Toward a Meaningful Neo-Liberalism: A Historical Narrative

As a general rule of intellectual honesty, one should try to describe one’s opponents using their language as opposed to using loaded straw man language. This is an extension of the Ideological Turing Test. Can you describe a viewpoint you oppose without it being obvious you oppose it? For this reason, it is, in practice, counter-productive to call people racist or anti-Semitic unless they already embrace those labels for themselves. An extreme example of this problem with labeling is the term “neoliberalism.” While you can fill a library with books on neoliberalism, I know of no neoliberal thinker, someone who self-consciously embraces the label for themselves instead of using it as an epithet against others. Contrast neoliberal with neoconservative. Neoconservatism may have taken a hit with the failure of the Iraq War (which is part of the reason why I abandoned the system) but there still remain proud neoconservatives.

One of the reasons, one needs to stick to what people openly proclaim about themselves is that, without that grounding, it is all too easy to fall prey to conspiracy theories that say more about you than your opponent. Nancy Maclean is the perfect example of this. Her search for a secret agenda makes her incapable of engaging with the thought of the late James Buchanan specifically or of Public Choice in general. Instead, she falls prey to conspiratorial thinking that sounds delusional to anyone not already convinced of the existence of a Koch Brothers plot to take over the world.

This is not a unique problem for people on the left. Consider the state of conservative discourse on Marxism. In the case of Marxism, we are dealing with a concept that continues to attract open self-proclaimed, followers. Furthermore, Marxism, by its very nature, is a conspiracy. More so than any other political ideology, Marxism is not simply a set of beliefs but a methodology for seizing power. Furthermore, Marxists pursue the dishonest strategy of framing their position in terms of their noble intentions as opposed to what they may have to do to bring about those ends. Despite all this being true, it is usually counter-productive to accuse people of being part of a Marxist conspiracy. (For one thing, not all Marxists are conspirators; many are not even political.) Such anti-Marxist thinking will usually backfire on the accusor, trapping them in paranoid delusions. Personally, I think Jordan Peterson is great until he starts talking about Cultural Marxism and equating it with post-modernism. The moment he does this, he stops engaging living people but his own fears. He should stick to Jungian literary analysis and preaching personal responsibility.

I would like to suggest a means to rescue neoliberalism from being a generic conspiratorial term of abuse for those not sufficiently on the hard left. We can use neoliberalism to refer to the political consensus that arose in the 1970s in England and the United States that combined a pro-business skepticism in regard to heavy welfare spending with a warfare mentality abroad and at home.  Underlying this was a cultural Christianity even as the shifts in society made openly theocratic politics implausible.

The key thinker here was William F. Buckley, the founder of National Review, who fashioned late 20th-century conservatism as an alliance between social conservatives, neoconservatives, and limited government free marketers. Getting such different groups to cooperate was possible because all three groups had a perceived common enemy in the 1960s liberal, who wished to use an expansive state to overthrow traditional values and undermine the United States military in order to allow the Soviet Union to win the Cold War. It was this brand of conservativism that defeated the post-war liberal consensus and fashioned a neoliberal consensus in its place.

The United States and England, after the Great Depression and World War II, were dominated by a "New Deal" consensus in which it was assumed the government would take on a greatly expanded role in running the economy and offer a wider range of welfare programs. In England, national healthcare was seen as a reward to the English people for the sacrifices they underwent fighting Nazism. Even if Churchill had been able to stave off the 1945 Labor landslide, there was no way that conservatives could have resisted the popular tide to offer a major state-sponsored safety net.

This did not mean that voters in either country rejected right-wing parties. One of the marks of a political consensus is its ability to draw in even the opposition to the point where, even as they criticize particular points of policy, they accept the fundamental premises behind those policies. This serves the ironic purpose of establishing the consensus as it makes it almost impossible to think outside of it. The Republicans in the United States under Dwight Eisenhower did very well for themselves. That being said, Eisenhower helped entrench the New Deal, perhaps with a more corporate spin. In England, Conservative prime ministers like Harold Macmillan or Ted Heath could succeed by being innocuous managers of the ship of state. Neither of them were ideologues with a vision to counter that of the Labor Party. As such, whether Labor won or lost, it was still Labor's agenda that was going to dominate; the only question conservatives were left with was to what extent specific Labor policies would be implemented.

This post-war consensus in the United States and England was made possible by strong working-class support. This collapsed in the late 1960s and 70s. In the United States, we see white disillusionment with the Civil Rights movement. The parallel for England, perhaps, was the end of the British Empire, which had the ironic result of England bringing the empire home with its liberal immigration policy for those from the former imperial holdings. This undermined a sense of common ethnic identity so important for consensus building. Both the United States and England faced the problem of transitioning to a post-industrial economy. As long as both countries benefited from the post-war economic boom and the optimistic belief that things were improving it was possible to paper over the differences in society, making compromise possible. A growing tax base would be able to pay for an expanding list of programs either in the present or at least in the near future. Without the economic boom and the optimism that it usually generates, such compromise became impossible as politics was reduced to a collection of tribes fighting over the remnants of a shrinking pie, each side trying to grab their piece before it was all gone.

Into this gap left by the failed post-war consensus came neoliberalism as represented by Margaret Thatcher and Ronald Reagan. Unlike their Conservative and Republican predecessors, they actually had an ideology. Limiting government spending in the name of free markets served a practical purpose under the economic challenges of the 1970s. It also helped frame neoliberal policies as advancing the cause of freedom through limiting government. It is important to realize that neoliberalism was a product of a wider liberal consensus and, unlike traditional conservatism, was not about to take any kind of principled stand in favor of hierarchy.

Much as neoliberalism was not a defense of any kind of crown, it also rejected the altar of religious authority. As Victorian morality was an attempt to find a justification for religion in a world with Darwinian Evolution and Biblical Criticism, Neoliberalism was a product of the secularization of the public sphere and an acceptance of that reality. Neoliberalism still wished to fight a rearguard action to save religion as a cultural force. Beyond that, religion served to cement the 1960s liberal as the enemy trying to shove secularism down the throats of common folk. Abortion is a good example of this. Making abortion illegal was never a practical goal. Roe vs. Wade was the product of a growing wave to legalize abortion (ironically enough, helped along by then Gov. Reagan of California) even as the Supreme Court's decision counter-productively short-circuited the national conversation. The Court's ham-handed approach gifted neoliberals by allowing them to campaign less against abortion itself than against Roe. The real story of Roe became liberals trying to force their values on the rest of society as opposed to a woman's right to choose.   

From the earlier liberal post-war consensus and ultimately the Wilsonian tradition, neoliberalism inherited an activist foreign policy in the name of advancing democracy. Thatcher famously fought the Falklands War in 1982 to hold on to one of the last vestiges of the British Empire even as it served little purpose beyond taking a final stand in the name of the Empire. What was different now was that this foreign policy was meant to be pursued in defiance of the hard left who rejected the Western tradition, seeing it as the source of imperialism and racism. Neoliberalism was meant as a war to be fought at home as well as abroad. One manifestation of this was the War on Drugs, which served to establish active drug users (in practice those on the left) as the enemy and gave the police the tools to wage actual war against this enemy.

Up until now, my description of neoliberalism has simply been late 20th-century Anglo-American conservatism. Here is the twist; just as the post-war consensus did not keep conservative parties out of office as long as they were willing to play the moderate pragmatists to the dominant liberal ideology, neoliberalism offered a temptation to liberals to gain electoral victory as the moderate pragmatists, cementing neoliberalism as the reigning ideology. From this perspective, a critical part of neoliberalism was the rise of Bill Clinton and Tony Blair. They were not a rejection of neoliberalism but the epitome of its power.

Both of these politicians criticized Reagan and Thatcher but from within a certain consensus. So conservatives were to be criticized for running up deficits to support tax cuts for the wealthy. Gone was the romantic notion of a welfare state that could transform society. In its place was an accountant's pragmaticism of getting the maximal utility for the taxpayer's money. Clinton was willing to fight for abortion but he did so from within a consensus that still paid religion cultural deference. Most infamously, he signed the Defence of Marriage Act. Clinton's foreign policy was a continuation of a neoliberal desire to see the United States as the global defender of freedom now being practiced without the Soviet Union as an excuse. Bush's Iraq Invasion in search of weapons of mass destruction was simply an extension of Clinton's use of the American military in a post-9/11 world. It was Blair who was Bush's most important ally in invading Iraq.

Just as the post-war consensus benefited from the post-war economic boom, which granted legitimacy to the dominant government policies, neoliberalism benefited from the computer and internet revolutions of the 1990s. How does one argue with policies that seem to work and seem to be creating a rising tide that should raise all boats? Just as the economic stagnation of the 1970s made the post-war consensus appear suddenly vulnerable, the economic crisis of 2008 made neoliberalism suddenly appear as the emperor with no clothes. The political fallout was slow in coming as the political class remained under its spell long after the general public. Barack Obama came from the same mold of pragmatic neoliberalism as the Clintons. Thus, he framed his policies in anti-Republican terms, ignoring the wider neo-liberal framework.

Donald Trump brought down Republican neoliberalism by demonstrating it lacked a real basis of ideological support. Similarly, David Cameron was brought down by Brexit, which demonstrated that his own Conservative Party base did not support the relatively free-trade and open-border policies of the European Union. Once neoliberalism fell as an ideology within conservative circles, there was no longer a reason for liberals to play pragmatic lip service to neoliberalism either. Hence the rise of Bernie Sanders and Alexandria Ocasio-Cortez in the United States and Jeremy Corbyn in England.

In the wake of the fall of neoliberalism, Anglo-American politics seems to be turning into a conflict between nationalists and democratic socialists. What the new dominant consensus will be remains to be seen. I suspect that it will be some version of a blatantly extractive state that attempts to bribe its voters with the right and the left simply disagreeing on who should be expropriated and for whose benefit.

From this proposed definition of neoliberalism and this history offered a few things should be clear. I discuss neoliberalism within an Anglo-American context, though I confess that I might be stretching things even to include England. How much more problematic to include other countries. I readily grant that one could draw parallels between Anglo-American neoliberalism and policies in other countries. Those who are more knowledgeable than I am regarding non-Anglo-American politics should feel free to make those comparisons as long as they show proper caution. The more you stretch a term, the greater the risk of either distorting the reality on the ground or rendering the word meaningless. One thinks of the problem of talking about "feudal" Japan. Yes, there are certain parallels to Europe but it is risky to push those comparisons too far. Similarly, I do not think it is productive to call authoritarian figures like Augusto Pinochet of Chile or Deng Xiaoping of China neoliberals. Doing so risks distorting the differences between these countries and descending into conspiratorial thinking where Anglo-American neoliberals not only become people plotting to violently undermine democratic norms but also have Elders of Zion capabilities to rule the world.

Even within Anglo-American politics, notice the number of people who should be placed outside of neoliberalism. While Milton Friedman and Friedrich Hayek were influential figures in the rise of neoliberalism, one should not make a direct link between neoliberalism and libertarianism. Here, the War on Drugs is important. Nor should one equate neoliberalism with neo-confederates or white nationalism. On the contrary, neoliberalism grew out of a world in which open white nationalism was no longer politically viable and its fall has opened that door once again.

Because I have limited the scope of neoliberalism in time and place it appears much less all-powerful and sinister. Neoliberalism was a political ideology espoused by specific people in a specific time and place with a variety of policy positions some of which may or may not appeal to readers. My teenage self was more supportive of this kind of neoliberalism than I am now. That being said, the fact that whatever is going to replace neoliberalism is likely to be worse, I do confess to being nostalgic for neoliberalism.