John McTernan: A defiant voice gives hope in the end times

Slavoj Žižek, the Slovenian Marxist philosopher, and self-avowed atheist Christian, has a rockstar appeal, and had just delivered dazzled a capacity audience, the bulk of them under 30, with a talk lasting over an hour and a half.

Promoting his new book Living in the End Times (Verso, 20) he had ranged far and wide, using clips from The Sound of Music, Cabaret and Bertolucci's 1900 to illustrate his thesis that what the modern world needs more than anything else is Communism. In an evening in which he threw out a host of insights and provocations, each of which could have been turned into a lecture in itself, one above all has stuck in my mind.

Sketching the current historical context, Žižek suggested that we are only just seeing the final "loss" of the collapse of the Soviet Union. The most obvious was the end of the "workers' states"; the one we are living through now is the end of the social democratic welfare state. This observation has reverberated in my mind since then and I wonder whether he might just be right.

The oldest, and most honest (most anti-Stalinist) of the comrades in the Communist Party used to make this argument — that it was the existence of an alternative that kept capitalism honest. I always used to think that this was a fantasy. What we had in Britain (and Continental Europe) had been hard-earned by the electoral advance of social democratic parties underpinned by the growth of democratic trade unions. Nothing was owed to the corrupt dictatorships of the Soviet bloc, who immiserated their people and whose plans for invading Europe were kept in check only by the ultimate deterrent: Mutually Assured Destruction. And these were permanent, irreversible gains. The contest in modern politics was between varying modes of managing welfare, not whether or not it should exist or how to redraw its boundaries. The whirlwind speed of the coalition's plans to unmake the state have made me rethink my position.

There is something awe-inspiring about the ruthlessness with which Tory and Lib Dem ministers have set about their task. The Tories left office in 1997 with schools in England with outside toilets; now they close down school building programmes. Between 1992 and 1997 Peter Lilley, one of the best ever Tory social security secretaries, had one iron law — never take any money from existing recipients; now there's a race on to see how many benefits can be cut for current claimants.

Sir Keith Joseph created family credit because he believed that the working poor deserved a guaranteed standard of living; the coalition have savagely restricted the reach of tax credits and will impoverish the working poor.

What is it that gives them such confidence? Is it simply an opportunistic exploitation of the combination of born-to-rule upper class PM and DPM, a global economic crisis and the public's aversion to debt? No. Something more radical is going on. This is a genuine neo-liberal moment. (And all of you who accused New Labour of neo-liberalism — you know who you are — should hang your heads in shame.) And it is part of a far wider shift.

Notwithstanding the election of Barack Obama as US president there has been a steady growth in support for the centre-right across the West in response to the global financial crisis. The programmes of European governments are predicated on the permanent removal of entitlements. And in a strange role reversal it is the centre-right who have become utopian idealists; long gone the traditional (and admirable) conservative scepticism about totalising ideologies, the intellectual scepticism that doubts any politician who promises to solve all ills. Instead we have not just conviction politicians, but evangelical politicians — the pain must be deeper, the cuts faster, only then can we be saved.

In the face of this turbo-charged neo-liberalism, the centre-left are paralysed. It's only the old, old Left (the comrades again) who simply and straightforwardly say, "if the bankers caused the crisis, why do the workers have to pay?" And they're just ignored. No echo, however faint, on the centre-left; no answer, however shallow, from the centre-right.

What connects all these symptoms? Why can Thatcher's successors be more Thatcherite than she ever dared? Why have social democratic parties got no critique, let alone any electoral appeal? Why does no-one want to punish the bankers?

It's because we're in a new world. The collapse of the Soviet Union had two great and connected economic consequences. The Chinese Communist Party leadership vowed never to go down the route of glasnost and perestroika, so their unique blend of Adam Smith and Leninism was locked in. And across China and the former Warsaw Pact countries, about a billion new workers joined the world economy.

This new reserve army of labour has been the strongest weapon in the armoury of those who would reverse the last century's achievements in terms of welfare. In a way that Margaret Thatcher could only dream of, they can point to manufacturing jobs and capital moving to the East and say - There Is No Alternative.

So Žižek's insight can be traced in the contours of real economic change. What then of the future? His prediction was two-fold. That western political elites will maintain a sense of permanent economic emergency — a crisis being too good to waste.

And that the future is some version of China, Singapore or Berlusconi. Not a pretty thought. His answer? A 21st century communism.

This is of course a glorious, impractical dream. But the inspiring part of it is Žižek's refusal to accept the inevitability of a settlement in which pensions, wages, working conditions, welfare get systematically poorer although the country we live in gets richer. His is an argument based on a stark analysis of how deeply defeated progressives truly are today, yet he still gloriously says "No" to those who say this is inevitable. In that refusal is hope and that is the beginning of a fightback. zz