Defining NeoliberalismSupply Side Economics Full Description:Supply-Side Economics posits that production (supply) is the key to economic prosperity. Proponents argue that by reducing the “burden” of taxes on the wealthy and removing regulatory barriers for corporations, investment will increase, creating jobs and expanding the economy. Key Policies: Tax Cuts: Specifically for high-income earners and corporations, under the premise that this releases capital for investment. Deregulation: Removing environmental, labor, and safety protections to lower the cost of doing business. Critical Perspective:Historical analysis suggests that supply-side policies rarely lead to the promised broad-based prosperity. Instead, they often result in massive budget deficits (starving the state of revenue) and a dramatic concentration of wealth at the top. Critics argue the “trickle-down” effect is a myth used to justify the upward redistribution of wealth. as a Political-Economic Ideology

Neoliberalism is a political-economic ideology that centers on the conviction that free markets, private enterprise, and competition are the primary drivers of human well-being and prosperity . In broad terms, neoliberals argue that society functions best when businesses and individuals operate with minimal government interference, within a framework of strong private property rights, free markets, and free trade . The state, according to this view, should focus chiefly on creating and maintaining the conditions for markets – for example, by enforcing contracts, safeguarding property rights, controlling the money supply, and even actively creating markets in areas like education or health care – and then step back, refraining from intervention in the economy beyond these basic functions . Under neoliberalism, public services and goods are often privatized, regulations on businesses are deregulated, and taxes (especially on corporations and the wealthy) are cut, with public spending correspondingly reduced . In short, neoliberalism advances a vision of society as a giant market, with competition and individual entrepreneurial freedom as the organizing principles for all areas of life .

Despite its name, neoliberalism is not simply a revival of 19th-century classical liberalism’s laissez-faire doctrine. In fact, scholars note that neoliberal ideology is “highly constructivist”, relying on a strong state to actively engineer a market order in all aspects of society . Rather than leaving markets alone entirely, neoliberalism’s proponents believe that governments may need to reshape laws and institutions to create market conditions, then rigorously protect those markets from interference. This has meant, for example, converting public domains like education, health, or pensions into competitive markets (often via privatizationPrivatization Full Description:The transfer of ownership, property, or business from the government to the private sector. It involves selling off public assets—such as water, rail, energy, and housing—turning shared public goods into commodities for profit. Privatization is based on the neoliberal assumption that the private sector is inherently more efficient than the public sector. Governments sell off state-owned enterprises to private investors, often at discounted rates, arguing that the profit motive will drive better service and lower costs. Critical Perspective:Critics view privatization as the “enclosure of the commons.” It frequently leads to higher prices for essential services, as private companies prioritize shareholder returns over public access. It also hollows out the state, stripping it of its capacity to act and leaving citizens at the mercy of private monopolies for their basic needs (like water or electricity).
Read more), and using state power to insulate economic policy from popular democratic pressures . In the words of one analysis, neoliberalism “does not advocate laissez-faire… but instead advocates a strong state to bring about market-like reforms in every aspect of society.” In practice, neoliberal thinkers have been wary of mass democratic demands, fearing they might lead to policies like wealth redistribution or robust welfare states that constrain market freedoms. As historian Quinn Slobodian observes, neoliberals from the mid-20th century onward sought to “protect markets from the vagaries of democratic political systems”, even constructing transnational institutions to guard the global economy against social or nationalist interventions .

To summarize the core tenets of neoliberal ideology in simple terms, we can identify several key beliefs:

Free Markets as Optimal: Neoliberalism holds that market mechanisms (supply and demand, price signals) are the most efficient and fair way to allocate resources. Markets are seen as superior information processors, so extending market logic into as many spheres of life as possible will lead to better outcomes . For neoliberals, “the market” is considered an arbiter of truth and value, and market exchange is elevated to an almost ethical principle guiding human behavior . Minimal State (Economic Role): Government should reduce its role in the economy – meaning deregulating industries, eliminating price controls or trade barriers, and generally “getting out of the way” of private enterprise. Direct state intervention (beyond creating the conditions for markets) is viewed with suspicion, as it is believed to distort prices and breed inefficiency . Neoliberal policy agendas thus typically include fiscal austerity (cutting government spending, especially on social programs), monetarist policies to control inflation, and strict limits on deficit spending, in stark contrast to the more interventionist Keynesian approach of earlier decades. Privatization and Commodification: A hallmark of neoliberal practice is the transfer of public assets or services to private ownership or management. Everything from state-run industries to utilities, schools, and healthcare can be turned into commodities to be bought and sold. Influential neoliberal thinkers argued that if a market doesn’t exist in some area of social life, it must be created . For example, instead of government providing a service directly, the neoliberal approach is to introduce competition by privatizing it or outsourcing it to private firms. As author Naomi Klein succinctly summarizes, the “three policy pillars of neoliberalism” are privatization of the public sphere, deregulationDeregulation Full Description:The systematic removal or simplification of government rules and regulations that constrain business activity. Framed as “cutting red tape” to unleash innovation, it involves stripping away protections for workers, consumers, and the environment. Deregulation is a primary tool of neoliberal policy. It targets everything from financial oversight (allowing banks to take bigger risks) to safety standards and environmental laws. The argument is that regulations increase costs and stifle competition. Critical Perspective:History has shown that deregulation often leads to corporate excess, monopoly power, and systemic instability. The removal of financial guardrails directly contributed to major economic collapses. Furthermore, it represents a transfer of power from the democratic state (which creates regulations) to private corporations (who are freed from accountability).
Read more of the corporate sector, and lowering taxes (especially on the rich and businesses) paid for by cutting public spending . Individualism and Entrepreneurialism: Neoliberal ideology views individual liberty and responsibility as paramount. Society, in this view, is essentially a collection of individuals seeking to advance their own well-being through market exchange. The ideal citizen in a neoliberal society is an entrepreneurial individual – someone who is self-reliant, adapts to market demands, and invests in their own human capital. This goes hand-in-hand with a suspicion of collective solutions: collective bargaining, strong labor unions, or expansive welfare programs are seen as distorting individual incentives and market outcomes. Instead, personal success or failure is often attributed to individual choices, with the market rewarding talent and effort accordingly. Global Free Trade and Investment: Neoliberalism has a global outlook, advocating for the removal of barriers to international trade and capital flows. Neoliberal policy-makers promote free trade agreements, foreign investment, and transnational supply chains as engines of growth. This also involves institutions like the International Monetary Fund (IMF), World Bank, and World Trade Organization (WTO) encouraging (or pressuring) countries to liberalize their economies – a set of prescriptions often termed the “Washington ConsensusWashington Consensus The Washington Consensus refers to a specific array of policy recommendations that became the standard reform package offered to crisis-wracked developing countries. While ostensibly designed to stabilize volatile economies, critics argue it functions as a tool of neocolonialism, enforcing Western economic dominance on the Global South. Key Components: Fiscal Discipline: Strict limits on government borrowing, often resulting in deep cuts to social programs. Trade Liberalization: Opening local markets to foreign competition, often before domestic industries are strong enough to compete. Privatization: Selling off state-owned enterprises to private investors. Critical Perspective:By making aid and loans conditional on these reforms, the consensus effectively strips sovereign nations of their ability to determine their own economic destiny. It prioritizes the repayment of international debts over the welfare of local populations, often leading to increased poverty and the erosion of public infrastructure..” The belief is that open markets worldwide will maximize efficiency and prosperity; however, this has also tied national economies more tightly to global market fluctuations and norms.

In essence, neoliberalism can be understood as both a revival and an update of classical free-market liberalism, tailored to the late-20th-century context. It explicitly arose in the mid-20th century as a reaction against the rise of welfare states, socialism, and Keynesian economic management (more on that below). Crucially, neoliberalism is not just a set of economic policies but a “whole way of thinking” about society – often described as a governing rationality. As political theorist Wendy Brown argues, neoliberalism extends market principles into all realms of life, ultimately “converting the democratic citizen into homo economicus, a self-investing human capital” in competition with others, and eroding the ethos and institutions of democracy in the process . Understanding neoliberalism, then, requires looking at both its intellectual foundations and its real-world outcomes.

Theoretical Foundations: From Hayek and Friedman to the Mont Pelerin SocietyMont Pelerin Society Full Description:An exclusive international organization founded by Friedrich Hayek and others to combat the rise of state planning and social democracy. It served as the primary intellectual incubator for neoliberal thought, playing a long-term strategic role in shifting global economic consensus. The Mont Pelerin Society was the “thought collective” behind the neoliberal counter-revolution. Established when free-market ideas were politically marginalized, it brought together economists, philosophers, and historians to refine and propagate individualist economic theories. Critical Perspective:Critically, this group exemplifies the “long game” of ideology. They understood that to change policy, they first had to change the intellectual climate. By building a network of think tanks and academic departments, they successfully waited for a crisis (stagflation) to present their pre-packaged ideas as the only viable solution, effectively manufacturing a new “common sense” that favored the elite.
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Neoliberalism’s intellectual foundations were laid by a transnational network of economists, philosophers, and policy thinkers in the mid-20th century who sought to revive pro-market ideas in an era dominated by interventionist government policies. In 1947, economist Friedrich Hayek convened a group of like-minded thinkers at Mont Pelerin in Switzerland, forming what became the Mont Pelerin Society . Figures such as Hayek, Milton Friedman, Ludwig von Mises, and later James M. Buchanan (among others) became the leading lights of neoliberal thought . They were reacting against the prevailing economic consensus of the mid-20th century – the Keynesian welfare state model in the West and state socialism in the East – which they believed threatened individual freedom and economic efficiency.

Friedrich Hayek, an Austrian economist, had warned in The Road to Serfdom (1944) that government economic planning and expansive social programs, even if well-intentioned, would set society on a path to tyranny. Hayek and his colleagues believed that only free markets could safeguard personal freedom and prevent authoritarianism. They argued that prices in a free market transmit information more effectively than any government planner could, and that competition is a discovery procedure that drives innovation and prosperity. At a 1938 conference in Paris (the Colloque Walter Lippmann), early neoliberals defined their project as affirming “the priority of the price mechanism, free enterprise, the system of competition, and a strong and impartial state” . Importantly, they saw a role for a “strong state” – not to manage the economy directly, but to establish and enforce the rules of a market economy. For example, Hayek envisioned a legal framework protecting competitive markets from monopolies, securing private property, and preventing governments (or even democratic majorities) from undoing market outcomes.

This constructivist element is what distinguished neoliberalism from 19th-century laissez-faire liberalism. Classical liberals like Adam Smith or John Stuart Mill, and later proponents of laissez-faire, often treated the market as a natural order that largely governs itself if the state simply abstains from interference. Neoliberals, by contrast, understood that in modern complex societies, markets had to be actively constructed and maintained by state action and legal design . Economist Philip Mirowski notes that neoliberals “are constructivists, redefining and building a strong state to institute and maintain the kinds of markets they think will not come about on their own.” In other words, the neoliberal project was not about eliminating the state, but rather about retooling the state to serve the market. This included creating new markets (for instance, in pollution rights or social services), overcoming “market failures” by market means, and insulating economic policy from what they saw as the short-sighted or self-interested demands of voters and special interest groups.

Two of the most influential thinkers in shaping concrete neoliberal policy were Milton Friedman and James M. Buchanan. Friedman, a leading figure of the University of Chicago’s economics department (hence the term “Chicago School”), championed monetarismMonetarism Monetarism is the economic school of thought associated with Milton Friedman, which rose to dominance as a counter to Keynesian economics. It posits that inflation is always a monetary phenomenon and that the government’s role should be limited to managing the currency rather than stimulating demand. Key Mechanisms: Inflation Targeting: Using interest rates to keep inflation low, even if high interest rates cause recession or unemployment. Fiscal Restraint: Opposing government deficit spending to boost the economy during downturns. Critical Perspective:Critics argue that monetarism breaks the post-war social contract. By prioritizing “sound money” and low inflation above all else, monetarist policies often induce deliberately high unemployment to discipline the labor force and suppress wages. It represents a technical solution to political problems, removing economic policy from democratic accountability. (a focus on controlling the money supply to manage inflation) and argued for deregulation and free enterprise in books and popular media (his PBS series Free to Choose popularized these ideas). Buchanan, a pioneer of public choice theory, contended that government officials and voters are guided by self-interest, just like market actors, often leading to inefficient and expansive government; his work provided an intellectual rationale for limiting democratic control over economic policy (for example, via constitutional rules against deficits).

By the 1970s, these neoliberal ideas began to gain significant ground. They offered an alternative ideological framework at a time when the post-World War II economic order was faltering. The postwar decades (the 1940s–1960s) had been characterized by Keynesian economicsKeynesian Economics Full Description:The dominant economic consensus of the post-war era which argued that the government had a duty to intervene in the economy to maintain full employment and manage demand. Neoliberalism defined itself primarily as a reaction against and a dismantling of this system. Keynesian Economics underpinned the “Golden Age” of capitalism and the welfare state. It operated on the belief that unregulated markets were prone to collapse and that the state must act as a counterbalance—spending money during recessions and taxing during booms—to ensure social stability and public welfare. Critical Perspective:From the neoliberal viewpoint, Keynesianism was a slippery slope to totalitarianism. However, critics argue the dismantling of this consensus broke the social contract between capital and labor. By abandoning the commitment to full employment and social safety nets, the state abdicated its responsibility to its citizens, prioritizing the health of the currency over the health of the population.
Read more – high government spending, social welfare programs, and regulated capitalism – a period sometimes called the “embedded liberalism” compromise or the social-democratic consensus. But the stagflationStagflation Full Description:A portmanteau of “stagnation” and “inflation,” describing a period of high unemployment coupled with rising prices. This economic crisis in the industrialized West shattered faith in the post-war order and provided the “window of opportunity” for neoliberalism to ascend. Stagflation was the crisis that Keynesian economics could not explain or fix. Triggered in part by oil shocks, it created a situation where traditional state spending only fueled inflation without creating jobs. This failure paralyzed the political left and allowed the neoliberal right to step in with radical new solutions focused on breaking unions and shrinking the money supply. Critical Perspective:Naomi Klein and other critics view this moment as the first major application of the “Shock Doctrine.” The crisis was used to justify painful structural reforms—such as crushing labor power and slashing social spending—that would have been politically impossible during times of stability. crisis of the 1970s (stagnant growth combined with high inflation and unemployment) discredited Keynesian policies in the eyes of many and created an opening for neoliberal prescriptions. As one analysis notes, “neoliberalism, as noted, arose in part in response to the dominance of Keynesian macro-economic policy” and promised a return to growth by means of market discipline . Monetarist economists like Friedman advised its adoption: for example, U.S. Federal Reserve Chairman Paul Volcker in 1979 unleashed a monetarist shock (drastically raising interest rates) to crush inflation, reflecting neoliberal priorities of price stability over full employment.

It’s important to highlight that neoliberalism’s philosophy of governance extends beyond economics into a broader social vision. Neoliberal theorists were deeply concerned with what they saw as the moral and cultural foundations of a market order. They emphasized individual initiative, entrepreneurship, and personal responsibility as cultural values. Societies, they argued, should reward innovation and effort; welfare policies or strong labor protections, in their view, risked creating dependency or stifling the vigor of the market. The neoliberal state thus sought to cultivate a certain kind of subject: competitive, self-reliant individuals. Even democracy, in neoliberal thought, was often conceived in limited terms – valued insofar as it produced a government that secured economic freedom, but viewed warily when democratic demands threatened to redistribute wealth or regulate business. Hayek famously warned that too much democracy (unfettered majority rule) could become tyrannical, especially if voters used politics to encroach upon the economy. This skepticism toward popular democracy led neoliberals to favor institutional safeguards: independent central banks, judicial review, international trade agreements – all tools to lock in market-friendly policies and shield them from electoral reversal .

In summary, the theoretical foundations of neoliberalism were laid by a circle of thinkers who, after World War II, set out to rehabilitate and modernize classical liberal ideas. They created an ideology that praised the free market not only as efficient, but as the guarantor of freedom itself, and they strategized about how to implement this vision in a world that they felt had gone too far in the direction of state intervention. By the late 20th century, their ideas would move from the seminar room to the corridors of power, reshaping economies and societies across the globe.

Neoliberalism vs. Classical Liberalism and KeynesianismKeynesianism Full Description:Keynesianism emerged as a direct response to the failure of classical economics to explain or fix the depression. It posits that the “invisible hand” of the market is insufficient during a downturn because of a lack of aggregate demand. Therefore, the state must step in as the “spender of last resort,” borrowing money to fund public works and social programs. Critical Perspective:Structurally, this represented a fundamental shift in the role of the state—from a passive observer to an active manager of capitalism. It was essentially a project to save capitalism from its own contradictions, using public funds to prevent the kind of total social collapse that often leads to revolution.

To better understand neoliberalism, it helps to contrast it with two other major economic philosophies: classical liberalism and Keynesianism. Neoliberalism drew inspiration from the former and vehemently opposed the latter, yet it also departed from classical liberalism in important ways.

Classical liberalism (the ideology of thinkers like Adam Smith, David Ricardo, and John Stuart Mill in the 18th and 19th centuries) championed free markets, private property, and limited government. In many respects, neoliberalism revives these classical ideas in a modern context. However, neoliberalism is not simply old laissez-faire in new clothing. One key distinction is that classical liberals generally favored a “night-watchman state” – a government that is minimally involved, mainly protecting property rights and enforcing contracts, otherwise leaving markets alone. Neoliberals, by contrast, openly acknowledge that the state must actively shape conditions for markets. As the Stanford Encyclopedia of Philosophy notes, “Neoliberalism is distinct from [classical] liberalism insofar as it does not advocate laissez-faire economic policy, but instead is highly constructivist and advocates a strong state to bring about market-like reforms in every aspect of society.” In practical terms, this meant neoliberals were comfortable using governmental power to privatize state industries, rewrite laws, and even override democratic preferences to ensure markets could operate freely. Anthropologist Jason Hickel observes that spreading neoliberalism globally “required substantial state intervention to establish a global ‘free market’” – hardly a laissez-faire process. Thus, neoliberalism’s relationship to classical liberalism is somewhat paradoxical: it pays homage to the free market ideals of classical thinkers, yet it is willing to wield the state as an instrument to impose market relations (e.g., via international trade agreements or domestic legal reforms). Some scholars like Quinn Slobodian have gone so far as to argue that neoliberalism is fundamentally about encasing capitalism in a protective shell, insulating it from democratic control – which is a different project than the classical liberal faith in natural liberty .

Another difference lies in social philosophy: early classical liberals often had a moral vision of the independent yeoman or bourgeois citizen balancing self-interest with civic virtue. Neoliberalism’s vision, especially in its late-20th-century form, can appear more strictly economistic – reducing social and political life to market logic. Critics note that neoliberal thought treats the “invisible hand” of the market almost as a divine, infallible force that must not be restrained . Former Greek Finance Minister Yanis Varoufakis quips that unlike Adam Smith or John Stuart Mill, “neoliberals felt no responsibility to demonstrate, theoretically or empirically, under what circumstances the unfettered market” would actually benefit society – they took it on faith that freeing markets was always the right answer, an attitude that “suited Wall Street to a tee” . In that sense, neoliberalism can be more dogmatic than classical liberalism, elevating market success as the primary measure of value (even above older liberal values like individual dignity or democratic participation).

If classical liberalism is one parent of neoliberalism, Keynesianism is its foil. John Maynard Keynes, writing in the 1930s, had revolutionized economics by arguing that unregulated markets can lead to prolonged recessions and social ruin, and that active government intervention (especially fiscal and monetary stimulus) is often necessary to maintain full employment and economic stability. After World War II, Keynesian ideas informed the widespread creation of welfare states, government investment in public goods, and regulatory oversight of finance and industry. By the 1950s–60s, most Western capitalist nations practiced some form of mixed economy – markets coexisted with significant state planning, social insurance programs, progressive taxation, and pro-labor policies. This era, sometimes called the “Golden Age of capitalism”, delivered high growth and improving equality in many countries, but it was precisely the environment that neoliberal thinkers sought to overturn.

Neoliberals saw Keynesianism as a fundamental threat to the free market order. In their view, Keynesian policies led to excessive government, deficits, and inflation, and eroded the disciplines of the market. As one account puts it, “Keynesianism is neoliberalism’s other great foe” – the two schools are diametrically opposed on how to respond to economic downturns . Keynesians advocate counter-cyclical spending (government spending more in a recession to stimulate demand), whereas neoliberals believe markets should be left to adjust, with the only permissible interventions being things like central bank actions to control the money supply (and even then, some neoliberals prefer automatic rules to technocratic discretion). In the late 1970s and 1980s, neoliberal-oriented leaders literally purged Keynesians from positions of influence – for instance, it’s noted that in 1982, the World Bank and IMF were taken over by officials favoring neoliberal doctrines, a “total clean-out” of Keynesian economists . From then on, these global institutions often prescribed neoliberal policies (like austerity and market liberalization) to countries in crisis, marking a sharp break from their earlier more Keynesian approach to development.

In policy terms, the differences between Keynesian and neoliberal paradigms can be summarized as follows. Keynesianism stresses full employment, economic equality, and the use of government budgets to moderate booms and busts. Keynesians tolerate or even encourage a larger public sector and robust social safety nets, believing these support aggregate demand and social stability. Neoliberalism, in contrast, prioritizes low inflation, balanced budgets, and confidence of investors. Neoliberals prefer monetary policy (e.g. raising or lowering interest rates) over fiscal policy to address economic issues, and they vehemently oppose government deficits except perhaps in extreme emergencies. They also tend to distrust welfare programs and labor protections, arguing that such interventions distort labor markets and create dependency. For neoliberals, unemployment is often seen as a necessary cost to discipline the labor market (or even a result of overly generous wages), whereas Keynesians view unemployment as a failure of aggregate demand that policy should fix. By the 1980s, this intellectual battle tilted in favor of neoliberalism as governments in the U.K., U.S., and elsewhere abandoned Keynesian tools in favor of tax cuts, deregulation, and tight monetary control of inflation.

In summary, neoliberalism differentiates itself from classical liberalism by its strategic use of the state to create its ideal market order (rather than a passive night-watchman stance), and it stands in direct opposition to Keynesian economics by rejecting the idea that government should manage demand or redistribute wealth. Where Keynesianism aimed to balance market outcomes with social goals, neoliberalism reasserted market supremacy and significantly narrowed the space for public interest or egalitarian interventions in the economy.

Neoliberalism in Practice: Case Studies from Chile, Britain, the US, and Beyond

By the late 1970s and early 1980s, neoliberal theory leapt off the page and into actual policy, as a number of countries implemented sweeping free-market reforms. While no two cases are identical, these examples illustrate how neoliberal ideology was put into practice – often with dramatic social and economic consequences.

Chile (1970s–1980s): The Laboratory of Neoliberalism. Chile under General Augusto Pinochet is frequently cited as the first true experiment in neoliberal economic engineering. Following a military coup in 1973 that overthrew socialist president Salvador Allende, Pinochet’s dictatorship – advised by a group of U.S.-trained economists known as the “Chicago Boys” – implemented shock therapy-style reforms. The Chilean government privatized state industries, slashed trade barriers and tariffs, opened the country to foreign investment, deregulated finance, and drastically cut social spending. These changes were explicitly guided by neoliberal ideas learned at the University of Chicago under Milton Friedman’s tutelage. Notably, Chile’s neoliberal turn was imposed under authoritarian conditions: unions were crushed and political opposition silenced. As a result, Chile became a showcase (and battleground) for neoliberalism. Supporters argue that the reforms tamed hyperinflation and eventually spurred growth, turning Chile into one of Latin America’s wealthier economies. Critics point out that the early years of reform were marked by deep recession and increased poverty (unemployment and inequality surged in the 1970s ), and that any long-term gains came at extreme social cost. Moreover, the Chilean case indelibly linked neoliberal economics with dictatorial coercion. Even sympathetic observers acknowledge “the uncomfortable fact that [the neoliberal] approach was first implemented by a mass-murdering tyrant” – Pinochet – and that Chicago-trained economists “transmitted these programs to Pinochet directly”, bypassing any democratic process . Chile’s experience, documented in works like Naomi Klein’s The Shock Doctrine, gave rise to the term “shock therapy,” describing how drastic neoliberal reforms were often introduced in the wake of crises or coups, when the public was too disoriented or repressed to resist. The Chilean model (sometimes called “El Ladrillo,” after the nickname of the Chicago Boys’ economic plan) later served as a template for other countries’ reforms – an early instance of the globalization of neoliberalism.

United Kingdom (1980s): Thatcher’s Free-Market Revolution. In 1979, Margaret Thatcher became Prime Minister of a Britain plagued by high inflation, labour strikes, and what she viewed as a general economic malaise caused by state intervention and powerful trade unions. Thatcher, influenced by neoliberal thinkers and British free-market advocates, embarked on a sweeping transformation of the U.K. economy in line with neoliberal doctrine. Her government privatized dozens of state-owned companies (British Telecom, British Gas, British Airways, steel, coal, and more were sold off to private investors) . She also deregulated key industries – for instance, the 1986 “Big Bang” deregulation of financial markets turned London into a global banking hub. Thatcher famously took on the trade union movement, seeing it as an impediment to market flexibility: major strikes (most notably the miners’ strike of 1984–85) were defeated, and a slew of laws curtailed union power (at one point even effectively making many union activities illegal and severely restricting the right to strike) . In fiscal policy, Thatcher’s government cut income taxes sharply for the wealthy – the top marginal tax rate fell from 83% to 40% under her tenure . These tax cuts were offset partly by regressive taxes (like a controversial poll tax) and by reducing the scope of the welfare state. Thatcher’s ideology was encapsulated in her blunt slogan, “There is no alternative” (often abbreviated as TINA): she insisted that a market-driven economy was the only viable system, delegitimizing any return to Keynesian or socialist models. The outcomes of Thatcher’s neoliberal agenda are still debated. The U.K. did see a decline in inflation and a surge in financial sector growth. However, inequality and unemployment rose significantly in the 1980s . Whole communities (especially industrial and mining towns) faced economic devastation as industries were exposed to global competition or outright shut down. A decade after Thatcher left office, one in five people in Britain were living in absolute poverty, including nearly 4 million children – a legacy many attribute to the “rolling back” of social programs during the 1980s . Even so, Thatcher’s revolution shifted the political landscape: she influenced even her opponents (she quipped that her greatest achievement was “Tony Blair’s New Labour,” implying that even the center-left had come to accept neoliberal premises). In sum, the U.K. in the 1980s demonstrated both the implementation of neoliberal orthodoxy and the social conflicts it generated, from mass protests against the poll tax to the polarization of wealth between London’s finance elite and the working-class North.

United States (1980s–1990s): Reaganomics and the Market Gospel. In the United States, neoliberal ideology found a powerful champion in President Ronald Reagan (elected 1980). Reagan’s economic program – nicknamed “Reaganomics” – was a quintessential application of neoliberal ideas in a democratic context. His administration slashed taxes, especially on the rich (the top income tax rate fell from 70% to 28% during the 1980s), under the belief that this would spur entrepreneurship and investment (the supply-side or “trickle-down” theory) . Reagan also pushed extensive deregulation: rules on airlines, trucking, telecommunications, and, importantly, financial institutions were rolled back. He famously declared in 1981 that “government is not the solution to our problem; government is the problem,” capturing the neoliberal ethos of minimizing the state’s role. Social spending for the poor (on programs like food stamps and public housing) was cut, even as military spending increased (showing that “small government” had its exceptions). Reagan also took a hard stance against organized labor – most notably by firing over 11,000 air traffic controllers who struck for better conditions in 1981, a move that signaled a broader assault on union power in the private sector as well. These policies mirrored those in the U.K. and were justified by similar logic. According to the Reagan Foundation’s summary, the Reagan administration aimed to “reduce government regulation, lower taxes, and promote free-market capitalism as a means to stimulate economic growth” . In practice, the U.S. economy of the 1980s did recover from stagflation – inflation dropped and growth resumed – but it also saw the start of a dramatic rise in inequality. From about 1980 onward, the gains of economic growth in America skewed heavily to the top: the wealthiest 1% of Americans saw their incomes and wealth share surge, while middle-class wages stagnated . By one measure, the top 1% doubled their share of national income from around 10% in the late 1970s to over 20% by the early 21st century . This pattern is widely seen as a result of neoliberal policies – deregulation and globalization benefited capital owners and highly skilled workers, while union-busting and austerity weakened the bargaining power and safety nets for ordinary workers. Neoliberalism in the U.S. continued beyond Reagan: the Democratic Clinton administration in the 1990s, though more centrist in rhetoric, embraced key neoliberal tenets (free trade agreements like NAFTA, the deregulation of Wall Street with the repeal of Glass-Steagall, welfare reform that cut benefits to the poor, etc.). By the 2000s, both major parties had largely converged on a pro-market consensus, reflecting how deeply neoliberal thinking had penetrated American policy circles. That consensus remained dominant until it was shaken by events such as the 2008 financial crisis.

Post-Soviet States (1990s): Shock Therapy after Socialism. A third arena where neoliberal ideology had a massive impact was the former communist bloc after the Cold War. When the Soviet Union collapsed in 1991, Russia and other newly independent states faced the challenge of transitioning from state-planned economies to capitalism. Western economists – many from the IMF, World Bank, or academia – urged these countries to adopt rapid market liberalization, in what came to be called “shock therapy.” In Russia, for example, the government under President Boris Yeltsin (with advice from figures like economist Jeffrey Sachs) implemented overnight privatization of state industries, price liberalization (lifting price controls and subsidies, which caused prices to skyrocket), and opening to global trade and investment. The result was a period of extreme economic turbulence: Russia’s GDP plummeted by more than 40% in the 1990s, hyperinflation wiped out savings, and a small group of businessmen – the oligarchs – acquired former state assets for pennies on the dollar, becoming fabulously wealthy while millions fell into poverty. Similar shock therapy approaches were applied in Eastern European countries like Poland (though with varying outcomes; Poland’s reforms, while painful, succeeded in taming inflation and eventually led to growth). The guiding philosophy behind shock therapy was unabashedly neoliberal: the belief was that any delay in liberalization would allow “special interests” to block reform, so a swift, sweeping application of free-market measures was necessary to irreversibly transform these economies. Critics argue that this process ignored the social context – there was no established rule of law or social safety net to cushion the transition – and thus it produced “Wild West” capitalism rife with corruption and inequality. In Russia’s case, the turmoil of the 1990s led to public disillusionment with liberal reforms and set the stage for the rise of an authoritarian leadership under Vladimir Putin, who reasserted state control in some areas. Nonetheless, the post-Soviet shock therapy period stands as a stark example of neoliberal prescriptions being applied at a rapid pace. It also showcased the role of international financial institutions in spreading neoliberalism: loans from the IMF or aid from Western governments often came with conditions requiring privatization, deregulation, and fiscal austerity – a package many came to label the “neoliberal agenda.”

These case studies underscore that neoliberalism was not just an abstract theory; it became a concrete program that reshaped societies. Across different countries, common patterns emerged: deregulation of industries, cutting of taxes (especially on businesses and the wealthy), privatization of public enterprises, weakening of labor unions, shrinking of welfare programs, and integration into the global market. By the 1990s, as geographer David Harvey observes, “there has everywhere been an emphatic turn towards neoliberalism in political-economic practices and thinking since the 1970s” . From New Zealand to Sweden, from Canada to South Africa, various forms of neoliberal “structural adjustmentWashington Consensus The Washington Consensus refers to a specific array of policy recommendations that became the standard reform package offered to crisis-wracked developing countries. While ostensibly designed to stabilize volatile economies, critics argue it functions as a tool of neocolonialism, enforcing Western economic dominance on the Global South. Key Components: Fiscal Discipline: Strict limits on government borrowing, often resulting in deep cuts to social programs. Trade Liberalization: Opening local markets to foreign competition, often before domestic industries are strong enough to compete. Privatization: Selling off state-owned enterprises to private investors. Critical Perspective:By making aid and loans conditional on these reforms, the consensus effectively strips sovereign nations of their ability to determine their own economic destiny. It prioritizes the repayment of international debts over the welfare of local populations, often leading to increased poverty and the erosion of public infrastructure.” became the norm, sometimes voluntarily adopted, other times imposed as conditions for assistance . Even China, a communist-led country, initiated market reforms under Deng Xiaoping that had neoliberal elements (decentralization, special economic zones, encouragement of private enterprise) – although China never fully embraced political liberalism, and the state retained a guiding hand. By the dawn of the 21st century, neoliberalism had achieved a kind of ideological hegemony in global elites – the sense that “there is no alternative” to free-market capitalism became conventional wisdom in many circles .

Social and Economic Outcomes: Criticisms of Neoliberalism

While neoliberalism became the dominant policy framework in much of the world by the early 2000s, it has been subject to intense criticism, especially from scholars, activists, and communities who have borne the brunt of its outcomes. Indeed, neoliberalism’s legacy is highly contested, with critics arguing that it has led to rising inequality, weakened democracy, and the erosion of public goods and social cohesion. Here we outline some of the major criticisms and their intellectual sources:

Inequality and Class Power: Perhaps the most frequent criticism is that neoliberal policies have significantly increased economic inequality, concentrating wealth and power in the hands of a small elite. David Harvey, a Marxist geographer and one of the foremost analysts of neoliberalism, famously argued that “neoliberalization was from the very beginning a project to achieve the restoration of class power” by economic elites . In Harvey’s view, neoliberalism’s vaunted “free markets” often mask a drive to restore or reinforce the dominance of capital over labor – essentially, a kind of class warfare from above. The empirical trends lend support to the inequality critique: Since the late 1970s, income and wealth disparities have surged in most neoliberalized economies. For example, in the United States, the top 1% richest more than doubled their share of national income, while wages for ordinary workers stagnated . In the U.K., the Gini coefficient (a measure of inequality) rose sharply during the 1980s and has remained high. Globally, neoliberal globalization has often meant sweatshop labor in the Global SouthGlobal South Full Description:The Global South is a term that has largely replaced “Third World” to describe the nations of Africa, Latin America, and developing Asia. It is less a geographical designator (as it includes countries in the northern hemisphere) and more a political grouping of nations that share a history of colonialism, economic marginalization, and a peripheral position in the world financial system. Bandung is often cited as the birth of the Global South as a self-aware political consciousness. Critical Perspective:While the term implies solidarity, critics argue it acts as a “flattening” concept. It lumps together economic superpowers like China and India with some of the world’s poorest nations, obscuring the vast power imbalances and divergent interests within this bloc. It risks creating a binary worldview that ignores the internal class exploitations within developing nations by focusing solely on their external exploitation by the North.
Read more and outsized rewards for corporate shareholders and financial investors. Even the International Monetary Fund – once a bastion of neoliberal advice – acknowledged in a 2016 paper that “some neoliberal policies have increased inequality, in turn jeopardizing durable [economic] expansion.” In other words, critics say neoliberalism not only creates inequity but may also undermine long-term growth by depressing the incomes of the majority. Additionally, scholars like Thomas Piketty have shown that, absent intervention, returns on capital tend to outpace overall growth, leading to ever-greater wealth concentration – a dynamic arguably accelerated under neoliberal tax and deregulation regimes. Diminished Democracy: Another major line of critique is that neoliberalism has undermined democratic governance and citizenship. Wendy Brown, in Undoing the Demos, argues that neoliberal reason “wages war on the very idea of a public” and hollows out democratic institutions . By prioritizing market logic in all decisions, neoliberalism reframes citizens as consumers and reduces political choices to economic choices. Policies that once might have been debated on ethical or social grounds (e.g. how to provide healthcare or education) are instead decided by market calculus (e.g. cost-benefit analysis, profitability). Brown notes that under neoliberalism, “educated public life” and meaningful democratic debate have been thinned out, replaced by a shallow politics often driven by money and media spectacle . Moreover, many neoliberal reforms have been implemented in technocratic or executive-led ways that bypass popular input – for instance, independent central banks setting economic policy, trade agreements negotiated in secret, or emergency austerity measures imposed by international creditors. Political scientist Quinn Slobodian’s research on neoliberal intellectuals found that many sought to encase markets in institutions “insulated from democratic politics” – like supranational trade regimes or constitutional budget limits – precisely because they feared that voters, if given full power, would choose redistribution or protectionismProtectionism Full Description:Protectionism involves the erection of trade barriers ostensibly to “protect” domestic industries from foreign competition. As the global economy contracted, nations panicked and raised tariffs to historically high levels in a desperate attempt to save local jobs. Critical Perspective:This created a “beggar-thy-neighbor” cycle of retaliation. When one dominant economy raised tariffs, others followed suit, causing international trade to grind to a halt. Instead of saving industries, it choked off markets for exports, deepening the crisis. It illustrates how the lack of international cooperation and the pursuit of narrow national interests can exacerbate a systemic global failure.. The Eurozone crisis in the 2010s is often cited: bodies like the European Commission and IMF pushed austerity on countries like Greece despite popular opposition, a scenario economist Yanis Varoufakis decried as the “demolition of democracy” by neoliberal creditors. In sum, critics charge that neoliberalism tends to concentrate decision-making in the hands of unelected experts, private executives, and global institutions, thereby diluting the sovereignty of the people. Even culturally, the emphasis on individual success in the market can erode solidaristic values that are vital for a healthy democracy, such as empathy, community, and the notion of shared public interest. Public Goods and Social Welfare: Neoliberalism’s drive toward privatization and budget cuts has, according to critics, led to the degradation of public goods and services. When state enterprises and services (from water utilities to healthcare systems) are privatized or run on market principles, the outcome can be reduced access and greater inequality. For instance, the privatization of water and electricity in some Latin American and African countries under World Bank structural adjustment programsStructural Adjustment Programs Full Description:Structural Adjustment Programs (SAPs) are the enforcement mechanism of neoliberalism in the developing world. When countries face debt crises, international lenders provide bailouts only if the government agrees to restructure its economy according to free-market principles. Consequences: Erosion of Sovereignty: National governments lose control over their own budgets and priorities. Social Impact: Requirements to cut deficits frequently lead to the introduction of user fees for health and education, excluding the poor from essential services. Export Orientation: Economies are forced to focus on extracting resources for export to pay off debts, rather than growing food or goods for domestic consumption. Critical Perspective:Critics describe SAPs as a form of “debt peonage,” where developing nations remain perpetually indebted to Western financial institutions. The programs often result in a net flow of wealth from the poor global South to the rich global North, exacerbating underdevelopment. often led to sharp price hikes, triggering protests over “IMF riots.” In the industrialized world, years of neoliberal policy have seen infrastructure and social supports deteriorate: affordable housing shortages, rising college tuition, and struggling public transit are often linked to the retreat of government provisioning. Wendy Brown highlights how neoliberalism not only cuts public services, but even attacks the very notion of a public realm, leaving society with “crumbling infrastructures of solidarity” . Basic human needs – education, healthcare, transportation, even prisons – have been increasingly subject to profit logics, sometimes with perverse outcomes (for example, a for-profit prison industry lobbying for harsher sentencing to boost its “customer” base). Critics like Naomi Klein have documented how neoliberal “reforms” are frequently packaged and sold during moments of crisis (natural disaster, financial collapse, etc.) – what she terms the “shock doctrine” – resulting in public assets being snapped up by private interests at the expense of the common good . The overall critique is that neoliberalism, by insisting that market value is the only value, has led to underinvestment in non-market goods that are essential for human flourishing but not immediately profitable – such as environmental protection, public health, education, and scientific research. The COVID-19 pandemic starkly revealed some of these weaknesses: decades of neoliberal austerity left many governments with inadequate healthcare capacity and frayed social safety nets, arguably exacerbating the crisis. Financial Crises and Instability: Paradoxically for an ideology that preaches economic efficiency, neoliberalism has been blamed for fostering greater instability and crises. The deregulation of financial markets – a core neoliberal policy in the 1980s and 1990s – unleashed a wave of speculative booms and busts. From the stock market crash of 1987, to the Mexican peso crisis (1994), Asian financial crisis (1997), Russian default (1998), and the U.S. dot-com bust (2000), liberalized capital flows and lightly regulated banking sectors contributed to volatile capital movements. This all culminated in the 2008 global financial crisis, when the collapse of Wall Street’s speculative bubble (rooted in deregulated mortgage lending and complex financial derivatives) nearly brought down the world economy. Critics argue that this pattern is not accidental: neoliberal policies empower the financial sector (“Wall Street”) and encourage risk-taking by removing oversight, which inevitably leads to crashes that then impose huge costs on society. Each crisis was met with government bailouts of banks or investors – a glaring irony where the state intervenes to save the market from its own excesses, while ordinary people suffer unemployment and austerity. Even some insiders began to question the neoliberal model after 2008. Notably, an IMF article titled “Neoliberalism: Oversold?” in 2016 admitted that capital account liberalization (free flow of finance across borders) and fiscal austerity may have done more harm than good in many cases . This was a remarkable concession from an institution long seen as a neoliberal stronghold. It reinforced what critics like economist Joseph Stiglitz had been saying: unfettered markets, especially in finance, are prone to failure and can devastate economies if not managed in the public interest. Impact on Society and Culture: Beyond economics and politics, critics charge that neoliberalism has brought a more competitive, consumerist, and individualistic culture, often at the expense of traditional community values or social cohesion. The emphasis on personal responsibility has in some cases stigmatized the poor (the idea that if everyone’s an entrepreneur, those who fail must be “lazy” or at fault). The gig economy – flexible, but precarious jobs with little security – is sometimes cited as a neoliberal product, maximizing efficiency for firms at the cost of worker stability. Neoliberal globalization has also been linked to cultural homogenization (the spread of Western consumer culture) and has prompted backlashes in the form of nationalism and populism. For example, some analysts interpret the rise of right-wing populist movements in the 2010s (Brexit in the U.K., Trump in the U.S., etc.) as a reaction by those left behind by neoliberal global capitalism – although ironically, those movements have not necessarily broken with neoliberal economics, often doubling down on tax cuts and deregulation in practice.

It should be noted that defenders of neoliberalism do exist, and they counter-argue that many issues blamed on neoliberalism are due to other factors (technological change, globalization generally, or government mismanagement). They credit neoliberal reforms with curing the stagflation of the 1970s, spurring innovation (especially in finance and tech), and forcing bloated governments to become more efficient. However, by the 2010s even some mainstream economists and institutions conceded that neoliberalism had significant downsides. For instance, the World Bank and IMF began to talk more about inclusive growth and even inequality as a threat to stability, which was a shift in tone. In academia and activism, the term “neoliberalism” itself became something of a pejorative – shorthand for unbridled capitalism and its discontents .

Key Thinkers and Critics of Neoliberalism

Throughout the discussion above, several influential thinkers have been mentioned. Here we briefly highlight a few and their contributions, as they often come up in debates about neoliberalism:

Milton Friedman (1912–2006): An American economist and Nobel laureate, Friedman was a leading advocate of neoliberal ideas. He promoted free-market policies in academia and popular media, advising leaders like Reagan and Thatcher. His famous quote “there is no such thing as a free lunch” epitomizes the belief that market outcomes reflect rational trade-offs. He argued for policies like school vouchers (introducing competition in education) and against most government interventions. Friedman’s work on monetarism influenced central banks worldwide to prioritize controlling inflation over reducing unemployment. Friedrich Hayek (1899–1992): An Austrian-British economist, Hayek is often seen as the philosophical father of neoliberalism. His writings, especially The Road to Serfdom, warned that state control of the economy leads to tyranny. Hayek emphasized the dispersed nature of knowledge and the price system’s role in coordinating complex societies. His ideas inspired the creation of institutes and think tanks that spread neoliberal doctrine. Hayek also helped found the Mont Pelerin Society, networking intellectuals committed to liberal principles. David Harvey (1935– ): A Marxist geographer, Harvey became one of neoliberalism’s chief critics with his book A Brief History of Neoliberalism (2005). He provides a detailed analysis of how neoliberalization unfolded globally and posits that it was fundamentally a political project to restore the power of economic elites after the egalitarian gains of mid-20th century. Harvey introduced concepts like “accumulation by dispossession,” suggesting neoliberalism acquires wealth for the few by dispossessing the many (through privatization, commodification, and financial manipulation). His class-based analysis has been highly influential in academic critiques of neoliberalism . Quinn Slobodian (1978– ): A historian, Slobodian’s book Globalists: The End of Empire and the Birth of Neoliberalism (2018) offered a fresh perspective on neoliberal ideology. He studied the “Geneva School” of neoliberals (European thinkers like Ludwig von Mises, Hayek, Wilhelm Röpke, etc.) and argued that they were primarily concerned with designing global institutions to protect capitalism from democratic pressures. According to Slobodian, neoliberals accepted that nation-states might succumb to voter demands for socialism or welfare, so they looked to supranational frameworks (trade agreements, international courts, etc.) to lock in free markets beyond the reach of one country’s politics . This interpretation has re-emphasized that neoliberalism was never about pure laissez-faire, but about a rules-based global order advantageous to capital. Wendy Brown (1955– ): A political theorist, Brown has examined neoliberalism’s effect on democracy and subjectivity. In works like Undoing the Demos (2015) and In the Ruins of Neoliberalism (2019), she argues that neoliberalism has a “stealth” quality – it incrementally transforms thinking so that even our concept of ourselves and our rights becomes economic. She highlights how democratic values (equality, deliberation, the public good) have been subverted by market metrics and individualism. Brown is especially concerned with how neoliberalism has paved the way for authoritarian populism and moral backlash (what she calls a “de-democratizing” and “hyper-governmental” turn) by hollowing out liberal democratic culture . Naomi Klein (1970– ): A Canadian journalist and activist, Klein is known for The Shock Doctrine (2007), which investigates how neoliberal policies have often been imposed during crises or through coercion. She documents cases from Chile to Iraq to New Orleans, arguing that disasters (whether coups, wars, or natural catastrophes) have been used as opportunities to push through privatization, deregulation, and cuts that would face resistance in normal times . Klein’s work popularized the idea that neoliberal globalization goes hand in hand with an anti-democratic strategy – one that exploits or even creates shocks to achieve its aims. She is also a prominent critic of corporate power and has linked neoliberalism to environmental destruction, coining terms like “disaster capitalism.” Yanis Varoufakis (1961– ): A Greek economist and former Finance Minister of Greece, Varoufakis has been an outspoken critic of neoliberal European policies. He experienced firsthand the confrontation between a democratically elected anti-austerity government (Syriza in 2015) and the “Troika” of EU/IMF creditors who enforced neoliberal austerity on Greece. Varoufakis argues that capitalism and democracy are often at odds in the current framework, and he has warned that neoliberalism is mutating into something even more sinister (what he calls “techno-feudalism” or “techlordism”, as big tech monopolies and central banks wield enormous power) . In April 2025, Varoufakis provocatively declared “Neoliberalism is dead. Say hello to techlordism,” suggesting that the neoliberal era of open markets is giving way to a new era dominated by quasi-monopolistic tech companies and oligarchic control . Whether or not one agrees, his perspective underscores the sense that neoliberalism’s dominance may be waning, and new ideological battles are emerging.

These thinkers (and many others, including Joseph Stiglitz, Noam Chomsky, Henry Giroux, Thomas Piketty, Sylvia Federici, etc.) have enriched the discourse by examining neoliberalism from different angles – economic, political, cultural, and gendered. Their works provide a more critical and nuanced understanding than what one might get from politicians’ soundbites or economics textbooks alone.

Conclusion: The Contested Status of Neoliberalism in 2025

As of 2025, neoliberalism remains a hotly debated and evolving topic. After roughly four decades of neoliberal dominance in policy-making, we are now in a moment of reflection and challenge. The global financial crisis of 2008 was a seismic event that shook faith in deregulated markets, leading even some champions of neoliberalism to reconsider certain dogmas. The 2010s saw a resurgence of political movements critical of neoliberal globalization – from the Occupy Wall Street protests against inequality, to the rise of left-wing parties (e.g. Syriza in Greece, Podemos in Spain, Bernie Sanders’ campaigns in the U.S., Jeremy Corbyn’s leadership of the UK Labour Party) explicitly naming neoliberalism as a source of social ills. At the same time, right-wing nationalist movements also capitalized on discontent with the status quo, albeit often scapegoating immigrants or international institutions rather than economic policies per se.

The COVID-19 pandemic (2020–21) further forced a reevaluation. In response to the crisis, many governments broke decisively with neoliberal orthodoxy by deploying massive fiscal stimulus, expanding welfare provisions temporarily, and intervening in economies on a scale not seen in decades. Suddenly, deficit spending was not taboo and the public sector’s importance (in healthcare, vaccine development, etc.) was undeniable. This led some observers to suggest that the pandemic might mark the end of neoliberalism’s reign – a turn toward a neo-Keynesian or social-democratic revival. Indeed, phrases like “Building Back Better” and the embrace of industrial policy or stronger safety nets by some leaders indicate a possible shift. However, others caution that reports of neoliberalism’s death are premature. After the immediate crisis subsided, familiar pressures to cut spending and return to market discipline re-emerged in many countries. Moreover, the pandemic also witnessed a massive transfer of wealth to corporate giants (especially Big Tech and e-commerce firms), arguably intensifying inequalities further. In Varoufakis’s terms, we may be seeing neoliberalism morph into a new configuration (what he dubs “technofeudalism”) rather than simply disappearing .

One clear sign of neoliberalism’s contested status is the battle over its definition and legacy. While critics use “neoliberalism” as a shorthand for the prevailing system of the last decades – often condemning it for everything from climate change to precarious work – some economists and commentators (usually on the center-right) insist the term is overly vague or a mere insult . Yet, as historian Gary Gerstle argues, neoliberalism can be meaningfully defined as “a creed that calls explicitly for unleashing capitalism’s power” and rolling back the institutions that tempered it . Gerstle and others have characterized the period from roughly 1980 to 2008 as the “neoliberal era” – analogous to the New DealThe New Deal Full Description:A comprehensive series of programs, public work projects, financial reforms, and regulations enacted by President Franklin D. Roosevelt. It represented a fundamental shift in the US government’s philosophy, moving from a passive observer to an active manager of the economy and social welfare. The New Deal was a response to the failure of the free market to self-correct. It created the modern welfare state through the “3 Rs”: Relief for the unemployed and poor, Recovery of the economy to normal levels, and Reform of the financial system to prevent a repeat depression. It introduced social security, labor rights, and massive infrastructure projects. Critical Perspective:From a critical historical standpoint, the New Deal was not a socialist revolution, but a project to save capitalism from itself. By providing a safety net and creating jobs, the state successfully defused the revolutionary potential of the starving working class. It acknowledged that capitalism could not survive without state intervention to mitigate its inherent brutality and instability.
Read more or Keynesian era from the 1930s to 1970s . If that era is now ending, the question is: what comes next? Will there be a new paradigm (some speak of a return to industrial policy, or a focus on climate-oriented economics, or conversely the rise of authoritarian state capitalism), or will neoliberal principles adapt and survive?

As of mid-2025, evidence points to a continued contest. On one hand, the neoliberal ideology has lost some intellectual luster – even major financial institutions and elite forums acknowledge issues like inequality, and there is talk of a stronger role for governments in areas like healthcare, green energy, and technology regulation. Populations have shown fatigue or anger with privatization and austerity; for instance, there’s increasing pushback against the privatization of essential services and a renewed interest in policies like universal basic income or higher taxes on the wealthy. On the other hand, many of the structures built under neoliberalism remain firmly in place: global supply chains, powerful multinational corporations, trade agreements protecting investor rights, weak labor unions in many countries, and a generation of policymakers trained to prioritize market solutions. The stock markets and corporate profits are reaching new highs, even as social problems persist – a dichotomy that itself is a product of the neoliberal era’s priorities.

In conclusion, neoliberalism is both an ideology and a historical era that fundamentally shaped the modern world. It promoted the creed of free markets, individualism, and a lean state, and this creed was put into practice through transformative policies in numerous countries. The results brought about increased wealth and innovation in some domains, but also rampant inequality, periodic crises, and a weakening of democratic and social bonds – outcomes that have galvanized a broad left-critical perspective against neoliberalism. Understanding neoliberalism is crucial for making sense of contemporary debates in politics and economics: whether it’s arguments about privatizing healthcare, deregulating tech companies, taxing billionaires, or managing globalization, the fault lines often trace back to neoliberal assumptions being questioned or defended. As we navigate the post-2020 world – grappling with climate change, pandemics, and new technologies – the neoliberal framework that dominated late-20th-century capitalism is under scrutiny as never before. Whether we are witnessing the end of neoliberalism or simply its evolution into a new guise, only time will tell. For now, recognizing its ideology, its history, and its impact equips us to participate more knowledgeably in these crucial discussions about what comes after “market fundamentalismMarket Fundamentalism Full Description:The quasi-religious belief that markets are not just efficient, but morally superior and self-correcting. It posits that the market is the ultimate arbiter of value and that any interference with market logic is inherently harmful and inefficient. Market Fundamentalism is the ideological core that sustains neoliberal policymaking. It extends the logic of the market into non-economic spheres, arguing that schools, hospitals, prisons, and even environmental protection function best when run like businesses competing for profit. Critical Perspective:This worldview ignores the existence of “market failures” and externalities (like pollution). By assuming the market is always right, it justifies the erosion of democracy; if the market is the perfect decision-maker, then democratic oversight is merely “red tape.” It reduces society to a collection of consumers rather than a community of citizens.
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Sources:

Harvey, David. A Brief History of Neoliberalism. Oxford University Press, 2005. Slobodian, Quinn. Globalists: The End of Empire and the Birth of Neoliberalism. Harvard University Press, 2018. Brown, Wendy. Undoing the Demos: Neoliberalism’s Stealth Revolution. Zone Books, 2015. Klein, Naomi. The Shock Doctrine: The Rise of Disaster Capitalism. Picador, 2007. Varoufakis, Yanis. “Neoliberalism is Dead. Say Hello to Techlordism.” Project Syndicate, 15 Apr 2025 Stanford Encyclopedia of Philosophy – Entry on “Neoliberalism” (2021) Wikipedia – “Neoliberalism” (various historical details and definitions) The Nation – Grandin, Greg. “How Pinochet’s Chile Became a Laboratory for Neoliberalism.” The Nation, 30 May 2022 The New Arab – Hamd, Yasmeen. “Remembering Margaret Thatcher & her deadly neoliberal legacy.” The New Arab, 8 Apr 2023 International Monetary Fund – Ostry, Jonathan et al. “Neoliberalism: Oversold?” Finance & Development, June 2016