The Civil State: an alternative model of democracy and modernization

Does modernisation thrive in conditions of democracy or autocracy? What is the relationship between economic and political liberalisation? How do different types of democratic rule affect the economy and the well-being of citizens and societies? Following the partially failed transformation from state totalitarianism to market democracy and the ‘end of the transition paradigm’, which alternative models of development are available to Russia, other BRIC countries and rising powers such as South Africa or Indonesia? Twenty years after the collapse of Soviet communism, the current crisis of liberal ‘free-market’ capitalism and authoritarian state capitalism provides a unique opportunity for both advanced economies and emerging markets to chart an alternative path – the civil state.

This chapter argues that both state-centric and market-driven models of modernisation, which have been dominant since the late nineteenth century, have neither delivered vibrant democracies nor produced prosperous economies. Instead, both models have tended to favour a centralisation of power at the expense of autonomous, self-organising communities, localities or associations and a concentration of wealth in the hands of ‘old elites’ or ‘new classes’ (or both at once). In turn, these developments have led to the progressive ‘disembedding’ (Karl Polanyi) of the economy and politics from the social relations and civic bonds that ultimately bind society together. Linked to this is a growing subordination of civil society and its intermediary institutions to the convergence of states and markets, a constellation that applies in different ways to liberal ‘market monopoly’ and authoritarian ‘state capitalism’.

These and other paradoxical notions suggest that the conventional categories of state versus market, left versus right or democratic versus authoritarian no longer provide an adequate analytical framework that can describe and explain the complex interaction of democracy and modernisation. Instead of Fukuyama’s ‘end of history’ and a global convergence towards Western-style liberal market democracy, what we are seeing in reality are post-democratic ‘market-states’ in the global North (including Japan and Oceania) and authoritarian ‘state-markets’ in the global South (including the BRIC countries and other emerging economies). While there is no equivalence between rival regimes and their ideologies, it is nevertheless the case that both state collectivism and market individualism have in different ways brought about economic inefficiency, social dislocation and political polarisation.

By favouring the collusion of big business and big government, both systems have undermined the associative ties binding together citizens and communities within and across localities, regions and nations. As such, the alternative to post-democratic ‘market-states’ and authoritarian ‘state-markets’ is a moral economy and a civil state. This alternative, which the chapter begins to outline, consists in pluralising the central state, mutualising the ‘free market’ and building a civil covenant that blends political representation with greater civic participation.

The first section discusses different strands of modernisation theory, arguing that the current debate between state-centric and market-driven models of development neglects the importance of groups, associations and communities in building an economy that is embedded in social relations and serves the interests of both individual citizens and society as a whole. The second section suggests authoritarian state capitalism and post-democratic market capitalism are paradoxical political economies that do not fit the conventional categories of standard modernisation theory. The third section draws on the traditions of pluralism, associative democracy and civil economy to develop the idea of a civil state that is based on the principles of reciprocity, mutuality and solidarity. The final section presents some concluding remarks.