i Democracy Against Domination ii iii Democracy Against Domination K. Sabeel Rahman 1 iv 1 Oxford University Press is a department of the University of Oxford. It furthers the University’s objective of excellence in research, scholarship, and education by publishing worldwide. Oxford is a registered trade mark of Oxford University Press in the UK and certain other countries. Published in the United States of America by Oxford University Press 198 Madison Avenue, New York, NY 10016, United States of America. © Oxford University Press 2017 All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, without the prior permission in writing of Oxford University Press, or as expressly permitted by law, by license, or under terms agreed with the appropriate reproduction rights organization. Inquiries concerning reproduction outside the scope of the above should be sent to the Rights Department, Oxford University Press, at the address above. You must not circulate this work in any other form and you must impose this same condition on any acquirer. Library of Congress Cataloging- in- Publication Data Names: Rahman, K. Sabeel, 1983– author. Title: Democracy against domination / K. Sabeel Rahman. Description: New York : Oxford University Press, [2016] | Includes bibliographical references. Identifiers: LCCN 2016022380 | ISBN 9780190468538 (hardcover : alk. paper) Subjects: LCSH: United States—Economic polic—2009– | United States—Economic policy—Citizen participation. | Democracy—Economic aspects—United States. | Capitalism—Political aspects—United States. | Equality—Economic aspects—United States. | Financial services industry—Law and legislation—United States. | United States—Economic conditions—2009 Classification: LCC HC106.84 .R34 2016 | DDC 338.973—dc23 LC record available at https://lccn.loc.gov/2016022380 9 8 7 6 5 4 3 2 1 Printed by Sheridan Books, Inc., United States of America v We have frequently printed the word Democracy. Yet … it is a word the real gist of which still sleeps, quite unawakened, notwithstanding the reso- nance and the many angry tempests out of which its syllables have come, from pen or tongue. It is a great word, whose history … remains unwritten, because that history has yet to be enacted. — Walt Whitman, “Democratic Vistas” (1871) vi vii CONTENTS Preface ix Acknowledgments xiii 1. Democracy, Domination, and the Challenge of Economic Governance 1 2. Managerialism and the New Deal Legacy 31 3. The Progressive Critique of the Market 54 4. Economic Domination and Democratic Action 78 5. Structuring Democratic Agency 97 6. Anti- Domination as Regulatory Strategy 116 7. Democratic Agency as Regulatory Process 139 8. Democratic Freedom in the New Gilded Age 166 Notes 181 Bibliography 211 Index 227 viii ix PREFACE On January 3, 2008, Barack Obama won the Iowa caucus, kicking off what would become one of the most remarkable and surprising primary seasons in American politics. As he took the stage late that night to thank his sup- porters, he set aside the symbolism of his role as an African- American can- didate with a multi- racial and global background. “I know you didn’t do this for me,” he told his supporters. “You did this because you believed in the most American ideas—t hat in the face of impossible odds, people who love this country can change it.” His campaign slogan, “HOPE,” was to Obama, not a plea for blind faith but rather a call to action: Hope is what led a band of colonists to rise up against an empire. What led the great- est of generations to free a continent and heal a nation. What led young women and young men to sit at lunch counters and brave fire hoses and march through Selma and Montgomery for freedom’s cause… . Hope is the bedrock of this nation. The belief that our destiny will not be written for us, but by us, by all those men and women who are not content to settle for the world as it is, who have the courage to remake the world as it should be… . [the belief that] brick by brick, block by block, callused hand by callused hand, … ordinary people can do extraordinary things.” It was a thrilling moment, and a singular political experience for me as I sat with friends huddled in the bitter cold of another Cambridge winter listen- ing on the radio. Over the next few months, I, along with millions of other Americans, watched in fascination and growing excitement as Obama’s campaign marched from state to state. In the protracted battle with Hillary Clinton over the Democratic nomination, it became a campaign not just for an individual but for this aspiration to transformational, rather than incre- mental, change—t o collective democratic action. Meanwhile, trouble was already brewing in the American economy. The collapse of Bear Stearns marked an increasingly panicked effort by regula- tors and financiers to stave off a larger financial collapse, which came in full force that September with the fall of Lehman Brothers. Often overlooked