Comments on David Harvey’s “A Brief History of Neoliberalism”

By Lambert Strether of Corrente.

I like physical bookstores (as opposed to virtual bookstores like the one to your right) because real shelves are easy to browse. Serendipitously, then, I encountered David Harvey’s A Brief History of Neoliberalism, bought it, and read it. Harvey[1] is a Distinguished Professor of Anthropology at CUNY but it could well be that anthropologists (like David Graeber) are better equipped to interpret our political economy to it than either politicians or economists. Here are two reviews of the book: Thom Hartmann, and Monthly Review; it’s also mentioned in a bibliographic review of neoliberalism in Theory, Culture, and Society

What we might call “the question of the state” — its nature, our experience of it, and its legitimacy, whether in particular or in general — has been coming up on the zeitgeist leaderboard lately; see the lively discussion at Naked Capitalism yesterday. And it does seem clear that since what Harvey labels “the neo-liberal turn” in the mid-70s — marked, if not defined, by the Powell Memo, the formation of the Business Roundtable, the advent of Thatcher and Reagan, and after which real wages were flattened and most gains from productivity necessarily accrued to the 1% and the 0.01% — the relationship of the citizen (now we say “consumer”) to the state changed. When, for example, I entered the labor market in the mid-70s, I had expectations for state provisioning of services that I no longer have (some measure of dignity with Social Security and Medicare) and assumptions about the limits of state power that I no longer hold (the Fourth Amendment). I know that readers who entered the labor market at later dates may not share the expecations and assumptions of my youthful self, but will perhaps consider expanding their sense of what was once possible, and could be again. Harvey’s book, then, is useful in understanding the neo-liberal turn, and may be useful in shaping what is to come next.

My aim in this post is to spark conversation and test out talking points. So, I’m not going to summarize Harvey’s thesis; see the reviews above. Rather, I’m going to quote great slabs of material from the Brief History — I know, I know, “That’s not writing. It’s typing” — and intersperse them with not-entirely-random commentary.

Two posts at Naked Capitalism provide some background on neoliberalism: First, Nathan Tankus’s 2013 interview with Philip Mirowski, where Mirowski proposes that

[Neoliberals] are constructivists, redefining and building a strong state to institute and maintain the kinds of markets they think will not come about on their own[2]. For the [neoliberal thought] collective, the most propitious time to make such bold interventions is during a crisis, when they are mobilized to define ‘exceptions’[3] to previous rules.

Hence “shock doctrine,” and so forth. Second, my own “Neoliberalism Expressed As Simple Rules,” which is not a theoretical treatment, but rather provides simple ways for you to spot neoliberals “in the wild”: The quasi-theological “because markets” as the axiom on which every neoliberal policy proposal rests, and the imperative “go die” is your fate if you don’t have the wherewithal to function in the markets they set up. (As a corollary, neoliberals exempt themselves from their own rules, rather like Ayn Rand collecting Social Security.)

I’m going to look at what Harvey as to say in four topic areas, most of which have come up in the NC comment area at one time or another:

  • Neoliberalism Defined
  • Neoliberalism and Elite Power
  • The Neoliberal State
  • Neoliberalism vs. Neoconservativism

In all these topic areas, “the question of the state” is paramount.

1. Neoliberalism Defined

Here is Harvey’s definition of neoliberalism (page 2):

Neoliberalism is in the first instance a theory of political economic practices that proposes that human well-being can best be advanced by liberating individual entrepreneurial freedoms and skills within an institutional framework characterized by strong private property rights, free markets, and free trade. The role of the state is to create and preserve an institutional framework appropriate to such practices.

Because markets. If you’ll reread that paragraph, you’ll see that these views are so pervasive as to have been transformed into common sense; they are certainly shared by both legacy parties and the political class, and ideas that are not neoliberal (single payer, for example) are not permitted within the Overton Window that defines legitimate discourse; they cannot be expressed, and perhaps cannot even be thought. For example, the “tragedy of the commons” is a stable of neoliberal discourse, and is not merely untrue, but defines the only sane way to govern common pool resources like watersheds out of existence.

Here is Harvey’s description (pages 2 – 3) of “the neoliberal turn,” a phrase I obviously like:

There has everywhere been an emphatic turn towards neoliberalism in political-economic practices and thinking since the 1970s. The process of neoliberalization has, however, entailed much ‘creative destruction’, not only of prior institutional frameworks and powers (even challenging traditional forms of state sovereignty) but also of divisions of labour, social relations, welfare provisions, technological mixes, ways of life and thought, reproductive activities, attachments to the land and habits of the heart. In so far as neoliberalism values market exchange as ‘an ethic in itself, capable of acting as a guide to all human action, and substituting for all previously held ethical beliefs’, it emphasizes the significance of contractual relations in the marketplace. It holds that the social good will be maximized by maximizing the reach and frequency of market transactions, and it seeks to bring all human action into the domain of the market. This requires technologies of information creation and capacities to accumulate, store, transfer, analyse, and use massive databases to guide decisions in the global marketplace. Hence neoliberalism’s intense interest in and pursuit of information technologies (leading some to proclaim the emergence of a new kind of ‘information society’). These technologies have compressed the rising density of market transactions in both space and time.

This paragraph is so rich I hardly know where to begin. For a lunatically precise reductio ad absurdum of “contractual relations” and “habits of the heart,” see Andrew Ditmer’s “Journey into a Libertarian Future,” parts one, two, three, four, five, and six, with its oft-repeated catch-phrase “in a rights-respecting manner.” For “maximizing the reach and frequency of market transactions,” see many NC posts on the claims for “shopping” vs. the realities of the tax on time and (with ObamaCare) the deliberate obfuscation of market offerings by vendors. And on information technologies, see Greenwald, Snowden, et al.

Harvey also claims (pages 159 – 60) that “accumulation by dispossession” is a key feature of the neoliberal dispensation:

The main substantive achievement of neoliberalization, however, has been to redistribute, rather than to generate, wealth and income. I have elsewhere provided an account of the main mechanisms whereby this was achieved under the rubric of ‘accumulation by dispossession’. By this I mean the continuation and proliferation of accumulation practices which Marx had treated of as ‘primitive’ or ‘original’ during the rise of capitalism. These include the commodification and privatization of land and the forceful expulsion of peasant populations (compare the cases, described above, of Mexico and of China, where 70 million peasants are thought to have been displaced in recent times); conversion of various forms of property rights (common, collective, state, etc.) into exclusive private property rights (most spectacularly represented by China); suppression of rights to the commons; commodification of labour power and the suppression of alternative (indigenous) forms of production and consumption; colonial, neocolonial, and imperial processes of appropriation of assets (including natural resources); monetization of exchange and taxation, particularly of land; the slave trade (which continues particularly in the sex industry); and usury, the national debt and, most devastating of all, the use of the credit system as a radical means of accumulation by dispossession. The state, with its monopoly of violence and definitions of legality, plays a crucial role in both backing and promoting these processes. To this list of mechanisms we may now add a raft of techniques such as the extraction of rents from patents and intellectual property rights and the diminution or erasure of various forms of common property rights (such as state pensions, paid vacations, and access to education and health care) won through a generation or more of class struggle. The proposal to privatize all state pension rights (pioneered in Chile under the dictatorship) is, for example, one of the cherished objectives of the Republicans in the US.

Most of these techniques of primitive accumulation can be put under the heading of “enclosure”; to Harvey’s list we might add Monsanto’s attempt to privatize the germ plasm, the privatization of education both in charter schools and the general crapification of the university; and the conversion of law enforcement into a profit-making state enterprise, and not just in Ferguson.

However, I understand Harvey to be making the claim that these forms of extraction have come to outweigh profit in capitalism’s current, neoliberal implementation. I’m not so sure about that.

2. Neoliberalism and Elite Power

Here (page 15-16) Harvey describes the state of play in the mid-70s that drove the neo-liberal turn.

To have a stable share of an increasing pie is one thing. But when growth collapsed in the 1970s, when real interest rates went negative and paltry dividends and profits were the norm, then upper classes everywhere felt threatened. In the US the control of wealth (as opposed to income) by the top 1 per cent of the population had remained fairly stable throughout the twentieth century. But in the 1970s it plunged precipitously (Figure 1.2) as asset values (stocks, property, savings) collapsed. The upper classes had to move decisively if they were to protect themselves from political and economic annihilation. The coup in Chile and the military takeover in Argentina, promoted internally by the upper classes with US support, provided one kind of solution. The subsequent Chilean experiment with neoliberalism demonstrated that the benefits of revived capital accumulation were highly skewed under forced privatization. The country and its ruling elites, along with foreign investors, did extremely well in the early stages. Redistributive effects and increasing social inequality have in fact been such a persistent feature of neoliberalization as to be regarded as structural to the whole project. Gérard Duménil and Dominique Lévy, after careful reconstruction of the data, have concluded that neoliberalization was from the very beginning a project to achieve the restoration of class power. After the implementation of neoliberal policies in the late 1970s, the share of national income of the top 1 per cent of income earners in the US soared, to reach 15 per cent (very close to its pre-Second World War share) by the end of the century

Clearly, I think Harvey’s right to focus on the 70s; dear Lord, the leisure suit… Terrible music… It all must have meant something! However, when discussing elite angst, Harvey surely should include the 60s, as well as (perhaps) the idea that the reaction of a significant part of the elite to the New Deal was “Never again!” (Obama was able to actualize this elite desire when the time came in 2009.) I’d also like a better understanding of what “had to move decisively” meant in practice. How were the decisions taken? Clearly, however, I agree with Harvey that distributing wealth and power upward is a feature, not a bug, of the neoliberal project. (See the work of Outis Philalithopoulos on the nature of the thought collective that did the project work.) I also like very much the idea that even then, the elites were looking for new forms of power trans-nationally; elsewhere, Harvey mentions the New York bailouts of the 70s as a parallel case to Chile; I think the same thing happened after the failure of the Tahrir Square movement; dictators and wannabe dictators everywhere could tell themselves “not to worry.”

Reinforcing (page 19-20) the political character of the neoliberal project:

[We can] interpret neoliberalization either as a utopian project [q.v. Hayek, Friedman, the Chicago Boys, and other members of the neoliberal thought collective] to realize a theoretical design for the reorganization of international capitalism or as a political project to re-establish the conditions for capital accumulation and to restore the power of economic elites. In what follows I shall argue that the second of these objectives has in practice dominated. Neoliberalization has not been very effective in revitalizing global capital accumulation[4], but it has succeeded remarkably well in restoring, or in some instances (as in Russia and China) creating, the power of an economic elite. The theoretical utopianism of neoliberal argument has, I conclude, primarily worked as a system of justification and legitimation for whatever needed to be done to achieve this goal. The evidence suggests, moreover, that when neoliberal principles clash with the need to restore or sustain elite power, then the principles are either abandoned or become so twisted as to be unrecognizable. This in no way denies the power of ideas to act as a force for historical-geographical change. But it does point to a creative tension between the power of neoliberal ideas and the actual practices of neoliberalization that have transformed how global capitalism has been working over the last three decades.

As a caveat, Harvey’s discussion of class[5] leaves a good deal to be desired. In the passage above, for example, we have a process of “global capital accumulation” and we have “economic elites,” but the relationship between the two is not specified. However, I think Harvey’s idea that neoliberalism did not rejuvenate capitalism (as the New Deal surely did) but did increase the political power of the owners of capital (if that is what Harvey means by “economic elites) has a lot of be said for it. It speaks to the experience that most of us have of gradually crapified work and life experiences, at least where we encounter systems that have been prey to neoliberal infestations, while those who own and control those systems reap outsized rewards.

3. The Neoliberal State

Here (pages 79-81) Harvey presents a list of contradictions that, he claims, make the neoliberal state “a transitional” or “unstable” political form. (One might argue that a political class that is capable of producing a Clinton vs. Bush race in 2016 is about as stable as you can get, but then the ancien régime was stable, too; until it wasn’t. “If something cannot go on forever, it will stop,” and call me Pollyanna, but I can’t see continued dynastic conflicts causing anything other than disgust in the electorate, even with politics as degraded as it is.)

[The Neoliberal State] appears to be either a transitional or an unstable political form. At the heart of the problem lies a burgeoning disparity between the declared public aims of neoliberalism––the well-being of all––and its actual consequences––the restoration of class power. But beyond this there lies a whole series of more specific contradictions that need to be highlighted.

1. On the one hand the neoliberal state is expected to take a back seat and simply set the stage for market functions, but on the other it is supposed to be activist in creating a good business climate and to behave as a competitive entity in global politics. In its latter role it has to work as a collective corporation, and this poses the problem of how to ensure citizen loyalty. Nationalism is an obvious answer, but this is profoundly antagonistic to the neoliberal agenda. …

2. Authoritarianism in market enforcement sits uneasily with ideals of individual freedoms. The more neoliberalism veers towards the former, the harder it becomes to maintain its legitimacy with respect to the latter and the more it has to reveal its anti-democratic colours. This contradiction is paralleled by a growing lack of symmetry in the power relation between corporations and individuals such as you and me. …

3. While it may be crucial to preserve the integrity of the financial system, the irresponsible and self-aggrandizing individualism of operators within it produces speculative volatility, financial scandals, and chronic instability. ….

4. While the virtues of competition are placed up front, the reality is the increasing consolidation of oligopolistic, monopoly, and transnational power within a few centralized multinational corporations: the world of soft-drinks competition is reduced to Coca Cola versus Pepsi, the energy industry is reduced to five huge transnational corporations, and a few media magnates control most of the flow of news, much of which then becomes pure propaganda.

5. At the popular level, the drive towards market freedoms and the commodification of everything can all too easily run amok and produce social incoherence. … The reduction of ‘freedom’ to ‘freedom of enterprise’ unleashes all those ‘negative freedoms’ that Polanyi saw as inextricably tied in with the positive freedoms.

Every one of these contradictions speaks to the legitimacy of the neo-liberal state. I’d focus on “authoritarianism in market enforcement,” since that is exactly what ObamaCare does (and is what retirement will turn into, with a “marketplace” of its own, if we aren’t careful). That’s also what debtor’s prisons do, and its what law enforcement as a profit center does. A regime that forces its hand in your pocket for a fee every time you turn around, actively seeks to decrease what you have in your pocket in the first place, and then delivers increasingly crapified services, all with no means of redress within the electoral system, is a regime that, sooner or later, will face a legitimacy crisis.[6]

4. Neoliberalism vs. Neoconservativism

Here (page 81 – 82) Harvey explains how neoconservativism provides one way for the elite to resolve the contradictions listed above.

If the neoliberal state is inherently unstable, then what might replace it? In the US there are signs of a distinctively neoconservative answer to this question.

It is interesting to note how neoliberalization in authoritarian states such as China and Singapore seems to be converging with the increasing authoritarianism evident in neoliberal states such as the US and Britain. Consider, then, how the neoconservative answer to the inherent instability of the neoliberal state has evolved in the US.

[Neoconservatism] proposes distinctive answers to one of the central contradictions of neoliberalism. If ‘there is no such thing as society but only individuals’ as Thatcher initially put it, then the chaos of individual interests can easily end up prevailing over order. The anarchy of the market, of competition, and of unbridled individualism (individual hopes, desires, anxieties, and fears; choices of lifestyle and of sexual habits and orientation; modes of self-expression and behaviours towards others) generates a situation that becomes increasingly ungovernable. It may even lead to a breakdown of all bonds of solidarity and a condition verging on social anarchy and nihilism. In the face of this, some degree of coercion appears necessary to restore order. The neoconservatives therefore emphasize militarization as an antidote to the chaos of individual interests. For this reason, they are far more likely to highlight threats, real or imagined, both at home and abroad, to the integrity and stability of the nation. In the US this entails triggering what Hofstadter refers to as ‘the paranoid style of American politics’ in which the nation is depicted as besieged and threatened by enemies from within and without.

Well, yes. Neoconservativism providing a militarized solution to the problems neoliberalism created for itself. (It could be, however, that neoliberalism has introduced a contradiction there as well; Iraq and much of our latest imperial work was done with mercenaries (because markets); is it really possible for mercenaries to appeal to national sentiment?)


All I can say is that I hope this random walk though A Brief History of Neoliberalism inspires some conversation. Readers, does the “neoliberal” turn as a historical moment make sense to you? How would you date it? Is Harvey’s description of neoliberalism sufficiently nuanced and grounded to apply specifically to our time, while being general enough to suggest historical parallels? Are there any aspects of or turns of phrase in Harvey’s language that you find especially attractive? Are the militarized solutions of the neocons specific to either of the two parties, or accepted by both? Is “the question of the state” on the agenda? Should it be?


[1] Harvey published his book in 2005. Here (p 189) he warns of the coming great financial crash of 2007-2008: “Such a mix of indicators elsewhere would almost certainly have necessitated IMF intervention.”

[2] Hence ObamaCare. Because markets.

[3] Carl Schmitt, Political Theology: “Sovereign is he who decides on the exception.”

[4] Had it been, Silicon Valley wouldn’t be awash in so much cash that there’s no place to invest it that yields an adequate return (absent accounting control fraud, as in the housing crisis).

[5] Harvey writes (page 40):

But what exactly is meant here by ‘class’? This is always a somewhat shadowy (some would even say dubious) concept. Neoliberalization has, in any case, entailed its redefinition. This poses a problem. If neoliberalization has been a vehicle for the restoration of class power, then we should be able to identify the class forces behind it and those that have benefited from it. But this is difficult to do when ‘class’ is not a stable social configuration. In some cases ‘traditional’ strata have managed to hang on to a consistent power base (often organized through family and kinship). But in other instances neoliberalization has been accompanied by a reconfiguration of what constitutes an upper class. Margaret Thatcher, for example, attacked some of the entrenched forms of class power in Britain.

Hmm. I would say — without, I grant, proferring a definition of my own — that “dynamic” would be a better word than “shadowy,” and that it’s not reasonable to demand that class be a “stable social configuration.” Even the great division between those who sell their labor and those who bu it isn’t all that stable looked at in detail, when you consider the rise of the precariat, of System D, and so forth, all of which have happened in decades, not centuries. Dynamics like these are what drive the mysterious labor force participation rate, for example.

[6] To be fair, this could be exactly why the elites regarded the New Deal as illegimate.

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About Lambert Strether

Readers, I have had a correspondent characterize my views as realistic cynical. Let me briefly explain them. I believe in universal programs that provide concrete material benefits, especially to the working class. Medicare for All is the prime example, but tuition-free college and a Post Office Bank also fall under this heading. So do a Jobs Guarantee and a Debt Jubilee. Clearly, neither liberal Democrats nor conservative Republicans can deliver on such programs, because the two are different flavors of neoliberalism (“Because markets”). I don’t much care about the “ism” that delivers the benefits, although whichever one does have to put common humanity first, as opposed to markets. Could be a second FDR saving capitalism, democratic socialism leashing and collaring it, or communism razing it. I don’t much care, as long as the benefits are delivered. To me, the key issue — and this is why Medicare for All is always first with me — is the tens of thousands of excess “deaths from despair,” as described by the Case-Deaton study, and other recent studies. That enormous body count makes Medicare for All, at the very least, a moral and strategic imperative. And that level of suffering and organic damage makes the concerns of identity politics — even the worthy fight to help the refugees Bush, Obama, and Clinton’s wars created — bright shiny objects by comparison. Hence my frustration with the news flow — currently in my view the swirling intersection of two, separate Shock Doctrine campaigns, one by the Administration, and the other by out-of-power liberals and their allies in the State and in the press — a news flow that constantly forces me to focus on matters that I regard as of secondary importance to the excess deaths. What kind of political economy is it that halts or even reverses the increases in life expectancy that civilized societies have achieved? I am also very hopeful that the continuing destruction of both party establishments will open the space for voices supporting programs similar to those I have listed; let’s call such voices “the left.” Volatility creates opportunity, especially if the Democrat establishment, which puts markets first and opposes all such programs, isn’t allowed to get back into the saddle. Eyes on the prize! I love the tactical level, and secretly love even the horse race, since I’ve been blogging about it daily for fourteen years, but everything I write has this perspective at the back of it.


  1. Tony Wikrent

    I fear that identifying the “neo-liberal turning point” as the 1970s will obfuscate the historical reality that the neo-liberal thought collective – as Philip Mirowski calls it in his history of the Mont Pelerin Society – began some three decades earlier, in the 1940s. My one major critique of Mirowski is that he pulls his punches and refuses to go all in exploring the details of some of the big funders of Hayek, von Mises, and Mont Pelerin. But there are still plenty of details in Mirowski’s book to show that a bunch of old European oligarchs were involved.

    Why is this important?

    Culturally, Hayek, von Mises, and the Mont Pelerinites are NOT republicans, with a small “r.” I like to explain the issue by referencing some history. The classical republican ideals that inspired the creation of the American republic warned that concentrations of economic power were as dangerous as concentrations of political power; and indeed economic power and political power go hand in hand. This is also, I believe, the idea of classical liberalism. But what we have now is neo-liberalism, which argues that only concentrations of political power are a problem, and we should not worry about concentrations of economic power because the forces of the market will correct any abuses of economic power. “Keep the gubmint’s hands off my international conglomerate.”

    Liberalism was a revolt on behalf of a rising middle class against the power and privileges of European ruling oligarchs and monarchs, who used their connections and influence at royal courts to gain economic monopolies and other privileges. (This is generally known as the system of mercantilism.) The intent of classical liberalism was to sweep away the power of these oligarchical and monarchical states to make room for greater economic freedoms and property rights for the rising middle class.

    The culmination of liberalism was the creation of the American republic. However, it is crucial to note that under the Constitution of the new American republic, economic freedoms and property rights were subject to the Constitutional mandate to promote the general welfare. And in advanced industrial economies, the way a sovereign nation-state promotes and protects the general welfare is by imposing environmental, workplace, and consumer regulations on economic activity. There should also be strict limits on usury, speculation, and economic rent-seeking, which all drain financial capital away from the industrial economy and industrial enterprises. Credit default swaps and collateralized mortgage obligations are NOT the result of the “innovating role of an entrepreneurial elite,” but the spore of rich pricks who engage in usury and speculation and have never actually created real wealth in their entire lives.

    Neo-liberalism is a revolt funded in large part by “old money” from Europe who have hit on the method of corrupting the republican philosophy of political economy of the American republic, after two centuries of failing to destroy the experiment in self-government by outright military invasion, political subterfuge. economic warfare, co-opting the greediest Americans in the slave and opium trades, assisting as openly as they dared the slave owning traitors in an attempt to secede, and “the Special Relationship.” These European oligarchs have a willing fifth column in the USA: the newly arisen class of corporatist oligarchs and plutocrats enraged that the promotion of the general welfare by modern sovereign nation-states involves laws and regulations which “stifle” their “business opportunities” and “economic creativity.”

    Is it any accident that the USA bastion of neo-liberal economic ideas was a university in Chicago established almost entirely with funding from John D. Rockefeller?

      1. jonboinAR

        He’s saying it promotes an ignoring of deeper roots. I’d have to look into it further, which, considering the discipline I usually apply, I probably won’t do.

    1. Jeremy Grimm

      I also agree with Mirowski’s analysis arguing that the formation of the Mont Pelerin Society was the origin and crucial turning point leading to the ascent of Neo-Liberal thought. The much more evident transition of the 1970’s that Lambert points to represents the culmination of decades of prior effort and organization. However, it seems pointless to argue circles around seed and flower. It might be argued that Obama is the flower. It matters little compared to tracing the growth of the seed and analyzing such flowers as the plant has and perhaps more importantly will produce.

      Where did you read about old European oligarchs as the source of money for the Mont Pelerin Society? I recall nothing from Mirowski’s book which made even a suggestion of old European funding though certainly Hayek was European — part of the so-called Austrian School. But Karl Marx was European, and unless you pull England further from the continent than the separation of the Channel, Adam Smith was European.

      Besides — why does it matter if old European funding was behind the Mont Perlerin Society? It didn’t take long for the Society to show a very American face. Though Hayek was its philosophical parent, I thought Milton Friedman and the Chicago School of Economics — 1970’s — had a larger part in creating a successful ideological and practical framework for promoting Neo-Liberalism. Mirowski also describes the importance of the many think tanks created to generate confusing patterns of Neo-Liberal thinking and quasi-Neo-Liberal thinking that built a complex multi-layered structure of agnotology. The many Neo-Liberal think tanks have a very American flavor and smell to me. Your last paragraph strangely undercuts the arguments in the preceding paragraph unless you associate John D. Rockefeller with old money from Europe.

      You seem to be alleging Neo-Liberalism is a move by old European monied interests to reclaim the American republic from the hands of the people. If so, I find that notion incredible. The American Revolution was a case of one oligarchy wresting control from another. The men who wrote the Constitution were very wealthy and very powerful. The events leading up to and resulting in Shay’s Rebellion, as well as the way the rebellion was handled make very clear where the Founding Fathers stood. That detracts from their words and ideology as little as the sins of the Church detract from some teaching of the Gospels — and no I am NOT a Christian — but I do believe in Christian values of helping others.

        1. Vatch

          It was David Rockefeller who was behind the formation of the Trilateral Commission, not one of the John D. Rockefellers. Same family, of course.

      1. John Mc

        In Mirowski’s second offering (2014), Never Let a Serious Crisis Go To Waste, he traces the origins of neoliberalism back to Walter Lippman and his Colloque. Lippman and his friends (Bernays) believed that Liberalism had failed, but the New Deal and interventionist policies had hard evidence of working, so they waited until 1947 and with the help of Austrian economists built an organization, lobbied powerful interests for decades using academia, thinktanks, and corporate networks to facilitate local and long term goals — TINA…. So, the MPS was the formalization of the belief in western politics, economics and social propaganda, but the roots go back to the failure to unseat FDR and to regain power after the financial meltdown in 1929 and beyond.

        1. Jeff W

          This rather interesting article, “Neoliberalism: The Genesis of a Political Swearword,” [PDF] traces the origins of neoliberalism back to 1932 and Alexander Rüstow, who also coined the term, which was adopted by the participants at the 1938 Colloque Walter Lippmann.

          For the originator of neoliberalism, Rüstow apparently had some rather unexpected ideas. According to the article:

          The core of neoliberalism comes directly from Rüstow’s rejection of power. To him market power was as bad as political power and needed to be curtailed by a ‘Marktpolizei’ (market police)…

          To Rüstow, such market police measures went beyond a simple anti-trust Act. On the contrary, he assigned the state a far greater role in shaping market structures. For example, any kind of advertising in newspapers, radio or cinema should be banned. Not only, as he wrote, because they were vulgar, unproductive, and playing to the masses, but also because these marketing tools favoured the big advertisers at the expense of smaller businesses. He also argued for corporate taxation to be progressively linked to business size. In this way, he wanted to make large companies unviable and reduce them to smaller (or what he presumed to be optimum) sizes. Furthermore, Rüstow suggested forcing large companies holding patents to license them to their smaller competitors.

          All of this does not quite sound much like a program that we would call neoliberal today, but Rüstow had even more astonishing ideas for a neoliberal. All utilities, all rail companies, all companies with an alleged natural or technical monopoly should be nationalised. The armaments industry should also be nationalised, but for different reasons.

          [footnote numbers omitted]

          The article also recounts the “insurmountable differences” that became “unbearable” between the “old liberals” (i.e., Ludwig von Mises and Friedrich Hayek), whom Rüstow referred to, perhaps disparagingly, as “paleo-liberals” and the neoliberals (i.e., Rüstow and his buddy Wilhelm Röpke). (The author is himself a member of the Mount Pelerin Society but it didn’t seem to me that his account is inherently suspect.)

          1. hermes

            If I remember correctly from Dardot and Laval, Rüstow ended up as a founder ordoliberalism, the German/Continental European variant of neoliberalism that has a slightly more social bent than the Anglo-American neoliberalism, though they share a common philosophical foundation.

            Whereas for Mises and Hayek private, contractual competition between individuals in the market is was the epitome of their idea of freedom, Rüstow saw the sharper edges inherent in their market system and wanted government to mitigate issues with the less advantaged, which was anathema to “freedom” as envisaged by Mises and Hayek.

        2. hermes

          Pierre Dardot and Christian Laval come to the same conclusion in The New Way Of The World: On Neoliberal Society, that neoliberalism can be traced Lippmann and his quest to resuscitate classical Liberalism. Mises and Hayek (both Austrian economists who migrated to the US) picked up the torch and founded Mount Pelerin Society.

      2. Tony Wikrent

        Before I read Mirowski book The Road From Mont Pelerin (well, I read most of it, not all of it, since I had obtained it on interlibrary loan and couldn’t keep it long enough), I had assembled An Open Source Intelligence Profile of Ludwig von Mises in August 2010. Now, there are a lot of wild and wooly tubez posts to wade through, but it was clear to me that von Mises was imbued through and through with the oligarchic ideas of old Europe. I think it was in one of Philip Pilkington’s early 2013 posts on neo-liberalism here on NK that drew a picture of von Mises and von Hayek coming of age in the twilight of the Austro-Hungarian empire, in an intellectually oppressive of pessimism and fear of the future. An entire ruling elite was near the end of its existence, totally preoccupied with somehow ensuring its own survival against the tide of history, and with no thought for building a better future for the society it ruled.

        Compared to this, USA history is an alien universe, full of great dreams and grand designs.

        So, at the very least, Mirowski could have started by delving into von Mises’ place in the Austro-Hungarian empire. Mises was, after all, one of the founder of the MPS. For starters, look at von Mises serving as secretary of the Vienna Chamber of Commerce, which made him one of the closest economic advisers of Otto von Hapsburg, the eldest son of Charles I, the last Emperor of Austria and last King of Hungary. The Hapsburgs had ruled this crucial area of Central Europe for over 800 years. Otto was Crown Prince from 1916 to 1918 and since his father’s death in 1922, has been the Habsburg pretender to the thrones of Austria-Hungary. including the Kingdoms of Bohemia and Croatia. This fantasy has never really ended: in August 2004, Otto von Hapsburg helped establish in Austria the Black-Yellow Alliance, an openly monarchist movement, seeking to restore the “Dual Monarchy” of the Austro-Hungarian Empire, and re-unite Austria, Hungary, Croatia, the Czech Republic, Slovenia, and Slovakia under a hereditary monarchy.

        Mirowski simply does not dig into this.

        And then there is Hayek, who was also born in Vienna, and whose “paternal line had been raised to the ranks of the Austrian nobility for its services to the state, a generation before his maternal forebears were also raised to the lower noble rank” according to Wikipedia. What would be revealed if that particular thread were pulled?

        In fact, the very existence of the “von” in their names should have raised suspicions: it is a nobiliary particle, used “to signal the nobility of a family.”

        When I finally read Mirowski’s book, I was thunderstruck that he mentioned another name and utterly failed to investigate it. I did not know previous to reading the book that Max Thurn had served as served as the general secretary of the MPS from 1976 to 1988. Who is he? This is Thurn, of the Thurn und Taxis family, one of the most secretive and most powerful oligarchical families of Europe. Beginning some time in the 1500s, Thurn und Taxis provided postal services to the monarchs and nobility of all Europe. They used that position to spy on their clients, literally opening their mail. You can only imagine what they did with that information.

        Again, I repeat, Mirowski simply does not go there. Which reminds me a book someone pointed me to a few days ago: The Invention of Capitalism: Classical Political Economy and the Secret History of Primitive Accumulation, The Invention of Capitalism: Classical Political Economy and the Secret History of Primitive Accumulation, by Michael Perelman. I have not read it, but the blurb on Amazon is very, very interesting:

        To show how Adam Smith and the other classical economists appear to have deliberately obscured the nature of the control of labor and how policies attacking the economic independence of the rural peasantry were essentially conceived to foster primitive accumulation, Perelman examines diaries, letters, and the more practical writings of the classical economists. He argues that these private and practical writings reveal the real intentions and goals of classical political economy—to separate a rural peasantry from their access to land.

        What will be found when scholars finally get hold of the private correspondence of von hayek, von Mises, Milton Friedman, Lionel Robbins, and other Mont Pelerin operatives? I have my suspicions….

        Now, all this discussion of old European oligarchs is a great introduction to turning our attention to your assertion “The American Revolution was a case of one oligarchy wresting control from another. The men who wrote the Constitution were very wealthy and very powerful.” This is very popular mythology on the left, but I do not believe it is true to the historical record.

        First, if such were the case, why was British common law of primogeniture and entails so quickly and so definitively abandoned? Primogeniture and entails were absolutely essential to the perpetuation of noble family lines in England. Jeebus, we still have Dukes and Earls from the Grosvenor, Cavendish, Cadogan, and Percy families as some of the richest and most powerful in Britain. In the Netherlands, the Orange-Nassau royal family traces back to the early 1500s and today is the largest shareholder in Royal Dutch Shell, with a fortune of some 10 billion Euro.

        Secondly, what do you think of the whole corpus of work by such scholars as Bernard Bailyn, Gordon Wood, J. G. A. Pocock and Joseph Ellis? Do you just dismiss it as total bullshit? Were there, in fact, no Ideological Origins of the American Revolution?

        Just last night I posted a critique of this whole school of thought, using Charles Beard as a foil.

        I will also note here that Beard’s analysis of Alexander Hamilton is completely at odds with the way Hamilton is portrayed by people who like to quote Beard. These people paint a picture of Hamilton as a secret monarchist, desiring a strong, authoritarian central government able to suppress the democratic aspirations of common people and impose government policies and programs that favor the rich. Here is Beard’s own conclusion regarding Hamilton, from An Economic Interpretation of the Constitution:

        …an extensive augmentation of his personal fortune was no consideration with him. The fact that he died a poor man is conclusive evidence of this fact. That he was swayed throughout the period of the formation of the Constitution by large policies of government — not by any of the personal interests so often ascribed to him — must therefore be admitted. Nevertheless, it is apparent from the additional evidence given here that it was no mere abstract political science which dominated his principles of government. 

        Just to make the point about Beard’s conclusion crystal clear, Harvard professor Thomas K. McCraw writes in his 2012 book, The Founders and Finance: How Hamilton, Gallatin, and Other Immigrants Forged a New Economy, that what drove Hamilton above all else was his concern for

        …the good of the nation as a whole, not of any particular state or section. His thought centered on national economic aggregates—in agriculture, industrial production, and finance. In addition, he understood better than any other founder—indeed, better than any other American of his generation who left enough records to judge—how everything in the national economy was related to everything else. A first-class student of both economics and administration, he saw that in the construction of grand strategy, every move must be coordinated so as to make the whole of public policy greater than the sum of its parts….

        Hamilton attached great importance to the innovating role of an entrepreneurial elite… Hamilton believed that real economic breakthroughs required the leadership of visionaries like himself, whether in the public or private sector. He did not, as his enemies charged, favor the rich so much as he respected talented entrepreneurs and managers….

        The fact is, the American Revolution and the creation of the American republic actually were a fundamental turning point in world history. The problem of the continued existence of European oligarchs shows that the historical conflict between republican ideals and oligarchical power and privilege continues. What should be our goal, in studying American history, is to determine where those republican ideals failed, and why, in the non-ending combat with oligarchical power and privilege. Accepting the argument that the American republic was not really a republic at all, hopelessly cripples our ability to engage in that combat.

        1. Lambert Strether Post author

          Methodologically, Michael Perelman sounds like he’s in E.P. Thompson territory. I love that stuff.

          Adding, surely there are different varieties of oligarchy? Just because the Americans got rid of primogeniture didn’t mean they got rid of oligarchy as such. Consider factoring slavery into your discussion, for example.

    2. Jack

      ‘the newly arisen class of corporatist oligarchs and plutocrats enraged that the promotion of the general welfare by modern sovereign nation-states involves laws and regulations which “stifle” their “business opportunities” and “economic creativity.”’

      This is a very basic and probably naive question but: why? Seriously, why? Why are the already insanely rich so obsessed with getting richer? Taking steps to ensure you stay rich, okay, I get that. But once you’ve reached the point where you can afford mansions on multiple continents and not one but an entire wall of $100,000 Bang & Olufsen super TVs, why do you feel the need to contrive new ways to get more money? There’s nothing left you can buy, the only things out of your reach are things that literally don’t exist.

      1. John Mc

        At the risk of being too active on this subject, I will try to take a speculative bite at this very interesting question. For me, I remember what management at ML told me when I started, create an activity pattern and productivity will come —- or in their vernacular “act as if you are king”.

        I think this “act as if” belief sheds light on your question of how much is enough, and why do so many neoliberal agents keep pushing towards the next bigger better deal, thing or accomplishment. The activity pattern required to make this kind of money becomes a part of the persons neurochemical reward cycle, self-image, and appearance in the world. The combination of swallowing the zig ziglar style of thinking about the world (as someone/something to sell), the competitive aspect of making money and viewing the rewards of wealth through a highly individualized lens of I-am-a-success makes for a potent elixir hard to put down, once consumed.

        I am sure, how much is enough is not even a question some of the elites ask themselves. Whether it is GE, the Vatican or Manchester United, more is more in almost all cases. There is little opprobrium for excess accumulation in our society, at least not in their interactional circles.

        I am sure there are pieces to this complexity, but this is one that stands out to me.

        1. Jack

          So it’s not a rational thought process of “I need more money to do X”, it’s a compulsion. And also a dick-waving contest with other rich people.

      2. casino implosion

        I always assumed the money was just tokens in a big game. Has nothing to do with buying anything, just defeating the other billionaires is what matters.

        1. digi_owl

          In the words of old Veblen, conspicuous consumption.

          Be it the size of the harem, the land (and related peasantry), the factories, or the stock portfolio, in the end it all boils down to showing of how big “crown jewels” one have.

  2. susan the other

    The whole ideology of neoliberalism is a rationalization to justify wealth. But wealth might be the craziest concept of all. And the ultimate proof of this crazyness is mutually assured distruction. Which should be one of the definitions of insanity. We will kill ourselves to maintain our wealth. In a sense then wealth is a form of control, but it begs for a better definition. Maybe the reason no amount of economics can rejuvenate capitalism, after two horrendous world wars and a never-ending series of cold wars, is because capitalism is based on a vast lack of ideas. In terms of when it all began to happen, I think it might be reptilian. Certainly it was happening in the late 40s with the Marshall Plan stuff, in the 50s with all the hype about our wonderful corporations, and yes some good jobs; by the 60s capitalism could not reinvest itself productively and we went off to Vietnam to try to prevent our allies’ former colonies from bolting. And there were even more sinister forces of frustrated capitalist fantasy that thought if we got ourselves entrenched in Vietnam it might be easy to just kinda march right on into China. And today we are up to the same tricks in the Middle East. I agree that the State is looking tattered and I think it is because we based it on the concept of national wealth. Which we didn’t and still do not understand. The American Reich. If we can create one final derivative of the capitalist neoliberal state it will be the Stateless State, with ISIS as the trial run. But something tells me we have already run out of gas.

  3. jsn

    I agree with Lambert about “turn”, I agree with Tony about the political origins in the Austro-Hungarian imperialist refugees.

    It took until the 70s for Mises/Hayek anthesis to the New Deal, which Deal had greatly benefited their prostrate nation via the Marshall Plan, to fuse with MacArthur’s asiatic imperialism deployed in Japan and Korea under his administration of the peace there.

    MacArthur’s structure of Foreign Policy fused with Hayek’s vision of power/control through extraction to become the basis of domestic policy when, with Carter and stagflation, the proposals of the Powell Memo went operational.

    1. Lambert Strether Post author

      Yes, the Austro-Hungarian connection is fascinating; we get Freud, we get Mises…. And then there’s the whole Hitler thing, even though Hitler’s economics were not at all Austrian!

  4. Steve H.

    “When, for example, I entered the labor market in the mid-70s, I had expectations for state provisioning of services that I no longer have (some measure of dignity with Social Security and Medicare) and assumptions about the limits of state power that I no longer hold (the Fourth Amendment).”

    Seconded. I came in a handful of years later. Overcoming the implicit biases of the era has proven elusive. The source of the bias, indoctrinated by parents for whom the expansion of wealth was real, gave the enormous boost of optimism which fueled the credit boom while the switch was happening. Thankfully, the analytic tools acquired building up that debt allow me to take comfort in knowing I’m not alone in the struggle.

  5. Jackrabbit

    This definition dresses the wolf in sheeps clothing. It sounds progressive: the greatest good for the greatest number! But whatever “ideals” neoliberalism pretends to is trumped by the reality of practical implementation. The corruption of the public interest by powerful monied interests is a major #FAIL and leads inexorably to disaster(s).

    Unfortunately, neolibcons use this “greatest good” argument to destroy. They have convinced us that markets always produce outcomes that maximize the “greater good”. But that is a VERY false equivalence. Have a look at charter schools and private prisons. Gains are driven by union busting and go mostly to the wealthy (over time) and service redefinitions (teaching to the test, harsh policing) further destroy any value to the claims of benefit “greater good”.


    Neoliberalism and neoconservativism have merged into a neolibcon mindset of the ruling class and their lackeys and wannabes. Can any discussion of neolibcons be complete without nothing their utter contempt for ordinary people? There is no better evidence of this than the false myths, controlled press, propaganda, and outright lies that are they weave to maintain power. They don’t do this because they are working FOR us but because they are working AGAINST us.


    That we are all individuals is a truism but in practice they would have us believe: there is no society, there are only markets. The effort to make people believe that there is no agency – that markets rule us – is huge. TINA requires that there be no recourse (to individuals or human morality).

    This is probably the most religious aspect of the ideology. The “God’s will” of the modern age that excuses all manner of cruelty.


    FYI:Jesse’s explanation of the ‘Credibility Trap’

    H O P

  6. Lee Robertson

    Perhaps “class” could be considered a spontaneous confederation of like minded individuals.

    1. LifelongLib

      Not necessarily like-minded, but in the same boat. If you have to have a job in order to live you’re in one boat. If you wake up every morning and smile as you count your dividends, you’re in a different boat. You don’t have to agree with your fellow passengers about much beyond knowing which boat you’re in.

      1. Lambert Strether Post author

        That “boat” metaphor is powerful; thinking of the Titanic, the lifeboats, and an image of the ship sinking, with caption (presumably from somebody at the stern): “Sinking? What do you mean? I’m a hundred feet up in the air!”

  7. James Levy

    Neoliberalism needed cadres, and those cadres were in short supply in the generation that experienced the Depression and banded together to collectively win World War II. There was always an irredentist element among the rich who never reconciled with the New Deal (Eisenhower wrote his brother about them and thought them idiots). But they had not traction when times were good (Hobsbawm’s Golden Age circa 1949-72). By the mid-1970s you had new potential recruits in the post-war generation and economically troubled waters to fish in. What the moneyed interests discovered in the 1970s was a concatenation of factors–fear of participatory democracy as expressed in the New Left and the Civil Rights Movement, fear of a falling rate of profit, opportunities afforded by stagflation and a new generation of technocrats and “intellectuals” on the make–that created an elite consensus to back Reagan and restore the good name of wealth and privilege. The crushing defeat of Mondale in 1984 and the rise of the DLC gave the rich their opportunity to capture the Democrats as well, and they did so decisively in 1992 (but first they had to neuter the Rainbow Coalition, which they did with the leaking of the heimietown comment and the defection of wealthy Jewish interests from any Progressive coalition from that time forward). As an historian, that’s how I see the story unfolding. Of course, the Powell Memorandum, Friedman’s Free to Choose, and Sam Huntington’s Crisis of Democracy were intellectual watersheds in the process, but more IMO because they resonated with an elite audience than through any inherent intellectual power they might have.

  8. cassiodorus

    This is of course a good topic. People need to know the extent to which their lives have been marketized in line with neoliberal prescriptions — see e.g. Jennifer Silva’s book “Coming Up Short”:

    There is, however, nothing distinct about “neoconservativism” outside of the PNAC philosophy that America ought to invade countries and impose neoliberalism upon them. The neoliberals are themselves heavy into militarism, as any year’s Federal budget will show.

    Of course, as Mirowski points out, the neoliberals do not themselves agree with each other upon the particulars of their project. In a piece written at I’ve suggested that neoliberalism counts today as a form of “conservatism,” about which there are two distinct strains:

    1) Corporate conservatism, which regards society as an object to be bought off with minimal market privileges so that corporate profit can continue unmolested by public objection

    2) Antipublic conservatism, which operates in denial of the concept of society itself, so as to atomize society’s members

    The two conservatisms work today to cement the neoliberal project, for awhile at least, while granting the public the illusion that it has political choice. Of course, as the growth rate continues to decline and as the ecosystems of planet Earth get ever-nearer to total exhaustion, the whole thing may fall apart.

    1. John Mc

      You highlight such an important piece here. Neoliberalism and the strength of it relies upon being able to use many strategies, sometimes at once. They tend not to married to much, except core strategies which hide intention (sometimes), as prove to be irreversible. Mirowski’s point about there being disagreement in and between NTC is central to understanding how power works and how the system is maintained. Neoliberals are focused on winning, while the rest of us seem to focus on the emotion/logic/dialogue of a specific topic.

      Mark Blyth gets this right (his book on the dangers of Austerity), elite neoliberals engage in informational arbitrage. They try something and it works or it does not — they bring back the results to the group; they talk about how to tweek and they get better with each economic cycle. They are in the business of selling us a reality that does not exist, the brilliance-hegemony of this stealthy world view is that at the core there are very few things to tether them to detection and they can be flexible in their strategy (propaganda, direct action, manipulation of markets, diversions/false flag operations etc.)…

      This is why Proctor & Shiebingers work is so important on agnotology.

      1. Jack

        But in the long-term they won’t win. They’re engineering a system that will inevitably collapse, either through the environment breaking or a revolution and their heads on stakes. For all their scheming and fine-tuning they ultimately come across as incredibly stupid.

        1. John Mc

          Well, I love the spirit of your comment and you may be correct about an inevitable collapse.

          But I am more skeptical than yourself about a few things here.

          First, there entire approach is about establishing a racket and then keeping it; they are more long term than we are in many respects (having access to data, research, behavioral analyses and rich information that many individuals only dream about). And cleverly, they have implemented a system that extracts from citizens doing the exact opposite (using short-term goal, productivity tied to standard living measures and demanding we accept their rules or leave the ENTIRE game of employment).

          Second, their scheming and fine-tuning masks how flexible they are when it comes to change and profiting from it. It is pure shock doctrine, waiting for an opportunity to shape the next culture — apple watches, robotics, and smart appliances are the next 10 years and they already have done the leg work for building the marketplace to exploit these ideas. Another way to say this, is that they are a decade or two ahead of most us and are probably hatching some other scheme to profit from climate change and ecological disaster while saving them, their children and of course their fortunes.

          In my mind, the only real way to beat them is via the element of large and massive surprise or events that are impossible to predict and unlikely to occur, but mobilize a visible opposition to a clear practice —- over and over until most people see through the hologram that is neoliberalism.

          1. Jack

            I guess I’m from the Jack London school that the oligarchy inherently can’t last. It may take centuries, but it is doomed simply because there are a lot more of us than of them, and sooner or later the people of the abyss will have had enough (or simply nothing left to live for). Especially since neoliberal policies are creating more of those poor people through destroying the middle-class, so they’re getting rid of the very bourgeois who can act as a buffer or safety-release valve.

          2. Lambert Strether Post author

            “Neoliberalism and the strength of it relies upon being able to use many strategies, sometimes at once”

            We might consider the NTC as being a central “pillar of the regime.”

            With factions within the NTC, but the NTC nevertheless forming, as it were, the “class consciousness” of the elite, themselves divided into factions.

            I’ve often thought of the elite as managing portfolios of political/economic options — this is where the opportunism and power-seeking kicks in, through the selection of a particular option for funding — and NTC factions would be distributed among elite factional portfolios, again as options. An example of such an option would be the bait shop owners that Scaife decided to fund.

  9. Sam Adams

    A few millennia and the peasants will again rise. We’re just once again, at the stage of the roman senators concentration of lands into large agricultural farms.

    1. Jack

      But the plebeians never did rise. The oligarchs tore the country apart in decades of civil war before Octavius imposed order by becoming Emperor. He did it with broad public support, true, but it wasn’t a peasant uprising. And the oligarchs didn’t disappear, they were merely restrained. They were still there, still ran latifundia, and after a while returned to playing political games, though not to the degree they had in the late Republic. In fact the villa system survived the fall of the Western Empire and provided some degree of stability in the years that followed.

  10. ex-PFC Chuck

    If governance of, by and for all the people of the United States is to be recovered, the venomous snake of neo-liberlism must be slain. This is the defining challenge of the age. All other issues are secondary, even climate change. For unless the levers of governmental power are wrested from neo-liberal hands any attempt to enact policies for the common good will be defeated because they don’t believe there is such a thing as the common good. And nothing is more common a good than a livable planet.

  11. John Mc

    A couple of things here:

    First, this is an outstanding conversation starter. Many thanks to Lambert

    Second, the origins of Neoliberalism (as noted by Mirowski and Chomsky) seem to have originated from those who believe that “Liberalism” had failed, often pointing to the Walter Lippman’s, Edward Bernays, and the shape-shifting groups on the outside of policy debates in the West (France, Germany, Switzerland, Austria, and US) that later formed the MPS (or what became the Neoliberal Thought Collective). According to Mirowski (2014), there intent was to nurture the long term growth of a new liberalism (but this group had varying expertise, beliefs and means of achieving their objectives over the next 65 years — as MPS grew out of a meeting near Lake Geneva in 1947 (i.e. Mont Pelerin). Their story and the rise of neoliberalism has most of its juice in the 1980’s as they finally attained access to the corridors of power — fitting in nicely with Harvey’s progression of the political elite/financial ecology of the early in 1970’s.

    Two mini-concepts need to be include in this progression. One, by any means necessary (i.e. there is no alternative) became the meme when achieving local and larger objectives. And as Mark Blyth (Brown Political Scientist who has written about the dangers historically of austerity) so rightly discusses in one his lectures, is that this need not be a conspiracy, even though hidden to many. All it need be is “informational arbitrage” and knowing how to best manipulate a target audience (my piece here, using Bernays’ public relation tactics – now honed by the powerful Frank Lunz). So, beyond the Powell Memo, the rise of the thinktank network (Atlas Foundation etc.) and the reworking of capital via financialization (Costas Lapavitsas’s work here is relevant), we see how the capture of each of the levers the power is an inevitable neoliberal outcome, when considering —–> win by any means necessary (Lee Atwater, Bush election in Florida, or fabricate MWDs) combined with “informational arbitrage” and the capture of the America’s biggest corporate delivery systems (radio, television, internet, medical records, and communications), creates clear and perverse incentives for what Bill Black calls a Gresham’s Dynamic, whereby neoliberal actors push out their competition in the marketplace and call a business management guide to best practices or CEO control fraud – take your pick.

    Third, as a former stockbroker for ML and now an adjunct college professor teaching family finance, I think Harvey does have a richness, but we need more process-level information from NTC (i.e Proctor and Schiebinger — like how agnotological patterns reappear over and over — climate, tobacco, etc.). And, I am of the mind that we have to streamline a description (one I have adapted from Chomsky’s profit over people (1999) book where we see easily discernible patterns at macro and micro levels. For example, one could make the case that to be a neoliberal all one must do is:

    1. Get people to open up (sell free markets, promote open exchange of ideas to get in the door)
    2. Assess profitability (identify barriers to free trade, quantify long term profit, tilt politicians)
    3. Begin De-regulating (changes the rules, language, and process — foam the runways for NL capital)
    4. Privatize (once a revenue stream spigot is open, feed it to NL system actors so it becomes irreversible)
    – Lapavitsas has said about the finance sector: “40% of GDP is hard to reverse (financialization)
    5. Cut Social Supports (change the structure, alter relationships, foster dependence, pay to play)
    6. Protectionism (win at all costs, doing whatever is necessary to keep profits — BP, Altria, Exxon, Big Banks)

    As individuals, we replicate the same thing everyday, whether you are doctor, lawyer, or teacher. Our objectives are to:

    1. Get people to open up (individuals)
    2. Assess profitability (medical procedure – commodification of the client)
    3. Deregulation (change rules — went to dentist and they told me I had to get x-rays to get teeth cleaned)
    4. Privatize (my “book” is ownership; I own the revenue generated; I own clients – they are mine)
    5. Cut Social Supports (any relationship inhibiting my growth; I try to destabilize or discredit)
    6. Protect Profits (my job to protect the main source of my revenue — by whatever means possible.

    To me, this is the essence of micro and macro neoliberalism — it could be individuals, families or countries behaving this way. The tactics they use to get what they want are pretty similar as they have mastered the art as Lambert (Harvey) suggest of “accumulation by dispossession” or steps 1-6.


    1. Beans

      You had me until you got to the part about the dentist – the x-rays before getting teeth cleaning is not thanks to deregulation. It is due to 1. providing the means for the dentist to tell you if anything is wrong that needs fixing and 2. provide proof that the appropriate dental procedures and recommendation was made in the event of a lawsuit or complaint to state regulators. Really – x-rays before a cleaning could be considered a standard of care within dentistry.
      You have actually made an example of what would come from deregulation of dentistry – no state dental board, no rules. You could get your teeth cleaned by your barber for probably a lot less that your dentist who wants to take x-rays too. But then, do you really want your barber to be the one you go to when you have a dental problem? If common good is served by public regulation of professions, then sometimes you have to have a bit of slop in the efficiency to make sure patients are protected from hacks, crooks and incompetent buffoons.

      1. John Mc

        As a 50 year old male in this society, I am not sure I need another x-ray on my teeth, when I have not pain and my goal was to get them cleaned. While I have no pain, I do have an insurance card that will allow them monetize me and be reimbursed. Standard of care is one thing, but I could easily send my slides from my out-of-state dentist as well, but they wanted their own.

        Each profession has insulated itself, using standard practice or standard of care, to justify the revenue streams it hopes new patients will deliver. While I am certainly no dentist, and would be willing to cede the high ground here about this being a poor example, my complaint is when did the rules change where a person who wants a simple teeth cleaning had to be captured by the entire system so “as to take care of all my dental needs”? In other fields, like being a stock broker, this is how it works “here” was always code for, you don’t like it, piss off.

        Btw, my teeth are in good health, I floss regularly and I asked the receptionist before I scheduled, could I just come and get my teeth as I am new to the area. I was told sure, and then the story changed (their process dominated my own) using legal rhetoric and looking at my insurance card as an ATM….

        I am willing to see the other side here, but for me, this type of business management policy did not occur in my neck of the woods 15-20 years ago. It feels like a bait and switch for me — not to be generalized to the entire population (as I agree not everyone will react the way I did).

        If you do not like, the dentist example. All you need do is look at the change in rules for Glass Steagall, Sarbanes-Oxley, Garn-St. Germain Act, Gramm-Leach-Bliley, Citizen’s United (you get the picture).

        1. craazyboy

          Around here they are trying to charge $180 to “set up your account” if you are a new patient.

        2. bob

          It’s all about the revenue stream.

          With medical/dental stuff, its about the equipment. The dentist leases the equipment, maybe even from an LLC he owns, or not, for tax advantages.

          The entity that holds the paper on the machine, collecting 5% at least, also has something to sell now– paper, on a machine, in a dentists’ office or hospital.

          1. bob

            I do agree that an xray is pretty standard dental care, especially with a new patient. I don’t agree with the prices.

            1. craazyboy

              The way it works south of the border:

              New patient account setup includes – xrays and cleaning. The dentist does the cleaning and the assistant holds the little suction tube thingy. Cost – $35 American Dollars. Credit card accepted. Toll Free telephone number to make your next appointment. You can request whatever you want then. Cleaning only is $35. Haven’t asked yet what the x-rays cost. The office has all the latest equipment, and the one I go to gets the city guv health care contract.

    2. Lambert Strether Post author

      I like the steps, but I’m not sure those are the steps. For example, when privatizing a public institution, deliberate underfunding, followed by the inevitable scandal, should be included.

      However, I agree there’s a playbook, and there are not very many plays in it, and they are often repeated, with minor variations depending on the mark.

      1. John Mc


        Agreed. There is much more work to do with the steps and we are dealing with incomplete knowledge, most certainly. The bracketing or boundary of opening markets to protectionism is a core thesis of mine — along the way to securing enough information (assessing profitability) about the entity to ensure orderly deregulation and privatization processes. But as you adeptly suggest, there is more there, there (probably untethered to mainstream information flows).

        The deliberate underfunding of rival factions, a great point you make, could be seen as systemic precusor under the gutting of social supports in part 5. While it occurs earlier in the chronology or step mechanism, the result of this stealth in the political sphere often does not get widely noticed for decades, when we realize we really needed something in place (i.e. Glass-Steagall or Brooksley Born’s suggestion to regulate derivatives).

        The reason I use these six categories that do not quite fit is due to my training at ML, they gave me six steps:

        1. Meet the client — get them to open up (socially, financially, emotionally)
        2. Assess profitability – find out barriers, cost-benefit analyses, referral potential
        3. Change rules govern their existing relations w/ other firms (compete, ‘educate’)
        4. Take ownership of your client – (their revenue is now yours)
        5. Cut Supports – discredit competitors or notions of alternatives – dominate them
        6. Protect profits – do whatever is necessary to keep revenue stream/client

        Now, not all of this took on my acerbic tone, especially looking back after 14 years, but this is how they taught ‘new professionals’ to acclimate to the profession. Profile, Assess, Establish the rules, Own the Business, Remove Barriers (sometimes we did this in advance) and Protect Profit.

        As John Perkins (2004) reminds us in his book confessions of an economic hit man, it is the same process by which multi-national corporations wage economic warfare on those who do not play by this playbook — hence the bribe or the bullet. Our contribution to worldwide debt (HIPC – heavily indebted poor countries) seems to follow similar patterns (we start as the benevolent seller of free markets and we end owning/protecting the profits from stolen resources).

        But I am sure there are more holes to fill with this perspective. Thanks for a great topic and analysis.

        1. Lambert Strether Post author

          Ah, right out of a literal handbook. That’s awesome. We might consider creating an “ideal type” of such a handbook. Perhaps it varies by the mark client.

          Adding, “take ownership” sounds an awful lot like “enclosure,” elsewhere on the thread.

          1. John Mc

            I would love to participate/collaborate on an agnotological project of creating the “neoliberal handbook.” Frankly, I cannot think of a better gift to give society than a framework to understand this kleptocracy.

            You know, you also sparked a thought, one that has been dormant since my academic training, “mark”. Erving Goffman has something to say here as well — two pieces in particular: “Cooling out the mark” and his famous “Presentation of Self in Everyday Life”. He discusses front stage (what we tell others about our profession) and back stage practices (what actually occurs) and it is a powerful lens (connected to Agnotological study) from which to view power, the elite, and how decisions get made.

            Often it is reliant upon the whistleblower or deep throat-like resources. But hey, no one said it would be easy.

            Lastly, the clever insight about it varying by the mark is something else to explore as this is where scholars in lifespan and human development have much to teach the business world and elite culture. Erik Erikson’s stages of socio-cultural development begin at birth to 2 (Trust versus Mistrust). Of termed as attachment, the quality of one’s future relations can often be traced how well trust is modeled. And, across the lifespan there are different vulnerabilities a neoliberal playbook could exploit (or has been exploiting).

            Let me know. I would love to devote time and energy to a project like this.

  12. lyman alpha blob

    While I personally enjoy this type of critique I doubt that the subtle distinctions between neoliberal and neoconservative really resonate with most people. And I suspect that narratives like this one give way too much credit to the elites who cooked up these schemes to enrich themselves. Sure you can hire economists to obfuscate what you’re up to, but it still boils down to common thievery if you ask me and that’s something everyone can understand.

    This didn’t get much notice when it came out a couple years ago but a song from Soundgarden called ‘Non State Actor’ sums up the elite sentiment very concisely:

    “We’re not elected but we will speak
    We’re not the chosen but we believe
    And we settle for little bit more than everything”

  13. Michael Fiorollo

    Neoliberalism’s move from theory to practice begins with the fiscal crisis of NYC (aka The Banker’s Coup) in 1975 – hospital and firehouse closings, 15,000 teachers laid off, tuition instituted for a newly non-white student population at CUNY – and the passage by referendum of Proposition 13 in California in 1978. It was there that the first successful salvos against the New Deal were shot.

    1. montanamaven

      Yes, Doug Henwood chronicles this in his 1997 Book “Wall Street”. It was the first practice of “The Shock Doctrine” on the largest American city. It worked. The peasants did not revolt.

  14. Yves Smith

    The sad irony is that corporate profits did NOT collapse in the US in the 1970s, if you look at Fed flow of funds data. Harvey should have checked facts, but instead he parrots a myth propagated by corporate chieftans. Stock prices, however, were in the toilet due to stagflation, US companies were losing out to Japanese and German manufacturers, company execs perceived their social safety net obligations to be too high, and the elites as a result of the hangover of the dissent of the 1960s/early 1970s, and the power of labor, worried that the lower orders were becoming “ungovernable”.

    1. John Mc

      Correct me if I am wrong here, Yves, but wasn’t the next wave of ‘innovation’ the beginnings of financialization, as Noreena Hertz (2003) suggests, elites saw debt as a tool used to subjugate. We saw the rise of credit cards, new incentives for executive compensation in the 80s’ and an alternative financial sector arise (90s) predicated on these concepts. I wonder if Harvey is saying that corporate profits were not enough for the elite at this point, as they needed to really go vampire squid on the population (especially as they got more information about the American consumer — i.e. home equity, investment behaviors, spending predilections)

      What Harvey gets right is the co-option by elites, but I have trouble understanding the criticism of Harvey (often by Mirowski and now yourself) as the reasons to why the neoliberal era took hold. Could you elaborate?

      And are you referring to the Walter Wriston meme told on Frontline which suggested ‘bankers were going broke’ business if they did not act quickly – hence the Marquette decision (allowing bank charters to cross state lines, whereby banks (to sell credit) moved to Delaware and South Dakota?


      1. craazyboy

        There was a very bad recession in 73-74, so no profits those years. But the main story for the 70s was stagflation. ‘Course we did have management guru Peter Drucker telling all our CEOs that you must grow, or the corporation faces death. “Growth” happens as sales growth first – but profit growth is supposed to be the ultimate goal. So I can see something getting lost in translation here – the real situation probably is CEOs couldn’t get profit growth in a stagflationary times, even tho they tried their hardest to raise prices.

    2. hemeantwell

      For another factor promoting the shift in the 70s, David Kotz and others see the willingness of the Nixon administration to impose regulations on business — e.g. the EPA and OSHA — as important. Culling through Business Roundtable publications, Kotz finds dismay over Republican disloyalty as a big contributor to the push for ideological rectification. Here’s Kotz’ book.

      Kotz teaches at UMass. He’s also written very worthwhile analyses of the fall of the Soviet Union.

  15. dSquib

    Commodify natural resource through legal regime.

    However, inequality of access.

    So, “nationalisation” of said resource/commodity.

    Then “privatize” or partially “marketize” that commodity because freedom, and everyone will forget to ask why we treat it as a commodity in the first place.

    Quite brilliant really.

  16. JTMcPhee

    The propaganda, conscious or not, runs deep.And how nice of most of us to cooperate in propagating it…

    Anyone remember this little sequence, speaking of turning?

    OK, political-economical physicians, you’ve a nice set of pretty clear diagnoses (with the usual marginal arguments about provenance, syntax and naming rights.) What are the prescriptions, therapies, treatments to cure this failure of the commons and those who used to depend on it, or is it just “understand what they are doing to us” and knuckle our foreheads like good less-than-serfs as they pooch by us in their Porsches?

    We are all I guess watching to see if the Greek bug gets squished, or escapes to multiply and proliferate and all that.

    Labor as a class in generations past had its labor to withhold; now we apparently cannot even withhold consent to being Peeping Tom’d and stripped of all wealth and dignity, and suckered into savaging those even a little less fortunate than us as “useless eaters” whose hands we smash as they try to hold onto the gunwales of the rotted, leaking lifeboats we sit so precariously within, chained to our rowing benches and commanded to “pull harder” on the hawsers towing the Gilded Barges up the river…

  17. Tim

    This post deserves a space on the “Greatest Hits of NC” list, both for the quality of the comments and links to previous posts. Great consolidation of analysis.

  18. Beans

    Lambert, thanks again for another great post. I appreciate the comments too, and am always so impressed with the depth of knowledge within the NC comments.
    While understanding history is critical, I’m curious as to where we go from here. What comes after the neolib/con economy falls flat on its face? It seems that the odds of that happening in our lifetime is not remote.

  19. susan the other

    And the Powell Memorandum then led not to free enterprise, but to anarchy, then, sometime in the 2020s, to privatized violence… The genesis of the breakdown of what we thought democracy and capitalism were about didn’t start with the first cracks in the system. It started with the failure of the system to foresee (maybe admit to) its own weaknesses. Nothing lasts forever. Capitalism, or neoliberalism, or whatever, could have evolved if it had not been so blindly ideological. Even as late as Powell’s Memo in 1971, the US was still reactionary. Maybe not insanely reactionary – we did come to terms with China. It has been obvious for many decades that this country, dedicated to the idea of free-enterprise without being responsible for its consequences, has been single-minded about clearing the tracks so corporations had a smooth ride. The USA plans decades in advance – nothing just “happens.” And like all planners, they tried to slow down what they saw as threats. But they failed to address the problems. Instead they outsourced all our jobs. What a clever solution.

  20. Jeremy Grimm

    I should be doing other work but this topic fascinates me.

    I must take some exception with Lambert’s assertion at the start of his post “… that anthropologists (like David Graeber) are better equipped to interpret our political economy to it than either politicians or economists.” Neither politicians nor economists are at all equipped to interpret our political economy. Anthropologists are better, but given the depth of the literature they’ve generated — aren’t sociologists and social historians like Mirowski best at interpreting our political economy? Perhaps I just don’t understand enough about what anthropology studies, I get stuck in associating anthropology with Claude Lévi-Strauss or arcane studies relating kinship relations with low level social structures.

    As for a succinct definition of Neoliberalism — that too seems problematic based on my understanding of Mirowski’s arguments. As succinct definitions go, Lambert’s formula “because markets” is about as good as it gets. I read Mirowski as suggesting there really is no coherent philosophy to label as Neoliberalism. The label Neoliberalism serves to encapsulate a very deliberately incoherent philosophy with many layers. One moment a Neoliberal can argue for the free market and privatization and without blushing argue for passing trillions of dollars of public money to Financial Conglomerates. Arguing with a particular Neoliberal philosophy or action is like cutting off the Hydra’s head or wrestling with a gross of large snakes.

    The impacts of Neoliberalism, its broad corruption of argument and language use — moving all arguments to terms of efficiency, cost, value-added, the monetization and I would add quantification of all human life and endeavor seems like a topic best suited to skills and tools of anthropologists. Virtually all aspects of our culture have been captured by this horrendous world view.

    I view the micro-management of work, the endless weekly reports and progress charts, cost estimates, hours spent and constant push for predictions of next week’s point of progress as part of the Neoliberal mindset. I view this not as a drive for efficiency as much as a manifestation of a mindless lust for control. I view the recent introduction of large database programs to categorize work and labor as one more manifestation of Neoliberalism combining quantization with control. In part, I consider these developments as components of what C. Wright Mills called the Managerial Demiurge in “White Collar.”

    I’m not sure I buy Harvey’s assertion Neoliberalism holding “that the social good will be maximized by maximizing the reach and frequency of market transactions …. requires … pursuit of information technologies.” Bureaucracies do just fine with the work to accumulate, store, transfer, analyze, and use massive” amounts of data. Information technologies do it faster-better-cheaper, though not necessarily with any greater success. [And no I am NOT OK with NSA’s efforts in this direction. I’m arguing such comprehensive measures go beyond what is necessary to the minute control of our population. The Gestapo did quite nicely with citizens reporting on each other. Much of what the NSA is up to can be explained by “bigger hammer” thinking and the $$$$$$$$$ flowing to computer makers, software companies, and contractors. But yes it is still very scary.]

    Lambert’s assertion about Harvey’s discussion of class points to an area of weakness in the kinds of thinking and tools available to anthropologists for the analysis of political economy. I look to William Domhoff and C. Wright Mills for analysis of class structures.

    For me the contradictions in Neoliberalism do little to undermine its legitimacy in any practical sense. In my use I view legitimacy as putative and publicly accepted [if not accepted — immutable] legitimacy. Obamacare makes an interesting example in pitting two competing strains of Neoliberal thinking against each other. The outcome of the contest will do little to reintroduce discussion of Single Payer.

    The section opposing Neoliberalism with Neoconservatism has me confused. What is Neoconservatism and how is inherently different than one more strain of Neoliberalism? Neoliberalism has no problem generating or absorbing contractions. Any particular strain of Neoliberalism may have coherence that need not be consistent with other strains. Does Neoconservatism have play as an economic and political theory beyond its role in focusing political debate on issues remote from matters of economics and political power? It looks more like a tool for constraining electoral politics within proper bounds while providing cover and motivation for a militarized solution, which meshes nicely with the broader aims of Neoliberalism. What versus? they look more like partners on a wrestling tag team.

    I cannot escape from the view that Neoliberalism — the beast itself, not one of its many heads — is a drive for consolidation of power and control. The contradictions hide the underlying lust that drives this beast.

    1. hunkerdown

      The most visible difference between neoliberalism and neoconservatism to me is where the evil impurity is said to lie: in some Other or in our own humanity.

  21. Matt Pappalardo

    Speaking of Mirowski, his review of David Harvey’s A Brief History of Neoliberalism is available online:

    Thus the pressing philosophical problem inadequately addressed by Harvey is to reveal how the neoliberals as a group managed to come up with a conceptual accounting system which would underwrite their attribution of “10% slavery” to their political program. To give some idea of what Harvey lacks, we here propose a ten-point caricature of the state of neoliberalism circa 1990:

    1) The starting point of neoliberal theory is the admission, contrary to classical liberal doctrine, that their vision of the market society will triumph only if it becomes reconciled to the fact that the conditions for its existence must be constructed, and will not come about ‘naturally’in the absence of concerted political effort and organization. As Foucault presciently observed in 1978 (2004, p. 137), “Neoliberalism should not be confused with the slogan ‘laissez-faire’, but on the contrary, should be regarded as a call to vigilance, to activism, to perpetual interventions.”

    2) This assertion of a constructivist orientation raises the philosophical issue of just what sort of ontological entity the market is thought to be. While one wing (the Chicago School) made its name attempting to reconcile its idiosyncratic ‘Marshallian’ version of neoclassical economic theory with this ‘non-natural’ orientation, other subsets of MPS have innovated different versions. The Misean wing of Austrian economics, for instance, attempted to ground the market in a rationalist version of natural necessity. What later became the dominant version at MPS emanated from Hayek himself, where ‘the market ’is posited to be an information processor more powerful than any human brain, but essentially patterned upon brain/computation metaphors. In this version, the Market always surpasses the state’s ability to process information (as an anti-Hegelian Spirit), and this became the kernel of the neoliberal argument for the necessary failure of socialism.

    3) Even though there subsisted lack of consensus on just what sort of animal the market ‘really’ is, the neoliberals did agree that for purposes of public relations, and suppressing their own constructivist tendencies, the market must be treated as a ‘natural’ and inexorable state of mankind. What this meant in practice is that modern natural science metaphors would be integrated into the neoliberal narrative. It is noteworthy that MPS members began to explore the portrayal of the market as an evolutionary phenomenon long before biology displaced physics as the premier science in the modern world-picture. If the market was just an information processor, so too was the gene in its ecological niche. Because of this early commitment, neoliberalism was able to make appreciable inroads into such areas as ‘evolutionary psychology’, network sociology, animal ethology,and even philosophy (Dan Dennett, Robert Nozick, David Hull,later Popperians). Its greatest success, nevertheless, was in American economics.

    4) The primary ambition of the neoliberal project is to redefine the shape and functions of the state, not to destroy it. Neoliberals thus maintainan uneasy and troubled alliance with their sometimes fellow-travelers, the libertarian anarchists, as illustrated by the Buchanan quote. The contradiction which the neoliberals constantly struggle with is that a strong state can just as easily thwart their program as implement it; hence they are inclined to explore new formats of techno-managerial governance that protect their ideal market from what they perceive as unwarranted political interference. One implication is that democracy, ambivalently endorsed as the appropriate state framework, must in any case be kept relatively impotent, so that citizen initiatives rarely change much of anything. Hence the neoliberals attempt to restructure the state with numerous audit devices (under the sign of ‘accountability’) or better yet, convert state services to be provided on a contractual basis. However, one should not confuse ‘marketization’ of government functions with shrinking the state, as Harvey sometimes does: if anything, state bureaucracies have become more unwieldy under neoliberal regimes.

    5) Skepticism about the lack of control of democracy is offset by the persistent quest for a reliable source of popular legitimacy for the neoliberal market state. Many Neoliberals seek to transcend the intolerable contradiction by treating politics as if it were a market, and promoting an economic theory of ‘democracy’. For them, there is no separate content of the notion of citizenship other than as customer of state services. This supports the application of neoclassical modelsto previously ‘political’ topics; but it also explains why the neoliberal movement must seek to consolidate political power by operating from within the state. In this sense, the Arrow impossibility theorem and social choice theory turns out to be as neoliberal a doctrine as Buchanan’s public choice theory.

    6) Neoliberals extol ‘freedom’ as trumping all other virtues; but the definition of freedom is recoded and heavily edited within their framework. Freedom is not the realization of any political, human or cultural telos, but rather the positing of sui generis autonomous self-governed individuals, all naturally equipped with a neoclassical version of ‘rationality’ and motives of ineffable self-interest, striving to improve their lot in life by engaging in market exchange. Harvey thus (p. 184) accuses Amartya Sen of neoliberal tendencies,though perhaps without sufficient documentation. For neoliberals, freedom of thought always must be tempered by freedom of economic endeavor, if not committing outright conflation of the two, particularly when it comes to belief in the ‘marketplace of ideas’.

    7) Neoliberals begin with a presumption that capital has a natural right to flow freely across national boundaries. (The free flow of labor enjoys no similar right.) Since that entails persistent balance of payments problems in a non-autarkic world, neoliberals took the lead in inventing all manner of transnational devices and non-governmental organizations for the economic and political discipline of nation states.

    8) Neoliberals see inequality of economic resources and political rights not as an unfortunate byproduct of capitalism, but a necessary functional characteristic of their ideal market system. Inequality is not only the natural state of market economies, but it is actually one of its strongest motor forces for progress. The vast worldwide trend towards concentration of incomes and wealth since the 1990s is the playing out of a neoliberal script. This extends to the ‘marketplace of ideas’ as well: the government is not responsible for a general level of education. People get the knowledge they can afford.

    9) Corporations can do no wrong, or at least they are not to be blamed if they do. This is one of the starkest areas of divergence from Classical Liberalism. Starting with the Chicago law and economics movement (van Horn, 2007), and then progressively spreading to treatments of entrepreneurs and the ‘markets for innovation’, neoliberals began to argue consistently that not only was monopoly not harmful to the operation of the market, but was an epiphenomenon attributable to the misguided activities of the state. The firm, rightly understood, is merely a nexus of quasi-markets. Thus the modern reengineering of the corporation is itself an artifact of the neoliberal reconceptualization of the corporation.

    10) The Market (suitably re-engineered and promoted) can always provide solutions to problems seemingly caused by The Marketin the first place. Public goods do not, in principle, exist (the ‘Coase Theorem’); neither does ‘market failure’ in liberal welfare theory. This is the ultimate terminus of the constructivist orientation within neoliberalism. Any problem, economic or otherwise, has a ‘market’ solution, given sufficient ingenuity. Ultimately, fortified intellectual property rights materialize as the ne plus ultra of Hayek’s vision: since the marketplace is deemed a superior information processor, all human knowledge can only be used to its fullest if it is comprehensively owned and priced. The commercialization of science is therefore the latest installment of the neoliberal agenda. Harvey is therefore right to see a convergence of neoliberalism and postmodernism (p. 42).

    1. Jeremy Grimm

      That’s an excellent summary you found.

      One point I wonder at — those who promote Neoliberalism — some clearly are true believers. I remain skeptical of the motives driving other proponents, and would speculate those are perhaps the most powerful and important proponents behind Neoliberalism.

        1. Clive

          Looking at it from an outsider’s perspective, did you guys ever actually shake off aristocratic rule? It seems to me that it only ever morphed into a variety of different guises. The current apparitions of corporate royalty, dynastic wealth in family trusts and political families passing rule from one generation to the next are to me merely more obvious and visible manifestations of how things have always worked in the U.S.

          1. hunkerdown

            Over here, from the outskirts looking in, the power of suffrage seems to have weakened at about the same clip as the franchise was extended beyond the landed gentry. By Any Means Necessary, see. Turns out “your money’s no good here” is a good antidote to that. If they want engineered famine and aristocracy, let them get their hands dirty.

  22. Jim

    “is the question of the state” on the agenda? Should it be?

    Debating and discussing the question of the state or ( how to use power) is of vital importance as we now face the creation and evolution of a largely new order now completely spinning out of democratic control.

    I have argued for many years, on this blog, that Marx’s political philosophy remains the most underdeveloped element of his critical theory. In his critique of Hegel, Marx did conceptualize true democracy in terms of the dissolution of the State as a bureaucratic political form. In his “Civil War in France (1871) he also again mentions that democracy depends upon the abolition of the State and its replacement with democratic institutions. In his more concrete discussion of the Paris Commune he describes rough new political forms in his examples of the decentralization of executive and legislative bodies into a system composed of elected individuals within system of wards who are responsible to such wards as well as his call for a dismantling of the church apparatus and a democratization of the Judiciary.

    But Marx is primarily remembered for his more anti-political stance which tended to deteriorate into a type of managerialism. Early 20th century Socialists saw the concept of the dictatorship of the proletariat solely in terms of an institutional political order controlled by the revolutionary party–the rule of the proletariat through the conquest of political power by the working class and the establishment of a workers’ state consisting of a unified and centralized political apparatus led by an intellectual party elite.

    If Marx saw class it terms of its relation to its control over a surplus of production and if socialism is identified with the abolition of exploitation–with the abolition of such external expropriation–isn’t politics eliminated from such a movement? Isn’t the State rendered superfluous with the elimination of such supposedly fundamental productive contradictions? Supposedly we are left with a situation– with the eradication of class domination,– of simple administrative functions watching over the interests of society!

    It seems to be the case that precisely to the extent that Marx endorsed the affirmation of the need to forcefully impose unity on individuals that the foundations of Stalinist oppression were created.

    The commetariat at NC has not even taken the first steps to begin to analyze how to use power. If a new antic-democratic order is now almost structurally in place any viable alternative must have this question at the center of its concerns.

    Do questions of populism, federalism, decentralization and the nature of bureaucracy once again become central as they did at the founding of our country?

    1. JTMcPhee

      You got it. Power exists, and people of a liberal bent, whatever that means, are scaredycats, afraid of it even while they are patently being beaten and robbed by people who don’t have those dainty reservations and sensibilities. The Greeks who hold the nominal legitimacy at the moment have a huge lot of power available to them, but the Wise Advice is “Oh, you can’t even threaten to use it, you must play safe by the rules, be nice and shine your shoes before the meetings you are summoned to!”

      Our US and UK and French and Soviet rulers had no problems using various powers to rob the less organized and less well armed nations and tribes, and were insanely ready to use the power to blast the whole species, came very close on several occasions to loosing the MADness on us all, and still hold us seconds away from a nuclear oopsiedoodle. Anyone who wants to try to steer the Collective in a different direction had better at least master the sangfroid of a Kissinger or Khrushchev, and figure out how to disarm and convert or otherwise disable the whole effing Matrix.

      But it is a lot of harmless fun to debate the roots and tangles of the present circumstances, isn’t it? Show our erudition and fall so easily into invective and personalities? I wonder how earlier tool users avoided that behavior when the Captains of Industry and Trade dispatched the Cossacks out of the barracks…

      1. Ulysses

        “Anyone who wants to try to steer the Collective in a different direction had better at least master the sangfroid of a Kissinger or Khrushchev, and figure out how to disarm and convert or otherwise disable the whole effing Matrix.”

        This is very true! Our difficulties lie not so much in correctly understanding the praxis of oppression, as in conceiving of viable methods to remove the boots from our necks.

        The neoliberals themselves rightly fear that their own rationalizations and justifications, for the increasing concentration of wealth into fewer and fewer hands, will not survive critical scrutiny. They relentlessly propagandize and disinform us– yet they are too unsure of the efficacy of their brainwashing to slow their construction of an enormous surveillance grid, and militarized police state.

        I firmly believe that if enough of us refuse to collaborate with this system it will eventually collapse. We don’t need the parasitical, transnational kleptocratic classes at all. Yet they desperately need us to continue deluding ourselves that there is no alternative to a system that only benefits them.

        We already know that the status quo does us no good. The time for polite complaints and internet petitions is over. Now is the time to demand that the kleptocrats surrender their power, and allow us to beat their swords into ploughshares.

        There is an alternative, and it is fairly simple. A vastly decentralized, organic world of autonomous communities– where people share in the common resources that sustain humanity, and look after each other as brothers and sisters in the same human family.

      1. James Levy

        Well, at least from my perspective, any Left I’d want to be a part of would be about education, debate, and consensus, not force. If I liked the idea of force I’d kowtow to the powers that be and share in their looting. The point is to make a world without looting, a world without baton-wielding thugs keeping us in line. The Bolsheviks bought the notion that the ends justify the means, and all they wound up with were the means. You can’t slaughter and terrorize your way to a more just, gentle, and ecologically sustainable future, or at least I don’t think you can.

        1. JTMcPhee

          A little anecdote about power that may just be a figment of my aging memory, from something I recall reading in Environment Reporter or similar source, back in the late ’70s or early ’80s:

          Somewhere in South Asia, as I recall the event, one of the big European chemical producers, maybe Ciba-Geigy or Bayer, found a great place for a plant making pesticides. On an estuary with a deep-water central channel, hydropower available, raw materials from related extraction businesses close at hand. Government approvals were obtained by the usual methods, and assurances given to “the locals” that their lives, livelihoods and environment would be safe. Skip 10 or so years; the air stinks, huge waste piles are growing, the locals are having strange diseases, and the fisheries have about been wiped out. Complaints to “the government” and the corporate management on site produced meetings and “gifts” and blandishments and promises and denials. Went on a few more years, with rising harms to the locals. Finally one night the locals just went in and burned the plant to the ground.

          Think how the fallout from that would be processed under TPP-TTIP.

          At some point, something other than gentle persuasion of the Quaker kind gets to not be enough, when it comes to self-defense and just continued survival.

          1. Ulysses

            “At some point, something other than gentle persuasion of the Quaker kind gets to not be enough, when it comes to self-defense and just continued survival.”

            True dat.

  23. Matt Pappalardo

    Lambert linked to Davies’ “Neoliberalism: A Bibliographic Review” above, and mistakenly referred to it as a review of Harvey’s book. Rather, it is a brief overview of the scholarly literature on neoliberalism. Nevertheless, it is a useful resource for those looking to augment their understanding of the neoliberal project:

    “In an effort to get away from the simply pejorative use of the term neoliberalism, which can be attached indiscriminately to various forms of anti-democratic or pro-corporate power, the more historicist approach to the concept highlights its fluidity and contingent development. However, this approach also risks lapsing into pure historical description, without critique or an account of how ideas translate into policies and strategies. Others apply a more sociological and critical method, which aims to examine which aspects of neoliberalism are at work amongst elites and governments today. This poses the question of precisely how much of neoliberalism has survived the global financial crisis, and through what means this survival has been achieved.

    Definitions of neoliberalism across these literatures are various. But they tend to share four things:

    1. Victorian liberalism is viewed as an inspiration for neoliberalism, but not a model. Neoliberalism is an inventive, constructivist, modernizing force, which aims to produce a new social and political model, and not to recover an old one. Neoliberalism is not a conservative or nostalgic project.

    2. Following this, neoliberal policy targets institutions and activities which lie outside of the market, such as universities, households, public administrations and trade unions. This may be so as to bring them inside the market, through acts of privatization; or to reinvent them in a ‘market-like’ way; or simply to neutralize or disband them.

    3. To do this, the state must be an active force, and cannot simply rely on ‘market forces’. This is where the distinction from Victorian liberalism is greatest. Neoliberal states are required to produce and reproduce the rules of institutions and individual conduct, in ways that accord with a certain ethical and political vision.

    4. This ethical and political vision is dominated by an idea of competitive activity, that is, the production of inequality. Competition and inequality are valued positively under neoliberalism, as a non-socialist principle for society in general, through which value and scientific knowledge can best be pursued.

    This bibliographic essay focuses on texts drawn from sociology, history of economics and more historical or cultural traditions of political economy, to look at the ideas, rationalities and policies through which neoliberalism is constructed and sustained. It does not address the political-economic question of how neoliberal economies have actually performed empirically…”

    William Davies’ new book, The Limits of Neoliberalism: Authority, Sovereignty and the Logic of Competition, may also be of interest to NC readers. For those without the time, he laid out his main ideas in a two-part interview published last year at New Left Project:

    The way in which I define neoliberalism is that it’s not primarily about opening up markets, or about deregulation or privatisation, and it’s not about shrinking the state. What I argue is that neoliberalism is about the extension of market-based principles and techniques of evaluation into various non-market domains, including the state, cultural institutions and social institutions. It’s the expansion of forms of evaluation and forms of measurement and forms of judgement which tend to originate in and around the market, but which are pushed into the domains which lie traditionally outside of it. There are a couple of ways in which this is done. One way is to push neoclassical economics, which originates as a means of analysing markets, into areas of politics and society, such as law, which is one of the areas that I look at, and to analyse those institutions in terms of measurable efficiency. This is what the Chicago School of economics is best known for. Gary Becker is the most famous proponent of this process, which is often called economic imperialism, but I argue that Ronald Coase, who is less commonly recognised as a neoliberal, is a more important exponent of this expansion of neoclassical economics into various social and political domains, and it was actually Coase’s theory of transaction costs that was fundamental to how the neoliberal state progressed.

    The second area I examine is the use of business strategy; theories of strategic advantage and competitive strategy that originate in business schools in the second half of the twentieth century and which are pushed out of the realm of managing corporations, which they were originally invented for, and into the realm of political decision making. This is how we get notions of national competitiveness, regional competitiveness, or urban competitiveness. The same tools and instruments and theories which were originally developed to enable chief executives of corporations to consider the identity and strategic direction of their firms are expanded for use by politicians and those in the executive branch of government to think about the strategic direction of entire polities vis-à-vis some notion of the global competitive game.

    Finally, the Australian website, Progress in Political Economy (PPE), has recently featured a number of fascinating pieces on the subject of neoliberalism. They’re especially helpful if you want to compare the ideational approach (e.g., Mirowski) to a historical materialist approach:

    1. Jeremy Grimm

      I scanned the references you made at the bottom of your comment — I have yet to ready your earlier reference in the comment above this one.

      I don’t intend to be offensive — but really — “compare ideational approach (e.g., Mirowski) to a historical materialist approach” which you nabbed from “Ideas, Interests and Neoliberalism.”

      Another choice string of text, from “Hoodwinked by Hayek”, your first reference:
      “In some respects the analysis parallels a critique of neoliberalism in the fold of Giorgio Agamben and Mirowski is critical of Michel Foucault’s tendency to set too much store by neoliberalism’s anti-state pretensions, for example in The Birth of Biopolitics. Often, however, such Agambenian critiques of the neoliberal state of exception have a tendency to invoke quite problematic and essentialising notions of sovereignty, attributing to the state precisely the kind of capacities for seeing and knowing that both Hayek and Foucault argued against.”

      Do you really spend your time reading this kind of stuff? I thought Mirowski was a difficult read but I think the guys you referenced are trying way too hard.

      My take away about Neoliberalism from the readings you referenced comes from “Ideas, Interests and Neoliberalism.”

      “The real question is this: cui bono—who benefits?”

      1. Matt Pappalardo

        Yes, I did nab the terminology from Matthew Ryan’s piece because it appears to be a (largely) accurate characterization of the two respective positions/approaches. That being said, I agree that the excessive use of academic jargon can be problematic when attempting to reach a general audience. Konings, however, originally wrote his review for an academic journal (Journal of Social Economy) that is primarily read by other scholars. Perhaps it should have been modified before going up on PPE, but, in my estimation, it is still intelligble to the well-read layman/amateur.

        Also, I am not offended by your (blunt) criticism of my reading habits. It’s certainly not for everyone since it can occasionally require a fair amount of patience and attentiveness to cut through the specialized language.

        1. Lambert Strether Post author

          I think of the academic language and conceptualizing (much of which is, even these days, excellent, perhaps because scholarship can be fun) as being like machine tools — tools to make tools. Something like “inverted totalitarianism,” which doubtless has an entire scholarly apparatus supporting it, is a machine tool. You wouldn’t put it on a banner. The slogan(s) derived from the concept and aimed at, well, whoever, would go on the banners. They would be the tools.

    2. hunkerdown

      “[the] idea of competitive activity, that is, the production of inequality” — I would like to highlight this. “Competitive activity = the production of inequality.” It’s not quite a bumper sticker, but the equation seems to get directly under the blind faith that systems are faultless and that The Wrong People are to blame for the unfit outcomes the systems deliver.

  24. Greenguy

    I do think Harvey is correct to look at the 1970s as the beginning of neoliberalism, specifically the crisis of profit valorization that did not full resolve itself until 1979-80 with the rise of Thatcher/Reagan, although Carter certainly began some of the policies Reagan later put into practice. However, this is only part of it. It is worth placing neoliberalism within the larger context of Kondratieff long-wave cycles, specifically those described by Immanuel Wallerstein and Giovanni Arrighi. Wallerstein’s work is seminal, and if you have time his (currently) 4 volume series History of the Modern World-Sytem is a masterpiece of historical insight and political economy. Arrighi’s text “The Long Twentieth Century,” which has more bearing on the current issue, posits that:

    1. Marx’s theory of capitalist commodity circulation, the M-C-M’ cycle, can be mapped onto the patterns of hegemonic rule by major powers during the capitalist era (roughly the 16 century onwards) and the systems of capital accumulation they construct around their geographic rule.

    2. These hegemonic cycles have a half which is concerned with the expansion of productive economic power in the hegemon and productive industry (the M-C half), but also signal/terminal crises that begin a financialization of the hegemonic accumulation cycle when the return on the rate of profit from productive expansion in that era has reached its peak. Thus 1968/73 was the signal crisis of the US cycle of accumulation, and we are close to the terminal crisis at this point.

    3. Neoliberalism is thus the outgrowth of the US cycle’s financialization phase, and an attempt to deal with the expansion of labor’s power during the productive phase. Other hegemonic cycles had similar, though differing financialization phases which lead to the rise of another power.

    4. There is a real question whether the capitalist world-system is in terminal decline. If so, what will replace it? Here Wallerstein has lead the way, rephrasing Rosa Luxemburg’s old question of “socialism or barbarism?” If the world-system is doomed in the medium-term – say the next 30-50 years – will its replacement be better or worse?

    1. LifelongLib

      At least at the ends of the Roman Empire and the feudalism, their successors (large landowners and merchants respectively) were already important and somewhat rebellious parts of what they replaced. It’s not at all clear what segment of today’s economy would replace capitalism. It’s not as though socialist nations are sprouting up all over the world and straining at the bonds of the existing capitalist order, or that the various small-scale alternatives many people here at NC are exploring are anywhere close to taking over. Sadly that leaves barbarism.

    2. Lambert Strether Post author

      Thanks for connecting Arrighi and the “neoliberal turn.” I should have thought to make that connection myself; The Long Twentieth Century is just terrific.

  25. montanamaven

    I’m about a third of the way through David Graeber’s “The Utopia of Rules”. On the second page of the first chapter “The Iron Law of Liberalism and the era of Total Bureaucratization”, Graeber presents a graph. It is a graph of how frequently the term “bureaucracy appears in books written in English in the last 100 years. It peaks in 1973. Then takes a sharp fall. On the other hand, how often the word “paperwork” is mentioned keeps on climbing steadily up. In an earlier book, he sees the year 1971 as pivotal. It is when the US went off the gold standard internationally which “paved the way for the financialization of capitalism” and what he believes to be the beginning of the end of capitalism.
    This new book is not about that long term end, but what happened in the short term. He sees a shift of class allegiances in the corporations from the management staff aligned with the workers with the investors as outsiders to the alignment of management with the investors at the expense of workers. He notes that the Right has a flawed critique of bureaucracy, but the so called “Left” doesn’t have any critique at all.

    1. montanamaven

      I realized I wasn’t clear about the graphs. Though the use of the word “bureaucracy” declines, the amount of “paperwork” generated by bureaucracy is talked about more and more. So there is a denial of the concept of bureaucracy in the main stream writing that Graeber is exploring in this book. As I said, I’m only one third of the way through it and it’s not a super easy read. It is our gatekeepers in both parties and in the press that are keeping Americans in the dark and in separate rooms or “boats” as someone above mentioned.

      1. Lambert Strether Post author

        “Paperwork” is the lived experience of encountering bureaucracy. So I don’t know if it’s “denial of the concept” as the typical human failure to abstract.

  26. TG

    Well, yes. But Neoliberalism, ultimately, is about nothing but power. All that talk of markets and freedom etc. are mere camouflage, as a Caddisfly larvae covers itself with sticks and rocks to hide its nature.

    Neoliberalism is quite simply the doctrine that the rich and powerful should have total control over all aspects of a society: economic, political, cultural, social, etc. Neoliberalism is the freedom to choose to own slaves. It is the freedom to have open trade when the rich want that, and the freedom to restrict trade (like in legal prescription drugs) when they want the opposite. Neoliberalism insists that people are cattle, and even goes so far as to demand that the number of children that people have should ultimately be centrally controlled the same way that the government controls the money supply – because the people themselves cannot be trusted to make that decision (Too extreme? You hear about what Jeb Bush says about the fertility rates of various national groups?). Neoliberalism insists that the rich be allowed to bribe judges and politicians to get the laws (and perhaps more importantly, the interpretations of the laws) that they want. I mean, if you want a judge to rule in your favor, and you can’t meet the going rate, well that’s just ‘the market’, isn’t it? Neoliberalism demands that only the rich have standing in court.

    Neoliberalism is feudalism and the divine right of kings, all over again. New bottle, old wine.

  27. washunate

    My first reaction is to be fascinated by that definition. I would say the neoliberals stand for exactly the opposite. They despise entrepreneurship and have done everything possible to undermine private property rights, free markets, and free trade.

    Neoliberalism in our time is a form of fascism, not capitalism. It loves centralized, top-down power in large organizations, not decentralized, bottom-up empowerment of individual human beings. It doesn’t like the free flow of information, people, ideas, and goods. It likes to manage that flow, restrict it, control it. It doesn’t embrace diversity and pluralism; it embraces conformity and Self vs. Other. It values paternalism over self-determination.

    That’s not to gloss over the many operational difficulties in implementing market-based economics. It’s just to point out that neoliberals hate markets.

    1. Ulysses

      They have “done everything possible to undermine private property rights??!!?” And this is why we don’t see any millionaires and billionaires anymore?

      Your comment would make a lot more sense if you pointed out that the small handful of people in the world, who own an obscenely huge amount of the world as their private property, are very secure in their possession of that wealth in our current system. The people who are insecure in their private property rights are those who have too little private property to fend off the predations of those who have far too much of it!

      1. washunate

        That wealth comes from theft, which is a fundamental perversion of property rights. Legalized theft.

        Look at the Forbes 400 for example. The huge amount of wealth comes overwhelmingly from government perversion of property rights and direct subsidies. IP law alone has done horrible things in technology, media, agriculture, and medicine. And then there’s financial fraud. And tax policy designed to help rich people and big organizations. And all the bailouts…

        And then there are the more direct parts of the oppression, like the drug war. Putting someone in jail for possession of a controlled substance is pretty much the antithesis of property rights. Of course the busybodies don’t put themselves in jail for drug use.

        The problems of excessive concentration of wealth and power are very much up my alley. Public policy has been at the heart of creating that circumstance over the past few decades.

        1. Lambert Strether Post author

          “theft, which is a fundamental perversion of property rights” Well, yes and no.

          No, since primitive accumulation is surely theft (and one of Harvey’s themes that I didn’t mention is modern enclosure).

          Yes, since the social formations into which property rights have been introduced via the bootstrapping process of primitive accumulation look askance at continued primitive accumulation.

          For example, people related to my ancestors stole the Penobscot’s land some centuries ago, though a combination of chicanery and being better armed. That doesn’t mean I would not face social sanction and censure if I stole my neighbor’s land today (unless I could work out how to do it under color of law).

          So I would revise your statement to read:

          theft, which is a fundamental perversion historical basis of property rights

          Fixed it for ya.

          1. washunate

            That’s because the way contemporary looting works is through the money creation and distribution system. History informs the present, but we have to start somewhere in analyzing things as they are now. Right now, the main issue is policy-induced wage inequality. Some people’s labor entitles them to more land than other people’s.

            Of course you can’t take your neighbor’s land directly. That’s barbaric and beyond our modern sensibilities. But if you have a cushy job to prosecute impoverished black people or spy on Americans or whatever, and use those wages to buy your neighbor’s land, then the full weight of our legal system will be on your side. And of course as you go up the wage scale, the really rich people live in entirely separate places.

            I’m not defending the way our forefathers dealt with this continent. I’m pointing out it wasn’t capitalism. Markets and rule of law and property rights have nothing to do with constantly making and breaking treaties. And of course our Constitution itself enshrined slavery. If we ever get too giddy about our glorious revolution, there’s always the 3/5 compromise to sober us up.

            There are two responses to the challenge you identify: abandon the concept of individual rights, or work to refine and improve them.

            Socialism honestly advocates collectivism over individualism, and capitalism places the emphasis in the other direction.

            But neoliberalism deceptively advocates the former while cloaking itself in the language of the latter.

      2. Tony Wikrent

        To expand a bit on washunate excellent comment “That wealth comes from theft,”

        Look, I don’t have a problem with people getting rich – so long as they are getting rich and benefiting society at the same time. I think there is a very clear line between Jamie Dimon and Elon Musk. I also think it is very clear that Marxist class analysis is useless in distinguishing that line. One of the reasons the left as been such an utter failure.

        The really important class division in society is between producers and predators (Veblen termed the predators the Leisure Class) – and there are a lot of producers that end up being included and condemned in Marx’s capitalist or owner class. The implications are pretty damn important. Lenin’s and Stalin’s determination to annihilate the krulaks in Russia was one result. The krulaks were the wealthier peasants, usually able to hire other peasants to work for them, and they were the backbone of Russian agricultural production: they were the producers. Oppressing and dispossessing the agricultural producers resulted inevitably in a catastrophic collapse of agricultural production: the famines of the 1920s and 1930s

        In Veblen’s producer / predator analysis, the major struggle in modern economies is the one between industry and business, is immensely valuable. Capitalists who want to build the 1.7 billion home solar power systems we need? Good – even if they are still capitalists. But, capitalists who want to stymie the move to renewables, like the Koch brothers, in order to continue profiting from fossil fuels? Or capitalists who want to identify and buy up emerging companies in renewables and add them to their already immense corporate empires, such as General Electric, and cartelize the industry? Bad.

        When it became clear to me, 2008-2009, that Obama was unwilling to confront the power of Wall Street, I began to research the question: what is the political economy of a republic supposed to be? The United States was founded as a republic at a point in world history when almost all other nations and countries were ruled by monarchies and oligarchies. Surely, the principles of political economy in a republic were different than in monarchies and oligarchies.

        And I found that they are. And I also found that those principles in the USA had become so vitiated as to be nearly dead.

        Above all else, what marks the political economy of the American republic as different is the Constitutional mandate to promote the general welfare. And a very important point about neo-liberalism is that it explicitly attacks the concept of the general welfare as the slippery slope to totalitarianism; i.e., Hayek’s The Road to Serfdom. Neo-liberalism, then, is a direct assault on one of the principle design features of the American republic.

        Now, you can look at American history, and all the sordid examples when the ideals of republicanism were not met, even violated, and you can look at the USA today, with the worst economic and wealth inequality in the industrialized countries and a political system that is clearly dominated by the rich, and lazily argue that the American republic is no different and certainly no better than the worst monarchies and oligarchies. But I think the correct way to look at the situation is to understand that there are supposed to be very real fundamental differences between a republic, and monarchies and oligarchies, then to examine history for the why, who, and wherefore that those differences have been blurred or even eliminated, and go after the bastards who did it.

        I am, for example, inordinately proud that I came from Chicago and northern Illinois, whence also came the Eighth Illinois Cavalry, whose troopers on a picket line fired the very shots of the Battle of Gettysburg. Get the idea?

        1. Jim


          I have read your comments quite carefully both here at NC and your longer essay “Whose Ideas” on your blog. All are excellent and hope you continue to participate in the discussions here at NC.

        2. washunate

          Enjoyed the comment. I think that’s why my first inclination is to look at the definitions. It lays the groundwork for what follows. Talking about market exchanges misses what’s going on in a world of mortgage guarantees and carried interest and e-verify databases and media consolidation.

          I very much agree that the capitalist/labor framework is unhelpful. I also agree that predation is a better framework. I’m not sure how much I follow industry vs. business, though. That sounds like a capitalist/labor arbitrary distinction that isn’t really that helpful in describing things today.

          Another meandering thought. I wonder how much of our present system Hayek himself wouldn’t be more opposed to than supportive of at this juncture? As I like to say, even Milton Friedman and Ron Paul opposed the drug war.

          1. Tony Wikrent

            If I recall correctly, Veblen’s discussion of industry versus business is in The Engineers and the Price System, which he wrote some two decades after Theory of the Leisure Class. What the idea boils down to is that it is industry which actually creates wealth, while it is business which extracts and appropriates the wealth created by industry.

            I suspect most people stumble because of their simple idea of what “industry” means. From Veblen, I have more of an anthropological and sociological understanding of industry as a complex system of managed relationships of workers varying from unskilled to highly skilled in the use of tools.

            Another really interesting concept that I believe is in The Engineers and the Price System, is “sabotage.” What Veblen discusses here is how business interrupts or constrains the industrial system to artificially create shortages, in order to prop up prices and profits. This gets really interesting once you realize two things: 1) industrially (and agriculturally) we can produce as much as we need, and have been able to since the 1920s-1930s in the advanced countries, and today in almost all countries. And 2) since mainstream economics continues to insist that economics is about how we allocated scarce resources, mainstream economics is a crock of shit because it does not deal with the reality of industrial plenty. In November 2013 I wrote about Peter H. Diamandis and Steven Kotler’s February 2012 book, Abundance: The Future Is Better Than You Think: Would you like a serving of hope for Thanksgiving?

                1. Lambert Strether

                  That’s a very interesting book. Eesh. One more book to read. But it does seem to be looking at fundamentals in a useful way.

                  1. skippy

                    I like the keywords section….

                    Reads like one of my cryptic crossword offerings…;

                    Skippy…. when gold replaced jade what actually occurred thingy…

                2. Ulysses

                  Thanks for this link! And thanks to everyone for all the well-written comments just preceding this one. I am particularly intrigued by Washunate’s proposal that predator/prey may be a more useful binary construct today than capital/labor.

                  There are indeed many predators in today’s society who don’t gain their wealth simply as capitalists skimming off the surplus value of other’s labor.

                  Consider a “contractor” who “advises” various parts of the MIC, for hefty fees, on how to continue doing such a bang-up job in Syraqistan. He or she relies on the IRS skimming money from those who labor, throwing it into the huge bottomless pit that is the MIC budget, and then extracting his or her cut of those trillions.

                  1. Lambert Strether Post author

                    Well, there is a crash cycle built into predator/prey relations. On the other hand, I’m not sure if I’m seeing a metaphor, or a rigorous proposal (though that is not a demand addressed to anyone).

                    For example, we don’t see workers (deer, say) proliferating because there aren’t enough capitalists (wolves, say) around to keep their numbers down.

                    I think for an ecolologist, predation has rigor. For a political economist, supposing the two disciplines to be distinct?

            1. LifelongLib

              Yet more I should read…

              I believe one dynamic is that companies are founded by people with great personal interest in what the companies are doing, but when the founders retire or die control is handed over to less interested family heirs and/or professional managers. Then big money comes along and buys them out. Ownership eventually ends up in the hands of people who only care about return on investment and have no interest beyond that in what they own.

        3. Lambert Strether Post author

          Hmm. To play devil’s advocate here: In what way is exploitation for profit not predation? Is slavery predation, and wage labor not, because the body is only rented, and not sold?

          1. washunate

            Personally, I’d say the conceptual distinction is the idea of consent. A voluntary exchange vs. a coerced one. An equal power relationship vs. a power imbalance.

            Unpaid labor can be voluntary and indeed quite rewarding in non financial means, while paid employment in the formal economy can be predation. It depends on the circumstances. Or to say that differently, in my view, all slave labor is predation. Some wage labor is predation.

            1. Ulysses

              “Some wage labor is predation.”

              I would change the word “some” to “most” in the context of today’s predominantly low-wage labor market in the U.S. Yet it is true that there are still a substantial number of people who are paid to do things they enjoy, and paid enough to live relatively free of stress. Both of my parents, for example, were paid pretty handsomely to “work” as professors at an Ivy League University. They would be the first to admit that they were extremely lucky– in having a very low amount of drudgery to perform, and the chance to devote most of their time to pursuits that they enjoyed.

              1. washunate

                Well said. Lambert and I have some differing opinions about the value of paid employment, so I tend to be more conservative with my language there. But I have no problem agreeing that most work, frankly, just sucks in our economy. Even talking to highly paid professionals you can see how fundamentally broken our institutions of law and medicine and banking and so forth have become. Doctors today are owned by hospitals, lawyers by corporate firms, etc. You can’t go work an average job or take a break to raise kids because you owe vast sums of money to professors and deans for your credentials – an amount so huge no normal job can pay it off.

                It’s particularly glaring when comparing the bulk of the workforce to the jobs that are still left in the remote islands of decent working conditions and meaningful activity.

  28. Calgacus

    As a prequel to the 20+th century history of neoliberalism and its antecedents, I recommend Domenico Losurdo’s Liberalism: A Counter-History for a nuanced history of illiberal liberalism (& liberal non-liberals) – his narrative ending in 1914.

  29. Roland

    Neoliberalism couldn’t have gotten mass electoral support in the 1980’s without the working class being deluded into thinking of themselves as “middle class.” When people in a capitalist society think that everybody can become a bourgeois, it’s not surprising that voters tend to identify themselves with pro-bourgeois policies.

    The mid-20th century welfare states were in a way victims of their own success. Mixed-economy welfare states mitigated many of the evils of capitalism, and raised the consumption level of the proletariat to near-bourgeois heights. Many proletarians began to identify their own interests with those of the bourgeoisie. An entire generation of proletarians grew to adulthood during the late 20th century with scarcely any political class-consciousness.

    That’s a big part of the reason why the neoliberal bourgeoisie won such a rapid and crushing series of victories over the proletariat throughout the developed world. Seldom has so much plunder been won, with so little actual fighting.


    @Tony Wikrent 10:50 AM,

    Much of the narrative of the American and French Revolutions comes from a bourgeoisie which at the time was a struggling, and sometimes even oppressed, class. Fancy a time when the bourgeoisie needed class allies to prevail. Liberal bourgeois even today sometimes try to conjure the nostalgia of a class alliance like some sort of “Spirit of ’76” painting (bet you the prole’s the one with the head wound).

  30. Erik

    At the end of the day neoliberalism is about drinking the Kool Aid that the system works and that your position in it is justified, all while avoiding the nasty guilt-ridden implications of good old-fashioned right wing. You’re not better because you are white or European or were born rich or into royalty. You’re better because you’re better, and the system identified you as such through your success. Therefore the system works, and must be spread. I’ll bet that the neurological processes underlying all this are probably pretty much identical to those we would have seen if we had fMRIs in the era of Calvinism.

    1. Ulysses

      “At the end of the day neoliberalism is about drinking the Kool Aid that the system works.”


  31. lylo

    As far as I can see, we already have a word for neoliberalism: FEUDALISM. (They seem inclined to destroy honest markets and replace them with elite controlled constructs with which to siphon wealth from the plebes while we beggar for basic necessities from our hopefully generous lords. What else do you call the that?!)
    And as far as neoconservativism: FASCISM. (I’m sorry, don’t call nationalistic militarization under an authoritarian regime anything else, please.)

    We have words already made for use. Why do people feel the need to keep coming up with new ones when the old ones are perfect? Oh yeah, that’s right! Distraction! (I’ve known people who call themselves neoliberals and neocons, but foamed at the mouth when called feudalists or fascists, which is what they are.)
    So, as part of my campaign for honest language, I would suggest everyone start using the true terms instead. (“Imagine your grandfather’s face if he knew you have voted for a fascist!” hits pretty hard.)

    Also, anyone else find it really sad that our options are feudalists or fascists?

    1. Lambert Strether Post author

      Because neither the words nor the concepts are, in fact, perfect; see the whole thread. And I take “distract” extremely ill; if I want to distract, there are surely more efficient ways for me to do it than posts like this. I mean, perhaps I should start posting on professional sports?

  32. lee

    For those of us who continue to beat our heads against the wall of increasingly absurd and untenable Democratic partisanship at Daily Kos, it would be lovely if this were reposted there. I know of at least one person who is regularly granted permission to quote from Naked Capitalism articles, sometimes in their entirety, on Daily Kos. Is there some reason, besides visceral revulsion, that you don’t post directly on that site? While third-party advocacy is still not allowed there, although I do see increasing dissatisfaction with the policy, trenchant criticism of Democrats from the left certainly is, and it is particularly prevalent regarding this topic.

  33. Jacob

    Here’s an assortment of quotes from my personal notes which I made while reading Harvey’s excellent book.

    Enclosure of the commons, which generally translates to privatization of public assets, is a main theme in Harvey’s book. For example, here’s a quoted paragraph about the drugs your doctor tells you to take:
    page 52: “Worst of all, public assets were freely passed over into the private domain. Many of the key breakthroughs in pharmaceutical research, for example, had been funded by the National Institute of Health in collaboration with the drug companies. But in 1978 the companies were allowed to take all the benefits of patent rights without returning anything to the state, assuring the industry of high and highly subsidized profits ever after.”

    And here’s a quote which gives a clue about why today’s official employment/unemployment numbers are untrustworthy:
    page 53: “Neoliberal theory conveniently holds that unemployment is always voluntary. Labour, the argument goes, has a ‘reserve price’ below which it prefers not to work. Unemploy­ment arises because the reserve price of labour is too high.” He goes on to explain that neoliberalism considers that welfare payments, part of the neoliberal-targeted social safety net, make people lazy and thus they make a personal choice not to work.

    And here’s an interesting note about a popular PBS program hosted by neoliberal economist Milton Friedman:
    page 44: “A TV version of Milton Friedman’s Free to Choose was funded with a grant from Scaife in 1977.”
    Later on, Richard Mellon Scaife funded the “Arkansas Project” which sought to undermine the Clinton presidency and which led to the impeachment proceedings against Clinton.

    This is a very good book, one of the best about neoliberalism.

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