Neoliberalism the ideology at the root of all our problems

JulieW

JulieW

Well-Known Member
Silver Stacker
Forget the rest. Democracy is no longer feasible in this neoliberal world and socialism and fascism are the flags that the disenfranchised run to, not understanding the flawed system that is staggering along looking for new answers. The next step is what we have to grapple with in this brave new world.

So pervasive has neoliberalism become that we seldom even recognise it as an ideology. We appear to accept the proposition that this utopian, millenarian faith describes a neutral force; a kind of biological law, like Darwin's theory of evolution. But the philosophy arose as a conscious attempt to reshape human life and shift the locus of power.

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.

We internalise and reproduce its creeds. The rich persuade themselves that they acquired their wealth through merit, ignoring the advantages such as education, inheritance and class that may have helped to secure it. The poor begin to blame themselves for their failures, even when they can do little to change their circumstances.

Never mind structural unemployment: if you don't have a job it's because you are unenterprising. Never mind the impossible costs of housing: if your credit card is maxed out, you're feckless and improvident. Never mind that your children no longer have a school playing field: if they get fat, it's your fault. In a world governed by competition, those who fall behind become defined and self-defined as losers.
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The entire article is worth the time:
https://www.theguardian.com/books/2...ism-ideology-problem-george-monbiot?CMP=fb_gu

Where neoliberal policies cannot be imposed domestically, they are imposed internationally, through trade treaties incorporating "investor-state dispute settlement": offshore tribunals in which corporations can press for the removal of social and environmental protections. When parliaments have voted to restrict sales of cigarettes, protect water supplies from mining companies, freeze energy bills or prevent pharmaceutical firms from ripping off the state, corporations have sued, often successfully. Democracy is reduced to theatre.

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.

Neoliberalism was not conceived as a self-serving racket, but it rapidly became one. Economic growth has been markedly slower in the neoliberal era (since 1980 in Britain and the US) than it was in the preceding decades; but not for the very rich. Inequality in the distribution of both income and wealth, after 60 years of decline, rose rapidly in this era, due to the smashing of trade unions, tax reductions, rising rents, privatisation and deregulation.

The privatisation or marketisation of public services such as energy, water, trains, health, education, roads and prisons has enabled corporations to set up tollbooths in front of essential assets and charge rent, either to citizens or to government, for their use. Rent is another term for unearned income.
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In summary:

The words used by neoliberalism often conceal more than they elucidate. "The market" sounds like a natural system that might bear upon us equally, like gravity or atmospheric pressure. But it is fraught with power relations. What "the market wants" tends to mean what corporations and their bosses want. "Investment", as Sayer notes, means two quite different things. One is the funding of productive and socially useful activities, the other is the purchase of existing assets to milk them for rent, interest, dividends and capital gains. Using the same word for different activities "camouflages the sources of wealth", leading us to confuse wealth extraction with wealth creation.

A century ago, the nouveau riche were disparaged by those who had inherited their money. Entrepreneurs sought social acceptance by passing themselves off as rentiers. Today, the relationship has been reversed: the rentiers and inheritors style themselves entrepreneurs. They claim to have earned their unearned income.
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Where does that label "neoliberalism" come from?
As far as I know, nobody, no group, no politician, no party, names itself as such.
Todays world is far away from liberal.
The origin of that "all our problems".
State intervention in about everything.
So any label with "liberal" in it, is just a lie.
That's my opinion 'bout it.
 
Pirocco said:
Where does that label "neoliberalism" come from?
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From the link above:
MH: It basically shows how the economic vocabulary has become Orwellian. The words that economists use have become the opposite of what they were really meant to be. "Free-market" now means the opposite of what Adam Smith meant by a free market. Right down the line, you have junk economics, which is basically neoliberalism, the Chicago school. It's a fictitious picture of how a hypothetical universe might work if the 1 percent were really job-creators. If they really ran the economy in order for a long-term growth, instead of in the short-term to make money for themselves and take the money and run. So it confuses a good economy with a bad economy. Reality economics with desert island economics, which is the kind of individualistic asocial, almost autistic economics that passes for economic education today.
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The article is some attempt to portray the existence of a world ruling class. I didn't read the whole article, it is just an exercise in conspiratorial journalism not backed by any solid argument. It's typical Marxist dribble. But I'll take to task what I did read. But firstly, a definition is necessary.

Definition of neoliberalism:

a modern politico-economic theory favouring free trade, privatization, minimal government intervention in business, reduced public expenditure on social services, etc
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http://www.dictionary.com/browse/neoliberalism

The author's claims about 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.
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I don't have a problem with any of that. We are consumers. I'm not sure what the author thinks we are, as he doesn't offer an alternative, but we are consumers.

We consume in order to meet our needs and desires, some are basic such as food and water, while others are higher order needs such as cultural, artistic or emotional wants and importantly it is from our consumption habits that social order emerges In other words, if we didn't need to consume then there wouldn't be any need for social phenomena to emerge. Now, in order for us to "consume" our way to satisfying our needs and desires through the buying and selling of goods, resources and skills, it would be foolish of us not to reward those who are able to meet those needs in the most efficient method possible. By rewarding efficiency and the best provision of our needs (merit), we reduce waste and enhance the outcomes for a greater number of people, than if we rewarded inefficiency or that which has little worth.

If there are better ways to meet the needs of as many humans as possible than rewarding efficiency and merit, well, the author doesn't offer any alternative except:

What the history of both Keynesianism and neoliberalism show is that it's not enough to oppose a broken system. A coherent alternative has to be proposed. For Labour, the Democrats and the wider left, the central task should be to develop an economic Apollo programme, a conscious attempt to design a new system, tailored to the demands of the 21st century.
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An economic Apollo program? :rolleyes: :P

Back to the original quote, that markets best meet the needs of consumers rather than central planning. Advocates of free market as opposed to central planning advocates hold this view because we recognise that firstly, markets arose spontaneously, they weren't planned into existence by any central authorities and secondly it is impossible for any select group of individuals to possess enough knowledge in order to take into account the millions of different variables present in any market when consumers go about satisfying their needs. To do so would require a gift from God.

The author then goes on to list some of the woes that we now face, attempting to throw the blame at the feet of the free-market, citing as evidence, government protected industries, politicians, special interest groups imposing their value on to others and conspiratorial nuts. Now I'm not sure how you make the logical leap from citing the nefarious acts of central planners, cron-capitalists and slf-interested politicians as evidence that the free market is a failure, but apparently the author manages too.

But then, it is The Guardian. And as we all know, it always gets things wrong all the time.

I'm not going to delve into the link from fiatphoney, by Micahel hudson, suffice to say it's just more nonsense.
 
mmm....shiney! said:
It's typical Marxist dribble.
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Yes.

It is Corruption and Cronyism which is the root of all our problems, and yes, they have pretty much become ideologies of their own inside the political and financial elite.

At face value I don't have a problem with socialism or government. But in the real world, in almost every instance, socialism leads to big government and big government leads to big corruption and cronyism. If these Marxist "intellectuals" can figure out a way to eliminate corruption and cronyism from big government then I might hear them out, but until then it's got to be a decentralization and reduction of central power if we want to see power and prosperity returned to the people.
 
I'm of the opinion that overpopulation and money are the root of practically all our problems.
 
On central planning, best to quote the Ten Fundamental Laws of Economics again I think:

4. Value is subjective

Valuation is subjective and varies with the an individual's situation. The same physical good has different values to different persons. Utility is subjective, individual, situational and marginal. There is no such thing as collective consumption. Even the temperature in the same room feels differently to different persons. The same football match has a different subjective value for each viewer as can be easily seen the moment when a team scores.
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Skyrocket said:
I'm of the opinion that overpopulation and money are the root of practically all our problems.
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Then you don't understand the function of money. Overpopulation is just a value laden term that means different things to different people.
 
mmm....shiney! said:
Overpopulation is just a value laden term that means different things to different people.
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Money is just a value laden construct that means different things to different people.
 
SpacePete said:
mmm....shiney! said:
Overpopulation is just a value laden term that means different things to different people.
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Money is just a value laden construct that means different things to different people.
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Money is just a means by which we can exchange the value of our labour. Easier to trade money than dead cows for electricity, particularly if you don't really want dead cows but marshmallows, but dead cows are what the electricity provider wants at the time. ;)

Nothing value laden about that.
 
Mostly what people mean when they refer to money as being the root of all evil is not that money is evil, but the manner in which some accumulate money. Which gets back to BuggedOut's corruption and cronyism.
 
Pirocco said:
Where does that label "neoliberalism" come from?
As far as I know, nobody, no group, no politician, no party, names itself as such.
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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.

With their help, he began to create what Daniel Stedman Jones describes in Masters of the Universe as "a kind of neoliberal international": a transatlantic network of academics, businessmen, journalists and activists. The movement's rich backers funded a series of thinktanks which would refine and promote the ideology. Among them were the American Enterprise Institute, the Heritage Foundation, the Cato Institute, the Institute of Economic Affairs, the Centre for Policy Studies and the Adam Smith Institute. They also financed academic positions and departments, particularly at the universities of Chicago and Virginia.

As it evolved, neoliberalism became more strident. Hayek's view that governments should regulate competition to prevent monopolies from forming gave way among American apostles such as Milton Friedman to the belief that monopoly power could be seen as a reward for efficiency.

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.
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Mises and Hayek were unequivocally not "neoliberals". They were simply classical liberals-nothing "neo-" about them.

Neither of them supported central banks, huge corporate bailouts or the regulatory state which seem to be what is implied when the term "neoliberal" is applied (generally as a pejorative).
 
JulieW said:
Hayek's view that governments should regulate competition to prevent monopolies from forming ...
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Almost positive that this is a blatantly false statement.
 
Hudson said:
How much does a product, a pharmaceutical, for instance, actually cost? If it costs $2 to make a pharmaceutical pill and they sell it for $200 ,that difference of price over value is "rent."
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Lets assume that when Hudson says it costs $2 to make one pill, then he is referring to the total costs of capital, land and labour etc. The author is claiming that the $198 can be solely attributed to profit that is protected by government legislation. This is what the classical writers termed "rent". You'd have to ask how in the first place does a pharmaceutical company get a government protected monopoly over a market? And the answer is simple, by paying bribes to politicians who accept them.

So who's at fault, the free-market? These "neo-liberals? Or are our governments to blame? Not for any regulatory omissions, but for enacting legislation designed to protect their friends?

If the Michael Hudson reference is an attempt to discredit free-marketeers, then all it's done is discredit the central planners.
 
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