Neoliberalism and the politics of the crisis

[lwbooks.co.uk] 

For three decades, the neoliberal system has been generating vast profits for multi-nationals, investment institutions and venture capitalists, and huge accumulations of wealth for the new global super-rich, while grossly increasing the gap between rich and poor and deepening inequalities of income, health and life chances within and between countries, on a scale not seen since before the second world war. In North America and Western Europe – hitherto dynamos of the global economic system – rates of growth are now lower than during the early post-war decades, when there was a more even balance of power between the social classes. There has been a steep decline in manufacturing and a hot-house expansion of financial services and the service economy; and a massive shift of power and resources from public to private, from state to market. ‘The market’ has become the model of social relations, exchange value the only value. Western governments have shown themselves weak and indecisive in responding to the environmental crisis, climate change and the threat to sustainable life on the planet, and have refused to address the issues in other than their own – market – terms.

Likewise, the financial crisis has been used by many Western governments as a means of further entrenching the neoliberal model. They have adopted swingeing ‘austerity measures’ which, they claim, is the only way of reducing the deficits generated during the bonanza period of the 1980s and 1990s. They have launched an assault on the incomes, living standards and conditions of life of the less well-off members of society. In the UK, the cuts programme has frozen incomes, capped benefits, savaged public sector employment and undermined local government. It has encouraged private capital to hollow-out the welfare state and dismantle the structures of health, welfare and education services. The burden of ‘solving’ the crisis has been disproportionately off-loaded on to working people, targeting vulnerable, marginalised groups. These include low-income, single-parent families; children in poverty; women juggling part-time employment with multiple domestic responsibilities; pensioners, the disabled and the mentally ill; welfare-benefits and low-cost public housing ‘dependants’; the young unemployed (especially black youth); and students. Youth facilities have been closed; and citizens who depend on public amenities for their social well-being find themselves bereft. Apart from its punitive and regressive social effects, this is a strategy destined to fail even in its own terms, since its main consequence will be a serious fall in demand and a collapse of tax revenues, deepening the downward economic spiral, with little fall in the deficit.

In other words, the crisis itself has been used to reinforce the redistribution from poor to rich. Moreover, it has also provided the alibi for a far-reaching further restructuring of state and society along market lines, with a raft of ideologically-driven ‘reforms’ designed to advance privatisation and marketisation. It has encouraged private, individualised solutions to social problems. This makes it all the more important for the left to make the argument that it is time for a new moral and economic settlement.

The above text is an excerpt from After neoliberalism: analysing the present (pp. 3-5) by Stuart Hall, Doreen Massey and Michael Rustin, the first chapter and framing statement of their edited book After Neoliberalism? The Kilburm Manifesto which is published by Soundings: A journal of politics and culture.