For the last four decades, political discourse has been dominated by the ideas of neoliberalism. This ideology has been promoted by elites to direct public policy not only in the US, but worldwide. Neoliberalism offers a simple story of our times by which people can make sense of the world in which they find themselves. British journalist George Monbiot has pointed to the importance of such stories in his recent book Out of the Wreckage: A New Politics for an Age of Crisis. His aim is to construct a new story to mobilize people into political action and create social change. To make way for a new politics, he deconstructs the neoliberal story as well as its opposing predecessor, the social democratic story. Both follow the same narrative pattern.
Here is his summary of neoliberalism:
The neoliberal story explains that the world fell into disorder as a result of the collectivizing tendencies of the over-mighty state, exemplified by the monstrosities of Stalinism and Nazism, but evident in all attempts to engineer social outcomes. Collectivism crushes freedom, individualism and opportunity. Heroic entrepreneurs, mobilizing the redeeming power of the market, would fight this enforced conformity, freeing society from the enslavement of the state. Order would be restored in the form of free markets, delivering wealth and opportunity, guaranteeing a prosperous future for everyone. The ordinary people of the land, released by the heroes of the story (the freedom-seeking entrepreneurs) would triumph over those who has oppressed them.
While this story encapsulates the worldview implicit in much of our public discussion, he fails to explain why it has taken hold of the public mind. We need to understand where this neoliberal story came from and the material conditions that gave this story purchase on the public consciousness.
Why Did Neoliberalism Take Hold of the Public Mind?
The neoliberal story did not just drop out of the sky. Its ideas have a material base that makes them the currency of elite discourse and popular opinion. Once they become the common sense at a particular historical moment, they become a political force informing public policy. What are the conditions that made the neoliberal story resonate in the sensibilities of so many for several decades?
The answer is found in understanding that neoliberalism is the default logic of governance in a capitalist society in the absence of social movements pressing for support of the interests of the popular classes. Social democracy rested on the power of such social movements. On the other hand, neoliberal policies are the natural posture of capitalist states, i.e. states in capitalist economic systems where all are caught in what Cynthia Kaufman in Getting Past Capitalism: History, Vision, Hope calls "the economic dependency trap of capitalism." In unbridled capitalism, workers, consumers and citizens depend on the continued functioning of the capitalist economy for their livelihood. Capitalists are the ruling class because their interests rule over everyone else. They rule not just from positions of power within the state, but from their control of the commanding heights of the economy upon which we all depend.
Neoliberalism is the default logic of governance in a capitalist society in the absence of social movements pressing for support of the interests of the popular classes.
What is the daily experience of people living under such rule? It is the powerlessness of atomized individuals, or what Sartre called "seriality." The terms Monbiot deploys -- alienation, loneliness, anxiety, isolation -- describe the experience well. But this is not because people have bought into the neoliberal story. It is the human consequence of the structural dominance of capital. Workers' productive activities are under the control of corporate managers. Consumers are manipulated by those same corporations that create a demand for the products through their sales effort. And citizens are governed by a state in service to capital. Ordinary people can limit that powerlessness only when they band together and act in solidarity through unions, campaigns and social movements. It is such democratic collectivities that neoliberalism seeks to dissolve.
Neoliberalism aims to reduce all human relationships to market relations. As Monbiot writes, "Defined by the market, defined as a market, human society should be run in every respect as if it were a business, its social relations reimagined as commercial transactions, people redesignated as human capital." This market supremacy is often thought to mean that government has no role in the direction of society. In fact, the state is necessary to establish and enforce the rules by which markets operate, a key point made by Robert Reich in his book Saving Capitalism: For the Many, Not the Few. Capital needs state power for this purpose. What neoliberalism seeks to eliminate is democratically responsive state action that limits the operation of capital. The market is to be structured in the interest of capital, not people.
Rise and Fall of the Social Democratic Story
The social democratic story Monbiot formulates embodies an opposing worldview:
The social-democratic story explains that the world fell into disorder -- characterized by the Great Depression -- because of the self-seeking behavior of an unrestrained elite. The elite's capture of both the world's wealth and the political system resulted in the impoverishment and insecurity of working people. By uniting to defend their common interests, the world's people could throw down the power of this elite, strip it of its ill-gotten gains and pool the resulting wealth for the good of all. Order and security would be restored in the form of a protective, paternalistic state, investing in the public good, generating the wealth that would guarantee a prosperous future for everyone. The ordinary people of the land -- the heroes of the story -- would triumph over those who had oppressed them.
Where did the social democratic story come from? It also did not fall out of the sky. Nor was it created by thinkers, although there have been many writers who have advocated its ideas. But what gave this story popular currency was the struggle of people against the harsh conditions imposed on them by capital and finally the collapse of capitalism in the Great Depression. This was the historical conjuncture in which individual action could not bring relief. Only collective action could create what Erik Olin Wright, in his book Envisioning Real Utopias, called the "associational power" that could countervail the power of capital weakened by its crisis. Capitalism was no longer able to meet the needs of the people it had made dependent, and so people struggled against it in order to survive. It was in that struggle that they discovered their power to overcome alienation, loneliness, anxiety and isolation. In those struggles, they overcame their individualism, discovering themselves as a "we." In this, they discovered their social being.
Neoliberalism aims to reduce all human relationships to market relations.
The capitalist state responded to popular demands in order to save capitalism from itself. The New Deal programs, along with the military Keynesian policies necessitated by World War II, restored a capitalist economy upon which the dependency of the population could be maintained. It was thus that the social democratic story became common sense. The consciousness of a collective "we" that could overcome social problems and build a fairer society was articulated in 1944 by President Franklin Delano Roosevelt at war's end in his "Economic Bill of Rights" speech to the nation. This was the high water mark of social democracy based on the understanding that we are all connected as members of a society. This vision was able to hold on into the social activism of the 1960s and in the Great Society program of the Johnson administration.
However, the post-war Golden Age of capitalism that extended into the 1970s began to erode the sense of collective agency. The suburbanization of cities broke up residential communities. Federal support for higher education opened a pathway to upward mobility for individuals. A capital-labor accord gave security to unionized workers in the corporate world. The promotion of consumerism led to a hedonistic conception of the good life. All of this brought the "American Dream" within the grasp of an expanding "middle class."
But this dream was a highly individualistic vision. There was little in the experience of most people to sustain the sense of collective agency of social democracy. While its institutions continued to undergird the success many enjoyed, this came to be seen as an individual achievement. Many workers came to see bureaucratic unions as unnecessary. Government agencies came to be seen as alien, bureaucratic obstacles that were removed from the people. Although these institutions were the fruit of popular struggles, they were not democratically accountable. And so, they were not seen as ours. It would have taken a continuing direct participation in them to sustain the sense of ownership that would have been necessary to defend them in the face of the coming onslaught of neoliberalism.
Toward a New Politics
This Achilles heel of social democracy can be seen in Monbiot's telling of its story when he says it is the agency of "a protective, paternalistic state" that restores order and security. It is this vulnerability of social democracy that he is intent to avoid in the new story that he offers us in the "politics of belonging." At the center of this story is a revival of community life that invokes feelings of togetherness and belonging. It is through these that "we can rediscover the central facts of our humanity: our altruism and mutual aid." He sees these virtues as rooted in our evolutionary heritage as a species which has been eclipsed by neoliberalism. Their revival requires that "decision-making is returned to the smallest political units that can discharge it." It is this principle of subsidiarity that allows for the kind of participatory democracy and collective agency at the heart of an alternative story needed in progressive politics today. It is a compelling story.
But what is the material basis for it to take root in popular consciousness today? Is there a political and economic basis for it? I suspect a political basis for it is taking form in the resistance to President Trump. His agenda is to intensify the neoliberal dismantling of the remnants of social democracy. In the sabotage of federal agencies, the deregulation of the economy, the privatization of public goods and the enrichment of the already rich, Trump is teaching us the value of institutions we had taken for granted and even thought we didn't need any longer. He has unwittingly mobilized broad sectors of the population into resistance -- a political activism that promises to reawaken the sense of civic engagement that democracy requires. All of that is a preface to a new story.
While neoliberalism has tried to school us to selfish individualism, it has failed to do so, as is evident in the resistance to its unbridled offensive today. As philosopher Ron Aronson has argued, "young people are insisting on social solutions to social problems."
The individualism that neoliberalism promotes is being replaced by a new common sense based in a sense of we, with its understanding of our interdependence and collective agency. Today's struggles against privatization in defense of public goods is nurturing such a new common sense. In his new book, We: Reviving Social Hope, Aronson argues that social hope is born from collective action, a we, not just I. It is in a movement that "we become members of a larger entity, drawing power from it, having responsibility to it, and experiencing ourselves within it." Through collective action, "the formerly powerless can generate something new, social hope, by acting together." And this can change not only the world in which we live, we also change ourselves. Social hope comes from collective agency and the collective consciousness it gives birth to.
So here is my formulation of a new story for our times:
False prophets had proclaimed an era of individual freedom from social responsibilities and restraints. We will set you free they proclaimed -- free from community, from group associations (such as a union), from cultural traditions, from historical roots, from conventional morality, from social institutions. You will be free to make of yourself what you wish, owing nothing to others, proudly proclaiming, "I did it my way." But gradually, individuals began to realize that without social supports they were less free -- in fact, powerless in the face of large corporations. Those other fictitious persons called "corporations" enjoyed the same freedoms as us flesh-and-blood persons. Their great power enabled them to exploit the labor of free individuals under their command, defile nature and poison the environment, and manipulate consumer demand for whatever they produced -- all to realize profits. And as their wealth grew, so too did their power over real persons.
Many despaired and grew angry as they lost their dream. But some kept hope alive by banding together with each other to better provide for our common needs. In our collective action, we discovered a human connection that enriched our lives. By restoring our social bonds, we have transcended the loneliness of negative freedom and discovered the positive freedom of community.
Today, there are many who are building new institutions at the local level that represent alternatives to the dominant corporate capitalism -- institutions like worker self-managed cooperatives, public banking and expanded commons. Monbiot adds to the list time banking, local currencies, transition towns and more. Not only do these illustrate the awakening of civic engagement, they also offer an economic alternative to neoliberal capitalism. Neoliberalism is more than an ideology or a set of political policies. It is the logic of an unbridled capitalist economy. So, in building alternative institutions, communities are not only acting politically and writing a new story, they are building the economic foundation of what might be the next system to succeed capitalism.
Bibliography and suggestions for further reading:
David Harvey gives us an insightful account of the cultural sources that made neoliberalism a new common sense in A Brief History of Neoliberalism (Oxford University Press, 2005), esp. Chapter 1.
Cass Sunstein, The Second Bill of Rights: FDRs Unfinished Revolution -- And Why We Need it More than Ever (Basic Books, 2006).
Ron Aronson, We: Reviving Social Hope (University of Chicago Press, 2017).
Cliff DuRand, ed., Moving Beyond Capitalism (Routledge, 2016).