Neoliberalism 1: What Is It? Where Did It Come From? A Force For Good Or For Evil?

The first article in what will be a lengthy series examining the creation, formulation, expansion and wide acceptance of the Neoliberal doctrine of political philosophy. The series will go on to analyse how it has informed political and economic activity since its take up by the Reagan and Thatcher administrations in the USA and UK respectively.

by Mike Goodman

The term neoliberalism is being bandied around on social media and people are labelled with the handle neoliberal as though the words were synonymous with rock and roll teenagers’ slang in the early 1960s. Does anybody (apart from me) remember “77 Sunset Strip” and the “hip” language of its somewhat larger than life hero?

Neoliberalism is actually a very serious, right wing, hard line, political philosophy with substantial financial backing from exceedingly wealthy sources. It was named by its earliest protagonists, who included famous economists of their time Frank H Knight, Ludwig von Mises, Friedrich von Hayek and, relatively young and unknown at the time, Milton Friedman. They gave it a capital “N”, calling themselves Neoliberals. It bases its economic foundations loosely upon the neoclassical, Austrian and Chicago schools of economic thought often called “monetarism”.

Why, when such a movement was initiated with such pride and openness, do the current proponents of this doctrine pooh-pooh the name and prefer to call themselves virtually anything else? Free marketeers, liberals, moderates (ever a right wing standby), anything but Neoliberals?

Perhaps they do so with good reason. The term is now one of abuse from the left. The ideology is anathema to working people, to equality of opportunity or of education, it despises social support mechanisms such as health and welfare services. The British Conservatives’ Neoliberal wing is now in firm control of the party. Advocates of the doctrine have had periods of control of both the Labour and Liberal Democratic parties as well as the Cons since the 1970s. From the election win of Margaret Thatcher in 1979 Neoliberal politicians have been in control in Britain for an uninterrupted run of 39 years.

So what went wrong? When did it start to go wrong? Why did it go wrong and when did the British public start to wake up to the fact that all was not right? Just as importantly, it will soon become obvious this movement has had eye-watering amounts of financial support. It simply could not have made the advances it did without it. So where did all the money come from?

We shall be examining all of these questions, hopefully answering most if not all along the way, over the coming weeks. There is a lot of information out there. It is a matter of sifting through to get the salient points into some form of coherent order to be able to fully understand the history and the method. That is currently a work in progress, with progress indeed being made.

It will be very easy to be misled along the way. For instance, we know that some of the richest families and biggest commercial organisations in the world have donated. But we also know that famous families and organisations found charitable ventures in the form of grant-making trusts. Such trusts have aims and objectives. These may be, for instance, to encourage new thinking in this field or that field, favouring no particular direction but being as even-handed as possible in funding several, often concurrently. One or more family members or senior officers may, or may not, be directly involved. So where we discover a particular “family” or “corporation” has supported any of the Neoliberal organisations, we must also discern whether that is a result of direct involvement or a more neutral donation from the trust.

We’ll be starting at the foundational level. The free market and globalisation advocates have been around for a very long time. The first events of note which signalled these people may be coming together were a colloquium which happened in 1938, organised by Walter Lippman and attended by all of the above, and the inaugural meeting of the Mont Pèlerin Society, held in a hotel in the Swiss resort village of Mont Pèlerin in 1947. The name for that society in southern Europe may be Sociedad del Monte Peregrino but that may need to be confirmed or refuted in a future article. It was at this second event the name Neoliberal was officially born.

The Mont Pèlerin meeting spawned no less that 140 “think tanks” worldwide, including in the USA and Great Britain, which could be more accurately described as propagandist “churches” to preach the gospel of laissez-faire and globalisation, fully indoctrinating its new disciples with the blessed political philosophy.

The series will move on through the first full take-up at national level by Reagan in the USA and Thatcher in Great Britain after some dabbling by the Heath, Wilson and Callaghan governments here in GB. From there the doctrine gained momentum and wreaked devastation, particularly in Europe and the “tiger” economies of the Far East in the 1990s and beyond, to the present day.

Author: Mike Goodman

Mike's main intersts are in economic policy, politics and current affairs. He has a degree in economics. He is retired now but still makes himself available occasionally for interesting speaking or training engagements. Leisure interests include rugby (the union code), cricket, music (especially modern to contemporary jazz), food, wine, good company or a good book.

3 thoughts on “Neoliberalism 1: What Is It? Where Did It Come From? A Force For Good Or For Evil?”

  1. Looking forward to the next in the series. Very much intrested to see the increasing power of corporations and investment banks charted out.

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