Since Francis Fukuyama’s essay takes up some key themes from his book The End of History and the Last Man, I think it would be useful for the purposes of this symposiumfootnote if I were to focus part of my comments on that work itself.footnote1 The core of Fukuyama’s argument is that there is no satisfactory alternative to what he calls liberal democracy (I prefer to call it capitalist democracy). The main challenge to capitalist democracy in this century, he says, was Soviet-style Communism, which has now revealed itself to be a definite failure. Other alternatives of one sort or another—fascism, various forms of rightist authoritarianism, or Iranian-style theocracy—remain possible, but they are infinitely less satisfactory than capitalist democracy, and do not in any case correspond to the march of history. The future belongs to capitalist democracy, which represents, in Fukuyama’s words, ‘the end point of mankind’s ideological evolution’ and the ‘final form of human government’ (p. xi). ‘Left-wing critics of liberal democracies,’ he also claims, ‘are singularly lacking in radical solutions to over-coming the more intractable forms of inequality’ (p. 293, emphasis in the original).

In opposition to this line of reasoning, I wish to argue that there does indeed exist a radical alternative on the Left to capitalist democracy. This alternative is socialist democracy, which has nothing whatever to do with Soviet Communism, and which Fukuyama altogether fails to consider. He takes note of the many Westerners who hoped that the peoples of the post-Communist countries would use their newly won freedoms to ‘choose a “humane” left-wing alternative that was neither communism nor capitalist democracy’ (p. 34). This, he quite rightly adds, turned out to be a total illusion. Many socialists who had been bitterly critical of Soviet Communism had harboured hopes that the Soviet Union might eventually begin to approximate something that could be called a socialist society. But the illusory nature of these particular hopes tells us nothing about the possibility of socialism.

Fukuyama also notes in a footnote that ‘in the course of the entire controversy over [my original article on “The End of History?” in The National Interest] no one that I am aware of suggested an alternative form of social organization that he or she personally believed to be better’ (p. 347 n. 10). If so, this proves the present decrepitude of the Left, but nothing else. I do want to consider this alternative, which I think is an infinitely more desirable and viable form of social organization than capitalist democracy. In order to prepare the ground for my defence of this view, however, I must first say something about capitalist democracy, and why a radical alternative to it is an essential condition of human progress.

Fukuyama concedes that ‘liberal democracies are doubtlesss plagued by a host of problems like unemployment, pollution, drugs, crime, and the like’ (p. 288); that the ‘economic inequality brought about by capitalism ipso facto implies unequal recognition’; and most remarkably, that ‘major social inequalities will remain even in the most perfect of liberal societies’ (p. 292). This frank admission from so determined an advocate of capitalist democracy is very damaging to his case, not least given his insistence that liberal democracy uniquely satisfies the desire for ‘recognition’ that he locates at the heart of the historical process. Even so, his acknowledgment of the inadequacy of capitalist democracy does not go nearly far enough. There is a much greater and larger indictment to be drawn up against it, of which I can only suggest a few items here.

Let me begin by suggesting that capitalist democracy is a contradiction in terms, for it encapsulates two opposed systems. On the one hand there is capitalism, a system of economic organization that demands the existence of a relatively small class of people who own and control the main means of industrial, commercial, and financial activity, as well as a major part of the means of communication; these people thereby exercise a totally disproportionate amount of influence on politics and society both in their own countries and in lands far beyond their own borders. On the other hand there is democracy, which is based on the denial of such preponderance, and which requires a rough equality of condition that capitalism, as Fukuyama acknowledges, repudiates by its very nature. Domination and exploitation are ugly words that do not figure in Fukuyama’s vocabulary, but they are at the very core of capitalist democracy, and are inextricably linked to it.

One item which is nowadays very little mentioned is that capitalism is a system based on wage labour. Wage labour is work performed for a wgae in the service of a private employer who is entitled, by virtue of owning or controlling the means of production, to appropriate and dispose of whatever surplus the workers produce. Employers are constrained by various pressures that limit their freedom to deal with their workers as they will, or to dispose of the surplus they extract. But this merely qualifies their right to extract a surplus and to dispose of it as they think fit. This right is hardly ever questioned and is taken to be ‘natural’, just as slave labour was once thought to be. Wage labour is not slave labour, of course, but it is a social relationship that, from a socialist perspective, is morally abhorrent: no person should work for the private enrichment of another. Communist experience has amply demonstrated that public ownership of the means of production does not by itself do away with exploitation. But exploitation under public ownership is a deformation, for a system based on public ownership does not rest on and require exploitation; under conditions of democratic control, it provides the basis for the free and cooperative association of the producers. By contrast, exploitation is the whole purpose of economic activity under private ownership, which makes no sense if it is not to result in the private enrichment (whatever other purpose this may serve) of the owners and controllers of the means of that activity.

There is no question that domination and exploitation are constrained in capitalist democratic regimes, at least in advanced capitalist countries. But this has largely been the result of relentless pressure from below to enlarge political, civic and social rights in the face of efforts from above to limit and erode such rights.