.”

Since then, the U.S. has been at the center of democracy’s story. The U.S. inspired democracies’ expansion following World War I. It then stood by as they declined in the face of European fascism ahead of World War II. It fought for their survival in World War II and for their Cold War victory that was to have democracies’ final triumph.

This new struggle need not be zero sum. That said, if autocratic countries form the largest economic and political bloc, don’t expect them to allow others to write the rules that regulate the future.

Frederick Kempe is a best-selling author, prize-winning journalist and president & CEO of the Atlantic Council, one of the United States’ most influential think tanks on global affairs. He worked at The Wall Street Journal for more than 25 years as a foreign correspondent, assistant managing editor and as the longest-serving editor of the paper’s European edition. His latest book – “Berlin 1961: Kennedy, Khrushchev, and the Most Dangerous Place on Earth” – was a New York Times best-seller and has been published in more than a dozen languages. Follow him on Twitter and subscribe here to Inflection Points, his look each Saturday at the past week’s top stories and trends.TRENDING NOW

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  1. On July 7, 2019 at 3:50 pm,
    David says:

    Autocratic and capital friendly markets. Sounds like Fascism. What’s new.

    • On July 7, 2019 at 4:07 pm,
      Big Al says:

      One way to look at it David. Thanks for the comments.

    • On July 7, 2019 at 8:21 pm,
      Matthew says:

      Fascism is friendly to connected owners of capital. As with socialism/communism, it is the enemy of free markets and free people. Fascism/socialism/communism run on coercion not cooperation.

      The Socialist Economics of Italian Fascism

      • On July 7, 2019 at 8:23 pm,
        Matthew says:

        The following nails it…
        In The Concise Encyclopedia of Economics, Sheldon Richman succinctly states: “As an economic system, fascism is socialism with a capitalist veneer.”

  2. On July 7, 2019 at 3:56 pm,
    OOTB Jerry says:

    Max K….on what is going on with the Fraud Fed….Toxic waste

  3. On July 7, 2019 at 4:17 pm,
    OOTB Jerry says:

    How much will it take to retire….$1.7 Million will not do it……..better go back to the drawing board….

  4. On July 7, 2019 at 7:04 pm,
    cfs says:
  5. On July 7, 2019 at 8:21 pm,
    CFS says:

    Congratulations to US women’s soccer. Best in the world.

    • On July 7, 2019 at 8:59 pm,
      Ebolan says:

      No, not best in the world by a million miles. As Ann Coulter pointed out they can’t even beat 15 year old boys.

      And what do they do now? Cry about how they don’t make as much as the men. Well, men’s soccer has no problems getting butts in seats and generating TV revenue unlike women’s soccer (with the exception of the world cup).

  6. On July 8, 2019 at 8:30 am,
    OOTB Jerry says:

    Ponder this…..Patriots……..
    So, who were the real patriots — the ones who supported the troops or the ones who shot and killed the troops? In the movie The Patriot, which starred Mel Gibson, the answer was that the patriots were those who are willing to stand up to the wrongdoing of their own government, which sometimes means standing up to the government’s troops.

    When the rebels prevailed in the conflict and formed their own government, the last thing they wanted was a military nation, the type of nation that Trump extolled in his Fourth of July speech. The reason they opposed a military nation was because they were convinced that the greatest threat to the freedom and well-being of a citizenry lies with their own government, not some foreign threat. They also understood that the way that people’s own government is able to destroy their freedom is through the force of a powerful military, one that can easily put down revolts and force people to submit to the tyranny of their own government.

    That’s why our American ancestors were so opposed to a “standing army,” which was their term for a powerful, permanent military-intelligence establishment. Consider, for example, the following:

    James Madison: “A standing military force, with an overgrown Executive will not long be safe companions to liberty….”

  7. On July 8, 2019 at 8:31 am,
    OOTB Jerry says:

    President Trump is being criticized for surrounding himself with tanks, armored vehicles, flyovers, and generals and admirals during his Fourth of July celebration at the Lincoln Memorial. Critics say that it was unseemly for the president to be showing off the federal government’s military process on Independence Day. Some said it conjured up images of the Soviet Union, when that communist regime would showcase its tanks and military hardware in parades in Moscow’s Red Square.

    But the fact is that America is a military nation. As Trump pointed out in his Independence Day address, the United States has the most powerful military in history, one that can pulverize any other nation on earth. His critics don’t have any problem with that. They just don’t want Trump to highlight it.

    Of course, it wasn’t always that way. In extolling America’s position as a military nation, Trump left out something important in his talk: America did not start out as a military nation. In fact, quite the contrary. America was founded as a limited-government republic, not a military nation.

    In fact, the people who founded the United States abhorred the concept of a military nation. That’s one of the reasons they chose to revolt against their own government, which was a military nation, one whose officials extolled its military prowess, just as Trump does today with America.

    • On July 8, 2019 at 8:35 am,
      OOTB Jerry says:

      Last week, President Trump stated that America’s military forces protect our “freedom.” In actuality, it’s the opposite. America’s military forces are part of the national-security governmental apparatus that has destroyed our liberty, in the name of “keeping us safe” from “enemies,” many of which have been produced by the national-security state’s policy of intervening and meddling in the affairs of other nations. After all, how can people truly be considered free when they live under a regime in which government officials wield the omnipotent, totalitarian-like powers to assassinate them, incarcerate them indefinitely in military dungeons and concentration camps, torture them, execute them, embroil them in forever wars in faraway lands, and tax and spend them into penury to fund the ever-growing military-intelligence establishment.

      One of the ironies in all this is that while Americans live under the most powerful military in history, as Trump pointed out, the American people are the most frightened people in the world. They are scared to death that everyone is coming to get them — the Muslims, terrorists, communists, illegal immigrants, and drug dealers — and that it’s only the national-security establishment that is preventing this from taking place. Americans have traded their liberty for “security,” have ended up with neither, and, worst of all, don’t even realize what they have done.

      Trump wants to make America great again. His mistake is in believing that he can accomplish that by making the national-security part of the federal government even more powerful than it already is. A powerful government inevitably results in a frightened citizenry and a weak nation. The way to make America great again is by making the American people free and independent, which necessarily entails a restoration of a limited-government republic, one that reflects America’s founding antipathy toward a military nation.

      Reprinted with permission from Future of Freedom Foundation.

      THINK ABOUT IT>>>>>>>>>>>

  8. On July 8, 2019 at 9:22 am,
    Ebolan says:
    • On July 8, 2019 at 10:18 am,
      OOTB Jerry says:

      Like he said……….”If not me who”………The FEDS DID NOTHING….

      • On July 8, 2019 at 10:19 am,
        OOTB Jerry says:

        Federal Govt… worthless…….

        • On July 8, 2019 at 10:23 am,
          OOTB Jerry says:

          MSN……what a joke………

          • On July 8, 2019 at 10:27 am,
            Ebolan says:

            Gotta wonder what would have happened or more likely not happened if Cernivich did not file that lawsuit. It sounds like once the Miami paper got involved people paid attention but that never would have happened if Cernovich did not do the ground work. At least that’s what it sounds like.

          • On July 8, 2019 at 10:28 am,
            Ebolan says:

            Here’s another one where the MSM won’t discuss…


          • On July 8, 2019 at 10:37 am,
            Ebolan says:

            And make sure to see this…Cernovich


          • On July 8, 2019 at 10:55 am,
            OOTB Jerry says:

            Thanks…..I will scan the lasts one….due to time constraints ….thanks again.
            Mike is due a lot of congrads…..jmo

          • On July 8, 2019 at 11:02 am,
            Ebolan says:

            As that Chisto4you guy asked will this be what brings down the Clintons?

          • On July 8, 2019 at 12:01 pm,
            Ebolan says:

            Another one to check out.

            The Media’s First Love – War


  9. On July 8, 2019 at 12:05 pm,
    Ebolan says:

    And on a weather note the District of Criminals is flooding today…guess Trump didn’t drain the swamp enough…

    • On July 8, 2019 at 12:34 pm,
      OOTB Jerry says:

      Sewer must have backed up…. 🙂

  10. On July 8, 2019 at 12:08 pm,
    Temple says:

    Too bad Big Al left the Catholic Church — he might do a bit more homework and dust off what knowledgeable economists (especially educated Catholic ones) long ago termed “The third way.” This ill-informed discussion over a false choice is a waste of time.