Should-Read: Nils Gilman: The Twin Insurgency: “By the 1970s,… the social modernist states were increasingly failing to deliver

…In the West, inflation eroded the technical foundations of the Bretton Woods financial order, and economic stagnation undermined the technocratic consensus in favor of Keynesian demand management and the political consensus in favor of sharing productivity gains between labor and capital. In the East, centrally planned economies were revealing themselves not only as politically repressive but also as economically inefficient and environmentally catastrophic. In the “Global South”… industrialization by means of import substitution failed to sustain growth, and the debt crisis of the early 1980s put to rest any dreams of a new international economic order….

It wasn’t just that the state “retreated” from the “commanding heights” of the economy, to use Daniel Yergin’s terms, but also that the very ambition of the state receded. Many states stopped even pretending they wanted to create a more egalitarian society and instead sought to legitimate themselves by claiming they were maximizing individual opportunity. For proponents of this perspective, the rise of new plutocrats counted not as a defeat, but as a success for the new model of governance…. Fukuyama proposed… universal agreement that liberal, democratic capitalism was… the only reasonable form of socio-political-economic organization…. Williamson… [a] “post-historical” policy consensus… [of] fiscal discipline, the redirection of public spending away from subsidies, the rollback of progressive tax codes, the floating of currencies, the liberalization of trade and cross-border investment, the privatization of state enterprises and deregulation of private ones, and above all the sanctification of private property rights…. The programs associated with the Washington Consensus—above all, the privatization of national industrial assets (especially of state-owned firms and utilities) and deregulation (especially of financial firms)—soon became the model…. As Dani Rodrik concluded, “‘Stabilize, privatize, and liberalize’ became the mantra of a generation of technocrats who cut their teeth in the developing world and of the political leaders they counseled.”

This transformation of the role of the state in the wake of the Cold War has dramatically increased the precariousness of the lives of the middle classes within most societies…