Neoliberalism


 * Definition **

According to Pierre Bourdieu, neoliberalism is a political project for the reconstruction of society in accord with the demands of an unstrained global capitalism (as cited in Fairclough, 2000, p.147). In David Harvey’s perspective, neoliberalism is in the first instance a theory of political economic practices that proposes that human well-being can best be advanced by liberating individual entrepreneurial freedoms and skills within an institutional framework characterized by strong private property rights, free markets, and free trade. The role of the state is to create and preserve an institutional framework appropriate to such practices (Harvey, 2005, p.2).

In Harvey’s definition, neoliberalism is not a rejuvenation of liberalism in general, but as a distinctive economic theory which lives independently of mainstream liberal value and policies (Thorsen & Lie, 2006, pp.11-12). On the other hand, Blomgren indicated that the internal diversity or neoliberal thought ranges widely on a line with one end completely laissez-fire and the other of “classical liberalism,” with greater willingness to let the state play a more active role. Under Blomgren’s view, scholars give different theoretical groundings to neoliberal evaluations and policies which make different types of neoliberalism. Friedman favored neoliberal policies such as deregulation and privatization. Her perspective is based on the conception of natural law. Since human beings are by nature social, their social nature dictates a certain way of organizing society which places a great emphasis on individuals being “free to choose.” Similarly, Hayek focused on the notion of “spontaneous order” of social life, which is better than any kind of artificially created order when it comes down to securing individual liberty and well-being. As for Nozick, his argument is grounded on the statement that a set of immutable natural rights have been conferred to all human beings, and these rights makes it difficult to see that the state could have any legitimate role to play at all (as cited in Thorsen & Lie, 2006, pp.12-14).


 * The Emergence of Neoliberalism **

Neoliberalism seems to be the dominant ideology shaping our world today, and we live in an age of neoliberalism (Saad-Filho & Johnston, 2005, p.1). But it’s hard to be defined in a purely theoretical way. Blomgren and Malnes indicated that it is an incomplete philosophy or ideology stressed on how the state and its external environment ought to be organized in terms of politics, economics, and individuals (as cited in Thorsen & Lie, 2006, p.15). Neoliberalism refers to liberalism for an intellectual lineage that connects with 19th century economic liberalism associated with Manchester system, which was predicted upon laissez-faire economics and closely related to free trade. Unlike liberalism, neoliberalism does not advocate abolition of government intervention, or the removal of all barriers like tariff in order to encourage free competition (Martinez & Garcia, 2000). But the concepts of free market and free trade are important in both liberalism and neoliberalism discourses.

The historical background for the emergence of neoliberalism may due to the international power relations and capitalist crisis after two world wars. In the middle 1970s, the Keynesianism which dominated the economic discourse since 1945 went into reverse, to be replaced by a revived neoliberalism. The neoliberal turn is resulted from intellectual division of Keynesianism and its failure to develop public understanding of the economy which could compete with the neoliberal rhetoric of “free markets.” (Palley, 2005, p.21) Indeed, neoliberalism is understood with many narratives: globalization, free trade, state bureaucracy, flexibility of labor, unaffordable welfare programmes, modernization…etc. These words penetrate the discourse sphere of economics, education, politics, and the representation of everyday life in advertising and popular culture (Fairclough, 2000, p.148).

**The Early Usage of the Term in the 20th Century**

The usage of the term stretches back to the very end of the 19th century, but the usage and the concept about Neoliberalism is inconsistent. In 1950, Jacques Cros’ doctoral thesis employed the term neoliberalism in its title, and the thesis is the first book-length work about neoliberalism. After Cros, there are forty years in which the concept of neoliberalism is used only infrequently, and mainly to describe the situation in Germany. German social theorist and Catholic theologian Edgar Nawroth adopted a highly conservative critique to West German neoliberalism and inaugurated a new tradition of using the term depreciatively. Cros and Nawroth’s concept was slowly and gradually exported to the rest of the world, the English-speaking countries. During the 90s the term gained the prevalence it now has (Thorsen & Lie, 2006, pp.9-11). However, according to David Harvey, the world has experienced an emphatic turn towards neoliberalism in political-economic practice and thinking since the 1970s (Harvey, 2005, p.2).


 * Critique of Neoliberalism Under Globalization Trend **

Although neoliberalism conveys an ideology and a propaganda of its own, it is fundamentally a new social order in which the power and income of the ruling class are re-established (Duménil & Lévy, 2005, p.9). If we examine neoliberalism in a transnational scope, the neoliberal globalism is not at all a model of “economic deregulation,” and it does not promote “individual initiative” in general. Some critical perspectives indicate that neoliberalism imposes a specific form of social and economic regulation of the poor in every country and universal compliance with US interests. The most basic feature of neoliberalism is the systematic use of state power to impose financial market imperatives, in a domestic process that is replicated internationally by globalization (Saad-Filho and Johnston, 2005, p.4). For many people, neoliberalism employs a passion for intervention in the name of nonintervention (Granthan & Miller, 2010, p.174).

Written by Wei-Fen Chen (July 2012).

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 * References **

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Chomsky, N. (1999). //Profit Over People-Neoliberalism and Global Order.// NY: Seven Stories Press.

Duménil, G., & Lévy, D. (2005). The Neoliberal (Counter-) Revolution. In Saad-Filho, A., & Johnston, D. (Eds.), //Neoliberalism-A Critical Reader,// 9-19. London: Pluto Press.

Fairclough, N. (2000). Language and Neo-liberalism. //Discourse and Society, 11//(2), 147-148.

Friedman, M. (1962). //Capitalism and freedom//. Chicago, IL: University of Chicago Press.

Grantham, B. & Miller, T. (2010). The End of Neoliberalism. //Popular Communication, 8//(3), 174-177.

Harvey, D. (2005). //A Brief History of Neoliberalism.// NY: Oxford University Press.

Martinez, E. & Garcia, A. (2000). What is Neo-Liberalism? //CorpWatch.// Retrieved from []

Munck, R. (2005). Neoliberalism and Politics, and the Politics of Neoliberalism. In Saad-Filho, A., & Johnston, D. (Eds.), //Neoliberalism-A Critical Reader,// 60-69. London: Pluto Press.

Nozick, R. (1974). //Anarchy, State and Utopic//. Oxford: Blackwell.

Saad-Filho, A., & Johnston, D. (2005). Introduction. In Saad-Filho, A., & Johnston, D. (Eds.), //Neoliberalism-A Critical Reader,// 1-6. London: Pluto Press.

Palley, T. (2005) From Keynesianism to Neoliberalism: Shifting Paradigms in Economics. In Saad-Filho, A., & Johnston, D. (Eds.), //Neoliberalism- A Critical Reader,// 20-29. London: Pluto Press.

Thorsen, D.E. & Lie, A. (2006) What is Neoliberalism? Oslo, University of Oslo, Department of Political Science, Manuscript.