Several years on from the Great Recession, global order is being forcibly reshaped by peoples defiant of a status quo which has left them miserably frustrated and indignant. Policies promoted to bring change to the reckless world of finance have instead embedded economic hardship, and elites have chosen either to cultivate a culture which shamelessly links that hardship to dubious work ethic or to downplay glaring inequality altogether.
All the while, income disparities continue to widen in most nations. That trend has only accelerated since 2007 — especially in the U.S., where it appears the rich and powerful were actually able to take advantage of the recession. And with more persons today displaced than at any point in history, Europe and the U.S. are faced with a crisis just as much ethical as logistical, well agreed-upon to be their own — albeit indirect — creation. We are living a burlesque, watching situation after situation swell to exceptional proportions while our leaders insist that the blame lies in a perfect storm of chance, (minor) mistakes, and political and sociocultural friction, to be weathered with patience and a bit of calibration along the way.
So how is it that amid what should seem exaggerated circumstances, politicians and executives alike throughout the West still warn against any broad changes in policy or practice? In large part, many governments’ political and economic goals, (paradoxically) in contrast to public goals, have been largely successful in recent history. Their root motivations likely include winning greater partisan influence or maintaining office. Of course, most governments pursue those objectives not through attempts to best provide for the expressed or perceived needs of their peoples, or even to fulfill campaign promises. Simply put, states are inextricably tied to powerful, private interests.
Though taking various appearances, those interests in much of the world manifest themselves through corporations. Many companies, from government contractors to chief exporters, can leverage their weight in a nation’s economy or significance to a government itself for agreeable policy. Others offer party and campaign contributions, generally seen as an unwritten requirement to amass the fortunes necessary to compete for any formalized political power. And, not surprisingly, some extend jobs post-politics or for family and friends, meals and vacations, and other gifts and perks. Each form is prolific in modern politics, and all signal that the government, whether incidentally or intentionally, is acting to serve corporate interests. When government primarily prioritizes those corporate interests, it is practicing neoliberalism.
Most basically, neoliberalism proclaims the main role of the state to be maintaining and securing markets — groups of consumers — for businesses. A “healthy” market necessitates three main characteristics: general austerity, little regulation, and safety (at least to the extent that public fears only incentivize further purchases).
Austerity naturally correlates with a wide need for social services, a void to be filled by private companies who together dominate the health, education, real estate, and even criminal justice sectors. Quality is matched with prices designed to maximize profit—usually semi-independent or even manipulative of demand. And as an added bonus, the sizeable section of market risky and unprofitable for investors and inevitably not touched by businesses makes philanthropy all the more notably laudable.
Deregulation encourages short- and even mid-term economic growth and investment as markets are maneuvered, people, resources, and the environment left to the invisible hand of the market — reliant on the goodwill, where existent, of employers and producers — but, once more, profit maximized with minimal risk.
Peace and order act to ensure the continued operation of the production and consumption circle. This suitable climate is maintained not only by militaries and law enforcement, but by media — privatized and public — through levels of selective coverage (read: censorship), operating in exchange for favorable treatment.
The displays of neoliberalism are many, but one central in most every instance is free trade. The notion consists of loosening regulations and tariffs to facilitate international business. While the potential to share technology, bypass wasteful bureaucracy, and improve foreign relations entice many, free trade more often than not creates a one-sided takeover of a developing economy by another already highly developed. It empowers huge corporations to expand their markets overseas, easily outcompeting younger, evolving businesses. Like a leak, capital begins to flow out instead of circling within the developing economy, as well as draining employment from developed countries ironically fueling today’s wave of xenophobia.
That’s not to say free trade is inherently exploitative; if capital flowed back and forth throughout both developing and developed economies, it would be quite admirable. But as of 2016, multinational corporations — more accurately “transnational” or “stateless” corporations — use free trade opportunistically to expand their sales and leverage their newfound supremacy in developing economies to set degrading though profitable labor, environmental, and product quality standards. And through treaties such as NAFTA, TPP, and TTIP, governments wishing to challenge corporate infringements on their sovereignty are subject to arbitration through tribunals built by the corporations themselves. This system has already dealt major setbacks to environmental protections in Ecuador and even Canada.
Another ideological manifestation comes in the privatization of public services and assets. This move fundamentally links the distribution and quality of what would otherwise be equally accessible services and resources to the potential for profit from an individual, household, or community. Uniquely modern and biological necessities alike, such as electricity and water, are then treated as luxuries, not something to be provided and compensated for but bought and sold for profit as companies stretch resources to meet goals for investors and executives. This structure arguably leads to apathy, negligence, and disaster, most notably in the recent Flint, Michigan, water poisoning crisis under French giant Veolia.
Yet another neoliberal aspiration is the reduction of taxes on corporations and high-earners or at least the preservation of already those already low. Such tax cuts encourage the accumulation of wealth among small portions of populations, which signals the loss of not only economic but political power by general populations throughout the West. Even corporate tax cuts, which theoretically may increase the amount of capital “trickling down” to working classes, fail to encourage such an outcome. In the U.S. between 2005 and 2012, S&P 500 companies allocated on average 91% of their revenues to paying dividends or buying back stocks — both regularly related to executive earnings — while they had averaged nearly fifty-fifty (before the dawn of buybacks) in 1980 near the beginning of inequality hikes.
A final major policy component is military interventionism to protect and enable market interests. Take the U.S. as an exemplar. The country has made incredible sacrifices for decades to protect energy and to a lesser extent geopolitical interests in the Middle East. How can we conclude that? Terrorism has only developed into a concern after years in the region, and even today the merits of direct intervention with hard power are highly debatable. Latin America, Africa, and South and Central Asia provide examples aplenty throughout the past fifty years of widespread human rights abuses equally pressing — and that’s ignoring those we prefer to look past in our home countries. Unlike in other regions, the tendency to prop up brutal dictatorships in exchange for stability and compliance has continued into the present in the Middle East, where a U.S.-backed Mubarak violently suppresses opposition with billions in American aid and the authoritarian and highly subversive Gulf states are still main allies in the area.
Thus, what was it that pushed the U.S. not only to prioritize the Middle East as it has, but to invest so heavily in securing it? Consecutive administrations desired a constant degree of control over the resource hub so as to avoid market volatility. Engrained through historical competition with the former U.S.S.R. in the region, concern for markets constituted motivation enough for a series of interventions, each tending to be more rash than the last.
Over the past four decades, neoliberalism has become the artificial norm in our politics and wider societies. Lopsided and easily gamed concepts such as “personal responsibility” and meritocracy have permeated down to micro-level interactions. Policies such as free trade, privatization, low corporate taxes, weakened social welfare, and foreign interventionism now dominate much of our national and international agendas. While countries like the U.S. and U.K. use their size and ample resources (i.e. development aid) to pressure smaller economies into free trade agreements, intergovernmental institutions like the World Bank, International Monetary Fund, and Inter-American Development Bank corner developing countries with much-needed loans demanding privatization and deregulation. Nonconformists are ostracized as “radical” and “unrealistic” regardless of their ideas or intentions. Meanwhile neoliberals, suggesting “safer” though insignificant tweaks, claim to hold the key to progress in “compromise” — frequently a result well aligned with their rather pragmatic ideology.
However, discontent with the path of the past several decades has triggered what many political “insiders” see as chaos. Regardless of whether or not populists are serving their best interests, people around the world are purposefully resisting an unfair and unsustainable “establishment”. The constituents of the democratic world have already connected the dots that far. It is only a matter of time before we understand the ideology at the heart of our troubles, and throw ourselves behind movements which at the least better represent us, if not better serve us.
