jargon

key concepts
in social
research

neoliberalism
by johanna bockman

“Neoliberalism” is both an approach The term “neoliberalism” originated neoliberal history

to government and a defining political in the 1930s, and it is much more than Most sociologists agree that political
movement today. In both senses, neo- markets, money, and commodities. In leaders began to forge neoliberal states
liberalism is grounded in the assumption Europe and elsewhere, many under- in the 1970s. Capitalism had entered a
that governments cannot create eco- stood the devastation of 1929’s Great series of worldwide crises—the oil cri-
nomic growth or provide social welfare; Depression as having been caused by sis, fiscal crisis, stagflation, debt crisis,
rather, by trying to help, governments the “old” liberalism—laissez-faire capi- and legitimacy crisis due to the wide-
make the world worse for everyone, talism with no role for the state. Thus, spread popularity of socialism—all of
including the poor. Instead, private com- they sought new approaches to big which undermined capitalists’ profits and
panies, private individuals, and, most problems, whether in the form of social- control over the economy. For Marxist
importantly, unhindered markets are ism, state planning of the economy, or scholars like David Harvey, neoliberalism
best able to generate economic growth some form of state regulation. For their was a capitalist response. Capitalists and
and social welfare. Nobel-laureate econ- part, a group of European liberals, most their political allies sought to implement
omist Joseph Stiglitz has criticized this famously Friedrich von Hayek, envisioned neoliberal policies in order to restore the
unrestricted support of free markets and a new kind of liberalism, a “neoliberal- conditions for profitability and capitalist
unrelenting attack on government as ism,” which would preserve laissez-faire power. To that end, politicians privatized
“market fundamentalism.” Since the markets while adding a role for what formerly state-owned industries, sold off
1970s, neoliberalism has shaped policies they considered a minimal state. This public or pseudo-public land, and con-
at international, national, and local levels. minimal state would protect private prop- tracted out former state activities. Market
Recently, the term “neoliberal” erty, maintain order, and provide some actors, particularly corporations, did not
has been extended to a wide range of protection for the poor. In spite of its anti- have to generate new wealth, but could
phenomena: the corporatization of uni- state rhetoric, neoliberal policies were not profit from ownership of entities often
versities, the shift of welfare policy toward meant to eradicate the state, but rather created by former socialist or progressive
philanthropy and entrepreneurship, the to have forged a new kind of state. governments. In addition, corporations
spread of “intensive mothering,” the Most scholars consider a powerful profited from the “commonwealth.”
privatization of state companies, the state necessary to create and sustain a Political philosophers Michael Hardt and
expansion of low-wage service work, minimal state. Only powerful states can Antonio Negri suggest that the collec-
the growth of mass incarceration, and implement policies that deregulate indus- tive goods and experiments in living that
so on. While this list may seem exces- try, relax restrictions on foreign trade and we create together (think of the content
sively broad, the concept of neoliberalism flows of money, privatize state compa- and unpaid labor we put into Facebook
suggests that such economic, political, nies, maintain order through expanding or the community organizing that raises
social, and cultural phenomena world- prison and security systems, and make property values) are appropriated by cor-
wide might be connected to larger “austerity” budget cuts to areas like porations to create new conditions for
transformations in global capitalism. social services, education, and welfare profit and capitalist power.
Neoliberalism manifests itself differently benefits. The Bolivian “water wars” of Philosopher Michel Foucault agreed
in different places, and sociologists use 2000 and the recent uprisings in Greece that neoliberalism brings together
the concept to examine the potential are recent examples of the historically markets and powerful states, but he
connections among these changes violent battles that ensue when states argued that what makes these states
around the globe. are forced to defend these austerity cuts truly neoliberal is using the market
against the protests of their own citizens. to govern, distributing services and

14 contexts.org
 citizenship. In the United States, poli-
ticians transformed criticisms of public
housing into the destruction of public
housing so that low-income people
might be allowed to make “choices”
in expensive rental markets. In this way,
neoliberalism can be very appealing; it
embodies local criticisms, desires, and
experiments in distorted form. Neoliber-
alism often fuses genuine citizen input
Oleg Atbashian, ThePeoplesCube.com

with the devastating effects of capitalism

(increasing inequalities, newly excluded
populations, superficial democracy, and
widespread unemployment) creating
different, though often connected, neo-
liberal phenomena worldwide.
Has the current financial crisis dele-
gitimized neoliberalism? Will it end?
benefits according to the market logic in their own countries. At the same It is difficult to say. In his 1944 book
of efficiency, competitiveness, and prof- time, for the many developing countries The Great Transformation, Karl Polanyi
itability. With these new “technologies defaulting on loans during the debt crisis, argued that attempts to create free mar-
of governance,” the state ensures that the World Bank and the International kets always provoke countermovements
citizens manage themselves (however Monetary Fund made new loans condi- to protect society from these “disem-
badly or well). Sociologist Ulrich Beck tional on neoliberal reforms, which came bedded” markets. We can see now a
has described how citizens are forced to be known as “structural adjustment proliferation of social movements against
to become entrepreneurs in their own policies” based on “the Washington austerity, privatization, and economic lib-
lives, managing choices within a highly Consensus.” Similarly, with the end of eralization as in the Occupy Wall Street
volatile world and taking individual socialism in Eastern Europe in 1989 and movement. American conservatives, for
responsibility for their failures. As the in Russia in 1991, international bankers example, have augmented neoliberalism
state cuts social services, neoliberal sub- demanded “shock therapy”—the imme- with nationalism, militarization, Christi-
jects must compete to find assistance diate implementation of neoliberalism. anity, and social conservatism, creating
from non-governmental organizations, “neoconservatism.” In contrast, Bolivia
religious organizations, microfinance contradictions of neoliberalism and Venezuela’s governments have
institutions, and corporations, all of Neoliberalism is more than just a turned to new forms of socialism. Many
which join the state in networks of right-wing ideology or Americanization states now take a more active role in the
neoliberal governance. Thus, neoliberal (the imposition of American ideas onto development of their economies. Like
societies move from national govern- the rest of the world). Neoliberalism many big concepts, “neoliberalism” may
ment to public-private governance and appears worldwide and comes in many seem excessively broad, but the term illu-
entrepreneurial citizenship. Those who different and contradictory forms. The minates how many changes around the
cannot compete—such as the homeless, Democratic Party in the US, the Labor world and over time might be connected
the incarcerated, or the formerly incarcer- Party in the UK, the Social Democratic in ways of great interest to, and relevance
ated—are excluded from full citizenship, Party of Germany, the Chinese Commu- for, sociologists.
abandoned. nist Party, and other left or left-of-center
Chile was one of the earliest neo- political parties have all implemented Johanna Bockman is in the sociology and anthropol-
liberal testing grounds. In 1973, General neoliberal policies. People around the ogy department at George Mason University. She is
Augusto Pinochet staged a coup and world criticize their governments—for the author of Markets in the Name of Socialism: The
violently implemented neoliberal policies, example, for ineffectiveness, corruption, Left-Wing Origins of Neoliberalism.

dismantling institutions created by the and repression—and long for more con-
previous, democratically elected socialist trol over their lives, more flexibility in their
regime. American president Ronald Rea- work, more free time, and more free-
gan (in power from 1981 to 1989) and dom. Politicians from the right and the
British prime minister Margaret Thatcher left have co-opted and distorted these
(1979-1990) soon realized such policies criticisms and desires into entrepreneurial

Contexts, Vol. 12, No. 3, pp. 14-15. ISSN 1536-5042, electronic ISSN 1537-6052. © 2013 American Summer 2013 contexts 15
Sociological Association. http://contexts.sagepub.com. DOI:10.1177/1536504213499873