The Production of Democracy

Abstract

Our economic cooperation is marked by hierarchical relationships. Most people work under the authority of unaccountable managers, while a minority of wealthy investors shape the future of productive enterprises. Yet, economic hierarchy is rarely considered as problematic as political hierarchy such as oligarchy or restrictions on voting rights. Democracy is thought to impose demanding requirements on state political institutions, but at best overridable recommendations on economic institutions. Behind this view lies the idea that the democratic state controls and regulates the economy from a higher standpoint of equality. However powerful economic superiors may be, they are ultimately subject to a political system that treats everyone as equals. Thus, democratizing the economy is unnecessary; political democracy can justify economic hierarchy. I call this line of thought the State-above-the-Economy Argument. My dissertation argues against it, in favor of what I call a dual-core theory of democracy. My argument proceeds in three steps. First, I clarify the political nature of the modern economy and the kind of justification it demands. Our economic cooperation is structured through asymmetrical subjection to power and authority, effected through society’s overarching institutional framework. These institutionalized relations of subjection constitute an informal political system, which must therefore be evaluated according to the principles of democracy, not just efficiency. Second, while economic institutions are often thought to be exempt from the requirements of democracy by virtue of being governed by a democratic state, I argue that this view is mistaken. The democratic state is itself constrained in its power, legitimacy, and knowledge by the very economic structure it is supposed to govern. Democracy’s demands on the economy cannot be outsourced to the state; economic institutions themselves must be brought within the scope of democratic justification. Finally, how are we to recover the democratic ideal in light of the economy’s profound constraint on politics? A common response demands moral discipline: economic actors must subordinate themselves to the sovereign democratic state’s will. I reject this view. Contestation in and through the economy, when properly structured, can be a force for democracy. Thus, the question is not whether but how economic rights constrain political decision-making. Rather than seeking to insulate politics from economic power, we must theorize democracy as a justifiable form of interdependence between the state and the economy.