Neoliberalism is being challenged
Don’t know about you, but I think neoliberalism, which has been a prevailing ideology for the past 40 years, is being challenged this year like never before.
Let me start my argument with a discussion of the newest AltBanking essay, entitled Freedom in the Neoliberal Eden. In the essay, we make the case that the citizens of Flint, Michigan and Ferguson, Missouri are living lives of extreme freedom and liberty, at least if you define those concepts as a neoliberalist would. They are extreme cases, to be sure, but also 100% natural consequences of their political and economic environment. From the essay:
When nothing trickles down, when boats don’t rise, here is the explanation that follows: it is not the system that it is at fault, but the character of those people who failed to prosper in it. In this supposedly radically free landscape, you will find yourself entwined in an unsatisfiable obligation. Yes, there is the ever-present Prosperity Gospel stuff we hear from the Christian right, but there is also an even wider-scale acceptance of financial responsibility, credit worthiness, and general economic success – whether earned or not – as equivalent to moral uprightness.
Feel free to read the entire essay, which is powerful.
It’s also not entirely pessimistic. It ends with the hopeful thought that the Ferguson Report was, after all, generated by our Justice Department. Perhaps it can or will be seen as an inflection point in the history of neoliberal politics in the U.S..
In fact, there are more hopeful signs if you look for them.
For example, yet another attempt at social impact bonds, which is a way to hand huge social problems over to “the private sector” to solve, has failed. I’ve written about this before as a bad idea, so I won’t go into all my reasons that Goldman Sachs won’t solve mass incarceration (key word: gaming).
More generally though, we shouldn’t expect a neoliberalized private sector economy to address problems that stem from inequality. If you find yourself trying to financialize things like incarcerated teens and early childhood education for poor kids, you’re likely not going to see the point of long-term investments like GED preparation classes for prisoners, which cost money now but have few easily measurable benefits.
Simply stated, there are some things that government should actually provide to everyone, like education and economic opportunity, where private companies will always want to pick and choose who will be more profitable. I think this is sinking in, slowly.
Here’s another spark of hope: politics. I know, it’s hard to find much inspiration in that chaos, but one obvious point to make is that voters are not entirely buying into the standard SuperPAC-funded corporatist politics. Granted, it’s taking an ugly turn on the GOP side, but it’s interesting nonetheless. And since I’m looking for good news, I’ll consider this as such.
Finally, the recent Congressional action that removed No Child Left Behind is a concession from policy makers that educational institutions do not benefit from being run like businesses, and naive metrics of success when it comes to truly difficult problems only serve to distract and trivialize.
In his new book The Only Game In Town, Mohamed El-Erian describes two possible near futures for the world economy: in the first, we go to hell in a hand basket characterized by economic stagnation, radicalized politics and social unrest, destructive inequality, and resource wars between nations.
In the second possible future, the elected governments of the world acknowledge the major roles they play in a peaceful future. They pick themselves up off their collective asses, take their responsibilities seriously – and in particular take the economic reins from central bankers – and start providing the services, infrastructure, progressive tax systems, and opportunities that their constituents need.
I’m hoping the second thing happens.