Let's talk about neoliberalism some more.

Happy new year everyone! Okay, now that that's over, I think we ought to begin 2021 through renewed opposition to the school of thought, policy, and action that has dominated the scene at all levels for the past forty years. I am referring, of course, to neoliberalism.

The discussion re-announced itself with a revealed interview with one of those Big Men on Campus with Joe Biden's ear. I am referring, of course, to Larry Summers.

The only upshot of the Larry Summers interview is likely to be that maybe a few people will think that Joe Biden has bad people advising him, and the vast majority will either dislike Joe because he sucks or because they're Trumpies in their little faux rebellion or they will believe everything MSNBC et al. tell them about Joe Biden (and thus by extension they'll believe every word of Summers).

Here's the important lesson, the one that SHOULD be learned: Summers is a NEOLIBERAL. By this is meant that he is one of that group that believes that the proper role of government is to create and enforce markets and that ideally all functions of everyone's lives would be market functions.

The ultimate principle of neoliberalism, as pointed out in Chapter 2 of Kees van der Pijl's A Survey of Global Political Economy, is investor "freedom." This principle comes up on page 46 in the author's discussion of "microeconomics and rational choice theory." After having gone over the history of mainstream ("marginalist") economics as an "axiomatic" (which really means faith-based -- if you agree with its principles you might find it interesting) discipline, van der Pijl gets to neoliberalism. Here's what he says:

Importantly, the neoliberals no longer confine their prescriptions to the economy. They want economic rationality to be applied to all aspects of society; no organ of the social body may be allowed to function according to other principles than that of free choice by rational, self-interested individuals.

Ultimately, as van der Pijl notes in his discussion of Friedrich von Hayek (1899-1992), the standard-bearer of neoliberalism, neoliberalism is committed to investor freedom in all spheres of life. This is on page 48:

The core concept of neoliberalism is the notion of ‘competitively determined freedom’. This concept of freedom is defined from the principle of privately disposable property of the means of production, secured by political institutions ensuring ‘law and order’. Hayek later specified law and order as the foundations of private property as such, as freedom of contract and the coercive upholding of contracts (quoted in Walpen, 2004: 114-5).

Thus, if Larry Summers believes in this insane pile of twaddle, why would he want the government to send out $2000 checks? That wouldn't promote investor freedom.

(The further catch, of course, is that EVERYONE in DC, on Wall Street, and throughout the ruling elites of the world, believes in this insane pile of twaddle, and they've believed it for forty years now. So, in the same way in which Donald Trump was not an exceptional case responsible for the general insanity of last year's politics, Larry Summers is also not an exceptional case responsible for why you aren't getting $2,000 checks.)


The day after Christmas, the New York Times online ran a piece on the effects of climate change("The Darkest Timeline," by Jonah Engel Bromwich). It was basically about another paper, called "Deep Adaptation," which supposedly changed the course of a lot of people's lives. Bromwich says about the paper that:

The paper’s central thought is that we must accept that nothing can reverse humanity’s fate and we must adapt accordingly. And the paper’s bleak, vivid details — emphasizing that the end is truly nigh, and that it will be gruesome — clearly resonated.

“When I say starvation, destruction, migration, disease and war, I mean in your own life,” wrote the author, Jem Bendell. “With the power down, soon you wouldn’t have water coming out of your tap. You will depend on your neighbors for food and some warmth. You will become malnourished. You won’t know whether to stay or go. You will fear being violently killed before starving to death.”

But you don't really adapt to climate change doom. You commit suicide in advance of the event. And it's hard to tell why a scientific paper, and not, say, the story of Paradise, California, would motivate people to say, geez, there isn't much point in living in a doomed society, so let's plan in advance. Or here's an alternative path: when confronted with the doom of the human race and of you, personally, you choose to believe in a pile of insane twaddle, and you say: billions for the rich, $600 for a few of the rest. Isn't that what Congress is doing now? To be sure, this is a sort of side-adventure, meant to contextualize neoliberals as the sort of people who say "oh boy! Profit!" when confronted with disastrous reality.


At any rate, neoliberalism. There are a bunch of books about neoliberalism. Probably the best place to start is with Naomi Klein's The Shock Doctrine, published in 2007. Klein makes clear what the enormous human costs are of neoliberal policy. The neoliberal method, Klein describes, is simple:

That is how the shock doctrine works: the original disaster – the coup, the terrorist attack, the market meltdown, the war, the tsunami, the hurricane – puts the entire population into a state of collective shock. The falling bombs, the bursts of terror, the pounding winds serve to soften up whole societies much as the blaring music and blows in the torture cells soften up prisoners. Like the terrorized prisoner who gives up the names of comrades and renounces his faith, shocked societies often give up things they would otherwise fiercely protect. (17)

It's your basic imperialism. David Harvey calls it "accumulation by dispossession"; his book, A Brief History of Neoliberalism, offers a good summary. I love the understatement at the beginning of the Google Books synopsis (linked):

Neoliberalism - the doctrine that market exchange is an ethic in itself, capable of acting as a guide for all human action - has become dominant in both thought and practice throughout much of the world since 1970 or so. Its spread has depended upon a reconstitution of state powers such that privatization, finance, and market processes are emphasized. State interventions in the economy are minimized, while the obligations of the state to provide for the welfare of its citizens are diminished.

"... has become dominant in both thought and practice throughout much of the world..." Yeah. That's like saying that European countries conquered much of Africa between 1870 and 1914. Uh-huh. It's good to appear innocuous when writing for publication!

Also meaningful are the writings of the French team of Gerard Dumenil and Dominique Levy. They've written a lot on the topic; the place to start would be Capital Resurgent. I haven't read this book in awhile. If I recall correctly, Dumenil and Levy argue that neoliberalism was a conscious choice of the elites, and that they could have chosen otherwise. But they didn't, and so here we are.

Those with an appetite for biting prose might enjoy Philip Mirowski's Never Let a Serious Crisis Go To Waste. Mirowski wants to chastise everyone -- the neoliberals for their "logic" (beautifully dissected), everyone else for misrecognizing the neoliberals and for pronouncing neoliberalism to be "dead" when in fact it's more dominant than ever.

There's an interesting foreign-policy take on neoliberalism in Kees van der Pijl's Global Rivalries from the Cold War to Iraq. Ostensibly a history of foreign relations, van der Pijl found himself obliged to discuss the history of neoliberalism because the history of foreign relations in the period after 1980 IS the history of neoliberalism.

Richard Cockett's Thinking the Unthinkable is a good early history of neoliberalism, from before the first meeting of the Mont Pelerin Society to its global triumph with Reagan and Thatcher.


All that having been said, it's amazing to find so many people online who think that "neoliberalism" is some esoteric phenomenon, or neoliberals who don't think they're neoliberals, or people who think there's no such thing as neoliberalism. You bring up neoliberalism and they say things like "I don't like labels." If you were to call a tree "green," would the tree respond by saying "I don't like labels"? We choose names for things because otherwise we wouldn't be able to talk about them in any serious sense.

Let's be clear. Today, "liberalism" might be this warm, fuzzy belief that government ought to give ordinary people a thing or two in addition to its usual duties of "national defense" (under the neoliberal regime this means wars for corporate profit) and "economic policy" (another giveaway to the rich). That's what the term "liberalism" came to mean in the US in the period after World War II. There's a longer and deeper meaning for the term "liberalism," and in that meaning it means what Adam Smith advocated, laissez-faire capitalism. The "neo" in "neoliberalism," to complete the definition, defines a form of liberalism in which it is viewed, by the neoliberals, as the duty of government to simulate laissez-faire capitalism by setting up markets and requiring people to participate in them. That's what neoliberalism is; that explains its NAME.

The classic neoliberal policy was the original "marketplace" function of the Affordable Care Act. The ACA was created to keep the insurance companies from pricing their product out of the market; the ACA obliged people to purchase health insurance (which, significantly, they still wouldn't be able to use in many ways) by setting up a "mandate penalty" in which non-purchasers would have to pay more in income taxes.

War for profit is a neoliberal initiative. Since the average consumer cannot purchase a war, the neoliberal government will step in to insure that there remains a market for war. Typically the wars serve to create enemies, which then sustain the war. Ultimately, what you see with neoliberal war is phenomena such as what was reported in Syria in 2016, in which militias funded by the CIA fought those funded by the Pentagon. It's fine as long as it moves product.

There shouldn't be any confusion, then, about neoliberalism as a ruling-class ideology. It has a well-defined meaning and plenty of examples to back up the notion that neoliberalism is a specific notion with specific beliefs, specific believers, specific policies, and a specific history.

It's your turn.

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earthling1's picture

Puts a lot into perspective.
One could note that "Trickle Down Theory" got neoliberalism's foot in the door. And now it is fully inside emptying the fridge.

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After six years, still getting robo-calls from Marriot Hotels.
They're like herpes.

magiamma's picture

Where to start?

For neoliberals

the duty of government [is] to simulate laissez-faire capitalism by setting up markets and requiring people to participate in them.

And to “insure there is a market for war”

That’s what we have. It’s been refined and refined. It’s backwards This gives no room for the survival of Gaia. Moving product is exactly what we should not be doing.

My frustration is that I just don’t know what can be done at this point. And I feel many do not. At least you have painted a clear picture for me of the “enemy”. War and more war. (I also am wondering why they pulled the Nimitz out. Inquiring minds want to know.)

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Cassiodorus's picture

@magiamma Meanwhile over at Counterpunch:

Victor Jara’s Hands: An Anti-Fascist Memoir-festo and Brief Personal History of Neoliberalism

See if you can acquire some Victor Jara -- good listening. And keep up the struggle! How is Keith McHenry doing these days? (at least we know he's not a neoliberal.) Have you visited the encampment in San Lorenzo Park of recent?

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"Be a loyal plastic robot for a world that doesn't care." -- Frank Zappa

magiamma's picture

@Cassiodorus
Is thriving.

Not been to encampment but many I know are. Here are a couple of links.

https://www.santacruzsentinel.com/2020/12/30/activist-groups-earn-one-we...

https://www.santacruzsentinel.com/2020/12/28/santa-cruz-activists-halt-h...

It’s a shit show. Changes daily.

Edit to add. Great article on Victor Jara. And song!

No human cost was too high to pay to usher in neoliberalism, to eviscerate the gains that labor had made under Allende’s Popular Unity Coalition, and to maintain a steady flow of cheap copper, fruit and fish to the U.S. under the auspices of “trade liberalization.” The new constitution passed under Pinochet’s dictatorship rolled back the reforms instituted under Allende. It expanded the power of the presidency and enshrined private property and corporate profits over social needs; Pinochet rolled back taxes on corporations and the wealthy, and eliminated a host of government services. State-owned companies, public housing, education, health care, and pensions were all privatized, turned into profit centers for corporations and the wealthy. The constitution written under Pinochet limited reforms, and the gap today between rich and poor in Chile is one of the highest in Latin America.

Jara’s version of the song “Venceremos” or “We Will Overcome,” became the anthem of Allende’s Popular Unity Coalition, and also figured centrally in eyewitness accounts of Jara’s death.

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Cassiodorus's picture

@magiamma -- pretty much anyone who owns property in or near coastal California, from Santa Rosa all the way down to San Diego, and out eastward to Stockton or Redlands, is mostly concerned (in life) with maintaining the outrageous property values that constitute their wealth. Taking out mortgages of course makes the problem worse, as the outrageous property values must be recouped to pay off the mortgages. The homeless, in Santa Cruz or elsewhere in the state, are seen as constituting an infringement upon those property values.

All of this anti-homelessness, of course, can be seen as the byproduct of the neoliberal obsession with markets. As money flooded into California starting in the 1980s, high-value jobs with the defense industry in places like San Diego first, Silicon Valley money later, property values escalated, and to meet those escalating property values, new property buyers needed to go heavily into debt and were, as a consequence, heavily dependent upon the property values of whatever it was they bought. That's probably why you're seeing such nonsense from the Santa Cruz City Council, the PD, and other entities of that sort. They are defending people who don't care about humankind as long as their 3br 2ba is worth $1.1 mil. The market has made them neoliberals. I really don't know how anyone can live in that part of California (probably most of it at this point) without being a neoliberal.

After my Mom died, her place in southern California sold for $730,000. I received 1/3 of that inheritance, my sister another 1/3, and the banks (who held the reverse mortgage) 1/3. I used my portion to get out of state and buy a place in southern Oregon for $226,000. I had to get out.

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magiamma's picture

@Cassiodorus

In the Silicon Valley that has not been developed. Developers are salivating to sink their pearly little teeth in. Already happening. I moved here before the crazy inflation happened. Still happening. They just recalled two of the progressive caring councilors in the last election. We’re fucked. Prices are going up now as the Valley moves over. Originally from Oregon. Love the folks there. Yes, the homeless are byproducts of neoliberalism. Well put.

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RantingRooster's picture

I was writing a comment, but it exploded so large I'm gong to post later as a stand alone post and reference back to this one. But great post! Hammer, meet Nail!

Ah, Neoliberaism that wonderful smell of poverty and exploration, because well, TINA.

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C99, my refuge from an insane world. #ForceTheVote

magiamma's picture

@RantingRooster
Difficult to write a short comment. Had the same problem. Looking forward to yours.

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Cassiodorus's picture

@RantingRooster nmi

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"Be a loyal plastic robot for a world that doesn't care." -- Frank Zappa

The main problem here is that people are not rational. Otherwise Madison Avenue would not exist.

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I've seen lots of changes. What doesn't change is people. Same old hairless apes.

Cassiodorus's picture

@The Voice In the Wilderness by making sure the only decisions they will be allowed to make will be _market_ decisions.

See how that works?

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"Be a loyal plastic robot for a world that doesn't care." -- Frank Zappa

If you can read this post it's worth it for the graphs alone.
https://tspsmartinvestor.com/2020/12/31/smart-bird-millennials-are-screwed/

Don't know if it's one of the free ones or only for subscribers.

I had to zoom tremendously and it was fuzzy, but 1977 seems to be the real start of the divergence. 1984 just bent the curve steeper (besides being an ominous year).

Hard to beleive but we serfs were actually still getting more equality through the Nixon-Ford years.

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I've seen lots of changes. What doesn't change is people. Same old hairless apes.

travelerxxx's picture

@The Voice In the Wilderness

First, I got in to the article with no issues.

Second, you are quite right that it's worth checking out if only for the graphs. I'm thinking that you've linked to this organization before? It's familiar. Anyway, thanks for the link. It's good.

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@travelerxxx

The things he's posted about Fed interventions are shocking. Like the graph of the April crash with the exact time of the Fed intervention marked and the graph zooms upward from there.
The Fed has been buying foreign bonds! (EU) They have a mandate to stabilize the dollar, not the Euro! Next they will start to buy UK bonds to prop up the pound, based on some sort of domino theory, but really holdig the door for our fat cats to get out and leaving the rest of us to hold the bag. (My idea not his, necessarily.)

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I've seen lots of changes. What doesn't change is people. Same old hairless apes.

Biden's picks show how ID politics used both to cover up and control people.

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and for the illuminating comments.

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