Idea-ology: Creating the Illusion (Part 1)

“Underlying most arguments against the free market is a lack of belief in freedom itself.”
Milton Friedman, Capitalism & Freedom (1962).


Via the manipulation of meritocratic values mixed with a misreading of Darwin’s theory of evolution (commonly referred to as Social Darwinism), a change in our concept of freedom, and pushing the narrative that humans are homo economicus (this is the idea that humans always act rationally and in their own economic self-interests) Neoliberalism, the name given to the ideology of late capitalism, tries to justify itself as natural (and very successfully) when in fact these things have become a contradiction into themselves.

This common sense has changed how people feel about low-paid workers, our views on how the government should support its citizens and how much it should be involved in the market, furthermore it has become an excuse to give tax cuts to the rich. The demonisation of the working class in the form of reality television and talk of benefit scroungers was a further push for a hyper-meritocratic view of society. This has allowed politicians of all stripes to cut back the state and what it did for its citizens whilst making people feel bad for not making it.

This pandemic has shown us that society cannot function without the working class, but that it continues without stock brokers and bureaucrats.

Growing Pains

Neoliberalism has a long history, but it was in the time of Margaret Thatcher and Ronald Reagan, the early 1980s, that it established itself in the UK and the USA. Since then it has been pursued by successive governments in most countries, including some ‘left’ wing parties, and international institutions the world over. Think: the EU, World Bank, IMF and so on.

After the Second World War, when the USA, France and the UK were scrambling against the USSR to establish a who would be top dog in the world, 44 nations got together at the Bretton Woods summit to stabilise capitalism in the face of communism. Following the summit there was a tremendous wave of investment into countries via the Marshall Plan, a series of large loans from the US to some European countries and investment
in the US itself. Many saw this as the US empire laying foundations in the West ready to take over as the new imperialist power after the UK. Capitalism was re-founded in many countries; they did this by implementing a progressive tax system on the rich, investing in trade and commodities and expanding the welfare state (many claim this was
due to the threat of revolt).

Many countries started universal health care systems, schools and made huge improvements in social housing, transport and other amenities.
This would lead to the foundations of the EU being built on the idea of free trade and cooperation between countries. This was the era of liberal social democracy, or New Deal thinking, and it was the dominant ideology until around the late 70s or mid 80s (many hail the 1968 Paris riots as a point where its hegemonic dominance started to kilter)

During this period after the war, it was essentially a pact between liberal politicians and most of the left. The right also supported some incentives. The basis of this ideology was that the market provided and met a country’s needs, but also that the nation state
would be able to intervene. It was normal for the state to own key infrastructure (such as the health system, trains, buses, airlines, car brands, electricity companies and the postal service) and run services for the sake of the country, not for profit. These ideas
gave us the skeletons of the infrastructure we still see today. [12] The counter culture (yes the hippies and that lot) were generally against ‘the man’ as they saw the state (both liberal democracy and communist countries) as oppressive. Freedom and peace were on the menu but no-one was serving it. However, this ideology was not all-encompassing across the world, the USSR stood in opposition to liberal ideas with its version of communism. The Cold War was essentially a fight for hegemonic dominance but with nukes. Things changed after the USSR fell in the early 1990s, capitalism seemed to be the economic system of choice.


Not liking high taxes, the state running key industries, regulated markets, and holding the belief that man is at his best when his money and society were not regulated by the state, Friedrich Hayek formed the Mont Pelerin Society. Later key figure of neo-liberal thought Milton Friedman would also join the group. Thus, the ideology of neoliberalism
was (re)born. That is not to say they created the ideas around neoliberalism, they already existed, they just updated them and promoted them. Ideas come from material realities. The political and economic consensus around the New Deal ideology
was coming apart due to an oil crisis and inherit contradictions within the system. With the socialist project stumbling in the USSR, the Vietnam war and various levels of discontent and a taste for the
future.

The wealthy and politicians were looking for an alternative way to keep hold of their wealth and power and the system that gave them all that in the first place. At first neoliberalism looked absurd, it was only later that it got its shot. It was the answer
they had been looking for.

The liberal part of the word come from 19th century Classical Liberalism; the belief man is better when he can do as he pleases without government interference with an emphasis on the economic part. Hayek set up the society to see how they could
go about reviving it. It should not be confused with Social Liberalism, the belief that people should be able to choose how they want to live and that individual freedom should be respected by the government as much as possible, but, also that the state
has a responsibility to address issues such as poverty and climate change. Social liberals feel they can do this without changing capitalism, but just by managing it better or making it more human friendly.

Just to note, I use the word neoliberalism instead of late-capitalism, or even liberalism, as it is more specific regarding the problems of capitalism we face today, and this specific way of thinking that has been reborn since the crumbing of the post-war
consensus. The ideology has flourished more since the fall of the Berlin wall and the USSR, this is also one of the problems with the dominant ideology of today. It is the new (neo) liberalist though of the 21st century.

There has always been and ideology, both before and after capitalism. Hence the phrase: “The dominant ideology is the ideology of the dominant class”

If you enjoyed this entry, parts 2 and 3 will be out soon, or if you want to read the whole book you can download it from here for free!

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