Neoliberalism: what’s it all about?

Margaret Thatcher and Ronald Reagan were the movement’s standard bearers. ROBERT HUFFSTUTTER via cc

28 April 2021

By Peter Moss and Guy Roberts-Holmes

In his foreword to our new book, Neoliberalism and Early Childhood Education, published today, Professor Stephen Ball offers a stark assessment: ‘neoliberalism now configures great swathes of our daily lives and structures our experience of the world – how we understand the way the world works, how we understand ourselves and others, and how we relate to ourselves and others.’

It has reached, as we will describe in our next blog, deep into all sectors of education – and far beyond. Whether it’s schools or bus services competing for custom, or the privatization of public utilities and the sub-contracting of public services to big business, or the marginalization of trade unions and the vaunting of a ‘flexible’ labour market, or the turning over of care for older people to private providers, neoliberalism has become the normal backdrop to life, appearing natural and self-evident. How else, we might ask, could things be?

Yet despite its enormous influence on all aspects of our lives, many people today can neither name nor describe neoliberalism, which, as openDemocracy co-founder Anthony Barnett puts it, ‘contributes to its influence and success – just try to oppose something that you cannot name’.

So what is neoliberalism? It is been described as a ‘thought collective and a political movement combined’ that lays claim to understand how human life works and what needs to be done to bring about an ideal future. At the heart of neoliberalism is the ’economisation’ of everything, described by American political theorist Wendy Brown as ‘the conversion of non-economic domains, activities and subjects into economic ones extend[ing] market metrics and practices to every dimension of human life; political, cultural, personal, vocational, educational.’

Everything becomes economic, even human relationships, all reducible to economic valuation and transactions. Central to these transactions is the creation of markets where sellers and buyers can be brought together to trade anything and everything, and where neoliberalism’s prime values of competition, individual choice and calculation can work their supposed magic.

Neoliberalism not only turns everything into a tradable commodity. It also ‘thoroughly revises what it means to be a human person’, calling forth a very particular image of the individual. This ideal neoliberal subject is an economic being – homo economicus, self-interested and competitive, independent and self-reliant, an informed consumer constantly calculating for every aspect of life what is in her or his best interests, and with ‘every kind of human activity [reconfigured] in terms of rational self-investment and entrepreneurship.’ She or he must be constantly ready for whatever new twist or turn takes place in the economy and employment, infinitely flexible and responsive to the changing needs of the market, an entrepreneur of the self: as Stephen Ball puts it, ‘malleable rather than committed, flexible rather than principled – essentially depthless’.

These ideas are not new. But they have become increasingly influential across the world since the 1980s, spreading out from the neoliberal movement’s epicentres in the UK and USA. Margaret Thatcher and Ronald Reagan were the movement’s political standard bearers, but they were backed by a dense network of influencers – individuals, think tanks, university departments and international organisations. One of the most important of these influencers was the economist Milton Friedman, who set out the neoliberals’ strategy back in the 1960s, when the ideology still had little influence:

Only a crisis – actual or perceived – produces real change. When that crisis occurs the actions that are taken depend on the ideas that are lying around. That, I believe, is our basic function: to develop alternatives to existing policies, to keep them alive and available until the politically impossible becomes politically.

So Friedman and the rest of the thought collective were ready when the economic crises of the 1970s turned neoliberalism from the politically impossible to the politically inevitable.

The neoliberal movement draws on other ideas. ‘Human capital’ theory, first articulated in the 1950s, has become immensely influential today referring to the knowledge, information, ideas, skills and health of individuals, all the capacities needed for economic success. Gary Becker, a neoliberal economist and early proponent of human capital theory, claimed that ‘this is the “age of human capital” …The economic successes of individuals, and also of whole economies, depend on how extensively and effectively people invest in themselves’.  Another example of ‘economisation’, ‘human capital’ complements the neoliberal image of homo economicus, that essentially economic and entrepreneurial subject.

‘Public choice’ theory has undermined trust in public institutions and public service by claiming people ‘are primarily driven by venal self-interest…[wanting] to control others and take away their resources’ and viewing ‘government as an unfortunate necessity that needed to be constrained at all costs’. While ‘new public management’ has imported the methods of private business into the sphere of public services, including greater competition and an insistence on explicit standards and measures of performance in the interests of output control.

Neoliberalism and its associated ideas are powerful forces that have had an immense impact: it ‘has sunk its roots deep into everyday life.’ But in our new book, we argue that though neoliberalism is ‘deeply problematic’, it is also ‘eminently resistible and eventually replaceable.’ Indeed, neoliberalism has itself now entered into crisis. Its claims about the virtues of markets have been undermined by the 2008 financial crisis and the current pandemic – no one is saying we should leave dealing with Covid to the market. While neoliberalism’s dire consequences for people and planet have become increasingly obvious, as inequality and insecurity have festered, democracy and solidarity have been eroded, and unrestrained markets have hastened environmental disaster. As Nobel prize-winning economist Joseph Stiglitz bluntly concludes, ‘If the 2008 financial crisis failed to make us realise that unfettered markets don’t work, the climate crisis certainly should: neoliberalism will literally bring an end to our civilisation’.

Peter Moss is Emeritus Professor of Early Childhood Provision and Guy Roberts-Holmes is Associate Professor of Early Childhood Education at the IOE. Their new book ‘Neoliberalism and Early Childhood Education: markets, imaginaries and governance’ is just published. A free webinar about the book to be held on May 4 at 1pm can be booked here.

Photo: Robert Huffstutter via Creative Commons