Problems of Neoliberalism

By Edward Said

In the decade after the fall of the Soviet Union, most of the world is in the grip of an ideology whose most dramatic embodiment is currently to be found in the race between the two main candidates for the American presidency. Without wishing to list the various issues that divide them, I should like very quickly therefore to note what it is that unites them and in many ways makes them mirror images of each other. As I said in my last article (Al-Ahram Weekly, 24-30 August), both are passionate, indeed unquestioning believers in the corporate free market system. Both advocate what they call less government, oppose “big” government, and together continue the campaign against the welfare state that was inaugurated two decades ago by Margaret Thatcher and Ronald Reagan. It is this 20-year continuity that I would like to describe in view of what has been the emergence and hegemony of neo-liberalism, a doctrine that has almost totally transformed the British Labour Party (now called New Labour) and the American Democratic Party under Clinton and Gore. The dilemma we all face as citizens is that, with few exceptions here and there (most of them desperately isolated economic disasters, like North Korea and Cuba, or alternatives that are useless as models for others to follow), neoliberalism has swallowed up the world in its clutches, with grave consequences for democracy and the physical environment that can be neither underestimated nor dismissed.

As practiced in Eastern Europe, China and a few other countries in Africa and Asia, state socialism was unable to compete with the energy and inventiveness of globalised finance capital, which captured more markets, promised rapid prosperity, and appealed to vast numbers of people for whom state control meant underdevelopment, bureaucracy and the repressive supervision of everyday life. Then the Soviet Union and East Europe switched to capitalism, and a new world was born. But when the doctrines of the free market were turned on social security systems like those that had sustained Britain in the post-war period, and the United States since Franklin Delano Roosevelt’s New Deal, a massive social transformation was to ensue. I will come to that in a moment. But one must make an effort to remember those genuinely progressive policies had once produced a relatively new condition of widespread democratic equality and social benefits, all of them administered and financed by the central state. They were what gave strength to post-war Britain and the United States in the 1940s and 1950s. Taxes were therefore quite high for the wealthy, although the middle and working classes also had to pay for the benefits that accrued to them (mainly education, health and social security). Many of these benefits were the result of an aggressive and well-organised labour union system, but there was also a prevailing idea that the large costs of health and education, for example, which the individual citizen could not afford to pay alone, should be subsidised by the corporate body of the welfare state. By the beginning of the ’90s all this was not only under attack but had started to disappear.

First the labour unions were dissolved or broken (the British miners, and the American air traffic controllers). Privatisation of major services like transportation, utilities, education and heavy industry followed, mainly in Europe. In the US (where except for utilities, most industries were already in private hands, but prices were controlled by the government in the basic services sector), deregulation was the order of the day. This meant that the government would no longer play a role in making sure that the price of travel, basic commodities, health, education, as well as utilities such as gas and electricity, should stay within certain bounds. The market was to be the new regulator, which meant that costs and profits of individual airlines, hospitals, telephone companies, and later gas, electricity, and water were left to the private companies to set, frequently at considerable financial pain to the individual consumer. Soon even the postal service and a major part of the prison system were also privatised and deregulated. In Britain, Thatcherism virtually destroyed the university system, since it viewed each institution university as a supplier of learning, and hence like a business that in terms of profit and loss tended to be a loser, rather than a maker, of money. Many teaching positions were slashed, with an extraordinary loss in morale and productivity, as thousands of professors and teachers looked for positions abroad.

With the collapse of socialism everywhere and the triumph of aggressive right-wing parties and policies such as those headed by Reagan and Thatcher, the old liberal left in British Labour and the US Democratic party had two alternatives. One was to move closer to the successful policies of the right. The other alternative was to choose an approach that would protect the old services but make them more efficient. Both the British New Labourites under Tony Blair and the American Democrats under Bill Clinton chose the former course (moving towards the right), but skilfully kept some of the rhetoric of the past, pretending that many of the welfare services the state used to provide were there, albeit packaged differently.

That was simply false. Deregulation and privatisation continued, with the result that the profit motive took over the public sector completely. Budgets for social welfare, health for the poor and aged, and schools were slashed; defence, law and order (i.e. police and prisons) were fed more state money and/or privatised. The major loss has been in democracy and social practices. For when the country is ruled by the market (in the US a period of great prosperity for the top half of the country, poverty for the bottom) and with the state in fact given over to the most powerful corporations and stock market businesses (symbolised by the tremendous growth in electronic business), there is less and less incentive for the individual citizen to participate in a system perceived as basically out of control so far as the ordinary population is concerned. The price of this neoliberal system has been paid by the individual citizen who feels left out, powerless, alienated from a market place ruled by greed, immense transnational corporations, and a government at the mercy of the highest bidder. Thus elections are controlled not by the individual voter but by the major contributors, the media (who have an interest in maintaining the system), and the corporate sector.

What is most discouraging is the sense most people have that not only is there no other alternative, but that this is the best system ever imagined, the triumph of the middle-class ideal, a liberal and humane democracy — or, as Francis Fukuyama called it, the end of history. Inequities are simply swept out of sight. The degradation of the environment and the pauperisation of huge patches of Asia, Africa and Latin America — the so-called South — are all secondary to corporate profits. Worst of all is the loss of initiative that could bring significant change. There is hardly anyone left to challenge the idea that schools, for instance, should be run as profit-making enterprises, and that hospitals should offer service only to those who can pay prices set by pharmaceutical companies and hospital accountants. The disappearance of the welfare state means that no public agency exists to safeguard personal well-being for the weak, the disadvantaged, impoverished families, children, the handicapped, and the aged. New liberalism speaks about opportunities as “free” and “equal” whereas if for some reason you are not capable of staying ahead, you will sink.What has disappeared is the sense citizens need to have of entitlement — the right, guaranteed by the state, to health, education, shelter, and democratic freedoms. If all those become the prey of the globalised market, the future is deeply insecure for the large majority of people, despite the reassuring (but profoundly misleading) rhetoric of care and kindness spun out by the media managers and public relations experts who rule over public discourse.

The question now is how long neo-liberalism will last. For if the global system starts to break down, if more and more people suffer the consequences of a dearth of social services, if more and more powerlessness characterises the political system, then crises will begin to emerge. At that point, alternatives will be a necessity, even if for the time being we are being told “you never had it so good!” How much social suffering is tolerable before the need for change actually causes change? This is the major political question of our time.

The collapse of capitalism? Time for something else?

Montgomery Bus Boycott of 1956 Freedom Riders

With so many corporations on the dole, banks being bailed out are we not in fact experiencing the collapse of capitalism, well neoliberalism. I seem to remember when the “commies’ were getting short shrift for failing miserably in Russia and capitalism winning out. I don’t remember anybody coming up with ideas about bailing communist institutions out. Keeping communism afloat with public money? Why should we do the same for the “capitalists”? Isn’t the market to decide who sinks or swims. Wasn’t privatisation the idea that it was more efficient and cheaper. Isn’t capitalism about gaining great wealth but also at the risk of loosing as well? Why has that part of the deal disappeared? Why have the poor to take on the failure of capitalism?

But it wasn’t actually communism was it? But it isn’t actually capitalism is it?

The neoliberal totalitarian state
“we were told we were entering a new era, of peace and prosperity and freedom – communism was defeated by capitalism and the free market. But just as they were tearing down surveillance cameras and totalitarian machinery in the eastern bloc, in the West the politicians and media were screaming for more and more authoritarian measures. In the UK as elsewhere there now is no right to silence, no more innocent until proven guilty, cameras monitoring every movement, and new laws which prevent collective gathering and protest. There has been no peace dividend, spending on defence is greater than at any time during the cold war, just as the world has become a much more dangerous place ” (From a reader in Guardian DMC, Australia)

During the US power struggle for president – when Obama was being accused of being a “socialist” Michael Moore the film maker observed. The word socialism has been mentioned more in this country over the last few weeks than it has been over the last hundred years. Maybe, he suggests folk will start looking up socialism in their dictionaries and start to say ‘Hey this sounds quite good, maybe we should try it'”

Is it not ironic that the most oppressive state towards black folk on the planet now has a black man leading it. Will we still be celebrating when Obama starts to roll back probably most of the promise he has made to middle class blacks as he settles in to power. While white people can imagine a fairer world with a black man at the helm the system can proceed practically unaltered for poor people black and white. To imagine otherwise is to ignore the history of imperialism and the history of the black civil rights movement that has struggled so long and so hard against it. To imagine a future where ordinary people can live without fear of hunger, homelessness, violence and the denial of a creative life, needs more than a cycle of perpetual short term power struggles to keep megalomaniacs in power, such as in the case of the US and UK.

Since the Spanish Revolution and before – the idea of people in control of there own futures is really what strikes terror into the minds of corporate power – not as they would have us believe – Protecting our own people from the threat of violence from others. Violence is a tool that they live happily with, that they use freely and with impunity. The use of propaganda and threat of violence is the only things that make corporations seem to be efficient and to screen the fact that their main objective is not free-trade, but wealth and control, through death, misery and waste.

We do not live in a bubble that is aloof from the misery of others, no mater what rhetoric we hide behind, whatever possessions we covet to dull the noise of our conscience. Our struggle for peace is continuous as is the tyranny of those who seek to destroy it. But we need to believe it can happen, things can change. We will not find what we are looking for in the pages or the networks of the propaganda systems created to dull our senses – fill us with fear and imply – it is useless to try something else.

Rather than celebrating a black man in the “Whitehouse” Shouldn’t we be inspired by the struggle of black Americans, ordinary people who have since the days of slavery challenged, and sacrificed so much and still to this day fight to give their kids even an ordinary life in a system that is stacked against them. Is this not inspiring? Is the challenge from South America by indigenous people against the most powerful state in the world to crush their “democratic” elections not inspiring.

Shouldn’t we be celebrating real democratic achievements, like Juan Evo Morales who has been the President of Bolivia since 2006 – and is the country’s first fully indigenous head of state in the 470 years since the Spanish Conquest. And Hugo Chávez who is the current President of Venezuela – and the leader of the Bolivarian Revolution – who promotes a political doctrine of participatory democracy, socialism and Latin American and Caribbean cooperation. Is this not what we should be celebrating?

In El Salvador, Mauricio Funes, of the former rebel FMLN party, has won the country’s presidential election, ending two decades of conservative rule. Funes won 51 percent of the vote to 49 percent for Rodrigo Avila of the ruling right-wing ARENA party. The FMLN was a coalition of rebel guerrillas who resisted the US-backed military government. More than 70,000 people died over an eighteen-year period, the overwhelming majority killed by military and paramilitary forces. Does this not inspire the idea that change is possible even in the most dire of circumstances?

Sounds like anarchy
This is anarchy – out of control – we will hear screaming from the networks of the “democratic” righteous. This of course is the real fear that strikes at the heart of the neoliberal bully – the fear of participation.

During McCarthyism and through the history of witch hunts carried out in the United States, over these years, communism and communists were brutally suppressed – but anarchists were killed – Sacco and Vanzetti et al. Anarchy, has always been much more dangerous to power structures. Not the right-wing kind of anarchy of fashion, chaos and nonsense – but the traditional anarchy of organisation, self-help, solidarity, mutual-aid, compassion and a vision of free people. This does not fit in any way shape or form to capitalist or neoliberal short term power struggles – What it does fit, is the basic needs of ordinary people, that they actually matter, that they can participate, that they can conduct there own affairs, without destroying all others.

The problem with anarchy is that it has some real answers to a lot of our problems. This is what makes anarchy so dangerous to the powerful – and therefore its need to be vilified. To understand anarchy, not in its pejorative meaning (disorder) but in the freedom to chose how to live without fear and in cooperation must have some resonance for people in the situation we (the west) are living under at the present time?

Maybe to paraphrase Michael Moore, people need to look it up, check it out and understand what anarchy really means, And they might say “Hey this sounds quite good – Maybe we should try it”.

Culture Capitalism

“1990 has been a year of fun, piano-hallentertainment and enjoyment for the people of Glasgow and that’s what we wanted it to be.” (Pat Lally, former leader, Glasgow District Council)
“1990 was a year when an intellectually bankrupt and brutally undemocratic administration projected its mediocre image on to the city and ordered us to adore it.” (Michael Donelly, one- time assistant museum curator. Peoples Palace, Glasgow)

Culture is something through which we make sense of the world. The co-modification of culture as a business tool denies its greatest attribute to most, as a therapy and distraction from more harmful pursuits. Culture is a common good and should not be underestimated as a stabiliser of physical and mental well-being of a society. Deny people of their cultural life and you deny them a vehicle for their aspirations and their place in the world. Neoliberalism commodifies the therapeutic into a money value and destroys that which does not convert.

Cultural Colonisation

“In the light of the hard facts of life as it is lived by people at the bottom of the heap in Glasgow, it is difficult to see the ‘culture’ tag as being anything other than a sham accolade to help grease the wheels of capitalist enterprise and smooth the path for the politicians. It is little wonder working-class Glasgow remains unimpressed. There is widespread acceptance that it has nothing whatever to do with the working- or the workless-class poor of Glasgow but everything to do with big business and money: to pull in investment for inner-city developments which, in the obsessive drive to make the centre of the city attractive to tourists, can only work to the further disadvantage of the people in the poverty ghettoes on the outskirts.

The so-called Merchant City might be reborn but only for those and such as those: the well-heeled who serve and perpetuate the system and profit by the miseries and inequalities inherent in the system: the kind of people who now find themselves installed in central areas where the have-nots “who have not yet benefited from the Thatcher revolution” were long ago uprooted. The rest is just camouflage. Like the million pound spend annually maintaining security at the Burrell whilst housing-scheme squalor gets a pittance. Like the Regional Council laying out £62,000 to stone-clean the Talbot Centre’s exterior whilst the residents within still kip on the floor. That is your Culture City in a nutshell.” Farquhar McLay – Intro to “Workers City 1988”