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https://www.youtube.com/watch?v=8jMBRAfpt3U
Peter Kopa, Prague 7.6.2021
In view of the great actuality of Neoliberalism, we offer some reflections on the article by Rainer Hank (appeared on 5.6.2021 in German in the Neue Zuercher Zeitung, Zuerich) who was editor-in-chief for economics and finance of the “Frankfurter Allgemeine Sonntagszeitung” until the summer of 2018. He lives as a journalist in Frankfurt.
Introduction: the economic question in itself
The big question of how to understand, regulate and control economic activity from the modern state is the reflexive domain of a whole series of political and economic schools, which have been put to the test in the West (Europe and USA) in the last two hundred years. This arc of approaches ranges from the Marxist-socialist extreme to liberal individualist capitalism. When these intellectual constructions have been accepted by ideologies of concrete action, they have always been perverted as mere instruments to reach the maximum good of peace and social justice, which supposes the production and distribution of goods equitably.
Thus, for well-known historical reasons, this dream turned into tragedy in communism, in Nazism and in the various forms of extreme socialism, to the extent that the freedom and initiative of the citizen has been stifled. On the other hand, in political and economic systems based on freedom and the natural laws of economics, they have produced an unexpected abundance of state and personal prosperity. Examples: the German economic miracle of Ludwig Erhard and Konrad Adenauer, the economy according to the American model in Chile after Pinochet, the European and American open economy and its happy copy throughout Asia, managing to lift more than a billion people out of extreme poverty in the last thirty years, not to mention China, which has also been able to copy this model without openly admitting it.
The individual is the main protagonist of economic production, because it is he who has had the geniality of an Edison, a Steve Jobs and so many others who through their inventions and discoveries have managed to increase the productivity of human labor by a factor of thousands of percent, which grows day by day, and with it have established profound social processes with immediate economic and political repercussions. One of thousands of examples in this sense is the invention of the motor power (steam or fuel explosion) which is at the basis of the industrialism that began at the beginning of the 19th century. And we cannot forget here the sciences and techniques of rationalization, electronic computing and artificial intelligence. The bad thing about Marxism, still diluted in various forms of extreme socialism, is that it is the State that has to do everything in the sense that the citizen is not free to invent anything, nor to think freely. The result is not only the paralysis of all authentic progress, but the regression in welfare, the confiscation of private property, etc. El dinero físico, garante de libertad
Neoliberalism, the great scapegoat
At the opposite extreme to Marxism are the schools of thought that value the free human individual in an open economic market, self-regulated by free competition, under the surveillance of the State. Its function is not to allow competition to be abused by stronger economic actors. But even so, these economic systems, which we can place under the conceptual heading of capitalism, have given rise to understandable criticisms, such as not wanting to pay taxes, manifesting a selfish economic protagonism, not wanting to care for the poor, lacking solidarity and understanding, affirming that selfishness is good because it strongly encourages personal and entrepreneurial endeavor.
For these reasons, there is a prevailing conviction in Western intellectual circles that neoliberalism needs to be rethought. In fact, this critical attitude has been increasingly evident since 1980, but so far it has not been possible or there are no better economic systems. In the background, the great economic achievements of capitalism, which is like the backbone of neoliberalism, which has allowed a material prosperity never seen before in the West, and, at the same time, this economic model has been gradually embraced all over the world, since the end of the last world war. (¿Es el Capitalismo tan malo? )
Triumph and tragedy of neoliberalism
Rainer Hanke rightly quotes Harold James, an economic historian who teaches at Princeton University, who has shown in a brilliant essay in the journal ‘Capitalism’ (Spring 2020) to what extent neoliberalism must be understood as a response to the wave of de-globalization that followed the Great Depression. The aim of these top intellectuals (among them Ludwig von Mises, Friedrich August von Hayek, Raymond Aron and Wilhelm Röpke) was to design open and dynamic, yet no less civilized, markets for a world threatened by growing nationalism and radical populist currents.
The failed history of the ideas of neoliberalism is a tragedy that, since their elaboration, they have not succeeded in getting leftists and conservatives to accept them as a fair economic model. Harvard economist Alberto Alesina, who sadly passed away at a young age, tirelessly promoted the idea that “the left must learn to love liberalism” because it is not only efficient but also socially just to fight against the chicanery of privilege and protectionism in day-to-day concrete economic policy. Neoliberalism with its open markets, its primacy of competition, within a state regulatory framework, continues to ensure the prosperity of nations better than any state interventionism. China since the 1980s is the best example. But who would dare praise China for its neoliberal turn? At best, neoliberalism can succeed incognito.
