Return to The History of Neoliberalism Home Page

Return to Wiki Home Page

The Role of  the Neoliberal State

Table of Contents

The Role of  Neoliberalism

After the two world wars and the great depression we saw the adoption of Keynesian measures which included a framework of collaboration between capital and labour.  This economic theory founded by John Maynard Keynes advocated government monetary and fiscal programs intended to stimulate business activity and increased employment (Inwood, 2006).  For almost thirty years Canadians experienced Keynesian measures that promoted a social democratic state.  This focused on full employment for all, economic growth and the welfare of its citizens.  This can be seen through the investment of social institutions and such as health care and education.  The overall focus was to improve human capital (Grabb, 2007).

Stagflation

In the early 1970’s an ensuing economic crisis occurred with both Canada and the United States experienced high inflation

high unemployment, known as stagflation.  Keynesian policies were identified as a threat to economic prosperity given the socialist ideologies (Inwood, 2006). 

The shift to Neoliberalism

Keynesian economics was deemed inadequate and the shift to neoliberalism began.  Essentially a revolution began that included attacks on trade unions, social welfare policies, tax cuts to the wealthy, government budget cuts and deregulation.

All aspects of social behaviour were rethought along economic lines (Davies & Banssel, 2007).

According to Harvey, neoliberalism means, “the finacialization of everything” (Harvey, 2005).

Neoliberalism is “a theory of political economic practices that proposes that human well-being can best be advanced by liberating individual entrepreneurial freedoms and skills within an institutional framework characterized by strong private rights, free markets, and free trade.  The role of the state is to create and preserve an institutional framework appropriate to such practices.  Furthermore, if markets do not exist (in areas such as land, water, education, health care, social security or environmental pollution) then they must be created, by state action if necessary.” (Harvey, 2005).

The role of the neoliberal state is an ideology to facilitate conditions for profitable capital accumulation.  The underlying belief is that people will be competitive, entrepreneurial and enterprising when given the opportunity.  Olssen et al. (2004) indicates that the state will see to it that each one of us makes a continuous ‘enterprise of ourselves’ (Olssen, 2004).

Picture: Stage Production, "Billy Elliot", the Musical

The picture below is from the musical, "Billy Elliot" set in 1985 when Margaret Thatcher was Prime Minister of England. This provides a good example of neoliberalism.  While the musical's storyline features a boy's desire to dance despite gender expectations, the underlying story is about the long lasting miners strike in Northern England.  Thatcher was committed to reducing the power of the trade unions, whose leadership she accused of undermining parliamentary democracy and economic performance through strike action (Wilenius, 2004 and Black, 2009). 

References 

Black, D. (21, February 2009). "Still unbowed, ex-miners to mark 25 years since the start of the strike". The Journal: p.19.

Brosilow, M. (2008).  In Total Solidarity with Billy Elliot, Electronic image. Retrieved, February 13, 2012.

Grabb, E. (2007). Theories of Social Inequality (5^th Ed.)  Nelson, USA. p.81

Harvey, D. (2005). The Brief History of Neoliberalism. Oxford University Press, New York, USA. p.2,33,

Inwood, G. (2006). Public Administration, Political Science 246E. Pearson Custom Publishing. University of Western Ontario. p.18

Olssen, M. (2004).  Neoliberalism, globalisation, democracy: challenges for education. Globalisation, Societies and Education.  Vol. 2, Nol. 2, p.137.

Ruccio, D. F. (September 18, 2011).  Neoliberal hegemony - an unfinished project.  Electronic Image.  Occasional Links & Commentary.  Retrieved from http://anticap.wordpress.com

Wilenius, P. (March 5, 2004).  "Enemies within: Thatcher and the unions" BBC News. Retrieved 16 February 2012.

Return to The History of Neoliberalism Home Page

Return to Wiki Home Page