Review of Quinn Slobodian’s Crack-Up Capitalism: Market Radicals and the Dream of a World Without Democracy (2023)
Published in Spectator, issue 44.2 (Fall 2024), edited by Jelena B. Ćulibrk
Quinn Slobodian’s previous book, Globalists: The End of Empire and the Birth of Neoliberalism (2018), tracked the development of what has come to be known as neoliberalism. With roots in the ideologies of Ludwig von Mises, Wilhelm Röpke, and other members of the so-called “Geneva School”’ working during the interwar period, Slobodian countered the conventional wisdom that held neoliberalism as an ideology built upon the principles of deregulation and laissez-faire economic policy. Instead, he posited that neoliberalism is better understood as an ongoing regulatory project that fosters the worldwide spread of capitalist economic policy. The result of this effort is nothing less than the maze of channels that comprises the present day’s globalized economic network. In his new book, Crack-Up Capitalism: Market Radicals and the Dream of a World Without Democracy (2023), Slobodian expands upon Globalists’ foundational historiography through focused case studies of polities that have put these ideas into practice over the last half-century. Together, both works provide a remarkably thorough account of the origin and spread of the neoliberal project. Through the precision and granularity of his analysis, Slobodian convincingly posits neoliberalism—and its attendant ideological bedfellows—as the essential undercurrent of the modern economic system.
Slobodian organizes his book into three sections, each comprised of multiple chapters focused on specific political entities that have notably experimented with neoliberal economic policy. These sections group together countries that may seem to have little in common geographically, though the staggering span of economic interconnection Slobodian illustrates is a critical takeaway. However, these interconnections illustrate some of the key ideas and aspirations—including their evident ironies and limitations—that have historically defined neoliberalism. The first section, entitled “Islands,” emphasizes how neoliberal ideologues have long lauded the Special Economic Zone (SEZ) as a means of “seceding” from the strictures of state or federally mandated policy. In this way, these zones can function independently, emphasizing the free flow of capital over economic and labor regulation. Nowhere has this dream of the free-market island been more vital than Hong Kong, which was one of the first polities to experiment with SEZs and see massive industrial development. The rest of the section traces the subsequent attempts of market radicals to mobilize Hong Kong-style SEZs throughout the world, including both London (an effort spearheaded by Margaret Thatcher’s administration and emblematized by the London Docklands’ transformation into Canary Wharf) and Singapore (a country that became a global player largely through the outsourcing of industry at the expense of the democratic freedoms of its citizenry). If these three examples bear out the mobility of the SEZ, Slobodian also illustrates its limits by emphasizing the deep inequality that plagues each of these countries in no small part because of its adoption.
The second section, entitled “Phyles,” which Slobodian defines as “voluntary gatherings of like-minded residents,” further focuses on the neoliberal fantasy of secession. In attempting to escape the democratic regulations of the state, neoliberals have often experimented with forms of willful segregation from both state and cultural institutions, ostensibly as a means to achieving a more individualized form of liberation. That so many of these theorists looked to apartheid-era South Africa—specifically in the form of the balkanized Bantustans that forcibly relocated and disenfranchised black South Africans—speaks to the profoundly problematic ease with which the movement has been co-opted by racial, ethnic and cultural essentialists. Slobodian’s most indispensable accounting here comes in tracing the history of the “paleo-alliance” reached between the “paleo-libertarians” and the “paleo-conservatives” during the 1990s. This coalition wed the former’s principles of capitalist decentralization and the latter’s fixation on racial homogeneity, with figures such as Murray Rothbard, the founder of anarcho-capitalism, and his protégé Hans-Hermann Hoppe propagating ideals with little acceptance from the American political mainstream.
That said, the rise of homeschooling and the increased development of gated and master-planned communities in the 1990s and into the early 2000s offered a microcosmic vision of voluntary secession that resonated beyond these hyper-capitalist circles. In perhaps Slobodian’s sharpest insight, he connects how such triumphs—however small or qualified they may be—for the crack-up cause further enabled the neoliberal project’s essential relationship with fantasy: a dream of reconstructing the world via the sanctity of the free market and devoid of the fragile variegations of democratic debate. Moreover, Slobodian expands the principles undergirding the global marketplace’s “zone fever” to all forms of secession, thus elucidating a full-bodied worldview built upon a utopian project of “opting out,” if one beset by contradictions as noxious as they are apparent.
Slobodian’s final section, entitled “Franchise Nations,” begins with an additional pair of case studies in zonal experimentation and suppression of democracy, epitomized by his analysis of Hong Kong’s heir to the crack-up throne in the twenty-first century, Dubai. In the final two chapters, his focus extends beyond the nation-state to the most modern—and powerful—actor associated with the crack-up model today: the tech company. At first, this connection was merely symbolic: Slobodian recounts the efforts of the Future Cities Development investment group to create what Stanford political economist Paul Romer described as “start-up political jurisdictions” in Honduras in the early 2010s. While the resultant zones were intended to bring what Future Cities described as the “Silicon Valley spirit of innovation” to the country, their enforcement by a violently repressive political regime made them unpopular among the displaced; in April 2022, the new democratically-elected government declared the law that allowed for the creation of such zones as unconstitutional.
The utopian tenor that has long defined Big Tech’s increasing encroachment into consumers’ daily lives is addressed beyond mere invocation in the final chapter. Slobodian posits venture capitalist Balaji Srinivasan and his concept of the “cloud country” as the key to understanding the future of the neoliberal project, with the possibilities afforded by the internet serving as the culmination of their secessionist fantasies. If the zone has failed to achieve its lofty ambitions, it is due to the consequences it wreaks on the local inhabitants who must live under its rules wherever it is implemented. The internet and, perhaps more critical to Slobodian’s argument, the incipient digitized topography of the metaverse, allows for the creation of spaces that transcend the borders of the nation-state and render their attendant political predicaments moot. The specter of this possible future is thus one of what Srinivasan refers to as “reverse diaspora” that does nothing less than rewrite the parameters of the social contract: the mass migration of all affiliation from civic identity and physical experience to that which solely can be acquired through capital. In the ultimate neoliberal fantasy, what we buy is what we believe.
That this model is just as rife with what Slobodian calls “fairly obvious” limitations (perhaps most notably the extreme energy demands of an ever-expanding digital network and the further degradation of the planet’s climate that it would undoubtedly bring about) almost goes without saying. Time and again, Slobodian reveals the neoliberal project to be at odds with the practical questions that shape people’s everyday experiences. An ideology that purports to be not just apolitical but actively antipolitical is one undergirded by a very clear set of politics. The neoliberal commitment to undermining democracy has failed in large part due to autochthonous resistance to these interlopers’ neocolonial experiments in their backyards. Slobodian’s conclusion derives its name from the rallying cry (a quote from legendary Hong Kongese actor Bruce Lee) taken up by pro-democracy protesters in Hong Kong in 2019: “Be Water.” He speculates that what this will mean for the citizenry of a country that once served as the beacon for the neoliberal imagination “might only be discovered in the process of becoming.”
That this sort of organically-mounted democratic struggle often faces long odds of enacting the change they seek, as evidenced by the fates of like-minded dissenters in violently repressive neoliberal allies like Dubai, is part of what imbues Slobodian’s book with such urgency. As the world’s two preeminent superpowers—the United States and China—have begun to weaponize increasingly protectionist economic legislation to destabilize the other, the globalized world economy that neoliberals designed enters an era of uncertainty unseen for over half a century. Slobodian’s book ultimately serves as an indispensable window into the aspirations, tensions, and contradictions that led us to this unprecedented geopolitical moment. The dream of the crack-up may have always been a fantasy. And yet, the increasing demand for legitimate democratic regimes all over the world is globalism’s most lasting legacy.