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We Have Never Been Neoliberal A Manifesto for a Doomed Youth

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.

Comments (4)

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  1. Grouse Beater says:

    England – Pure and Simple: http://wp.me/p4fd9j-17d

  2. Clootie says:

    The Far Right and the Far Left are almost identical – plenty of books on that topic.

    However to deny a Neoliberal drive is at the minimum foolish. Small groups work together to build wealth and then move on to gather power and thereby influence. They then turn on each other with a smaller (stronger) group and the circle continues to diminish. Only the most ruthless will survive

    3 years ago 85 people had more of this planets wealth than the poorest half of the world population combined. That figure has now dropped to SIXTY FIVE people.(In just three years)

    The wealthy communist of the old USSR and the American Republican Billionaire have much in common – greed.

    They have their willing puppets such as Tony Blair. A pauper in their eyes but a useful fool.

    With each passing decade we march closer to the abyss foretold by George Orwell.

    One of the reasons I supported Independence is that a smaller nation can resist the march of the mighty more effectively.

  3. flit2013 says:

    Orwell did not foretell the current dystopia but Huxley did. Brave New World is the corporate state with Gramsci’s self reinforcing elites written all over it. Neoliberalism is basically the Chicago School plus a few post Keynes Cambridge economists. The results of the Chicago Boys participation in 1970s Chile was exactly what they wanted. Just because their predictions didn’t work didn’t mean the dogma was not successful on a personal level. They got rich and they got powerful. Capitalism has always pretended to be about efficiency when it is really about plutocracy replacing democracy. Of course neo-liberal theory doesn’t work – so what – that was never the real objective. What we have in terms of wealth accumulation and distribution was…

  4. DR says:

    Great review. Sounds like an interesting book, and ‘we’ certainly need a great deal of accessible writing on the nuts-and-bolts of the current situation. It’s not at all uncommon, though, for economic narratives to be utterly out-of-step with (and indeed, used to disguise) economic realities. The *idea* of neoliberalism is dangerous precisely because it draws fire from what is really being done – as it is, of course, constructed to do. Its virtues and homilies have less than nothing to do with the practices of late capitalism, a disjunction which both comforts the ignorant and confuses detractors. What is even more dangerous, however, is its promotion of the fantasy that the global economy develops in response to some sort of plan, or with some sort of conscious input (from e.g. governments). Naturally, the development of neoliberal ideas followed the practices described: ‘we’ (including the 1%) are so far behind the game that we’ve had to evolve this pseudo-religion of invisible hands and supernatural ‘forces’ to retain some fiction of security. The ritual structures (propitiation, sacrifice, scapegoating, received wisdom from banker-priests in their unassailable inner sancta, dogma, apocalyptic warnings, and above all, faith – notably, in the UK, that the housing market will always save the ‘worthy’, and that the ‘worthy’ are those it saves! – directly opposed to ‘heresy’) are all very clear.

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