Came through a while back...
-- Forwarded message --
Date: Mon, 9 Dec 1996 15:22:04 -0800
From: D Shniad <[EMAIL PROTECTED]>
Reply-To: Forum on Labor in the Global Economy <[EMAIL PROTECTED]>
To: Multiple recipients of list LABOR-L <[EMAIL PROTECTED]>
Subject: Primer on Neo-Liberalism
29 August 1996
WHAT IS "NEO-LIBERALISM"?
A brief definition for activists
by Elizabeth Martinez and Arnoldo Garcia
"Neo-liberalism" is a set of economic policies that
have become widespread
during the last 25 years or so. Although the word is
rarely heard in the United States, you can clearly see
the effects of neo-liberalism here as the rich grow
richer and the poor grow poorer.
"Liberalism" can refer to political, economic, or even
religious ideas. In the U.S. political liberalism has
been a strategy to prevent social conflict. It is
presented to poor and working people as progressive
compared to conservative or Right wing. Economic
liberalism is different. Conservative politicians who
say they hate "liberals" -- meaning the political type
-- have no real problem with economic liberalism,
including neoliberalism.
"Neo" means we are talking about a new kind of
liberalism. So what was the old kind? The liberal
school of economics became famous in Europe when Adam
Smith, an English economist, published a book in 1776
called THE WEALTH OF NATIONS. He and others advocated
the abolition of government intervention in economic
matters. No restrictions on manufacturing, no barriers
to commerce, no tariffs, he said; free trade was the
best way for a nation's economy to develop. Such ideas
were "liberal" in the sense of no controls. This
application of individualism encouraged "free"
enterprise," "free" competition -- which came to mean,
free for the capitalists to make huge profits as they
wished. Economic liberalism prevailed in the United
States through the 1800s and early 1900s. Then the
Great Depression of the 1930s led an economist named
John Maynard Keynes to a theory that challenged
liberalism as the best policy for capitalists. He said,
in essence, that full employment is necessary for
capitalism to grow and it can be achieved only if
governments and central banks intervene to increase
employment. These ideas had much influence on President
Roosevelt's New Deal -- which did improve life for many
people.
The belief that government should advance the common
good became widely accepted. But the capitalist crisis
over the last 25 years, with its shrinking profit
rates, inspired the corporate elite to revive economic
liberalism. That's what makes it "neo" or new. Now,
with the rapid globalization of the capitalist economy,
we are seeing neo-liberalism on a global scale.
A memorable definition of this process came from
Subcomandante Marcos at the Zapatista-sponsored
Encuentro Intercontinental por la Humanidad y contra el
Neo-liberalismo (Inter-continental Encounter for
Humanity and Against Neo-liberalism) of August 1996 in
Chiapas when he said: "what the Right offers is to turn
the world into one big mall where they can buy Indians
here, women there " and he might have added,
children, immigrants, workers or even a whole country
like Mexico."
The main points of neo-liberalism include:
1) THE RULE OF THE MARKET.
Liberating "free" enterprise or private enterprise from
any bonds imposed by the government (the state) no
matter how much social damage this causes. Greater
openness to international trade and investment, as in
NAFTA. Reduce wages by de-unionizing workers and
eliminating workers' rights that had been won over many
years of struggle. No more price controls. All in all,
total freedom of movement for capital, goods and
services. To convince us this is good for us, they say
"an unregulated market is the best way to increase
economic growth, which will ultimately benefit
everyone." It's like Reagan's "supply-side" and
"trickle-down" economics -- but somehow the wealth
didn't trickle down very much.
2) CUTTING PUBLIC EXPENDITURE FOR SOCIAL SERVICES like
education and health care. REDUCING THE SAFETY-NET FOR
THE POOR, and even maintenance of roads, bridges, water
supply -- again in the name of reducing government's
role. Of course, they don't oppose government subsidies
and tax benefits for business.
3) DEREGULATION. Reduce government regulation of
everything that could diminish profits, including
protecting the environment and safety on the job.
4) PRIVATIZATION. Sell state-owned enterprises, goods
and services to private investors. This includes
banks, key industries, railroads, toll highways,
electricity, schools, hospitals and even fresh water.
Although usually done in the name of greater
efficiency, which is often needed, privatization has
mainly had the effect of concentrating wealth even more
in a few hands and making the public pay even more for
its needs.
5) ELIMINATING THE CONCEPT OF "THE PUBLIC GOOD" or
"COMMUNITY" and replacing it with "individual
responsibility." Pressuring
