We should be considering the Greece and Ukraine crises together. If only the news media would allow that
Patrick L. Smith
Friday, Feb 13, 2015 03:59 AM
There is something tragically irrational driving both of these crises. The genesis of each, at least nominally, is the question of whether markets serve society or it is the other way around. Economic conflict, then, has been transformed into humanitarian disasters. This is what Greece and Ukraine have most fundamentally in common.
…Washington has so many wars going now, none declared, one can hardly keep the list current. But the most sustained and havoc-wreaking of them is unreported. This is the war for neoliberal supremacy across the planet. …
Neoliberalism is our Frankenstein. The thought holds for two reasons. At its core it is profoundly undemocratic, never mind that the English and American variants of democracy are the mulch from which it arises. It is also unrelentingly absolutist: Because it is intimately related to the myth of America’s providential exception, neoliberalism can tolerate no alternative. Were another idea of political economy to flourish it would expose premodern myth as premodern myth.
Yes, O.K., definition. Neoliberalism denotes the revival since the 1970s, plus or minus, of English liberalism as expounded by Locke in the 17th century and numerous others in the 18th—Adam Smith and his “invisible hand,” most famously. John Stuart Mill and Jeremy Bentham, the utilitarian, are notable among 19th century apostles.
Without getting tedious, there are a couple of points that need to be understood about this background. Context is all in this case.
The early English liberals stood for liberty, laissez-faire government and free trade—familiar themes today. But when they argued for the primacy of individuals and their right to autonomous economic activity they argued against divine right, the nobility’s inherited privilege, the collusion of the clerics and all else that comprised the ancien régime. Of course, these are no longer the Western world’s problems.
Point One. The 18th century liberals were pre-industrial. Their idea of the market as an expression of “the Natural Order” assumed artisanal production and the craftsman’s right to make and sell what he made freely. Classical liberalism was hugely progressive in this respect. Modern industry, to say nothing of the grotesque power and profits of modern corporations, did not figure in the thinking.
Point Two. Smith’s invisible hand has got to be one of the most misunderstood ideas in all of economics, for the simple reason most people spouting the famous Scot have never read him. They rely on social cues and Wall Street Journal editorials. Not ever did Smith and other liberals lose sight of the commonweal. The famous hand guided the pre-industrial craftsman to serve the greater community as he prospered as best he could on his own behalf. Bettering the polity was the point.
The Cold War decades, my very favorite period in American history, made a hash of all this, as with so much else. Classical liberalism in its neo phase denotes not thought but belief, ideological conviction. It is the ideology of radical deregulation, radical corporatization, radical privatization—prisons? water? kindergartens? human health?—maximal profit without regard to consequences, and the radical devaluation of any serious consciousness of the communities in which all individuals are suspended.
Reagan and Margaret “There Is No Society” Thatcher, two of the most impoverished minds to hold prominent office in the last century, gave this version of neoliberalism its global ambition. In the triumphalist 1990s, Francis Fukuyama (who still survives in the think tank set, remarkably) gave it a charlatan-scholar’s gloss: Free markets won the long war, there is no further to go in history, what we have is it.
It is very awful to watch neoliberalism spread. I say this for five reasons, if you can bear with me:
• Up close, it is ugly as it disrupts lives, dims expectations and concentrates wealth.
• So far as I have seen it unfold, not least but not only in America, it requires either that democracy is steadily diminished until it remains in form only or an elite variant of democracy is entrenched. In the best outcomes it is Hamiltonian as against Jeffersonian, fair to say.
• Ever-worsening income inequality is baked into the cake, chiefly because neoliberalism perverts ideas intended to take society in the opposite direction. This is why Thomas Piketty’s celebrated “Capital in the Twenty-First Century” comes in for so much argument, all of it flaccid: A scholar ruins the story when he demonstrates that deprivation does not turn out to be good for people at some distant time. Deprivation is what it looks like. The rest is mystification.
• Given all of the above, the neoliberal regime never arrives anywhere new without one or more of these: force, intimidation (the IMF’s function) or exponential increases in corruption. I can think of no exception to this.”