Is Neoliberalism a Useful Word?

In one of the many heated Facebook debates I have had with friends the major question arises whether it makes any sense to use the word “neoliberalism” to describe anything. It is naturally important to define in each case what we mean by neoliberalism and if it is clear in the mind of the readers and discussants what is meant by neoliberalism in each case, we can make an authoritative statement about whether we should use the terminology.

But first to directly answer the question: ‘yes’, for me personally, and ‘it depends’ for whether it is generally useful. The usefulness of the term neoliberalism depends entirely on the political perspective of the person. People, who hate neoliberalism, use the word all the time (just do a Google Scholar search and get 253,000 results), while people, who like neoliberalism, hate the word. Thus, we have an interesting distinction between the word, the meaning and political perspective.

A normal word has a close association to its meaning and ideology often plays no role. If I say ‘table’ and assuming your knowledge of the English language, you will likely think of an object made out of wood, plastic or metal with a flat surface and one or a few legs to hold it up. We can have a different viewpoint around how many legs an ideal table should have or what the best material is, but we would not politically contest the basic definition I have given here. But in neoliberalism there is a clear distinction between word, personal ideology and meaning. Liking the ideology reduces one’s liking for the term, while hating the ideology increases one’s liking for the term.

Is neoliberalism a scientific term? People with a more natural scientific inclination would frown and dispute that a term that is so laden with personal feelings and ideological background can have any usefulness in science. If the theory of relativity were not E=mc2, implying E=Energy, m=mass and c=speed of light in a vacuum, because we have different political ideologies, then we don’t have a useful concept. Observations in nature that follow a particular rule have to be summarized in a theory that makes sense to all individuals and by replication of experiments can be repeated precisely.

Clearly, another important scientific domain- where we need to have full agreement over the content regardless of political ideology- is climate change. Here it is superbly difficult given that there is an extreme political faction in the United States that denies the existence of climate change, claiming that there is a political ploy to reduce US competitiveness (see President Trump and the Republican Party). The lack of deference to climate scientists, who have devoted their careers to study these very questions, creates the dilemma that we are ineffectively doing things to tackle and counteract climate change.

But let me just make the statement here that neoliberalism can be used as a term in the social sciences regardless of the diversity in views on its usage. My argument here is that we are naturally not applying the standard of the hard sciences, which says that all people regardless of political ideology have to agree on its meaning. For neoliberalism to be made social scientifically useful, all we have to do is to find a definition in a given article that can describe social phenomena of interest and is clearly communicated to the reader. In the most ideal case, this means that at least among the neoliberalism-haters or anti-neoliberals, mostly on the political left, who are throwing around the term like we regularly gulp down water to quench our daily thirst, we all agree on what it means. This does not necessarily happen, so the only way how we can keep the term in our daily discourse without losing scientific credibility is if we rigorously define it in the context that we are using it.

So after beating around the bush, I have arrived at the hard question at the heart of the matter. What is neoliberalism? It may be described as

  • a political ideology (the glorification of markets, the individual, the private entrepreneur, the investor, the capitalist; the detestation of government regulation of business and the welfare state; the penetration of the market logic/ consumerism in all elements of life, such as family, religion and social relations) and
  • an economic practice (promotion of free trade, deregulation of firms and financial institutions, privatization of public goods, tax cuts for the affluent, the creation of winner-take-all markets, the growth of technological forces favoring the capitalists, the shift of risk from the society, government and firm to the individual, the weakening of social welfare services, the precarization and insecurity of employment relationships in the labor market, the growth of income and wealth inequality and the degradation of the natural environment, especially in the form of climate change).

Also see Harvey (2005); Saad Filho and Johnston (2005)Dumenil and Levy (2011)Centeno and Cohen (2012)

Naturally, neoliberalism-concept-supporters or neoliberals (who are neoliberalism-word-haters) will focus on the political ideology, which like the belief in any religion revolves around some desirable features that have to be taken on faith (i.e. ideology), while discussions on economic practice remain by nature fragmented. Surely, free trade and privatization sound good, but precarization of the workforce and concentrating wealth at the top are undesirable, so they either remain silent on it or claim that neoliberalism or obsession with ‘free’ markets favoring the capitalist class have nothing to do with these undesirable social developments. Or they might acknowledge these social developments but accept it as a cost of an “innovative” society.

Conversely, neoliberalism-concept-haters or anti-neoliberals (who are neoliberalism-word-supporters) will focus on the economic practice, especially where the evidence for socially nefarious consequences is the strongest. But even where the neoliberals think they have a strong hand, there is criticism from the anti-neoliberals, e.g. free trade is criticized as not as desirable as ‘fair’ trade, or privatization benefiting a few big owners is not as desirable as state or worker-owned enterprises. Politically moderate anti-neoliberals (e.g. of the Keynesian social-democratic variety) might be inclined to be silent on the political ideology element, and good examples here is the Third Way of the 1990s led by people like Blair, Jospin and Schroder. “We are not against the market, and we are for labor market activation and an inclusive economic policy” etc. Left-wingers will attack both economic practice and political ideology at the same time, as a more communitarian, solidaristic ideology is incompatible with the principles of neoliberalism.

We may conclude that the social sciences are deeply political and that our own personal viewpoints pierce through every element that we analyze. For those, who have been socialized in Marxist thinking, this is the nature of the game. Social science is the analysis of social phenomena at the same time as it is the advocacy of social change based on underlying moral-political desiderata. For those, who want to hold onto the Weberian ethics of value-free science, we are still salvaged by my definition rule, i.e. define the word neoliberalism in the context of the argument/ article in which it is used to give readers a clear idea of what it means. It is only for natural science standards, which wants to eradicate all ambiguity in meaning and political intention, that neoliberalism cannot hold up to strict scrutiny. Too bad.

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One Response to Is Neoliberalism a Useful Word?

  1. @pplswar says:

    Generally leftists use it as a term of abuse i.e. “neoliberal drone strikes” as opposed to… state-capitalist/welfare state drone strikes, I guess? 😀

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