The Cold War Origins of the “Crisis of Democracy”

This article suggests that a “crisis of democracy” can be understood not simply as a deterioration of specific representative institutions but as a repositioning of democratic politics vis-à-vis other principles of social coordination, most notably the capitalist market, and the attendant decline of democratic subjectivity—people’s attunement to claims appealing to the common good. I trace this process to the post–World War II era. I show that the crisis of democracy was shaped by the substantive imperative of fusing democracy with free-market capitalism. Many postwar democratic theorists believed that the welfare state could manage the tension latent in this fusion. But an analysis of Friedrich Hayek’s theory of neoliberal democracy, which recognizes that tension more acutely, reveals that the incorporation of free-market capitalism creates tendencies that undermine democracy from within.