BY CJ POLYCHRONIOU and ANASTASIA GIAMALI
C.J. Polychroniou and Anastasia Giamali: Neoliberal ideology claims that the government is a problem, society does not exist and individuals are responsible for their own fate. Yet, big business and the rich rely, as ever, on state intervention to maintain their hold over the economy and to enjoy a bigger slice of the economic pie. Is neoliberalism a myth, merely an ideological construct?
Noam Chomsky: The term neoliberal is a bit misleading. The doctrines are neither new, nor liberal. As you say, big business and the rich rely extensively on what economist Dean Baker calls “the conservative nanny state” that they nourish. That is dramatically true of financial institutions. A recent IMF study attributes the profits of the big banks almost entirely to the implicit government insurance policy (“too big to fail”), not just the widely publicized bailouts, but access to cheap credit, favorable ratings because of the state guarantee and much else. The same is true of the productive economy. The IT revolution, now its driving force, relied very heavily on state-based R&D, procurement and other devices. That pattern goes back to early English industrialization.
However, neither “neoliberalism,” nor its earlier versions as “liberalism,” have been myths, certainly not for their victims. Economic historian Paul Bairoch is only one of many who have shown that “the Third World’s compulsory economic liberalism in the 19th century is a major element in explaining the delay in its industrialization,” in fact, its “de-industrialization,” a story that continues to the present under various guises.
In brief, the doctrines are, to a substantial extent, a “myth” for the rich and powerful, who craft many ways to protect themselves from market forces, but not for the poor and weak, who are subjected to their ravages.
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