May 10, 2014


How the right sold austerity as the only economic solution : More than 30 years of neoliberalism and six years of austerity have floored us, yet the left is incapable of mounting a serious challenge to this economic orthodoxy. Why? (Richard Seymour,  28 March 2014, The Guardian)

The austerity projects we face today are different in one important respect: they come after almost 40 years of neoliberal offensive. This is something which large sections of the left have totally misunderstood; a significant reason for its disarray. For most of the past three decades, neoliberalism has been chiefly analysed as a kind of free market fundamentalism, which is but a glimpsing scratch of the surface.

If neoliberalism was chiefly about free market fundamentalism, then it would be possible to understand the salience of the state as a post-credit crunch economic factor as a repudiation of that orthodoxy. Indeed, many on the left did prematurely pronounce neoliberalism deceased.

However, the dominant strains of neoliberalism have always favoured an interventionist state. It is not the volume of state activity that is the concern of neoliberals, but its character. Neoliberalism is unlike classical liberalism in that it does not assume a human propensity to truck, barter and trade as the basis for political organisation; neoliberals learned through the bitter experience of the 20th century that human behaviour could be as collective as it could be competitive. Thus, a strong state was required not merely to protect property, but to discipline its subjects and educate them in the new neoliberal dispensations.

This is evident in the expansion of penal and coercive institutions, the periodic bailouts of dominant sectors of industry and finance, and the fusion between capital and the state particular to neoliberalism, in which state functions are outsourced or semi-privatised, while being publicly funded. The British government's bailout of finance is an extension of this latter pattern.

So what has 40 years of neoliberal statecraft achieved? The political possibilities have been narrowed through serial defeats of the left, the consequent incorporation of social democratic parties into the neoliberal consensus, and the transformation of state apparatus in a less democratic direction. No governing social democratic party offers a serious alternative to the austerity remedy. The diminution of practical solidarity following on from the state-led defeats inflicted on organised labour is far-reaching. Nine out of 10 private sector workplaces have never seen a union rep, let alone a picket line; the number of days lost to strike action in recent years have been, barring a relatively small spike in 2011, at historic lows. The idea of "rank and file" organisation, let alone wildcat strike action, is something seen only on the peripheries of the labour movement. Trade unions have been effectively disciplined. This is an important reason why the labour response to austerity has been so feeble.

The traditional ruling class is not merely good at exploiting opportunities; it thinks long-term in a way the left must learn to do

Ideologically, there has been a long-term generational shift against the welfare state, and in favour of competitive behaviour. Indeed, competition has increasingly been built into the public sector ("internal markets"), and disciplinary techniques built into social security (in the form of "workfare", for example.) While older generations experienced the welfare state as part of a collective unity, younger generations have experienced it as part of a zero-sum competition for resources. This is the ground on which support for some of the most punitive aspects of austerity, such as welfare cuts, has been constructed; this is the result of a conscious political strategy. The traditional ruling class is not merely good at exploiting opportunities; it thinks long-term in a way the left must learn to do.

Today's austerity projects thus build on the successes of the past, and may continue to do so in the face of the left's perplexity until we begin anew.

It's that fusion bit that the Left should be focussed on, encouraging higher levels of public funding for the state function of building a welfare net.  Yes, they'd need to accept that they'd lost the economics argument and that net was going to rely on capitalist means. But, on the other hand, the fact that provision of the net is universally considered a core state function means that they won the argument about ends.  
Posted by at May 10, 2014 8:28 AM

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