The Rumors Are False — Neoliberalism Is Alive and Well

Recent announcements of neoliberalism’s demise in the wake of the pandemic are mistaken. Ending neoliberalism will require purposeful effort and struggle, not just economic and political crises.

Ngozi Okonjo-Iweala, director general of the World Trade Organization (WTO), during an interview on the closing day of the World Economic Forum (WEF) in Davos, Switzerland, on May 26, 2022. (Hollie Adams / Getty Images)

Recent discussions about the supposed death of neoliberalism present a mirror image of past discussions about neoliberalism’s birth. For quite some time, scholars, intellectuals, and popularizers of many sorts were inclined to present neoliberalism as a mainly Anglo-American phenomenon that got its start in the late 1970s. Margaret Thatcher and Ronald Reagan have had the starring role in narratives of neoliberal politics, and Milton Friedman and Friedrich Hayek (an Austrian, but famous mainly for a career based in the United Kingdom and the United States) continue to be the best-known neoliberal intellectuals. Indeed, this group of four shared the cover of a noted history on the “birth of neoliberal politics.” Featured episodes in the history of neoliberalism elsewhere, like in Augusto Pinochet’s Chile, have still been presented in Anglo-American terms to the extent that they have been described (quite fairly) as a foreign imposition.

In some ways, these days are long gone. Hardly any serious scholar of neoliberalism would describe the ideology or its history as exclusively Anglo-American. The last decade has seen an explosion of interest in the history of neoliberalism and its practice around the globe. And yet, in ongoing discussions about the “death” of neoliberalism, we have seen a return to this limited outlook.

In 2016, a fresh round of obituaries was prompted by the election of Donald Trump in the United States and by the Brexit vote in the United Kingdom. More recently, during the early part of Joe Biden’s presidency, commentators eagerly prophesied, or even declared, neoliberalism’s demise. Sometimes their evidence consisted of little more than a progressive-but-unrealized Biden agenda. It strained credulity to imagine that, in the face of prospective legislative developments in a single country — and after forty years of never letting a crisis go to waste — the neoliberal era had finally encountered the crisis it could not survive. As if neoliberalism were incapable of withstanding American social spending provoked by the pandemic, there was a return to the original parochialism of the neoliberalism debates.

The Dynamics of Historical Change

Alongside the batch of obits since 2020, it has been commonplace to analogize the present crisis with the 1970s. In general, when these analogies are drawn, the ’70s are summarized thusly: crises including the demise of the Bretton Woods system, the oil crisis, and stagflation spelled the end of the era of postwar capitalism. The postwar arrangement had ceased to function. Neoliberal ideas just happened to be lying around — to paraphrase Milton Friedman — and thanks to certain politicians, intellectuals, and businesspeople, we wound up with a neoliberal “variant” of capitalism, which has now endured for something like forty years. This narrative gets some things right and some things wrong, but crucially, it tends to misstate the nature of the transformation. The neoliberal counterrevolution that emerged in the wake of these events was a historical process, not an overnight event.

Those sounding the death knell are thus, it would seem, naive about the dynamics of historical change amid conditions of crisis. For example, even if we restrict our view and look only at the United States, the process by which neoliberalism emerged was ad hoc and drawn out. The financialization of the American economy beginning in the 1970s, a key aspect of a broader neoliberalization, was in fact a result of policymakers’ attempts to avoid shouldering the blame for dealing with the crises they faced.

In the years that followed the supposed neoliberal break, policymakers turned to the market in order to avoid taking responsibility for distributive outcomes. The outlines of the financialized economy that emerged were not completely visible right away. And even then, the turn to the market was not entirely a historical rupture. Instead, it was a process that historian Amy Offner has described in terms of “sorting”: preserving capitalist market relations through the crises of the ’70s meant sticking with some aspects of postwar capitalism, getting rid of others, and, yes, adopting some new tools and strategies. To the extent that recent death announcements want to declare a clean break, they fail to grasp the messiness of historical development.

With the increased prevalence of oversimple glosses on the birth and death of neoliberalism, the publication of Market Civilizations, an edited collection from historian Quinn Slobodian and political scientist Dieter Plehwe, is welcome. In its treatment of “neoliberals east and south,” the book shows how neoliberalism interacts with and within other historical dynamics. Reading the various chapters, it is difficult or impossible to imagine how the end of neoliberalism can be viewed as a straightforward process.

Market Civilizations

As an intellectual project originating amid the 1930s crisis of liberalism and aimed at defending the market as a supreme mechanism of social ordering, and eventually as a state-led project of market supremacy since the 1970s, the history of neoliberalism has never been defined solely by diffusion. In other words, to use an apt phrase, neoliberalism has never been defined by the trickling down of ideas and practices from metropolitan centers to assorted peripheries. As Slobodian and Plehwe write in the introduction, neoliberalism has also in significant measure “emerge[d] autochthonously, generated from similar structural conditions and conjunctures.” Neoliberalism, as it has been practiced and thought, has been both a local and a global product.

This dual character of actually existing neoliberalism results in localized hybridization. Neoliberalism in one place is not likely to be identical to neoliberalism in another. In Turkey, for example, Esra Elif Nartok writes that a “neoliberal conception of Islam” played an important role in tailoring neoliberalism to the cultural framework of the country, thereby smoothing the way for its uptake in the 1980s. In Japan, Reto Hofmann argues, neoliberals claimed to have “found a solution to reconcile capital and community.” To the limited extent that neoliberal ideas contribute and have contributed to economic policy in India, they are combined with and active alongside other traditions. “Even where neoliberalism is not hegemonic,” writes Aditya Balasubramanian, “neoliberals can contribute to policy discourses.”

The politics of neoliberalism are also diverse. The second part of the book makes this clear with a series of chapters on neoliberalism in Russia, China, Australia, and South Africa. From a chapter in the collection by Antina von Schnitzler, take the South African case: after the Soweto uprising in 1976, in which hundreds of demonstrating students were killed by police, a political crisis of the apartheid state required urgent attention. In the various commissions set up to address the crisis, neoliberal ideas were influential in the broad effort to hold on to minority white rule while simultaneously taking steps, as one commission put it, to “give all groups a stake in the system.” This process ran up against an enduring problem for neoliberals: How can spontaneous market order be created or extended in the first place? The problem was never really solved. But in the process of attempting to deal with it, the likes of economist Jan Lombard showed how neoliberalism was a “conceptual toolkit that could be flexibly drawn on” in accordance with particular political circumstances. Neoliberalism was never a ready-made blueprint.

Selective applications of the neoliberal toolkit could even lead to a supersession of neoliberalism as such. In Brazil, there has emerged a form of “ultraliberalism” that, by selectively picking around the edges of neoliberal thought, has had the effect of making neoliberalism seem ordinary, or boring, in comparison.

The self-radicalizing ultraliberal impulse encourages the adoption of maximally extreme positions in order to score points in a social context that also values youth- and pop-culture aesthetic sensibilities to a high degree. This is not simply a description of late Bolsonarismo, but an account of a process underway since at least the mid-2000s. Why has it worked in such a way? Because, as Jimmy Casas Klausen and Paulo Chamon argue, neoliberalism “is a governing rationality overdetermined by the lines of force generated by nineteenth-century legacies of racial slavery, clientelism, heteropatriarchy, and Indigenous genocide, as well as Brazil’s location in the Global South.” In other words, because of the relationship between global and local histories.

Neoliberalism Is Dead, Long Live Neoliberalism

Concluding the book, Plehwe declares emphatically that “the history of neoliberalism is not over” and that “we can still expect more volatility and ambiguity from neoliberalism, not less.” On both counts, Plehwe is right. Neoliberalism retains its grip in terms of the logics of global capitalism and at the level of ideological “common sense,” even as that grip is threatened or pressured, even weakened, by the present crisis. But, as Market Civilizations so clearly shows, the nature of neoliberalism’s continuing existence is not everywhere and always the same. Neoliberalism is subject both to broad structural trends and to forms of local pressure that can wield those trends toward various political and economic ends.

We can expect, then, that neoliberalism will die as it has lived: variously. Structural patterns in global capitalism will exert tremendous influence over the process, in the sense that they will draw the boundaries of the possible, but they will not altogether dominate. Local conditions will play a key role in determining the nature of neoliberalism’s end or — the possibility has to be entertained — the nature of its enduring existence.

Moreover, even if neoliberalism is or is about to be dying out, we should not blindly cheerlead that process. As Slobodian and Plehwe suggest, the Brazilian case might be a “grim foreshadowing of the hybrids of neoliberal thought” to come. The end of neoliberalism may not be an inherently emancipatory development.

Neoliberalism may not go easy into that good night. But, if it does, one thing is sure, and neoliberals — who believe fundamentally in organic or spontaneous orders — will not like to hear it: the end of neoliberalism has to be actively made.