I have just encountered the writings of Quinn Slobodian. He has an interesting take on the role of the State in Neoliberalism, and Austrian Economics. It is worth looking at, but I have not yet read his major book The Globalists. His arguments make it clearer that Neoliberals and Austrian Economists are not Libertarians, or anarchist at all, despite the support they receive from Libertarians. Neoliberals primarily want protection of markets, and market organisation, from States, but have no objection to States in principle, as long as those States defend markets and market power – especially against the people.
Protecting the market, wealth and property
Neoliberals attempt to “to insulate the markets against sovereign states, political change, and turbulent democratic demands for greater equality and social justice.” [1] For them, the State exists to protect capitalism, its extracted property and the world economy as it is, not to open the economy to ordinary people on equal terms. Neoliberalism was “less a doctrine of economics than a doctrine of ordering—of creating the institutions that provide for the reproduction of the totality [of the system].” [2]
The Fascist moment
Consequently, neoliberalism is a form of regulation rather than a form of anarchism. It probably developed as a preventative response to socialist movements, and the fact that their favoured fascism did not provide quite the defense of property that they had otherwise expected.
Mises argued that communists were murderous and the fascists reacted reluctantly in kind, but they, unlike the Russians would be unable to get rid of thousands of years of civilisation. Mises wrote in 1927 that:
Because of this difference, Fascism will never succeed as completely as Russian Bolshevism in freeing itself from the power of liberal ideas…. Fascism, in comparison with Bolshevism and Sovietism, [i]s at least the lesser evil.
Mises Liberalism, Online Library of Liberty: p: 49.
It cannot be denied that Fascism and similar movements aimed at the establishment of dictatorships are full of the best intentions and that their intervention has for the moment saved European civilization. The merit that Fascism has thereby won for itself will live on eternally in history. But though its policy has brought salvation for the moment, it is not of the kind which could promise continued success. Fascism was an emergency makeshift. To view it as something more would be a fatal error.
[3], & Mises Liberalism. Online Library of Liberty: p: 51. emphasis added.
This was not uncommon at the time. Slobodian remarks that Carl Schmitt “saw the need for what was effectively a fascist state as a way to prevent the rise of totalitarianism.” [4]
[I]n the late 1930s, Wilhelm Röpke, another leading neoliberal, would unabashedly declare that his desire for a strong state made him more “fascist” than many of his readers understood. We should not take this as a light-hearted quip.
[4]
In other words Fascism, and the autocratic State, was useful to maintain capitalism and its civilisation for a while. There seems little objection to the idea of an ‘intellectual’ fascist State as such, and of course, Mises could not understand where German fascism was to go. However, he fled the Nazis after the occupation of Austria.
Later on (1951) Neoliberals such as Mises and Hayek were to conflate Fascism and Nazism with socialism and Bolshevism, which ignores who sponsored them and why, and indicates a degree of hard and misleading binarism in their thinking. Socialist democracy in the UK and Australia between 1950 and the early seventies, and Scandinavian socialism is, according to them, the same as Nazism, Stalinist Communism and so on. If it is not the capitalism they support, it must be socialist, and must be evil. There is no ability to see degrees here, everything ‘bad’ is lumped together, as politically useful to support the idea that free markets lead to liberty, rather than to plutocracy and potential fascism.
We may also note the hostility of neoliberals to any effective idea of equality. Equality, in their view always demands an interventionist State, and therefore an authoritarian State of the wrong kind. Again the hard binarism is brought into play. They take a position we all know to be correct, namely that some people are more talented, dancers, musicians, painters, mathematicians, preachers, basketball players, swimmers etc, (and that some of these people work really hard to make themselves better), to say that one unlimited distinction in power and wealth between people based on the talents of business or inheritance is equally banal, harmless and even pleasurable.
Truly massive power and opportunity differences produced by the corporate market are to be defended at all costs, with the implication is that if you don’t succeed, you are inferior.
Neoliberals want to suppress the power of democratic peoples to challenge corporate capitalism and its wealth based power – and to prevent any kind of relative equality which might allow people to challenge corporate power. Hence the conflation of socialism, fascism and democracy, and the initial wary support of fascism which was common amongst the conservative and pro-capitalist Right at that time for similar reasons.
Containing protest through the State
The basic neoliberal position is that governments by attempting to control or interfere in the workings of the market generate inefficiency and autocracy – but it seems they refuse to consider the effect of corporations interfering in the working of the markets – or make it beneficial as with their denial of the market powers of private monopolies.
Therefore regulatory movements, and labour movements aiming at improvements for workers, or colonised people, must be crushed. Neoliberals had no objection to regulating protest against their favoured economic set up. Mises was, for example hostile to labour movements, and supported their suppression.
This led to some neoliberals supporting apartheid [3]. We are also left with Murray Rothbard’s lament against Martin Luther King:
mass invasion of private restaurants, or mass blocking of street entrances is, in the deepest sense, also violence. But, in the generally statist atmosphere of our age, violence against property is not considered “violence;” this label goes only to the more obvious violence against persons
Essentially, hurting property is as bad as harming people.
“Any lingering idea that neoliberals are anti-state will be dispelled because you can see that, in their own writings, the whole project of neoliberalism is about redesigning the state, especially in questions of law.” [4]
“Even a superficial reading of the primary texts of neoliberals makes this clear. Milton Friedman’s Economic Bill of Rights, James M. Buchanan’s fiscal constitutionalism, F. A. Hayek’s Constitution of Liberty, Gottfried Haberler’s proposals for GATT, Ernst-Joachim Mestmäcker on European competition law, William Landes and Richard Posner on intellectual property rights—the list goes on.” [5]
To some extent their way forward was through setting up international modes of regulation that were, explicitly non democratic, and not responsive to the people anywhere, such as the WTO.
This is not to say, that post the internationalist age, neoliberals are not comfortable with promoting nationalism and even tariffs if it helps support corporate power, or is seen as a tactic in compelling ‘free trade’. [7]
Unintended consequences (?) of neoliberalism
There is no “one-to-one transposition of blueprints from the pages of Hayek or Haberler or whomever to reality in some unmediated or direct way.” Ideas work through “uptake by domestic actors, who find certain of their own interests fulfilled by adopting neoliberal policies.” [4]
“The only reason why empire works is that it finds willing compradors and domestic elites who will do the work of empire for the metropole for the most part.” [4]
And this may have unintended effects (along with complexities of markets). For example:
Intellectual property rights become part of the WTO not because Friedman or Posner wanted them to be there, but because pharmaceutical companies, software companies, apparel companies, entertainment companies wanted them to be there and were very good at lobbying.
[4]
In other words, putting defense of the corporate market first, opens up further opportunities for important players to twist the market into favouring them, and diminishing the rights of ordinary people – in this case to use their own culture. In other cases we may note neoliberal attempt to defeat people’s right to drink non-poisoned water, and breath non-polluted air, and eat safe food.
Defending corporate liberty to pollute, set up monopolies, set up their own laws and police, or pay for politicians and political propaganda, may well set up the circumstances in which other people’s liberty is severely curtailed. Their liberty may not equal yours.
This loss of public liberty might count as an unintended consequence of neoliberal politics and theory intended to defend liberty but, then again, it might not.
Tags: neoliberalism, politics
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