We are all neoliberals now.

April 15, 2016 6:05 AM

Imagine if the people of the Soviet Union had never heard of communism. The ideology that dominates our lives has, for most of us, no name. Mention it in conversation and you’ll be rewarded with a shrug. Even if your listeners have heard the term before, they will struggle to define it. Neoliberalism: do you know what it is?
posted by Grangousier (65 comments total)

Something else happened during this transition: the movement lost its name. In 1951, Friedman was happy to describe himself as a neoliberal. But soon after that, the term began to disappear. Stranger still, even as the ideology became crisper and the movement more coherent, the lost name was not replaced by any common alternative.

It is necessary for neoliberalism to go nameless as much as possible because one of its core strategies has been to disguise itself as common sense. Monbiot quotes Margaret Thatcher's slogan "There is no alternative", but doesn't point out the true horror and dishonesty of the phrase. Neoliberals do not, as communists or Keynesians or fascists do, promulgate their positions under the banner of an ideology- the idea of their ideology even being an ideology is repulsive to them. Key to its success- to the way neoliberalism has been able to worm its way into even the nominally left parties- has been to suggest that neoliberal policies are not ideological but simple pragmatism. How can something be an ideology when there is no alternative? Is eating an ideology? Is breathing? To admit that neoliberalism is an ideology would give the game away and admit that it is merely an ideology, and to allow its victims a target to aim at. Instead the neoliberals pretend that they are merely doing what must be done, and encourage us to believe that the great invisible beast eating us alive is only the aging process, something natural, something which nobody can rationally object to.
posted by Pope Guilty at 6:20 AM on April 15, 2016 [149 favorites]

Neoliberalism would be bad enough if it actually existed.

A world of endless competition, where the weak, incompetent, or stupid are crushed by the powerful and clever, would be bad.

What makes the world that we actually live in even worse is that the people espousing neoliberalism and the free market don't even believe in these things themselves.

There's no such thing as a free market. Socialist structures and government intervention are used by the rich and powerful to further enrich themselves every day.

In a truly free market, most of the auto industry and many of the world's largest banks would have been badly damaged or even destroyed in 2008. That didn't happen, of course, because they were given billions of dollars out of the public purse.

It isn't a matter of ideology, it's all about which direction the money is flowing in.

We live in a kleptocracy, and we need a revolution.
posted by crazylegs at 6:20 AM on April 15, 2016 [46 favorites]

Slavery. I mean, freedom!
(im on a list now, aren't i?)
posted by entropicamericana at 6:20 AM on April 15, 2016 [2 favorites]

There's no such thing as a free market. Socialist structures and government intervention are used by the rich and powerful to further enrich themselves every day.

You have no idea what socialism is.
posted by Pope Guilty at 6:25 AM on April 15, 2016 [8 favorites]

Socialism is as much a brand and epithet as it is anything else these days.
posted by ZeusHumms at 6:28 AM on April 15, 2016 [1 favorite]

when big businesses create laws that limit competition, it makes me wonder if that is a failing of neoliberalism, or just playing the game at a higher level. It seems to be playing at such a high level that only the top players can play. But that is true of many games. Does that mean the game has changed? No.... but it also doesn't feel like the same game. Pro players play against pro, dan against dan, and kyu against kyu. Us 20 kyu players.... our only hope is to beat some 21 kyu in order to get enough to survive, but it's not even remotely related to the type of survival the pros are enjoying and competing for.
posted by rebent at 6:28 AM on April 15, 2016 [5 favorites]

You're right actually, that was a bad choice of words.

Socialist Unjust financial structures and government intervention are used by the rich and powerful to further enrich themselves every day.

FTFM
posted by crazylegs at 6:29 AM on April 15, 2016 [19 favorites]

Neoliberalism would be bad enough if it actually existed...It isn't a matter of ideology, it's all about which direction the money is flowing in...We live in a kleptocracy, and we need a revolution.

How would a revolution change that underlying dynamic, if people's beliefs don't actually have any causal power or demonstrable ontology in the first place?
posted by clockzero at 6:32 AM on April 15, 2016 [3 favorites]

I liked the kleptocracy part.

"there is clearly a big financial upside to lying"
posted by sneebler at 6:34 AM on April 15, 2016 [6 favorites]

I got a lot out of these Philip Mirowski videos. He's a History of Economics prof in Indiana. I think the important point he makes is that Neoliberalism is a project, and that project has a history and an influential network of think tanks who promote these ideas.

The Biopolitics of the Biosphere Crisis

Keynote for 'Life and Debt' conference
posted by sneebler at 6:47 AM on April 15, 2016 [16 favorites]

John Kenneth Gailbraith noted that we have capitalism for the middle class and socialism for the corporations and very wealthy
posted by Postroad at 7:04 AM on April 15, 2016 [19 favorites]

Now 70+ years on, Hayek's book is revealed as the embodiment of the big lie. The Road to Serfdom is actually paved by the very policies he espouses. People as independent economic agents, a free and transparent market, competition which is fair, despite disparities in financial status, all lies and fantasy. None of these things exist. A government that works for the people, people banding together as unions, political parties, etc. to demand equal treatment, regulation to rein in inherent human greed and venality, all are anathema to the dictatorship of capital.

I was going to go to Gailbraith but @Postroad beat me to it (vide supra).
posted by sudogeek at 7:09 AM on April 15, 2016 [13 favorites]

Its anonymity is both a symptom and cause of its power.

I sense this every time the seemingly neutral, non-descript term "reform" is used to cloak the specifically neoliberal objective of cutting the public sector.

* Education "reform" = privatizing education
* Tax "reform" = cutting government revenues (from the wealthy)
* Social security "reform" = cutting public retirement insurance
* Labor market "reform" = deregulating, removing government protections of workers
* Etc.

Politicians and the media almost never specify what's meant by "reform" but it's been on the agenda since i can recall and whomever is advocating it is typically treated in a positive fashion, at the least as having substantive, serious ideas about how to address society's ills.

Let's all consider once again whether it's time for some reform.
posted by airing nerdy laundry at 7:14 AM on April 15, 2016 [32 favorites]

In before "nothing neo about liberalism" spiel.

/the trots are right
posted by the man of twists and turns at 7:15 AM on April 15, 2016 [2 favorites]

Neoliberalism is a umbrella term for a lot of different things. It suffers for being vague enough to describe a lot of policies you like but also sometimes getting associated with a lot of policies you hate. If you hate neoliberalism you probably hate Vox, even though they do evil things like argue for massive increases in government like Obamacare. The Affordable Care Act is not a socialized provider system like the British National Health Service, and so is neoliberal. But single-payer, like Canada, is also neoliberal, because markets.

For instance, I often champion the universal basic income guarantee. Is that neoliberalism? In some circles, it is. After all, Friedman also championed it, and it depends on the idea that poor people can make their own decisions and the claim that the welfare state enriches the middle class while giving us power over the poor and feeding into the prison industrial complex. But Martin Luther King also liked it. Was King a neoliberal?
posted by anotherpanacea at 7:26 AM on April 15, 2016 [8 favorites]

We live in a kleptocracy, and we need a revolution.

You cannot have it (and are not even deserving of it) because you (the collective in this forum, as well as the population at large) will not do what is necessary to enact it: name names, individualize the struggle (via shaming, and/or other means if need be), engage in the struggle with the same intensity and ruthlessness your enemies perpetrate on you every single day of your life.
posted by Chrischris at 7:32 AM on April 15, 2016 [3 favorites]

Slavery. I mean, freedom!

War is Peace.
Freedom is Slavery.
Ignorance is Strength.

I guess that makes Trump and Sanders the Emmanuel Goldsteins of their respective markets.
posted by otherchaz at 7:35 AM on April 15, 2016 [1 favorite]

I quite like George Monbiot's summary/definition of "neoliberalism":

"Neoliberalism sees competition as the defining characteristic of human relations. It redefines citizens as consumers, whose democratic choices are best exercised by buying and selling, a process that rewards merit and punishes inefficiency. It maintains that “the market” delivers benefits that could never be achieved by planning.

Attempts to limit competition are treated as inimical to liberty. Tax and regulation should be minimised, public services should be privatised. The organisation of labour and collective bargaining by trade unions are portrayed as market distortions that impede the formation of a natural hierarchy of winners and losers. Inequality is recast as virtuous: a reward for utility and a generator of wealth, which trickles down to enrich everyone. Efforts to create a more equal society are both counterproductive and morally corrosive. The market ensures that everyone gets what they deserve."

posted by Mister Bijou at 7:42 AM on April 15, 2016 [22 favorites]

Is "neoliberalism" just another name for libertarianism? From the article:

The term neoliberalism was coined at a meeting in Paris in 1938. Among the delegates were two men who came to define the ideology, Ludwig von Mises and Friedrich Hayek. Both exiles from Austria, they saw social democracy, exemplified by Franklin Roosevelt’s New Deal and the gradual development of Britain’s welfare state, as manifestations of a collectivism that occupied the same spectrum as nazism and communism.

In The Road to Serfdom, published in 1944, Hayek argued that government planning, by crushing individualism, would lead inexorably to totalitarian control. Like Mises’s book Bureaucracy, The Road to Serfdom was widely read. It came to the attention of some very wealthy people, who saw in the philosophy an opportunity to free themselves from regulation and tax. When, in 1947, Hayek founded the first organisation that would spread the doctrine of neoliberalism – the Mont Pelerin Society – it was supported financially by millionaires and their foundations.

Because libertarianism -- the harmony of interests; government is the problem, not the solution; taxation is theft -- is definitely a recognizable ideology.

But when I've seen the term "neoliberalism" thrown around, it usually seems like a more general term used by the Left to mean any ideology which supports capitalism, including for example social democracy. Paul Krugman, for example. A Jacobin article:

Finally, Mirowski argues that the Left has too often been sucked in by neoliberalism’s loyal opposition. Figures like Joseph Stiglitz or Paul Krugman, while critical of austerity and supportive of the welfare state, accept the fundamental neoclassical economic precepts at the heart of neoliberal policy. Mirowski argues that we must ditch this tradition in its entirety.

Which I would argue against. When properly regulated competitive markets exist, they're awesome. The sellers in a competitive market are stuck in a collective action problem: if they could cooperate and raise prices, they'd all be better off, but they each have a free-rider incentive to lower prices and sell more. And when you have a collective action problem, you can get amazing results: my favorite example is trees in a forest, which rise to astonishing heights because they're competing for sunlight. Collectively they'd get the same amount of sunlight if they were only five feet tall.

Similarly, employers are competing as buyers for labor. If they could form a buyers' cartel and hold wages down, they'd be better off. Which is exactly why such cartels are illegal, and why it's important to have institutions to uncover them and break them up. (There were a couple recent examples that Apple was involved in: on the buyer side, colluding with competitors to not poach employees from each other; on the seller side, colluding with book publishers to fix e-book prices.)

Joseph Heath, a Canadian political philosopher, is an extremely strong defender of the Canadian status quo, including the welfare state: public health insurance, public pensions, public education. The best explanation I've seen of the benefits of competitive markets is in Heath's The Efficient Society. He notes that we've produced more material goods since the late 1800s than in all of human history before that point.
posted by russilwvong at 7:48 AM on April 15, 2016 [13 favorites]

You cannot have it (and are not even deserving of it) because you (the collective in this forum, as well as the population at large) will not do what is necessary to enact it: name names, individualize the struggle (via shaming, and/or other means if need be), engage in the struggle with the same intensity and ruthlessness your enemies perpetrate on you every single day of your life.

Man, am I bored of this brand of holier-than-thou political shaming. We're Americans, for chrissakes - we've had decades and decades of economic warfare by the rich coupled to an educational system, a media, and resulting culture that does nothing but demoralize, shame, and distract us, and is weaponized to breed passivity and atomization by convincing us that we, individually, at the root of all of our personal problems - especially the economic ones. So, no - we have no modern tradition of revolution, none of the related ideas have any mass currency here, and consequently - you're right - this is not a revolutionary moment.

You know what would help make change? Investing effort in convincing people that they aren't helpless, aren't stupid, and aren't worthy of contempt. That they have agency and the potential for power. That the neoliberal project is leech on their necks and they can very damn well tear it off if they put their minds and backs into it.
posted by ryanshepard at 7:56 AM on April 15, 2016 [31 favorites]

This, a thousand times this:

Another paradox of neoliberalism is that universal competition relies upon universal quantification and comparison. The result is that workers, job-seekers and public services of every kind are subject to a pettifogging, stifling regime of assessment and monitoring, designed to identify the winners and punish the losers. The doctrine that Von Mises proposed would free us from the bureaucratic nightmare of central planning has instead created one.

You know where you can stick your New Public Management?
posted by brokkr at 8:06 AM on April 15, 2016 [12 favorites]

From the article:

Neoliberalism’s triumph also reflects the failure of the left. When laissez-faire economics led to catastrophe in 1929, Keynes devised a comprehensive economic theory to replace it. When Keynesian demand management hit the buffers in the 70s, there was an alternative ready. But when neoliberalism fell apart in 2008 there was ... nothing. This is why the zombie walks. The left and centre have produced no new general framework of economic thought for 80 years.

Every invocation of Lord Keynes is an admission of failure. To propose Keynesian solutions to the crises of the 21st century is to ignore three obvious problems. It is hard to mobilise people around old ideas; the flaws exposed in the 70s have not gone away; and, most importantly, they have nothing to say about our gravest predicament: the environmental crisis. Keynesianism works by stimulating consumer demand to promote economic growth. Consumer demand and economic growth are the motors of environmental destruction.

Again, I'm not sure what Monbiot means by "the left" here. Does it include liberal democrats like Paul Krugman, who have been arguing for Pigovian taxes for decades?

Joseph Heath again:

Incidentally, I happen to agree that some women who wear a niqab are doing it in order to engage in some kind of symbolic rejection or resistance to Western values. But here’s the thing… I don’t care. I am completely unperturbed. I have lots of colleagues who go railing against “the West” and its values all the time. That doesn’t bother me either. Why? Because of my serene self-confidence as a Westerner. Simply put, I believe that the basic structure of liberal-democratic societies, which includes a market economy, welfare state, individual rights, electoral democracy, and separation of church and state, obviously and self-evidently dominates all known alternatives (“dominates” in this context means “is better in every respect”). The fact that people want to flail around a bit before accepting the inevitable is not something that troubles me very deeply. The ability to tolerate niqabs, hijabs, turbans, or whatever else people want to wear, is a sign of the profound strength of liberal democratic societies.

I would argue that we should be trying to push the US and the UK from libertarianism/free-market fundamentalism back towards social democracy, not trying to invent some completely new economic theory. In particular, Heath has a much less complimentary view of Naomi Klein's This Changes Everything.
posted by russilwvong at 8:10 AM on April 15, 2016 [11 favorites]

When Hayek called his book The Road to Serfdom, one might assume that the title was intended to be a warning. However, it's turned out to be a set of directions.
posted by Grangousier at 8:12 AM on April 15, 2016 [24 favorites]

The other convenient thing about neoliberalism and other ideologies that pretend not to be ideologies is that their critics often end up sounding like conspiracy theorists. Even when "they" demonstrably exist and are, in fact, out to "get" you.
posted by tobascodagama at 8:16 AM on April 15, 2016 [8 favorites]

I would argue that we should be trying to push the US and the UK from libertarianism/free-market fundamentalism back towards social democracy, not trying to invent some completely new economic theory.

You'd get my vote. This is what I have been arguing for the last decade--that democratic socialism not only isn't the enemy, but might be our best hope. But America's shot through with examples of people working around the rules established to prevent corruption and labor exploitation to create new power structures that function in ways that achieve the same exploitative ends while staying nominally on the right side of the law. Our version of Federalism, which defers so much authority down to lower levels of government, creates so many different vectors for unscrupulous actors to exploit, it's almost impossible to implement big picture policies uniformly and effectively. And when collusion does come to light--as it did a little while back when some tech companies were discovered to be colluding to keep wages down and limit the mobility of their workers--the consequences aren't very severe and it's all too easy for the more politically sophisticated in our society to exploit social resentment (for example, portraying IT workers as a privileged elite, when in fact, the elites with meaningful political and economic power are much less visible in our society, and far more powerful than most stereotypical "tech bros" will or could ever be) to make the public dismissive of the seriousness of the offenses.
posted by saulgoodman at 8:41 AM on April 15, 2016 [9 favorites]

Again, I'm not sure what Monbiot means by "the left" here.

Maybe something more along the lines of Canada's NDP which, having tired of losing on principle, prefers to lose by weakly and transparently caricaturing the positions of neoliberal parties.
posted by klanawa at 9:16 AM on April 15, 2016 [2 favorites]

Darkly informative article.
posted by Oyéah at 9:17 AM on April 15, 2016

The most pernicious thing about neoliberalism, and I think what distinguishes it from libertarianism and other forms of market fundamentalism, is how it gets treated as a moral system. Thus, it's ok to subvert democracy, because if democratic proceedings lead to processes or outcomes that are not neoliberal, they are not moral.

That's how you get examples like Pinochet, but also more "normal" examples like the Citizens United decision.
posted by Ray Walston, Luck Dragon at 9:58 AM on April 15, 2016 [10 favorites]

Socialism is as much a brand and epithet as it is anything else these days.

Only in the USA. In the rest of the world (which honestly does exist, really) Socialism is actually a thing.
posted by feckless fecal fear mongering at 10:11 AM on April 15, 2016 [3 favorites]

But single-payer, like Canada, is also neoliberal, because markets.

I have never in my life heard anyone use that word to describe Canada's health care system (although there are a few specific, non-essential elements of the system that you could label that way, like monthly premiums and certain styles of managerial thinking). Is this really something that comes up in debates over single-payer in the US?

If anything, health care in Canada is a prime example of how (a) you can absolutely have market components in a system that is not "neoliberal," and (b) socialization can provide more efficient results than more purely market-driven, neoliberalism-friendly systems.

It's true that the word "neoliberal" gets thrown around a lot and is often applied loosely, like the word "fascist." But as George Monbiot is pointing out, it does actually refer to a specific, more-or-less coherent ideological system. Describing Canadian health care as neoliberal, or calling MLK a neoliberal because he advocated a policy also proposed by some neoliberals, is just an error.
posted by Gerald Bostock at 10:16 AM on April 15, 2016 [15 favorites]

Monbiot's own politics are utterly incoherent as far as I've ever been able to tell, but he's definitely against a lot of the right things. Always useful to be reminded that ideology works when it's invisible and unnameable, and the effort to make a name stick to the false obviousnesses of our era — market-fundamentalism, austerity, and TINA — is politically valuable and worthwhile in its own right.
posted by RogerB at 10:48 AM on April 15, 2016 [2 favorites]

Sometimes I wonder whether serfdom wouldn't be preferable. Excellent job security and it might be nice to work outdoors.
posted by Cassettevetes at 10:48 AM on April 15, 2016

I mean, I get where you're coming from, but a system that people fought and died to escape probably isn't all that great.
posted by tobascodagama at 10:59 AM on April 15, 2016 [1 favorite]

Is "neoliberalism" just another name for libertarianism? From the article:

This paragraph is not too far off:

Those who are influenced by Hayek, Mises and Friedman tend to reject the term, maintaining – with some justice – that it is used today only pejoratively. But they offer us no substitute. Some describe themselves as classical liberals or libertarians, but these descriptions are both misleading and curiously self-effacing, as they suggest that there is nothing novel about The Road to Serfdom, Bureaucracy or Friedman’s classic work, Capitalism and Freedom.

Plus in the U.S. "libertarianism" may flirt with parts of the Jacksonian or Jeffersonian traditions that are not as popular with the political elite - like distrust of banking. Neoliberalism generally loves banking.

I also think the Left puts more weight on the term than it can really bear though.
posted by atoxyl at 11:00 AM on April 15, 2016

If anything, health care in Canada is a prime example of how (a) you can absolutely have market components in a system that is not "neoliberal," and (b) socialization can provide more efficient results than more purely market-driven, neoliberalism-friendly systems.

In fact, the worst parts of the Canadian single-payer system are that it allows doctors to pretend to be independent businesses and that the provinces can live out their neoliberal fetishes through it (the "progressive" premium schedule cuts off at $30k. Two people making $30k and $1million pay the same premium.)
posted by klanawa at 11:03 AM on April 15, 2016

russilwvong: The best explanation I've seen of the benefits of competitive markets is in Heath's The Efficient Society. He notes that we've produced more material goods since the late 1800s than in all of human history before that point.

That may be true as far as it goes, but you can be extremely efficient at making concrete lifejackets if you never stop to question whether what you're doing is effective. Having never having read the work in question, I wonder if it addresses the fact that this massive explosion in material goods has been bought at the cost of enormous social, environmental and financial externalities which are now becoming apparent to us all. The markets didn't create this material out of nothing by a wave of their invisible hands. They consumed our common resources and sold it back to us for private gain and we mostly did everything we could to help.
posted by Jakey at 11:27 AM on April 15, 2016 [17 favorites]

Revolutions. Yeah, no, that's not such a good idea. Okay, maybe it's the only way to affect a meaningful change. But you have to get from here to there first.

Revolution: Needs to do away with a "class." We may be able to define classes in America. So which class ought to go? Keep in mind that any "class" will resist extinction, so you'll have to actually define their power before you it away from them. Let's say that you define the "oligarchs" as the class that needs to go. How is that going to work?

Can you wipe them out with a few strokes on the keyboard, or do you have to use machine guns? Or archipelagos? Or Gitmos? Or maybe someone invents a pill that turns off greed, hubris, or whatever else it is that keeps us in the shallow end of the gene pool. I fall back on snark, but I am truly unable to see any light at the end of this particular tunnel.

Shuffling definitions is fun, sort of like being the nth monkey banging away at your typewriter: 50 pages into Henry V and your prose turns to wleim 06^ emtucn mxnitnb nwotu. wheown/?-0me band of beekeeping trumpsuckers.
posted by mule98J at 12:47 PM on April 15, 2016

"Heed not the rabble who scream 'Revolution!' they have not your interest at heart."

From Hamilton, of course, spoken by a lackey of King George.

I've been thinking about this phrase a lot because revolution feels like the right word in my gut but absolutely wrong when I weigh the potential cost. Like mule98J says, revolution against whom specifically and by what means exactly? I don't have a clear answer to that (maybe some others do) and that's terrifying to imagine played out on a national scene. And what happens to the most vulnerable during the interregnum? What does the counter-revolution do to those at the bottom? Chilling.

Then again, it's also chilling to imagine the world my children are going to inherit. There aren't many choices, and none of them are particularly appealing.
posted by Tevin at 1:13 PM on April 15, 2016 [2 favorites]

I think of neo liberalism as the parts of capitalism that are against the free market hiding under the aegis of the free market. I have a terrible time convincing pro-capitalists that there's a difference, and have assumed I was merely ineloquent or wrong. But the ideology so dominant that it's invisible works too.
posted by clew at 1:34 PM on April 15, 2016

Maybe something more along the lines of Canada's NDP which, having tired of losing on principle, prefers to lose by weakly and transparently caricaturing the positions of neoliberal parties.

I thought this phenomenon is a universal trend, of leftist, labor, and 'liberal' (America-only term) parties moving towards the economic center through neoliberalism? Stuff like SYRIZA capitulating to the EU? Seems like Sanders and Corbyn are such interesting novelties because they're throwbacks to an age when leftist parties were actually leftist, or at least had leftist aspirations.
posted by Apocryphon at 2:09 PM on April 15, 2016 [2 favorites]

Is this really something that comes up in debates over single-payer in the US?

Sure. Allegedly Vermont's attempted single-payer plan was neoliberal because it would have allowed the private health insurance companies to survive and compete with it. I mostly see "neoliberal" used pejoratively by radical philosophers and political theorists, where they really mean it as an insult against any leftist or progressive reforms that preserve capitalism or markets. Presumably that's where Monbiot picked it up.

For instance the philosopher Robin James claims that whenever there is an conceptual emphasis on competition and markets as metaphors for other activities (for instance when we think of dating as a market or politicians as competing for votes) then we are falling into neoliberalism. It's a way of thinking about the world that applies economic ideas too broadly. I don't personally find this expansive conception helpful, such that it applies to, according to James:

"human capital, big data (the generalization of financialization as both episteme and medium), post-identity politics, globalization, creative destruction, resilience, sustainability, privatization, biopolitics, relational aesthetics."

I understand the way in which James calls "sustainability" and "resilience" neoliberal, but it just seems overbroad.

I think there is a rigorously historical usage that is connected to deregulation and privatization of national businesses by Pinochet. But if you're in favor of growing the size of government and you oppose death squads I think probably the term shouldn't apply. Like the term "liberal" itself, it ends up being an insult used by the left against progressives who aren't ready to agree to full-blown communism.
posted by anotherpanacea at 2:18 PM on April 15, 2016 [1 favorite]

John Kenneth Gailbraith noted that we have capitalism for the middle class and socialism for the corporations and very wealthy

... and the military.
posted by palbo at 2:28 PM on April 15, 2016

Neoliberalism can sound too obscure / academic for many people.

The term Market Fundamentalism is often a little easier to communicate.
posted by Speculatist at 2:49 PM on April 15, 2016 [3 favorites]

I mostly see "neoliberal" used pejoratively by radical philosophers and political theorists, where they really mean it as an insult against any leftist or progressive reforms that preserve capitalism or markets.

It is used that way sometimes, but for my part, it applies mainly to people who prioritize market/competition based solutions, without any serious thought whether or not it even makes sense to think competition and markets can solve the problem. It seems to me we need a better/more nuanced understanding of what competition is and how it functions: it's basically a sorting algorithm that takes a certain number of competitors out of a pool of competitors, based on some arbitrary success criteria inputs, for as long as you let it run in a particular domain. It manifestly can not generate more competitors, because only capital can do that, and anybody can see that if they think it through carefully. It's a selection making tool. That's all competition is, in the abstract. It can lead to good or awful outcomes, depending on how it's used and whether it's used appropriately. Imagine a baseball team whose players actively compete and undercut each other the entire time the game is running. How many games would a team like that win against a team playing like a team? None, right? Yet it's not uncommon in some workplaces and other settings where it doesn't make sense for an internally competitive, every-person-for-themselves culture to take hold. That's a dumb side effect of the crowd that only wants to sound that one note as the appropriate solution to every problem, and that's what I associate with the term "neoliberal."
posted by saulgoodman at 2:51 PM on April 15, 2016 [5 favorites]

Imagine a baseball team whose players actively compete and undercut each other the entire time the game is running. How many games would a team like that win against a team playing like a team? None, right? Yet it's not uncommon in some workplaces and other settings where it doesn't make sense for an internally competitive, every-person-for-themselves culture to take hold. That's a dumb side effect of the crowd that only wants to sound that one note as the appropriate solution to every problem, and that's what I associate with the term "neoliberal."

Oliver Williamson earned a Nobel Prize for explaining why companies can't be organized as competitive markets, so I'm totally sympathetic to this argument. But most of the folks I know who talk about neoliberalism would be quick to call Williamson a neoliberal. Certainly he'd be a neoliberal on Monbiot's view, from the FPP!

When the dust settles on this generation of scholars, I fully expect neoliberalism only by a small group of people who are willing to be use it in the way James and other radical theorists describe it. I mean, "market gobbles life" fits quite well into the general zeitgeist of anxieties about the permeation of various systems into other spheres. Yet, I almost always find those "neoliberal economist discusses non-market X in terms of markets" pieces interesting.
posted by anotherpanacea at 3:08 PM on April 15, 2016 [2 favorites]

When Hayek called his book The Road to Serfdom, one might assume that the title was intended to be a warning. However, it's turned out to be a set of directions.
posted by Grangousier at 10:12 AM

Exactly! It's like "To Serve Man" from The Twilight Zone.
posted by InsertNiftyNameHere at 3:14 PM on April 15, 2016 [6 favorites]

Imagine a baseball team whose players actively compete and undercut each other the entire time the game is running. How many games would a team like that win against a team playing like a team? None, right?

Apparently you're unfamiliar with the Sith Softball Intramural League
posted by Ray Walston, Luck Dragon at 4:30 PM on April 15, 2016 [1 favorite]

As others have said, it's difficult to find a good terminology for the ideology he describes, because the people who follow it don't admit it's an ideology and don't accept any label.

"Libertarianism", in the modern political sense, was popularized by Murray Rothbard in his book "For a New Liberty: The Libertarian Manifesto". That advocates the complete abolition of the state, and many who self-identify with the label still believe in that. The neoliberals of the article don't go nearly that far: they still want what they call a "small" state. Moreover "small" to them means simply "low-tax". Murray Rothbard-style libertarians are opposed to things like drug laws, bathroom bills, and state surveillance. Neoliberals as described in the article don't mind a highly intrusive state as long as the taxes are low. Libertarianism is also theoretically hostile to corporations (large private companies where ownership is separate from control) while neoliberals love them. So I don't think "libertarianism" is a good description for the ideology the article describes.

It's a distinct ideology from Libertarianism, Ordoliberalism which believes the state must intervene for markets to work, and Social Democracy which combines a generally capitalist economy with state interventions for social justice. It should have a name.
posted by TheophileEscargot at 10:17 PM on April 15, 2016 [2 favorites]

Yeah, neoliberals are generally fine with the state as long as the state is serving the interests and prejudices of the rich.
posted by Pope Guilty at 10:12 AM on April 16, 2016 [4 favorites]

I think neoliberalism is just another word for capitalism. I haven't seen any definition where the two are meaningfully differentiated.

I've been thinking about this phrase a lot because revolution feels like the right word in my gut but absolutely wrong when I weigh the potential cost. Like mule98J says, revolution against whom specifically and by what means exactly?

Well, the class in power is the bourgeoisie, so presumably they would be the target. And obviously they're not going to give up their ruling position without a struggle. There is a large Marxist literature about this subject (for instance).
posted by Noisy Pink Bubbles at 10:28 AM on April 16, 2016

The funniest part of it all is that The Road to Serfdom explicitly calls for state provision of both a minimum income and a basket of insurances like health insurance.
posted by ROU_Xenophobe at 10:29 AM on April 16, 2016 [3 favorites]

I think neoliberalism is just another word for capitalism. I haven't seen any definition where the two are meaningfully differentiated.

Capitalism is a broad range of ideologies that encompasses groups from social democrats to libertarians. Neoliberals are just the currently dominant faction, like Keynesians were after WWII.
posted by Pope Guilty at 10:33 AM on April 16, 2016 [3 favorites]

Chris Dillow on Stumbling and Mumbling:

It might be that “neoliberalism” is not so much a coherent intellectual project as a series of opportunistic ad hoc uses of capitalist power.

... Most leftists, I reckon, would describe all the following as distinctively neoliberal policies: the smashing of trades unions; privatization; state subsidies and bail-outs of banks; crony capitalism and corporate welfare (what George calls “business takes the profits, the state keeps the risk”; the introduction of managerialism and academization into universities and schools; and the harsh policing of the unemployed.

What do they have in common? It’s certainly not free market ideology. Instead, it’s that all these policies enrich the already rich...

posted by TheophileEscargot at 2:01 PM on April 16, 2016

I hate the way selling off of Electricity Generators is called "price liberalisation", as if privatising Electricty Stations and networks is creating freedom from a wicked government that centrally managers electricity grids.
I hate the way the IMF "liberalises" countries by disbanding trade unions and producer marketing boards.
I agree Metafilter; liberalism is anything that benefits the banks and pension funds.
And shock horror! Free university education could lead to capital flight from your country.
Didn't you know that government is just a corporation as will ?
posted by Narrative_Historian at 2:31 AM on April 17, 2016 [1 favorite]

Theophile Escargot: "Libertarianism", in the modern political sense, was popularized by Murray Rothbard in his book "For a New Liberty: The Libertarian Manifesto". That advocates the complete abolition of the state, and many who self-identify with the label still believe in that. The neoliberals of the article don't go nearly that far: they still want what they call a "small" state. Moreover "small" to them means simply "low-tax".

The term I've seen is "minarchist" (i.e. advocating a minimal state, "the state governs best which governs least", "our goal is to shrink the government until we can drown it in a bathtub", etc.). But I think it's they're obviously related, and to lump the two variants together and call them variants of libertarianism ("anarcho-capitalist" and "minarchist").

Joseph Heath, Filthy Lucre (published in the US as Economics Without Illusions), describing the "Capitalism is Natural" fallacy:

... two flavors of libertarianism developed. The first claims that self-interest alone is enough to motivate individuals not only to assert their own rights, but to respect the rights of others. [He cites Locke.] No government whatsoever is required; a market econoy is perfectly capable of arising in the so-called state of nature. The second claims that a state is required in order to prevent individuals from interfering with one another's rights but that this constitutes the only legitimate role for government. Libertarians of this tendency endorse a minimal, or what Robert Nozick called a "nightwatchman," state -- one that has no mandate to take any positive action: it is merely there to ensure that the rights of individuals are respected.

He goes on to describe how the first variant has collapsed philosophically. You need a state to enforce property, exchange, and contract: individual enforcement won't work, because of collective action problems. Debunking the second variant takes a little more work: once you have a minimal state (collecting taxes, punishing violations of law, etc.) to solve certain collective action problems, it's hard to draw the line and say that the state shouldn't solve other collective action problems (e.g. providing public health insurance).
posted by russilwvong at 12:53 PM on April 18, 2016 [1 favorite]

Wait, Heath's best argument against minarchism is literally a slippery slope claim?

That seems kind of understated. I don't know that book, but I've always been impressed by Heath's work on authenticity marketing. Hayek's arguments for social insurance are more substantive than that!

My view is that social insurance institutions (including eventually a basic income guarantee) are necessary background conditions for markets to function effectively. Eventually I expect we will determine that only naked redistribution will allow growth to continue, which I mostly associate with Marx, the Italian autonomists, and the self-educated econ blogger Steve Randy Waldman.
posted by anotherpanacea at 4:36 PM on April 18, 2016

russilwvong: You have to remember too that Libertarianism has a load of other gibberingly insane bollocks unorthodox moral philosophy associated with it too, such as self-ownership and the Non Aggression Principle. Libertarians believe that the fundamental human right is property, and the only form of evil is to attack property. This works through the principle of self-ownership: libertarians consider you to own yourself, so if I punch you in the nose I am attacking your property. That's one of the reasons they're uncomfortable with modern corporations with their separation of ownership and control: ownership is a kind of sacred concept to them.

Calling neoliberals "Libertarians" is a bit like deciding to call all Catholics "Mormons" because they're conservative Christians: there are some distinct beliefs that belong to the latter group but not the former.
posted by TheophileEscargot at 9:57 PM on April 18, 2016 [5 favorites]

A commenter to this blog post refers to the dominant ideology as neo-feudalism, and I wonder whether that's not accurate: the neoliberal true believers - the Goves and IDSs and Chris Graylings treat the right-wing part of the general public as their useful idiots, but in turn, they are the useful idiots of the neo-feudalists (the very powerful, the elite of the financial elite), whose ambitions aren't so much ideological as imperial. So there are three groups - the general public (who are latching on to broad concepts of Dealing With Benefit Scroungers, or Stopping Immigration or Lowering Taxes or whatever), the True Believers (who are marshalling those forces in the service of their pure Hayekian or Thatcherite or whatever ideology) and the neofeudalists (who are exploiting the True Believers to assume total control).

Of course none of these positions is at all consistent with a state or economy that functions in any reliable way (the awesome lie that they've been able to sell quite impressively is that Social Democracy is idealistic and impractical and right-wing small statism is pragmatic and realistic, when in fact the opposite is true), so it will collapse around their (and our) ears.

I actually don't want the world to collapse around my ears, I have enough problems as it is, so it would be nice, if unrealistic, to think that they can be stopped.
posted by Grangousier at 2:59 AM on April 19, 2016 [5 favorites]

anotherpanacea: I've been reading a lot of Heath lately. I really liked The Efficient Society in particular, as an excellent explanation of why we have major institutions (markets, corporations, government, even social norms) -- the common thread is the benefits you get from overcoming collective action problems.

Heath's argument against minarchism in Filthy Lucre is indeed a slippery-slope argument.

It should be noted that the level of taxation required to institute even the most bare-bones system of property rights and commercial exchange is not negligible. Anyone who has ever bought a piece of land and has been through the rigmarole of title searches and so forth knows that meticulous public records are essential for determining who owns what. ... Stephen Holmes and Cass Sunstein estimate that in 1997 the United States federal government spent $203 million on property-records management. That was just to keep track of things. Protecting and enforcing those rights cost the federal government more than $6.5 billion -- and that does not include any of the costs associated with the federal justice system (more than $5 billion), much less "police protection and criminal corrections" in the nation as a whole ($73 billion in 1992).

We have a special term for these types of services when they are offered by government and paid for through taxation. They are called social programs. ... Here we can see the fundamental problem with the libertarian or conservative vision of a minimal state. It has no principled basis: it is simply a list of social programs that people with certain personal preferences and animosities happen to favor. Once the libertarian makes the crucial concession -- that it is legitimate for the state to impose taxes in order to provide goods and services that, because of collective action problems, would not otherwise be provided -- it's difficult to explain why there shouldn't be other social programs as well, to resolve other sorts of collective action problems.

Conservatives, we are told, support government spending on "law and order," national defense, maybe highways, and perhaps a few other things. But why just these programs? Why not public housing, public education, public health care, state pension plans, unemployment insurance, environmental legislation, and so on? The basic argument for all of these social programs is that state provision is necessary in order to resolve collective action problems. They are, in this respect, no different than the military or the criminal justice system. Of course, the details of these arguments are all controversial. The point is that the libertarian is now forced to consider arguments for each of these social programs on a case-by-case basis. Sweeping denunciations of government "interference" with the market or with individual liberty are no longer credible. The scope of state action and the appropriate level of taxation cannot be settled at the level of political ideology; they now depend upon the answer to empirical questions concerning the occurrence and severity of collective action problems and the effectiveness of government in resolving them.

He goes on to describe other forms of social insurance typically supported by libertarians: deposit insurance, prosecution of white-collar crime, bankruptcy protection, limited liability.

It is important to emphasize that bankruptcy law and limited liability -- both of which involve the discharge of debts -- categorically violate several fundamental conservative principles. They interfere with property rights, undermine contractual obligations, erode personal responsibility, and leave "society" to pay the bill for improvident or foolish conduct of individuals. So what do these policies have going for them? They help to stabilize the capitalist system, reducing volatility in output, and they serve as a major force promoting investment and economic growth. They also enjoy nearly unanimous support among the business class. Corporate bankruptcy protection has been a permanent since 1898, and no modern economy has ever succeeded without similar provisions. It is difficult to imagine how anything even as simple as a mutual fund could be organized without the principle of limited liability.

More generally, what these programs have in common is that they are all forms of social insurance that benefit people with money to lend. They all involve government-created and government-funded exceptions to the principle of "lender beware!" We might think of them as social programs for capitalists. Naturally, one seldom hears complaints from the business class about this sort of government "interference" in the market. What lenders and investors typically oppose is not social insurance, or even the principle of social insurance, but merely the specific types of social insurance that protect other people -- especially workers and consumers. (Or, speaking more precisely, forms of social insurance that benefit people in their capacity as workers and consumers, rather than in their capacity as investors.)

As a result, the commitment to "limited government" and "laissez-faire" capitalism turns out to be not so much a principled defense of individual liberty as an arbitrary privileging of the interests of those with money to invest (whom we may refer to, for convenience, as "the wealthy"). The right-wing call for "less government" therefore becomes a call to "keep those programs that benefit the wealthy -- scrap everything else." And this simply doesn't qualify as a political philosophy. When spoken in the mouths of the privileged, it's just a fancy way of saying, "More free stuff for me, less for you."

When it comes to "case-by-case" arguments, my favorite argument by Heath is his concise explanation of the massive efficiency gains you get from public health insurance and public pensions, through risk-pooling. (A minarchist who advocates dismantling Medicare and Social Security is basically saying that we should pass up on these massive gains, in the name of principle.) But that's a pragmatic argument rather than a philosophical argument.
posted by russilwvong at 8:01 AM on April 19, 2016 [3 favorites]

Hmmm. I don't think that kind of hand-wavey argument can work. $80 billion sounds like a lot (although I think it's likely closer to $200 billion if you include state and local spending in the US) but it's chump change. Roughly 40% of GDP is government spending. That's $7 trillion. What's more, very little of that money is re-distributive; roughly $1 trillion. (That link is from Heritage, but since they don't like redistribution if anything it's likely to be an overestimate.)

So when Heath says we are "forced to consider arguments for each of these social programs on a case-by-case basis" I think that sounds nice, but basically that's ALL the work, to get from $200 billion to $7 trillion. You wouldn't be immediately sold if someone said, "Look, you're buying a new cellphone for two hundred bucks, but here, this phone costs seven thousand, and it's got lots of features that justify the additional expense, why not buy it?" We spend $637 billion on the military alone!

The justification has to be systemic, I'd think. Even Hayek is willing to make the specific case for basic income and social insurance as particular things that need support, one which feeds well into Rawlsian arguments for that bleeding heart Rawlsekian fusion. Like I said, I think we need something like the Marx analysis of capital's inevitable accumulation requiring redistribution in order to continue its positive innovative and productive enhancements. Which of course was Piketty's analysis, too, now that I think of it.
posted by anotherpanacea at 8:40 AM on April 19, 2016

anotherpanacea: I don't think that kind of hand-wavey argument can work. ... The justification has to be systemic, I'd think.

Once the "taxation is theft" philosophical foundation is gone, I think libertarians are on weak ground. The justification for large parts of government spending is easy: public health insurance and public pensions due to the gains from risk-pooling, public education due to spillover effects. The need for national defense spending is conceded even by minarchists.

As Heath notes, even under Reagan and Thatcher, the size of government spending barely budged. One big reason is that social programs which improve efficiency (like public pensions) are difficult to cut.

One of the most striking features of the welfare state is its extraordinary growth over the course of the 20th century. Furthermore this growth pattern has largely confirmed what is known as “Wagner’s law of expanding state activity”, viz. that public-sector expenditure can be expected to increase as a percentage of GDP as a society becomes more affluent (Bird, 1971). Over the course of the 20th century, welfare state spending did not just grow along with everything else, but steadily increased its relative share of GDP. This tends to be taken for granted, but is actually hard to explain on either the communitarian or the egalitarian model.

One of the most striking features of this growth pattern, in particular, is that it was largely unaffected by the ideological complexion of the political party in power. With very few exceptions, the welfare state continued to expand – in some cases quite dramatically – under the custodianship of right-wing political parties that explicitly rejected both egalitarian and communitarian ideals. Conservative governments have often introduced changes in the tax system, in order to make income taxes less progressive, or else shift the burden of revenue-collection to more regressive taxes. But at the same time that the tax system was being made significantly less egalitarian (under, say, Ronald Reagan or Margaret Thatcher), state spending as a whole was still increasing, almost always at a pace that exceeded the rate of economic growth. If the core normative logic of the welfare state involved a commitment to promoting equality, or else protecting certain spheres of interaction from commodification, one would naturally expect to see a certain ebb and flow in the activities of the state, with expansion of state activity following the election of political parties who endorsed this moral vision, and contraction during periods following the election of parties who explicitly rejected it. And yet the actual pattern is not like this. If, however, one thinks of the major set of welfare-state programs as public goods, in the broad sense of the term, then it is easier to see why they are so notoriously difficult to cut. When a redistributive program is eliminated, those who had been winners in the transfer can be expected to resist, while those who were losers will tend to support the initiative. With a Pareto improvement, on the other hand, the outcome is win-win, and so there is no “natural” constituency there to press for its elimination, the way that there is with a win-lose outcome.

I think we need something like the Marx analysis of capital's inevitable accumulation requiring redistribution in order to continue its positive innovative and productive enhancements.

I'm very dubious.
posted by russilwvong at 10:58 AM on April 19, 2016

No doubt Pareto improvements are always defensible, especially if they're built into the basic structural institutions the way major social insurance programs are. The question is what to do about Kaldor-Hicks improvements, which is usually the way neoliberal reforms are presented.
posted by anotherpanacea at 1:48 PM on April 19, 2016

Analyze them case-by-case. In the case of annuities, there's something like a 3X gain in efficiency that you get from state provision, because of adverse selection: it would cost you about three times as much to buy the same benefits from a Canadian insurance company in the form of a life annuity, compared to the benefits that you get from the Canada Pension Plan.

Around the same time as Feldstein's proposal to abolish Social Security, Canada reformed the Canada Pension Plan. There's proposals on the table to expand the CPP. Replacing public pensions with private savings seems like exactly the wrong direction.

Matthew Yglesias:

Here's the essential shape of 401(k) as a backbone of the retirement system:

— Poor people get absolutely nothing.

— Wealthy people who would have had large savings anyway get a nice tax cut that offers no meaningful incentive effect.

— For people in the middle, the quantity of subsidy you receive is linked to the marginal tax rate you pay—in other words, it's inverse to need.

— A small minority of middle-class people manage to file the paperwork to save an adequate amount and then select a prudent low-fee, broadly diversified fund as their savings vehicle.

— Most middle-class savers end up either undersaving, overtrading, investing in excessively high-fee vehicles or some combination of the three.

— A small number of highly compensated folks now have lucrative careers offering bad investment products to a middle-class mass market based on their ability to swindle people.

Congratulations, America!

posted by russilwvong at 5:00 PM on April 19, 2016 [8 favorites]

"The angry reaction to my report revealed that by some combination of rationalization and the dominance of neoclassical microeconomics since the 1970s, liberal economists have virtually abandoned Keynesian economics, which supported the notion that governments can and must intervene in the economy to ensure the best results for society. These economists went back to pre-Keynesian thinking, where price fluctuations are supposed to equilibrate supply and demand at full employment with an optimal distribution of good and services. The very suggestion that government action can result in increases in growth rates or wages is now taken to be obviously wrong. Adopting the language of neoclassical micro welfare economics, everything is already as good as can be — all that government can do is to make it worse. Criticisms of the orthodox model and its policies are deemed worthy of scorn, to be dismissed tout court because they are obviously at variance not only with textbook economics, but with what we need to believe to rationalize failure."

posted by Pope Guilty at 3:12 AM on April 22, 2016 [3 favorites]

-Neoliberalism
-When Neoliberalism Was Young: A Lookback on Clintonism before Clinton
-Neoliberalism may have overreached in the U.S., but that doesn't mean it's always bad
-A Comment on Henry Farrel commenting on Brad DeLong commenting on Henry Farrel commenting on Doug Henwood
posted by kliuless at 10:50 AM on May 5, 2016 [2 favorites]