2.1.1 Our Point of Departure: Two Innocuous Ideas

Centering our volume on the term neoliberalism is certainly a controversial choice. Indeed, the term is notoriously amorphous and contested by scholars. For more than a generation, neoliberalism has been explored as much more than a synonym for the economic deregulation and free-market ideology propounded by Margaret Thatcher and Ronald Reagan in the 1980s. Moreover, neoliberalism seems to have few if any self-acknowledged proponents. Therefore, a critical discussion risks targeting a straw man rather than a real position. However, as in the case of other messy, contested global concepts such as Christianity, Islam, socialism, or fascism, neoliberalism is a crucial topic of discussion because it refers to what many thinkers agree, and many people feel, is an influential phenomenon (Brown, Reference Brown2019: 17; see Slobodian and Plewhe, Reference Slobodian, Plewhe, Slobodian, Plewhe and Mirowski2020: 3–5). Furthermore, even if hardly anyone explicitly defends neoliberalism today, and even if it has in some contexts become little more than an intellectual swear word (see Williamson, Reference Williamson2004; Plewhe, Reference Plewhe, Mirowski and Plehwe2009: 8), this only challenges us to clarify its distinguishing features, as the influence of neoliberalism has become hidden rather than removed. In fact, the peculiar, “invisible” character of the influence of neoliberalism in contemporary society might itself be one of its most significant accomplishments.

Importantly, we won’t provide a historical account of how the neoliberal way of thinking acquired the widespread, if invisible, influence it now has in contemporary society. There is no single global historical trajectory. Rather, the paths that have led to neoliberalism’s influence differ from country to country: from actual coups and constitutions partly written by economics professors from the University of Chicago, to well-intentioned socialist governments unwittingly taking the importance of fiscal responsibility to imply the need for neoliberal governance. The present chapter describes a way of thinking, the neoliberal way of thinking, as well as the most prominent arguments that have been used for its justification. Whenever one wishes to challenge a particular neoliberal attempt at problem-solving and the type of thinking used in justifying it, the hope is that the present chapter will provide a terminology that will both assist in clarifying the underlying neoliberal assumptions and show why those assumptions are, in most cases, unjustified.

To get a precise sense of neoliberalism, then, we’ll begin our discussion from two well-known ideas that most of us accept:

1. 1. The value of individual liberty; and

2. 2. The fact of the efficiency of a free marketplace – a place where people can engage in voluntary transactions and where the relationship between supply and demand is allowed to determine prices.

We take these ideas to be innocuous and widely accepted, at least among readers coming from a liberal democracy. Let’s now take a closer look at these ideas, as neoliberalism really is just a particular combination of market and liberty thinking.

First, we have the core thought of liberalism. This is the idea that there is a fundamental value in the freedom of individuals to choose their own trajectory through life; they are “liberated.” This means that justification is needed whenever we want to introduce a societal structure that limits individual freedom (Mill, Reference Mill and Robson1963, vol. 21: 262; Gaus, Reference Gauss1996: 162–166; Rawls, Reference Rawls and Kelly2001: 44, 112). Or, when structures that limit freedom are retained, justification for this must be given. Typically, liberalists will defend some degree of restriction upon the freedom of individuals. They will claim that it is acceptable to restrict a single individual’s pursuit of his own goals whenever such behavior conflicts with the possibility fellow citizens have for being similarly free. For example, I am not free to push you around, no matter how much I may want to, as this interferes with your freedom to not be shoved. Precisely where those lines are to be drawn is one of the fundamental political tensions in “liberal” democracies – how much should we restrain people – and according to which freedoms or values? When might shoving in self-defense be allowed?

Along with this valuation of individual freedom goes the assumption that such freedom is only possible when people have the resources required to pursue meaningful choices. To some, this means that the right to possess private property is an inherent part of what it is to be free (Locke, Reference Locke and Laslett1960: chapter V). To other people freedom doesn’t consist in the right to privately own stuff, but that right is deemed a necessary means for sustaining the more substantial liberties that are sought after, such as the freedom to pursue one’s own interests without substantial interference (Hayek, Reference Hayek1960: 17–18). Notably, these values are compatible with forms of socialist liberalism (social democracy), where the state provides substantial social services through high taxation and/or ownership and control of significant portions of the economy such as healthcare or energy production. They are also, however, consistent with important strands of conservatism, notably the emphasis on social cohesion, as well as with libertarian conceptions of a minimal state that should only provide the most basic services such as policing, courts of law, and an army against external challengers. It’s because so many political perspectives embrace some form of liberal rights and constraint of government that we regard this minimal liberalism as relatively uncontroversial.

The other idea that most of us take for granted is that free markets can be effective for two important purposes: they can be a useful means of assigning capital to the production of goods, and they can be a helpful way to determine what goods should cost. We’ve gotten to a place in our societies where most of us specialize in our work. Despite the fact that we eat food, wear clothes, use computers, and so on, it would be really odd to find someone who grows all their own food, makes all their own clothing, and manufactures and programs their own computer. Once we allow for this kind of specialization in production, then everyone needs to acquire a variety of goods, from food and clothes to phones and computers, from other people in order to live their lives, Many also need to supply their surplus of produced goods of a particular type to others. The idea of the efficiency of the free market is that when we need to determine how many of us should produce, say, shoes, as well as settle how much each shoe should cost, then a good way of determining this such that society produces the goods that are needed for human flourishing is to allow free market forces to reign. Forces external to the willingness to engage in trade by exclusively self-interested buyers and sellers, typically the government, thus shouldn’t determine the size of shoe production, nor should they determine the price of each shoe.

As a recap, here are the two innocuous ideas we’ve been talking about from the liberal tradition:

1. 1. Justification is needed whenever we want to introduce or retain a societal structure that limits individual freedom (minimal liberalism).

2. 2. The willingness of self-interested producers and consumers to engage in exchange can in some contexts be the most effective means of assigning capital to the production of goods and for determining what goods should cost (limited marketization).

2.1.2 Market Imperialism

Starting from these seemingly basic and innocuous claims in the liberal philosophical tradition, neoliberal thinking makes a quite significant leap. A central, unique, and highly contentious claim of neoliberalist thought is that in order to best conserve and develop a liberal (a “free”) society, we should aim to align every social practice such that it becomes an actual or virtual free marketplace where goods or services are freely bought and sold by individuals. Everything should be organized as a market and the primary responsibility of the state or the government is to ensure these markets function efficiently while not interfering directly in their mechanisms. This liberal justification of expanding marketization is evident in the work of central neoliberal thinkers such as Milton Friedman (Reference Friedman1962), Gary Becker (Reference Becker and Becker1978; Reference Becker and Becker1996), and Friedrich Hayek (Reference Hayek1988).

We dub this universal pretension, whether it is implicitly or explicitly at stake, market imperialism. By imperialism we mean the hostile invasion, seizure, and occupation of other’s people’s space by foreign invaders. The term economic imperialism has been used to describe the aspirations of neoliberal economic theory to become the unifying theory of the social sciences (Gray, Reference Gray, Radnitzky and Bernholz1987: 33; Radnitzky and Bernholz, Reference Radnitzky and Bernholz1987). Analogously, we employ the notion of market imperialism to describe neoliberalism’s universal pretention as a problem-solving approach. Market imperialism is the idea that whenever we face a societal challenge, say treating the sick, educating the next generation, or combating poverty, we should approach that challenge by creating a form of marketplace structure and then allow the forces of a free market to govern the interactions of those involved. The uninhibited willingness of self-interested individuals to engage in trade was seen by traditional market thinkers (Smith, Reference Smith1976: chapter VII) as a good norm for how one should solve the challenge of determining price and production in a limited set of contexts. This approach is also seen, much more expansively, by the neoliberalist as the best way to solve every type of social problem that a society may face.

We might summarize the market imperialism of neoliberal thinking as follows:

• We should respond to every social problem by organizing an actual or virtual free marketplace where goods or services are exchanged between self-interested individuals (market imperialism).

Our interpretation of neoliberalism focuses on the problematic idea of market imperialismFootnote ¹. In Section 2 we criticize the attempts to provide principled arguments to defend market imperialism found in the works of Hayek, Friedman, and Becker. In this first section, however, we concentrate on describing the neoliberal conceptions of the state, civil society, international governance, inequality, and citizenship in which market imperialism is embedded. Note that by making neoliberal market imperialism the core target of our book, our theoretical contribution is therefore actually quite small; all we claim is that market structures are not always the best solution to a social problem. However, this small point can be of real political and social importance. It means that whenever we face a social problem, decision-makers cannot immediately assume that we should adopt a market approach and then place the burden of proof squarely on those who champion a different way of thinking about and solving the problem. Those who champion the solving of a problem by relying on marketlike structures do not begin from a superior position. The burden of proof is equally on them to provide us with good reasons to think that in this empirical case we should create some sort of market. However, as the empirical cases you are about to read in the following chapters will show, such good reasons are in many cases impossible to find, and the decision-makers often did not even bother to try to find any such reasons before opting for market solutions. In light of these diverse cases, and in light of the more general consequences of forty years of market imperialism, we hope that our small theoretical point can be leveraged to have a large and desperately needed impact on the way we teach and practice societal problem-solving in the future.

Again, our critical focus is on market imperialism as opposed to the two basic, innocuous ideas from the liberal tradition, minimal liberalism and limited marketization. We merely want to empirically disprove the idea that it is always the best approach to problem-solving to introduce market structures and rely on the forces of the free market. We simply seek to debunk the myopic dogmatism that, no matter what type of societal challenge you face, marketization is the proper response.

The limited focus of our critique has other significant consequences. First, our focus is compatible with the suggestion that the neoliberal tradition may contain genuine theoretical insights, apart from its problematic market imperialism. For example, neoliberal theory is often distinguished from classical liberal economic theory by emphasizing its rejection of a laissez-faire approach to markets. Neoliberalism actually wants a state and government, but only one whose main function is to maintain markets. Put another way, what distinguishes neoliberalism is “the problem of how to identify the factors indispensable to the maintenance of functioning markets, since the option of simply leaving them to themselves is no longer on the table” (Biebriecher, Reference Biebricher2018: 26; see also Slobodaian, Reference Slobodian2018). This definition emphasizes the interventionist, actively political nature of neoliberalism, and it gives lie to the prejudice that neoliberals necessarily aim to shrink the state. Our limited critical ambition is also an analytically useful starting point; in that it allows for the wide variety of conceptions of what kind of institutions best ensure the functioning of markets that we find in the neoliberal theoretical tradition (Biebriecher, Reference Biebricher2018: 26). Hence, our precise rejection of market imperialism allows problem-solvers to take seriously the neoliberal theoretical tradition’s insight about the proper maintenance of markets. In other words, our critique does not extend to the neoliberal idea that markets are constructed rather than a “natural” self-sustaining phenomena. When the application of the market form is a recommendable response to a societal problem, the contributions from neoliberal theories concerning how a competitive market should be institutionally maintained by the national state or by international regulation are relevant to consider. We might recapitulate this useful insight from the neoliberal tradition as follows:

• Markets are not inherently self-sustaining phenomena, but must be actively developed and maintained by government (market constructivism).

Second, our sole focus on rejecting market imperialism also leaves important theoretical debates about neoliberalism aside. Most fundamentally, we do not provide theoretical assistance for determining when marketization is justified, and when it is problematic. This task is obviously crucial, but our aim is to help effect a preliminary step; namely, to snap us all out of the tunnel vision of market imperialism and to begin to reassess problems and possible solutions in all their complexity. How we should be guided in this more open-minded reassessment leads into an extensive theoretical discussion about the legitimate domain of marketization that goes far beyond the scope of our book. This more expansive question might be spelled out as follows:

• When is it justified to respond to a societal problem by installing, maintaining or advancing markets (legitimate domain of marketization)?

2.1.3 The Neoliberal Conception of the State

As we emphasized in the Introduction, we think that this open-minded approach to problem-solving is both urgent and long overdue. The devastating consequences of more than a generation of dominance by market imperialism is becoming ever more obvious. The attempt to subject all spheres of society to market solutions has accelerated to a point where we need to be actively reminded that traditionally, many forms of social interaction were neither understood as, nor structured by, markets. The Hippocratic oath, the oath that doctors have taken at the start of their career since antiquity, commits medical professionals to assist those in need, regardless of wealth. This means that doctors have long conceived of a realm of obligation and human interaction that is not modelled on the paid exchange of services between solely self-interested producers and consumers. Likewise, education, marriage, poverty alleviation, friendship, employee motivation, punishment, burial, the election of leaders, and many other things that make up the normal fabric of our lives, have typically been very distinct in their conception and operation from that of the marketplace, with its individual selfish actors and its focus on profit. The neoliberals have argued that the job of the government is to marketize these aspects of societal life. Even practices initially foreign to market forces should be molded to become a market for competition among free self-interested consumers and producers.

According to neoliberals, in furthering the cause of the marketization of new societal domains the state plays a decisive role. In fact, according to one account, the prefix “neo” was added by some of the founders of neoliberalism to signal the need for reconceiving the state and its role “differently, and more clearly” than had been the case with liberalism (Willgerodt, Reference Willgerodt2006: 54–55; see Slobodaian, Reference Slobodian2018: 6). Their attempt to redefine the role of the state rather than to do away with it puts neoliberalists at odds with libertarians (Mirowski, Reference Mirowski, Mirowski and Plehwe2009: 436). Libertarians argue that the state, understood as the societal institutions that are government-owned and funded by taxes, should be reduced to the military, police, and courts whose job is to protect the citizens from theft, breach of contract, and fraud (Nozick, Reference Nozick1974). In this tradition the state is conceived in a minimal way as a “night watchman.” The neoliberal state, however, must be able to do more than this; its purpose is to govern decisively and to regulate in detail to allow for market competition and, thereby, produce and guarantee a stable market society with comprehensive marketization (Olsen, Reference Olsen2019: 7). Since the state is conceived as responsible for creating, maintaining, and nurturing the so-called competitive order, the neoliberal state can be understood as a competition state (Cerny, Reference Cerny1997) rather than merely a minimal, night-watchman state. Indeed, the common theoretical point of departure for most neoliberals is that the state has “positive functions to perform, and they are neither confined to guaranteeing private contracts, or, more generally, enforcing the law” (Biebricher, Reference Biebricher2018: 34).

When advocating interventionist politics, neoliberals typically do so in order to further strengthen and sustain the popular acceptance of the competition state. A paradigmatic example is the so-called interventions for adjustment proposed by Wilhelm Röpke and Alexander Rüstow. Röpke and Rüstow advocate interventions by the state if they acceptably combine security with flexibility. Interventions should on this view be designed to “ameliorate the hardship of prolonged unemployment at the individual level, but assume the ability and willingness of individuals to retrain their entire career in order to replace devalued human capital through a more profitable stock” (Biebricher, Reference Biebricher2018: 41, cf. 36). In this view, people become a sort of human capital traded on a labor market. Moreover, people-as-human capital are expected to completely change their life course and re-train for different careers and professions should the labor market demand it. What distinguishes neoliberal social policy is thus its individualist character and that it is indeed employed in order to “responsibilize” citizens to become economically self-sufficient.

This approach to unemployment has been influential in Western Europe, not least in the “flexicurity” models developed in the Nordic countries (Pedersen, 2006). They can be termed competitive interventions in so far as they help to reproduce the necessary conditions for sustaining and intensifying market competition in society. On a general level, neoliberals have agreed that the superior social policy is economic growth, and that inequality is “not only the natural state of market economies, but it is actually one of its strongest motor forces for progress” (Mirowski, Reference Mirowski, Mirowski and Plehwe2009: 438; see also Piketty Reference Piketty2020: 705–716). Put another way, material inequality (some quantum of human misery) between citizens is an important, necessary feature of social life because it motivates people to compete in market settings.

As for the state institutions and public organizations themselves, neoliberals have with considerable success argued that they should be subjected to practices and principles drawn from the market sphere “so that even core functions of the state are either subcontracted out to private providers or run (as the saying has it) “like a business”” (Ferguson, Reference Ferguson2009: 172). The subcontracting or outsourcing of public services to for-profit organizations is often euphemistically labeled public–private partnerships. In a typical case, this simply means that a private company is contracted by the state for a number of years to design, build, finance, and operate a public service that would otherwise have been provided by public sector institutions. Finally, in order to ensure “accountability” within the reformed state institutions, the neoliberals have sought to restructure them with “techno-managerial governance”, such as numerous audit devices and market metrics (Mirowski, Reference Mirowski, Mirowski and Plehwe2009: 436). In this way, governing for the market tends to create a lot of state action and often demands extensive bureaucratization.

One example of this phenomenon from the academic world is the application of the so-called Research Excellence Framework to public universities in England. This framework judges “every academic endeavor by its uptake in non-academic venues (commerce, state agencies, NGOs)” (Brown, Reference Brown2015: 196). Subordinating academic work to instrumental demands inevitably draws the focus of universities away from their traditional core tasks of cultivating humanistic and critical values and pursuing basic research.

The differences between the libertarian and neoliberal conception of the liberal state can be summarized as follows:

2.1.4 The Neoliberal Conception of Civil Society

The notion of civil society is inherited by neoliberalism from the larger liberal tradition. At its most basic, “civil society” refers to social relations between groups and individuals in so far as they have historically developed to take a different form than the relations within state institutions or markets. As members of for example NGO’s, social movements, religions, or families, individuals or groups are not directly acting within the framework of state institutions or governing bodies, but also are not merely agents involved in the exchange of goods or services. Rather, they are part of, the “third sphere,” of civil society. For neoliberals, civil society is full of promises, possibilities, and dangers. It is first and foremost an inexhaustible reservoir for further colonization by market forces. In this sense, the neoliberals do not accept that civil society should be fenced off, as it were, from the sphere of the market: “Everything is fair game for marketization” (Mirowski, Reference Mirowski, Mirowski and Plehwe2009: 437). It is the responsibility of state government to facilitate this process. The role of the competition state is to govern the social relations within civil society so as to cultivate groups and individuals for participation in the market, thereby expanding and intensifying the sphere of market competition within society. At the same time, civil society is assumed to be the domain from where forms of resistance to the state can grow that can be potentially useful for neoliberal aims. Social movements, for example, can mobilize pressure on the state “from below” in order to intensify the competition state, discipline its politicians and help protect the interest of corporations.

Yet, civil society is also a potentially dangerous breeding ground for social movements that seek to disrupt and change the neoliberal form of state government, or who turn their political energy directly against corporations and market activity. Groups within civil society must therefore be constantly monitored, contained, and modulated by an often subtle and indirect government. Despite attempts to change and colonize it, civil society is never completely subsumed. Fundamentally, civil society is a continuously present horizon for neoliberal political interventions, partly due to the constantly changing nature of the forms of non-marketized social interactions we engage in as human beings. In this sense, the fundamental neoliberal task of governing for market competition is never fully realized. There are always more social relations and processes to be domesticated by market forces, but also an ever-present potential for challenges and set-backs from recalcitrant groups and social movements. The social bonds in civil society both provide potential support for economic processes and economic bonds between people, while at the same time “overflowing them and being irreducible to them” (Foucault, Reference Foucault2008: 301).Footnote ²

The ambiguous nature of civil society to neoliberal thinkers can be summed as follows:

• Civil society is an inexhaustible social resource for expanding, and a social precondition for sustaining a competitive market society (civil society as a promise).

• Civil society is a dangerous reservoir for resistance and potential disruption of market structures and corporate power (civil society as a threat).

2.1.5 The Role of International Institutions and Governance in Safeguarding the Market Order

As recent scholarship has investigated, the adherence to a strong competition state is in neoliberalism combined with the idea that nation-states themselves have to be disciplined “from above” (Biebriecher Reference Biebricher2018; Slobodian Reference Slobodian2018). The international dimension of neoliberalism has been most forcefully expressed as a philosophy of global ordering, developed in particular at the University of Geneva by Ludvig von Mises, Friedrich Hayek and Lionel Robbins and many others throughout the twentieth century. This group of neoliberals not only coined ideas, but also helped to translate them “into policy or institutional design through partnerships with politicians, bureaucrats, or businesspeople” (Slobodian, Reference Slobodian2018: 24). The neoliberal philosophy of global ordering has been extremely influential, not primarily because of its contributions to economic theory, but in particular as an inspiration for statecraft and institution-building. Its most significant achievement has perhaps been the establishment of the World Trade Organization (WTO) in 1995, but the ideas of the Geneva “globalist” school have also shaped the institutional development of the European Economic Community (EEC) and the European Union (EU) to a significant extent (Sloboidian, Reference Slobodian2018: 182–262; see also Streeck, Reference Streeck2017: 154).

The first neoliberal argument for international governance should be understood in light of their understanding of the nature of competition. For Hayek, and other neoliberals following his line of thought, competition is an endless process of discovery and learning where the outcome cannot be determined in advance (Hayek 1968; Slobodian, Reference Slobodian2018: 206, 213). When states compete against each other in order to provide the most favorable policies for investment and enterprise it facilitates such open-ended competition (Biebricher, Reference Biebricher2018: 63; Slobodian, Reference Slobodian2018: 267). However, in order to ensure that states compete to provide ever better frameworks for competition, they must be committed to secure the free flow of goods, services, capital, and labor. In this perspective, nation states appear in an ambiguous light: The creative and open-ended game of market competition is facilitated by nation states that compete for international investments, but at the same time capital must be able to follow opportunities across borders. Therefore, the neoliberal form of globalism does not envision a world without borders but attempts to erect a “worldwide institutional grid that offers transnational capital multiple exit options” (Brenner, Peck and Theodore, Reference Brenner, Peck, Theodore, Gill and Claire Cutler2014: 129; see Slobodian, Reference Slobodian2018: 266–267).

The removal of capital controls, that is, allowing wealth to roam a borderless world, plays a significant role in the worldview of the neoliberals because it induces countries that have successfully drawn investors to establish conditions sufficiently favorable for foreign capital to remain. The neoliberal endeavor hence includes the formulation and enforcement of “international investment law designed to protect foreign investors from diverse forms of expropriation” (Slobodian, Reference Slobodian2018: 4). In a sustained effort the neoliberals have sought to build institutions that could force state governments to limit their own sovereign prerogatives (say to tax) in order to protect capital. In simple terms, the principle they seek to enforce is that governing a territory does not entail owning the property within it (Slobodian, Reference Slobodian2018: 139). Thinkers in this globalist strain of neoliberalism have even attempted to appropriate the language of human rights to make this argument. By focusing less on the condition of the stateless person, but rather on the rights of the investor, they effectively proposed the right to capital flight already in the mid-twentieth century, and more recently neoliberals have criticized the UN human rights covenants for failing to offer effective protection for property rights and economic freedoms (Slobodian, Reference Slobodian2018: 135, 279).

The guiding and immensely influential idea of the Geneva School of neoliberalism is thus to encase market structures and property rights in a framework of codified norms and rules that supersede national laws. The competition laws developed in the European Economic Community and European Union are an example. In fact, in their attempt to shape the transformation from the General Agreement on Tariffs and Trade (GATT) to the World Trade Organization (again, WTO), the economic market order as it was realized in the EEC played a guiding role for the neoliberals (Slobodian, Reference Slobodian2018: 256). The principle that common European law overrides the national law of member states, and the fact that individual citizens as well as corporations could appeal to European law in their domestic courts, made the EEC a useful paradigm of an appropriate market order on a global level (ibid.).

Finally, many neoliberals are convinced that the world market needs the institutional support of international law and political norms to be maintained and, not least, protected from misconceived perceptions of popular sovereignty. Democracy is a threat to the functioning of the market order, because democratic majorities inevitably will demand redistribution of wealth (Slobodian, Reference Slobodian2018: 272). In 1978, the economist and president of the neoliberal Mount Pelerin Society, George Stigler reflected on the nature of neoliberalism as a “minority view”, and asked the following rhetorical question: “If in fact we seek what many do not wish, will we not be more successful if we take this into account and seek political institutions and policies that allow us to pursue our own goals?” (Stigler, Reference Stigler1979; quoted in Slobodian Reference Slobodian2018: 237).

The second neoliberal argument for international institution-building is therefore that the will of people must be put on a leash by insulating markets from their potentially harmful interventions. Whereas the first argument emphasized how international law and multi-level governance can function to intensify competition, the second argument focuses on how rules formulated, maintained, and enforced by international institutions may serve to constrain what the neoliberals consider the dangerous egalitarian tendencies of democracy. With imagery that invokes a famous scene from Homer’s Odyssey, the aim of international institutions and governance is to tie, with hands bound and wax in his ears, the Ulysses of the democratic state to the mast of the world economy (Slobodian, Reference Slobodian2018: 273). Thus bound, the state is unable to listen to or follow to the democratic majorities that presumably legitimate it.

The first neoliberal argument for international institutions and governance can be summarized as follows:

• Market competition can be stimulated by the competition between states. Therefore, states must be committed and incentivized by international institutions and governance to offer the most attractive climate for the conduct of enterprise and for investment of capital (stimulating competition).

The second neoliberal argument for international institutions and governance can be summarized as follows:

• Democracy is constantly liable to result in government failures where special interests or popular majorities pursue egalitarian policies to the detriment of property rights and the market order. Therefore, democracy must be constrained by international institutions and governance in order to safeguard the market order and property rights (constraining popular sovereignty).

The two lines of argument require the same response: International institutions and governance must provide and enforce rules, norms, and laws that strengthen and protect the market order and commit nations to full participation in the world economy. The international rules must be able to override national laws or even be integrated in the national constitution and, thereby, commit the states to secure the free flow of goods, services, capital, and (to some extent) labor. International rules must provide individual capital owners and corporations with exits, and in case they perceive their property rights or right to trade to be infringed upon by the government of the nation state, they should be able to appeal to international courts whose rulings take priority over the courts of the nation states.

2.1.6 Neoliberalism and the Problem of Inequality

The primary challenge which neoliberalism faces from a democratic government is the inherent tendency of the majority to favor some form of wealth distribution in the face of sufficient inequality. It is a common neoliberal idea that pursuing egalitarian policies beyond equality before the law is dangerous to the social order and human wellfare. Inequality is not a phenomenon to be combatted, let alone overcome, but a force of progress that works to the benefit of all members of society (no matter how wretched some may be). To many neoliberals the protection of private property rights is seen as the primary political priority at any level of governance. While we initially presented neoliberalism as the marriage of minimal liberalism and the idea of the expansion of the market, it is well-established that for central neoliberal thinkers the idea of liberalism gradually narrowed into the mere idea of property rights with little respect for the further liberal values and freedoms that modern democracies are typically built to ensure. Friedman and in particular Hayek’s justification of (semi)authoritarian forms of government, and in particular their willingness to admit the suspension of democratic rule and accept a transitional dictatorship under certain circumstances is well documented (Mirowsky, Reference Mirowski, Mirowski and Plehwe2009: 446; Biebriecher, Reference Biebricher2018: 103–106; 142–149).

While Friedman and Hayek are no doubt extreme compared to the many more moderate neoliberals in contemporary governments, who do respect the typical broader notions of liberties, it should be kept in mind that this inherent tension remains embedded in neoliberalism. Whenever the markets created by neoliberal policies are challenged by democratic demands for equality or obstructed by the respect for further non-property related civil liberties, then the neoliberal needs to evaluate what takes priority, marketization and property rights or minimal liberalism. Despite how this internal discussion pans out within the specific neoliberal debate, one thing is certain: neoliberal thought idealizes a form of inequality typically created by market structures and politically defends this by the questionable claim that even the poor are better off by allowing such rampant inequality (For an extensive empirical criticism of this claim, see Piketty Reference Piketty2014).

The Neoliberal view on inequality can be summarized as follows:

• Everyone will be better off by accepting inequality of outcomes, even if inequality levels remain significant or grow larger (positive effects of inequality)

2.1.7 The Neoliberal Conception of the Citizen

After more than three decades of dominance, neoliberalism has according to some of its critics shown its potential to change how democratic citizens understand who they are (e.g. Brown, Reference Brown2015; Reference Brown2019). When competition is installed as the fundamental principle of social dynamics, inequality, rather than equality, gradually becomes more legitimate, if not idealized, in every sphere of society (Brown, Reference Brown2015: 64). Perpetually involved in the game of competition, all actors are conceived as capital and the human capital theory propounded by neoliberal economists (Becker, Reference Becker1993) increasingly expresses the implicit anthropology of society. The consequence is that the self-conceptions of members of society are increasingly shaped according to the ideal of the individual entrepreneur: “As capital, every subject is entrepreneurial, no matter how small, impoverished, or without resources, and every aspect of human existence is produced as an entrepreneurial one” (Brown, Reference Brown2015: 63). Each individual subject is cultivated to govern himself as “an entrepreneur of himself”, “being for himself his own capital, being for himself his own producer, being for himself the source of [his] earnings” (Foucault, Reference Foucault2008: 226; Slobodian and Plewhe, Reference Slobodian, Plewhe, Slobodian, Plewhe and Mirowski2020: 14). Individual decisions are evaluated in terms of market metrics that focus on the return of investment, and state institutions and policies seek to multiply and differentiate the enterprise form throughout the social body.

Think about this idea once more. How many of our choices in life should be thought of as entrepreneurial investments? Often it would probably be better if we decided to do something because it was kind, created something of lasting importance or, simply, because it was the right thing to do. The more our ways of thinking are dominated by an entrepreneurial self-conception, the more such reasons for action are forgotten and exchanged with a concern about what one personally profits from a course of action. Rather than lamenting this narrowing of our reasons for action, neoliberals either applaud the change, or even more sinisterly claim that no change has occurred because deep down, despite the pretty words, we were always already only looking out for our own profits.

As market, competition, and entrepreneurship become the formative powers of society, education in general, and higher education specifically, is prioritized for purposes of capital enhancement and maximizing competitiveness, rather than for “developing the capacities of citizens, sustaining culture, knowing the world, or envisioning and crafting different ways of life in common” (Brown, Reference Brown2015: 177–178). This conquest of education by economic concerns threatens democracy. When public secondary and higher education in Western countries focus on developing human capital, rather than on providing citizens with the capacity to understand the powers and problems that surround them, their ability to take part in self-government is steadily undermined. What is eroding in this process is ultimately our self-conception as equal citizens, and our ideas of “society” and “the social” as a space where “citizens of vastly unequal backgrounds and resources are potentially brought together in common action. It is where we are politically enfranchised and gathered (not merely cared for) through provision of public goods and where historically produced inequalities are made manifest as differentiated political access, voice, and treatment, as well as where these inequalities may be partially redressed” (Brown, Reference Brown2019: 27). As this idea of the social increasingly vanishes from our thoughts, speech, and experience, it also threatens to disappear from our visions of the future, our political imagination (Brown, Reference Brown2019: 52).

The neoliberal view of the individual can be summarized as follows:

• The self-conception of the citizen should be that of an entrepreneur in a double sense:

  1. 1) The ideal form of work and citizenship is supplying a good or service to the market for profit, i.e. to start one’s own business (idealization of entrepreneurship); and

  2. 2) Each individual should commit to being an “entrepreneur of oneself”, perpetually attempting to maximize the returns on investments in his or her human capital (entrepreneurial anthropology).

Although our book does not deal with how neoliberalism challenges our conceptions of democracy and a flourishing society, the cases you are about to read depict alternative political responses and non-market based social practices, which go beyond neoliberal dogmas in a variety of different directions. Our hope is that an exploration of these existing alternatives to the current neoliberal market orthodoxy may critically complement the bleak picture painted by some of neoliberalism’s critics. Thereby, we in this anthology hope to not only criticize neoliberalism’s market imperialism, but also hope to contribute to a refueling of our political imagination, as well as inspire future theories that seeks to limit and restrict the times and places where the applications of market solutions are justified.

2.2.1 The “Human Nature is Self-interested” Argument

The first argument runs as follows:

Famously, Adam Smith (Reference Smith1776, bk 1, chap. 2) pointed out that when people go to the market to acquire groceries, we do not expect them to act out of altruism when they chose which goods to buy. Rather, he identified that the efficient solution to the cooperation problem of how much to produce of each retail good in a society, and at what quality, could be adequately solved by relying on the self-interested behavior of those freely buying at a market. When it came to buying day to day household provisions, people were primarily motivated by self-interest and, in light of that, a free market was an efficient way of handling the issues of social cooperation related to the production and consumption of household goods. For other social organization issues, such as care for the family and societal governance, Smith (Reference Smith1759) thought we needed to rely on other forms of human motivation, such as our sense of justice and piety.

The key to the “Human nature is self-interested” argument is the claim that Smith and likeminded theorists were naïve in thinking that humans are ever motivated by anything beyond the rational self-interested pursuit of a set of stable personal preferences. The form of human motivation that Smith identified at the marketplace is in fact the only form of human motivation there is. It is simply a harsh anthropological fact that beneath our veneers of morality and loyalty, we are really only acting based on the enlightened pursuit of self-interest. We are essentially and always maximizers of our own personal utility. Hence, in a sense, every social interaction is already a form of a marketplace. Only what we trade isn’t solely provisions and dry-goods, but also the satisfaction of more subtle needs, such as our craving for recognition or safety, our intellectual curiosity, the proliferation of a religion we prefer, and many other of our more abstract personal preferences. And if, as the argument goes, we are always and only motivated by self-interest, then the quid pro quo of the marketplace is the best way of getting everyone to cooperate.

The pressing question is why anyone would ever dream of acknowledging that the second premise is true. Scrutiny of the human activities around us seems to immediately display its obvious falsity. Altruistic action abounds, from the care families give to needy children and elderly, to volunteer work, or the loyalty shown to friends, social groups, and even to places of work or the environment as such – even when, and perhaps especially so, these people, places or things don’t love you back. Indeed, many of the successful alternative solutions to real empirical problems that you will read in the following chapters function precisely by relying upon the fact that people can be motivated by other factors than self-interest. This is where the neo-liberal argumentation turns insidious. The first step taken in convincing people of our essentially self-interested nature is to move from the idea of the marketplace, where we are interested in money and physical goods, to the idea that we are also self-interestedly maximizing our acquisition of further more ethereal goods, such as confirmations of our self-conceptions, the implementation of our personal sense of justice, and our pursuit of public recognition.

This expansion of our egotistical goals from solely pecuniary and material to include anything one can conceivably strive for is perfected in the work of economist Gary Becker. Smith (Reference Smith1759) famously excluded family life from the arena of human cooperation governed by self-interest. In his major work A treatise on the family, Becker’s (Reference Becker1981) aim is precisely to expand Smith’s conception of our self-interested market motivation beyond those confines. He writes: “This volume uses the assumptions of maximizing behavior, stable preferences, and equilibrium in implicit or explicit markets to provide a systematic analysis of the family” (Becker Reference Becker1981: x). Becker accomplishes this expansion precisely by assuming that, whatever goals you may have, what you strive for can be understood as some relatively stable preference that you rationally maximize your personal utility by satisfying.

Thus, by a stroke of definition, you are now a maximizing self-interested individual, even when you donate to charities and do volunteer work. For what you are really doing is not motivated by the needs of others. Deep down you are simply pursuing your self-interest by maximizing the utility you get from supporting your self-conception as someone who donates or helps those in need. Moreover, and this is important, according to the neoliberal theory such seemingly altruistic behavior is ultimately substitutable by a sufficient increase in the satisfaction of any of your other preferences. There is no amount of commitment to altruism or loyalty that cannot be trumped by enough cookies, fast cars, or money. Every noble goal you pursue, every principle you adhere to, will according to economic maxims be trumped by the promise of sufficient satisfaction of your other desires (Becker Reference Becker1981; Jensen Reference Jensen and Meckling1994: 7). Put another way, everyone has their price.

Once we have expanded the notion of self-interested maximizers from the pursuit of pecuniary and material interests to the pursuit of personal utility, then there is obviously no behavior that cannot be analyzed as motivated by the maximization of self-interest. If someone explains that they do something because they owe it to their neighbor, or because they think it is right, then it can be explained as their unacknowledged pursuit of the personal utility they derive from living according to those ideals. And if someone consistently upholds a given principle in their actions, seemingly unwilling to compromise for any substitute, then the answer will always be that this is simply because they haven’t been lured with sufficient amounts of alternative utility. None of us are actually ever motivated by ideals or principles, only by self-interest. We may think we are, but we are at best insufficiently rewarded for abandoning our previous higher ground, and that explains seeming cases of moral fortitude against personal temptation.

When the idea that we are self-interested maximizers of wealth and goods is expanded into the idea that we are self-interested maximizers of personal utility, and when enough alternative explanations and theoretical bells and whistles are added to the theory, this theory of human nature becomes impossible to empirically falsify. It becomes axiomatic. However, what is overlooked in the neoliberal argument is that it also becomes impossible to employ in the defense of market imperialism. Consider the following: if we are indeed self-interested maximizers of personal utility, but sufficiently many of us acquire great personal utility by, say, being loyal toward our group and acting in its best interest, or acquire personal utility by behaving altruistically and doing our duties, then why do we need market forces to best organize our cooperation? It seems that our personal preference for loyalty, duty, compassion, and the like, should be sufficient and possibly even superior in the organization of our cooperation than the quid pro quo approach of the market transaction.

In effect the neo-liberal argument above acquires its seeming effectiveness through equivocation. Let us grant that it is true that if we were indeed self-interested in the narrow sense of pursuing only wealth and material goods, then market forces would be the best way of organizing cooperation. However, as we have emphasized, it flies in the face of all common sense and experience that we are essentially only motivated by the personal pursuit of wealth and material goods. People pursue all kinds of aims, not only wealth and material goods. In other words, a narrow reading of premise 2 is obviously false.

Alternatively, lets follow Becker’s flight forward and expand the notion of maximization to the goal of personal utility, such that premise 2 becomes even remotely defensibleFootnote ³. That is, let us expand the notion of our self-interested pursuits, such that we are maximizers of personal utility in the sense that we sometimes also pursue further values, such as altruism and loyalty and duty, though only as a means for self-gratification and never as an end in itself. In that case, premise 1 is false. Because then it will no longer be the case that the quid pro quo of the marketplace is always the best way to organize our collaborative problem-solving. Sometimes it may be more efficient and preferable to rely on our natural preferences for social cohesion and feelings of obligation. In fact, a series of the cases in the rest of the book present real empirical examples, where relying on non-economic motivation was more efficient in our problem-solving. Hence, there is no reading of the “human nature is self-interested” argument where both its premises are true. It relies on subtle equivocation in its claims to justify the market imperialism championed by neoliberalism.

2.2.2 The “Tyranny is the Only Alternative” Argument

The next argument is probably best introduced in the voice of the economist Milton Friedman, who was both its most famous defender and a major formative influence at the Chicago School of Economics which was, and continues to be, one the main centers of neoliberal thought:

Friedman here provides an argument from exhaustion, which is echoed in the writings of Hayek (Reference Hayek1944).

The problem with the argument is so obvious that it almost merits no explanation. Clearly the first exhaustive premise that we can only coordinate human cooperation through coercion or market mechanisms is false. As just established in the discussion of the former argument, humans can be motivated by many different factors. Each of these motivations can form the basis for human coordination, not just our economic interests or the brute force of tyranny. Maybe I value the social cohesion in our group and so does the rest of the people in our group. This motivational factor can then be used to coordinate our efforts, and this amounts to neither the economic quid pro quo of the marketplace, nor to the coercive techniques of tyranny.

Friedman also employs an individualistic conception of humans which overlooks that in many cases we might need no motivation to coordinate. We might already be adequately coordinated by shared cultural features, such as shared language, shared traditions, or other shared systems of meaning. The typical failure of exhaustive arguments is to overlook viable alternative options, and this argument is no different.

Despite its simplistic nature, this argument is well-known from politics, especially in the USA, where it seems that any mention of democratic socialist reforms, such as universal healthcare and free education, are immediately associated with the repressive tyranny of some vaguely-conceived communist dictatorship. That democratic socialist policy, which relies not on market transactions but on a communal feeling of responsibility for each other, cannot be separated from coercive and oppressive tyranny shows that despite its obvious flaws, the “Tyranny is the only alternative” argument still has widespread political influence.

But wait, you might think, aren’t you misreading Freidman? After all, he merely writes that our economic activities can only be coordinated by coercion or the free market. Whereas you interpret him as saying that all human cooperative problem-solving can only be coordinated by coercion or the free market. It is true that we extend his argument beyond the quote, but there are reasons for doing so. First of all, Friedman himself typically interprets his own statement as having practically universal scope, such that for example the provision of healthcare, the building of societal infrastructure, and education are also trivially and without argument included as activities that are economic in some sense. Secondly, unless the argument is read as including all cooperative activities, it cannot support the market imperialism that neoliberals use it to justify.

If we acknowledge that only our problem-solving concerning specific economic issues is limited to either coercion or the market, then one might agree that we should prefer free market solutions to our economic problems, which is indeed what we, the authors of this chapter, think. However, the pressing question then becomes which types of problems should be construed as economic, and which problems should be construed as, say, political, educational, moral, or ethical. The essence of market imperialism is precisely the claim that all problems should be solved with market solutions; and the universality of that claim cannot be supported if we acknowledge both that non-economic problems may have other alternative forms of coordination that are viable and accept that not all problems are economic. Hence, on the strong reading of Friedman’s argument we presented first, its first exhaustive premise is obviously false. On the second weaker reading, where it only concerns economic coordination, it cannot support the universal application of market solutions that is the very essence of the neoliberal approach to problem-solving.

2.2.3 The “The Market Knows Best” Argument

The final argumentation in favor of neo-liberalism’s market imperialism that we want to consider is humbler than the two arguments we’ve already evaluated. It neither claims that we are inherently and implicitly engaged in self-interested market calculations whenever we interact. Nor does it argue that every non-market approach to cooperative problem-solving is morally reprehensible. It simply claims that though there may be many commendable ways of approaching coordinated problem-solving, as a matter of fact, better solutions are always found by employing free market mechanisms. The argument is epistemic; we always discover the best solutions by letting decisions of what to do be determined by market forces. This type of argument comes in two forms, one that underestimates our human capabilities for discovering solutions and one that overestimates the ability of free market outcomes to find the optimal solution to our practical problems. We can call them the “humans are too dumb, and the “the market is incredibly smart” arguments.

2.2.4 The “Humans Are Too Dumb” Argument

The argument runs as follows:

Argumentation along these lines is famously championed by Hayek (Reference Hayek1945), when he argues that the automatic price regulation of the market functions is our only available option for handling problems that are too complex for individual human cognition to grasp. Notice though, that the core of neo-liberalism is its market imperialism, which claims that all problem-solving should be left to market forces. In order to defend that conclusion, the critical issues are 1) if all our problems are too complex for human conscious cognition to adequately evaluate, and 2) whether it really is true that the market always adequately responds to the relevant features of those problems. The contentious premises of the argument are thus premise 2 and premise 3. However, those premises are both obviously false in the strong universal reading required to justify market imperialism.

Clearly, there are certain problems which humans can easily grasp the complexities of and thus consciously plan an effective solution to. Mundane problems such as who should take the kids to school or where to buy milk spring to mind. More importantly, as many of the coming papers will show, even for quite complex problems such as handling water supplies (Randle, Chapter 5) and organizing parking in major cities (Souleles, Chapter 10), conscious human prediction and problem-solving can outperform market-based mechanisms. Hence, the scope of problems for which premise 2 is true is certainly less than the universal scope required to support the conclusion of market imperialism.

Likewise, there are obviously societal problems where free markets are irresponsive to features we know to be relevant to adequate problem-solving. In particular, problems with easily foreseeable long-term effects are poorly reflected in market prices despite being well-known to human deliberators. This is because the long-term consequences of various market decisions are screened off from immediate economic relevance by the interim fluctuations of the market. In economic terminology, the “externalities,” the things outside a market aren’t properly internalized in the market. We certainly know that undermining the education system or destroying our ecosystems have long term detrimental effects, both economically, but even more so socially and morally. However, these negative effects aren’t, and often cannot be, reflected in contemporary price mechanisms as there is often adequate profit to be made until the widespread negative consequences set in and destroy a given market’s larger societal context. Hence, the universality of premise 3 is also obviously false in the strong reading required by the neoliberal argument.

Once again, the remaining question is why anyone would ever believe this argument. It seems to get its motivation from a form of slippery slope fallacy. In their writings, both Friedman (Reference Friedman and Friedman1982) and Hayek (Reference Hayek1944) primarily compare the attempts to centrally plan production and consumption of material goods in the Soviet Union with the alternative of letting the gradual rise and fall of prices on a free-market signal which resources are in scarcity and abundance, relevant to human needs. They are both certainly right that when we consider the production and consumption of fairly ordinary goods, then this is surely both too complex a system to grasp in human cognition and also a system fairly adequately reflected in the price mechanism of the market. However, the fallacy in play is when we start to think that because a free market is the most effective method available for solving the problem of national or global production and consumption of ordinary goods, then it must also be the best approach to solving either issues of less complexity or issues of equal or greater complexity which do not deal exclusively with ordinary goods. It is suddenly assumed without argument that the comparatively more complex issue of motivating a specific group of employees, or the organization of consumption of esoteric “goods” such as CO2, crime, and education, are also problems best solved by relying on market mechanisms. However, this issue requires empirical investigation of the specific problem one faces. It may be that human conscious deliberation can indeed grasp the complexities of the relevant issue and find a better solution than that orchestrated by blind market forces. Or it may be that the market is in this specific case insensitive to the features relevant to adequate problem-solving, features which human deliberation would immediately take into account.

In other words, the tacit presumption that a market solution must be the way forward can only be justified if we accept premise 2 and premise 3 above in their universal interpretations, and those are obviously and undeniably false. What we should accept are the weaker reasonable premises that sometimes we cannot grasp the complexities of a problem, and sometimes a market of some sort is indeed responsive the relevant complexities that we cannot grasp. But these premises only allow us to conclude that for any problem we face, we need independent argumentation and justification that shows why this case is indeed one of those where blind and passive market forces provide better solutions than conscious human deliberation and orchestration.

2.2.5 The “The Market is Incredibly Smart” Argument

This argument in favor of market imperialism doesn’t take its grounding in the deficiencies of human cognition, but rather in the presumed perfections of the market. It goes as follows:

This argument typically relies on drawing analogies between market forces and evolutionary forces, yet, in doing so, fundamentally misunderstands both. The comparison of market forces to evolution has a long tradition. It is exemplified in influential work by Alchian (Reference Alchian1950) and Hayek (Reference Hayek1988). The rough idea is that a free market will allow for myriad potential solutions to our problems to emerge. Blind market forces will then function by passively selecting the optimal solution, whereas the rest will automatically dissipate. The slogan is captured in Herbert Spencer’s (Reference Spencer1865) misunderstanding of evolution as a process of natural selection that ensures the survival of the fittest – a slogan he used to justify an early form of racist, social Darwinism of precisely the type that underwrites this second epistemic argument in favor of neo-liberalist problem-solving. However, the slogan is false, evolution isn’t a directional process of survival of the fittest. It is process of survival of those who accidentally happen to survive.

The fittest finch ever to exist probably died due to a lucky predator, a random lighting strike, or an uncommon draught. However, the odds of dying are slightly lower among animals better fitted to their environments, which means that if we repeat the process of survival of those who happened to survive an incredible number of times, then we will have a population which is on-average better suited to its environment compared to what random variation alone would have resulted in. Survival in this evolutionary sense is thus 1) due to random, non-directed variation, 2) context-specific, and 3) essentially a group or population-level phenomenon. Some elements of markets work sort of like this: There is great uncertainty as to what firms or solutions will prosper on the market; that is why it is fraught with risk. A lot of bad ideas get funding, and a lot of good ideas fail to prosper. Perhaps, on average, if we look at the companies that persist decade after decade, then they cannot be half bad. Yet very often, better companies have in fact been out there, but perished due to random accidents, such as a single bad CEO, a bankruptcy among subcontractors whose effects spilled over, starting up just prior to the outbreak of a pandemic, etc. Notably, deliberate human intervention can sometimes beat the blind selection of the evolution-like process of the market. Just like selective human breeding have created specialized farm animals at a faster pace and with different results than those that would have occurred by natural selection. For example, instead of blindly allowing market prices to determine which companies survive and how they alter after we internalize the cost of CO2 by introducing tariffs, we could probably just target specifically harmful industries by deliberate regulation and prohibition, just like we deliberately singled out certain high-volume milk-cows for further breeding.

A second issue of equal importance is the slow speed of development and the high casualty rate inherent to both evolution and market forces. Free-market forces function by allowing everyone to go on in their own way. Just like random mutation in the evolutionary analogy, this creates the required variety for the process to function. Without variety even evolution fails to provide well-fitted creatures, as cases of inbreeding attest to. Of this variety, those companies that are most ill-fitted to their surrounding environment have the greatest odds of perishing. However, just like in nature, where a poorly fitted type of finch may survive for several generations before perishing; likewise, a bad way of solving our problems may persist for a long time before some market mechanism actually kills it. This despite the fact that the most cursory deliberate evaluation would allow us to see that, from a societal perspective, this form of problem-solving was nowhere near optimal, and may in fact be harming lots of people, as in the case of, say, fossil fuel exploration or asbestos manufacturing.

The market isn’t infinitely fast, nor infinitely well-informed, despite what economists, corporate strategists, and other market-thinkers like to presume for simplicities sake. Moreover, the problems that face us are sometimes too urgent, or the consequence of failure to great, to allow the market to naturally weed out the bad solutions and adequately increase the chances that good solutions flourish (Beresford’s Chapter 20 on South African entrepreneurs deals with precisely this issue).

Think of a case where we let companies compete freely for the distribution of emergency care. Some of these companies are good players; they deliver on their promises and will be rehired. Some will be bad or inefficient players and ought to perish once we see how they perform. However, if we solely use market feedback to determine whom to trust and how to organize, then we also accept that in order to weed out the bad players, we need to allow all those served by them to die when their first aid fails to arrive.

Markets do indeed work somewhat like evolution. Only evolution doesn’t work the way market thinkers suppose; it doesn’t actively and directly select the fittest, rather it simply selects those who accidentally happened to survive in some given context. This means that after repeated cycles those species or solutions which are better aligned with the environment (which is always changing) or problem at hand have greater odds of still being around. However, neither the market nor evolution provides any guarantee that the best species or solutions haven’t perished due to a random incident, a fate that active intervention might have saved them from. Nor is there any guarantee, nor even reason to think, that the market or evolution kills off excruciatingly ill-fitted specimens with any great haste.

Hence, very often we can by deliberate and active intervention pursue solutions that are better than those which accidentally happen to survive at the free market. We can also often sort out the poor solutions right from the get-go, rather than waiting for an extended series of failures to make the market sort this out. We are often in an epistemically superior position, where human deliberation can more quickly identify a better solution to our problems than what the free play of market forces would have provided. Sometimes, it is indeed tough to figure out how to approach a problem, and in those cases reliance on market forces might be of assistance, but that is an empirical question, different for every individual problem we face. Moreover, the burden of proof is surely on those who claim that a repeated game of odds for survival on the blind market is epistemically a better approach than conscious human deliberation about how to proceed. The market imperialism of neo-liberalism cannot be defended on the grounds that it is always epistemically superior compared to deliberate and targeted intervention. For it is quite clear that we are neither as dumb, nor the market as smart, as that would require.

2.2.6 A Final Neoliberal Rejoinder

After such a battering of philosophical argumentation against the universalist pretensions of market imperialism, a typical retreat strategy might seem tempting to the staunch neoliberalist; at least it has been the recourse of all those neoliberals with whom we have discussed these things. The defense goes something like this:

To that reply we say two things: First, the rest of this book does nothing but get into real life, examine real cases, and these cases display how a neoliberal market solution often does more damage than good and is by no means the best way of problem-solving. Second, if that really is your position then recall that when you go into the world to solve problems and analyze situations then you can never justify a market approach until you have seriously considered what other options are available. This eagerness to proclaim the down-to-earth practical and case-by-case nature of one’s neoliberalism comes with the cost that, in order to justify a market solution, one must just as eagerly have scouted far and wide to see if there were better solutions available. The alternative is to claim that one, on principled grounds, know that market solutions will be the best way to approach a given problem, but such principled grounds required a theoretical defense of market imperialism. And as we have just shown, the theoretical arguments that are traditionally used in favor of market imperialism do not hold up to critical scrutiny.