Neoliberalism is the linguistic omnivore of our times, a neologism that threatens to swallow

up all the other words around it. Twenty years ago, the term “neoliberalism” barely registered
in English-language debates. Now it is virtually inescapable, applied to everything from
architecture, film, and feminism to the politics of both Donald Trump and Hillary Clinton.
Search the ProQuest database for uses of “neoliberalism” between 1989 and 1999, and you
turn up fewer than 2,000 hits. From the crash of 2008–9 to the present, that figure already
exceeds 33,000.

On the left, the term “neoliberalism” is used to describe the resurgence of laissez-faire ideas
in what is still called, in most quarters, “conservative” economic thought; to wage battle
against the anti-tax, anti-government, and anti-labor union agenda that has swept from the
Reagan and Thatcher projects into the Tea Party revolt and the Freedom Caucus; to describe
the global market economy whose imperatives now dominate the world; to castigate the
policies of Bill and Hillary Clinton’s centrist Democratic Party; and to name the very culture
and sensibilities that saturate our minds and actions.

Vital material issues are at stake in all these debates. But the politics of words are in play as
well. Naming matters. It focuses agendas and attention. It identifies causation and strategies
of action. It collects (or rebuffs) allies. Is the overnight ubiquity of the term “neoliberalism”
the sign of a new acuteness about the way the world operates? Or is it a caution that a word,
accelerating through too many meanings, employed in too many debates, gluing too many
phenomena together, and cannibalizing too many other words around it, may make it harder
to see both the forces at loose in our times and where viable resistance can be found?

Origins of “neoliberalism”

“Neoliberalism” came into its current usage on the American left through a much messier past
than is usually acknowledged. Its whirlwind growth threatens to obscure a set of already
existing terms whose analytical and political bite is sharper than the cloud of meanings
“neoliberalism” embraces. At a time when social realism in language is needed as never
before, “neoliberalism” poses severe disadvantages were progressives to try to use it in the
political sphere. Neoliberalism’s advantage is its verbal and conceptual bigness. But before it
swallows the field of words around it, it is worth asking if what we gain is worth the potential
liabilities.
“Neoliberalism” has no single origin or genealogy. It began its verbal life with a series of
false starts. In the nineteenth century, the powerful term around which politics turned was
“liberalism.” Throughout Europe and Latin America, liberal political parties stood for the
maximization of economic and personal liberty: free trade, laissez-faire economies, weak
states, and extended freedom of thought and conscience. In the mid-nineteenth century
liberalism was a fighting term, a banner under which to battle for the extension of liberty into
more and more domains of the older mercantilist and monarchical social order. It needed no
modifier.

The first persons to add the term “new” to “liberal” were rebels within the British Liberal
Party who tried to sever commitment to liberty from the liberal project of laissez faire.
Starting in the hard times of the 1880s, they began to argue that maximum freedom from the
powers of the state did not maximize actual freedom. Against the self-interested actions of
rapacious landlords, exploitative employers, and monopoly-seeking interests, liberty needed
to be secured by the countervailing hand of government. The intellectual architecture of the
mid-twentieth-century welfare states in Britain and the United States was to be largely the
work of these new, socially conscious liberals. John Maynard Keynes and William Beveridge
were “New Liberals” of this sort. So was Franklin D. Roosevelt. Only in the 1940s did this
sense of the term “new liberalism” disappear—fading from political currency in Britain and
becoming subsumed into the “New Deal liberalism” label in the United States.

Variations on the term “neoliberalism” made a second, briefer start in continental Europe in
the late 1940s. There a small group of economists and political philosophers with Friedrich
von Hayek at its center undertook to map a path between socialism and classical laissez-faire
economic liberalism that would retain the preeminence of liberty but prove less vulnerable to
the strains and instabilities that had torn through the 1920s. “Néolibéralisme” was among the
umbrella terms proposed. But the label did not stick long. Hayek disliked the term. The most
influential German participants soon abandoned “neoliberal” for “ordo-liberalism” and
eventually for “social-market economy,” the mixed economy project that, through the
Christian Democratic Party, came to dominate policy making in postwar Germany. Milton
Friedman, the youngest and brashest American in this circle in the 1940s, described his
thinking as “neoliberal” in an essay in 1951. But there was nothing enduringly “neo” about
Friedman’s economic politics. A one-man factory of many of the unabashedly libertarian
proposals that the Freedom Caucus now yearns to enact, Friedman soon cashed in the
“neoliberal” label for himself in favor of “radical” liberal or just plain “liberal” of the classic
nineteenth-century sort.

A third and more wrenching meaning for the term “neoliberal” spilled out of a much later
event: the shock-therapy cure for runaway inflation that the military dictatorship, with counsel
from its University of Chicago economics department advisers, imposed on Chile after
forcibly deposing the nation’s socialist government in the 1970s. Most of those who oversaw
the savagely abrupt dismantling of the Allende government’s economic policies and their
replacement by austerity budgets, privatization of state enterprises and the state pension
system, abolition of price controls, abandonment of most foreign trade restrictions, and
demobilization of the labor unions did not call themselves “neoliberals.” Some Chilean
economists had picked up the term from their German reading. But the overwhelming
majority of Chilean users of the term “neoliberalismo” were critics of the military regime,
outraged at its reactionary project of imposing a new version of laissez-faire liberalism on a
captive nation. “Neoliberalism,” Chilean-style, meant to its critics nineteenth-century
liberalism shorn of political liberty. The term hung on in Latin American debates and, from
there, worked its way back into European debates over political economy.

Finally, a fourth invention of the term “neoliberal,” independent of the first three, came with
Charles Peters’s “A Neoliberal’s Manifesto” in 1983. As Peters used the word,
“neoliberalism” was not a call to bring nineteenth-century economic liberalism back to life
but, rather, to moderate the ambitions of New Deal social liberalism particularly with regard
to labor union privileges and welfare entitlements. It had a powerful impact on the policies of
Bill Clinton and his administration. But the term that stuck in political speech was political
“triangulation,” not “neoliberalism.”

In each of these ways, the term “neoliberal” circled through various uses and occasions with
no secure attachment to any of them. Run a straight genealogical line back to the term’s
origin, and you find the trail strewn with inconsistencies and interruptions. “Neoliberalism”
was a term advanced by different groups for different purposes and at several times left
orphaned. And then, suddenly, in the mid-1990s, it took off. On the academic left, it is now
both the linguistic fad and hegemon of our times.
Prying “neoliberalism” apart

For some of those startled by this sudden turn in political language, the success of
“neoliberalism” is a measure of its substantive hollowness. After careful study, two political
scientists labeled it a “conceptual trash-heap” in 2009: a word into which almost any
phenomenon can be tossed and any number of meanings piled up for composting. Others have
called it a vacant, empty epithet.

But the problem with neoliberalism is neither that it has no meaning nor that it has an infinite
number of them. It is that the term has been applied to four distinctly different phenomena.
“Neoliberalism” stands, first, for the late capitalist economy of our times; second, for a strand
of ideas; third, for a globally circulating bundle of policy measures; and fourth, for the
hegemonic force of the culture that surrounds and entraps us. These four neoliberalisms are
intricately related, of course. But the very act of bundling them together, tucking their
differences, loose ends, and a clear sense of their actually existing relations under the fabric of
a single word, may, perversely, obscure what we need to see most clearly. What would each
of these phenomena look like without the screen of common identity that the word
“neoliberalism” imparts to them?

Finance capitalism: Neoliberalism as economy

Neoliberalism (1)—neoliberalism as economy—names a stage in the history of capitalism. It

stands for the economic regime that global finance capital has unleashed upon the world.
Neoliberalism (1) inscribes on politics and culture the needs of a global capitalism that
sustains itself on the free flow of capital, goods, disembedded labor, and market-friendly state
policies. It does not rely on the state in the same way that the “embedded” corporate
capitalism of the mid-twentieth century did, but it is not a creature of the minimal state either.
It depends, rather, on complex structures of institutional supports, business-friendly
regulations, and free-range investment opportunities arrayed in different ways across the
globe.

And it is fragile. It needs periodic state-managed rescue operations to save it from its
recurrent crises of liquidity and overinvestment. It also requires the continuous support of the
state to maintain its always endangered profit margins—or so the theorist David Harvey
argued in the book that did more than any other to put “neoliberalism” on the map of
American readers, A Brief History of Neoliberalism (2005). Born in the structural dislocations
of the global economy in the 1970s, the neoliberal restructuring project was triggered by the
era’s “crisis of capital accumulation,” Harvey argued. “It has been part of the genius of
neoliberal theory to provide a benevolent mask full of wonderful-sounding words like
freedom, liberty, choice, and rights.” But the grim reality is that it is in fact a project for “the
restoration of naked class power.” Neoliberalism (1) requires political and cultural consent,
but its driving engine is the need for capitalist accumulation.

Market fundamentalism: Neoliberalism as an intellectual project

Neoliberalism (2) refers not to an economic structure but to a strand of ideas. It puts at
neoliberalism’s center not the needs of capitalism’s class in power but an intellectual project:
the restructuring of late-twentieth-century economic thought around the paradigm of the
efficient market. The most recent histories of “neoliberal” economic thought focus
particularly closely on the Hayek circle and the Mont Pèlerin Society that Hayek had
succeeded in organizing by 1947. Liberty was that circle’s overriding concern, as it had been
for nineteenth-century laissez-faire liberals before it. But as historian Angus Burgin has
shown in The Great Persuasion: Reinventing Free Markets since the Depression (2012), the
most striking characteristic of the Mont Pèlerin group was not its ideological rigidity but its
multiple, inconsistent tendencies. For Hayek, rollback of wartime and socialist state planning
was the key objective of the moment, not rollback of the welfare state in total. The Germans
envisioned the ordo-liberal state as integral to creating the conditions for freedom, especially
in resisting capitalism’s tendencies toward monopolization.

Despite the attention now bestowed on Hayek, the real engine of the economic theory of
neoliberalism (2) was the much later work of the microeconomists who came to dominate the
profession after the stagflation crisis of the 1970s. In the public eye, the contest between
Keynesian and monetarist theories of the business cycle was that era’s most visible theory
quarrel. But the more lasting development was the working of price theory deeper and deeper
into analyses of human behavior. Theories of human capital, consumer choice and preference
satisfaction, individual utility maximization, the mutual benefits of free trade and comparative
advantage, and, above all, the axioms of market efficiency, began their long march into the
paradigmatic heart of the economics profession.
Some of those who made a mark on economic theory, particularly those clustered around the
“public choice” paradigm, were aggressively hostile to state action. The “rent seeking”
behavior of those who looked to the state for noncompetitive profits, the self-interest at the
root of every bit of political action, the improbability of securing lasting monopoly advantage
absent state support, the disutility of most forms of regulation, and the “moral hazard” of state
protection from risks were all powerfully broached in these and other circles. On their own,
however, these reformulations of nineteenth-century liberalism’s anti-statist impulses would
not have turned the tide. Most economists still believe that economic regulation has its proper
place, that public goods and market failures do exist, that redistributing incomes in the face of
poverty or high degrees of inequality is a legitimate public function, and that markets are not
the universal solution to all human problems.

What the microeconomic revolution did was not to provide a uniform set of answers but to
construct a powerful conceptual tool kit for the resolution of virtually every maximization
problem. In this form, independent of the early Mont Pèlerin group, elaboration of the way in
which human activities of almost any sort might be understood in terms of price and market
functions now rolls out of economics seminars, not as a self-labeled “neoliberal” project but
as part of the core, commonsense axioms of the trade.

Disaster capitalism: Neoliberalism as policy

Neoliberalism (3) names yet a different phenomenon, politically powerful but less
intellectually coherent than neoliberalism (2). It points to the bundle of business-friendly
policy measures that has circulated more and more widely through domestic and global
politics since the 1970s. Some of these policy measures originated with the economic
theorists. Many were the work of freelance policy entrepreneurs. Increasingly, they now issue
from policy think tanks and advocacy groups funded by factions of what David Harvey calls
the class-in-power. Whatever the source, these measures carry their theoretical and
ideological baggage more lightly than their practical utility. Like the austerity program
imposed on inflation-wracked Chile, they announce themselves as mandated by events
themselves. The mantra of neoliberalism (3), as Margaret Thatcher famously put it, is TINA:
“There is no alternative.”

Typically, moments of crisis open up opportunity for these traveling policy bundles to muscle
in. The austerity reforms imposed by the IMF, World Bank, and other international lenders in
the 1980s when repayment crises overwhelmed debtor nations were a particularly dramatic
case in point. Under the rules of the “Washington consensus,” getting one’s economy in order
through deep cuts in public spending, elimination of state-owned economic enterprises, and
open access for trade and capital became the inescapable price of debt restructuring.
Economic crises of a different sort opened up the political possibilities for Margaret
Thatcher’s austerity program and Ronald Reagan’s tax cuts. Shock economic therapy, as
Naomi Klein has shown, traveled in virtually the same vehicles as the shock-and-awe military
invasion of Iraq. Economic disasters like the near bankruptcy of New York City in 1975 and
the catastrophic actual bankruptcy of Detroit in 2013 broke open the door for dramatic
rollbacks in public services, budgets, and social welfare programs. Hurricane Katrina did the
same for New Orleans after 2005, hollowing out its public school system with extraordinary
speed as private competitors raced in to take its place. Obamacare was shaped by a political
impasse rather than outright disaster. But its experiment with state-created markets in health
insurance was the product of a similar dynamic: a log-jam of interest group pressures,
political urgency, and policy uncertainty into which a policy scheme, taken off the shelf of
pre-made, market-friendly solutions, seemed the only practical way forward.

In none of these instances has the hand of the state been invisible. “Disaster capitalism,” as
Klein and others have called these traveling policy projects, enlists the state in a public rescue
project to exact concessions from some key economic interests and carve out new markets for
other entrepreneurs. The apple-cart of already existing “rent seekers” turns over but the
scramble for state-administered favor and privilege only advances. Neoliberalism (3) may
sometimes wrap itself in a utopian language of choice and preference but it rarely acts as the
free, unsteered market that neoliberalism (2) prescribes.

Commodifying the self: Neoliberalism as cultural regime

Neoliberalism (4), the latest entry into this parade, is the most enveloping of them all. It
names a cultural regime that stamps price and profit onto the very souls of those who live
under it. In the terms Wendy Brown takes from Foucault in her witheringly critical Undoing
the Demos (2015), neoliberalism is not a stage of the economy, a strand of ideas, or a set of
policies but, rather, the “governing rationality” of our times. It is a governmentality that needs
no tangible governors but rules, instead, by its very ubiquity, its power to spread “the model of
the market to all domains and activities.” It “configures human beings exhaustively as market
actors, always, only, and everywhere as homo oeconomicus.” Politics, deliberation, and public
action dissolve under the relentless pressure for leveraging one’s self into a position of greater
human capital and competitive advantage. The state remodels itself as a firm, the university as
a factory, and the self as an object with a price tag. Neoliberalism (1) and (3) might be
challenged politically; neoliberalism (2) might be argued out in economics seminars.
Neoliberalism (4) outlines the saddest and most totalizing scenario of all, in which the
horizons of all other meanings and purposes shrink and submit to those of market capitalism.

Neoliberalism’s identity problem

Although it is easy to note certain general ideas that run through all these uses of the term
“neoliberalism”—suspicion of the command-and-control powers of the state, respect for the
power of incentives in shaping human behavior, and confidence in markets—the differences
between these four neoliberalisms are large and important. They differ in the objects they
name, the causal relations they outline, and the vulnerabilities they reveal. Most importantly
they differ in the political strategies they encourage for contesting the forces advancing on us.

Many of those who have written most acutely about neoliberalism recognize the disorder in
the phenomenon they are bent on describing. The capitalist world “stumbled towards
neoliberalization” through a series of “gyrations and chaotic experiments,” David Harvey
writes. Neoliberalism contrived to “flail-and-fail forward” from crisis to crisis, political
economist Jamie Peck declares, in a “churning and contradictory process of flawed
experimentation.” Neoliberalism is “inconstant” and “plastic,” perpetually available to
“reconfiguration,” Wendy Brown observes. It is “inconstant, morphing, differentiated,
unsystematic, contradictory, and impure”; “unruly”; and “disunified and nonidentical with
itself.” These qualifiers complicate, as they should, the “it all goes back to Hayek” tale one
can still hear in some versions of neoliberalism’s story. But how much of neoliberalism’s
identity problem stems from neoliberalism’s shifting phases and points of reconfiguration?
And how much is its identity problem the result of overstretching a word?

Each of these phenomena has an already existing name: “finance capitalism” for
neoliberalism (1), “market fundamentalism” for neoliberalism (2), the circulating policy
programs of “disaster capitalism” for neoliberalism (3), and a pervasive culture of
“commodified selves” and commodified social imaginations for neoliberalism (4). These
names may not have been fully adequate. But they pointed toward tangible institutions, real
world alternatives, and realizable politics. The power and vulnerabilities of modern global
finance capitalism, the mechanisms through which growing insecurity at the bottom and
extraordinary accumulation at the top have proceeded, even across significantly different
public policy regimes, cries out for more probing scrutiny and much more effective
counteraction. The way in which the modern, mathematically-armored paradigms of utility
maximization and of market efficiency settled into the economics profession as the universal
tool kit for analyzing human behavior is an independent issue that begs for criticism and
alternatives. The ways in which business-friendly proposals ride in on the back of crisis-
fueled policy borrowing demands much more investigation, institutional analysis, and public
resistance. The path to a society that values common goods and the common welfare, that
reimagines politics as an arena of deliberation rather than an advertising-fueled field of
consumer choice, needs all the political work and imagination progressives can muster. None
of these are easy tasks, but within each of these pre-existing terms, the linkages between
analysis and action are explicit and direct. Does crowding all these phenomena aboard a
single verbal omnibus clarify our political task? Or does it make it harder to identify points of
resistance, strategies of action, and the creation of alternative possibilities?

At its extreme, bundling the ills that beset us into too large a sack can exacerbate the
seduction of “despair” which, Wendy Brown writes, looms in front of us. She worries about
the sense of impotence that the “overwhelmingly large, fast, complex, contingently
imbricated, and seemingly unharnessable powers organizing the world today” encourages. For
those who imagined that the crash of 2008–9 might be the neoliberal economy’s long-overdue
death knell only to see the preexisting structures of economy, ideas, and politics come back
stronger than ever, a sense of impotence is hard to dismiss. Brown herself is one of the
leading public intellectual activists of our day. There is grit in her Undoing the Demos. But a
language of pessimism—“exhaustion,” “collapse,” a pervasive shrinkage of the horizons of
possibility and purposes—runs through it. Perhaps this is what a society so thoroughly
organized under the sign of the market produces. Or perhaps it is that the distended categories
make a workable politics all the harder to perceive.

At the current juncture in our politics when a language of social realism is so urgently needed,
of what use is the term “neoliberal”? In the United States, “neoliberalism” is still largely a
word of the academic and intellectual left. So-called neoliberals almost never use it to
describe their projects or themselves. Within the confines of progressive academic journals
and seminars, “neoliberalism” has quickly come to function as a kind of virtual currency.
Portable enough to be used to advantage in virtually every intellectual discussion on the left,
its injection into the conversation carries few costs and gives back clear status returns.

But expansive words rarely stay within their initial bounds. Already “neoliberalism” has
spilled into parts of the public, political arena. To some of those who have tried to understand
Donald Trump’s rise from campaign buffoon to president, the disaster of 2016 was the
revenge that voters took at the tepid “neoliberalism” that Hillary Clinton stood for. To others,
Trump won the electoral votes he needed as “neoliberalism’s” champion: a quintessential man
of deals and his own loudly-shilled value. Behind his billowing promises of economic
nationalism, faster capitalist accumulation at the top may well have been Trump’s endgame
from the beginning.

But in the 2016 electoral burlesque, the politics of language played its independent hand as
well. At a time when intellectuals are viewed with more than usual skepticism by the majority
of the public and when expertise-based claims of truth are under relentless attack, words
matter. For many voters, even those who ultimately voted against him, Donald Trump’s most
transparent appeal was that he spoke in plain language (vulgar, racist, sexist, and demagogic,
too, of course) that they heard as straightforward, vernacular speech. If he lied and
exaggerated, his words bore the air of unvarnished talk. Other politicians tiptoed around; he
dished out the real thing. This is a verbal realism that progressives can’t risk ceding to their
adversaries.

Political words that escape connections with ordinary speech may soar for a while. If
progressives go into the 2018 election with the pitch that they are fighting against our era’s
onrushing tide of “neoliberalism” they may hope to expand the scope of public debate. But
reinforcing the sense that elites don’t talk to anyone other than themselves any more, they are
never going to win outside of a handful of university departments.