I've been reading the blog Stumbling and Mumbling this and last week. I think I visited it a long time ago but it might have gone over my head.
Chris Dillow:
"Is there a grand plan behind Tory economic policy? Simon asks:
Whatever other problems capitalists have, a militant working class is not one of them. In these conditions, austerity is hostile to capitalists’ interests, insofar as weaker aggregate demand depresses profits ...
Three other things also make me think this:
- Osborne has retreated significantly from the spending cuts he planned a year ago. This is not the action of a man with a plan on cutting the state to encourage capitalist growth.
- This government is not noticeably expanding the realm of markets and profit-making opportunities. Privatization of the NHS is slow. And whilst academisation will allow a few spivs to make money, I’m not sure it represents a significant expansion of the domain of capitalism.
- Many other Tory policies are hostile to the interests of many capitalists: the uncertainty created by the Brexit referendum; immigration controls and the National Living Wage.
The left has often in the past under-estimated its enemies. But I’m not sure this is the case now. Sometimes, there is no great conspiracy or brilliant strategy. Sometimes, a twat is just a twat."
Indeed, the twat is, has been, and will be just a twat. Nothing shows conservative economic illiteracy better than that their approach has hurt households and capital. The arguments for austerity, ungrounded as they were for the UK, should have been discredited by now. I think Osbourne's continuing backtracking with regards to cuts reflects some doubt about the efficacy of austerity at the top, but of course the spin on that has always been that the initial burst of austerity achieved key goals more efficiently than anticipated creating fiscal breathing room. To be honest, they probably actual believe that themselves.
There's probably some witty remark to be made about the effects of living in a spinning world. It would prompt consideration of whether a spun spinner can be unspun.
Getting away from individual actors, the first quote is worth reading in greater length:
Simon Wren Lewis:
"... None of this detracts from the basic point that Quiggin makes: the apparent drift from the political centre ground is a consequence, for both left and right, of the financial crisis. I would add that what today counts as the centre in economic terms, which is pretty neoliberal, is rather different from what was thought of as centre ground politics before the 1990s. Now some of those on the left would like to think that this collapse of the centre was an inevitable consequence of the financial crisis. I am less sure about that. On its own, that crisis might have shifted the centre on economic issues to be a bit less neoliberal, and that might have been that.
One interesting question for me is how much the current situation has been magnified by austerity. If a larger fiscal stimulus had been put in place in 2009, and we had not shifted to austerity in 2010, would the political fragmentation we are now seeing have still occurred? If the answer is no, to what extent was austerity an inevitable political consequence of the financial crisis, or did it owe much more to opportunism by neoliberals on the right, using popular concern about the deficit as a means by which to achieve a smaller state? Why did we have austerity in this recession and not in earlier recessions? I think these are questions a lot more people on the right as well as the left should be asking."
(To clarify, earlier in his post Wren-Lewis defines neoliberalism broadly, on a one dimensional scale with it and statism on opposite ends, so, unless I misunderstand, neoliberalism as he uses it there includes the American right.)
I think there was opportunism on the right and that it's easier to see in American politics. The US, even more so than the UK, never needed to be concerned about its debt after the financial crises. Looking at their policy proposals Republicans themselves were clearly never concerned. However, they used easy to display, and more importantly easy to misrepresent, data about the ballooning federal deficit and debt level during the recession to play for major cutbacks to welfare programs and for a general shrinking of the state. Dillow is right to say that Osbourne failed to help the rich, but I think he genuinely thought the British state was too big and needed to be shrunk, a belief that seems impossible to hold without a neoliberal ideology.
But, what exactly is neoliberal ideology? It is not just the opposite of statism. Back to Chris Dillow:
"... Most leftists, I reckon, would describe all the following as distinctively neoliberal policies: the smashing of trades unions; privatization; state subsidies and bail-outs of banks; crony capitalism and corporate welfare (what George calls “business takes the profits, the state keeps the risk”; the introduction of managerialism and academization into universities and schools; and the harsh policing of the unemployed.
What do they have in common? It’s certainly not free market ideology. Instead, it’s that all these policies enrich the already rich. Attacks on unions raise profit margins and bosses’ pay. Privatization expands the number of activities in which profits can be made; managerialism and academization enrich spivs and gobshites; and benefit sanctions help ensure that bosses get a steady supply of cheap labour if only by creating a culture of fear. Ben’s claim that neoliberalism is happy with a big state fits this pattern; big government spending helps to mitigate cyclical risk ..."
This definition does fit on a one dimensional scale, but it's a marxist scale, and is different from the scale Wren-Lewis uses. An important point emerges: there is disagreement on whether neoliberalism supports a big state. A big state can counter cyclicality and generally work to the rich's advantage, but to some degree this contradicts other tenets of the ideology and implicitly supports the notion that state intervention can be effective in, say, alleviating poverty. So I agree with Wren-Lewis that theoretically neoliberalism has tended to oppose a big state, but one only needs to look at the G.W. Bush administration to recognize that neoliberals have often overseen an expansion of the state.
I also think the distinction Wren-Lewis points out, that neoliberals only opposed stimulus in the most recent recession, is interesting. I don't claim to understand why that was, but I think it's worth thinking about the need for neoliberals, many elements of their policy agenda having been enacted and accepted, to look for new ways, perhaps misguided like Osbournomics, to seize the day. Moreover, austerity meshes better with the anti-statist elements of neoliberal ideology than stimulus does, and one can recognize the political benefits of this greater ideological coherence without denying that neoliberalism is front for helping the rich. In some way, there is a trade off between helping the rich by increasing demand and helping them by supporting an incoherent ideology that emerged to help, and continues, mostly, to function for, the rich.
The definitional disagreement also reflects a split within neoliberalism. If we take a broad view of neoliberalism, then we can view the current American archconservative ideological project, and this ideology is a project, as falling within it. John Quiggin points the definitions of neoliberalism in popular use, a point from which to look at how archconservatism relates:
"... Neoliberalism is mostly used to mean one thing in the US (former liberals who have embraced some version of Third Way politics, most notably Bill Clinton) and something related, but different, everywhere else (market liberals dedicated to dismantling the social democratic welfare state, most notably Margaret Thatcher)..."
These different uses are a lens through which to see shifts in American politics. Obama and the Democratic party are in many ways neoliberal in the American sense, but they don't represent the most neoliberal side of American politics: establishment Republicans. Establishment Republicans, who are ready to support immigration and, obviously, support the rich, fit Dillow's marxist definition of neoliberalism perfectly. While modern conservatives, establishment and extreme, portray themselves as market liberals trying to dismantle a welfare state that serves the 'other'. They are in the tradition of European neoliberals and perhaps better fit Wren-Lewis' definition. I think the differences between President G. W. Bush and conservative Republican candidates last fall illustrate how the Republican party mainstream has moved from Dillow's Marxist angle to Wren-Lewis's broader anti-statist view. Archconservatism took certain views promulgated by neoliberalism and focused efforts on building a coherent ideology around them, even if some of the bases for the ideology were the incoherent parts of neoliberalism. Ideological fervor combined with ideological incoherence to create today's Republican party and the extreme views it contains.
In that ideological incoherence can help facilitate shifts, and make an ideology appealing to groups that should be opposed (like old/poor white people and rich white people), it isn't necessary a problem, at least in the short run. If ideology is used by a group to argue for policies that are in fact good for that group, then there has been success. Problems can arises when an ideology gains momentum and becomes a motivation in its own right. For the Conservatives, belief in an ideology at an critical juncture that allowed for opportunism created Osbournomics and its failures. For the American right, ideological 'crazy debt' has created an uncontrollable and oppositional base.
I might be thinking too hard about all this though. Continuing the Dillow post above:
"... All this makes me suspect that those leftists who try to intellectualize neoliberalism and who talk of a “neoliberal project” are giving it too much credit - sometimes verging dangerously towards conspiracy theories. Maybe there’s less here than meets the eye. Perhaps neoliberalism is simply what we get when the boss class exercises power over the state."
Now, I don't think I've been talking about a neoliberal project, and I agree that at its core and in its origins, neoliberalism is a front for the interests of the rich. However, Dillow fails to account for how ideologies, even if rooted in serving capital, can become political motivations beyond that. In an extreme case, ideological tenets of neoliberalism gained momentum of their own and become the core of archconservatism. In a subtler case, something made Osbourne think austerity was a good idea.
Chris Dillow:
"Is there a grand plan behind Tory economic policy? Simon asks:
To what extent was austerity an inevitable political consequence of the financial crisis, or did it owe much more to opportunism by neoliberals on the right, using popular concern about the deficit as a means by which to achieve a smaller state?Michael Burke thinks the answer’s clear:
A central tenet [of Osbornomics] is that the private sector is the key to prosperity and that therefore everything possible should be done to promote and encourage it. The state should shrink in order to release the inherent dynamism of the private sector.I’m not so sure. I suspect Michael is giving Osborne too much credit ...
Whatever other problems capitalists have, a militant working class is not one of them. In these conditions, austerity is hostile to capitalists’ interests, insofar as weaker aggregate demand depresses profits ...
Three other things also make me think this:
- Osborne has retreated significantly from the spending cuts he planned a year ago. This is not the action of a man with a plan on cutting the state to encourage capitalist growth.
- This government is not noticeably expanding the realm of markets and profit-making opportunities. Privatization of the NHS is slow. And whilst academisation will allow a few spivs to make money, I’m not sure it represents a significant expansion of the domain of capitalism.
- Many other Tory policies are hostile to the interests of many capitalists: the uncertainty created by the Brexit referendum; immigration controls and the National Living Wage.
The left has often in the past under-estimated its enemies. But I’m not sure this is the case now. Sometimes, there is no great conspiracy or brilliant strategy. Sometimes, a twat is just a twat."
Indeed, the twat is, has been, and will be just a twat. Nothing shows conservative economic illiteracy better than that their approach has hurt households and capital. The arguments for austerity, ungrounded as they were for the UK, should have been discredited by now. I think Osbourne's continuing backtracking with regards to cuts reflects some doubt about the efficacy of austerity at the top, but of course the spin on that has always been that the initial burst of austerity achieved key goals more efficiently than anticipated creating fiscal breathing room. To be honest, they probably actual believe that themselves.
There's probably some witty remark to be made about the effects of living in a spinning world. It would prompt consideration of whether a spun spinner can be unspun.
Getting away from individual actors, the first quote is worth reading in greater length:
Simon Wren Lewis:
"... None of this detracts from the basic point that Quiggin makes: the apparent drift from the political centre ground is a consequence, for both left and right, of the financial crisis. I would add that what today counts as the centre in economic terms, which is pretty neoliberal, is rather different from what was thought of as centre ground politics before the 1990s. Now some of those on the left would like to think that this collapse of the centre was an inevitable consequence of the financial crisis. I am less sure about that. On its own, that crisis might have shifted the centre on economic issues to be a bit less neoliberal, and that might have been that.
One interesting question for me is how much the current situation has been magnified by austerity. If a larger fiscal stimulus had been put in place in 2009, and we had not shifted to austerity in 2010, would the political fragmentation we are now seeing have still occurred? If the answer is no, to what extent was austerity an inevitable political consequence of the financial crisis, or did it owe much more to opportunism by neoliberals on the right, using popular concern about the deficit as a means by which to achieve a smaller state? Why did we have austerity in this recession and not in earlier recessions? I think these are questions a lot more people on the right as well as the left should be asking."
(To clarify, earlier in his post Wren-Lewis defines neoliberalism broadly, on a one dimensional scale with it and statism on opposite ends, so, unless I misunderstand, neoliberalism as he uses it there includes the American right.)
I think there was opportunism on the right and that it's easier to see in American politics. The US, even more so than the UK, never needed to be concerned about its debt after the financial crises. Looking at their policy proposals Republicans themselves were clearly never concerned. However, they used easy to display, and more importantly easy to misrepresent, data about the ballooning federal deficit and debt level during the recession to play for major cutbacks to welfare programs and for a general shrinking of the state. Dillow is right to say that Osbourne failed to help the rich, but I think he genuinely thought the British state was too big and needed to be shrunk, a belief that seems impossible to hold without a neoliberal ideology.
But, what exactly is neoliberal ideology? It is not just the opposite of statism. Back to Chris Dillow:
"... Most leftists, I reckon, would describe all the following as distinctively neoliberal policies: the smashing of trades unions; privatization; state subsidies and bail-outs of banks; crony capitalism and corporate welfare (what George calls “business takes the profits, the state keeps the risk”; the introduction of managerialism and academization into universities and schools; and the harsh policing of the unemployed.
What do they have in common? It’s certainly not free market ideology. Instead, it’s that all these policies enrich the already rich. Attacks on unions raise profit margins and bosses’ pay. Privatization expands the number of activities in which profits can be made; managerialism and academization enrich spivs and gobshites; and benefit sanctions help ensure that bosses get a steady supply of cheap labour if only by creating a culture of fear. Ben’s claim that neoliberalism is happy with a big state fits this pattern; big government spending helps to mitigate cyclical risk ..."
This definition does fit on a one dimensional scale, but it's a marxist scale, and is different from the scale Wren-Lewis uses. An important point emerges: there is disagreement on whether neoliberalism supports a big state. A big state can counter cyclicality and generally work to the rich's advantage, but to some degree this contradicts other tenets of the ideology and implicitly supports the notion that state intervention can be effective in, say, alleviating poverty. So I agree with Wren-Lewis that theoretically neoliberalism has tended to oppose a big state, but one only needs to look at the G.W. Bush administration to recognize that neoliberals have often overseen an expansion of the state.
I also think the distinction Wren-Lewis points out, that neoliberals only opposed stimulus in the most recent recession, is interesting. I don't claim to understand why that was, but I think it's worth thinking about the need for neoliberals, many elements of their policy agenda having been enacted and accepted, to look for new ways, perhaps misguided like Osbournomics, to seize the day. Moreover, austerity meshes better with the anti-statist elements of neoliberal ideology than stimulus does, and one can recognize the political benefits of this greater ideological coherence without denying that neoliberalism is front for helping the rich. In some way, there is a trade off between helping the rich by increasing demand and helping them by supporting an incoherent ideology that emerged to help, and continues, mostly, to function for, the rich.
The definitional disagreement also reflects a split within neoliberalism. If we take a broad view of neoliberalism, then we can view the current American archconservative ideological project, and this ideology is a project, as falling within it. John Quiggin points the definitions of neoliberalism in popular use, a point from which to look at how archconservatism relates:
"... Neoliberalism is mostly used to mean one thing in the US (former liberals who have embraced some version of Third Way politics, most notably Bill Clinton) and something related, but different, everywhere else (market liberals dedicated to dismantling the social democratic welfare state, most notably Margaret Thatcher)..."
These different uses are a lens through which to see shifts in American politics. Obama and the Democratic party are in many ways neoliberal in the American sense, but they don't represent the most neoliberal side of American politics: establishment Republicans. Establishment Republicans, who are ready to support immigration and, obviously, support the rich, fit Dillow's marxist definition of neoliberalism perfectly. While modern conservatives, establishment and extreme, portray themselves as market liberals trying to dismantle a welfare state that serves the 'other'. They are in the tradition of European neoliberals and perhaps better fit Wren-Lewis' definition. I think the differences between President G. W. Bush and conservative Republican candidates last fall illustrate how the Republican party mainstream has moved from Dillow's Marxist angle to Wren-Lewis's broader anti-statist view. Archconservatism took certain views promulgated by neoliberalism and focused efforts on building a coherent ideology around them, even if some of the bases for the ideology were the incoherent parts of neoliberalism. Ideological fervor combined with ideological incoherence to create today's Republican party and the extreme views it contains.
In that ideological incoherence can help facilitate shifts, and make an ideology appealing to groups that should be opposed (like old/poor white people and rich white people), it isn't necessary a problem, at least in the short run. If ideology is used by a group to argue for policies that are in fact good for that group, then there has been success. Problems can arises when an ideology gains momentum and becomes a motivation in its own right. For the Conservatives, belief in an ideology at an critical juncture that allowed for opportunism created Osbournomics and its failures. For the American right, ideological 'crazy debt' has created an uncontrollable and oppositional base.
I might be thinking too hard about all this though. Continuing the Dillow post above:
"... All this makes me suspect that those leftists who try to intellectualize neoliberalism and who talk of a “neoliberal project” are giving it too much credit - sometimes verging dangerously towards conspiracy theories. Maybe there’s less here than meets the eye. Perhaps neoliberalism is simply what we get when the boss class exercises power over the state."
Now, I don't think I've been talking about a neoliberal project, and I agree that at its core and in its origins, neoliberalism is a front for the interests of the rich. However, Dillow fails to account for how ideologies, even if rooted in serving capital, can become political motivations beyond that. In an extreme case, ideological tenets of neoliberalism gained momentum of their own and become the core of archconservatism. In a subtler case, something made Osbourne think austerity was a good idea.
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