On the other side of the Pacific, bloggers are arguing over something called ‘left neoliberalism’. What began as a dispute over monetary policy between Yglesias and Doug Henwood quickly widened into a debate over political philosophy and strategies to rebuild the American left. But what is ‘left neoliberalism’?
Recently Yglesias’ left leaning readers have been complaining about his shift to the right. Freddie DeBoer says Yglesias was once his favourite blogger but now he has capitulated to the establishment: "He is now one of the most vocal of the neoliberal scolds, forever ready to define the ‘neoliberal consensus’ as the truth of man and to ignore left-wing criticism."
Other readers feel the same way: "Yglesias, both in substance and tone, has become much, much less left wing and much more neo-liberal and rightwing", writes Derek. "I stopped reading him regularly last winter and stopped reading him altogether about 2 months ago", says TR Donoghue, "he had, in my mind, become completely a creature of his privileged background and Washington bubble."
Last year Yglesias gave in and accepted the ‘neoliberal’ tag. But he refuses to accept that his views are right wing. In response to DeBoer he hit back : "while I’ll cop to being a ‘neoliberal’ I don’t acknowledge that I have critics to the ‘left’ of me."
So what does it mean to be a left neoliberal? According to Yglesias, it’s about maintaining egalitarian values while embracing free market policies usually championed by the right. As he wrote last year:
What you see around the world is that policies of economic “neoliberalism”—fiscal discipline, controlled inflation, private ownership of businesses, openness to trade and investment—succeed in producing growth. In principle, this growth can make everyone better off. But what leaders like Lula, or the post-Pinochet leftwing governments of Chile, or Bill Clinton, or the Blair and Brown governments in the UK bring to the table is to actually deliver on that promise through tax and welfare policies that ensure growth is broadly shared.
Yglesias major concerns are not about redressing the power imbalance between labour and capital or curbing the power of multi-national corporations. He’s not even that interested in debating the size of government. In March last year he wrote:
… progressive efforts to expand the size of the welfare state are basically done. There are big items still on the progressive agenda. But they don’t really involve substantial new expenditures. Instead, you’re looking at carbon pricing, financial regulatory reform, and immigration reform as the medium-term agenda. Most broadly, questions about how to boost growth, how to deliver public services effectively, and about the appropriate balance of social investment between children and the elderly will take center stage.
What’s left are technocratic debates about particular policies. It’s an approach that leans heavily on economics. And that’s what the dispute over monetary policy was about. Asked to nominate the single best thing Washington could do to jumpstart job creation, Yglesias suggested the Federal Reserve’s Open Market Committee should "announce a plan to target inflation at 3 or 4 percent."
When some liberals argued that the left should join the struggle against greed and materialism Yglesias huffed : "Anti-materialism on the left tends to reflect, I think, a kind of moral vanity." His own position is simple and unashamedly materialistic. In a 2005 piece for the American Prospect he wrote:
I like Depression-era Congressman Maury Maverick’s definition of liberalism as “freedom plus groceries.” Not just groceries, of course, but stuff—material goods—in general. The genius of liberalism as freedom plus groceries is that it identifies the doctrine with things people like. Generally speaking, people want to be free to do what they want. But mere freedom—in the sense of absence of coercion from the government—often isn’t good enough. Someone with no money is allowed to do all kinds of things, but he or she can’t actually do them. Hence the desire for more stuff, which is exactly what liberalism—at its best—aims to provide.
With this kind of blunt, no nonsense approach to freedom you might think that Yglesias has little time for political philosophy. And in a way that’s true. He adheres to philosopher Richard Rorty’s "first projects, then principles" approach to politics. It’s difficult for people who haven’t studied philosophy to understand what Rorty is up to. But when it comes to politics, he insisted that one thing the American left did not need more of was philosophy. What he thought the left really needed was a set of concrete projects would unite the left in a campaign against inequality. Yglesias writes: "I was sufficiently influenced by Rorty’s thinking to decide that even though I really enjoyed taking philosophy classes, I didn’t really think ‘doing philosophy’ was a worthwhile activity."
Rorty’s attacks on theory saw him denounced as a ‘left conservative‘ by cultural theorists like Paul Bové. And now Yglesias is being denounced as a left neoliberal. Perhaps he should be pleased.
Related links
Quick links: What is ‘left neo-liberalism’, and is it politically viable? Matt Cowgill, We are all dead
A debate has broken out across various left-leaning policy blogs about the virtues of a technocratic view of politics versus one that revolves around mobilising organised interests. It’s a fascinating discussion about the means and ends of progressive politics.
The problem with “left” neoliberalism. Chris Bertram, Crooked Timber
I think that something like Yglesias’s general stance would be justifiable if you believed in two things: (1) prioritarianism in the Parfit sense and (2) that real (that is, inflation adjusted) income levels reliably indicate real levels of well-being, at least roughly.
Towards a Liberal Critique of Left Neo-Liberalism Policy. Mike Konczal, Rortybomb
… we should provide a reference to define neoliberalism. For academic purposes, I like Foucault’s definition, taken from the 1978-1979 “The Birth of Biopolitics” lectures given at the Collège de France. Here neoliberalism “does not ask the state what freedom it will leave to the economy, but asks the economy how its freedom can have a state-creating function and role, in the sense that it will really make possible the foundation of the state’s legitimacy.”
Left neoliberalism? David Ruccio, Ocassional links & commentary
For me, the neoliberalism in “left neoliberalism” is taking for granted the idea of neoliberal governmentality (as articulated by, among others, Wendy Brown 1): that the state responds to the needs of the market, that the state itself is governed by a market rationality, and that individual subjects are constructed as entrepreneurial actors.
Liberalism and its Discontents. Kevin Drum, Mother Jones
Back in the 90s, if you’d asked me what my political persuasion was, I probably would have said I was sort of a neoliberal (in the American, Charlie Peters-ish sense of the word). My political leanings are liberal, but my temperament is technocratic and market oriented, and that made me a pretty good fit for the neoliberal team.
Neoliberalism’ – The ideology of pragmatism, Don Arthur, Club Troppo
According to deBoer "the nominal left of the blogosphere is almost exclusively neoliberal". But Australian readers shouldn’t assume they know what this means. The term ‘neoliberal’ has a peculiar history in the United States where it often refers to a precursor to the Third Way.
The ideology that dare not speak its name. John Quiggin, Crooked Timber
The set of ideas that has dominated public policy around the world for the last thirty years has been given a variety of names – neoliberalism2, economic rationalism, the Washington Consensus, Reaganism and Thatcherism being the most prominent. Broadly speaking, this set of ideas combines support for free market (or freer market) economic policies with agnosticism3 about both political liberalism and the relative merits of democracy and autocracy.
The origins of neoliberalism. Don Arthur, Club Troppo
Andrew Norton wonders how the term ‘neoliberalism’ came to Australia. After searching the literature, he thinks it "probably started in Latin America, and came to Australia via US academia".
The Freiburg Boys. Don Arthur, Club Troppo
What if we decide to give the ‘Freiburg Boys‘ equal status with the Chicago Boys? What if we decide that West Germany really was an example of neoliberal reform and not some aberration? Much of the argument against neoliberalism hinges on the decision that Chile is a better example than West Germany.
In the US, ‘neoliberalism’ was originally a centrist and modernising force from the left, along the lines of Hawke and Keating here, rather than the more radical small goverment ideology that leftists and academics here mean when they use the term (though as I have long maintained, this is based on an inaccurate account of both what ‘neoliberals’ believed and what actually happened in government).
I’m struggling with how he can square “progressive efforts to expand the size of the welfare state are basically done” and his stated desire to “deliver…through tax and welfare policies that ensure growth is broadly shared”.
Given the income inequalities that do exist now in the U.S., it’s hard to see how there could be any move towards growth being ‘broadly shared’ there without measurable expansion of the size of its welfare state. Including the need for publicly funded health insurance.
Andrew – Yes, that’s what Kevin Drum is alluding to when he writes:
In 1983 Charles Peter wrote:
In this kind of neoliberalism the ‘neo’ is attached to ‘liberalism’ in the American sense (ie progressive or left of centre). It was associated with magazines like the Washington Monthly and the New Republic.
Randall Rothenberg’s book The Neoliberals is a good source.
But in the debate sparked by Yglesias, it’s not that simple. Some bloggers who are calling Yglesias ‘neoliberal’ aren’t thinking about Washington Monthly neoliberalism, they’re referencing thinkers like Foucault (eg Mike Konczal and David Ruccio).
This makes things even more confusing. In the Birth of Biopolitics Foucault identifies two neo-liberalisms — German and American. Neither has anything to do with Washington Post/TNR neoliberalism. He focuses on German neoliberalism (ordoliberalism) “because it seems to me to be more important theoretically than the others for the problem of governmentality” (p 79).
There’s more on these issues in some of the links I’ve put at the bottom of the post.
Wiz – You could argue that there’s plenty of spending in the US budget that could be cut or trimmed to free up funds for redistribution or spending on targeted initiatives in education, health care etc.
US spending on health care isn’t as efficient as it could be. You could argue that by reforming (or replacing) Medicare, you could make more resources available for low income Americans.
Cuts to things like agricultural subsidies, defence spending and non-means tested benefits might also free up resources.
And by investing in early childhood education and care, you might reduce the proportion of the population that require income support in order to reach a decent standard of living. That might allow welfare payments and in-kind benefits to be increased.
Those are the kind of arguments I’d expect a ‘left neoliberal’ to use.
“So what does it mean to be a left neoliberal? According to Yglesias, it’s about maintaining egalitarian values while embracing free market policies usually championed by the right…..”
Don this is fantastic. This is a breakthrough. This is what I have been campaigning for on Ozblogistan since 2005. I’m sure by lifting the lid on this sort of thing you are risking getting hammered by both sides of the crony-communist status quo.
We ought not be leaving our mates behind. But we ought not be holding them back either. Small-government, partial-and-patient redistributionism is the only authentic Athenian choice for us.
Does this ‘left neo-liberalism’ represent a loss of faith in achieving social justice through the state generally? Or is it an attempt to reform a dysfunctional US state to make it less hostage to narrow well-funded sectional interests at the expense of the broad mass?
As Andrew observed above Hawke and Keating represented this stream in Australia nearly three decades ago. But it seems to me the US left has never really progressed beyond Johnson’s Great Society or even Roosevelt’s New Deal. They need to modernize if they are to head off the absurd marriage of convenience between the far right libertarians and their Tea Party pawns.
As it is in America, you have a hugely inefficient and cumbersome state apparatus laid over a brutalist market economy.
The ‘ordoliberalism’ of Germany is closer to what happened in Australia than the ‘neoliberalism’ of academic imagination.
One of my failures as Policy editor was that I could never get someone to have a go at an article explaining why liberalism almost never appears on its own as a major political force; market liberalism is always with conservatism or social democracy in the west, and sometimes with more authoritarian politics in Latin America and Asia.
Mr D – Speaking of social justice, have you seen Yglesias’ post on Glenn Beck, social justice and the churches?
Well I’d have to agree with the proposition but where are the major policy shortcomings that need addressing?
Firstly how much can we trust central bankers with money creation and are the Austrians right to point out that those who get their hands on it first (ie the Morgan Sachs Macquarie crowd) do very handsomely whilst by the time it trickles down to the multitudes it’s slim pickings or simply inflation that their wages always lag.
Secondly how much taxation has been wasted chasing rainbows with global warming? That is most evident with solar feed-in buyback schemes and the recent hasty retreat from such costly reshiftable energy programs. NSW was the most profligate with 60c/kwhr gross buy-back yet not even a Coalition Govt was game to make the unwinding retrospective after Labor had seen the writing on the power bills. Plenty more profligacy where that came from and the usual howls when fiscal reality demands withdrawal of ill thought out policies in the first place. Simply belated recognition of middle class welfare from the outset.
Thirdly are the plethora of policies that lack any substantive outcomes. Setting up Fuelwatch and Grocerywatch Depts springs readily to mind and we can think of many more such exercises in feel good futility. Classic cases of ignoring market based realities for what purpose? OTOH emulating private markets with public housing makes a lot of sense by setting up a secondary market for qualifying tenants to bid likewise, both with their real dollars and behavioural reward dollars earned as good tenants. Always a scarcity of public housing coupled with maintenance headaches but just because tenants are income poor doesn’t mean they are necessarily values poor or not aspirational. Not the way rationing system works nowadays though. Markets can address these shortcomings and we also have an existing private RE sector to manage it at much lower marginal cost than any bureaucracy could.
So what’s my definition of a neoliberal? One who sees money as not growing on trees but nevertheless likes trees and wants the outcomes of conservatives for all by emulating what works for conservatives and only after they’ve got the most efficient and effective outcomes with such scarce hard-earned, want to argue about the need for some more.
Andrew at #7: “I could never get someone to have a go at an article explaining why liberalism almost never appears on its own as a major political force…”
Ah yes. No one ever got fire in his belly about liberalism.
I think I know why but whether I can get it across in a reasonable space is another matter. The net of it is that liberalism is effete; liberalism remains academic because it isn’t coherent.
Let us distinguish two archetypal positions – two worldviews – which I will call “individualist” and “egalitarian”. (Henry Kissinger calls them conqueror and prophet; Thomas Sowell calls them constrained and unconstrained.) Here is a sample of individualist beliefs:
negative freedom (leave me alone)
equality of opportunity
human nature is fundamentally bad
self-reliance
just process
competition
Kant’s price
Those beliefs are mutually coherent, i.e., logically consistent; they (and many more) can be deduced from each other. The egalitarian holds a corresponding set of beliefs, also mutually coherent:
positive freedom (people need assistance to be free)
equality of condition
human nature is fundamentally good
interdependence
just outcome
cooperation
Kant’s dignity.
Those two sets of beliefs, individualist and egalitarian, look like a snapshot of the Kulturkampf of our time – but that’s empirical; I’m being theoretical here.
The liberal, I will define, is someone who wants to hold both positions simultaneously. Now, there is a way to do this. The trouble is, no liberal will wear it. It is hierarchy. The reasoning is as follows.
If negative and positive freedom are to coexist you will need rules as to who gets which kind in what circumstances. Rules must be enforced, which requires hierarchy.
A hierarchy provides, for a given rank, equality of condition and equality of opportunity to rise to the next rank. That is, it enforces equality under rules which provide that equal people be treated equally.
The ranking system, with its incentives and disincentives, allows that people are bad but can be trained to be good.
An individual has independent authority over subordinates but everyone pulls their weight to achieve great things together.
A hierarchy’s justice works by rules but it is too complex for there to be rules for every little thing so appropriately qualified senior ranks must ensure that the just process does actually deliver a just outcome – namely, to each his due.
A hierarchy is where one cooperates with superiors and competes with peers.
The individualist will sell his grandmother if the price is right (depends on supply and demand). This horrifies the egalitarian for whom things have intrinsic value – which means grandmothers can be extirpated if that serves the greater good. The hierarchy resolves the grandma question by passing motions to appoint a committee of inquiry and seek legal advice.
Those items are only a small sample. There are dozens of others but everything seems to follow that same pattern.
Hierarchy is liberalism’s bête noir. Liberalism began, a couple of centuries ago, in reaction to stifling hierarchy. Of course, real-world liberals recognise that there must be rules but they would never entertain the notion that hierarchy is the resolution of all their conflicting aims.
So liberalism has to stay in the ivory tower, the province of more or less desiccated academics. Very respectable, but incoherent.
That’s my explanation as to why it never appears on its own.
Don, I fully agree that there’s no need to expand the size of government spending in order to better redistribute wealth in the U.S. (or indeed here). But what you’re talking about is cutting back on other areas of spending in order to increase the size of the welfare state (something I fully suppport).
Wiz, that other spending is also welfare, just poorly targeted or spent or both.
I wonder which version of leftism will succeed in claiming the UK looting and riots as evidence for their correctnessof their views?
The gun rights version?
An intriguing description by Mr Pepperday but perhaps taking some liberty with-
“The individualist will sell his grandmother if the price is right (depends on supply and demand). This horrifies the egalitarian for whom things have intrinsic value – which means grandmothers can be extirpated if that serves the greater good.”
A true individualist would immediately appreciate that he should only offer grandma for sale if that’s what she wanted. In which case there’s no harm in intermediation and earning an agreed commission with the balance of the sale price going to the rightful owner. However I’m not confident there’d be an upfront lump sum sale for the obvious (egalitarian wage slaves might like to run that one past their bosses), but there might be a few wanting to pay regularly for the services of an unattached grandma (board and keep and some grannyless kids to look after) It’s all a bit academic because unfortunately too many egalitarians would step in and want her put away in a home and make all the individualists chip in for her upkeep. I wouldn’t exactly call that extirpation but I can see where you’re coming from.
Don, I loved that Yglesias post on Beck. They made one mistake though, describing him as a Mormon. One ‘m’ too many.
Pedro, you can call spending on infrastructure or providing security/defence/police forces/research etc. “welfare” if you want, but it strikes me as diluting the term to the point it’s not longer useful. I’d have a bit more sympathy of considering money spent on providing education/health as a form of welfare (given such services are often provided by private entities, and the government effectivelly just redistributes money to citizens so they can all afford to pay for them), but even then, while you might find a few crazies among the Tea-Party types in the U.S. arguing for abolishment of the welfare state (social security/food stamps/medicaid etc.), it would be an extreme fringe indeed arguing for abolishment of all state-subsidized education.
Wiz, how about this list of govt spending:
health
farm subsidies
education
social security
anything that is pork-barrelling (including some defence)
I think that pretty much covered what Don was saying. All of those are welfare of one form or another and thus are spending that could be better targeted to deliver more to the needy as compared to the demanding.
I don’t know if I’m a loony (only others can really judge), but I’d happily support the complete removal of education subsidies for the wealthy, and you can draw that line pretty low if you like, but the savings need to come as tax cuts. Absent those tax cuts, I look at education subsidies as a second best form of indirect tax cuts for me. Being an employee, I can only get signifcant tax reductions by making money losing investments so I have to hope for middle class welfare to scam off, but really I’d just like lower tax.
Perhaps among the universal set of the eternally restless, neoliberals are best categorised as liberals that eschew mindless positivity-
http://www.smh.com.au/opinion/politics/its-a-blow-but-all-that-positivitys-a-policy-killer-20110809-1ikub.html#ixzz1Uanf6lrE
and naturally that places them much closer to conservatives.
“I’d happily support the complete removal of education subsidies for the wealthy”
I’ve seen lefties argue the same, and likewise for Medicare.
But I completely fail to see how having a clean division between “those who pay taxes” and “those who receive benefits” is anything other than a recipe for social fracture.
Tying back to the original topic – neoliberalism at least in this country is often associated with or labelled “economic rationalism”. It may well be economically irrational for citizens to both pay taxes and receive benefits at the same time, but I’d strongly suggest it’s exactly the lube that makes the whole system work. We can reduce the cost of that lube certainly, but I doubt we can remove the need for it.
I should add that rather less fortunately ‘pork barrelling’ is also a form of lube that helps the whole system work. Again, we probably can’t remove it completely, but I’d love to see legislation in place to keep it to a minimum.
Farm subsidies I just dont get at all. Is there is *single* worthwhile argument for why we have them or should keep them?
While I wouldn’t actually disagree with you, Observa (#15), you are putting your own meaning onto the words. You couldn’t have said “true individualist” if I’d used Kissinger’s label, “conqueror.” Grandma won’t be asked by warlords and crime bosses. And extirpation is not an exaggeration in a Cultural Revolution or on the Killing Fields.
Such situations are eventually quashed by hierarchy. So I was a bit namby-pamby in my description of hierarchy.
Hierarchy does not hold any values beyond keeping the authority structure intact — which usually translates as “keep the lid on it.” That is the criterion which determines Grandma’s fate: she cops whatever it takes to maintain confidence in the system.
An interesting topic, Don.
Not a bad way to describe my own thinking (and the thinking of more progressive Labor people, Paul Krugman, Nicholas Gruen and most other economists).
For example I am a strong believer in SUBSTANTIVE equality of opportunity – while mostly supporting a sensible fiscal discipline (except where there is high cyclical unemployment), private ownership of businesses (where there is effective competition), openness to trade and investment and so on.
I accept that it is hard to apply in practice.
Wiz, I think it mainly just lubes the voter not the taxpayer. I think that the system works because most people are decent and like a law-abiding society. I’m not sure, but I’d be surprised if anyone could dig up much evidence that welfare states create social cohesion. I think that social cohesion exists, but other things support or undermine it. Have a look at the frogs, who have plenty of welfare but take to the streets quite happily.
There’s an interesting discussion of the growth of the welfare states in a book I’ve got about the history of Europe after the war. I think it’s called Post War and is not very old.
Except I didn’t say welfare states *create* social cohesion, just that an important part of cohesion is the avoidance of dividing society into “givers” and “takers”.
wizofaus, I appreciate your point, but I’m not sure it’s so black and white between “givers” and “takers”. All of us avail ourselves of the services of the state in some way – through policing, roads, infrastructure and through our purchase of the services and products of those educated by the state. So I’m not sure you can demarcate in that way.
While of a leftist persuasion, I concede the value of a meritocracy and think society should reward effort and punish sloth. But I also sincerely believe we all benefit by believing there is some merit in people above the market price they can charge for what they produce.
And I believe that believing in a wider good is a good in itself. I genuinely can’t see how we progress as a society without a belief in something above us as self-seeking individuals, a creed that I find depressing in the extreme.
I count many libertarians among my friends and I respect their views. But I still think the light on the hill, however you may scoff at it, represents something greater than the sum desires of our individual selves.
Mr Denmore, I was going to qualify one of my posts with the same point, however I think there’s a significant psychological difference to benefits that are given to use as individuals (transfer payments, subsidized medical/education treatment) and benefits that more obvioulsy go to the community as a whole.
“Except I didn’t say welfare states *create* social cohesion, just that an important part of cohesion is the avoidance of dividing society into “givers” and “takers”.”
I expect that the vast majority of the people who pay the vast majority of the taxes don’t for a second feel better about it because some of the money comes back to them. I know I’m a giver. But I guess that at least implicit in your thinking is the idea that the welfare state might harm social cohesion unless everyone feels that they are getting something from it. I think that at least some versions of the welfare state will potentially harm social cohesion by encouraging envy and entitlement.
An interesting question is how you judge that a society has high levels of social cohesion. I expect you’ll feel you’re seeing it when large groups indulge in voluntary activities, whether getting excited by a sporting triumph, a popular reaction to a local movie, or pitching in to clean up after a flood or donate to a disaster relief fund. Clearly you can’t see it in tax collections, or the ATO would not have the most oppressive powers of enforcement in the land.
“And I believe that believing in a wider good is a good in itself. I genuinely can’t see how we progress as a society without a belief in something above us as self-seeking individuals, a creed that I find depressing in the extreme.
I count many libertarians among my friends and I respect their views. But I still think the light on the hill, however you may scoff at it, represents something greater than the sum desires of our individual selves.”
I think maybe you are missing an important point. The libertarian idea is that the state should first respect people as individuals and that individual rights are the preeminent rights, something you will likely support if the discussion turns to slavery or conscription. I don’t know if you are referring to god, but as an atheist I can say that I don’t think of other people as self-seeking individuals, just as people. The vast majority of us are considerate of and helpful to others, including no doubt your libertarian friends, otherwise you probably would not like them. The only difference between you and libertarians is that you think a better society will be made if a degree of central control is exercised to take from some to give to others. Personally, I don’t think you create a moral order by forcing x to give property to y. There may be good reasons for doing so, but they are not moral reasons.
In other words, you see it when everybody sees themselves as being in the same boat, despite individual differences. I may earn somewhat more than some of my friends etc., but we are all contributors towards AND beneficaries of the welfare state. Anyway, I’m not sure how one proves how important that is, but the fact is that all successful social democrat states function this way.
Yes, but to repeat myself, I think that’s because politicians are trying to create coalitions of voters through the distribution of benefits. Especially seeing the vast majority if income tax is paid by a relatively small percentage of taxpayers.
http://www.cbo.gov/publications/collections/taxdistribution.cfm
I don’t feel any greater sense of community for being a recipient of churn, in fact I would much rather pay less tax full stop personally.
[…] recent debate over Matt Yglesias’ ‘left neoliberalism’ reminded me what an ambiguous term neoliberalism is. There are at least five political movements or […]
FFS, Yglesias was BORN into the establishment. He comes from one of New York’s toniest old establishment families, following his mother and father and grandmother and grandfather, and great grand-father to Dalton School then Harvard. This guy has never seen outside the establishment bubble.