Theorizing Neoliberalism

A new word1) entered the vocabulary of the left in November 1999 with the momentous protest against the World Trade Organisation in Seattle—”neoliberalism”.2)

Just as the movement that erupted at that protest defined itself as being against “globalisation” (or “corporate globalisation”), so it came to describe itself as “anti-neoliberal”. The far left took over this terminology, often describing economic policies it opposed as “neoliberal”.

By Chris Harman

But there was an ambiguity in the term “neoliberal”. Did it refer to a way of running the capitalist system that could be changed with a change in government policy, or did it refer to something intrinsic to the present phase of capitalism that only challenging the system as whole could overcome? And was this present phase really described by the right wing “libertarian” anti-statist ideology of the neoliberals or was it a much more complex system of attacks?

Many of the most influential thinkers in the post-Seattle movement accepted the first answer to both questions. Leaders of Attac in France said their organisation was not “anti-capitalist”, but merely wanted to stop short term financial flows disrupting national economies.3)

Bernard Cassen, founder of Attac, wanted a “protectionist” national economy organised along capitalist lines. Susan George would occasionally speak about capitalism, but could also write of “the harmful consequences of globalisation”, as if this were something separate from, and intrinsically worse than, capitalism.

When it came to explaining what had changed since the 1960s, the emphasis tended to be on the victory of one ideology over another, rather than changes in the inner functioning of the global economic system. This was put very clearly by the French sociologist Pierre Bourdieu. He argued, “The main issue is neoliberalism and the retreat of the state. In France neoliberal philosophy has become embedded in all the social practices and policies of the state”.4)

This was “the effect of a shared belief…which has created a climate favourable to the withdrawal of the state and so submission to the values of the economy”.5)

The logic of this position was that all that was needed to reverse the unpleasant policies pursued by capitalist governments and corporations was a shift in ideology or politics at the top of society. Pressing for this could involve alliances with particular capitalist groups. Susan George spelt this out in theory, writing that “sometimes the allies may even be…-transnationals” such as those in the insurance industry.6)

Bernard Cassen applied this in practice by giving electoral support to the former French defence minister Jean-Pierre Chevènement. Such approaches contrasted sharply with the analyses of those of us who saw the faults falling under the rubric “neoliberalism” as flowing from the logic of capitalism at a certain stage in its development. This did not prevent us joining with the wider movement in agitating against those faults. As I wrote at the time, “Hundreds of thousands, perhaps millions of people are beginning, for the first time, to challenge the global system. They come from a vast range of backgrounds and experiences, and bring with them the differing ideas that have developed there”.7)

The different approaches were, however, bound to work themselves out in practice at some point. I added, “The movement will not be able to develop beyond a certain point unless such arguments are resolved”.8)

Developments over the past two years show that the arguments are indeed becoming important in practice. Alex Callinicos and Chris Nineham have written about the debilitating divisions that emerged in the World Social Forum movement that arose out of Seattle,9)

While Daniel Bensaïd and Pierre Rousset have pointed out: The “pillars” of the alterglobalisation—the Brazilian Workers Party and Rifondazione Comunista—lead or actively participate in centre_left governments , implementing openly social liberal policies. This evolution in less than six years is full of consequences. The problem does not lie in the suddenness of the conversions… The lack of resistance that they have encountered within their own parties must focus attention both on the limits of the anti-neoliberal rhetoric and the profound resignation that it has partially masked.10)

For this reason it is necessary to take up once again the analysis of the relationship of neoliberalism to capitalism—and by implication, of anti_neoliberalism to anti-capitalism.11)

Marxist analyses of neoliberalism

A number of Marxist analyses have attempted to come to terms with neoliberalism, for instance Gerard Duménil and Dominique Lévy’s Capitalism Resurgent, François Chesnais’s La Mondialisation du Capital and, probably most influentially, David Harvey’s The New Imperialism and A Brief History of Neoliberalism.

These works contain a mass of useful information about the world today. But they are also marked by the same ambiguity over neoliberalism to be found in the non-Marxist writings within the movement. All make reference to the problems faced by capitalism in the 1970s that led to a new period of crises. But they suggest that it is not capitalism as such that is to blame; rather it is a particular regime of capitalism. So Duménil and Lévy say that the new period was heralded by a fall in the rate of profit from which the system has not yet fully recovered,12) but then go on to describe the advance of neoliberalism as a “coup” (no less) by “finance capital” in the late 1970s.13)

This coup supposedly overturned the “Keynesian” approach of industrial capital, which had been based on accumulation through a “compromise” with working class organisations on the terrain of the welfare state.14)

Chesnais’s tone is often similar. He also refers to a “coup d’etat” in the late 1970s. He writes that “industrial capital” has been forced to subordinate itself to “money capital”.15)

Chesnais is a revolutionary socialist, but the implication of his argument is that, if “industrial capital” still dominated “finance capital”, capitalism today would not be experiencing a “mediocre or poor dynamic of investment” or “the destruction of industrial employment…and strong pressures which weigh on those jobs which remain”.16)

Essentially the same arguments are to be found in David Harvey’s work. He presents a picture of capitalism in the US, Western Europe and Japan before the mid-1970s expanding on the basis of “a class compromise between capital and labour”. This meant an acceptance that: The state could focus on full employment, economic growth and the welfare of its citizens, and that state power should be freely deployed alongside of, or if necessary, intervening in or substituting for market processes to achieve these ends. Fiscal or monetary policies usually dubbed “Keynesian” were widely deployed to dampen business cycles and to ensure reasonably full employment.17)

He calls this “embedded liberalism” and argues that it “delivered high rates of economic growth in the advanced capitalist countries in the 1950s and 1960s” and that a “social and moral economy was fostered through the activities of an interventionist state”.18)

He recognises that this system broke down in the mid-1970s. This was, he argues, caused by “a crisis of over-accumulation”, which he sees as persisting into the present.19)

But he goes on to imply, again and again, that an alternative was possible within the existing system. Capitalists, he argues, adopted the neoliberal approach because their class power had been diluted under Keynesianism and was threatened in the mid-1970s. Their response was determined by their need for a “restoration of class power”20) — or even because “neoliberalism creates conditions for class formation”.21)

One particular expression of this reassertion of class power has been the domination of finance over industry: “There was undoubtedly a power shift away from production to the world of finance… In a conflict between Main Street and Wall Street, the latter was to be favoured.” Harvey continues, “One substantial core of rising class power under neoliberalism lies, therefore, with the CEOs, the key operators on corporate boards, and the leaders of the financial, legal and technical apparatuses that surround this inner sanctum of capitalist activity.” And while they rise in power, the unfortunate shareholders are among those who suffer: “The power of the actual owners of capital, the stockholders, has been somewhat diminished”.22)

Sumber: Abdul Hadi W.M.'s Note pada Facebook.