The economic crisis has placed neo-liberalism under pressure. But the left has much to learn from the movement that pushed the rise of the free-market right.
The economic crisis has placed neo-liberalism – and its influence over global economic policy-making – under pressure. Yet the earlier successes of the neo-liberal movement demand careful study by those who want an economic new deal to emerge from the current crisis.
The latest issue of Renewal takes up this task by examining the right’s post-war journey to political victory. Leading experts investigate what the left can learn from the dedicated intellectuals, activists and business-people who nurtured the gospel of the free-market through its wilderness years. As a taster, here is a brief summary of the themes which emerge.
1) the advance of the right required money as well as idealism. There were crucial material foundations to the elaboration of free-market ideology, in particular sustained, long-term financial support from corporate foundations for intellectuals and think tanks engaged in the development and popularisation of free-market alternatives.
2) the revival of free-market ideas was an international project right from the start. A complex transnational network of intellectuals, politicians, business-people and activists was generated from the core neo-liberal organisation, the Mont Pèlerin Society, an elite international discussion group convened by Friedrich Hayek from 1947 onwards to rethink market liberal ideas. The ideological strength of the free-market right derived from its internationalism and, in particular, from harnessing the energies of the American right to a global political project.
3) the free-market right had a strategic analysis of how to go about promoting political change. Hayek thought the boundaries of political feasibility were determined by a conventional wisdom that was itself the product of ‘second-hand dealers in ideas’: journalists, teachers, publicists, public intellectuals, novelists, political advisors, etc. These individuals – who had no particular claim to expertise themselves – drew upon what they took to be the most fashionable expert opinions and broadcast them to a wider audience. The key to changing policy, Hayek argued, was therefore to change the minds of this opinion-forming stratum of society. This was why the think tank was such an important weapon in the neo-liberal armoury. It was a crucial instrument for changing the climate of opinion by persuading journalists, commentators and politicians that what they had previously regarded as out of date and intellectually unfashionable was, on the contrary, at the cutting edge of political thinking. The free-market right was therefore extremely serious about identifying sympathetic experts (especially economists) and systematically marketing their ideas to elite opinion.
4) policy change does not simply reflect ideological change but is rather driven by sporadic crises that delegitimise dominant policies and force policy-makers to cast around for fresh ideas. This is how the economic crises of the 1930s and 1970s are often understood in political folk-memory. But it took a long time, and a tough political struggle, before policy actually changed. The arrival of neo-liberalism in British economic policy-making required not only an external economic shock, but also a full-scale battle of ideas over how to run the economy.
This issue of Renewal therefore forces us to confront some hard questions. Does the left currently possess the long-term strategic thinking and economic resources that facilitated the rise of the free-market right? Has the left developed (or refurbished) a core of intellectually authoritative economic ideas that it can transmit to opinion formers and policy-makers? Can the left forge the international alliances that are needed to build global collective action and solidarities?
Our guest writer is Ben Jackson, Lecturer in Modern History at Oxford University and editor of the ‘Renewal’ issue on the rise of the free market right. Click here for more details.