Neoliberalism- what comes next?


Regular readers of this blog will know that I have written a lot about the political-economic status quo- if indeed there is such a thing in these times of economic turmoil. Some of this has been about challenging some of the ‘common sense’ truisms that we have become so used to that we hardly question. Some of too has been my way of expressing frustration and protest in the face of manifest injustice – a system in which the rich get richer, live longer, are better educated etc etc, whilst the poor are blamed as feckless and ‘skyvers’.

Throughout I have also felt this constant desire to see an alternative- a better way to organise our commercial fiscal and tax system. I can catch glimpses of this, in small things between individuals and groups, but the system will tell us that what we have, beyond a bit of tweaking, is as good as it can get.

It is this kind of thinking that allows those of us that call ourselves followers of Jesus to also accept greed, avarice, unjust economic relationships and exploitation as somehow morally justifiable, even necessary components of our society.

Egalitarianism, redistributive taxation and collectivised centrally controlled economies- these have been proved to be bankrupt ideas (we are told) which stultify and stagnate entrepreneurialism and innovation. We only have to look at the failure of communism, and the spectre of British industry circa 1976.

I came across an article in a journal called Soundings, which is a left wing journal interested in a new kind of politics. They are publishing a book online, a chapter a month, called After Neoliberalism? The Kelburn Manifesto.

The first chapter is available here– and sets the scene with some analysis of where we are now. It makes as much sense as anything I have read for some time. Here are a few extracts;

Every social settlement, in order to establish itself, is crucially founded on embedding as common sense a whole bundle of beliefs – ideas beyond question, assumptions so deep that the very fact that they are assumptions is only rarely brought to light. In the case of neoliberalism this bundle of ideas revolves around the supposed naturalness of ‘the market’, the primacy of the competitive individual, the superiority of the private over the public. It is as a result of the hegemony of this bundle of ideas – their being the ruling common sense – that the settlement as a whole is commonly called ‘neoliberal’…

Ideology plays a key role in disseminating, legitimising and re-invigorating a regime
of power, profit and privilege. Neoliberal ideas seem to have sedimented into the
western imaginary and become embedded in popular ‘common sense’. They set the
parameters – provide the ‘taken-for-granteds’ – of public discussion, media debate
and popular calculation.

One key strand in neoliberalism’s ideological armoury is neoliberal economic
theory itself. So ‘naturalised’ have its nostrums become that policies can claim
to be implemented with popular consent, though they are manifestly partial and
limited. Opening public areas for potential profit-making is accepted because it
appears to be ‘just economic common sense’. The ethos of the ‘free market’ is taken
to licence an increasing disregard for moral standards, and even for the law itself.
Commercialisation has cultivated an ethos of corruption and evasiveness. Banks,
once beacons of probity, rig interest rates, mis-sell products, launder drug money,
flout international embargoes, hide away fortunes in safe havens. They settle their
‘misdemeanours’ for huge sums that hardly dent their balance sheets. Similarly,
when private firms that have been publicly contracted fail to meet targets they are
allowed to continue. Graduates stacking supermarket shelves are told they don’t
need to be paid because they are ‘getting work experience’. Commercialisation
permeates everywhere, trumps everything. Once the imperatives of a ‘market
culture’ become entrenched, anything goes. Such is the power of the hegemonic
common sense.

All this strikes me as a good analysis of the heart of our culture- one that has been shaped by the ‘common sense’ that we have been given. It is really hard to challenge this kind of hegemony – even in our selves, our own understanding, our own lifestyle, let alone that of other people.

What is needed is a new kind of ‘common sense’. A new kind of way of understanding the world that we live in, and the economic relationships we have with one another.

Christians already have this of course- what I would term the common sense of the New Kingdom. This kind of common sense values people before profit, seeks to form relationships of love and service. Quite how Christianity became so intertwined with Capitalist Colonialism I have no idea. Other than at some point we decided that being like Jesus was simply impracticable- against common sense.

It will be interesting to watch the unfolding to the Kelburn Manifesto to see if the left might yet have something to teach Christians…

Economic growth; lie number two…

How do we know that we are in recessiondouble dip or triple dip as it may be? What mysterious yardsticks are used in the Bank of England to make them reach for the strings on which we all dangle?


Above all, it is this one; Economic Growth.

Economic growth usually refers to the growth in value of GDP (gross domestic product).

The total output of the country – the value of all the food produced, all the pharmaceuticals manufactured, cars assembled and services rendered – forms GDP.

GDP also takes into account the effect of imports and foreign investment.

If GDP is bigger this year than last year, then the UK is experiencing ‘economic growth’.

But inflation will also have driven up prices since last year, and thus GDP. To assess whether the economy is actually growing, the rate of inflation has to be subtracted from the nominal rate of growth to get the real rate of growth.

Lets be clear about this- economic growth happens when the overall value of what have, what we make, what we own, gets bigger. Our system is set up to be always dissatisfied with what we have, with what we are. No growth is regarded as stagnation, shrinking is recession, and recession is to be avoided at all costs- particularly at the cost of those who have the least.

We can only have economic growth if we continue living the kind of lifestyles that we are living now- if we continue spending money on the next gadget, another car, the latest trend in exotic food, the newest cut of skirt and suit. We can only have economic growth if we exhibit enough collective desire for new bathrooms, conservatories, paved driveways.

Increasingly we can only have economic growth if we can persuade other people to be just like us– to want the things that we want, the food that we eat, the mobile phones that we have glued to our ears. And so was born the globalisation of markets; the ubiquitousness of product. The penetration of our ways of being into every far corner of the earth.

Is this a problem?

Well, perhaps we need to distinguish between different periods of economic growth. In the UK we went from being an agrarian economy, whose countryside could only support a certain population number to being a place of canals, coal mines, factories and population explosion- all in the space of around 100 years. During this time our economy was growing exponentially- rather like that of China now. Victorian Britain was a place of huge inequality and the accumulation of vast wealth by the few on the backs of the labour of many. Like China now.

Of course to achieve this continued economic growth, Britain also needed an export market and control of sources of cheap natural resources-  for this we colonised and enslaved half the world.

More recently our economic growth has slowed- we achieve figures of one, two, three percent, and call it success. This ‘success’ is nothing to do with society changing, but everything to do with a desire to stay the same. Our growth is conditional on the pursuit of technological innovation by those who would sell us more product- rendering those we already have as obsolete.

Economists have a word for our willingness to spend- to slap down the cash rather than salting it away- they call it confidence. A healthy economy is full of confident consumers. Or, as Wikipedia put it;

Schumpeterian growth is an economic theory named after the 20th century Austrian economist Joseph Schumpeter. Unlike other economic growth theories, his approach explains growth by innovation as a process of creative destruction, which captures the dual nature of technological progress: in terms of creation, entrepreneurs introduce new products or processes in the hope that they will enjoy temporary monopoly-like profits as they capture markets. In doing so, they make old technologies or products obsolete: this is the destruction[disambiguation needed] referred to by Schumpeter, that could also be referred to as the annulment of previous technologies which makes them obsolete, and “which destroys the rents generated by previous innovations” (Aghion 855).


Now, back to the LIE that are at the centre of all this. We are told that for our economy, even our society, to survive and prosper, we have to have sustained economic growth. The spectre of the Great Depression hangs over us- lives ruined, people starving in the streets. Economic growth is a holy cow that we have to keep feeding.

Everywhere we hear people asking questions of this cow however;

  • Is it sustainable? Can we really just keep producing more and more? Are we not burning up our resources at an alarming rate? Are we not slowly poisoning our planet with it all?
  • Is it fair? Can we really continue to live in a world where our lifestyles are dependent on the raw materials and cheap labour of others who are half way across the world?
  • Is it working? Given the instability in the system, can we really trust it to maintain our lifestyles? Is it not all just coming unraveled anyway?
  • Is it not just terribly wasteful? Do we really need all this stuff? Is there not a simpler way to live?
  • Is it making us happy, fulfilled, complete?

The relationships between economic growth and equality within society is one that has been the cause of much argument- think about the Marxist analysis, or of recent arguments that suggest that stable economic growth always leads to greater equality.

The argument has taken a new turn recently however- this from here;

Labour is drawing on research by the New Democrat Network (NDN) central to the Obama re-election campaign to shape its own election thinking.

The research was described by the Obama campaign as its North Star. It tracked three trends in the US economy between 1992 and 2009, showing how two – higher growth and higher productivity – had not been matched by a rise in living standards for the majority…

Douglas Alexander, the shadow foreign secretary and a close student of US politics, told the Guardian: “Back in 1992 the famous dictum of Bill Clinton’s adviser James Carville was: ‘It’s the economy, stupid.’ It contained the implicit assumption that economic growth ensured rising living standards.

“Today that no longer can be taken for granted, as this important research by NDN and the Resolution Foundation shows. I’ve worked closely with the NDN in recent years and that collaboration confirms to me this is one of the defining challenges for today’s progressives on both sides of the Atlantic.”

Similarly, work in Britain maps how growth before 2008 did not guarantee a rise in living standards, and how the bottom half of society suffered. UK wage stagnation is more recent than in the US – theirs started in the 1970s, the UK’s in the early 2000s.

And that is just within our own society. No mention of this sort of thing;


So, what is the alternative? Can our society, our economy, really kick our addiction to economic growth as the primary measure of our worth?

What might replace it?

Can commerce ever be based on a fair exchange of skills based on need (although surely there is always room too for celebration, for art, for pleasure.)

Can we learn to live in ways that are sustainable- that only cost the earth what it can afford to give to us?

If the answer to these questions are ‘yes’ (and I deeply hope that they are) then might these not result in negative economic growth?

Because in the Kingdom that Jesus talked about, things often get turned upside down and inside out- the last become first and the least of these become the keys to the Kingdom.

The Kingdom of God is not interested in statistics, in abstract measurement- it is rooted in the here and now- the shit and blood and spit of being ME, and my individual relationship with you. Everything else just gets in the way.