At Crooked Timber, What, if anything, is neoliberalism?
The core of the neoliberal program is
(i) to remove the state altogether from ‘non-core’ functions such as the provision of infrastructure services
(ii) to minimise the state role in core functions (health, education, income security) through contracting out, voucher schemes and so on
(iii) to reject redistribution of income except insofar as it is implied by the provision of a basic ‘safety net’.
@John Quiggin The core of the neoliberal program is (i) (ii) (iii)
Hmmm. For a rather short (and perceptive) blog post, that would probably do, but I find the description a bit too simplistic in the way it describes the role of the state. It seems to me an important tenet of the neoliberal ideology is the arbiter (or auctioneer) role it gives the state and other political institutions with respect to markets. Markets are the locus of justice and efficiency, but political institutions have the essential task of organizing them and the competitions that takes place within them, supposedly at least. In practice, this translated in a central role of political power not only in privatizing and breaking state monopolies, but also in the creation, sometimes ex nihilo, of markets supervised by state or quasi-state agencies (shielded of electoral choices by regulatory or ideally constitutional provisions) whose role was to organize concurrence in domains classical liberal economic theory would consider natural monopolies or natural public properties (education, health service, energy distribution, infrastructure of transportation, telecommunication, postal and banking service etc.). In that sense, the economical management of the EU post-1992 by the European Commission is probably the actual political system closest to the pure ideology.
Another aspect that is but alluded to is the actual electoral basis of neoliberal political power, a topic discussed at length in the Brahmin left thesis of Piketty’s most recent book, though other people came there way earlier and though Atari democrats is from 1983.
As for the failure of neoliberalism, the crucial point in my mind is that both the ideological and actual social reality of neoliberalism (probably more or less the same thing) – that is to say the idea that competition in which the most efficient, educated, innovative come on top and in which the ensuing economic growth lifts all boats – dramatically lack a fundamental property: it cannot reproduce the conditions of its own social existence. The central problem is concrete and simple: those who came on top of the previous round of the competition essential to neoliberal philosophy have the means and opportunity to rig the next round. Add to that the fact that the original basic insights of classical liberal proved to be more empirically correct than their neoliberal update, in that natural public monopolies are indeed more efficiently managed by public monopolies, and you get a vicious circle in which the tax cuts, social welfare cuts and privatizations are paid by diminishing common goods, so that maintaining constant welfare (even for the educated and wealthy) requires more income (you may want to enroll your children in a private school, or to supplement your declining national health or pension plan with a private one etc.). Those who can do it consequently exert as much pressure as they can on the economical and political system so that their income increases, but this requires new tax cuts, social welfare cuts and privatizations.
Another much more elementary point is that neoliberalism, as a political philosophy, is characterized by its very relaxed attitude, to say the least, towards inequality. People born after 1995, whose entire life experience has been of increased and extreme inequalities, can hardly subscribe to such a view.