BY Doug Nicholls Neoliberalism is a set of economic policies that have become widespread during the last 30 years or so bringing misery to people and the environment as well as war and economic collapse, terrorism and a new form of gullible individuali …
BY Doug Nicholls
Neoliberalism is a set of economic policies that have become widespread during the last 30 years or so bringing misery to people and the environment as well as war and economic collapse, terrorism and a new form of gullible individualism.
Consumerism is so extensive that even electoral politics have become a matter of individual choice on the market. Yet what is economic is deeply political: it is impossible to split the two. Neoliberalism is a purely political project to maximise profits, and it is not in the best interests of workers. It is a phase of capitalism in which speculative finance capital dominates the productive, real economy and finance houses achieve, in a new way, a superiority over national governments.
Society and the economy are turned into a casino run by the superrich on the chips cashed in by the increasingly poor majority. Neoliberalism represents as profound a change to the economy and political culture as the Industrial Revolution did, though it represents a complete reversal of that earlier technical and social change which brought productive manufacturers to power.
A changed economy has changed the way people think and relate to each other. Neoliberalism creates a passive culture of selfhood within the illusion of immense democratic activity through the internet. At the same time the state becomes more authoritarian and punitive and concepts of a welfare society and social responsibility are attacked. Critical thinking is frowned upon more than ever, and anyone questioning austerity and inequality is pilloried.
“Neo” means new, it means, then, a new kind of liberalism. So what was the old kind? The liberal school of economics became famous in Europe when Adam Smith, a Scottish economist, published a book in 1776 called The Wealth of Nations (Smith 1776). He and others advocated the abolition of government intervention in economic matters. ‘No restrictions on manufacturing, no barriers to commerce, no tariffs’, he said; free trade was the best way for a nation’s economy to develop. Such ideas were “liberal” in the sense of no controls. The markets regulated themselves in the general social interest; this at least was the dream. This application of individualism encouraged “free” enterprise,” “free” competition which came to mean, free for the capitalists to make huge profits as they wished without restraint.
This form of “liberal” capitalism dominated until, in the post Second World War period, especially in Britain. Workers’ challenged it. Whole sections of the economy were nationalised and significant public services and welfare provisions were established. Wages formed a significant share of GDP. In Britain for example sound pension schemes were won which guaranteed workers some dignity in retirement. Pensions represented hope and confidence in the future along with student grants and free education. The emphasis on planning and investment took over from the random roll of the dice of the market. Utilities were under public control and manufacturing capital, that is the accumulated wealth of those capitalists earning profits from domestic industrial production, had the most significant political power.
Some countries, notably the Soviet Union and China took their whole economies out of the capitalist world market and introduced planning systems led by the state. Many nations liberated themselves from imperial domination and began to develop their own national economies
This all threatened the rate of profit that was being made globally and in individual nations. It also gave a political emphasis to developments based on socialist concepts of the public good, community, not for profit organisations and democratic accountability. Social solidarity was the goal of government intervention. Some commentators have called this the welfare economy. Relative to now, there was at that time a concept of common, social welfare as being a major function of government and the state.
These relatively progressive developments only inspired the corporate elite to revive economic liberalism. They had been pushed out, and they wanted to come back. This is why many commentators describe the neoliberal economy as the politics of the living dead, the zombies, running a demented casino. They had been marginalised and wanted to return to centre stage to marginalise workers in revenge. This is what makes it “neo” or new. They methodically planned their return using academic economists, think tanks and regular networks and secret meetings of like-minded people. Eventually they found General Pinochet, Prime Minister Thatcher and President Reagan to champion their cause along with the architects of the European Union.
So neoliberalism is more like an attempted resurrection, it represents a seizing back of powers in a generational tussle between capital and labour. Now, with the rapid globalisation of the capitalist economy, we see neo-liberalism seek to hold sway on a global scale and threatening any country, big or small, that stands in its way. Put simply, neoliberalism seeks to turn everything into a market place, and make profit from everything.
In the process, former democratic structures designed to hold a publicly accountable set of public services and economic investments together are replaced by a new authoritarianism guarding the rights of the market to rule supreme. Everything, from football clubs to social clubs, has to be targeted for making private profit. Instead of stable, trade unionised jobs, this new economy brings us flexible workforces, non-unionised workplaces, redundancies, outsourcing jobs, exporting manufacturing, freelance and temporary employees. This insecurity and mobility creates a new mentality and culture. The communal stabilities of localised manufacturing based economies and craft skills have been replaced.
A new contract between governments and the people has been silently drawn up. Government’s role becomes less and less to ensure public good and solve collective and national problems and more and more to open the doors to the global market and to address the personal issues of its ‘subjects’. The role of the state in economic and social policy diminishes, and there is a corresponding intensification and extension of its role as an agency of surveillance, obedience and control.
Traditional politics evacuates its previous role in the public and social sphere, it sells off the nation’s assets and seeks to privatise the rest. Politicians just manage the market. They also have to license war more frequently in a new wave of acts of aggression to secure oil supplies and ‘liberate’ countries from their own sense of self-reliance and national independence outside of the neoliberal market.
A range of regional and global entities from the European Union to NATO and the International Monetary Fund etc play an increasing role in securing the grip of finance capital and waging wars on sovereign nations whether the former Yugoslavia, or Iraq or Libya. Real wars are reflected in an increasingly violent culture of video games and violent depictions on our screens.
And, worse still, a culture of indifference to human suffering develops along with an acceptance that whole swathes of society can be considered disposable if they cannot be of use to the market. The attacks on young people from so many directions are a clear indication that neoliberalism ultimately wants to dispose of a productive future. In place of neoliberalism we need our own recommitment to neosocialism.
By Doug Nicholls writing in a personal capacity. He is the General Secretary of the General Confederation of Trade Unions (GFTU) – a supporter of USi.
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