The arrival of the Tony Abbott-led Liberal National Party (LNP) government in Australia means the ideology of neoliberalism is once again to the fore. Neoliberalism is the dominant ideological matrix of our age, having insinuated itself into the global ‘common sense’. It is the driving ideological force behind the now familiar government (of all shades) focus in recent decades on marketization, privatization, and deregulation. Although the Labor party has absorbed quite a bit of neoliberal thinking, there is no doubt the new LNP government is moving much further to the right (even more so that the earlier Howard government) and endeavouring to implement a far bigger chunk of the neoliberal program. Fairly obviously, neoliberalism is in the interests of private capital by providing a legitimating discourse for business interests to operate with a minimum of scrutiny and a maximum of scope.
Yet despite the undoubted power of neoliberalism as a set of ideas and promotional institutions (think tanks such as the Institute of Public Affairs, the Murdoch press etc), and despite its ideological utility for the transnational ruling elites, it is not unassailable and it is far from having universal or even popular support. Although neoliberals may get some mileage from ridiculing the functions of government through rhetorical phrases such as the nanny state, governmental waste etc, there appears to be only lukewarm public support in Australia for typical neoliberal measures such as privatization, outsourcing of government functions, and perpetual ‘efficiency audits’ within government supposedly to cut waste and ‘red and green tape’. People have learned through experience that these are often code words for reduced quality of services, a degraded environment, job losses, higher prices and cutbacks – along with fat fees to bankers and consultants – all under the rubric of ‘freedom of choice’ that in fact generates greater uncertainty and anxiety for the ‘consumers’ of the newly privatized or rationalized services.
Thus neoliberalism is not a ‘dominant ideology’ in the sense that the whole of general populace is brainwashed by it (see Terry Flew, Six theories of neoliberalism); rather is a loosely connected set of theories, policy programs and campaigns which are focused on gaining state power for the benefit of significant sections of the elites (‘transnational ruling class’). Neoliberalism is not monolithic, and its program is not necessarily broadly accepted or even understood. Nor is neoliberalism even totally ‘evil’ — it has theoretical elements which are worthy of debate and reflection. But it is my contention that what is of concern is that the neoliberal program is not only extreme in that it posits markets and economization as the ‘solution’ for virtually every domain of life, but also because it is based on a flawed conception of human nature which must of necessity translate into a flawed vision of human flourishing.
The core assumption of neoliberalism is that all individuals can and should be treated as homo economicus – as economic agents who make all decisions on the basis of a calculating self-interest and a calculable set of costs and benefits. Moreover neoliberalism posits that this calculating, incentives-based reasoning should be applied to organizing virtually all areas of social life – whether through expansion of markets and privatization, or increasingly, through application of incentive-based modes of economization within the activities of government itself (for example the proposed Medicare co-payment).
It is time to name neoliberalism as having evolved into an extremist program to wind back public institutions and any redistributive programs that seek even a modicum of levelling in the increasing wealth disparities in Australia and globally. Once the neoliberal program is brought to light, so too do the strategies and sub-texts behind various LNP decisions and policies. We need to use neoliberalism not simply as a term of denunciation of excessive marketization and privatisation etc, but also as a possible source of explanation for particular policy directions – as a method to identify patterns in government actions. Ideas can have real, material consequences. We need to understand the particular logic of neoliberal thinking and the institutional sources from whence it comes. Neoliberalism has become an increasingly extreme push for ‘marketisation of everything’ – but paradoxically its increasing extremism is at a time of growing inequalities of wealth and a hardening of political mood against seemingly endless efforts to plunder public resources and transfer them to private hands.
The neo in neoliberalism refers to the way it goes beyond a simple laissez faire or hands-off approach to the operation of markets as per classical liberalism, and instead seeks to gain hands-on control of the state apparatus in order to actively extend and impose markets on ever-more domains of social life. Thus the neoliberal interest in ‘small government’ is somewhat misleading: it in fact seeks greater control over government by the right kind of people with the supposedly correct ideas to ensure that markets can expand and thrive. They don’t mind government so long as they are in control of it.
The origins of neoliberalism go back at least to the 1930s and to theoretical debates about the feasibility of central economic planning and in response to actual Soviet totalitarian repression. In practice it began as movement of a group of intellectuals seeking to counter the rise of Keynesian and New Deal policies that basically sought an accommodation between capital and labour by means of an expanded welfare state. Neoliberalism, through the establishment of the Mont Pelerin Society (1949) and the Neoliberal Thought Collective, mounted an effective and sustained quasi-Leninist campaign of agenda-setting and issue framing, through a complex series of ‘Russian doll’ think tanks which sought influence within policy and media circles in the English-speaking countries in particular (for example in Australia, the Centre for Independent Studies and the Institute of Public Affairs). From the 1970s onwards neoliberalism began to establish a firm foothold from which to unwind the welfare state in the developed (particularly Anglo) world, as well to mould and exploit the social, political and economic conditions in developing nations for the benefit of private capital (eg Chile).
An interesting recent critical perspective on neoliberalism, entitled Neoliberal reason and its forms: Depoliticization through economization,” is offered by Yahya Madra and Fikret Adaman, building upon the pioneering work of Michel Foucault. Madra and Adaman’s paper defines neoliberalism as an ‘interdiscursive horizon’ which accommodates a range of loosely connected theoretical positions. But these positions share two important features:
- An assumption that all individuals can and should be treated as homo economicus – as economic agents who make all decisions on the basis of a calculating self-interest and a calculable set of costs and benefits.
- A view that this calculating, incentives-based reasoning should be applied to organizing virtually all areas of social life – whether through expansion of markets and privatization, or increasingly, through application of incentive-based modes of economization within the activities of government itself. These latter, so-called ‘post market’ methods of governmental action apply the same underlying neoliberal assumptions about human motivations to the design regulatory instruments.
The outcome of the above two neoliberal trends is ongoing depoliticisation of social and ecological issues, in the sense that the solutions proposed are couched in terms of incentives-based structures (eg markets) which depend on the assumption that humans act only in the mode of homo economicus. Gone is the possibility that people also act for other-regarding reasons, for the sake of principles or for collective benefit. The idea that politics might be a mode of action where such issues can be hammered out and institutions created which might guide human behaviour in other ways – is actively disparaged in favour of market- and incentive-based modes that assume people internalise the expectation that they will respond to economic incentives in a calculating, self-interested and predictable manner.
In a nutshell, neoliberalism assumes and actively works to create an impoverished vision of human nature in which we are no more than self-gratifying consumer robots, extending our robot-like ways to ever-wider fields of social life.
In all of this there is not only the question of the impoverished vision of human nature, but more pragmatically, the question of its effectiveness in the face of the momentous social and ecological challenges which humanity faces. It is by no means self-evident that the somewhat dreary and predictable modes of self-interested, incentives-based action will, on their own, be sufficient to motivate people to make the major adaptations and creative responses that are required.
In Australia the implementation of neoliberal policies began in the 1980s with, for example, the Labor government’s deregulation of the dollar and the privatization of Qantas. However, because these were implemented by a middle of the road Labor government which had a commitment to values of fairness and compassion, the harsh underside of neoliberal thinking did not really come to the fore. Similarly even during the Howard years of LNP government, their policies were more guided by pragmatism rather than strict neoliberal dogma, and the fact of governing during a long economic boom made it easier to gain lower-middle class support by means of ‘buying votes’ through tax cuts and generous middle class welfare payments. The neoliberal think tanks played a useful supporting role during this time by fanning ‘culture wars’ to attack marginalized groups such as Aborigines and by attempting to de-legitimate alleged ‘special interests’, such as the environmental movement, which got in the way of the neoliberal agenda.
As Chris Gibson observes, Australia’s traditions of fairness and egalitarianism, along with a focus on a strong role for the state in nation building and development of regional equality over a vast geographical area, have played a role in ‘muting’ the realisation of the neoliberal agenda in this country.
Canada, in many ways a comparable country to Australia (but often ignored in the shadow of its larger neighbour the USA), underwent a similar pattern of neoliberal transformation beginning in the 1980s with the North America Free Trade Agreement (NAFTA). However Canada’s neoliberal path took a turn towards considerable pugnacity with the election of the Harper Conservative government in 2005. Tony Abbott is a great admirer of Harper, and Canada, with its similar staples/minerals based economy, stands as an exemplary warning to Australia as to what lies ahead if we do not curtail the Abbott experiment.
Following the Global Financial Crisis some thought that this would be the death knell for neoliberalism. In actuality neoliberalism has doubled down and is more assertive and ubiquitous than ever. This counter-intuitive result is discussed at length and with great wit in Phillip Mirowski’s book Never Let a Good Crisis Go to Waste.
However, although neoliberalism survives Godzilla-like from the wreckage of the GFC, the conditions in which it operates are more challenging. Even in the relatively unscathed Australia, there is no longer the buoyant growth of pre-GFC times, and only luke-warm electoral support for standard neoliberal ploys such as privatisation and outsourcing of government functions.
This brings us to the Abbott LNP government which finds itself operating, unlike the Howard government, in an economic down-cycle (of indeterminate length) and an electorate which seems to have a shorter fuse after the GFC and the political volatility of the Rudd-Gillard years. Despite this, Abbott has proceeded with a hard right agenda (unannounced prior to the election, although hardly unexpected) and has aligned himself closely with the IPA by visiting the Institute and implementing a number of policy items on the IPA wish-list. One suspects that the LNP is endeavouring to mount one more push to restructure major components of the Australian commonwealth (and its historical achievements in areas of universal healthcare, education and environmental protection) in order to discipline the lower classes and enable transnational capital to plunder an even greater share of the country’s wealth.
To that end we see a number of strategies come into play:
– A range of highly partisan appointments to key agencies and cultural institutions, for example Janet Albrehtson and Noel Brown to the ABC board, Tim Wilson to the Human Rights Commission, etc. Yes all governments tend to appoint their own, but under Rudd-Gillard it was nothing like this. Even a pretence of bipartisanship has gone out the window. This could partly be sheer bloody-mindedness, but it may also be, as Guy Rundle has suggested, a deliberate neoliberal ‘wrecking ball’ strategy to make governance appear disputatious and unworkable, thereby further de-legitimating government-backed institutions in the eyes of the electorate.
– A budget which overwhelmingly targets the lower classes and introduces additional market discipline in higher education and health. The negative public reaction to this has been in one sense quite astounding, but on the other hand it is consistent with Gibson’s claim about the mediating influence of Australia’s egalitarian tradition.
– Under the guise of removing red tape and green tape, the Abbott government has undertaken the abolition or weakening of any agencies or advisory groups or information channels which could serve as independent sources of oversight of particular industries or issues. For example, the abolition of the Australian Preventative Health Agency which provide an independent check against the alcohol industry and junk food industry. Similarly the defunding of the CSIRO by $111.4 M is designed to weaken an organization whose functions include important independent research in the area of environmental impacts and climate change.
– A proposed move to ‘competitive federalism’ which include moves to try to wind back national environmental standards and institutions (as well as other nation-wide institutions that share the common wealth) in order to promote open-slather competition between the states in their quest for transnational capital investment.
In all of this, there are some glimmers of hope. So far, the Abbott government has been astoundingly incompetent in the implementation of its neoliberal agenda – although reliance on others’ incompetence is hardly a strategy of resistance. Also heartening is that the Labor party may be starting to rediscover some of the traditional Australian egalitarian values that have ‘muted’ neoliberalism in the past.
But it would be even better if Labor could undertake a more thorough-going distancing from the impoverished logic of neoliberal reason. Neoliberalism, in its hard core form, is merely one particular view – particularly extreme and rapacious – about the role of markets and more generally of economizing logic in contemporary societies. It is entirely possible to propose other ways of organizing markets and economic incentives without necessarily accepting the typical neoliberal vision for the social organization of life and subjectivity. We need a public policy framework which dispenses with neoliberalism’s exceptionally distorted take on human motivation, and replaces it with a more well-rounded perspective which has room for the operation of markets but only under suitable regulatory conditions which foster social justice and ecological balance.