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Managing the Discontent of the Losers

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  • Mark Setterfield

    (Department of Economics, New School for Social Research)

Abstract

In the early-mid 1990s, Social Structure of Accumulation (SSA) theorists identified the solidification of a neoliberal SSA that included a capital-citizen accord based on “managing the discontent of the losers”. This created social stability by reconciling working households to material hardships emanating form the neoliberal labour market by means of either coercion or non-economic distraction. This paper argues that there was, in fact, a fundamentally material basis to the neoliberal capital-citizen accord, including the ability of households to accumulate debt in order to limit the growth of consumption inequality in the face of burgeoning income inequality. The material basis of the capital-citizen accord broke down during the financial crisis of 2007-09, destabilizing the accord itself. The result is that an SSA that has resisted top-down reform is now threatened by bottom-up “reform” in the shape of rising populism. The outcomes of this process are highly uncertain – a key characteristic of the periods of inter regnum that separate successful SSAs.

Suggested Citation

  • Mark Setterfield, 2018. "Managing the Discontent of the Losers," Working Papers 1816, New School for Social Research, Department of Economics.
    • Handle: RePEc:new:wpaper:1816
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    References listed on IDEAS

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    Cited by:

    1. Mark Setterfield, 2024. "Managing the Discontent of the Losers Redux: A Future of Authoritarian Neoliberalism or Social Capitalism?," Working Papers 2401, New School for Social Research, Department of Economics.
    2. van Netten, Jamie, 2023. "The relationship between inequality and bank credit in Australia," Warwick-Monash Economics Student Papers 54, Warwick Monash Economics Student Papers.
    3. Mark Setterfield, 2022. "Neoliberalism: An Entrenched but Exhausted Growth Regime," Ensayos Económicos, Central Bank of Argentina, Economic Research Department, vol. 1(79), pages 131-146, May.

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    More about this item

    Keywords

    Social structure of accumulation; capital-citizen accord; household debt; consumption inequality; populism;
    All these keywords.

    JEL classification:

    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • B51 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Socialist; Marxian; Sraffian
    • B52 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Historical; Institutional; Evolutionary; Modern Monetary Theory;
    • P16 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Capitalist Institutions; Welfare State

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