i was reading through my daily briefing on the NYT when the term “neoliberalism” came up. i know what liberal means in the political sense, and tried googling neoliberalism to get a better understanding, but the explanations didn’t make sense to me. help?
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I’ve never heard of one generally agreed upon definition, conservatives and (modern) liberals tend to use it just as a scapegoat for things they don’t like.
Neoliberalism is what conservatives think they are, yet they still use the term liberal as an insult for some reason.
> a political approach that favors free-market capitalism, deregulation, and reduction in government spending.
Essentially, neoliberalism says that the best way to manage everything is with market forces. So everything should have a market, and if a market doesn’t exist, one should be created.
Something that already has a market for example, would be cars. As more people demand cars, the cost of cars goes up, and simultaneously, car manufacturers make more cars until the supply is high enough that the cost starts to come down, at which point manufacturers make fewer cars. The “correct” number of cars is determined by the market.
Now consider something that doesn’t naturally have a market. Such as clean air. Neoliberals argue that the best way to determine how clean the air should be, is by creating a market for clean air. As an example: People who want clean air can pay companies to produce less pollution. People who don’t want clean air can choose not to pay companies to produce less pollution. Companies will then (theoretically) weigh the cost of going without payments against the reward of producing more products, and the market will determine what the “correct” amount of pollution is.
It is an argument to deregulate everything. It puts all of the power in the hands of those who can afford to participate in the market, and takes power out of the hands of elected legislators and thereby out of the hands of the voters. If you’re too poor to participate in the markets, then you have no say in how your society functions.
The word has a dictionary definition but, like a lot of -ism words these days, most speakers don’t want to be constrained by them. In other words, the meaning is less important than the feeling evoked as it gets tossed about with little regard to the actual meaning. Like “terrorism” or “racism.” Including for humor around here with the old “dat’s racist!” meme.
Edit: Just further proof that all words are made up.
Neoliberalism is the belief that “free market” economic forces can work in situations that aren’t actually markets. For example, neoliberalism in education says we shouldn’t make all taxpayers pay for public schools; we should give parents vouchers so they can choose where to send their kids and their money, and we should let the “losing” schools starve and die. In health care, neoliberalism says we should empower people to choose how to spend their money and choose the care they want, and we shouldn’t have “universal” health care because it’s “inefficient”. It originated in the “Chicago school” of economists after World War 2. In my personal opinion, it’s a well-meaning but harmful fallacy, because it overlooks the fact that people have non-monetary reasons for the things they do, like choosing to get treated for cancer or educating their children. Usually it works out fine for people who have enough money to make those choices, but it destroys the public services and safety nets that are supposed to protect the people who don’t have money.
Neoliberalism is a term that refers to the policies typified by Margaret Thatcher in the UK and Ronald Reagan in the US in the early 1980s, where government regulation was rolled back in favor of free market approaches. The overarching principle is “freedom”, which is taken to mean freedom from government intrusion on market forces (hence the “liberal”). Specific neoliberal policies include the elimination of price controls, deregulation of capital markets, lowering trade barriers like tariffs, and otherwise reducing government’s influence on the economy. There is some disagreement about how to use the term today, but that is where it began and what it referenced and the meaning today is derived from that.
Neoliberalism is just the currently existing form of capitalism. There’s a ton of complex economic theory and philosophy behind it, but all you really need to know is that it’s the current form of capitalism characterized by laissez-faire free markets, fiscal austerity, deregulation, privatization, free trade, and low taxes on the wealthy. The economic policies of Ronald Reagan and Margaret Thatcher were neoliberalism on steroids, but most mainstream political parties on the left and right in just about every country embrace neoliberism.
For much of the 19th and early 20th centuries, many countries pursued laissez-faire economic policies, in which they largely allowed businesses to govern themselves, set low tax rates and generally avoided interfering in the economy. This resulted in an era of unprecedented prosperity for the wealthy, even if ordinary people didn’t see many of the benefits. In those days, laissez-faire economics was associated with the term “liberalism”, and it still is in most places outside the US.
Then came the Great Depression, in which many countries went through a period of extreme economic devastation, placing pressure on governments to intervene. This was quickly followed by the Second World War, in which most of the world’s great powers faced existential military threats and their governments took unprecedented control over their economies in order to focus everything on the war effort. For some time after the war, governments continued to intervene significantly in their economies and to some extent prevented the wealthy from accumulating more and more wealth, resulting in a period of relative equality.
But then came a resurgence in laissez-faire economics, initially led by people such as Pinochet, Thatcher and Reagan, but ultimately coming to dominate politics around the world. This new wave of economic liberalism is called neoliberalism, and it differs from the previous wave in various respects. Many people have written many things about it, but it’s a little hard to pin down its exact nature because it’s still ongoing and developing. This means it’s hard to distance ourselves from it, and we don’t know where it’s going to end up. This has resulted in neoliberalism becoming quite a controversial term that’s more associated with critics of the current economic order than its defenders, who tend to regard it as a natural and inevitable state of affairs rather than just another ideology.
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