'Neoliberal capitalism' has contributed to the rise of fascism, says Nobel laureate (Steiglitz)
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"It is not surprising that people who live in the poorest countries emphasise economic rights, the right to medical care, housing, education, and freedom from hunger.
"They are concerned about the loss of freedom not just from an oppressive government but also from economic, social, and political systems that have left large portions of the population destitute," he writes.
He reminds us that economic rights and political rights are, ultimately, inseparable.
"When you understand economic freedom as freedom to act, it immediately reframes many of the central issues surrounding economic policy and freedom," he says.
The lies we were told?
To that end, a big chunk of his book is dedicated to arguing why we've been fed a lie by "neo-liberalism."
He says the neoliberal political project has made millions of people in the United States and elsewhere less free, as it's destroyed the US middle class (and severely threatened it in other countries) while enriching the pockets of the ultra-wealthy and undermining democratic institutions.
"The system that evolved in the last quarter of the twentieth century on both sides of the Atlantic came to be called neoliberalism," he writes.
"'Liberal' refers to being 'free', in this context, free of government intervention including regulations. The 'neo' meant to suggest that there was something new in it.
"What really was new was the trick of claiming neoliberalism stripped away rules when much of what it was doing was imposing new rules that favoured banks and the wealthy.
"For instance, the so-called deregulation of the banks got government temporarily out of the way, which allowed bankers to reap rewards for themselves. But then, with the 2008 financial crisis, government took centre stage as it funded the largest bailout in history, courtesy of taxpayers. Bankers profited at the expense of the rest of the society. In dollar terms, the cost to the rest of us exceeded the banks' gains.
"Neoliberalism in practice was what can be described as 'ersatz capitalism', in which losses are socialised and gains privatised," he says [his italics].
The title of his book is an explicit reference to The Road to Serfdom, which was published by the famous Austrian economist Friedrich Hayek in 1944.
Professor Hayek was one of the leading figures of the post-war neoliberal political movement.
He wrote the Road to Serfdom to warn people of the threat posed to freedom, as he saw it, by governments in the 1930s and 1940s that were increasingly willing to intervene in the market system to plan, or direct, some economic activity for the masses.
He spent much of his life trying to rid the world of the influence of the British economist John Maynard Keynes, whose policy prescriptions inspired governments in countries such as Australia and the UK to pursue "full employment" policies after the war (policies which, coincidentally, supported the so-called Golden Age of Capitalism from 1945 to the early 1970s).
Professor Stiglitz argues that the conception of "freedom" pushed by Professor Hayek and other neoliberals, including Milton Friedman, led us down another wrong path.
"They talked of 'free markets', as if imposing rules and regulations results in 'unfree markets'," he writes.
"They relabeled private enterprises — companies owned by private individuals — as 'free enterprises', as if giving them that appellation would bestow a reverence and suggest that they should not be touched and their freedom should not be curtailed even if they exploit people and the planet.
"[And] the Right claims that governments have unnecessarily restricted freedom through taxation, which constrains the budgets of the rich and thereby … reduces their freedom to act.
"Even in this they are only partially correct because the societal benefits of the expenditures financed by these taxes, the investments in infrastructure and technology, for instance, may expand their opportunity sets (their freedom) in more meaningful ways," he writes.
We're in a war to 'protect and preserve freedom'
Professor Stiglitz was born in 1943. He's 81 years old.
He knew some of the people he writes about in the book and had a ringside seat to the "market turn" that occurred in the 1970s.
He's seen the impact that that market-turn had on the US middle class during the past 40 years.
One can easily imagine that the supporters of the vision of "freedom" that's been promulgated by neoliberalism will find plenty of problems with his book, in both its historical analysis and its policy prescriptions.
But Professor Stiglitz takes no backward step.
"Unfettered, neoliberal capitalism is antithetical to sustainable democracy," he concludes.
"Hayek's famous book The Road to Serfdom claimed that a too-big state was paving the way to our loss of freedom.
"It is evident today that free and unfettered markets advocated by Hayek and Friedman and so many on the Right have set us on the road to fascism, to a twenty-first-century version of authoritarianism made all the worse by advances in science and technology, an Orwellian authoritarianism where surveillance is the order of the day and truth has been sacrificed to power."
(more)
https://www.abc.net.au/news/2024-08-11/joseph-stiglitz-the-road-to-freedom-neoliberalism-fascism/104210670
