Yes, Indeed, Neoliberalism Is A Real Problem

By Graham Peterson

Where did we get neoliberalism from though?  Some say it is the pernicious creep of a hegemony of market based thought — thought which recommends reducing the scope of the state, privatizing resources, and letting reckless markets and competitive impulses invade communities and families.  Something like that, at least.

What’s paradoxical about this story, is that the expansion of markets has been allowed only insofar as it can be justified on the grounds that markets enter into the social production function — a production function which the state is still ultimately responsible for managing.  The fall of communism signaled to the world that capitalism was at least more materially productive than state managed collectives, and that it was certainly more amenable to something that looked less like bloody political oppression than states always do.

But the idea seems to remain that markets are merely a means to an end.  Many economists, libertarians, and so forth seem to believe that material events have vindicated the logic of distributed and local knowledge, free entry and exit, the sovereignty and intelligence of individuals, and so forth.  But I think that is incorrect.

I think people are much more likely to intuit, still, that society is a giant factory, or more probably a giant household, in which we want mom and dad to choose the organization of chores that gets everybody the most PlayStations (markets), but still lets the kids crash on the couch if they can’t find a job right out of college (the large welfare state).

If we view markets as a means to an end in a social production function that someone other than ourselves and our neighbors are responsible for managing — which is precisely how the pro-business lobby and neoconservatives have put it — and if the left has been forced by material events to begrudgingly adopt that view despite its suspicious ethical foundation, we have accomplished almost nothing in an empirical or philosophical demonstration of market logic.

And in this neoliberal environment, classical liberals, economists, and the political left alike, ought to continue to expect the expansion of government on precisely the margins we do not want (the mass incarceration of blacks, say, or the subsidization of high finance).  Neoliberalism is a gross error.  And I must apologize to my friends on the left for the mistakes of market boosters before me who have promoted this idea.

Distributing political and social freedoms widely in order to encourage voluntary association and peaceful deals among people is not a means to an end — it is an ethical and material end in itself.

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