Giampaolo Conte, "A History of Capitalist Transformation: A Critique of Liberal-Capitalist Reforms" (Routledge, 2024)
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Welcome to the NewBooks Network.

Today I'm here with Dr. Gianpaolo Conte, who is an assistant professor in economic history at the University of Rome in Italy. And he has recently published a book with Routledge Press. The book is called A History of Capitalist Transformation, a Critique of Liberal Capitalist Reforms. Gianpaolo, welcome to New Books Network. Thank you.

Welcome. Welcome. Thank you very much. Thank you very much. Can you just, before we start talking about the book, very briefly introduce yourself and also tell us about the book, why you decided to write this book and what is it about in a very, very broad sense in a nutshell?

Yes, thank you very much. So, first of all, my field of research concerns the study of capitalist development process from a historical perspective, especially regarding the role of debt, money and public financing in general. In my investigation, I try to change the classical approach with a heterodox one, attempting

to give a critical view of the events I study. So studying the economy also means considering the so-called deep forces that influence it, such as politics, culture and society. This is the approach of my studies, which I have also tried to use in the book that we are discussing about.

The book highlights how since the 2008 financial crisis, the expression liberal reform has entered common manner of speaking as an evocative image of austerity and economic illness, especially for the working classes and part of the middle class. But what exactly does liberal reform refer to?

The research analyzes the historical origins of liberal capitalist reformism using a critical approach, starting with the origins of the Industrial Revolution onwards. So generally, the book demonstrates that the chief aim of such reforms was to integrate semi-peripheral states

into the capitalist world economy by imposing both directly and indirectly the adoption of rules, institutions, attitudes to economic and political interests of the capitalist elites and hegemonic states between the 19th and the 21st centuries.

As such, the reforms became an active tool used to promote social, economical, financial institutions, norms and lifestyles, typical of a liberal capitalist economic order, which locates some of these founding values in capital accumulation, profit-seeking and social transformation as well.

Thank you very much. That was a very good introduction to the book. But to give us like a sense of understanding what you mean by liberal capitalist economic reformism, can you tell us what it is? What is liberal capitalist economic reformism and its orders?

Sure. So I use in the book liberal and neoliberal capitalistic reforms to refer to the 19th century and the 20th century. So liberal capitalist reforms or neoliberal capitalist reforms are a sort of nonviolent process of capitalistic transformation.

Their aim was to facilitate the adoption of a broader neoliberal framework of rules, norms and ways of thinking. This would have involved making the labor market more flexible, very often by cutting labor rights, improving the tax collection system, often in a regressive way,

making welfare sustainable through an increase in the retirement age and liberalizing the service sector, even according to some of the positive welfare principles of Anthony Giddens. For example,

Countries with high public debt are advised to embark on a deep process of privatization and reorganization aimed at rationalizing the national economy according to the rules imposed by the neoliberal market.

So exploiting a state's weakness when a severe economic crisis wears it down is an easy solution and has often been sparked by the failure to comply with those norms and rules that are present and tacitly accepted in the capitalist world economy. And in this idea of reformism, you talk about the role of

The elites. Did this, let's say, trend of economic reformism started with them? And let's say, what is the role of elites in the reformist process? Yeah. So liberal capitalist reforms move on a vertical and horizontal track, just to image this sort of graphic.

vertically throw a top-down approach. That is when the new capitalist elite, inspired by a sort of universalistic rational ideology, assumes power as a new hegemonic class and helps transform and bend the underlying society to their capital accumulation needs.

And on the other hand, horizontally, when the elite of the hegemonic state ally themselves with the emerging class in the countries of the semi-peripheral to increase their bargaining power and profit share, although the elite in core countries often maintain structural supremacy over the others worldwide,

At the same time, such action helps increase the economic clout of the elite in a semi-periphery by increasing their political influence.

strengthening political clout means these elite have direct access to state power. So we have a sort of transnational alliance between capitalistic elite in the core countries and in the semi-peripheral countries. And we see this sort of alliance just for the benefits of capitalists

capital accumulation in the core country and in semi-peripheral countries as well. Let me ask a question about the difference between liberal capitalist internal and external reforms. What do you mean by internal and external reforms? Yes, so... So...

Reforms act both internally and externally within the state. But let's go direct to the point. So according to Antonio Gramsci, the hegemonic capitalist class first

takes power and then shapes societies according to its prerogatives. Its aim is its power just enough to keep it in power. Internal reformism works in this way. For example, when the capitalist industrial bourgeois became hegemonic in England, mainly at the end of the 18th, at the beginning of the 19th century,

It created a whole series of laws, institutions and cultural models that were functional to the class interest and capital accumulation. For instance, the full-fledged recognition of private property, the income tax, the step-by-step monopoly of currency, printing and so on.

On the other hand, external reformism is when the Germanic class in the capitalist countries attempts to copy the capitalist class in foreign state by helping it to seize power. If this happens, the reforms serve not only to legitimize the new capitalist class by giving it power and wealth,

think of the Coupe d'Etat in Pinochet's Chile, but also to benefit the hegemonic elites in the capitalist states who gain direct advantages from these transformations. And I'm also curious to know why in the book you focus on liberal capitalist reforms, because the question that I might have is,

Are liberalism and capitalism the same thing when it comes to economic reformism? Well, this is a tricky point. So generally speaking, capitalism and liberalism could be defined as a sort of misleading match. I would like to introduce this topic in this way. So the similarity between liberalism and capitalism is often taken for granted. The problem is not liberalism itself.

was ideological harmony perfectly fits into the theoretical world, but the practical need for capital accumulation. So capitalism exploits liberal ideology, often mystifying its meaning because it treats its needs better. According to one of the leading Italian intellectuals, Ugo Spirito,

Capitalism and liberalism historically and highly have the exact origin and value. However, the same ideal of freedom has progressively defined itself as an ideal of private liberty.

that is of the individual within a specific particular field of action, outside of that social organism in which it is defined, and therefore outside of the state, which becomes the mere guardian of the boundaries of individual properties. Just to sum up, capitalism exploits liberal ideology to better pursue its needs for capital accumulation,

at least for the time being. And what is world system theory? Because the theoretical basis of the book is based on world system theory and Gramsci's concept of hegemony. I'm myself familiar with Gramsci's concept of hegemony, but not so much world system theory. And why are they relevant? Yeah, so I tried...

I don't know if successfully or not, to combine both. So the world system theory and the Gramsci concept of hegemony. So the world system theory allowed me to define the general framework of studying the reform process.

while Gramsci's theory of hegemony was instrumental in defining the process of hegemonic groups gaining power, which is fundamental to the capitalist revolution in Europe and beyond. So the world system theory is the framework.

The capitalist world economy works according to the rule of capital mobility, labor forces, capitals, and so on. And the Gramsci's theory of hegemony is much more related to the social structure within a defined society. So,

To analyze the evolution of the capitalist social class within its own country of reference, we resort to Antonio Gramsci's category of hegemony. So just to sum up, once the bourgeois class assumes power, it shapes the society below and those nearby the border of these military positions and strongholds.

The transformation that occurred is based on a system of rules that allows for the reproduction of the capitalist class structure and preserves its dominant position within society and the market in the years to come. It's not only a matter of promoting the adoption of capitalist production systems,

that is capital accumulation, recognition of private property, etc. But of making such instruments a means for the hegemonic class to gain the most significant advantage before all other social forces. It means, in a nutshell, creating a structure of

Sovereign National interconnections networks capable of favoring the interest of the capitalistic class. And so how do reforms work in practice? The book shows that this liberal capitalist reforms act through the transnational alliance of capitalist elites and sovereign states. Can you elaborate on this point?

Sure. So exactly. When elites become hegemonic and take power, they become one with the state. This means that the state and its military and diplomatic forces, but also to a lesser extent economic and cultural forces, act on behalf of and through the state.

Without the state so defined, capitalist reformists wouldn't exist.

In fact, no matter how much reform wants to persuade society of the goodness of these ideas, the military threat is still one of the strongest power in the hands of the capitalistic state. So it's a sort of acting according to a soft power than the hard power. But at the end is the hard power that force the

other states to pursue this kind of laws and so on. Okay. Yeah. And the book mainly refers to the historical origins of liberal capitalist reformism. But are there also commonalities between what happened in the wake of recent financial crisis, for example, in European Union? Yeah, sure. So

We can see that there are many similarities. In fact, the book aims to trace the origins of a type of liberal capitalist reformism that European populations have undergone without having a collective awareness of it. In the case of post-2008 crisis, we witness the perfect example of a mix between internal and external reformism.

That is, national elites in peripheral countries like Greece, Portugal and Spain accepted liberal capitalist reform policies beneficial to their own profits and those of the liberal capitalist elites in the stronger core countries such as Germany, the Netherlands and partly France.

there was a strong push for liberalization, privatization and fiscal austerity, but only for labor income, not capital income, which only served to increase inequality and consequently the growth of nationalist and populist parties on the right. This is one of the main dangers, of course. And why do liberal capitalist reforms give an advantage to wealthier classes and

even though they see proposals and promises as functional to improving the living conditions of the entire population? Well, I would like to introduce this question with the general understanding. Generally speaking, these liberal capitalist reforms are presented as useful for everyone to gain the masses' consent.

As Eric Fromm reminds us, the fear of social downgrading drives the small bourgeois. The group must expose to these fears to more easily believe what a supposed savior tells them to do. We were told that the self-regulating market would save us from the delusions and crises caused by the same self-regulating market.

This was the tale told. We believe it because the liberal capitalist elites controlling the press, the major media and political and part of the cultural world made us believe this. Not only that, as in the 19th and 20th centuries, the threat following these reforms was no longer military but economic. If we don't cut pensions and wages today,

privatized healthcare, education, etc., there will be serious consequences for everyone and our well-being. After a few years, the reform showed itself to be nothing more than a toll for the class interests of the wealthiest, to the disadvantage of the rest of the population.

According to a class structure, financial reforms ended up being more functional to the economic interests of the financial class than to those of the middle and lower classes.

However, they act with different timing in regard to different social and class aims. The liberal capitalist reforms in the two preceding decades were aimed at continuing to extract value from the middle and working classes in order to sustain the high process of capital accumulation by the capitalistic elites and capital holders.

Market discipline and structural adjustment becomes the two mantra of our society in permanent crisis. So external neoliberal capitalist reforms is not natural factor, but a clear expression of particular and well-defined class interests. In other words, of the capitalistic elites.

Dr. Jan-Paul Canté, thank you very much for taking the time to talk with us on New Books Network about your book. The book we just discussed is called A History of Capitalist Transformation, a Critique of Liberal Capitalist Reforms, published by Routledge University Press. Thank you very much for your time. Thank you to you. Thank you very much.