Are the economical crisis of 2007 and its bleak aftermath a result of the neoliberal anti-democratization?

            In their paper “misrule of experts” Engelen, Etrul et al. effectively argue (among other things) that the global crisis of 2007 was, essentially, a result of depolitization of economy made from the top that led to crisis.

To begin with, for a number of reasons in the 1980s western political elite became neoliberal, and from the neoliberal perspective economics should not be very “governed” and regulated, - instead the market should freely stabilize itself and the society, with possibly a few “light touch” regulations by the technocrats. Thus, the economy was seen separated from the democratic (at least in its name) politics. The economy – especially the finance sector - was essentially left to the technocrats, to the “experts”, i.e. to the statesmen who often used the system for their own profit without any regard for the general population, since the economy was conceptualized by the neoliberal ideology as something “outside” of the realm of political. In other words, the elite became corrupted and used the chaos of the free market for its own profit because it had no public to watch it, for economy became presented as something un-political, as something left to “specialists”, technocrats and professional politicians

Yet, technocrats are only human and without any public watch the economic elite became tied to political elite - Tony Blair, for example, “currently makes £3.5 million per year as a senior advisor to J.P. Morgan on top of the £500,000 per year as an advisor to Zurich Financial, another six figure sum as advisor to private equity firm Khosla Ventures and £1 million per year as a ‘governance advisor’ to Kuwait”. So, Blair is not only a politician, but also an agent in the finance sector with an obvious economic interest. However, he is also able to influence the market through his policies, and such an influence might be beneficial for him and those he represents as a social class, but not for the whole of population.

Of course, separation of economy from politics was theoretically justified by the wealth it would bring to the general population, i.e. such a system seemed profitable from the democratic point of view. Time, however, proved that it was not profitable – at least, not in the 21st century (as a matter of fact, the public who had basically no active role in the crisis suffered much more than the bailed-out super-rich who led the system towards the crisis).

So, it is fair to say that it is in the very nature of free market to produce corruption. One might argue that a market in which statesmen are involved is not a “real” free market, and a real free market would be a non-corrupt stateless entity. However the only way a free market can exist is with a government defending the free market from democratic regulation or lawless intervention. Yet, if the state creates a space outside of the reach of the public, but has an access to the market – and the state must have access to the market in order to support the rights of property, keep the interventionists away and etc. - it will lead to the statesmen using their privileged position for their private interest and would spoil the whole market system. 

The problem, however, is not merely that the crisis was caused by the depolitization of markets. It is that because of such a depolitizaion we cannot even properly try to overcome it (and no one even dares to think beyond the limits of markets), since the general “cure” is more technocratic involvement, which had been one of the reasons for the crisis in the first place. Instead, what might be necessary for the transgression of crisis and general dysfunction of contemporary state is a straight democratization of economy.