Neoliberalism is the word most frequently used by commentators and academics when discussing the changes in the US economy over the past 50 years. For most people, this is a completely useless term. Are we talking about some new form of the New Deal? Then, we must yank ourselves back to 19th-century European liberalism to discover what neo is. Then, we are thrust into a very small world of political thinking that emerges chiefly from the works of Friedrich Hayek, Milton Friedman, and others….. Here is my summary of neoliberal thinking today:
- free markets– the ideal for economic activity
- success or failure is in each person’s hands; every person is in their own boat
- minimal government– low taxes and spending
- privatization of government activities – education, healthcare, prisons, transportation, and water, to name a few
- deregulation – limit government to private property protections, contract enforcement, national defense, etc.
- deregulate business, especially anti-trust and finance. End environmental laws, decrease support for unions, reduce tax law enforcement
- financialization- the only purpose of a business is to increase share price and shift to the extraction of money instead of the creation of real products and services
- free trade– no tariffs, free flows of money
- globalization– maximizing each country’s competitive advantages – enforce property rights
- economic growth and innovation originates in the market economy – government plays no positive role
How did these become the central economic policy dogma of the last 60 years?
This question is addressed in David Gibbs, Revolt of the Rich: How the Politics of the 1970s Widened America’s Class Divide (New York: Columbia University Press, 2024). It is the political strategies of American conservatives in the Republican Party that put these ideas into action. They combined this free-market thinking with their talent for using long-standing American political and cultural themes to put them into action. American conservatives mobilized their supporters through the tried and true appeals to racial hatred, fears of immigrants, white nationalism, and the rest of the appeals to the fears of a broad segment of the American public. Gibbs details how this movement used large-scale financial support from America’s rich to change the very terms in which we discussed how the economy and government should work. They created think tanks, business schools, college and high school curricula. They enrolled mass media to carry engage the public.
The book provides many intriguing details about the many sides of this story and very successfully describes how this occurred. It is a very persuasive history of what I have come to call the most successful social movement of the past 100 years, Wealth Supremacy: the revolt of the rich and the shift of enormous income and wealth to a very tiny fraction of the population. This was accompanied by the intensification of insecurities about jobs, housing, family life, education, healthcare, and more for the bottom 90%.