There is a fine line between publicity and advertising. While anyone can see the difference between a full-page ad promoting a soft drink and a two-line classified offering part-time work, it is easy to slide from one mode into the other. This slippage between simple intermediation and a full-scale advertising campaign is what hampers thinking about the question. The classical theory underpinning the function of promotion is that of imperfect competition, or ‘non-price competition’, formulated in 1933 by the post-Keynesian economist Joan Robinson and, quite independently, by Edward Chamberlin of the Harvard School. Non-price competition occurs when, in conditions of oligopoly, the businesses concerned avoid a price war for the sake of their own profit margins, instead competing by promoting the products themselves, in particular by special offers. The increased promotional costs remain advantageous compared with the predictable alternative: loss of income through competitive price-cutting.

As to how effective advertising is in increasing sales, whether it is useful in the short or the long term, and how successful it may be in a contest with other promotional campaigns (‘voice share’ rather than ‘market share’): these questions have been under discussion for a century, with no conclusion in sight. The one thing certain, if we borrow a metaphor from physics, is that advertising is the channel through which money is transferred from industry and finance to the mass media: it is the ‘black box’ that takes in money and emits information. Advertising is the main instrument by which, especially in the twentieth century, the dominant economic interests have financed information. This link between money and information has appeared unbreakable, even in the most radical conception of press freedom: modernity has not succeeded in conceiving a means of creating pluralism in information that is not based on a plurality of economic powers. Hence the difficulty of conceiving pluralism of information in a regime of collective property.

In the latter half of the twentieth century, print journalism as a whole was relegated to secondary status in the economy, the business of ideological orientation, and even the relay of information. With this, the figure of the professional print journalist lost substance, supplanted increasingly by the TV correspondent. [...] This is the situation—one of steady, protracted decline—into which the internet and digital economy irrupted, priming a real paradigm shift in the financing of information. [...]

The product of the universities is ‘knowledge’; that of the newspapers ‘information’. In both cases it seems that the only means of finance is to be patronage, with an associated return to nobiliary privilege. The implication is that this knowledge, like this information, will be increasingly reserved for the new feudatories. Within this order there takes shape the idea that the functioning of our society no longer requires the existence of a very large stratum of trained and informed subjects, rather that knowledge and information can be produced and disseminated only for the (few) beneficiaries of the economic circuit. It’s possible to do without public opinion. A paradoxical outcome in an age that hymns the splendours of digital democracy from below, when the internet deceives with its circulation of truly feverish ideas.

[...] standard economic indicators no longer measure these problems—one reason why elites have been slow to react. Inflation hovers at 1 per cent, and the price of consumer goods has dived since 1985. But over the same period, the cost of health care and education has multiplied 600 times. Unemployment has fallen to low single digits since 2014, but almost one-in-five working-age adults is no longer looking, and thus goes uncounted, to the point that a higher share of French males are in full-time employment than American. This leaves them prey to heroin and painkillers like OxyContin, prescriptions of which have quadrupled since the late 1990s, leading to the type of mortality levels that Durkheim associated with a ‘civilizational break’. Job growth since 2008 has come in the informal sector, sucking retirees into the gig economy, to spend their pensionless golden years driving cabs as so-called private contractors. At the same time—Luce cites Branko Milanovic’s famous ‘elephant graph’—elite incomes have soared. Global cities, sucking in wealth and talent from their impoverished hinterlands, now sit ‘like tropical islands surrounded by a sea of resentment’. New York City, treated more as an asset class than a home by its 116 billionaires, lets 34,000 apartments sit vacant amidst a desperate clamour for housing. [...]

The Retreat of Western Liberalism sides with Dani Rodrik’s argument: ultimately, economic globalization is incompatible with national democracy. Either democracy must be globalized—but the insulated chambers of the EU show what that can look like in practice—or a degree of national determination must be restored. Luce sides with his former mentor Summers’ call for political elites to adopt a policy of ‘responsible nationalism’, rather than a deeper globalization. Against Thomas Friedman’s image in The Lexus and the Olive Tree, likening the nostrums of the Washington Consensus to a ‘golden straitjacket’—within which ‘your economy grows and your politics shrink’—Luce notes that straitjackets are for lunatics: no wonder Western democracies ‘have begun to lose their minds.’ [...]

So searing is the earlier indictment of contemporary America—and of the Davos mindset of ‘global governance’ and ‘multi-stakeholder collaboration’—that one might expect a climactic call to rethink liberalism from bottom up. Instead, Luce rallies to it. The entirely conventional capstone to the book sets out the reforms that will restore US politics as ‘the envy of the world’. In a book that takes elites to task for their complacency towards the lower orders, it is striking that Luce never sees fit to define the words western or liberalism, alone or together, or to tell us why they are superior to the alternatives—actual or potential. The ‘retreat’ of the title turns out to be unimaginable. All that is needed to reverse it are the standard vacuous fixes: vocational upgrades, no offshore tax havens, campaign-finance reform, carbon taxes, healthcare, if certainly no universal basic income; above all a ‘massive Marshall Plan to retrain the middle class’ for skills in a post-automated age. As Luce has explained elsewhere, this could be easily brought off on the model of Denmark, with high job turnover and two weeks’ free training a year for every adult.

Hobson is therefore at least as relevant for what he had to say about Britain, the leading imperial power of the day, where he posited a theory of under-consumption, in which the maldistribution of wealth at home, seeking outlets for investment abroad, undermined democracy and turned finance into the ‘governor of the imperial engine’. Luce accumulates ample evidence of such tendencies in his own weary titan—the baleful grip of Wall Street on Washington, the overreach of American empire—but declines to follow Hobson in drawing systemic conclusions from their coincidence. The crisis of the ‘middle class’ and ‘our democracies’ is one of economic growth, pur et dur, as if its social distribution were immutable, or without consequence for the rate of growth itself. The effect is to take both the mode and relations of production off the table: here everyone is middle class, even as more and more Americans see themselves as lower or working class; capitalism as such never appears once in the book. In contrast to Hobson, who saw socialism as one way to cut off fuel to the imperial engine and create a workers democracy, Luce disdains the political forces that have made rising inequality their battle cry. Corbyn is dismissed as ‘standing as much for unblinking nostalgia as Trump’, and his supporters are ‘as historically illiterate’ as ‘Trump’s army of “deplorables”’, if ‘less racist’. Luce is scandalized by Corbyn’s call to renationalize the railways, with overwhelming popular support—a measure ‘no sane cost-benefit analysis of Britain’s fiscal outlook’ would recommend. For Luce, the best result in 2017 was Emmanuel Macron’s ‘thumping victory’, a quinquennat that kicked off by slashing taxes on capital gains, cutting student benefits, reducing retirees’ pensions, and attacking railway unions.

In the twentieth century, the most influential narrative of decline belonged to Oswald Spengler, whose title Luce and Emmott reference, while moving in the opposite direction from it. Spengler, of course, scorned liberal intellectuals, advising young Germans ‘to turn from poetry to technology, from painting to the merchant marine, from epistemology to politics’. But in 1918 Spengler was at least clear on what he meant by the downfall of the occident, which is in part why Adorno called his reactionary critique of liberalism ‘superior in many respects to the progressive one’, since it saw in liberal ideals not a false promise, but a fraud. Luce never returns to the Berlin Wall to ask if it was ‘democracy’ that triumphed the day he scrambled atop it. In our age of decline, alas, even the books on decline are in decline.

[...] Rather than blame neoliberal economic policy, Tegmark shares Brynjolfsson’s view that the problem lies with the digital economy itself. Producing additional copies of digital products is essentially free: without having to pay for workers, companies may allocate the additional revenue to investors. To illustrate this ‘edge of capital over labour’, Tegmark points out that although Detroit’s Big 3—GM, Ford, Chrysler—generated almost exactly the same total revenue in 1990 as the Big 3 of Silicon Valley in 2014, Facebook, Google and Apple had nine times fewer employees than the auto giants and were worth thirty times more on the stock market. A counter-observation could be made that Taiwan’s Foxconn, which makes Apple iPhones and Google Pixels, employs ten times more staff than Apple and five times more than Ford. But in a possible world of permanent low employment, Tegmark is prepared to accept the need for compensatory mechanisms—a universal basic income, strong public services—so that redundant wage-labourers can taste at least a morsel of AI-generated wealth.