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real-world economics review, issue no. 94 subscribe for free

Neoliberalism must die because it does not serve humanity Nikolaos Karagiannis [Winston-Salem State University, North Carolina, USA]

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This short article on neoliberalism comprises three brief sections which discuss key theoretical notions, general practical issues, and worldwide experiences respectively while offering a facts-based assessment. Brief concluding remarks end the article.

Theory Neoliberalism gained momentum in the 1980s and became distinct and recognizable as an 1 ideology by the 1990s as the “Washington Consensus”. Neoliberal theorists would suggest that their theories are universal in nature and that assumptions that underpin them are unimportant. This can only be true when the assumptions truly do not matter because they are compatible with all possible socio-cultural and institutional matrices. Neoliberalism seeks unrestrained accumulation of capital through a rollback of the state, and limits its functions to minimal security and maintenance of law, fiscal and monetary discipline, flexible labour markets, and liberalization of trade and capital flows. Neoliberalism stands in contrast to classical liberalism in that it views the market system as a goal in itself as opposed to being something that is a means to the goals of higher economic growth and higher standards of living. Neoliberalism came to public attention in the early 1980s, starting with Margaret Thatcher in the United Kingdom and Ronald Reagan in the United States, and the minimalist state belief entered the political lexicon. It was during that period that witnessed the ascendancy of Thatcherism and Reaganomics. Both Thatcher and Reagan shared a common vision: to remake their societies through a retreat of the big government and allow the private sector to come into its own. Domestically, it consisted of “supply-side policies”, such as deregulation, privatization, and massive reductions in tax rates, in order to spur growth. Internationally, it meant the negotiation of free trade agreements and subsequent rounds of multilateral tariff 2 reductions as well as harmonization of policies across countries. New Zealand, Australia, and Canada also adopted similar policies, as did much of Western Europe. 

Nikolaos Karagiannis is full professor of Economics at Winston-Salem State University, North Carolina; visiting professor at the University of Cambridge, England; and the co-editor of American Review of Political Economy. He has published extensively in the areas of economic development, public sector economics, and macroeconomic policy analysis. Professor Karagiannis is particularly interested in developmental state theory and policy, and his research has focused on the applicability of this perspective in different contexts such as in EU countries, the United States, Caribbean small island economies, North African countries, and China. He is the author, co-author and co-editor of twenty two books and has published around 150 papers as refereed journal articles, books chapters and op-ed. 1 Williamson, J. (ed.) (1989). Latin American Readjustment: How Much has Happened, Washington: Peterson Institute for International Economics, November. 2 Karagiannis, N. and Z. Madjd-Sadjadi (2013) “Why is Neoliberalism Dangerous? Criticism, Alternative Perspectives, and Government Policy Implications”, pp. 11-31 in The US Economy and Neoliberalism: Alternative Strategies and Policies, edited by N. Karagiannis, Z. Madjd-Sadjadi and S. Sen, London & New York: Routledge (Advances in Heterodox Economics), March.