THE THINKERS who invented the idea of capitalism, like Adam Smith, famously imagined that a free market was like a machine that would run by itself and would benefit everyone, at least in the long run. They also believed that interference by the government would only make the machine malfunction. That’s why, even though there was plenty of food available during the Irish Famine of the 1840s, the British Crown took no measures to distribute that food to the starving, with consequences that even the most history-deprived will probably have some inkling of. In economics, this doctrine was called laissez-faire or liberalism.
As a political rather than an economic theory, liberalism was and is a different animal. Individual freedom is also a core value for political liberals, but some of them favor the sort of government action to protect the disadvantaged that economic liberals define themselves against. This has always been confusing. The confusion deepened when people started talking about neoliberalism, a term that came out of nowhere, skyrocketed to stardom in the 1990s, and is now one of the more widespread labels of the system we live under. To what does neoliberalism refer: economic liberalism or political liberalism? Or is it a unique mixture of both? To put this another way: if neoliberalism is now the name of the game, where does power really lie in our society? Does politics still matter, or is it the economy that’s calling the shots and running the show? Coming up with new answers to these not uninteresting questions is the point of an erudite and provocative new book by the French philosopher-sociologist team Pierre Dardot and Christian Laval, The New Way of the World: On Neoliberal Society.
Neoliberalism is usually taken to mean the re-inventing of liberalism, an event that mainly happened in the 1970s and 1980s. Dardot and Laval reject the idea of a re-invention; they think the new version is significantly different from the old. But their story only makes sense if we first recall when and why the old economic liberalism fell out of favor. That happened in the 1930s. The prolonged, world-wide, almost unimaginable suffering caused by the Great Depression exposed faith in the free market as just that — a kind of faith, unwilling to listen to reasoned evidence that maybe things weren’t working out according to the divine plan. Belief that conditions would improve in a hypothetical economic afterlife seemed unsatisfying in the face of actual children sent to the cafeteria and given nothing to eat. Thus subsidized school lunches were eventually legislated into being (in 1946) along with other government programs to equalize economic opportunity and rein in the uninhibited pursuit of profit. Economic liberals were shamed into relative silence. And, for some decades at least, social inequality in the United States was somewhat alleviated. But the “stagflation” of the late seventies, combined with the oil crisis, led to widespread economic unease. In 1980 Ronald Reagan was elected president, the budget for the Federal School Lunch Program was cut by 25%, and it was famously decreed that ketchup would henceforth count as a vegetable. Neoliberalism, which had been quietly incubating in free-market think tanks here and in Europe, was launched on what would prove to be a spectacular career.
There’s a familiar list of measures that created an environment friendly to big business, as the saying goes, and extremely unfriendly to the poor, and Dardot and Laval do not dispute them: the privatizing of public services like welfare and education, the de-funding and dismantling of government agencies charged with protecting consumers, the de-regulation of the financial sector, and so on. The received wisdom at which they take aim is that neoliberalism represents capitalism’s undermining of the state. In their view, what looked like an all-out assault on big government by corporate interests was actually a process in which government itself was not just complicit, but an active partner. Neoliberalism is not a case of global capital having a tantrum and getting its way, as almost everyone left of the Tea Party has assumed. The true culprit and string-puller is a somewhat mysterious entity that Dardot and Laval call, following Michel Foucault, “governmentality.”
In the late 1970s, Foucault gave a series of lectures on liberalism and neoliberalism that were published posthumously (he died in 1984) as The Birth of Biopolitics. Dardot and Laval pay homage to Foucault’s prophetic powers and set themselves the task of expanding and fleshing out his sometimes sketchy or enigmatic argument. The French title of their extremely well-received book, “La nouvelle raison du monde,” refers not to a new way of the world but a new reason or rationality, a rationality that is also a new mode of governance. Still, “way of the world” is not a bad translation, since what they mean when they borrow Foucaultian terms like governmentality and governmental rationality can also be expressed as biopolitics, a term they understand to describe a compulsive interest in colonizing and controlling more and more intimate aspects of life itself — reproduction, the erotic, daily self-discipline, sociability, and so on. That is, biopolitics is held to work not by forbidding or repressing older ways of living, but by producing for us seductively new ways. We are controlled by what we ourselves choose.
Dardot and Laval’s deployment of Foucault reminds me of why I’ve always been suspicious of his work: the premise that what we are ruled by (not an entity, but a mode of being that interpenetrates everything, including us) is more sovereign than any mere political sovereignty, yet like the most totalitarian regime, obsessively seeks total knowledge and total control. This premise seems more than a little paranoid, even in the era of Edward Snowden’s revelations about the NSA. But it does lead Dardot and Laval in some interesting directions. In the book’s final chapters, after discussing the intellectual origins of neoliberalism in Germany and the United States, they argue that government bureaucracy has adopted from the business world managerial principles like outcome indicators and market incentives, entrepreneurial flexibility (at the expense of principle and long-term policy) and ruthless, unending competition between people and units (at the expense of common goals). As a result of what is billed as “reform” and “rationalization,” the state is thus increasingly “an enterprise in the service of enterprises.”
More important — indeed, this is the real point of the book — neoliberalism has produced a new kind of person, or as the Continental philosophers say, a new kind of subject, a subject spanning both the public and the private sectors: “Neo-liberal man is competitive man, wholly immersed in global competition.” And further: “We have not emerged from the ‘iron cage’ of the capitalist economy to which Weber referred. Rather, in some respects it would have to be said that everyone is enjoined to construct their own individual little ‘iron cage.’” Our desires have been redirected, the book tells us; our very souls have been transformed. For Dardot and Laval, this concept that Foucault describes as characteristic of modernity has, in the era of neoliberalism, taken an increasingly economic cast: now we are all expected to be entrepreneurs of ourselves, always pushing ourselves to perform at a higher level, always seeking new investment opportunities, even risky ones, in order best to exploit our personal resources and obtain maximum personal profit.
And we respond. Whatever the harm done to ourselves, to the institutions we work for, and to the common good, we sort of like it. Otherwise the trick wouldn’t work. That’s Foucault’s signature analysis. It may not fully explain why neoliberalism was too well anchored in social reality to have been overthrown by the financial crisis of 2008 — a question for anyone following recent critiques of neoliberalism — but at least it’s an attempt to answer the right question.
Like Foucault, Dardot and Laval insist that while the old liberalism of the 18th and 19th centuries took the free market as the natural condition of humankind, the new liberalism recognized that it was not natural at all. On the contrary, it would have to be constructed and then made to seem natural. And in order to construct a global marketplace where everyone would compete freely and ceaselessly with everyone else without question or complaint, the neoliberals would need the help of the state. At any rate, this was the conclusion drawn by the so-called ordoliberals, a gathering of post-war German economists whom Dardot and Laval distinguish, again following Foucault, from the Chicago School of free marketeers, who have gotten a great deal more credit or blame. This historical reliance on the support of the state explains why neoliberalism was political and not merely economic from the get-go, and also (so Dardot and Laval argue) why a left-wing politics that tries to defend the state against capital would be fundamentally misguided. The neoliberal state is always already on capital’s side. The question then is: is the Marxist-informed economic left wrong to try to use the government to push back against inequity? Is agitating for a reversal of the policies begun under Reagan a way to resist capital, or is doing so at best a waste of time, at worst a serious ideological error that confirms the status quo?
The argument is well worth having. To many of its founders, as they show, the idea behind European unity was not to protect against the corrosive effects of national competition but, on the contrary, to protect competition itself and to install it where it didn’t yet exist. It would be naive in the extreme, they argue, to imagine that a “Europe” so constructed might serve as a bulwark against unfettered globalization. When the governments bailed out the banks during the recent (and ongoing) crisis and saved the financial system at considerable cost to the taxpayers, they were not stepping out of character. For Dardot and Laval, therefore, the crisis was not wasted, as some would have it. There had never been any possibility that government might subordinate the financial system to the good of the people. The state can’t be said to have failed at something it never would have attempted.
By filling in the details of neoliberalism’s intellectual history, including its tentative theoretical beginnings and its internal divisions, Dardot and Laval claim to be making its recent triumphs seem more groping, uncertain, and contingent. But the book’s effect is exactly the opposite. Merging Foucault with Max Weber, they make neoliberalism seem the inevitable result of an implacable “rationalization of existence” (11). But considering these two thinkers together makes their account seem less persuasive than Weber’s. For Weber, to put this a bit crudely, rationalization was not just what capitalism wanted, it was also what the population at large came to want, and (as against Foucault’s interpretation) for rational or understandable reasons. Who would say no to fairness in the application of universal rules, to protection from the arbitrary whims of leaders, to the material benefits of the mastery of nature? For Dardot and Laval, on the other hand, it’s unclear what it is that foists rationalization on us, what interests are served by it. Arguing rather passionately against Marxist common sense, they insist that the motive doesn’t come from capitalism. But in that case, where can it come from? Who or what motivates all the obsessive scrutiny and pressure to conform that they think the system requires? Why should we believe that there exists a shadowy monster called governmentality that wants or needs these things and that, as they hint, must be even bigger and stronger than capitalism, though much harder to get a mug shot of?
If all Dardot and Laval wanted to propose was how complicit states have been in de-regulating and defending the financial sector, that would be fine. But they want to argue that the original impulse to de-regulate came from the state, or as much from the state as from the banks. That’s a stretch, and when they make it, their Foucaultian undies start to show in an unattractive way. You can understand why capital would want to colonize the state. The state was limiting its profits and threatening its freedom of action. It’s harder to understand what interests are served by a god-like governmentality that is supposed to float mysteriously over or behind or through every aspect of social existence. The paradox of a strategy without a strategist is not beyond our powers of imagination; we can conceive of a lightning bolt without Zeus. It’s just that as an explanation for the dismantling of the welfare state, this account seems less plausible than the obvious alternative.
Do the activities of ordinary citizens threaten governmentality (whatever it is) in the way that Dodd-Frank, say, would have threatened the financial sector if lobbyists for the banks had not thrown enough money at it to render it toothless? I don’t see it. It would be different if debtors were refusing to pay off their student loans or credit cards. In order to make their case, the authors would have to show that citizens are being unruly enough to need governing in the strong sense of governing they are talking about — control over every intimate detail of life. But what sort of unruliness can they point to? Is society having a collective heart attack because of marriage between people of different races or the same gender, because women are having too many babies or too few, because of excessive cell phone use? No, and no, the fact that they aren’t is not proof that neoliberalism a la Dardot and Laval is working. Yes, young black men are disproportionately followed and arrested and incarcerated. Yes, an executive branch unused to being scrutinized itself has gotten into the habit of indulging in extravagant and illegal scrutiny of others. Yes, corporations (not the government this time) are seeking to profit by monitoring our every mouse click. But Dardot and Laval should be reassured. They do not inhabit a nightmarish totalitarian society where anyone writing a Foucaultian essay on neoliberalism risks serious jail time. All those who toss and turn over the steady creep of biopolitics should take a deep breath and recognize, for better or worse, how wide the field is for people to do things about which the Powers That Be don’t give a shit about one way or the other, the publication of this book included.
The New Way of the World thinks it has named the one figure who can stand for the neoliberal era: the competitive, risk-seeking entrepreneur. Branding an epoch is quite a grand gesture. It offers the kind of headline that grabs people’s attention. The editors of this journal would no doubt have been happier with the present essay if I had been able to call it something like “The Rise of the Risk-Taker.” But how often does this sort of rise and this sort of exemplification really happen? Sure, you think, the entrepreneurial self! It seems plausible enough until you begin to consider other possible candidates for Character of Our Times — old favorites like the narcissist, the slacker, and the hipster, or even older ones like the work ethic’s gratification-delaying ascetic and its opposite number, consumerism’s let-it-all-hang-out hedonist. According to Serge Audier, whose own recent book on neoliberalism has not yet been translated, it was the capitalist subject as consumer that Foucault was pointedly looking away from in his now 30-year old lectures; too many other thinkers, especially on the Left, had been getting publicity by talking about consumerism. Foucault needed something different ... Indeed, if one were looking for a single character type to represent capitalism, the consumer applies to a lot more people than the entrepreneur. But why go with any one type when the real story (in my own view) is the impossibly contradictory impulses for which the system challenges us to find room in our hearts and our days?
Some decades back, Daniel Bell underlined the contradiction within capitalism between the asceticism of the work ethic and the hedonism of the consumer ethic. With the briefest of nods to Bell, Dardot and Laval propose that the competitive entrepreneur is … a synthesis between the two. That would make it the obvious winner in the brand-our-era competition. Or would it? Any high-end gym in LA or NY would no doubt offer a range of dedicated long-distance shoppers who are also fanatics of self-discipline, self-denial, and self-investment. But these fashionably-clothed, high-performance bodies will not do much to explain why so many millions of Indians just voted for the Hindu nationalists. That had more to do with how the economic system has tantalized the masses with dreams of a glossy abundance that it also keeps them from realizing. Foucault and his followers have always gotten points for registering non-economic injustices that do not appear on Marxist radar. But sometimes their need to insist that “it’s not the economy, stupid” seems, well, stupid.
There is nothing stupid about the book’s concluding proposal, that we try to think of others as well as ourselves, and that we try to do so in a cooperative rather than a competitive way. Don’t be competitive! Think lovelier thoughts! Yes, always a good idea. Unfortunately, this very soft politics is all Dardot and Laval are left with once they give up on regulating the banks and otherwise defending and extending those state institutions that capital has undermined and continues to undermine. For them, the fact that corporate interests have worked so hard to delegitimate and emasculate these institutions is irrelevant. “The neo-liberal state is therefore not a ‘tool’ that can be equally put to contrary purposes. As a ‘strategist-state‘ jointly deciding investments and norms, it is part of the machine that has to be fought.” Agencies devoted to education, welfare, detecting financial malfeasance, guaranteeing the purity of air and water, and so on should be put in the same ethico-political category as agencies devoted to snooping on private citizens or clearing a path for the financial sector to gamble away our savings and pensions. This seems a bit blunt.
Dardot and Laval cite the American political theorist Wendy Brown, who supports their political stand with a clever psychological argument. In the neoliberal era, Brown says, the Left will be tempted to mourn for those state institutions that capital has destroyed. Mourning, as Freud said, involves idealizing the lost object. We should remember, Brown warns, that we never truly loved these institutions in the first place. Liberal democracy was and is unworthy of our love. The answer to this is that love is not the issue. You don’t have to love school lunches or scrutiny of the financial sector or environmental protection to agree that most of us are better off having these things, and having them funded.