Tuesday, July 19, 2011

What is Neoliberalism? Is there Neoliberalism in Ward 6?

I have spent the last two weeks co-teaching a course in Budapest at the Central European University. One of our main topics was neoliberalism. For most people outside the United States, neoliberalism is a well-known concept. Sociologists around the world use the term neoliberalism to understand many global trends. I use the concept of neoliberalism as one helpful tool for understanding what is happening in Ward 6 and elsewhere around the world.

To those unfamiliar with the term, I generally say that neoliberalism can be understood as the ideas and policies of Margaret Thatcher and Ronald Reagan that support free markets and are anti-state. However, neoliberalism is a confusing term, because different groups have used the term in a variety of ways. In general, people see that capitalism has changed since the 1970s, and they call this new kind of capitalism "neoliberal." Broadly, neoliberalism contains the following changes:
  • it rolls back the welfare state. On the one hand, it ends social services through austerity programs, which abandon people to a "precarious" existence. On the other hand, it expands the state by enhancing surveillance and coercion/violence to maintain order. In contrast to the usual perception that Ronald Reagan sought to dismantle the state, he in fact expanded the state in numerous ways, thus reorganizing the state. As many scholars have argued, both Republicans and Democrats have realized neoliberal policies, such as when Bill Clinton sought "to end welfare as we know it."
  • it expands the realm of the market into state activities. Public-private partnerships bring together the state, corporations, and non-profit organizations to realize tasks of the state, such as military activity conducted by private contractors and education provided by the Harlem Children's Zone (funded by corporate donors and focused on testing, an education fundamentally different from that of middle- and upper-income children). Most importantly, the logic of the market changes these services, so that they focus on profits, efficiency, and the short-term, rather than, for example, equal access to these activities, cooperation, and long-term sustainability.
  • it eradicates public or social property through privatization. In the US, most water is owned and managed by city governments, while elsewhere the water supply has been privatized and is run by international corporations.
  • it supports the interests of owners and managers (especially in multinational corporations and international banks), rather than the interests of employees, the unemployed who would like to work, and those precariously employed (the precariat, see the video).
  • it creates a new kind of individual, the neoliberal "subject." These neoliberal changes create a highly competitive, fragmentary, unstable life, to which people are adjusting (successfully or not). In this great article, sociologist Ulrich Beck shows how the new capitalism simultaneously liberates people from past constraints, puts them at considerable risk, and then blames them individually for failing in a situation they could not control. For example, our students often find themselves with a wide range of possible options and thus ask themselves "what do I really want to do? what kind of person am I really?," at the same time most options are illusory and thus they are individually blamed for their failures on the job market. For a similar discussion of the neoliberal subject, see also sociologist Richard Sennett's The Culture of the New Capitalism.
  • it creates the neoliberal, entrepreneurial city. In the new context, cities like Washington, D.C. have taken on many of the tasks once carried out by the national state, but these cities do not have the resources to realize these tasks (due to austerity and low tax rates) and do not have the power to stand up to the demands of multinational corporations. Cities have thus become entrepreneurial, competing with other cities for international investments, high-bond ratings, and high-income residents (including the "creative class" discussed by Richard Florida). The entrepreneurial city must focus on competition and neighborhood branding to lure new residents and international investors. These trends create "dual" cities, with areas of great wealth and other areas of great poverty, through gentrification and dispersal of the poor from certain places (The Yards in SW and Hine Jr. High, both in Ward 6) to make way for new development projects funded by international investors, which in turn fund the entrepreneurial city government. As a result, city residents are not equal, as democracy requires, but rather residents are measured by the revenue they generate.
Is there neoliberalism in DC?


  1. A friend wrote:
    "Pretty concise. I would add that in U.S. domestic politics, "neoliberal" has a narrower meaning, specifically referenced this week in Crooked Timber, Kevin Drum, and Yglesias, as a (largely) Democratic response to the perceived failures of interest-group liberalism of the New Deal."
    I agree that neoliberalism is often seen either as a response to perceived failures of Keynesianism/New Deal or as a decades-long political rejection of Keynesianism/New Deal.

  2. Thanks for this short but to-the-point explanation of neoliberalism and how it could describe our city. Very interesting!

  3. The Yards is in SE, not SW. The yards is being built on industrial land where nobody lived.

    I think you may be thinking of the "new" Southwest, where blocks of poor neighborhoods were razed to make way for urban renewal projects of federal office buildings and private housing.

    In fact, the urban renewal in that case was a top-down process driven by Congress and aimed at "helping" poor people out of the squalor of Southwest. In fact, with all the taking of private property for public purposes (with some redistributed to private purposes, too), it may in fact represent the opposite of neoliberalism.

  4. Thanks, Eric, for pointing out the SE location of The Yards. One can see neoliberalism in The Yards because 1) 700 households in Capper-Carrollsburg public housing just a couple blocks away were moved out under Hope VI to make way for the mixed-income housing and 2) neoliberalism has a lot to do with deindustrialization, which meant the reduction in employment in Ward 6 (probably a long time ago) for the working classes and allows for the current transformation of industrial properties from production into high-end housing and park space (sociologist Sharon Zukin talks about how this happened in the NYC loft scene).

    I'll have to look into the numbers of privately owned dwellings (rental apartments? rental houses? owner occupied houses? owner occupied condos?) destroyed in the most recent urban renewal because I just know about the 1950s urban renewal. New forms of urban renewal do incorporate state-owned buildings (such as public libraries in many cases, but also the larger project of Dept of Transportation in SE), as well as state-regulated mixed income housing, into large-scale development projects with international investors. The conversion of low-rent privately-owned dwellings into higher-rent privately-owned dwellings is part of neoliberalism too.

    In the end, the neoliberalism idea seems to capture a feeling of a lack of hope for the future among the "precariat." For example, Hope VI seems to offer improved housing, but the reality has been that the poor have been pushed out and on the whole not allowed to return.

  5. An important reason to introduce neoliberalism into political discussions in the US is that it highlights the enormous ideological, political, and economic overlap between our two political parties. There are significant differences between the Ds and the Rs, but there is an enormous consensus about a neoliberal future. Even if, in the end, you choose neoliberalism-D or neoliberalism-R, by seeing these parties as two flavors of neoliberalism rather than as ideological opposites, you can at least consider some real opposites to neoliberalism, like syndicalism, market socialism, state socialism, radical democratic socialism, participatory budgeting, and many alternatives that haven't even been imagined yet.

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