The emergence of the stagflation age

The 1960s ended with a worldwide escalation of social conflicts, aimed to fight the dominant elites in both capitalist and Soviet-bloc countries. Mass movements grew in the United States and in most European countries. The baby boom and, in Europe, the end of the golden age associated with postwar recovery fueled social tensions supported by the alliance of students, blue-collar workers, and other social categories. In the famous May 1968 protests, students lined up with wildcat strikes of up to ten million workers that froze economic and political activity in France. Eastern Europe also experienced widespread protests that escalated, particularly in the Prague Spring in Czechoslovakia, and ended up with the Soviet invasion. The Great Proletarian Cultural Revolution characterized the Chinese scene between 1966 and 1976.

The protests of 1968 can be interpreted as a reaction against state centralization, which itself was the social answer to the authoritative regimes of the interwar period. After the war, developed societies experienced a need for collective freedom which led to the creation of large welfare states, Keynesian policies, the advent of mass culture through the media development, education policies and, in general, a large public intervention in the citizens’ lives.

In the 1970s, the developed societies began to face a deep crisis. New problems and new needs emerged. On the one hand, the relationship between economic development and the domestic nature of postwar capitalism entered into a crisis due to the increase in public spending and the limits to the system of capitalist accumulation. On the other hand, people from the newly educated masses began to search for individual freedoms refusing and contrasting the ideas of a homogenous centralized framework.

The complex society, forged to implement an integral and universal social protection system “from cradle to grave,” extended the space of individual autonomy, raising the level of education and the improvement of living conditions. However, it also strengthened the rules and the invasive tendency of the state apparatus. The extended welfare state was built not only to favor certain groups but also because it was needed for a well-functioning society (Foucault, 2008).

The need for individual freedom found its economic expression in new ideas that emphasized the market virtue.