Part II of III
The reason "neoliberalism" appears to defy easy comprehension and definition is that it refers to a necessarily interdisciplinary, colonizing process. It is not about the use of markets or competition to solve narrowly economic problems, but about extending them to address fundamental problems of modernity -- a sociological concept if ever there was one. For the same reasons, it remains endlessly evolving, pushing the boundaries of economic rationality into more and more new territories.
The central aspect of modernity neoliberal ideas and policies promise to resolve is value relativism. In this, "neoliberalism" shares some heritage with liberalism but the value relativism of the 20th century is a more radical, more existential problem than that early liberals of the 17th and 18th centuries confronted. It derives from the fact that modern individuals face a fundamental question of who to be, as foreseen by Nietzsche and dragged into the mainstream by 1960s cultural movements. In a sense, it is a problem of modernism as much as one of modernization. With its emphasis on entrepreneurship and competition, neoliberalism efficiently deals with this problem: you can be anyone you want, but (1) you will have to pay for it, and (2) you will be tested against competitors. These two things are guaranteed, by legislation if necessary.
The virtue of competition, from a neoliberal perspective, is not that it maximises welfare but its agnosticism about the right solution to institutional, cultural and political problems. Marketization of the health care/insurance may not make sense economically, but to elected and appointed office holders, it's politically sagacious and efficacious. It abates the burden of authority, decision-making and expertise that otherwise lies heavily on their shoulders, opening up managerial questions of what to do to a broader set of experts.
The central feature of modernity, from a neoliberal perspective (and Hayek’s
Road to Serfdom captures this as well as anything else) is that we cannot know in advance what will work, who to be, or what to invest in, yet we must choose. The state's role being to rearrange society in recognition of this fact, with competition and the provision of information as the main tools with which to do so.
This modernization-via-marketization is not difficult to point out across the public sector, and it's crept further into our culture and personal lives with the rise of social media, personal debt and self-tracking tools, each of which leads us to make more calculated, rational decisions in the present, with a view to future outcomes.
But here we sit faced with recriminations of neoliberalism, and there is an important outcome-oriented explanation: it's more ably dealt with sociological problems than with economic ones. This might sound surprising, given the apparent dominance of economics that it involves. Yet its capacity to generate or tap into social and political consensus -– especially from ~1990 to ~2008 – was actually quite remarkable, owing to its foundational relativism, which chimes with a socially liberal worldview. Today, we inhabit a post-1960s pathos, in which self-respect and individual taste are our defining ethical commitments made tangible via the exercise of economic choice. Where these commitments start to slip -– as when individuals fall into depression and inactivity -– policy-making and political rhetoric acts fervently to restore them, often via quite aggressive
tactics aimed at reinforcing the entrepreneurial self.
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