One thing that has happened over the last 50 years is that income tax rates have decreased and been made less progressive. Ronald Reagan had an important role in this and it is one part of his legacy that Donald Trump has furthered. A rationale for decreasing taxes is that this would promote growth. Decreasing taxes have certainly been associated with increasing inequality
Man I'm really late on the draw on this but.....when I was in college (late 90s) at Evergreen State College (bastion of communism) "Neo-liberalism" referred to a suite of deregulation across trade and financial markets promulgated internationally by the Bretton Woods institutions. Broadly speaking the argument was that this would spread prosperity through specialization and foreign direct investment that would reduce prices and increase labor opportunities. Detractors argued it would be a "race to the bottom" of downward spiraling labor (teamsters) and environmental (turtles) standards. Domestically it was associated with third way Clinton/Blair politics of unraveling aspects of the welfare state. That's what I still think of us and grok with MY's frustration of its current use as an empty terminological vessel...but I feel like that is the life cycle of these terms more generally and a perennial feature of political rhetoric. The farther they spread and the more time elapses the more a term becomes a container for ones priors. The gap between rigorous thinking and generalities seems a permanent feature of our landscape.
I'm too young to remember the rhetoric of his administration, but Jimmy Carter deserves the credit for deregulating airlines, trucking, I think natural gas (not sure), and for appointing Paul Volcker (who was also a Democrat).
Growth at all costs wasn’t specific government policy. It’s been corporate policy since Friedman, at least, and neoliberalism catered to that policy. Hence dilution of antitrust regulation; multiple assaults on unions; the hamstringing of OSHA and the IRS; the refusal to raise the minimum wage and the salaried overtime levels; free trade deals that encouraged overseas manufacturing, to the destruction of communities across the country; the Social Security wage cap; tax policies regarding nonproductive financial earnings; tax policies regarding CEO pay; and many more examples, all intended to enhance corporate earnings (and thus those who manage those earnings) at the cost of the average citizen.
It makes more sense in a non-US context. This was more of a phenomenon for Europe, UK, Australia, New Zealand etc. In those countries, you did have a period of privatisation, liberalisation of labour markets, financial sector deregulation, removal of protectionism, and so on. I've never really thought it mapped that well to the US, where you already had most of those elements in place.
For what it’s worth, my left wing undergrad teaching of “the neoliberal turn” was that it was about the reduction in Labor’s power and the increasing role of Finance in achieving economic growth / “restoring profitability.”
To that end I think you are right to focus on vibes and not the level of government spending or amount of regulation.
I have never taken the Hewlett Program (I worked in the Environment Program 2012-20) to ever be anti economic growth, let alone De-growth. Economic growth was always critical to any political program. I also took the alternatives to Neoliberalism program to be more in reaction to people like James Buchanan - whose outlook was more anti-democratic - than Milton Friedman.
When I hear the term neoliberalism I think of the line “Goldman Sachs with a progress flag.” Can’t remember where I heard that, but I think it was from some online blowhard. The fact that I can’t remember if it was a left winger or right winger blowhard makes it even funnier.
Pointing out that there are people who oppose neoliberalism for dumb reasons just seems obvious to me. There will be uncritical supporters of neoliberalism as well. It's crucial for us to not conflate people supporting something for the wrong reasons with that thing itself being wrong. And I think the charge that people are unwilling to accept tradeoffs misses its mark in this post. These people do exist, but degrowthers are often times blatantly admitting to a severe (economic) tradeoff.
As for the discussion on deregulation, I think it's unfair to point to the existence of many new regulations as itself disproving the trend towards deregulation. It would make sense that there would be more laws and rules today than in the past. And it's not unreasonable to suspect that, if we had a system of governance more accepting of New Deal policies, we might have even more than we currently have. It's not just a matter of the absolute number of regulations, but also whether those regulations are keeping pace.
The move away from wage and price controls, decreased support of unions, increased resentment towards mostly mythologized welfare queens, the growing gap between worker productivity and worker compensation, increased income inequality, and significantly lowered taxes on the richest members of society all contribute solid evidence to the anti-neoliberal narrative. I'm aware you pointed out several of these factors. But it seems like your conclusion is not just "anti-neoliberals have some good points and some bad ones," but rather, more strictly negative.
Neoliberalism is vibes-compatible with the type of regulation that sets out rules any would-be operator can follow (i.e. safety, cleanliness, anti-discrimination). Less so for the type of regulation where the government enumerates the specific products and services that can be marked or "hires" specific operators to market them while prohibiting competition (i.e. taxi medallions).
Whenever I hear people gripe about "neoliberalism" I typically roll my eyes, knowing their critique is just going to be generally bad. It's worse than people critiquing capitalism because at least they have a point, even if they want to pretend that we've never tried to replace capitalism. Neoliberalism is just the post-modernist bogeyman activists use to rail against (similar to "the patriarchy" or "colonial mindset" or other similar framings).
Many good points by Matt, of course, but he might usefully cite to Gary Gerstle's book, The Rise and Fall of the Neoliberal Order. There are two missing moves to the story: "neo-liberalism" was a brainchild of progressives, who had observed that New Deal agencies had been captured by industry. Airline deregulation and trucking deregulation were products of the Carter admin and shepherded through Congress by Ted Kennedy aided by Stephen Breyer, the Judiciary Committee counsel. The efficiency claim was Kaldor-Hicks, which included not only a desire to grow the pie but also to accomplish the redistribution that would make everyone better off. Things took a pivot in the 1980s with the advent of the hostile takeover movement, the turn to shareholder value, and the generally more permissive attitude toward mergers. But many progressives (including labor) supported this as a challenge to managerial elites and in response to the massive underperformance of key areas of American business in the prior period. People bought Japanese cars because they were better. What failed was the assumption that the adjustment costs associated with a more dynamic economy would be adequately addressed and that there would genuine gain sharing from growth. People who got wealthier turned against social generosity. The decline of unionization is an important element as well. So is the change in the nature of work.
I think it should also be pointed that both LBJ and Truman(but not Kennedy) pushed the CAB to allow more competition in air travel even before Jimmy Carter.
In the early postwar era, coming out of the Great Depression and wartime planning, there was lots of skepticism (even cross-ideological skepticism) of relying on the market to organize production. The Soviet Union seemed like an economic success story. Social democratic governments sought public ownership of the commanding heights of the economy and still talked openly about an eventual end stage of common ownership of the means of production. Conservative governments didn't share the left's ideological commitments but pursued active state involvement in promoting strategic industries. Restrictions on the free movement of capital were widespread.
Everything about this is now different. The Soviet Union is now widely and correctly regarded as a massive economic failure. Social democratic governments have long hopped aboard the privatization train. Capital controls in the developed world are mostly gone. Industrial policy hasn't gone away but is much more contested. The minority of left-wing intellectuals who still talk seriously about moving beyond capitalism embrace markets within a context of some form of public or worker ownership.
Calling this shift "neoliberalism" seems right to me. And one sign of the power of the change is that even neoliberalism's modern critics accept a lot of its premises. You don't see a lot of central planning advocates anymore. Both left and right critics of neoliberalism accept the general primacy of markets in organizing production while proposing various reforms in particular areas.
One thing that has happened over the last 50 years is that income tax rates have decreased and been made less progressive. Ronald Reagan had an important role in this and it is one part of his legacy that Donald Trump has furthered. A rationale for decreasing taxes is that this would promote growth. Decreasing taxes have certainly been associated with increasing inequality
Man I'm really late on the draw on this but.....when I was in college (late 90s) at Evergreen State College (bastion of communism) "Neo-liberalism" referred to a suite of deregulation across trade and financial markets promulgated internationally by the Bretton Woods institutions. Broadly speaking the argument was that this would spread prosperity through specialization and foreign direct investment that would reduce prices and increase labor opportunities. Detractors argued it would be a "race to the bottom" of downward spiraling labor (teamsters) and environmental (turtles) standards. Domestically it was associated with third way Clinton/Blair politics of unraveling aspects of the welfare state. That's what I still think of us and grok with MY's frustration of its current use as an empty terminological vessel...but I feel like that is the life cycle of these terms more generally and a perennial feature of political rhetoric. The farther they spread and the more time elapses the more a term becomes a container for ones priors. The gap between rigorous thinking and generalities seems a permanent feature of our landscape.
I'm too young to remember the rhetoric of his administration, but Jimmy Carter deserves the credit for deregulating airlines, trucking, I think natural gas (not sure), and for appointing Paul Volcker (who was also a Democrat).
Growth at all costs wasn’t specific government policy. It’s been corporate policy since Friedman, at least, and neoliberalism catered to that policy. Hence dilution of antitrust regulation; multiple assaults on unions; the hamstringing of OSHA and the IRS; the refusal to raise the minimum wage and the salaried overtime levels; free trade deals that encouraged overseas manufacturing, to the destruction of communities across the country; the Social Security wage cap; tax policies regarding nonproductive financial earnings; tax policies regarding CEO pay; and many more examples, all intended to enhance corporate earnings (and thus those who manage those earnings) at the cost of the average citizen.
A
It makes more sense in a non-US context. This was more of a phenomenon for Europe, UK, Australia, New Zealand etc. In those countries, you did have a period of privatisation, liberalisation of labour markets, financial sector deregulation, removal of protectionism, and so on. I've never really thought it mapped that well to the US, where you already had most of those elements in place.
>denying the existence of tradeoffs tend to be popular.
One of the most important lines you've ever written, MY.
For what it’s worth, my left wing undergrad teaching of “the neoliberal turn” was that it was about the reduction in Labor’s power and the increasing role of Finance in achieving economic growth / “restoring profitability.”
To that end I think you are right to focus on vibes and not the level of government spending or amount of regulation.
I have never taken the Hewlett Program (I worked in the Environment Program 2012-20) to ever be anti economic growth, let alone De-growth. Economic growth was always critical to any political program. I also took the alternatives to Neoliberalism program to be more in reaction to people like James Buchanan - whose outlook was more anti-democratic - than Milton Friedman.
When I hear the term neoliberalism I think of the line “Goldman Sachs with a progress flag.” Can’t remember where I heard that, but I think it was from some online blowhard. The fact that I can’t remember if it was a left winger or right winger blowhard makes it even funnier.
Pointing out that there are people who oppose neoliberalism for dumb reasons just seems obvious to me. There will be uncritical supporters of neoliberalism as well. It's crucial for us to not conflate people supporting something for the wrong reasons with that thing itself being wrong. And I think the charge that people are unwilling to accept tradeoffs misses its mark in this post. These people do exist, but degrowthers are often times blatantly admitting to a severe (economic) tradeoff.
As for the discussion on deregulation, I think it's unfair to point to the existence of many new regulations as itself disproving the trend towards deregulation. It would make sense that there would be more laws and rules today than in the past. And it's not unreasonable to suspect that, if we had a system of governance more accepting of New Deal policies, we might have even more than we currently have. It's not just a matter of the absolute number of regulations, but also whether those regulations are keeping pace.
The move away from wage and price controls, decreased support of unions, increased resentment towards mostly mythologized welfare queens, the growing gap between worker productivity and worker compensation, increased income inequality, and significantly lowered taxes on the richest members of society all contribute solid evidence to the anti-neoliberal narrative. I'm aware you pointed out several of these factors. But it seems like your conclusion is not just "anti-neoliberals have some good points and some bad ones," but rather, more strictly negative.
Neoliberalism is vibes-compatible with the type of regulation that sets out rules any would-be operator can follow (i.e. safety, cleanliness, anti-discrimination). Less so for the type of regulation where the government enumerates the specific products and services that can be marked or "hires" specific operators to market them while prohibiting competition (i.e. taxi medallions).
Whenever I hear people gripe about "neoliberalism" I typically roll my eyes, knowing their critique is just going to be generally bad. It's worse than people critiquing capitalism because at least they have a point, even if they want to pretend that we've never tried to replace capitalism. Neoliberalism is just the post-modernist bogeyman activists use to rail against (similar to "the patriarchy" or "colonial mindset" or other similar framings).
This an informed and informative article discussion. come for the article stay for the comments.
Many good points by Matt, of course, but he might usefully cite to Gary Gerstle's book, The Rise and Fall of the Neoliberal Order. There are two missing moves to the story: "neo-liberalism" was a brainchild of progressives, who had observed that New Deal agencies had been captured by industry. Airline deregulation and trucking deregulation were products of the Carter admin and shepherded through Congress by Ted Kennedy aided by Stephen Breyer, the Judiciary Committee counsel. The efficiency claim was Kaldor-Hicks, which included not only a desire to grow the pie but also to accomplish the redistribution that would make everyone better off. Things took a pivot in the 1980s with the advent of the hostile takeover movement, the turn to shareholder value, and the generally more permissive attitude toward mergers. But many progressives (including labor) supported this as a challenge to managerial elites and in response to the massive underperformance of key areas of American business in the prior period. People bought Japanese cars because they were better. What failed was the assumption that the adjustment costs associated with a more dynamic economy would be adequately addressed and that there would genuine gain sharing from growth. People who got wealthier turned against social generosity. The decline of unionization is an important element as well. So is the change in the nature of work.
I think it should also be pointed that both LBJ and Truman(but not Kennedy) pushed the CAB to allow more competition in air travel even before Jimmy Carter.
In the early postwar era, coming out of the Great Depression and wartime planning, there was lots of skepticism (even cross-ideological skepticism) of relying on the market to organize production. The Soviet Union seemed like an economic success story. Social democratic governments sought public ownership of the commanding heights of the economy and still talked openly about an eventual end stage of common ownership of the means of production. Conservative governments didn't share the left's ideological commitments but pursued active state involvement in promoting strategic industries. Restrictions on the free movement of capital were widespread.
Everything about this is now different. The Soviet Union is now widely and correctly regarded as a massive economic failure. Social democratic governments have long hopped aboard the privatization train. Capital controls in the developed world are mostly gone. Industrial policy hasn't gone away but is much more contested. The minority of left-wing intellectuals who still talk seriously about moving beyond capitalism embrace markets within a context of some form of public or worker ownership.
Calling this shift "neoliberalism" seems right to me. And one sign of the power of the change is that even neoliberalism's modern critics accept a lot of its premises. You don't see a lot of central planning advocates anymore. Both left and right critics of neoliberalism accept the general primacy of markets in organizing production while proposing various reforms in particular areas.
“ The Soviet Union seemed like an economic success story.”
It was. Growth rates and standards of living rose dramatically until the mid 1960s aka the Brezhnev era.
The Soviet Union absolutely built a tremendous amount of industrial capacity.
But saying living standards rose until 1960 is a bit like saying living standards rose following the Black Death.