jhp5453788dd8ad8Book review by Katherine Trebeck

‘We have never been neoliberal – a manifesto for a doomed youth’ by Kean Birch, Zero Books 2015

‘Down with neoliberalism’ seems to be an almost ubiquitous cry from activists who position themselves on the ‘left’ (the diminishing merit of using a left-right spectrum is for another time). Decrying neoliberalism seems to nicely encapsulate people’s unease and anger with the inequality, precarity, privatisation, and consumerism spawned by Anglo-Saxon varieties of capitalism.

Slogans have their place, but what if this particular one is founded on a theory not borne out by reality?

In his new book, geographer Kean Birch – someone more than sympathetic to those seeking to transform capitialism from its extractive mode – points to a raft of evidence showing that not only does the mode of capitalism we’re now seeing pre-date the intellectual ascendancy of neoliberalism, it also does not conform to the theoretical axioms text books would lead us to expect.

Birch gently takes the reader through various schools of thought about the rise and influence of neoliberalism – and this alone represents an important contribution of the book. He outlines key tenets of neoliberalism (despite the lack of scholars self-identifying as neoliberals) – monetarism, an emphasis on price stability (as opposed to full employment), privatisation, a critique of the ability of government to effectively intervene etc.

But, here’s the kicker, things didn’t really pan out the way neoliberal theory would predict. Or even recommend.
Instead of free markets, Birch explains, we’ve seen freedom for monopolies (in a way that has elevated individual and personal responsibility at the expense of collective action: home ownership becomes better ‘insurance’ than state provided welfare, for example).
Instead of smaller government, we’ve seen huge government action and expenditure to protect, even subsidise, asset owners.
Instead of market stability, we’ve seen fluctuation and speculation.

He cites Barry C Lynn’s description of modern monopolies in which competition has shifted from the horizontal (namely between competing firms) to a vertical plane in which corporate monopolies compete with everyone below them – from workers to suppliers. And importantly, Birch highlights that the rise of these corporate monopolies predates the rise of neoliberal influence on policy making – perhaps even driving the transformation of neoliberal ideas in the 1950s, 1960s and 1970s, as opposed to the other way around.
Of course some reality mirrored theory – the massive sell-off of government assets, moves to reduce the power of unions, reductions in taxes on the wealthy, restoration of class power, and cuts in (some elements of) public spending.

Instead Birch offers a new term that more accurately reflects the transformation of our economies – assetisation:

’our societies have turned into asset-based economies…[there has been] a rise of asset ownership in the form of debt, securities, housing etc – such asset ownership has even taken on the moral overtones of individual responsibility, thriftiness, hard-work, and so on…What resulted was the tying of ourselves to a massive Ponzi-scheme in which we became dependent on ever rising asset prices’.

Once this notion is in your mind, you see the proof of Birch’s thesis all around.

If there is one quibble I have with his well-written and accessible book, it is that Birch is too flippant in his use of the term ‘we’. He, justifiably, explains how it is not just the 1% who are culpable in the current configuration of markets and political orthodoxy, and claims that via our pension funds, the pursuit of appreciation on the value of our houses and so on, ‘we’ are all complicit in the assetisation and financialisation of our economy, at the expense of greater wage share. He explains that ‘institutional investors represent the money of ‘Joe and Jane Public’ invested in their pensions, their saving accounts, insurance funds and so on’.

But while this might be a fair cop for the majority of US, Canadian and British citizens, it certainly does not apply to everyone. The poorest in our societies can only dream of pensions beyond that provided by the state. The deep inequalities of life expectancy that closely follow a socio-economic gradient mean that many will not even live to pensionable age. And as for owning a house, well, that has long been but a dream for many in our poorest communities, but this socio-economic cleavage is being augmented by a generational one as ‘generation rent’ see home-ownership as something only their friends fortunate enough to inherit will experience.

Birch finishes his book with a ‘Manifesto for a Doomed Youth’. He seeks to identify more appropriate targets for activism and protest than those which following a neoliberal track might suggest. Birch suggests doing everything possible to avoid student debt and the indenture it brings; he celebrates people making their own meaningful work using intellectual assets (though he’ll kill me for using the term ‘assets’ in this sense!); and he implores us to explore alternative models of housing (such as cooperatives).

Birch’s book reminds us to not only look beyond the slogans, but to look at our own lives and the configuration of our own financial affairs as a source of action. It is fun to read – combining (an unwarranted!) self-deprecation with enough empirical evidence to give the reader ample proof of his arguments. As political leaders in the ‘Atlantic Heartlands’ celebrate supposed economic recovery (essentially an even more extreme form of Business As Usual), Birch’s ‘We Have Never Been Neoliberal’ is a timely warning of political deference to wealth and of how consistently the state has acted in the interests of asset owners, rather than the interests of the public in a larger, more collective sense.