Please cite as:
Ozturk, Ibrahim. (2025). “Capitalist Disruptions and the Democratic Retreat: A US–EU–China Comparison.” Journal of Populism Studies (JPS). September 11, 2025. https://doi.org/10.55271/JPS000116
Abstract
The accelerating erosion of regulatory safeguards, widening wealth inequality, entrenched elite influence, and the proliferation of surveillance regimes mark a new phase in the global crisis of corporate capitalism—one that is narrowing the normative and institutional gap between liberal democracies and authoritarian states. Building on Karl Polanyi’s notion of the double movement and Fernand Braudel’s distinction between market exchange and capitalist domination, this article develops a comparative political economy framework to examine how structural disruptions in capitalism are reshaping global governance and fueling the rise of populist authoritarianism. The analysis contrasts the institutional trajectories of the United States, the European Union, and China, highlighting both convergent and divergent patterns in their responses to this systemic crisis. By integrating insights from political economy, comparative governance, and authoritarian studies, the paper advances a theoretical synthesis that explains the mechanisms of “authoritarian convergence” without reducing them to a deterministic path. It concludes that resisting this drift requires re-embedding markets within democratic institutions and forging a renewed, inclusive global social contract capable of constraining both corporate and state power.
Keywords: Corporate Capitalism, Authoritarian Convergence, Populism, Democratic Backsliding, Karl Polanyi, Double Movement, Fernand Braudel, Global Governance, Inequality, Regulatory Failure, Comparative Political Economy
By Ibrahim Ozturk*
1. Introduction: Capitalism, Crisis, and the Convergence of Systems
With the collapse of central planning and the global decline of communist ideology in the early 1990s—preceded by the wave of neoliberal deregulation in the early 1980s associated with the so-called Washington Consensus—liberal democracies came to be viewed not only as models of modern governance, marked by openness, transparency, and institutional pluralism, but also as systems capable of guiding countries such as China and, later, Russia toward a liberal worldview grounded in free-market economics and democratic governance.
After an initial period of reform—primarily in the economic sphere—beginning in China in the early 1980s and later in Russia in the early 1990s, developments appeared to support the anticipated trajectory of convergence, broadly continuing until the mid-2000s. However, the post-2008 Great Stagnation marked a decisive turning point, dispelling the “liberal fallacies” rooted in overoptimism and ideological faith in inevitable convergence. Not only did several countries once expected to converge begin diverging from liberal democratic norms, but many established democracies with market economies also started adopting features traditionally associated with authoritarian governance. Moreover, regimes long regarded as illiberal—such as China and Russia—demonstrated remarkable adaptability by integrating market mechanisms, digital innovation, and populist rhetoric into their authoritarian rule. Taken together, these developments underscore that liberal and authoritarian regimes are not merely coexisting but, in significant ways, are converging.
That is, as liberal regimes increasingly adopt features characteristic of illiberal governance, illiberal regimes have, in turn, successfully integrated into the market and globalization processes driven by corporate capitalism, while maintaining their authoritarian political systems. This two-way process—referred to in this article as reverse convergence—is rooted in a common underlying factor: the systemic crisis of corporate capitalism.
Economic activity, which ought to be embedded within society and regarded as an integral part of social life (Polanyi, 1944; Braudel, 1982; Block, 2003; Sandel, 2012), has instead come to be perceived as a narrow, detached sphere shaped by the immunization of the corporate capitalism (Greider, 1992 & 2003) through “financial fundamentalism” that Vickrey (1998) warned against. Increasingly, it is viewed as a domain dominated by elites, operating contrary to the broader public interest—or at least perceived as such by large segments of society.
Especially in the aftermath of the 2008 financial crisis, this perception has fueled a countermovement marked by diverse forms of critique. Despite their ideological differences, these critiques converge on a common theme: the call to restore the will of the “virtuous people” against unaccountable elites (Mudde, 2004; Laclau, 2005; Müller, 2016; Norris & Inglehart, 2019)—a formulation closely aligned with the core definition of populism. In this sense, the global reaction against corporate capitalism has been effectively appropriated and redirected by authoritarian populist forces (Fraser, 2017; Zuboff, 2019; Piketty, 2020; Brown, 2019).
Recent political and economic developments in the United States (US), the European Union (EU), and China—where these transformations are particularly pronounced—reflect dynamics long anticipated by scholars, most notably Karl Polanyi (1944) and Fernand Braudel (1984). Polanyi, through his concept of the “double movement,” explored how societies historically respond to the destabilizing effects of unregulated markets by demanding protective social and political countermeasures. Braudel, in turn, distinguished between market economies and hierarchical capitalism, highlighting how modern economic elites operate within spheres largely insulated from democratic accountability.
More recently, these foundational frameworks have been extended by scholars analyzing the rise of digital capitalism. Zuboff’s (2019) theory of surveillance capitalism, Wark’s (2019) notion of the vectoralist class, and Varoufakis’s (2023) concept of techno-feudalism each offer critical insights into how corporate power, digital infrastructures, and state capture are reshaping the structures of political authority. Building on the approaches of Polanyi and Braudel, this article investigates how structural transformations in global capitalism—particularly under the pressures of digitalization, the expansion of cyberspace, rising wealth and income inequality, and the ensuing populist backlash—have increasingly blurred the boundaries between regime types.
This study uses comparative case analysis to examine the US, EU, and China as key regions where the disruptions caused by corporate capitalism align with the rise of authoritarian populist strategies. Each case offers a unique way of managing, challenging, or exploiting the structural pressures of global capitalism. Through this comparative approach, the paper aims to explain why and how different political systems are increasingly adopting illiberal norms, such as centralized authority, elite entrenchment, and norm erosion, even as they officially support divergent ideologies.
The structure of the paper is outlined as follows. After this introduction, the next section details the theoretical framework behind the concept of reverse convergence. Section 2 examines the contributions of Polanyi, Braudel, and other key scholars, situating their ideas within the context of current global trends. Section 3 presents a comparative empirical analysis of governance patterns in the US, the EU, and China, utilizing policy documents, governance indicators, and regulatory frameworks. The final section presents the normative implications of these findings in a nutshell. The article ends with key policy implications and recommendations.
