I'd characterize soft neoliberalism a bit differently: "Let all markets rip, subject to controlling obvious externalities. Gain social democracy through progressive taxation and redistribution." The economics of this theory is fine on paper, except for the way that soft neolibs ignored antitrust. But it ran afoul of practical political economy. If enough people are sufficiently rich, they will have enough political power to avoid taxation, ignore externalities, and delegitimize redistribution.
To their credit, the soft neoliberals had decent social democratic ends. The problem: their means don't work.
Soft neoliberalism still has an excessive intellectual hold on our elites. It's still mostly what universities teach these days, AFAIK. We need less economics. More political economy, please.
Progressive parties shoukd take a page from the Trump populist playbook and throw out the parts of neoliberalism that don’t work for voters. Private equity is a curse on the economy. They undermine small and medium businesses and often push prices higher as they concentrate market share. Look at toll road pricing in Australia. Leaving the market to work out rents in any major city is sheer madness. Without the force of public investment there will be collusion to keep prices higher as they and handing investors excessive returns. The list of market failures for consumers is long. If ALP won’t do it some Katter / One Nation / Trumpets will convince voters the fault lies elsewhere
Because both parties rely on the wealthy and their corporations to fund their election campaigns. As a consequence, they need to continue funnelling public money to them so it can be laundered into political donations.
And this narrows the scope of the political debate down to only those measures that the donors and corporations allow. Seen most obviously in Australia in action on climate change. Only so much can be achieved because the fossil fuel funders have their limits when it impinges on their profits and ambitions.
A revealing footnote to the Getman election. From Bob Burton at Coalwire:
!The Free Democratic Party, which triggered the early election by withdrawing from a minority government with the SPD and Greens over climate policy, lost all 92 seats after failing to reach the five per cent threshold."
The FDP was the long-term home of German ordoliberalism, though its greatest exponent, Wolfgang Schäuble was CDU, and its demise is telling. The CDU under Merz is tempted by xenophobia, but shows signs of flexibility on the absurd constitutional debt brake.
I thought the comment from P Thompson was a catalyst for opening up the conversation even more.
Quiggin does well with potted histories with the added talent of complex numeracy.to back his propositions. Whay globalism could have been without coercion the inevitable induced slide to authoritarianism and erosion of context-related creative thinking.
Whereas classic liberalism could dismantle monopolies and abolish privileges confident that these were restricting progress and freedom, one of the more interesting aspects of neoliberalism is that it had to be enforced by the state and came with a plethora of regulatory bodies and laws (and a host of quiet reversals). Turns out that many state functions are the essential lubricant of the economic machine, without which it seizes.
"But until centre-left parties can escape the mental prison built by decades of soft neoliberalism, it is what we are likely to get."
That reminds me of the old quote: science progresses one grave at a time. Political parties are groupthink amplifiers. Change will happen when it forced upon them. That force will be votes. I vote for independents and minor parties because unless the major parties bleed many more votes than at present there is no motivation for them to change.
Perhaps this is controversial. I have long held the view that the Hawke government, while introducing some excellent reforms, also paved the way for the ALP to become enslaved to neoliberalism and gradually abandoning the working class. Please correct me if I am wrong about that.
What people forget is that the owners of capital are very happy to have public security forces to protect their gains. Police and military never seem to be struggling for increases in spending, the poor have to fight for themselves, the rich get to eat caviar away from the plebs knowing they are protected
Interesting timing. Last week Albanese announced the partial nationalisation of the South Australian steel industry. This weekend Dutton claimed the coalition will match Labor Medicare election boost.
It is stranging seeing erstwhile left parties became the parties of neoliberalism, but they are becoming aware they are the only ones flogging that dead horse with the exception of UK Labour. The US Dems don't count., they have always been neoliberals at heart, since the seventies party, long before Regan.
Very good overview John...but it's complicated, as you know....we're all bemused/appalled etc by the Trump 2.0 administration...and yet we're all watching with bated breath as to what happens in the Ukrain Crisis....then of course, there is the ongoing Israeli genocide of Palestinians in Gaza...and then, yet to come, is the looming adversity towards China....strap up for the roller-coaster ride
"In both the lagging east and the rust belts of the west, the AfD made particularly big strides among working-class voters – long seen as the Social Democrats’ key base. AfD support surged 17 points among workers to 38%, while the SPD haemorrhaged 14 points to land on just 12%."
It seems that the left wing strategy of telling white working class people that are are incorrigible racists has destroyed the Social Democrats in Germany just like it did in Sweden and elsewhere in Europe. The only Social Democrats who are doing OK are the ones who've moderated and become less shouty, such as the Danish SD.
The educated liberal elite must accept its share of the blame for pushing working class people in the direction of fascism.
Yes. I will write something about anti-immigrant politics and you can respond to it. Until then, please do not write about this topic, as I previously requested.
Worth noting that in Germany the 'working class' is only around 10 per cent of voters. As JQ has said alsewhere, the typical worker is now in an office, a school or in healthcare .
I notice that you did not refer to greed. This is the driving force of neoliberalism. It is based on individualism. I like the definition of capitalism as "The remarkable belief that the nastiest of men, for the nastiest of reasons, will somehow work to the benefit of us all". Unconstrained capitalism was undermined a little when labour became more valuable (due to pressure from workers and/or scarcity). That is when neoliberalism took over. In a democracy, we each get one vote in most realms, but in the economic sphere, the number of "votes" we each get depends on our wealth. A millionaire gets a million economic "votes" while a homeless person gets none. When has there ever been a truly free market where everyone is a price-taker, not a price-maker? My biggest gripe is that neoliberalism leads to excessive consumerism which leads to runaway climate change.
I didn't mean a literal bailout of institutions. I was referring to the expansionary policy that prevented a recession and created the belief that the Fed would always come to the rescue. This belief was described as the "Greenspan put"
I'd characterize soft neoliberalism a bit differently: "Let all markets rip, subject to controlling obvious externalities. Gain social democracy through progressive taxation and redistribution." The economics of this theory is fine on paper, except for the way that soft neolibs ignored antitrust. But it ran afoul of practical political economy. If enough people are sufficiently rich, they will have enough political power to avoid taxation, ignore externalities, and delegitimize redistribution.
To their credit, the soft neoliberals had decent social democratic ends. The problem: their means don't work.
Soft neoliberalism still has an excessive intellectual hold on our elites. It's still mostly what universities teach these days, AFAIK. We need less economics. More political economy, please.
Progressive parties shoukd take a page from the Trump populist playbook and throw out the parts of neoliberalism that don’t work for voters. Private equity is a curse on the economy. They undermine small and medium businesses and often push prices higher as they concentrate market share. Look at toll road pricing in Australia. Leaving the market to work out rents in any major city is sheer madness. Without the force of public investment there will be collusion to keep prices higher as they and handing investors excessive returns. The list of market failures for consumers is long. If ALP won’t do it some Katter / One Nation / Trumpets will convince voters the fault lies elsewhere
Because both parties rely on the wealthy and their corporations to fund their election campaigns. As a consequence, they need to continue funnelling public money to them so it can be laundered into political donations.
And this narrows the scope of the political debate down to only those measures that the donors and corporations allow. Seen most obviously in Australia in action on climate change. Only so much can be achieved because the fossil fuel funders have their limits when it impinges on their profits and ambitions.
It is not just climate change, but also the minimum wage, union power, media lying (i.e. Murdoch), disinformation, electoral donations to name a few.
A revealing footnote to the Getman election. From Bob Burton at Coalwire:
!The Free Democratic Party, which triggered the early election by withdrawing from a minority government with the SPD and Greens over climate policy, lost all 92 seats after failing to reach the five per cent threshold."
The FDP was the long-term home of German ordoliberalism, though its greatest exponent, Wolfgang Schäuble was CDU, and its demise is telling. The CDU under Merz is tempted by xenophobia, but shows signs of flexibility on the absurd constitutional debt brake.
The failure of both the FDP and BSW is the good news from the election. Hopefully both are gone for good, at least at the national levle.
I thought the comment from P Thompson was a catalyst for opening up the conversation even more.
Quiggin does well with potted histories with the added talent of complex numeracy.to back his propositions. Whay globalism could have been without coercion the inevitable induced slide to authoritarianism and erosion of context-related creative thinking.
Whereas classic liberalism could dismantle monopolies and abolish privileges confident that these were restricting progress and freedom, one of the more interesting aspects of neoliberalism is that it had to be enforced by the state and came with a plethora of regulatory bodies and laws (and a host of quiet reversals). Turns out that many state functions are the essential lubricant of the economic machine, without which it seizes.
"But until centre-left parties can escape the mental prison built by decades of soft neoliberalism, it is what we are likely to get."
That reminds me of the old quote: science progresses one grave at a time. Political parties are groupthink amplifiers. Change will happen when it forced upon them. That force will be votes. I vote for independents and minor parties because unless the major parties bleed many more votes than at present there is no motivation for them to change.
Perhaps this is controversial. I have long held the view that the Hawke government, while introducing some excellent reforms, also paved the way for the ALP to become enslaved to neoliberalism and gradually abandoning the working class. Please correct me if I am wrong about that.
What people forget is that the owners of capital are very happy to have public security forces to protect their gains. Police and military never seem to be struggling for increases in spending, the poor have to fight for themselves, the rich get to eat caviar away from the plebs knowing they are protected
Interesting timing. Last week Albanese announced the partial nationalisation of the South Australian steel industry. This weekend Dutton claimed the coalition will match Labor Medicare election boost.
It is stranging seeing erstwhile left parties became the parties of neoliberalism, but they are becoming aware they are the only ones flogging that dead horse with the exception of UK Labour. The US Dems don't count., they have always been neoliberals at heart, since the seventies party, long before Regan.
Very good overview John...but it's complicated, as you know....we're all bemused/appalled etc by the Trump 2.0 administration...and yet we're all watching with bated breath as to what happens in the Ukrain Crisis....then of course, there is the ongoing Israeli genocide of Palestinians in Gaza...and then, yet to come, is the looming adversity towards China....strap up for the roller-coaster ride
From the Guardian:
"In both the lagging east and the rust belts of the west, the AfD made particularly big strides among working-class voters – long seen as the Social Democrats’ key base. AfD support surged 17 points among workers to 38%, while the SPD haemorrhaged 14 points to land on just 12%."
It seems that the left wing strategy of telling white working class people that are are incorrigible racists has destroyed the Social Democrats in Germany just like it did in Sweden and elsewhere in Europe. The only Social Democrats who are doing OK are the ones who've moderated and become less shouty, such as the Danish SD.
The educated liberal elite must accept its share of the blame for pushing working class people in the direction of fascism.
Noah Smith had written an excellent article on why Democrats (and the centre-left elsewhere) should embrace Clintonesque neoliberalism and ditch progressive extremism. https://www.noahpinion.blog/p/how-the-democrats-can-fight-back
Yes. I will write something about anti-immigrant politics and you can respond to it. Until then, please do not write about this topic, as I previously requested.
Fair enough. I wasn't entirely clear on the meaning of your earlier comment.
Worth noting that in Germany the 'working class' is only around 10 per cent of voters. As JQ has said alsewhere, the typical worker is now in an office, a school or in healthcare .
I notice that you did not refer to greed. This is the driving force of neoliberalism. It is based on individualism. I like the definition of capitalism as "The remarkable belief that the nastiest of men, for the nastiest of reasons, will somehow work to the benefit of us all". Unconstrained capitalism was undermined a little when labour became more valuable (due to pressure from workers and/or scarcity). That is when neoliberalism took over. In a democracy, we each get one vote in most realms, but in the economic sphere, the number of "votes" we each get depends on our wealth. A millionaire gets a million economic "votes" while a homeless person gets none. When has there ever been a truly free market where everyone is a price-taker, not a price-maker? My biggest gripe is that neoliberalism leads to excessive consumerism which leads to runaway climate change.
There was no bail-out by the Fed after the bursting of the .com bubble
Carnage was confined to equities markets.
I didn't mean a literal bailout of institutions. I was referring to the expansionary policy that prevented a recession and created the belief that the Fed would always come to the rescue. This belief was described as the "Greenspan put"