Whatexactlyisneoliberalism_.pdf

7/23/2018 What exactly is neoliberalism?

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Author

Kean Birch
Associate Professor, York University,
Canada

Academic rigour, journalistic flair

What exactly is neoliberalism?
November 3, 2017 12.28am SAST

I struggle with neoliberalism – as a problematic economic system we might want to

change – and as an analytical term people increasingly use to describe that system.

I’ve been reading and writing about the concept for more than a decade. But the more I

read, the more I think that neoliberalism is losing its analytical edge.

As a result of its growing popularity in academia, media and popular discussions, it’s

crucial to understand neoliberalism as a concept. We need to know its origins and its

definition in to understand our current political and economic mess, including the

rise of nativism that played a part in Brexit and Donald Trump’s election a year ago.

Neoliberalism is regularly used in popular debate around the world to define the last 40 years. It’s

used to refer to an economic system in which the “free” market is extended to every part of our public

and personal worlds. The transformation of the state from a provider of public welfare to a promoter

of markets and competition helps to enable this shift.

Neoliberalism is generally associated with policies like cutting trade tariffs and barriers. Its influence

has liberalized the international movement of capital, and limited the power of trade unions. It’s

broken up state-owned enterprises, sold off public assets and generally opened up our lives to

dominance by market thinking.

As a term, neoliberalism is increasingly used across popular media, including The New York Times,

The Times (of London) and The Daily Mail. It’s also used within international institutions like the

World Economic Forum, the Organisation for Economic Co-operation and Development and the

International Monetary Fund.

Neoliberalism a Trump antidote?

Neoliberalism is criticized for giving markets too much power over our lives. Yet in light of the rise of

Donald Trump and other nativist, anti-trade populists, there is a growing chorus of people extolling

Paper chains hang on the White House fence in Washington in October 2010 during a demonstration against the IMF and World Bank neoliberal
economic policies during their annual meeting. Has the term neoliberalism run its course? (AP Photo/Jose Luis Magana)

November 3, 2017 12.28am SAST

What exactly is neoliberalism?

http://theconversation.com/profiles/kean-birch-310126

http://theconversation.com/africa

The difficulty of ‘neoliberalism’

http://www.independent.co.uk/news/business/news/corporate-research-development-innovation-brexit-donald-trump-europe-far-right-companies-visas-a8015651.html

How to think like a neoliberal: Can every decision and choice really be conceived as a market decision?

https://www.thetimes.co.uk/article/tories-may-have-joined-the-fray-too-late-save-neoliberalism-xmzncbs7j

http://www.dailymail.co.uk/news/article-4832486/Corbyn-ally-accuses-neoliberal-politicians.html

https://www.weforum.org/agenda/2017/07/this-is-what-the-future-of-economic-liberalism-looks-like-its-time-to-rethink-it/

A new narrative for a complex age

http://www.imf.org/external/pubs/ft/fandd/2016/06/ostry.htm

https://www.adamsmith.org/blog/coming-out-as-neoliberals

7/23/2018 What exactly is neoliberalism?

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the virtues of neoliberalism.

What’s most evident from this growing popular debate about neoliberalism – whether from left-

leaning critics or right-leaning advocates – is that there are many different views of neoliberalism; not

just what it means politically, but just as critically, what it means analytically.

This raises an important question: How do we use a term like “neoliberalism” when so many people

have such different understandings of what it means?

I wrestled with this question when writing my book, A Research Agenda for Neoliberalism, in which I

examine the intellectual history of neoliberalism. I do so in to examine the different conceptions

of the term and to expose the contradictions underlying our daily use of it.

The term “neoliberalism” has a fascinating intellectual history. It appears as long ago as 1884 in an

article by R.A. Armstrong for The Modern Review in which he defined liberals who promoted state

intervention in the economy as “neo-liberal” — almost the exact opposite meaning from its popular

and academic use today.

Another early appearance is in an 1898 article for The Economic Journal by Charles Gide in which he

used the term to refer to an Italian economist, Maffeo Pantaleoni, who argued that we need to

promote a “hedonistic world … in which free competition will reign absolutely” — somewhat closer to

our current conception.

Adopted by liberal thinkers

As the 20th century dawned and the world moved through one World War and onto the next, the

term was appropriated by a range of liberal thinkers who felt sidelined by the ascendance of state

planning and socialism.

The conventional narrative is that “neo-liberalism” was first proposed as a term to describe a rebooted

liberalism in the 1930s after the so-called Walter Lippman Colloquium held in Paris in 1938.

However, its history is not as clear cut as this narrative might imply. According to Arnaud Brennetot,

for example, the term was subsequently mainly used to refer to French and other liberals associated

with a publishing house called La Libraire de Medicis at least until the early 1950s. By then, the term

was increasingly used to refer to German Ordoliberalism, which was a “neoliberal” school based on

the idea that markets need a strong state in to protect competition — ideas that are a major

forerunner of the European Union’s framework conditions.

Famously, Milton Friedman even referred to himself as a “neoliberal” in a 1951 article for the

Norwegian magazine Farmand, although he subsequently dropped the term.

By the 1970s, Brennetot and others argued that neoliberalism was a term primarily associated with a

shifting emphasis in Latin America away from import-substitution policies towards open economies,

influenced by Chicago School thinkers like Friedman.

It was around this time that neoliberalism increasingly took on negative overtones, especially after the

violent overthrow of Salvador Allende’s government in Chile in 1973. As the 1980s dawned, along with

https://www.adamsmith.org/blog/coming-out-as-neoliberals

http://www.e-elgar.com/shop/a-research-agenda-for-neoliberalism

https://www.theguardian.com/books/2016/apr/15/neoliberalism-ideology-problem-george-monbiot

Maffeo Pantaleoni: At the Origin of the Italian School of Economics and Finance

http://www.newleftproject.org/index.php/site/article_comments/a_short_history_of_neoliberalism_and_how_we_can_fix_it

http://pure.au.dk/portal/en/activities/contextualising-the-walter-lippmann-colloquium(a97f6216-91a8-427b-8ada-3a579c873cda).html

https://cybergeo.revues.org/26324

https://www.cambridge.org/core/journals/american-political-science-review/article/the-political-thought-of-neo-liberalism/B4C3B238E3403C9E03670650BC8D3DCB

https://miltonfriedman.hoover.org/friedman_images/Collections/2016c21/Farmand_02_17_1951.pdf

https://www.globalresearch.ca/chile-september-11-1973-the-inauguration-of-neoliberalism-shock-treatment-and-the-instruments-of-economic-repression-the-juntas-deadly-economic-medicine/5545802

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the generally accepted birth of the modern neoliberal era, the term

“neoliberalism” became indelibly linked to the Chicago School of

Economics (as well as Law and Business).

Neoliberalism has several ‘schools’

When we use the term today, it’s generally with this Chicago inflection,

rather than its other previous and alternative histories and associations.

But it’s important to remember that there were and are at least seven

schools of neoliberalism. Some of the older schools, like the First

Chicago School (of Frank Knight, Henry Simons, Jacob Viner),

disappeared or were subsumed in later schools – in this case, the Second

Chicago School (of Milton Friedman, Aaron Director, George Stigler).

Other old schools, like the Italian or Bocconi School (of Maffeo

Pantaleoni, Luigi Einaudi) faded into academia before being resurrected

as the legitimization for current austerity policies. Other more marginal

schools, like the Virginia School (of James Buchanan, Gordon Tullock) –

itself influenced by the Italian school – have existed under the radar

until recent critiques by historians like Nancy MacLean.

As these various schools of neoliberal thought have evolved and mutated

over time, so too have our understandings of them and their influence on us. It’s therefore tricky to

identify neoliberalism with any one particular school of thought without missing out on a whole lot of

the story.

Three contradictions

That’s a major reason why I identify three core contradictions in our current understandings of

neoliberalism in my new book.

First, too little has been done analytically to address the contradiction between the supposed

extension of “free” markets under neoliberalism and the growth in market power and dominance of

corporate entities and monopolies like Google and Microsoft.

Second, there has been too much emphasis on the idea that our lives, identities and subjectivities

under neoliberalism are framed by “entrepreneurial” beliefs, attitudes and thinking.

In contrast, my view is that our lives, societies, and economies are dominated by diverse forms of

rentiership — for example home ownership, intellectual property monopolies and market control.

According to British academic Guy Standing, rentiership can be defined as the extraction of income

from the “ownership, possession or control of assets that are scarce or artificially made scarce.”

Finally, there has been little interest in trying to understand the important role of contract and

contract law – as opposed to “markets” – in the organization of neoliberal capitalism.

American writer and journalist Walter Lippmann on the cover
of Time Magazine in 1931. Lippmann’s writings were
influential on the neo-liberal movement in the first half of the
20th century.

https://www.routledge.com/The-Handbook-of-Neoliberalism/Springer-Birch-MacLeavy/p/book/9781138844001

https://global.oup.com/academic/product/austerity-9780199389445?cc=ca&lang=en&

https://www.penguinrandomhouse.com/books/533763/democracy-in-chains-by-nancy-maclean/9781101980965/

https://www.academia.edu/33175493/Technoscience_rent_Towards_a_theory_of_rentiership

https://www.bitebackpublishing.com/books/the-corruption-of-capitalism

https://images.theconversation.com/files/193098/original/file-20171102-26432-1972e6w.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip

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IMF Economics World Bank Neoliberalism globalism Free market

All these areas need addressing in to better understand our future, but neoliberalism has

perhaps run its course in providing us with the necessary analytical tools to do this work. It’s time to

find new ways to think about our world.



http://theconversation.com/topics/imf-446

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http://theconversation.com/topics/world-bank-2308

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http://theconversation.com/topics/globalism-27780

http://theconversation.com/topics/free-market-45422