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Is the term neoliberalism useful?

by Elizabeth Humphrys on September 29, 2016
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There is an emerging body of literature questioning the usefulness of the term ‘neoliberalism’. This work has highlighted the tendency for new analysis to simply add another yet more precise definition of neoliberalism in an effort — as Rajesh Venugopal says — ‘to refine, complicate and extend old concepts, or to proliferate new ones’. At the same time, authors have often found solace in emphasising neoliberalism’s hybridity and variegation, but this has not necessarily enhanced understandings of what we mean by the conception or process.

In a recent paper in Critical Sociology, titled ‘How Labour Made Neoliberalism’, Damien Cahill and I argue there might be another way to bring greater clarity to the term and the processes of neoliberalism it describes. In our article we argue there is a dominant narrative across most of the critical and Marxist literature analysing neoliberalism, used to explain the global origins of these political economic changes in the vanguard neoliberal period of the 1970s and 1980s. The vanguard period was characterised by the initial and most intense implementation of neoliberal policies, as national economies were pushed into a new macro-economic and social policy framework in response to the economic crisis that ended the long boom. The dominant narrative posits that neoliberalism’s birth was in the Chicago Boys’ laboratory in Pinochet’s Chile, an experiment subsequently replicated at the heart of the global economy through the New Right projects of Thatcher and Reagan. On this account, the project was shaped and encouraged by neoliberal think tanks and thought collectives, such as the Mont Pèlerin Society, and imposed coercively on organised labour in a conscious effort to tame its power.

The existence and persistence of this dominant narrative, which we argue does not accurately reflect how neoliberalism was constructed across various locations in the vanguard neoliberal period, presents difficulties in understanding neoliberalism in practice. The intellectual hegemony of this account has meant that the advance of neoliberalism in Australia, where a social democratic party and trade union movement were centrally involved in shaping macroeconomic policy in the period of neoliberal construction, is almost always passed over for failing to fit the accepted model—despite the advance of vanguard neoliberalism here in a similar time period. There are other locations that do not fit the model as well, including New Zealand, The Netherlands, Poland and France.

We argue that in comparing the dominant narrative and the locations that shaped it—primarily the US and UK—to alternate locations, we can reveal what aspects of this widespread neoliberal origin story are more central, and identify those which fade from view. In the article we use a case study of Australia during the years of the Hawke-Keating Government (1983-1996) to demonstrate the incapacity of the dominant narrative to explain neoliberalism’s advance in that location. We then assess how neoliberalism was constructed by the Australian Labor Party Government and the trade unions through the corporatist Prices and Incomes Accord. Controversially, we argue that the labour movement was not simply an object or victim of neoliberal change but an active constructor of it. We use our conclusions to then re-assess the roll out of neoliberalism in the so-called neoliberal heartlands of the US and UK, and argue that the agency of labour needs to be written into the neoliberal origin story in those locations and more broadly.

Our paper has been made available online before the print edition of the journal. The paper is also part of a special issue focusing on neoliberalism, the key themes of which will be the subject of a future PPE post.

Elizabeth Humphrys

Elizabeth is a Scholarly Teaching Fellow in Social & Political Sciences, within the Communications program, based in the Faculty of Arts and Social Sciences, at the University of Technology Sydney.

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