After neoliberalism: a snippet

“The other is to appeal to the positive elements of the appeal of tribalism, such as solidarity and affection for long-standing institutions”

My only worry with that is the strong overlap between tribalism and racism, at least in it’s political forms. Harking to the myth of a monocultural past could be seen by some as ‘affection for long-standing institutions’. (I know that’s not what the author is thinking, but left has had it’s racism and pro-discrimination elements, and I am wary of giving too much opportunity for those to align with that of the right)

I wonder, how do you envision this failure of neoliberalism?

It seems like an effective response would depend somewhat on how you think this anticipated political failure of neoliberalism plays out over the next few years. And, it is an anticipated failure, yes? or do you see an actual political failure as an accomplished fact?

And, if it is still an anticipated failure, do you see it as a political failure — the inability to marshall electoral support or a legislative coalition? Or, an ideological style that’s worn out its credibility?

Or, do you anticipate manifest policy failure to play a role in the dynamics?

This analysis by Quiggin is spot on. Clearly the way forward holds both promise and great peril, especially in the nuclear age. The notion that Trump is just more of the same from the GOP is deluded. He represents a dangerous insurgency of radical rightists , who can be quite fairly be called racist and religious extremist based fascists. A Trump win could well close the curtain on democracy in America. Neo liberalism is being repudiated , will the elite now turn to the fascists to hold their ground, as happened in Germany? It’s a troubling question.

4: From my point of view, neoliberalism…long supply chains and logistics; downward pressure on wages and the social wage; the growth of finance to supply consumer credit to prop up effective demand; the culture of self-improvement and self-management to reduce overhead and reproduction costs…no longer supports accumulation of capital or reproduction of political legitimacy. IOW, an economic failure.

(Anwar Shaikh’s new book is definitive)

Is there any knowledge of who supports tribalism? The analysis so far seems to be in terms of tribalist policies, emotions etc, but not of who the tribalists are, and why they support tribalist ‘solutions’ rather than say socialism.

Tribalism is hard wired in our genes. It can be over come with education but too few voters ever get beyond an emotional response to what they perceive. It’s no accident that conservatives do anything they can to undermine education and promote religious based ignorance. That’s how they win elections. But this is a dangerous game, sometimes a Hitler or a Trump shows up and steals the show.

Bob Zanelli @ 10, your comment perfectly embodies an ideological trap to be avoided at all costs. What Quiggin calls tribalism is precisely not “hard-wired in our genes”, it’s an inherently modern creation of the inherently modern political and economic forces that first created the “imagined community” of the modern nation-state and continue to put incredible amounts of energy into indoctrinating various populations in its various national mythologies. Far from being an inherent solution to this problem, education — within the context of a national education system, educating its pupils as Americans/Australians/etc. — is an utterly indispensable mechanism by which this process is accomplished.

Bravo, Will G-R!

The question of what ideology an ideologically coherent left-oriented force would come together around is indeed an important question, but I’ll try not to dwell on my hobbyhorses too much.

For now I’ll add a slightly different area to consider this through: current First World “left” populations (especially in the U.S.) want to turn everything into individual moral questions through which a false solidarity can be expressed and through which opposing people can be shamed. For instance, I’ve thought a good deal about how environmental problems are the most important problems in general at the moment, and how it’s clear that they require a redesign of our infrastructure. This is not an individual problem — no amount of volunteer action will work. Yet people on the left continually exert pressure to turn this into a conflict of morally good renouncers vs wasters, something that the right is quite ready to enhance with their own ridiculous tribal boundary markers (google “rolling coal”).

You see this with appeals to racism. Racism is a real problem and destroys real people’s lives. But treating it as an individual moral problem rather than a social, structural one is a way of setting boundaries around an elite. The challenge for the left is going to be developing a left that, no matter what it’s based around, doesn’t fall back into this individualist new-class status preservation.

@ comment 16:

I can’t speak for other industrialized democracies, but in the US, there is essentially no ability for the left to engage in structural change. Every avenue has been either blocked by the 18th century political structures of the US (sometimes exploited in extraordinary ways by the monied powers that those structures enable) or subsumed by the neoliberal individualist marketification of everything.

So what remains, especially given the latter, is marketing and individual action — persuasion, shame, public expressions of virtue. That’s all that is available to the left in the United States, especially on issues like racism and environmental problems.

So while it’s good fun to bash the lefty elites in their tony coastal enclaves and recount their clueless dinner party conversations, it’s shooting fish in a barrel. Easy for you and probably satisfying in a cheap way, but the fish probably didn’t put themselves in the barrel, and blaming them for swimming in circles is… problematic.

“Easy for you and probably satisfying in a cheap way, but the fish probably didn’t put themselves in the barrel, and blaming them for swimming in circles is… problematic.”

I come out of the same milieu, so I don’t see why it’s problematic to call attention to this. I
helped to change JQ’s opinion on part of it (as he wrote later, the facts were the largest influence on his change of opinion, but apparently what I wrote helped) and he’s an actual public intellectual in Australia. As intellectuals our personal actions don’t matter but sometimes our ideas might.

Activism and social movements can help, even in the U.S. (I think that 350.org has had a measurable effect) so I wouldn’t say that a structural approach means that nothing is possible.

Like Will G-R at 17 and Bob Zannelli at 19, I, too, found the use of the term “tribalism” in the original post a bit disturbing. It’s almost always used as a pejorative. And it suggests that the “tribalists” require no deeper analysis. I’m sure it’s been around for much longer, but I think I first took note of it when the Scottish National Party was shallowly dismissed as a mere expression of tribalism. That the SNP (which, by the way, I do not support) was raising questions about the deep failures of the British system of politics and government long before these failures became widely acknowledged was thus disregarded. Currently, an aspect of that deep failure, the British Labour Party seems to be in the process of destroying itself, again in part, in my estimation, because one side, among whom the ‘experts’ must be numbered, seem to think that those who are challenging them can be dismissed as “tribalists.” There are surely a lot more examples.

More generally, the resort to “tribalism” as an explanation of what is now transpiring is also, perhaps, neoliberalism’s misunderstanding of its own present predicaments even while it is part of the arsenal of weapons neoliberals direct against their critics?

But in short, the evocation of “tribalism” is not only disturbing, it’s dangerously misleading. Those seeking to understand what may now be unfolding should avoid using it, not least because there are also almost certainly a whole lot of different “tribes.”

This just in, about good tribalism (locality-based) vs bad tribalism (“race”-based, ie perceived or assumed common ancestry). It’s about cultural recognition; nationalism, based on shared allegiance to a power structure, is different, although related (sadly)

RobinM, to clarify, I do think that what Quiggin calls tribalism is worth opposing in pretty absolute terms, and I even largely agree with the meat of his broader “three-party system” analysis. I just think we should call what he calls “tribalism” by its proper name — fascism — instead of deliberately tainting our theories with overtones of an “enlightened civilized wisdom versus backwards tribal savages” narrative that itself is central to fascist/”tribalist” ideology and therefore belongs in the dustbin of history. Surely flouting Godwin’s Law is a lesser sin than knowingly perpetuating the discourses of racism.

Bob Zannelli @27

“about Marxism is that it’s pseudo science and
it gave us Stalin , the failed Soviet Union, Pol Pot,, Mao Tse Tung and the dear leader in North Korea to name the most obvious.”

To claim that Marxism ‘gave us’ all those wicked people must be one of the least Marxist statements ever written! No doubt if Stalin and Pol Pot hadn’t come across the works of a 19th century German émigré then they would have had jobs working in a florists and spending all the rest of their time helping old ladies over the road.

Good to see Bob being consistent though. A few comments back he was suggesting that humans are biologically ‘tribalist’, but now he’s blaming all evil on political ideology.

‘Tribalism’ is giving members of what you perceive as your tribe more leeway than you give others. (Or negatively being much more critical of others than you would be of your tribe). It seems pretty hardwired, at least enough that not planning around it would be foolish. Lots of ‘civilization’ is about lubricating the rough spots created by tribalism while trying to leverage the good sides.

One of the failures of neo-liberalism is in assuming that it can count on the good side of tribalism while ignoring the perceived responsibilities to one’s own tribe. It turns out that you can’t say things like “globalism is great for the UK GDP” and expect citizens of the ‘UK’ to be excited about it if they feel too alienated from the people who are making all of the money. So then when it comes time to say “for the good of the UK we need you to do X” lots of people won’t listen to you. John asks a good question in exploring what comes next, but it isn’t clear.

@ Sebastian_H: It seems pretty hardwired, at least enough that not planning around it would be foolish.

But again, when we’re talking about “tribalism” not in terms of some vague quasi-sociobiological force of eternal undying human nature, but in terms of the very modern historical phenomena of racism and nationalism, we have to consider the way any well-functioning modern nation-state has a whole host of institutions devoted to indoctrinating citizens in whatever ideological mythology is supposed to underpin a shared sense of national and/or racial identity. It should go without saying that whatever we think about general ingroup/outgroup tendencies innately hardwired into human nature or whatever, this way of relating our identities to historically contingent social institutions and their symbols is only as innate or hardwired as the institutions themselves.

It turns out that you can’t say things like “globalism is great for the UK GDP” and expect citizens of the ‘UK’ to be excited about it if they feel too alienated from the people who are making all of the money.

At least in my view, economists are usually slipperier than that. The arguments I’ve seen for neoliberal free trade (I’m not quite sure what to make of the term “globalism”) generally involve it being good for “the economy” in a much more abstract sense, carefully worded to avoid specifying whether the growth and prosperity takes place in Manchester or Mumbai. And there’s even something worth preserving in this tendency, in the sense that ideally the workers of the world would have no less international/interracial solidarity than global capital already seems to achieved.

To me the possibility that neoliberal free trade and its degradation of national sovereignty might ultimately undermine the effectiveness of all nationalist myths, forging a sense of global solidarity among the collective masses of humanity ground under capital’s boot, is the greatest hope or maybe even the only real hope we have in the face of the neoliberal onslaught. Certainly if there’s any lesson from the fact that the hardest-neoliberal political leaders are often simultaneously the greatest supporters or enablers of chauvinistic ethnonationalism, it’s that this kind of solidarity is also one of global capital’s greatest nightmares.

Recommending Joshua Clover’s new book. Riot -Strike – Riot Prime

The strike, the organized disruption at the point of production, is no longer really available. Late capitalism, neoliberalism is now extracting surplus from distribution, as it did before industrialism, and is at the transport and communication streams that disruption will occur. And this will be riot, and there won’t be much organization, centralization, hierarchy or solidarity. I am ok with “tribalism” although still looking for a better expression, and recognizing that a tribe is 15-50 people, and absolutely not scalable. Tribes can network, and people can have multiple and transient affiliations.

Clover’s model is the Paris Commune.

(PS: If you don’t like “tribe” come up with a word or expression that usefully describes the sociality of Black Lives Matter (movement, maybe) or even better Crooked Timber.)

And also of course, people looking at Trump and his followers (or their enemies and opponents in the Democratic Party) and seeing “tribalism” are simply modernists engaging in nostalgia and reactionary analysis.

Trumpism is not fascism, and a Trump Rally is not Nuremberg. Much closer to Carnival

Wiki: “Interpretations of Carnival present it as a social institution that degrades or “uncrowns” the higher functions of thought, speech, and the soul by translating them into the grotesque body, which serves to renew society and the world,[37] as a release for impulses that threaten the social order that ultimately reinforces social norms,[38] as a social transformation[39] or as a tool for different groups to focus attention on conflicts and incongruities by embodying them in “senseless” acts.”

…or riot.

“Tribalism” feeds into the factionalism of parties. The left has a strong faction both inside the ALP and the Liberal Party. The Right faction, in the NLP, is currently in ascendancy but this will not last. Just as the Right faction (in the ALP) was sidelined by clever ALP faction battles, the current members of the NLP’s Right faction are on borrowed time. But all politicians are “mugs” as Henry Lawson pointed out over a hundred years ago. Politicians can be talked into anything, if it gives them an illusion of power. So “tribalism” is more powerful than “factionalism” simply because it has more staying power. Left faction and Right faction merely obey the demands of their tribal masters.

I take note of the Florida primary results, just in: Debbie Wasserman-Schultz did just fine, as did her hand-picked Democratic Senate candidate, the horrible Patrick Murphy.

Oh, and Rubio is back.

Notice of the death of neoliberalism might be premature.

@ Bob Zannelli 10: To describe something as “hard wired” is to give up: what course of action could we take? But, then, why isn’t everyone a member of the tribalist party? Has everyone, always, been of the tribalist party? (I know someone could argue, ‘everyone is racist’ or ‘all these white liberals are just as racist really’, but even if that is somehow true, most are members of the socialist party or the neoliberal party).

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I don’t think I advocated giving up, I suggested we need to understand. You can be damn sure the purveyors of right wing agitprop understand human nature and are very good at getting people to vote against their own self interest.

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Rather than deciding it is all too hard, we can at least find out who supports tribalism, why it makes sense to them, whether it benefits them, how it benefits them, if it does, and why they support it anyway, if it does not benefit them.

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I agree completely

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I suppose (I am guessing here), some tribalists are benefiting from differential government support, such as immigration policies that keep out rival potential employees, or tariff policies that keep out competitors; or at least, that they used to benefit like that. But Crooked Timber should have readers who can answer this kind of question from their expertise.

Collect the evidence, then understand, then act.

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Exactly. That’s why the right works so hard at dividing people along lines of race, gender , sexual orientation and so on , but never class.

I should acknowledge that racism may not be so significant in some of the other right wing minor parties such as Family First.

I suppose it’s too late to try to convince people here that the term “neoliberalism” is a virus that devastates the analytic functions of the brain, but I’ll try. The term is based on a European use of the word “liberal” that has never had any currency in the US. It’s a wholly pejorative term based on a misunderstanding of Hayek (who did *not* believe in laissez-faire), but may be a reasonable approximation of the beliefs of , say, Thatcher. Then that term was confounded with a totally unconnected term invented by Peters, who was using the word “liberal” in the American sense. And presto, we have a seamless worlwide philosophy with “hard” and “soft” variants.

As far as, say, H. Clinton is concerned, I can see no respect in which it would be wrong to describe her as just a “liberal” in the American sense. American liberalism has always been internationalist and mildly pro-free-trade. It’s also been pro-union– so we can just say that’s *soft* neoliberalism and preserve our sense that we are part of a world-wide struggle. Or not.

Bernie Sanders was celebrated by the left for supporting a tax on carbon (without mentioning, of course, what price of gasoline he was contemplating), but this is an excellent illustration of what Peters would have considered a neoliberal policy. The term now just seems to mean anything I don’t like.

As for Benedict Arnold, I mean Judas Iscariot, I mean Bill Clinton, you can make a case that he did his best to salvage something from the wreckage. To repeat what I’ve said here before, when he was elected the Democrats had lost five of the last six elections, most by landslides. The one exception was the most conservative of the Democratic candidates, who was despised by the left. The American people had decisively rejected what the Democrats were selling. False consciousness, no doubt.

So rather than spending a lot of time celebrating victory over this hegemonic ideology, perhaps people should be talking about liberalism and whatever we’re calling the left alternative to it.

An analysis of infinite greed and its devastating world wide cultural consequences.
http://www.the-tls.co.uk/articles/public/hidden-costs

Broad definitions:

neoliberalism: X is a good idea because it will solve your problem, in a way I can explain if you have 300+ hours spare.

tribalism: X is a good idea because group Y hate it.

They are mostly communication styles; you could make some kind of neoliberal case for building a wall between the US and Mexico. It just wouldn’t be a strong one because a large proportion of the people who spent 300 hours looking at the issue would disagree.

It works much better as a tribally-justified policy: 99% of people can correctly predict, without having to pause for thought, that Mexicans would hate having to pay for a wall.

The problem with neoliberalism is that it isn’t really compatible with a modern free market economy. Simply because that system isn’t well enough understood to allow experts, let alone informed amateurs, to reach a consensus on what a particular change will actually do.

‘Take back control’ was the slogan that won Brexit. It is the inability of the neoliberal communication style to credibly promise control that lost it.

If we’re really looking for a general word that works across national boundaries, it’s a well-used one: conservatism. People sometimes object that conservatives in one country are not the same as conservatives in another country, but really the differences are not much greater than in liberalism across countries, socialism, etc. Conservatism includes the characteristics of authoritarianism and nationalism. U.S. “tribalism” is its local manifestation: the use of “tribalism” to denote a global style of conservatism denotes a particular, contemporary type of conservatism, just as neoliberalism is a type of liberalism. You could divide JQ’s three groups into left, liberal, conservative but since you’re using neoliberal as the middle one (e.g. a contemporary mode) then “tribalism” or something like it seems appropriate for the last.

Note that there is no word for a contemporary mode of leftism, because there isn’t one. The closest is the acephalous or consensus style of many recent movements and groups, but that mode hasn’t won elections or taken power.

Probably simplest and least ambiguous language is just to name policy justification strategies after typical politicians who use them. So:

Clintonism: X is a good idea because it will adjust market conditions in a way that will solve your problem. I can explain if you have 300+ hours spare…

Trumpism: X is a good idea because minorities and cosmopolitan intellectuals hate it.

Putinism: X is a good idea because I can have you killed.

Apart from the obvious advantages “fascism” brings to the table — the sense of describing “Trumpism” in terms of what it seeks to develop into and not in terms of its current and clearly underdeveloped form, as well as the sense of tying our current state of poorly grasped ideological confusion back to WWII as the last clear three-way “battlefield of ideologies” pitting liberalism against fascism against socialism — the term is broadly symbolically appropriate for the same reasons it was originally adopted by Mussolini. The sense of national solidarity and “strength through unity” (i.e. the socialist element of National Socialism) is exactly what John Quiggin is characterizing as “the positive elements of the appeal of tribalism”, and the direct invocation of the Roman fasces as a symbol of pure authority is exactly what Z is getting at with the term “archism”. Sure our latter-day manifestation of fascism hasn’t (yet) led to an honest-to-God fascist regime in any Western country, but to kid ourselves that this isn’t what it seeks or that it couldn’t potentially get there would be, well, a bit too uncomfortably Weimar-ish of us.

Besides which, I get that pooh-poohing about Godwin’s Law and “everybody I don’t like is Hitler” and so on is a nearly irresistible tic in today’s liberal discourse, but c’mon people… we’re all comfortable using the term “neoliberalism”, which means we’re all willing to risk having the same Poli Sci 101 conversations over and over again in the mainstream (“yes, Virginia, Hillary Clinton and Paul Ryan are both liberals!”) for the sake of our own theoretical clarity. At the very least “fascism” would have fewer problematic discursive connotations than “tribalism”, which I absolutely refuse to use in this conversation without putting it in sneer quotes.

Will G-R @ 55

So you know what Trumpism wants to become, so we should call it that, rather than describe what it is, because the ideological conflicts of 80 years ago were so much clearer.

We live in the age of inverted totalitarianism. Trump isn’t Mussolini, he’s an American version of Berlusconi, a farcical rhyme in echo of a dead past.

We probably are on the verge of an unprecedented authoritarian surveillance state, but Hillary Clinton doesn’t need an army of blackshirts.

The historical fascism demanded everything in the state. Our time wants everything in an iPhone app.

“Trumpism” may be the term du jour in the US, but let’s try to kick our stiflingly banal American habit of framing everything around our little quadrennial electoral freak shows. After all, the US and our rigid two-party system have always been an outlier in the vigor with which real political currents have been forced to conform to the narrow partisan vocabulary of either a left-liberal or a right-liberal major party. If hewing religiously to a patriotic sense of US institutionalism is supposed to ultimately save the liberal political sphere from the underlying political-economic forces that threaten it, we might as well take a page from the Tea Party and start marching around in powdered wigs and tricorn hats for all the good it’ll do us.

In the rest of the Western world, particularly in Central and Eastern Europe, the “fascist” parties (Golden Dawn in Greece, Jobbik in Hungary, Ataka in Bulgaria, etc.) are generally less euphemistic about their role as fascist parties, and what forced sense of euphemism does exist seems to provide little more than a rhetorical opportunity for mockingly transparent coyness. To be fair, the predominant far-right parties in richer Western European countries (the FN, AfD, UKIP, etc.) are a bit more earnestly vague about their ambitions, so maybe a good compromise would be to call them (along with Trump) “soft fascists” in contrast to the “hard fascists” of Golden Dawn or Ataka. But fascism still makes much more sense than any other existing “-ism” I’ve seen, unless we want to just make one up.

> You seem to be dancing around the elite corruption that is motivating the rationales provided by neoliberalism.

Fair point. On the other hand, if neoliberalism rule, then neoliberals will be the rulers. And if not, not. Whatever the nature of the rulers, they rarely starve. Worldwide, average corruption is almost certainly lower in mostly-neoliberal countries than in less-neoliberal places like China, Zimbabwe, North Korea, …

The key thing is, take two neoliberal politicians, only one of whom is (unusually) corrupt. One entirely intends to deliver what you ask for, admittedly while ensuring they personally have a nice life being well-fed, warm and listened-to. The other plans to take it all and deliver nothing.

Given that nobody trustworthy knows anything, at least in a form they can explain, you can’t get useful information as to which is which. 300 hours of reading reports of their rhetoric in newspapers, blogs, etc. leaves you none the wiser. And by the time you have a professional-level of knowledge of what’s going on, you are part of the problem.

Might as well just stick to looking at who has which label next to their name, or who has good hair.

So much concern about the term tribalism. Well what is fascism? The use of tribalism to grasp political power and establish a totalitarian political order. Sound reasonable? Pick any fascism you like, the Nazis ( master race) the theocratic fascists in the US ( Christian rule ) Catholic Fascism ( Franco’s Spain) , you name it. It walks and talks like tribalism. Trump-ism is the not so new face of American fascism. It’s race based, it xenophobic, it’s embraces violence, has a disdain for civil liberties and human rights, and it features the great leader. Doesn’t seem to difficult to make the connection.

OK Bob, seems like we’ll need to spell it out… what is “tribalism”? What is a “tribe”? How do you define a “tribe” in any sort of precise sociological or anthropological way? Can the term be assigned a precise and useful social-scientific meaning at all? Or, conversely, is it a poorly defined pseudo-intellectual way to vaguely allude to the image of a small group of people, probably less than fully “civilized”, who respond with reflexive aggression to other, similar small groups of people? By using a term with these ramifications, are we defining ourselves as the “civilized” people who might encounter a “tribe” on some exotic jungle safari or something? Given how “civilized” peoples have historically dealt with the kinds of people they call “tribes” throughout the history of European imperialism, what kind of people does that make us in this analogy? And what are the political ramifications of defining racist populists by analogy as the kinds of people who are ultimately victimized by imperialists, whose analogous role we’re implicitly assigning to liberals and/or the left? In short, unless we’re trying to apologize for historical European imperialism, doesn’t calling racists and fascists “tribalists” mean we’re implicitly taking their side?

We need to find a better word, period. My vote is for “fascism”, or if that’s too much of Godwin’s-Law hot potato to handle, “ethnonationalism”. But if we want to be people of the Left, “tribalism” won’t do.

Historical fascism included not just Hitler’s Germany, but Mussolini’s Italy, Franco’s Spain, Salazar/Caetano’s Portugal, Ionescu’s Romania, the Ustase in Croatia, Tiso’s Slovakia, Petliura’s movement in Ukraine, and, arguably, Dollfuss’ Austria, Horthy’s Hungary, Imperial Japan, Peronist Argentina, the Poland of the post Pilsudski junta (read Beck on the diplomatics of a Jewish state in Uganda, which is I think symptomatic wishful thinking.)

There is a strong correlation between the nations whose rulers accepted fascists into the government and losing WWI. The rest were new, insecure states that could profit their masters by expansion. At the time, the so-called Allies, except for the USSR, were essentially the official “winners” of WWI and therefore united against the would be revisionists like Germany. Therefore it was desirable to propagandize against the Axis as uniquely fascist.

In fact, there was a powerful fascist movement in many Allied states as well. Vichy France had deep, strong domestic roots in particular, but the South African Broederbond and Jim Crow USA with its lynchings show how fascism and democracy (as understood by anti-Communists) are not separate things, but conjunctural developments of the capitalist states, which are not organized as business firms.

Democracy is associated even with genocide, enslavement of peoples and mass population transfers to colonists. It began with democracy itself, with the Spartans turning Messenians into Helots and Athenians expropriating Euboeans and massacring Melians. Russian Cossacks on the Caucasian steppes or Paxton Boys in the US continued the process. When democracy came to the Ottoman empire, making Turkey required the horrific expulsion of the Armenians. (Their Trail of Tears was better publicized than the Cherokee’s.) But the structural need to unify a nation by excluding Others led to the bloody expulsion of Greeks as well. The confirmation of national identity by a mix of ethnic, religious and racial markers required mass violence and war, as seen in the emergence of the international system of mercantilist capitalist states.

The wide variations in historical fascism conclusively demonstrate every notion of fascism is somehow something essentially, metaphysically, antithetical is wrong. Fascism and democracy are not an antinomy. Particular doctrines that assert this, like the non-concept of “totalitarianism,” serve as a kind of skeleton for political movements and parties. Since the triumph of what we in the US call McCarthyism all mainstream and all acceptable alternative politics share this same skeleton. It is unsurprising that such a beast is somehow not organically equipped to be an effective left. It’s SYRIZA in Greece defining itself by the rejection of the KKE. There is no such thing as repudiation of revolution that doesn’t imply accepting counter-revolution.

“Hillary Clinton is running the Democratic Party in such a way that she wins the Presidency, but the Party continues to be excluded from power in Congress and in most of the States. This is by design. This is the neoliberal design. She cannot deliver on her corrupt promises to the Big Donors if she cannot play the game Obama has played so superbly of being hapless in the face of Republican intransigence.”

This is just delusional. There is no vast neoliberal conspiracy of which Clinton and Trump are both members. There are no corrupt promises from Clinton to big donors–there are not even any discernible corrupt promises from Trump to big donors. Obama was not pretending not to have enough votes in Congress to get everything he wanted done.

There is no vast neoliberal conspiracy . . .

There obviously is a vast political movement, coordinated in ideology and the social processes of partisan politics and propaganda.

Creating a strawperson “conspiracy” does not erase actual Clinton fundraising practices and campaign tactics, which exist independent of whatever narrative I weave them into.

There are no corrupt promises from Clinton to big donors . . .

!!! And, you are accusing me of being delusional.

You seem to be bent on answering the question ‘why do they do it’

No.

I was trying to get at the essence of what they are doing, behind the confusing details of stated intention that always obscure the specific and contingent.

You can spend 300 hours reading the IMF projections of expansionary austerity for Greece or how a casino is going to rescue the economy of center-city Philadelphia with vast parking lots or how Michelle Rhee will reform education or Larry Summers is going diagnose secular stagnation for us real soon now.

‘Because we don’t know if what they propose will lead to society working or failing’ seems like a recommendation to relax and enjoy the agnatology. I hear three-card Monte is a lot of fun to play when waiting for your bus, too.

One reason I am so confident that neoliberalism in economic policy and neoconservativism in foreign policy are terminal scams is because we are so far down the road with these policies. We have experience and where there might have been a case for gains that could be shared, we are past the point of diminishing returns.

The case for the TPP as free trade vanished with tariffs decades ago; this is about disabling the state as a means of countervailing power against private capital and corporations. We have had a global financial crisis and much of the world is in a depression. Surely, we do not expect to bomb our way to democracy in Syria or Yemen?

But, sure Putin is hacking our sacred democracy.

The better question is ‘why do we let them?’

I do not think they are asking our permission, nor do I see effective means at hand to say, no. Collective political action problems require organization, including finding ways to bind leaders to the interests of followers and vice versa. But, you knew that.

Val etc.

I think that John’s use of the word “tribalist” here means a world-view that explicitly values members of an in-group more than members not of the in-group. It is different from racism because it may be over other factors than race – religion, citizenship, nationalism, or even region. And the key word is explicitly. The big difference between tribalist and both neoliberal and left positions is that the other two are generally universalist.

Neoliberals profess that everyone will be better off with deregulation, free markets, and technocratic solutions, and often explicitly reject the idea of something benefitting one racial, religious, or national group over another (though not the educated or wealthy, because these are allegedly meritocratic outcomes of the neoliberal order).

The left likewise generally argues for an increase in equality and equal distribution of resources for all, whether that be class-based or based on some sort of gender, race, or sexual equality.

So on an issue like a free trade deal, a neoliberal argument would support it, because gains of trade and various other reasons why it would make everyone better off; a leftist argument would oppose it on the grounds that it would make everyone worse off; and a tribalist argument would oppose it on the grounds that it took jobs away from American citizens, but wouldn’t worry too much about the other guys.

Of course, the lines are not always clear and distinct, they often overlap, mix, and borrow arguments from each other, and there are often hypocrisies’ and inconsistencies (and John’s point anyway is that the neoliberals tend to draw on coalitions with the other two factions), but I think it is a good general description of the distinction.

And it is different from the more sociological use of tribal to mean any in-group/out-group distinction and social solidarity formation. Everyone is tribal in the sociological sense, but the tribalist that John is referring explicitly approves of that tribalism. A left intellectual may look down on “ignorant, racist, blue-collar Trump supporters”, with as much bias as any tribalist, but would generally want them to have better education and a guarantee income so they were no longer ignorant and racist, whereas the tribalist generally thinks the other guy is less deserving.

Bob Zanelli: “What the left should have done is actually stop whining and gone out to vote in the democratic primaries.”

First of all, learn how to quote. You do it by using copy then paste and then typing in double quotes around what you’ve pasted. I don’t know where you got the lots of right parentheses thing from.

Second, one of the things that I predicted a while back was that somehow everything would get blamed on Sanders supporters. But this is one I hadn’t anticipated. I guess that it is incumbent on them to turn out in the same numbers as for the Presidential election forevermore — unlike any other kind of American voter, which is why the turnout for non-Presidential primaries is low — or everything is their fault and they’re whiners.

Third, no one who is seriously doing anything is voting in an election. I’ve been through this before here ad nauseum, but individual voting is meaningless. People who actually do things either do non-electoral political work or, if they are electoral activists, volunteer to do GOTV or similar activities.

Bob Zanelli: “What the left should have done is actually stop whining and gone out to vote in the democratic primaries.”

First of all, learn how to quote. You do it by using copy then paste and then typing in double quotes around what you’ve pasted. I don’t know where you got the lots of right parentheses thing from.

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Who are you the format police?

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Second, one of the things that I predicted a while back was that somehow everything would get blamed on Sanders supporters. But this is one I hadn’t anticipated. I guess that it is incumbent on them to turn out in the same numbers as for the Presidential election forevermore — unlike any other kind of American voter, which is why the turnout for non-Presidential primaries is low — or everything is their fault and they’re whiners.

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Gee what a concept, an obligation to vote in a democracy. As flawed as the US political process is, voting still matters and can affect change. It’s not easy , but then it’s never easy to reform anything.
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Third, no one who is seriously doing anything is voting in an election. I’ve been through this before here ad nauseum, but individual voting is meaningless. People who actually do things either do non-electoral political work or, if they are electoral activists, volunteer to do GOTV or similar activities.

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Oh I see the former Bernie supporters were too busy to vote because they were doing what???? Aren’t these activities designed to get people to …drum roll.. vote. If not what, sit ins on Wall Street like the idiotic occupy movement. Hey how that work out. Where did they go? Or are we just waiting for the proletarians to throw off their chains of oppression.

Besides the size issue, traditional Maori society is an absolute monarchy with slavery and cannibalism.

Bob Zannelli: Gee what a concept, an obligation to vote in a democracy. As flawed as the US political process is, voting still matters and can affect change. It’s not easy , but then it’s never easy to reform anything.

Just to give voice to the contrary perspective, voter turnout appears to play at least some role in the ideological process by which the US electoral system claims legitimacy: even though in purely procedural terms an election could work just fine if the total number of ballots was an infinitesimal fraction of the number of eligible voters (“Bill Clinton casts ballot, Hillary defeats Trump by 2 votes to 1!”) low voter turnout is nonetheless depicted as a crisis not just for any particular candidate or party but for the entire electoral process. Accordingly, if I decide not to vote and thereby to decrease voter turnout by a small-but-nonzero amount, I’m adding a small-but-nonzero contribution to the public argument that the electoral process as presently institutionalized is illegitimate, so unless we propose to add a “none of the above” option to every single race and question on the ballot, to argue that citizens have an obligation to vote is to argue that they are obliged not to “vote” for the illegitimacy of the system as such. And plenty of ethical and political stances could be consistent with such a “vote”, not the least of which is a certain historical stance whose proponents argued that “whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it…”

I mean that just as people who believe the US government is legitimate should have the right to express their political preference at the ballot box, people who believe the US government is illegitimate should have the right to express their political preference at (the abstention from) the ballot box, and that it’s at least possible for this to be a consistent political and ethical stance. Do you disagree? Is the legitimacy of your government a first premise for you? If so, Thomas Jefferson would like a word.

(Not to imply that I hold any particular fealty to the US nationalist mythology of the “Founding Fathers” and so on, but hey, they articulated a certain liberal political philosophy whose present-day adherents should at least be consistent about it.)

Also, not to get personal, but the smarm here is so thick you could cut it with a knife…

“Did I get you right? Is your response to an argument you find uncomfortable to simply intone ‘holy shit’? Holy shit…”

Sam Bradford@78 “I think I would rather abandon my obligations to the greater mass of humanity (not act against them, of course, just accept an inability to influence events) and be a member of a small society than be a helpless and hopeless atom in a sea of similar, utterly disenfranchised atoms.”

This is my answer to the OP. People will be attracted to different things, of course. For my part, it doesn’t seem realistic to hope we will come together and solve, or really even realistically attempt to solve, basic existential problems.

So, get together with your neighbors. Grow food! Make things. Recreate together. Make your own “government”. Ignore the shit out there. Try not to break their laws, and they’ll leave you more or less alone. Help who you can. If movements come up that are humanistic support them. Humans (in fact life it seems) are essentially tribal. It supports survival. Use it positively. And think small.

I’m old, and in touch with my mortality. So I try to pay attention to and appreciate the beautiful moments. Perhaps that’s all there really is. There is room for different approaches of course…this is mine.

if the US government was ever thrown it would be by the far right

So let’s get this straight… the only choice we have is between the center and the far right, yet it’s far leftists’ fault for not being centrists that the politics of centrism itself keeps drifting farther and farther to the right. Screw eating from the trashcan, it’s like you’re mainlining pure grade-A Colombian ideology.

Bob Zannelli: What’s the alternative?

There is no alternative.

Hillary Clinton is engaging in politics and she’s teh most librul librul evah! Why isn’t that enough? It is not her fault, surely, that the devil makes her do unlibrul things — you have to be practical and practically, there is no alternative. We have to clap louder. That’s the ticket!

Will G-R @ 94

Low voter turnout is interpreted as a problem by some people on some occasions. Why generalize to official “ideology” from their idiosyncratic and opportunistic pieties?

Why are the concerns of, say, North Carolina’s legislature that only the right people vote not official ideology? Or, the election officials in my own Los Angeles County, where we regularly have nearly secret elections with hard-to-find-polling-places — we got down to 8.6% in one election in 2015.

Obama’s DHS wants to designate the state election apparatus, critical infrastructure. Won’t that be great? I guess Putin may not be able to vote, after all!

Bob, my impression is that CT is supposed to be a philosophy-oriented discussion space (or it wouldn’t be named after a line from Kant for chrissake) and in philosophy one is supposed to subject one’s premises to ruthless and unsparing criticism, or at least be able to fathom the possibility of doing so — including in this case premises like the legitimacy of the US government or the desirability of capitalism. Especially in today’s neoliberal society there are precious few spaces where a truly philosophical outlook is supposed to be the norm, and honestly I’m offended that you seem to want to turn CT into yet another space where it isn’t.

Ragweed @ 73
Thanks, good explanation, given me a bit to think about.

I cannot speak to local government elsewhere in the U.S. My experience in places other than LA is too old to be relevant.

Regarding local politics in Southern California, I’d say we have the full-range of competence: from the best of civic boosterism combined with professional city management in smaller cities like Santa Monica, Glendale, Burbank, West Hollywood, etc. to remarkable large-scale achievements in special-purpose, regional entities like the Metropolitan Water District, on the good side, to the worst sort of control fraud and rampant corruption in places like Bell and Compton. LA Unified School District and the Los Angeles County Metropolitan Transportation Authority lumber along. The last sheriff (who was originally elected only because his opponent cum predecessor and boss was a corpse) is facing charges of obstruction regarding a federal investigation of systematic brutality in the administration of the LA County jail. The current Governor is deeply experienced and remarkably competent as a politician and, I presume, without really knowing, passably competent as an administrator. The previous Governor was Arnold Schwarzenegger and you can guess how well that went.

None of this — good, bad or indifferent — seems to me to have much to do with the process of voting considered as an informed choice of candidates. Maybe, the ritual of voting helps in some way. The fact that turnout can be so ridiculously low (less than 10% in that election I mentioned, where city council and schools boardmembers were elected), I suppose means that unions and smallish activist groups can exercise out-sized influence for their ability to GOTV, such as it is; maybe, that’s a good thing. If turnout were high, council election campaigns would cost more and depend more on mindless direct-mail and teevee spots and, by extension, low-information voters.

I don’t know that there’s a lot of interest in reform aimed at more competent or efficient government. The scale of the Unified School District or the City of LA would seem to be a major hinderance, but movements to secede or breakup the gargantua are opposed by the powers that be, for no particular reason that I can see. But, the appropriately scaled cities I mentioned seem to function pretty well. The County of LA concentrates executive power in a five member board; I have no idea what kind democratic accountability there is there — each member representing almost three times as many people as a Congressman — given the weakness of local Media and community consciousness.

Bruce W ilder @100

My understanding of the issue of breaking up the big jurisdictions in CA is that there was a lot of interest from the right at one point, with the claim being that people could choose the bundle of services they needed and dispense with a lot of inefficient bureaucracy. Unfortunately, it turned out what the rich really wanted was to get out of having to provide services to poor people. Which was, of course, not so great for poor people. At least that my recollection from reading Gary Miller’s “Cities by Contract” a long time ago.

The best stuff on voter involvement, appropriate size and so on, was written about 100 years ago by Richard Childs. You’ll need a good library to find him. Part of the reason for low turnout is that municipal elections are often held in odd-numbered years. Corrruption is much more of a problem for bodies that have low citizen interest– look at the NYC local school boards.

Bruce @ 104, I’m not clued into the SoCal-specific issues (so I don’t know exactly how much a Chinatown-esque narrative should be raised in contrast to your description of LA water infrastructure as “the best of civic boosterism”) but I’m thinking more of local governments like the ones stereotypically predominant in the Southeast, or even the legendarily corrupt history of “machine” politics in cities like Chicago. The fact that these sorts of governments exist and have existed in the US is why every American, even those of us who are well aware of McCarthyism and COINTELPRO and so on, can breathe a sigh of relief when we see the words “the Justice Department today announced a probe aimed at local government officials in…” because it means that the legitimate parts of our system are asserting their predominance over the potentially illegitimate parts. So in order to uphold the legitimacy of the system as such we acknowledge that sure, someone in rural Louisiana might not always be able to get rid of their corrupt local mayors/sheriffs/judges/etc. through the ballot box directly, but at least they can vote in federal elections for the people and institutions that will get rid of these officials if they overstep the bounds of what we as a nation consider acceptable. (This also extends to more informal institutions like the media: the local paper might not be shining the light on local corruption, but the media as such can fulfill its function and redeem its institutional legitimacy if something too egregious falls into the national spotlight.)

Accordingly, to treat the federal system as itself no more inherently legitimate than the local ones — to treat the government in Washington as fundamentally the same kind of racket as the government in Ferguson — is to argue that it needs fundamentally the same kind of external oversight, and barring a foreign invasion or a world government, the only potentially equivalent overseer for the US federal government is a mass revolt.

Howard Frant: . . . don’t you wonder at all if the term is hindering rather than helping thought?

Of course.

With regard to the quotation you took from commenter, RichardM:

“The problem with neoliberalism is that it isn’t really compatible with a modern free market economy. Simply because that system isn’t well enough understood to allow experts, let alone informed amateurs, to reach a consensus on what a particular change will actually do.”

I am not sure what the commenter might be thinking. I do think it is helpful to see the deregulation of finance beginning in the Carter and Reagan Administrations leading eventually to the GFC of 2008 as an historical project and a political whole, in which there have been deviations between the stated intentions of advocates, the reasonable anticipation of consequences by experts and the self-interested pursuit of short-term advantage in regulatory evasion and reform.

we call neoliberalism “economic rationalism” in Australia, at least in terms of economics policy, but no other countries use this term

= = = I am actually honestly suggesting an intellectual exercise which, I think, might be worth your (extremely valuable) time. I propose you rewrite this post without using the word “neoliberalism” (or a synonym). = = =

It is fascinating that younger US neoliberals (e.g. Matthew Yglesias) are totally sold on the the positives of ‘metrics’, statistics, testing, etc, to the point where they ignore all the negatives of those approaches, but absolutely and utterly loathe being tracked, having the performance of their preferred policies and predictions analyzed, and called out on the failures thereof. Is sure seems to me that the campaign to quash the use of the US, Charles Peters version of neoliberal is part of the effort to avoid accountability for their actions.

Cranky Observer @ 116

Thanks for that.

Sometimes, I think the label itself comes too close to suggesting there might be an alternative for the adherents of such a no-labels politics.

I write more about this over at my blog (in a somewhat different context).

I would say that neoliberalism is closer to market fundamentalism, then market liberalism. See, for example:
http://www.softpanorama.org/Skeptics/Political_skeptic/Neoliberalism/Articles/definitions_of_neoliberalism.shtml

=== quote ===
Neoliberalism is an ideology of market fundamentalism based on deception that promotes “markets” as a universal solution for all human problems in order to hide establishment of neo-fascist regime (pioneered by Pinochet in Chile), where militarized government functions are limited to external aggression and suppression of population within the country (often via establishing National Security State using “terrorists” threat) and corporations are the only “first class” political players. Like in classic corporatism, corporations are above the law and can rule the country as they see fit, using political parties for the legitimatization of the regime.

The key difference with classic fascism is that instead of political dominance of the corporations of particular nation, those corporations are now transnational and states, including the USA are just enforcers of the will of transnational corporations on the population. Economic or “soft” methods of enforcement such as debt slavery and control of employment are preferred to brute force enforcement. At the same time police is militarized and due to technological achievements the level of surveillance surpasses the level achieved in Eastern Germany.

Like with bolshevism in the USSR before, high, almost always hysterical, level of neoliberal propaganda and scapegoating of “enemies” as well as the concept of “permanent war for permanent peace” are used to suppress the protest against the wealth redistribution up (which is the key principle of neoliberalism) and to decimate organized labor.

Multiple definitions of neoliberalism were proposed. Three major attempts to define this social system were made:

– Definitions stemming from the concept of “casino capitalism”
– Definitions stemming from the concept of Washington consensus
– Definitions stemming from the idea that Neoliberalism is Trotskyism for the rich. This idea has two major variations:
— Definitions stemming from Professor Wendy Brown’s concept of Neoliberal rationality which developed the concept of Inverted Totalitarism of Sheldon Wolin
— Definitions stemming Professor Sheldon Wolin’s older concept of Inverted Totalitarism — “the heavy statism forging the novel fusions of economic with political power that he took to be poisoning democracy at its root.” (Sheldon Wolin and Inverted Totalitarianism Common Dreams )
The first two are the most popular.

bruce,

@117

Thanks for your post. It contains several important ideas:

“It wasn’t Liberalism Triumphant that faced a challenge from fascism; it was the abject failures of Liberalism that created fascism.”

“What is called neoliberalism in American politics has a lot to do with New Deal liberalism running out of steam and simply not having a program after 1970. Some of that is circumstantial in a way — the first Oil Crisis, the breakup of Bretton Woods — but even those circumstances were arguably results of the earlier program’s success.”

Moreover as Will G-R noted:

“neoliberalism will be every bit the wellspring of fascism that old-school liberalism was.”

Failure of neoliberalism revives neofascist, far right movements. That’s what the rise of far right movements in Europe now demonstrates pretty vividly.

John,

@112

“The most obvious test case is the teachers unions. Obama’s administration was clearly hostile to the (think of Rahm Emanuel!), but they nonetheless endorsed him, as the lesser evil.”

Lesse evilism that Bill Clinton used for moving Democratic Party into neoliberal camp (as in “those f*ckers from trade unions will vote for Dems anyway, they have nowhere to go”) no longer works.

Far right will absorb those working class and lower white collar votes. And they became a political force to recon with, which disposed neocons from the Republican establishment (all those Jeb!, Kasich, Crus, and Rubio crowd ) despite all efforts of the party brass. Welcome to the second reincarnation of Weimar republic.

Trade union management, which endorsed Hillary, now expects that more then half of union members will probably vote against Hillary. In some cases up to 2/3.

So Dem neolibs became a party that is not supported by the working class and if identity politics tricks will not work, they might get a a blowback in November. They can rely only on a few voting blocks that benefitted from globalization, such as “network hamsters” (programmers, system administrators, some part of FIRE low level staff, and such) and few other mass professionals. That’s it.

I think liberalism in its various threads has often had a deep ambivalence about the common people, their wants and welfare. What common people want is a society and a political economy that work for them, providing a modicum of security. They are not much interested in the details, the how or the architecture. So, Lupita’s socialism plus some forms of traditionalism and hierarchy, but without a specific philosophy, ideology or policy program, until some philosopher, entrepreneurial politician or demagogue supplies one.

What liberalism often wants to offer is a pious idealism: a notion that a public policy of virtuous intent, high principle and sincere effort is best. This is the liberalism that thinks education is the answer to increasing income and wealth inequality. This is the liberalism that thinks emulating an ideal of perfectly competitive markets will make capitalism efficient and fair. This is the liberalism that thinks “free and fair elections” solve social problems and reforming the Electoral College is an urgent problem of American democracy.

This kind of political piety can get along quite well with a conservatism of sound money and the rule of law, because they both reflect common faith in moral causality and that a just world rewards virtue, individual and personal or collective and public. In casual discussion of economics, the virtues of productivity growth or a trade surplus will be undoubted, just as the public debt will be regarded as a danger. Not because of any understanding of mechanics, but simply from an alchemist’s instinct that the meaning attached to things will work some transformative result.

This is not the only possibility for liberalism: there is also the possibility of actually acting competently to solve problems, to develop cooperation for the common good and general welfare, while recognizing that different elements in society have legitimate but conflicting interests. This is the progressive politics of technocratic regulation and civic or national development and looks to construct powerful institutions and to accomplish great tasks. This liberalism can have cordial relationships with certain kinds of conservatism — paternalism, civic boosterism, the machine politics of patronage and honest graft or national greatness, say — but is likely to find itself in conflict with the reactionary conservatism of vested interests, particularly predatory ones.

Both of these tendencies in liberalism — the abstract idealism and the institution building — make critical accommodations with the natural conservatism of wealth and business, and those accomodations shape the liberal program of a particular time and place and make it politically possible. In this, liberalism acts as the better angel of elite conscience and aspiration to persuade the powerful to permit and institute necessary change and adaptive reform, or in more benighted periods, simply to protect a level of advocacy and critique against reactionary authority and its expedients.

With the common mass of humanity, liberalism has had a more ambivalent relationship, in part because of its accommodations with self-interested wealth and hierarchy and in part because the common mass of humanity so frequently falls short of the wishes of the liberal imagination for common reason, justice, human initiative and autonomy.

Still, it is popular support — indeed, demonstrations of mass support — that have often been crucial for the success of liberal revolutions, even if liberals want to deliver principles, not bread, in part because of their accommodations with established elites.

In some of this, our contemporary neoliberalism is a well-qualified liberalism. It has accommodated conservative vested interests and it leads with confidence in its own virtuous intent.

What’s perverse about contemporary neoliberalism is its active hostility to institution-building or even institution-preservation. This is clearest, to me, in the core program of “liberalizing” trade and finance. This is where the neoliberal label is most informative, because it draws attention to a persistent and recurrent program of restructuring the world economy as a global system dominated by a poorly regulated system of global finance that stretches back to the 1970s, building step-by-step and always drawing on an ideological view of the economy as a self-regulating “market” system to justify its evolving policy program.

In one critically important way, neoliberalism is a betrayal of liberalism, understood as a political movement to rationalize authority (no, Lupita, in the great historical sweep, liberalism has never been about GDP): the neoliberal political program has been to foster and protect elite corruption, enabling the looting of institutions. The ideology of “markets”, by leaving all the relevant concepts of hierarchical probity out of account, is well-suited to justify this program, by systematic omission of terms.

Howard Frant: I don’t know what liberalism is.

I realized that a while back.

I presume most people know something about the history of liberalism as a set of evolving political philosophies and movements and if they feel the need, they can quickly consult Wikipedia or other reference works.

If you want to understand the particular intellectual history of contemporary neoliberalism, I would recommend the essays of Philip Mirowski.

I wish I could vote for the Hillary Clinton of your imagination. Alas, I live in the real world.

Peter T: “But why finance as the avenue? And why seek to cannibalise large parts of the public sphere?”

I think that _Social Limits To Growth_ is a partial answer to this one. Neoliberalism as an abstract may be this or that, but in practice neoliberalism is staffed by meritocrats. Meritocrats are, by definition, mostly not people who have inherited great wealth. So individually and as a group they have a problem: how to amass wealth and social status for themselves without openly dispossessing the inheritors of great wealth, who the system is set up to protect and who are indeed accumulating even more.

Cannibalizing the public sphere is one way to do this: it takes resources that are communally held and puts them under private control, and in a sense dispossesses the poor. Finance is another way because finance is mostly a scam — all investment advice is a net negative, complex investment mechanisms end up costing money in the long term, etc. The effect goes beyond simple predation of the poor via payday loans and the middle class via 401(k)s to spread elite wealth around a relatively large number of very well paid financial managers.

Peter T: “But they don’t seem to have created a viable ecosystem of stable well-paid jobs around them.”

We, communally, don’t actually need anything like the amount of labor that we once did. If stable well-paid jobs are linked to a need for stable skilled labor, then there aren’t going to be as many.

But you quoted half of the two ways that I listed. Finance is the other. Finance is best understood, I think, as a way of creating these stable well-paid jobs for a narrow meritocratic elite where the money comes from a different wealth-holding elite as well as from the middle class and the poor.

sorry – should have been less elliptical. Marketizing government does not create stuff. But nor does finance – it just feeds off some other process. So in turning to public services and finance, the elite are signaling that there’s no (or not enough) pickings in making stuff or doing stuff, and that taking stuff off foreigners (the other classic way to riches) is too hard.

Peter T,

“sorry – should have been less elliptical. Marketizing government does not create stuff. But nor does finance – it just feeds off some other process.”

Marketizing government can create things sort of, since the services can be provided by different companies rather than all by government. Government is more concerned with providing services or utilities. Utilities getting sold off doesn’t seem to be that practical to me, since the electricity and gas and water is about the same no matter what company is the owner, and its not clear to me that the companies can run the services much better than government. But with services marketizing government provided services can create more choice, which is arguably a good thing, although in various cases there are problems.

Maybe finance reforms were meant to inject cash into the economy. I suppose the finance reforms were a response to stagflation…

Peter T @ 131: I’m less interested in the typologies than in the underlying drivers of the process. . . . why finance as the avenue?

Money makes the world go ’round? It is almost hard to understand the question, because, really, what other avenue is there, to the symbolic manipulation and domination of the modern economy?

I sometimes wish someone like Brad DeLong could pull it together to write out a really good analysis of the long arc of the Industrial Revolution(s), with both money and conquest and the problems they confronted and solved, fully intact. Then, we’d have a better idea of where we are on this long wave. But, I guess we have to go on with the Brad DeLong’s we have, not the ones we wished we had.

Money and finance function as fictions that allow people to plan and invest in an imaginary future. They are the virtual mirror of the sunk cost investments that are the essence of industrial development, allowing us to pass like Alice thru the Looking Glass into a virtual world that masks uncertainty and paradox.

The problem of sunk cost investment, as I have said in comments many times, is how to recover the investment and earn a return. By their nature, “sunk costs” should not figure in subsequent decision-making; once made, they are no longer costs aka scarce resources that must be coaxed into a particular use with income, these investments once made are resources dedicated to a use and available for free. In prospect, building a railroad from London to Manchester seems like a no-brainer. The reduction in transportation costs, including time to travel, is so large, that there surely must be an opportunity to earn back the sunk cost investment in right-of-way, track, rolling stock, organization with freight and passenger rates. But, it is not as obvious as it seems, because the costs of transportation after the railroad is built won’t be what they are before and people will pay only after, based on costs after. Even under the cover of monopoly, competing only with itself, the railroad once built cannot easily negotiate sufficient rates; the savvy freight forwarder will offer enough to cover variable costs, knowing it will profit the railroad to take the offer, even if the offer is not sufficient to earn a return on the huge sunk cost investment.

The certain beneficiaries of the coming of the railroad will be the merchants and the owners of land (aka location served). People quickly came to understood this in the 19th century and the capital of early railroads was subscribed by merchants organized as civic boosters, followed by political campaigns to make land grants along new routes, so that the rising value of land could finance the enterprise. The strategic competition between shippers and carrier over rates became a political contest over state regulation of rates. Another problem was that railroads required extensive use of hierarchies and what we would call command-and-control to manage complex operations and many waged or salaried employees. The railroads tried hiring professional military officers, who combined both the rudiments of college-training in civil engineering and some experience leading large hierarchical organizations, but they also need to impose constraints on their power. It was hard to tell if the managers of a large enterprise were doing a good job or the right things. Leverage helped to constrain railroad management and later, on the same model, the management of large industrial and commercial enterprises as these emerged in the 1880s and 189os, by committing the organization to pay debt service on some large part of their large sunk cost investments, leaving what could be accomplished by effective management to be rewarded by the residual.

What I hope to establish with this brief sketch is that economic returns on sunk cost investments are economic rents and accrue not to virtue, but to political power. Property rights among them, certainly.

Neoclassical economics, at least as rendered in textbooks and other children’s stories, tries to make this into an impersonal supply and demand, where relative scarcity (relative to what being exceedingly vague) and marginal costs are controlling. (P = MR = MC with P a function of Q and vice versa) But, in the real world, large sunk cost investments mean that marginal costs are low and falling, relative to the kinds of prices that might earn a return on invested capital; marginal costs are not controlling squat. In the real world, what matters is the political power to earn an economic rent, but having that political power and being able to organize a sunk cost investment in some enormously productive new technology can make an entrepreneur doubly powerful, even as bargaining in the presence of sunk costs causes the benefits to leak out into social and economic networks, as in the example above, the railroads enabled commercial and industrial cities.

In the First Industrial Revolution of coal, iron and textiles, Great Britain was aided by its institutional structure, and in particular, its central bank and a handful of stable companies with marketable stock and debt, led by the English East India Company. The returns on many necessary investments to make the industrial revolution happen were due to often very small increments in productivity and to make deals and calculations over long periods requires a stable money and credit, and particularly the ability to hedge risky investments with liquid “risk-less” ones, like the national debt mediated by the Bank of England and the stock of the English East India Company. The equivalence of land rent and stock returns in a stable income — “Mr Darcy is worth £10,000 a year” — made a social revolution in 18th century England that drove a very modest but critically important Agricultural Revolution followed by the quickening of the Industrial Revolution. When the Duke of Bridgewater sunk his considerable fortune into his eponymous canal, inaugurated in 1765, and the price of coal at Manchester fell by half and he emerged as the richest man in England due to the longprospect of certain income, he amplified an example already well-understood. When Boulton devised complex schemes to enable coal mines to finance the use of Watt’s steam engines from realized economies in coal consumption compared to Newcomen engines, he was using his patent monopoly, but also the stable value of the pound and his own financial fortune.

My point is that finance has always mattered in the course of the Industrial Revolution because large sunk-cost investments are at the center of it and because those returns accrue to political power, not productive skills or other virtues, but rather expressed both as property rights and in rougher forms.

We worry about automation, but the early textile mills, such as the famous Lowell Mills, were highly automated. The workers were mere machine tenders. When the Second Industrial Revolution reached a crescendo in the United States in the 1920s, it created a crisis of political power and finance, creating economic instability, domestically and globally. The New Deal devised a series of kludges in response. The enormous productivity of assembly lines and process manufacturing eliminated craft skills and the traditional political power that had protected the incomes of craft workers. The wages of “unskilled” workers and labourers were under tremendous pressure in agriculture and manufacturing. Industrial unions pressed up wages. A complex program for managing agricultural incomes stabilized the farm sector where a large part of the American population had been trapped in hopeless poverty in the course of the 1920s (not incidentally setting off an explosive growth in investment in increasing agricultural productivity).

The New Deal set up a carefully managed economy that was able to take advantage of America’s abundant petroleum and build out an industrial and commercial economy of increasing productivity, by investing heavily in public goods and realizing a return on those investments by taxing economic rents that rose as the economy grew. The post-war order put the U.S. into the role of the Good Hegemon, stabilizing an expanding trade among industrializing countries.

When that plan began to run out of road, it destabilized that economy. Milton Friedman et alia were ready with a story that hid the careful management that created that economy. The good economy, you see, was stable because of a general equilibrium of markets and those markets were an emergent phenomenon of self-organizing business and the key was non-interference by government and lower taxes. The story was a crock of lies, but it had the convenient merit of justifying a political policy of disinvestment, dismantling the New Deal economy for fun and profit. Also, an economics of markets overlooks the actual economy of hierarchies, making the whole discipline of policy economics cum macro economics an exercise in agnotology.

By roughly 1970, the U.S. advantage in economic development was gone vis a vis Western Europe and Japan and the Almighty Dollar was not almighty enough anymore to be the vehicle by which the Good Hegemon stabilized the world’s currencies and financial flows. The dollar would have to float and, naturally, bankers and financial speculators would have to manage currency exchange markets. Nice work if you can get it, the currency carry trade.

Also from roughly 1970 on, the U.S. would have to import a lot of oil. This oil would have to be paid for with something. If it was paid for with goods, this would diminish domestic income. If it were paid for with money and the money was “recirculated” as financial investment, the real resources and production diverted to obtain oil could be reduced. And, as a dividend, the local populations of oil rich countries would not be consuming their own oil in, say, industrialization of Iraq, let alone the mass-produced products of Western industry. Of course, if the oil sultans were not going to end up owning everything, asset prices would have to inflate and the Western rich would have to ratchet up their own wealth to keep up.

When China came to its white cat, black cat moment, and wanted to devise a plan to industrialize, it came into a world of barely managed floating currencies where you become your own Good Hegemon with your own Bretton Woods. In the virtuous world of the market economy, finance doesn’t enter it; China has lots of labor, knock down wages, do “labor-intensive” production, problem solved. But, in the real world, they wanted to finance sunk-cost investment in the most modern manufacturing technologies situated in a modern economy with good roads and electricity that stayed on all day and ambitious literate disciplined workers. Modern manufacturing was never labor-intensive to begin with — the whole set of concepts of gross substitution and labor-intensive and capital-intensive propagated by neoclassical economics is sheer idiocy. The problem is to reduce error and waste and institute systems of effective process control, which requires sunk cost investments. So they managed their exchange rate and their domestic price level, creating a financial environment in which investment in manufacturing in China involved very low risks financially. It wasn’t even mostly direct investment in China; China created a system in which western corporate giants profited financially from sourcing production in China. So, giants like Wal-Mart and J.C. Penney and, of course, Apple organized their supply chains around China, while continuing to earn their profits economic rents from gateway rents in the global distribution system, intellectual property claims and so on.

I am sure I have told Peter T anything he didn’t already know, and what I have offered is only inconsequentially an answer to the question, “why finance?” What ought to be interesting, it seems to me, is why we have a dominating ideology like neoliberalism which supplies such a false explanation of the world.

Since money and finance are fictions, they glide easily and dangerously between truth and fraud and this is the prime political problem. Money and finance generate the numbers on which everyone in a loosely coordinated system of distributed decision-making acts and makes deals with one another. As in the American housing bubble, finance out-of-control can generate a price matrix that is “false” and the correction — if it does indeed “correct” and move toward something more “truthful” — visits consequences on some but not others.

Rich Puchalsky says neoliberalism is the ideology of the managerial classes. I say neoliberalism are the lies the most comfortable among the elite tell themselves.

I sometimes wish someone like Brad DeLong could pull it together to write out a really good analysis of the long arc of the Industrial Revolution(s), with both money and conquest and the problems they confronted and solved, fully intact.

DeLong? He did have a post with a bibliography of “big think” books not so long ago, most are mainstream or neoliberal

Giovanni Arrighi, The Long Twentieth Century 1994, is considered the recent “classic in its field, published in ten languages”, although there are really quite a few more.

Not only does Arrighi use Kondratieff long waves (and the shorter waves), but puts a focus on consecutive Empires: Genoa, Dutch, British, US, each moving through an internal developmental cycle of mercantilism => industrialism => finance => decline and displacement.

Will G-R: “If we’re searching for institutions of neoliberalism, obviously we can talk about established actors like the IMF, World Bank, WTO, and so forth”

Yes, as well as investor-state dispute settlement, as you point out. But the problem with this is that people think that you are defining neoliberalism as “everything that is bad” (as a commenter on my blog mentioned). Neoliberalism also expresses itself in institutions like those that will manage the Paris Agreements, which are good (at least compared to an alternative of nothing, or of global warming denialism). I’m not trying to buy into the presumption that there is no alternative: clearly there are possible agreements that are better than the Paris Agreements. But in the short term we have to solve pressing civilization-threatening problems, and neoliberalism does offer a world system through which these problems can at least inadequately be addressed.

Taking the world system past carbon involves a huge public good / sunk cost, and there’s no way for the market to do it. (People can try to set up “market incentives” that try to force the market to do it, but these work about as well as any non-economist would expect.) It’s not certain that the Paris Agreements will produce the international coordination needed to do this via governmental means, the only means available. But neither was neoliberalism flatly unable or unwilling to address the problem at all, as some people predicted.

What I was trying to get at above with my description of the finance industry for Peter T is that there is more than one elite, and the neoliberal elite is capable of throwing some industries and elites under the bus, even as it is capable of throwing poor and middle class people under the bus. Managers are not tied to ownership of wealth, and don’t need to protect every source of it.

howard

You’re talking pedigrees and ideal types. There’s a cluster of programs centred on markets as the best way of doing everything, the imperative of globalisation, an emphatic individualism that, while it owes something to classical liberalism, is distinct in its own right. Hence neo-liberalism as a convenient label. This cluster was widely shared – with differing emphases – on both left and right across the anglosphere. Labour governments in NZ and Australia, for instance, took up much of it, as did Blair and Clinton.

The centrality of market economics really is new, and reaches quite astonishing heights of devotion. An Australian labour government, for instance, mandated that no new expenditure proposal was to be considered unless it could be demonstrated that a “market failure” existed in regard to the service in question. The endless technocratic tinkering with the kludges of privatised/corporatised utilities, health care etc could only be done by people convinced that, with faith and the right formula, the market CAN turn lead into gold. An early C20 liberal would find this bizarre.

And this phenomenon is quite separate from the question of how Hillary compares to Sanders.

I’d like to believe that Kevin Drum is wrong.

http://www.motherjones.com/media/2013/05/robots-artificial-intelligence-jobs-automation

But somehow I don’t.

howard

It’s not really a technocratic argument, in that measured outcomes don’t seem to count in the debate, nor are obvious failures met with reversals of policy (usually, more band-aids are applied). Also, the trend covers much more than private delivery of services. This goes hand in hand with financialisation of government revenue flows – Chicago parking meters, municipal bonds, Australian government building rents and so on. The two should be seen together as driven by the need to extract rent from new sectors. This suggests to me that older sources of rent are not delivering enough (btw, I am not using rent in a pejorative sense. As bw notes, rents are pervasive and essential – at some level or other).

Will G-R: “I’m not sure why you bring this up as if it’s somehow a point in neoliberalism’s favor.”

Because it is a point in neoliberalism’s favor. We don’t have to say that the Paris Agreements are the best agreement ever, or even a good agreement, in order to say that they are an agreement and that one is critically needed. If we can’t agree that neoliberalism can do anything at all then it really does become kind of an empty category in the mind of anyone not already convinced.

In particular, I think that it’s quite possible that without a neoliberal world system we wouldn’t get any agreement at all. There’s a lot of motive for individual countries to keep going with carbon and take the short term benefits over the long term cost, especially if the cost will be felt most by other countries with worse geography. Yes, if there was international socialism, we might get a better agreement, but there isn’t and neoliberalism is at least a world system.

Parenthetically, I don’t think that the left in general handles global warming issues very well. It tends to get trotted out as “there’s an upcoming catastrophe, and capitalism will do nothing to stop it.” Well and good, but it has to actually be stopped, and very significant action has to be taken within the next ten years. That action is going to have to happen under the current system because there is no sign of that system’s replacement by anything else short-term. So decarbonization is going to have to be made to work under the current system whether we like it or not, and it’s not going to help to insist that the current system can do nothing.

I’m not in favor of the general idea of “if we don’t pretend that X is a solution, then people will actually push for a real solution.” In reality, they mostly won’t.

But look what your assumption is leading you to — a shift from prevention to coping. That’s exactly wrong for this moment in history. First, there really isn’t any coping that can usefully be done, not if we can’t muster the lesser effort needed for prevention. Second, we’re in a critical window for prevention. If there’s any chance, we have to pursue that chance. And substantial progress is being made, so it’s really not a good assumption that prevention is going to fail. Third, there is no binary that neatly divides outcomes into success/prevention and failure/coping. The nature of the problem is that it can always get worse: we can reach 4 degrees, 6 degrees, etc. “Prevention” is going to have to occur at some point, even though damage has already been done.

I’m not suggesting that people simply go to sleep and assume that the problem is being handled — on the contrary. But people have to have some possible route of action, and foreclosing the primary available one is not a good idea.

Will G-R @151

Sorry, I didn’t realize you were a furriner (though I guess I should’ve from your name) or I wouldn’t have assumed you don’t loathe Sanders. Yes, my understanding of the exuberant efflorescence of leftist views, particularly in Europe, is probably stunted. My knowledge of wild mushrooms is inadequate too.

“as if there’s some reason the calculated poses she’s affected over the past year+ of the public campaign circus-clown routine are a necessary guide to her presumptive policy agenda in office”

You do have a gift for invective, even though I can never understand what you’re getting at. Politicians do tend to try to do in office what they’ve said they’re going to do. I would say that’s probably a better guide than just saying that she will slavishly carry out the dictates of her neoliberal masters.

I don’t think “neoliberalism” is part of “the basic terminology of political philosophy.” Whether as a concept it has any usefulness for talking about the Democratic Party in the U.S. is an empirical question. At this point I’d say no. At a minimum, let’s get away from all the stuff about hard and soft neoliberalism and just say that it may not appear as a pure type.

And not to dive down another rabbit hole, but the Oslo Accords were negotiated by Rabin and Peres, who undoubtedly were serious about a two-state solution. Netanyahu, not so much. The idea that Israel would ever have accepted a one-state solution is fantasy.

Will G-R

Well, above your apparent criterion was the good of humanity at large, without respect to national boundaries. By that standard, neoliberalism has been very, very good. Over the last thirty years or so, extreme poverty has fallen by almost two-thirds around the world, and by almost 90% in east Asia. Hard to believe that doesn’t have a lot to do with the movement of manufacturing overseas.

http://iresearch.worldbank.org/PovcalNetPPP2005/index.htm?1

Not much political reward in the US for that, of course. So if I may turn to the US for a moment, I think, as I said, that a big increase in the minimum wage and two months’ paid family leave would make a big difference in the lives of a lot of struggling people. And the top of the income distribution actually would take a pretty good hit. So if she’s a tool of The Rich (excluding George Soros, who apparently gave a lot of money to her Super PAC), then she won’t make much effort to raise the minimum wage, whereas if politicians try to keep their promises then she will. So we’ll have to wait and see. I think she will.

On the contrary, if Yasir Arafat had ever done anything politically courageous, and had been assassinated as a result, that (the assassination) would not be a shock, but the assassination of Rabin was a shock, which is probably security was so lax. Yes, there’s a reasonably sized group of extremist crazies in Israel. But I doubt anyone is holding back on offering compromises because they’re afraid of being killed, as Arafat clearly was. It is true that a lot of moderates at this point don’t want to reopen Pandora’s Box. So the Palestinians may once again have missed their window. There was a genuine peace movement in Israel once, but it was pretty much cut off at the knees by the second intifada.

It seems to me that there’s an element of wishful thinking in the thesis that elites face popular revolt: the feeling that they (especially American elites) really ought to be facing popular revolt given the failed wars and poor economic growth, not to mention the displays of monumental greed and indifference. The actual “revolt”, though, remains remarkably quiet so far, but elite observers are doing a lot of looking around for signs of a turn away from trends and finding them in the Trump phenomenon, the Brexit vote and, as in the OP here, Clinton’s reluctant opportunism in acceding to Sanders’ more popular policy proposals. It feels like the end of an era, probably because it is, but for the moment, in the U.S. it feels remarkably normal despite the surreal aspects of, say, the Trump campaign.

I find myself returning to the comment of RichardM @ 50:

The problem with neoliberalism is that it isn’t really compatible with a modern . . . economy. Simply because that system isn’t well enough understood to allow experts, let alone informed amateurs, to reach a consensus on what a particular change will actually do. [I edited out the cant, “free market” modifying economy; that phrase was making me stumble.]

I disagree with RichardM, but obliquely.

Neoliberalism does presume that a consensus on policy consequences is not only possible, but largely extant. That’s a point I’ve tried to make over and over about how and why the 1982 Peters “Neoliberalism” became a strand woven into the same rope with the Hayek’s Mount Pelerin Society (1947) “Neoliberalism”, Milton Friedman’s “free market” vision from the 1970s, the Washington Consensus (Williamson 1989), and latter-day German ordo-liberalism.

Within the circle of official experts, aka mainstream neoclassical policy economics, the conversation settled into a dialectic between conservative libertarian views and centrist left views, between Krugman and Stiglitz on the “left” and Greg Mankiw and Tyler Cowan on the right (with a further right of Lucas and Prescott anchoring the profession’s more esoteric methods and pedagogy in zombie land, as JQ has written).

In mainstream politics, the dialectic between centre-right and centre-left followed the contours of the third-way politics of Clinton following Reagan and Blair following Thatcher: a politics that legitimated and extended, with modifications, the fundamental changes introduced by the former figures. In continental Europe, traditional center-left socialist parties were increasingly pressed into accepting the consensus economic views of the center-right, even entering into coalitions.

The “neoliberalism” that has emerged as an ideology of the managerial and executive classes is an apology for policies that work for those elite classes and against everyone else. For a time, that wasn’t as apparent as it is now. Economic bubbles delivered apparent dividends to a large number of people, especially people with “home ATMs” in the days of the housing bubble. Student loans allowed lots of people to go to college. The dick moves, such as changing the bankruptcy laws to make it difficult to escape foreclosure and perpetual student debt, flew under the radar and Obama certainly never seemed to pay a political price for his disinterest in helping people facing foreclosure or prosecuting corporate executives for malfeasance in banking.

In the Eurozone, the moralizing narrative about the feckless Greeks seems to have been widely persuasive. What seems to me to be general disinterest in the opioid epidemic in the U.S. is remarkable — for three minutes it “explained” Trump voters and then it was on to the next news cycle. The seamy underside of the new debt peonage revealed by Ferguson has become a racial issue, in part because it has to be a racial issue to get any attention.

“Neoliberalism” as the ideology of a parasitic elite class may be getting stale with the wider public that is being forced to bear the costs now that the bills are coming due, but I am not sure that anything is being done on the left that would make people any smarter, any less saps for the kind of sanctimonious, moralizing frauds offered by, say, Hillary Clinton.

Typically, political cycles end in a bang, not a whimper. The arguments do not just lose persuasiveness. There are actual policy disasters on the ground. We’ve already had the GFC of 2008 and neoliberalism survived. Neoconservative foreign policy had Iraq and Afghanistan, but never let go of their self-confidence or policy pulpits; now we’ve had Libya and Syria and the neoconservatives are still with us, ready to move on to Ukraine and the South China Sea.

One problem I see is that it is very hard to introduce any reform, which doesn’t trigger a painful reckoning. Could Australia extract itself from its epic housing bubble without hurting a lot of people? Could the U.S. get out of Iraq and Afghanistan without facing a potent charge from the Right that the policy of withdrawal triggered the loss of the war?

Could the U.S. institute any sweeping economic reform that didn’t involve a stock market crash? What would a direct attack on executive compensation require politically? Is such a thing even imaginable or are we stuck forever in neoliberal hand-wringing over an abstract “increasing inequality” driven by impersonal forces or globalization and robots?

I see a tactical retreat in the Obama Administration’s moves to widen the scope of overtime rules and the tepid support of Clinton for increases in the minimum wage. The closing of ITT education was a remarkable signal that there’s some boundary on predation in education. Maybe the TPP trade agreement is dead, maybe not; Clinton’s opposition seems to lack conviction. The titanic struggle in the Labour Party over Corbyn’s leadership is an interesting spectacle, but I don’t think it is entirely implausible that the former Pfizer Rep pulls it out.

Neoliberalism may not survive as a brand management strategy, but I am not seeing the new class losing its grip on power, so it is hard to be optimistic.

I think it is quite possible that Administration of Hillary Clinton, “just a standard liberal Democrat”, goes down with the neoliberal (economics) cum neoconservative (foreign policy) ship, but the loss of credibility for the left is broad and deep, because the left critique has been as enveloped by the trivial and resentful tribalism (nurtured as a manipulation strategy) as the right.

bruce wilder

“Neoliberalism does presume that a consensus on policy consequences is not only possible, but largely extant.”

If the world is really too complicated to figure out, how can we advocate any policies at all? How do we know our policies won’t do the opposite of what we want? This doesn’t seem like a particular weakness of neoliberalism vis a vis, say, socialism. In the case of the minimum wage, Congress fell back on its old established custom and asked the neutral experts (the CBO) for their analysis, then proceeded to argue about and try to spin the results. That seems like about as good as you can get in a democracy. Do you have an alternative in mind?

I like the scare quotes on “left” when discussing Krugman and Stiglitz. Yeah, the fact is, economists know some things that other people don’t, although they don’t get everything right. The Sanders campaign had an unseemly episode when its economist made some patently ridiculous claims and got called on it by other Democratic economists, who were promptly accused of being shills for Hillary. Turns out the guy had made a fairly boneheaded mistake.

To get to the heart of your claim, how has Peters become a strand woven into the rope of neoliberalism, except in the minds of leftist intellectuals? Have you heard a lot of people citing Peters as an inspiration? I haven’t. In fact, when I read Europeans talking about the evils of neoliberalism, they’re talking about Hayek and Friedman. I’ve never heard anyone talk about Peters, nor have I heard American politicians mention him, as Republicans mention Hayek and Friedman.

Electoral constraints seem not exist in your world. If Corbyn is encountering resistance as head of Labour, that’s because the managerial class is keeping him down, not because people think he can’t win. Similarly, Bill Clinton and Tony Blair are just alien intrusions rather than a response to repeated rejection of the party by the voters. The voters are just an epiphenomenon; keep your eye on the parasitic class.

The latest word to be drained of meaning so that it can be used as a placeholder for “things I don’t like” is “neoconservative”. This used to designate a particular school of right-wing thought, but now it seems it applies to anyone who’s not a pacifist.

And Maureen Dowd just told us in the NY Times that Clinton plans to “unleash hell on the Syrians.” Those poor Syrians! Will no one save them from this heartless neoconservative?

efcdons

Whoa! Where did the Romers come from? I didn’t say anything about them.

(The Fed does actually have statutory responsibilities, and one of them is keeping inflation under control. I’m not a macroeconomist, but I doubt it’s very controversial that “more demand-side stimulus in an economy closing in on its productive capacity” is going to create inflation. The key phrase there is “closing in on its productive capacity.”)

OK, I just read “A Neo-Liberal’s Manifesto.” As I suspected, it has no relation to what you’re talking about. I think the actual Peters is much less interesting to people here than the place-holder Peters who is everything we don’t like. Peters says absolutely nothing about getting tough on crime, or indeed any of the other things that you consider his essential contribution. It’s hardly the first time I’ve seen academics do violence to get someone to fit into the Procrustean bed of Theory. But it’s not a good way to advance knowledge. (I’m not pointing the finger at you as theorist here.)

Incidentally, he makes it clear he invented the term and shows no sign of being aware of the European meaning.

I’m so ignorant I don’t know what the PLP is. But wasn’t there someone called Thatcher in Britain? And wasn’t he or she PM for kind of a *long, long* time? How’d that happen? Sorry, I don’t believe that if everyone just gets behind Corbyn he’ll suddenly be electable. I suspect, in fact, that a lot of MPs care more about getting reelected than they do about ideology. No, constraints are not set in stone. But that doesn’t mean voters wishes don’t matter. And no, this is not the ’90s. Also, Hillary is not Bill. And Bill is not Bill from the ’90s.

Rich 16: “I’ll try not to dwell on my hobbyhorses too much … current First World “left” populations (especially in the U.S.) want to turn everything into individual moral questions through which a false solidarity can be expressed and through which opposing people can be shamed.”

Rich really has only one hobby horse: building strawmen.

efcdons: I can’t tell if you are being obtuse or are actually ignorant.

That’s our Howard!

I think the Labour Party’s current contretemps is a fascinating example of the emerging challenge to “neoliberalism” and the dynamics that ensue. (It might be fun to see JQ, as an Australian, offer an at-a-great-distance dreamer’s analysis of neoliberalism in the time of the cholera Corbyn.)

One cannot escape all of the particular and peculiar details of the British situation: the personality and history of Blair, the faultlines among the three kingdoms, the overwhelming importance of class, and so on, but all that just adds spice to the kidney pie ;-)

I have no stake in British politics, so mine is a pure rooting interest. It is like watching a series of train wrecks: the tracks laid down dictating the inevitability of a collision and wreckage, but motive power is cranked up to drive on in complete obliviousness.

Corbyn’s ordeal is the only reason I look at the terminally neoliberal Guardian and it is as much to see the Guardian embarrass itself as it plunges toward looted oblivion, itself an object lesson in the evils of neoliberalism, as to find out anything concerning latest developments.

One thing that is laid bare in the Corbyn-Labour case is the severe conflict between elite and mass, posed by late neoliberalism. As Rich P and others have pointed out, neoliberalism is peculiar for such a dominant ideology, for not having much about it at this late date that would really qualify as mass or popular appeal, and whatever it may have had in the past is fading fast. Yet, the PLP clings to “electability” as its rallying cry.

Historically, Tory and Whig, Conservative and Liberal reflected divisions among a self-conscious and basically small-c vested-interest conservative elite, while Labour was an eruption from below. The Liberals have never completely gone away and the impulse to re-create the left-centre Party as an elite representation shows itself in the wings constantly. As an architect of his Party, Blair tapped into that potential to draw in a critical margin of electoral support from the professional classes while fashioning the cadre of the PLP to match. And, now the Labour Party is set back to its core electoral base, the loyalty of the ghost of coal and steel, and a PLP led by a former Pfizer rep would rather not represent the underclass or even have to contend with the participation of Party members. Fascinating.

bruce wilder

“Human beings have never let mere ignorance keep them from passionate advocacy. The core of the Christian religion is a fierce politics conducted in full acknowledgement of the complete abandonment of evidence as dispositive.”

True. So the heirs of the enlightenment give up on reason, and the heirs of Marx decide that religion is really the way to go?

The world is complicated. And we can only grope toward the right answer. I don’t think it’s so complicated that we have to throw up our hands and say, “It’s all random.” Yes, it’s a problem when something requires complicated analysis that only experts can do, and you could get ripped off. Take global warming. Do we have to rely on experts? Yes. Should we just say, It’s too complicated; anything can be true! No. It’s unfortunate that people have lost trust in the experts. But that’s not the same as saying we really can’t understand anything. Yes, things have to be negotiated. The CBO model was that those negotiations ought to use a single set of factual assumptions. Remarkably, that model hasn’t broken down yet.

You’re writing at #165. I got back to #137 looking for RichardM and the 300-page policy precis. So please be so kind as to refresh my memory. No, obviously that is not a useful political document. A system that expected voters to read it would be doomed. But somebody needs to understand issues in depth, though it needn’t necessarily be economists. (Forest rangers, soldiers, historians…) And that means there will be experts whom we will have to trust. And other people who can step it down so it’s usable by politicians, and then by the public. I don’t see any way around this.

“Electoral constraints exist, but they exist outside my mind. That I am not Scott Lemieux pontificating on what is politically practical, I generally think, is something in my favor.”

It’s one thing, surely, to think about how things should be without political constraints, and another to criticize a politician for not living in that world. One of the things that always irritated me about Bernie Sanders was his use of what I think of as the “Tinkerbell Theory of Politics”: that if everyone who believes in fairies claps their hands, our program will magically get passed into law. Doesn’t seem to work out that way.

“Peters gets cited because his Neoliberal Manifesto is a particularly clear statement of a certain outlook published at a time when that outlook was becoming prominent if not predominant. And, because the publication he founded with that outlook played an important role in shaping the early careers of some fairly important political opinion writers. The Neoliberal Manifesto argues for the left accepting important aspects of the framework of ideas that animated the Reagan Administration, so even though it didn’t argue for merging with the conservative libertarian right, it did argue for accepting many of their premises and entering into a mutually legitimating policy debate with them; that dialectic is part of what gave neoliberalism the ability to exclude and marginalize others as not expert enough.”

OK, thanks, now I better understand what you’re claiming. I went back and looked at it again. I think we can see the skepticism about teachers’ unions reflected in the Race to the Top. And the emphasis on means-testing everything (misguided, I think) has had an influence on Clinton, as with her criticism of Sanders over free tuition. But to identify this with Thatcherism because of what truly was a coincidental identity of their names (it’s obvious from reading it that he had no idea that there was a European use of the term, if there even was back then) is a big mistake. I really don’t see any of the “framework of ideas that animated the Reagan Administration”. OK, we should remove barriers to entrepreneurship. But nothing about tax cuts, cutting environmental regulation, etc. And nothing about building up the military. Really, it would make discourse a lot more useful if people dropped their attachment to this elaborate construction and we just said what people were saying before all this, that Sanders is left and Clinton is center-left. And less centrist than Bill. The only neoliberals in the US in the European sense are Republicans.

efcdons

“I can’t tell if you are being obtuse or are actually ignorant. You do know the “critique” was written by the Romers I presume.”

Sorry, my bad. I was very tired and had them briefly mixed up with Reinhart and Rogoff.

You misunderstood their critique, though. It wasn’t political; Friedman made a simple technical mistake. Instead of looking at the effect of a one-time increase in government spending, he calculated his results as though government spending kept increasing from year to year. This meant that he was projecting huge increases in GDP and huge reductions in unemployment and poverty. The so-called Gang of Four looked at those results and said no, this is wildly unrealistic. Cue the hysterical denunciations from the Bernistas. It fell to the Romers to get down into the weeds and laboriously figure out where he’d gone wrong. Not the way this sort of thing should work, but a result of the Sanders campaign’s deciding that its #1 enemy was the Democratic Party. To this day there are Bernistas who think he wuz robbed of the nomination.

“Had you seriously not read A Neo-Liberal’s Manifesto this whole time while lecturing everyone else on the meaning of neoliberalism and Peter’s place in American political thought!? What chutzpah!”

This is exactly like saying “Had you seriously not read The Communist Manifesto this whole time while lecturing everyone else on the meaning of Marxism and Marx’s place in political thought!? What chutzpah!”, when spoken by someone who hasn’t read anything else by Marx.

“The liberal bleeds for the criminal, blaming society for his crimes, and concocting exotic legal strategies to help him escape punishment. “(pg.9)

Well, this is curious. Not only does that not sound *at all* like the rest of the essay, but it in fact ISN’T IN the essay I read. It’s hard to imagine Peters using prose like that.What’s your source for this? Here’s mine:

https://www.washingtonpost.com/archive/opinions/1982/09/05/a-neo-liberals-manifesto/21cf41ca-e60e-404e-9a66-124592c9f70d/?utm_term=.083a45b3e427

“Economic growth is most important now. It is essential to almost everything else we want to achieve. Our hero is the risk-taking entrepreneur who creates new jobs and better products. ” (pg. 10)

” Risk is indeed the essence of the movement-the risk of the person who has the different idea in industry or in government. That is why we place such a high value on the entrepreneur” (pg. 17)

OK, how about a little more context?

Our primary concerns are community, democracy, and prosperity. Of them, economic growth is most important now, because it is essential to almost everything else we want to achieve…

We want to encourage the entrepreneur not with Reaganite policies that simply make the rich richer, but with laws designed to help attract investors and customers…
We also favor freeing the entrepreneur from the kind of economic regulation that discourages healthy competition. But on matters of health and safety, we know there must be vigorous regulation, because the same capitalism that can give us economic vitality can also sell us Pintos, maim employes, and pollute our skies and streams.

This is not socialism. But it’s not what the Europeans call neo-liberalism either.

efcdons

Son, you are starting to annoy me. No, I don’t seriously think you make up quotes out of thin air. Did I say you did? Take a pill.

Yes, apparently Peters did say that. Thank you for clearing that up. Thank you also for enabling me to see some context. What he’s doing is a cartoonish caricature of liberal and conservative views about crime. And that *one sentence* is the basis for your assertion that any time a Democratic politician talks about being tough on crime it comes from Peters? Come on. Does he ever even advocate being tough on crime? Does he ever even talk about crime as a problem?

No, you still didn’t understand their critique. Their first point is that the effects he’s estimating are way too big. That’s the point that they explain by showing his mistake. That’s actually all they need. Their second point is that *even if* they were reasonable, there isn’t enough unused capacity to produce those levels of output. If there isn’t enough productive capacity, then their isn’t. Obviously you can add more in the long run, but in the short run you will just get inflation. It’s not like you can tell the Fed not to do anything and everything will be fine. It’s not a political issue; it’s a physical issue. Snarking about fainting couches won’t help. If you look at Friedman’s publications, they’re on the history of the labor movement. He’s not the obvious person to choose to do an analysis like this.

These people are not stupid, and they’re not evil. Nice to think that I could confound the experts by identifying hidden assumptions they’re not aware of, but that’s very unlikely to be true.

I saw an interview where someone confronts him with all this. His first reaction is, “Oops.” Then he starts coming up with rationalizations. He later had something in print saying that R&R were neoclassical, while *he* was a Keynesian. This may have fooled some Bernie people who believed that this was all a huge Clintonite conspiracy. But basically, he goofed, and the people who pointed it out were attacked by furious ignoramuses.

“You’re mighty presumptuous about what other people might and might not have read.”

Perhaps so. Read a lot of other stuff by Peters, have you?

“And coming from a guy who sounds like he glances at a wikipedia entry before commenting it’s a bit much.”

Burn! What gave me away? Was it when I said, “I looked it up in Wikipedia and…” You’re too alert for me.

HF: “people trying to link together things that really had no connection other than the coincidence of names, to invent a philosophy that doesn’t exist, at least in the Democratic Party”

I’ve been over this before, most recently in the blog post linked above. But of all of the criticisms of the use of the word “neoliberalism”, this is probably the silliest.

First there’s the aspect of “how dare you invent a word”. Political words are invented or reused all the time, and there is a pressing need for this one. As with Thomas Frank’s book in which he went through a whole lot of detail describing how contemporary liberals were not like former liberals, it helps to have a shorthand way to express this difference.

Second, it’s not like we’re really inventing this use. The rest of the world uses “neoliberal” in this sense all the time: a few comment threads back I bothered to Google up a couple of peer-reviewed economics and politics papers from Asia and Europe that do so. Leftism has ambitions towards being an international movement and insisting that we can’t use a word as it is used elsewhere is not particularly convincing.

efcdons: “I’d like to get to a point where appointing a pro-growth, inflation-dove Fed chair was as big a deal for a Democratic presidential candidate as appointing Supreme Court justices who will vote to uphold Roe. ”

OMG no. I pretty much agree with all of your comment, but I’m really not looking forwards to years of “We must elect the neoliberal candidate! Don’t you know that two of the Governors on the Fed have the ends of their terms coming up?” Let’s hold our entire political system hostage to the requirement that we get the least evil person into office to appoint the unelected politicians who actually make all of the decisions.

I would like to see some backbone behind cosmopolitanism – some real feeling expressed for this expression of the highest tendencies of human nature.

Tribalism brings much passion, being shaped by fear. But people are also motivated by philia and agape – the love for all, the love for the universal brotherhood. This should be the message of a new cosmopolitanism.

It will be the cosmopolitan attitude that heals the global problems, takes us to the stars, and conquers death.

efcdons @ 177

I read thru your links about Affaire Gerald Friedman. I had read JW Mason’s essay before and the James Galbraith letter to which he linked, but I am not sure I had read that particular piece by Mike Konczal. They reminded me of the extent to which the doctrines and controversies of “neoliberalism” mirror the narrow and myopic dialectic of mainstream economics.

It is really nothing particular to do with the ideology of neoliberalism that we are forced to presuppose, as Howard put it, that “economists know some things that other people don’t.” That’s just the commonplace tyranny of experts in modern life. What produces many of the ideological particulars of “neoliberalism” is the great difficulty economists have in sorting out for public consumption reliable doctrines and intuitions of genuine value distilled from their discipline.

The great blows against neoliberalism as a ruling ideology organizing the politics of policy have been blows against mainstream, neoclassical economics: the failure of most economists to anticipate, or even understand, the GFC of 2008, stands out. But, many observers have noticed that both neoliberalism and conventional macroeconomics seem, for the moment, to have survived unbroken and unbowed by that humiliation. Krugman, notably, wrote a review of Mervyn King’s The End of Alchemy: Money, Banking, and the Future of the Global Economy, which appeared in the New York Review of Books a couple of months ago, in which he defended the adequacy of conventional analysis against the apostacy of former Governor of the Bank of England King’s endorsement of Keynesian “uncertainty”.

The Sanders campaign tried to do what JQ looks for in his OP — “The great opportunity is to present a progressive alternative to the accommodations of soft neoliberalism. The core of such an alternative must be a revival of the egalitarian and activist politics of the postwar social democratic moment . . .” — and used a 75 year old self-described socialist to carry its revivalist banner.

I think you can read the back-and-forth on Gerald Friedman’s attempt to evaluate Sanders’ proposals by the conventional methods of mainstream economists as a bit of boundary policing. On the most basic level, it was nothing more than the petty revenge of the establishment for the earlier humiliation of Reinhart and Rogoff for their infamous spreadsheet error in a paper that tried to prop up austerity by making respectable and conventional the view that high public debt retards economic growth. Scorn for spreadsheet errors is a two-edged sword apparently.

Neither JW Mason nor Mike Konczal occupy an important establishment perch (theirs are very minor ones), but they did an adequate job of pushing back on the idea that Friedman failed fundamentally in his attempt to evaluate Sanders’ proposals by conventional tools of mainstream economics or was unjustified on that basis in concluding that Sanders’ program could work to achieve its intended goals. Paul Krugman, from his perch, predictably attacked Friedman fiercely — that’s worth noting and remembering.

What is hinted at in the controversy — and please correct me if it seems to you like more than a mere hint — is the bankruptcy of the methods themselves.

The conventional view is that the U.S. economy is on a trend line and shocks take the economy down from this trend — that’s a recession — and recovery takes the economy back to the trend line. The trend line represents a kind of long-term equilibrium growth path, a conceptualization supposedly justified by the Solow Growth Model. Good macro policy helps the economy get back to trend faster and more smoothly. I think that outline was clear in Mason’s and Konczal’s accounts.

What troubles me is the extent to which deep fundamental questions are unaddressed by conventional analysis. The economic growth of the Bush recovery from the recession of 2001 that ended with recession in 2007-9 was composed of false growth driven by fraudulent financial practices which not incidentally devastated manufacturing even while driving a housing boom — are we supposed to ignore that? Enormous resources are now concentrated in a parasitic financial sector and in the U.S. a bloated, incredibly expensive health care sector — are we supposed to ignore the implications? The world is confronting global limits on resources, environment and ecology — are we supposed to ignore that?

There are political realities here that aren’t peculiar to neoliberalism, per se. Good policy would drive resources out of the financial sector. If Hillary Clinton realizes that and has resolved to do something about it, no matter how much Goldman Sachs paid her for a private chat over coffee and scones, she wouldn’t warn them. Mervyn King in his retirement, opines that the Euro must go; as Krugman notes in his book review, if he had said something similar as Governor of the Bank of England, it would have sparked a diplomatic crisis if not a worldwide economic crisis. Sanders, bless his black socialist heart, could rail like a good populist should against the banksters only up to a point; he still had to lead with anodyne calls for “growth”. But, it seems to me, that for economics to be socially and politically useful, it has to be less politic than politicians, not more.

It is a commonplace now to acknowledge global warming and the imperative to constrain carbon emissions as the most important issues for the very long-term, but I am not seeing economics do much in terms of realistically integrating that prospect into its routine analysis and prescriptions. The conventional methods, like drawing Solow trend lines with a straightedge and no critical thought, almost seem designed to ignore the implications of having to change the energy basis of the economy and cope with the loss of resources and resource productivity, not to mention come to terms with the implications of population growth and already accomplished expansion of the developed world economy to include China, India and other populous regions.

On Romer & Romer v Gerald Friedman

I don’t think there’s any “dumb mistake” in the dispute between the Romers and Friedman — that’s just not a fair or accurate way to describe what they disagree about.

They have differing worldviews about how the economy works and what is plausible, and neither side has much verifiable expertise. For all the spreadsheet arithmetic being bandied about it, it really does come to subjective assessments with little objective backup or reference.

Many of the key variables in conventional macro thinking are at the very least highly subjective. It is doubtful that the natural rate of unemployment has an objective, factual existence that anyone could measure; ditto for the output gap.

What’s scandalous here is how little useful the economists bring.

“I would like to see some backbone behind cosmopolitanism – some real feeling expressed for this expression of the highest tendencies of human nature.”

I think cosmopolitamism is far more popular and entrenched than most people think, at least in Europe, where mobility across borders (and languages) is a fact of life for significant parts of the population, not just for a tiny elite (as detractors often claim). Diversity in Europe really has increased in the last 20-30 years and most people have no problem with that. Multinational familes are a regular occurrence. Where I live, every fourth citizen, when they marry, marries a person of a different nationality.

Nativist/tribalist movements channelling those who do have a problem with that diversity are politically effective but in most places, they remain clearly in the minority (and they are weakest where diversity is highest). The AFD getting 20% in some German backwater is a political sensation but are they “the voice of the people”? Hardly. Their success reflects the weakness of the conventional parties and their inability to articulate a clear political vision after neoliberalism. Not that the nativists have a vision to offer, though. They don’t have a consistent position to neoliberalism, some are hyper-neoliberals and others are national-capitalist protectionists.

John Quiggin

Thanks. I understood “OP”, but didn’t realize that that was the link you were talking about. So I wondered if there were some OOP that you were referring to.

The essential problem I have with this approach is this: First, it is, indeed, just coincidence that the “hard” and “soft” forms have the same name. I question whether if Peters’s approach had had a different name, it would have occurred to anyone to lump it with what the ROW (Rest of World) calls neoliberalism.

And Peters’s term never really became very popular in the US. So when people talk about neoliberalism, they end up talking about ROW neoliberalism, and then trying to stretch it to cover American Democrats.

ROW neoliberalism is basically a story about global capitalism. Peters had virtually nothing to say about this, apart from some praise for entrepreneurs and economic growth. That being the case, one must fall back on the positions of politicians to define US neoliberalism. Which in practice means the positions of everyone except Bernie Sanders.

But then we must ask, what is “neo-” about this? Why isn’t this just (US-style) “liberalism”? Moderate support for international trade has been a liberal position going back at least to Adlai Stevenson.

In particular, there’s a focus on Mrs. Clinton as the arch-neoliberal. But she is well to the left of the average Democratic senator. At the Nevada Democratic caucuses Barbara Boxer was shouted down and called a “neolib bitch” for supporting Clinton, even though Boxer is among the leftmost 10% of the US Senate. And then there’s Paul Krugman, who has been one of the loudest voices against the right for the last 20 years, but is now a neoliberal because he not only supported Clinton, but didn’t go along with some utterly ridiculous claims of Bernie supporters.

If you want to lump together the non-socialist 90% of the US political spectrum as an analytic convenience, you’re free to do so. But there’s really nothing neo- about it.

bruce wilder

I don’t think so. Here’s Friedman’s abbreviated CV:

https://www.umass.edu/economics/friedman

He’s not a guy who has any experience with stuff like this, and he probably hasn’t done any macro since his qualifying exams in grad school. Some macroeconomists came to his defense when the letter from the four former heads of the CEA first came out, explaining how claims like his might be right. In particular, James Galbraith claimed that he was using standard methodology. Then Romer and Romer’s more through analysis came out, explaining why his claims were implausible, and suggesting that he had made a fairly elementary mistake. (I don’t say I wouldn’t have made it, but I don’t have a Ph.D. in economics and wouldn’t have attempted it in the first place.) At that point, he started claiming that he was just taking a whole different approach, that the CEA people were taking a “classical” or “neoclassical” approach, while he was taking a “Keynesian” approach. I haven’t heard any serious economists defend his estimates since. (I just did a quick Google search on “Quiggin Friedman” and turned up only Milton and Thomas.)

What’s depressing about this episode is that the Sanders crowd was unable to accept it as a difference of opinion capable of resolution, and immediately, egged on by some Sanders surrogates, started attacking the ex-CEA people as the “Gang of Four” who were conspiring to help Clinton.

Howard, the essential problem with your approach is that US exists in the context of the “ROW”, and especially in today’s global capitalist world system, one simply can’t understand the US in any meaningful way if one mechanistically cleaves it off from one’s understanding of the “ROW”. Yes, we assume the phenomenon we call neoliberalism doesn’t stop existing as soon as it meets a US Customs and Border Patrol agent, just like we assume the same of a map in kilometers or a thermometer in Celsius. We assume on some level that using the same political/economic terms globally to analyze global political/economic phenomena will aid us in our understanding, just like using the same systems of measurement globally will aid a Mars satellite in not crashing. In some cases, the idiosyncratic way a particular group of people treats a common term will be a greater hindrance than help to their own ability to understand or function within a broader context, and abandoning their idiosyncratic usage will ultimately at some point be necessary. In some cases the group of people who have to abandon their idiosyncratic usage may even include Americans! If we’re trying to engage in a project of universal intellectual life, we have to assume this is just the way things work.

Of course this is being charitable and assuming that there actually are two distinct understandings of “neoliberalism”, a neoliberalism-USA briefly adopted by Peters more or less as a synonym for “members of the present-day Democratic Party” before being forgotten, and a neoliberalism-ROW used frequently in various branches of social science around the world to comprehend a global political/economic phenomenon. But that’s not what you initially argued: you initially argued that “the term ‘neoliberalism’ is a virus that devastates the analytic functions of the brain”, and your reasoning for this seems to be that any ideological project comprising all or almost all of mainstream electoral politics in the US can’t possibly be meaningful or specific enough to warrant its own name or be analyzed as its own trend. If something like an anti-neoliberal mass politics doesn’t exist in the USA, or at least doesn’t exist in our mainstream electoral politics, then not only is it not worth Americans ever talking or even so much as thinking about, it’s actually a “virus” worth actively avoiding ever talking or thinking about, never mind one’s own ability to understand the broader world and never mind what one might call “a decent respect to the opinions of mankind”. For Christ’s sake, man, you’re guzzling 150-proof essence of provincialism straight from the bottle.

RP: yes, the contemporary U.S. center-left is very much part of what you’re calling ROW neoliberalism

Yes, and this is what Howard Frant has been resisting mightily: that the center-left in the U.S. took a turn in the early 1980s that has led it to become more conservative on economics (i.e. more pro-capitalist, less supportive of labor, less interested in government as a source of countervailing power against business).

The contretemps, Gerald Friedman v Romer & Romer, well illustrates the problem with 21st century American neoliberalism, which is now whole-world neoliberalism. American neoliberalism is no longer distinct from global neoliberalism.

Christina Romer’s outlook on macroeconomic issues would not be easy to distinguish from that of, say, Olivier Blanchard, the MIT economist and French citizen who has until recently been prominent as IMF chief economist (where, yes, it was his literal duty to tell Greece, “there is no alternative”). Although a New Keynesian (as most American mainstream macroeconomists are), Romer’s work generally takes slants friendly toward the prejudices of more right-wing economists (I suppose politically “hard” neoliberals in JQ’s typology). This is pretty typical of a pattern among economists in which a narrow range of neoliberal opinion reinforces reputation, while those outside that range are scorned and libeled as Romer libeled Friedman by falsely characterizing a difference of opinion as Friedman’s unprofessional error.

187: “cosmopolitanism – . . . this expression of the highest tendencies of human nature” – For the record, I wouldn’t use that kind of rhetoric. But I do hold that cosmopolitanism is a good not a bad thing and it’s not coincidental that the rejection of cosmopolitanism is historically associated with the lowest tendencies of human nature, i. e. fascism.

bruce wilder

For crying out loud, Friedman made a mistake and he got caught. He is an economic historian who had no experience in macroeconomics, be it ever so far outside the mainstream. Before he was caught, his defenders claimed that he was using standard assumptions. After he was caught, he said, almost literally, Oops (I saw the interview), but then made up this whole story about how he was just using non-standard assumptions. This was sufficient to convince a lot of people who wanted to believe (a) that Bernie could deliver an economic growth rate that had never been seen in history (b) that those mean old economists were a bunch of neoliberal “experts” who were just interested in protecting their own privileges, like climate scientists, no wait. But no, he didn’t suddenly emerge from writing about labor militancy at the turn of the 20th century with a new theory of macroeconomics. The only people who got libeled were the Gang of Four and Paul Krugman, who were subjected to a ridiculous amount of abuse from people who didn’t know what they were talking about.

And Bob, you will notice how often they use quotes from holy scriptures of one kind or another (just like “Austrian” economic believers), perhaps because empirical verification is missing only appeal to authority counts.

bruce wilder

So you really see no distinction between being a macroeconomic historian and being a historian of the labor movement when it comes to making macroeconomic forecasts?

BTW, I understand that Romer’s original estimate of the needed stimulus after the crash was 1.8 trillion. What we got was 0.8 trillion.

So now the output of the entire CEA is hackwork, and something a labor historian did by himself is serious? That seems a bit harsh.

I don’t know that Krugman explained the mistake all that well. But here he is in his blog, just quoting directly from Romer and Romer:

“We have a conjecture about how Friedman may have incorrectly found such large effects. Suppose one is considering a permanent increase in government spending of 1% of GDP, and suppose one assumes that government spending raises output one-for-one. Then one might be tempted to think that the program would raise output growth each year by a percentage point, and so raise the level of output after a decade by about 10%. In fact, however, in this scenario there is no additional stimulus after the first year. As a result, each year the spending would raise the level of output by 1% relative to what it would have been otherwise, and so the impact on the level of output after a decade would be only 1%.”

Krugman comments: “Oh, dear.” I think his later comments about going up and going down were needlessly confusing.

My question about “soft” neoliberalism is not whether it “exists”, but whether it’s a useful construct. Frankly, it mainly strikes me as more useful for insult-flinging at people who don’t support Bernie Sanders than it is for analysis and clear thinking. Take the Queen of the Night, Arch Neoliberal Hillary Clinton. If soft neoliberalism stands for anything, it’s surely a turning away from unions– Peters has flamboyantly little patience with them. Yet Clinton has a mind-numbing list of union endorsements: the UAW, the plumbers and pipefitters, AFSCME, SIEU, and on and on. Peters wants big educational reforms that would give less power to unions, yet Clinton is supported by both the AFT and the NEA. Evidently a soft neoliberal favors increasing the minimum wage by only 65%. (No reason to think that there might be any problem with more than doubling it, so why not? Just anti-worker not to.)

Or take Paul Krugman. One of a very small number of pundits who opposed the invasion of Iraq. Consistent voice against deficit-reduction hysteria; used simple mathematical models to argue that deficits now wouldn’t raise interest rates. Said from the beginning that the Obama stimulus was too small. Argued long and loud against what the EU was doing to Greece, and in general against austerity in Europe. But he supports Hillary and Christina Romer, so screw him, the arrogant neoliberal technocrat.

In general, it seems to me that with soft neoliberalism, you start with the person and then jiggle the definition to make it fit. Tough regulation of the financial services industry that cuts into the profits of banks and leads to a rain of lobbyists on Capitol Hill? No, that’s Hillary, so it’s neoliberal.

I also think an excessive focus on neoliberalism as the skeleton key to politics ends up with an impoverished view of motivations. For example, Clinton’s early work on the TPP as Secretary of State probably had a lot to do with an interest in providing a counterweight to China in East Asia, and relatively little to do with serving as handmaiden to global capitalism (just as her support for fracking as Secretary of State probably had a lot to do with Russia’s exploiting its position as a monopoly supplier of natural gas to Europe, and very little to do with anticipated future contributions from the fossil fuel industry).

I agree, we shouldn’t care too much about politicians’ motivations.

So whose side is Paul Krugman on? And what’s your evidence? It would be nice to have some before you brand him with the Mark of Shame. Or am I right in thinking that a neoliberal is any Democrat who wasn’t a supporter of Bernie?

He’s mildly against TPP by the way. And I think that probably the effect of TPP will be very small. But what do I know?

“is to alert people to whose side Paul Krugman or Hillary Clinton are actually on”

I’m curious too, whose side is Krugman “actually” on and how does it show in his writings? I remember Krugman’s almost alone in the mainstream media not only opposing the Iraq war but also writing tirelessly about the failings of the US health care system, about rising inequality, about the real estate bubble, the Bush tax cuts, lack of infrastructure spending, austerity, and so on. And yes, he’s not a supporter of TPP. If you insist on lumping him in with the dark side, the usefulness of your analytical categories seems indeed questionable.

Bruce,
you sometimes should remember that the perfect is the enemy of the good.

I’ll add to Will G-R’s comment above — which seems to me to be basically correct — that I think the New Deal liberalism bit is fairly sympathetic. Liberalism with the consciousness that it’s in a continual struggle against the slide down into elite takeover and predation can be justified as the best alternative if your risk tolerance is low, because left solutions have historically run a very high risk of either destabilizing society and leaving it open to right-wing takeover or of ending up with a left statism that is worse than liberal society. But it’s only justifiable if the liberals in question actually are conscious of what they are doing and the problems involved. If people think that the function of a liberal is to defend liberal elites as the slide continues instead of struggling to replace them and change the system, they are actively part of the problem.

But thanks for pointing out that Krugman isn’t anti-capital. The cadres of anti-capitalist revolution should take note (I’m sure they have already, all six of them).

Rich, of course the problem is that if the sympathetic liberals you describe are fully conscious of what they’re doing, they risk no longer being liberals at all. Listen to one of Yanis Varoufakis’ more candid lectures for a good example, he says outright that I consider myself a Marxist but I’ll work to preserve Keynesian liberal solutions for now because the means of production aren’t yet ready for socialism and the anticapitalist left isn’t ready to take over. The way Varoufakis gets characterized as some unthinkably crazy radical not even so much for his opportunistically Marxist stated motivations as for daring to propose a fully-fledged Keynesian agenda at all — even his wildest, most starry-eyed proposals for Greek public spending and public debt would have been utterly mild by Western standards of the ’50s and ’60s — is just further evidence that neoliberalism has lost its collective mind.

Reason, go look for your procapitalist safe space somewhere else.

Will G-R
You probably won’t understand, but I don’t divide the world into the narrow and distinct classes that you do.

John Quiggin

I’ve been struggling (all this time) to figure out what people on the American left mean when they call people like Barbara Boxer “neoliberals”. From the above discussion, it appears that they mean non-Marxist, which I guess would fit into your three-party system if we drop the “old-style US liberals” and are agnostic on greens and feminists.

Unfortunately, “non-Marxist” is not a very useful classification in US politics. So are there still some old-style US liberals left? Can you give some examples?

Here’s the nub of the issue: Suppose Clinton repents of her apostasy, and says, “I want to go back to old-style liberalism.” What would she have to do? What policy positions would she have to change?

Note that old-style US liberalism is not automatically opposed to all trade agreements. Note also that running against Sanders, she got a large majority of union endorsements.

In an earlier thread, when asked for examples particularly of left neoliberalism, I named Brad DeLong, who then stepped into the discussion to confirm the label. Krugman probably wouldn’t embrace the label, but there are rarely glimmers of daylight between Krugman and DeLong on economic issues.

Howard Frant has made the point repeatedly that we are in danger with the label, neoliberal, of applying it to whomever we don’t like with no discrimination, and here is proof in reverse: Krugman cannot be a neoliberal, because “neoliberal” is a pejorative and we like Krugman, Krugman has been a good guy.

My scorn for neoliberalism notwithstanding, I do not want to use the label as an empty pejorative, stripping away any analytic content. I want the label to help people see how ideas matter in politics and that requires seeing the dynamics and recalling some history. The label is essential to seeing how neoliberalism as framework of ideas and conventions for discussing and developing those ideas has driven policy toward policy’s logical consequences, over time.

For me, a key part of the dynamics of neoliberalism is the dialectic that developed between what JQ has called hard and soft neoliberalism, a dialectic that has threatened to leave democratic politics without even the possibility of thinking of alternatives. “There is no alternative” is no joke and in the struggles of partisan politics, neoliberalism helped to form the lesser evil ratchet that gave the Democrats, the neoliberal Obama followed presumably by Hillary Clinton. If people think Hillary Clinton is just another liberal with particularly high speaking fees, they are missing something essential.

As an aside, let me say that Howard has a point when he notes that Bill Clinton was threading the needle with his Third Way to find a path to electability back in the day, just as Blair and Brown were political entrepreneurs finding a way to take Labour past Thatcherism. Political anacyclosis is driven by serial autocorrelation in the evolution of society and the political economy. Never underestimate the driving force of opportunism; “successful” ideas are as likely to be apologies and rationalizations as inspirations.

That said, the political circus proceeds to feature the ideas available and neoliberalism as manifested in American politics arose from a peculiar turn in academic economics that took place in the 1970s. Krugman has written with great passion about his dissatisfaction with the divide between fresh water and salt water and he himself is one of a surprisingly narrow faction of elite economists who came out of MIT, where Samuelson and Solow formed a hard point of resistance to the New Classical and Real Business Cycle movements that inherited the wind of Friedman’s Chicago School reinforced with the anti-state rhetoric of the Virginia School of Public Choice political economy.

I am talking about policy economics, not all of academic economics which is a vast field, though policy economics is its politically most prominent part. (I am not going to take on the sociology of American economics, but I will note that a tightly networked minority of rigidly ideological right-wing bully boys has an outsized influence on the reputation hierarchy and the policing of boundaries; I alluded to the way Christina Romer has catered to these aholes and how it has shaped the narrative interpretation of her work upthread; the treatment of David Card and his research on minimum wage is notorious but not exceptional.) The leading practitioners of policy economics, which is primarily a business of public preaching, take theoretical macroeconomics on as their theology and there was a revolution in theoretical macroeconomics in the 1970s. In that revolution, pretty much the whole left arm and leg of American policy economics was amputated, buried and forgotten — and those who couldn’t be completely silenced were marginalized.

I don’t think one can exaggerate how severe this narrowing was. The leading American left public intellectual of the 1950s and 1960s — John Kenneth Galbraith — was the last prophet of the institutionalism that provided the technocratic rationales for the Progressive Era’s and the New Deal’s creation of new agencies of government. Institutionalism disappeared completely on the left, with only fairly extreme conservative public choice folks and ciphers like Oliver Williamson laboring on in that field. Most of the 20 or so leading economics departments in the 1960s would have had a Marxist or a “Marxicologist” on the faculty; that ended quickly by the end of the 1970s. The Kennedy-Johnson Council of Economic Advisors was a stellar cast of Keynesians, each a prominent academic at a leading university — typically, a leading public university; they would have no legacy. The intellectual euthanasia of American Keynesianism in the neoclassical synthesis was accomplished in small poisonous doses, many of them administered by Samuelson and Solow before Milton Friedman came with the coup de grâce: his “prediction” and interpretation of stagflation. Solow’s embrace of a stunningly naïve interpretation of the Phillips Curve was an essential part of the setup for Friedman’s performance.

For the esoterically minded, the Cambridge Capital Controversy stands as another marker in the peculiar truncation of everything to the left of Samuelson and Solow. And, of course, there’s a whole complex story about how academic positions and research is financed and the proliferation of right-wing think tanks and foundation money played its role. (I am writing a blog comment, not a treatise.)

Krugman and Stiglitz (and, of course, a whole bunch of others) became the left pole of American academic policy economics for their generation. In their own narratives, of course, they claimed the left pole in rebellion against the consensus stupidity and ill-will of more right-wing or complacent economists: Stiglitz most notably in his acerbic criticism of the hypocrisy of the Washington Consensus as practiced and Krugman in his protests against the misinterpretation of Japan’s bright depression and the enthusiasm of the Bush Administration for irresponsible financial deregulation.

A different narrative, though, says they became the left pole, because the rest of the axis to their left was sawn off and discarded. In light of that narrative, you can notice the extent to which they maintain their status as the left pole, by facing right and choosing to engage primarily with conservative libertarian interlocutors, while turning their backs to and contributing to the marginalization of figures to their own left. Brad DeLong or Mark Thoma loves to revive fond memories of Milton Friedman, they would love to engage with Greg Mankiw and are like sugar addicts around the trolling of Tyler Cowen. But, Minsky? Well, Minsky never had a model, you see.

If you ask Stiglitz about the Euro, he will tell you it was a bad idea and ought to be reformed — which makes him sound like a good go-to guy for the imprimatur of economic authority, if your politics makes you horrified by what has been done to Spain or Greece. But, if you press him for an explanation, he will invoke “optimal currency areas” and Bob Mundell. Mundell is to the right of Attila the Hun — that’s who Stiglitz is legitimating. Mundell inspired and even advocated many of the key neoliberal ideals that made the Euro a strait-jacket on government; the iconic Mundell–Fleming model, an extension of the IS / LM idea Krugman loves so much, is an insight into a policy trilemma that promised that fixed exchange rates and free capital movements would require disabling fiscal and monetary policy — a desirable result if your ultimate goal is to destroy the social-welfare state and a key architectural principle for the Euro. Stiglitz is unlikely to point you to Wynne Godley, whose monetary theories are admirably clear and intuitively accessible and whose analysis of the Euro’s defects focused on the hazards of incapacitating government.

I don’t think Krugman is a bad guy. This is not about Krugman’s personal character. My own personal political center of gravity cum desiderata is pretty close to Krugman’s I think. Certainly, I have no sympathy for Marxism and not much for full-blown socialism of monolithic state-owned industry et cetera.

What I am trying to get across is that if all you read in placing him on the political spectrum is his personal moral or ethical commitments, his self-presentation as a reasonable fellow, you miss some things that are critical to where he will predictably be as a policy (and personnel) critic and advocate, things that will make him an unreliable narrator and advocate for the left.

One is that he’s uncomfortable with the idea that there is anyone respectable to his left. This is a big problem generally with the left neoliberals and has contributed to a self-defeating dynamic for the left generally that has brought us to this present pass where it is necessary to reject neoliberalism wholesale. All the inevitable compromises for Krugman are to his right. He rarely exhibits the savagery of a DeLong in response to a challenge from his left, but he’s pretty effective in maintaining the boundary with arrogant ignorance and condescension. Keeping the mainstream dialectic exclusively with the left neoliberal’s right is how left or soft neoliberalism keeps neoliberalism dominant and even exclusive.

And, if you are looking to Krugman for a trustworthy narrative of the more esoteric policy debates and personnel choices, you are going to get it sometimes, but not always reliably. He’ll call Barro bone-headed, sure, but he would never identify Bernanke’s political worldview accurately or Bernanke’s policy outlook — he probably doesn’t understand how right-wing Bernanke is, given how soft-spoken Bernanke is and the fatherly role Bernanke played in furthering Krugman’s career, so I am not saying he’s deliberately deceiving anyone. But, he will be deceiving people, who expect more than he can give.

If Krugman casts his eye on Greece’s predicament, he’s going to give us his conservative economist’s view, which is that Greece must adjust its price-level to an equilibrium level that balances trade and capital flows. This leads to a conventional interpretation of Troika policy that largely misses the microeconomic institutional “reform” agenda of breaking the institutions of the social-welfare-state not to mention the looting. Instead, he praises his friend and former MIT colleague, Olivier Blanchard for Blanchard’s wholly ineffectual concessions that austerity has not worked out as well as, with the best of intentions, all may have hoped.

I don’t think this criticism is a case of making the perfect the enemy of the good. I am saying the political conversation is systematically distorted by the way left or soft neoliberals face right and deprecate or marginalize those to their left. I am not saying that I think political perfection lies to Krugman’s left. What I personally would judge as a pretty good middle ground probably lies in Krugman’s vicinity; what I am saying is that Krugman cannot get us to Krugman’s vicinity as long as he plays this neoliberal game where he legitimates only those people and views that are to his right. His self-flanking of the left is why neoliberalism has to go, has to be de-legitimated as a whole if we are going to escape this dynamic.

Howard: I’ve been struggling (all this time) to figure out what people on the American left mean when they call people like Barbara Boxer “neoliberals”. From the above discussion, it appears that they mean non-Marxist

I’m not sure how you figure that… it seems pretty clear from Rich’s and my discussion above that we’re contrasting neoliberalism to New Deal-era Keynesian welfare liberalism. I’ll accept Krugman as a borderline example since his stated agenda is pretty much a return to Keynes in a globalized world order, but what he avoids grappling with is the massive shift in global political mechanisms that would have to happen before such an agenda could ever come to pass. If one accepts the neoliberal governance model of IMF structual adjustment programs and ISDS tribunal rulings and so on, in practice one basically has two possible stances toward welfare-state programs, either leaving them alone or dismantling them; there’s no feasible way to use these tools to actually build a welfare state without riding some new wave of mass politicization on a global scale, and the most Krugman and people like him really have to say about this is a vague Picardian “make it so”. It’s the same problem as the global wealth tax from Piketty’s Capital in the Twenty-First Century (which strikes me as a pretty perfect neoliberal-era analogue of Henry George’s Progress and Poverty with its land value tax) — as Žižek points out, if we had the kinds of institutions that could actually implement such a tax, we would have already won the battle!

I guess the point is that there aren’t any truly old-style welfare liberals left in mainstream politics and there really couldn’t be, except in the sense that the people who still go around declaring themselves heirs to the House of Bourbon or whatever are still old-style feudal monarchs: because they have no hope of gaining power in an institutional climate that’s long since moved on, they’re playing a fundamentally different role than the people from back in the day who used to believe as they did but who were in power. Bernie Sanders as the US Senate’s resident ineffectual social-democratic curmudgeon might be a good example, although I do hear that his commitment to socialism as opposed to liberalism was somewhat deeper before he pursued elected office. But why these people ultimately belong to the neoliberal ideological order is the way they urge their readers/followers to frame their political engagement within institutions thoroughly calibrated to produce neoliberal policy outcomes, particularly the ever more Potemkin-like facade of working-class representation in nation-state electoral politics. This says more about their real role than any hopeless revanchist proposals for renewed national welfare states ever could.

(As an aside, in that Sanders interview clip I linked to at #151, part of me can’t help but feel sorry for Bernie at around 40-45 seconds. In my headcanon anyway, that little stumble at “then you’re doing away with the concept of a nation-state, and I don’t think there’s any country in the world… which believes… in that” is the moment when he’s thinking to himself, “aw crap, now I’m shitting on immigrants, guess I sold out and I’m not a real socialist anymore, I’m just a liberal”. But then again he probably justifies it to himself better than I could or would.)

Will G-R
You also misunderstand that I am not looking for a safe space – you can write what you like, it is just that I and others can choose to ignore it and I’m recommending that approach as the more constructive.

Me, I’m never looking for an ideal solution, I just want to move in the right direction no the wrong direction. The idea that we trample hard on lots of people in order to head for something we just know must be better is anathema to me.

soru: “liberal: believes aspects of socialist thought to be pragmatically correct but morally reprehensible”

That seems to me to be exactly backwards. If you look at the broad arc of center-leftism in the West over the 20th century, liberals never rejected the ideals of socialism. (And no, “central planning” is not an ideal of socialism, nor does Stalinism embody those ideals.) Socialism had an increasing series of pragmatic failures. Even neoliberals have — in theory — a commitment to fairness, equality, progress, and community control that still puts them on the left where the left/right axis is defined in relation to socialism. I don’t think that you can understand neoliberalism if you can’t understand how neoliberals can be, in their own external and self-justifications, working towards these things.

A good amount of the confusion is because of the heritage of Marx. If you read Marx on rival socialisms, he scornfully dismisses them, but history pretty much had the opposite judgement. Marx essentially had no political theory on how community control was supposed to happen and not be taken over by a new class elite, other than a theory of class interest that was flatly wrong.

Addendum: that applies to left liberals of course, not to economic liberals like Hayek, and it may apply more in Europe than the US. As a data point here let me offer the platform of the German centrist party CDU, which declared in 1947 that capitalism had failed and the economy needed to be fundamentally restructured, oriented towards the common good instead of capitalistic profitability. That view probably expresses a broad political consensus in postwar Europe (https://de.wikipedia.org/wiki/Ahlener_Programm)

Also note that the European postwar is often referred to as a social democratic era but in reality, social democratic parties were only in power in some countries and mostly only for short periods. In Germany, only from 1969 to 1982. What we refer to as the “Social democratic welfare state” was mostly implemented by centrist and conservative governments.

Well, I had some general comments aboutDeLong, and responses to Will G-R, Sam Chevre, and bruce wilder, but when I hit Submit it disappeared. Hope it turns up, as I am a very slow typist.