Jason Hickel on Neoliberalism

“Some people have the tendency to think of neoliberalism as a mistake – an overtly-extreme version of capitalism that we should reject in favor of returning to the somewhat more humane version that prevailed in prior decades. But the shift to neoliberalism was not a mistake; it was driven by the growth imperative. In order to restore the rate of profit and keep capitalism afloat, governments had to shift away from social objectives (use-values) to focus instead on improving the conditions for capital accumulation (exchange-value). The interests of capital came to be internalized by the state, to the point where today the distinction between growth and capital accumulation has almost completely collapsed. Now the goal is to tear down barriers to profit – to make humans and nature cheaper – for the sake of growth.”

“People commonly think of neoliberalism as an ideology that promotes totally free markets, where the state retreats from the scene and abandons all interventionist policies. But if we step back a bit, it becomes clear that the extention of neoliberalism has entailed powerful new forms of state intervention. The creation of a global 'free market' required not only violent coups and dictatorships backed by Western governments, but also the invention of a totalizing global bureaucracy – the World Bank, the IMF, the WTO and bilateral free-trade agreements – with reams of new laws, backed up by the military power of the United States. In other words, an unprecedented expansion of state power was necessary to force countries around the world to liberalize their markets against their will. As the global south has known ever since the Opium Wars in 1842, when British gunboats invaded China in order to knock down China's trade barriers, free trade has never actually been about freedom. On the contrary, as we have seen, free trade has a tendency to gradually undermine national sovereignty and electoral democracy.”

“A contradiction lies at the very centre of the neoliberal project. On a theoretical level, neoliberalism promises to bring about a purer form of democracy, unsullied by the tyranny of the state. Indeed, this claim serves as the model lodestar for neoliberal ideology - a banner under which it justifies radical market deregulation. But, in practice, it becomes clear that the opposite is true: that neoliberalism tends to undermine democracy and political freedom. More than 40 years of experimentation with neoliberalism shows that it erodes the power of voters to decide the rules that govern the economic systems they inhabit. It allows for the colonization of political forums by elite interests - a process known as political capture - and sets up new political forums, such as the World Bank, the IMF, and the WTO, that preclude democratic representation from the outset. Neoliberalism also tends to undermine national sovereignty, to the point where parliaments of putatively independent nations no longer have power over their own policy decisions, but are governed instead by foreign banks, the US Treasury, trade agreements, and undemocratic international institutions, all of which exercise a kind of invisible, remote-control power.”