The failure of neoliberalism is being grossly overstated
Martin Jacques, modern Marxist par excellance, is simply screaming with joy at the idea that neoliberalism has failed. We fear that the catalogue of said failure is being really rather misunderstood. His contention is that poverty and inequality have increased as a result of all this global free marketry. We would insist that this is not quite so.
But how did neoliberalism manage to survive virtually unscathed for so long? Although it failed the test of the real world, bequeathing the worst economic disaster for seven decades, politically and intellectually it remained the only show in town.
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They go to the heart of the neoliberal project that dates from the late 70s and the political rise of Reagan and Thatcher, and embraced at its core the idea of a global free market in goods, services and capital.
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It should be noted that, by historical standards, the neoliberal era has not had a particularly good track record.
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But by far the most disastrous feature of the neoliberal period has been the huge growth in inequality.
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The reasons are not difficult to explain. The hyper-globalisation era has been systematically stacked in favour of capital against labour:
It's not really necessary to read the rest of it to find out how it goes on. Any competent programmer can turn out a script to produce this stuff to any length in an hour or two.
But we do really insist that it is necessary to fact check such claims against the universe we live in rather than that phantastical one which lives in the heads of ivory tower Marxists. And the most notable economic fact of all history was that Industrial Revolution. The one which heralded an economic system which, for the very first time, produced a sustained, significant, rise in the living standard of the average person. The most notable economic fact of the past few decades has been this:
WASHINGTON, October 4, 2015 – The number of people living in extreme poverty around the world is likely to fall to under 10 percent of the global population in 2015, according to World Bank projections released today, giving fresh evidence that a quarter-century-long sustained reduction in poverty is moving the world closer to the historic goal of ending poverty by 2030.
The Bank uses an updated international poverty line of US $1.90 a day, which incorporates new information on differences in the cost of living across countries (the PPP exchange rates). The new line preserves the real purchasing power of the previous line (of $1.25 a day in 2005 prices) in the world’s poorest countries. Using this new line (as well as new country-level data on living standards), the World Bank projects that global poverty will have fallen from 902 million people or 12.8 per cent of the global population in 2012 to 702 million people, or 9.6 per cent of the global population, this year.
That percentage was more like 95% of the global population in 1700, in 1960 still 50%, in 1990 35%. We have extended that roughly free market, roughly capitalist, economic method, the one that made us and our forbears rich, to rather more of the globe. That's what this free market globalisation actually is and was. And just as it made us rich it's making near everyone else rich too.
Neoliberal globalisation has led to a fall in global inequality, it's the most pro-poor economic policy ever adopted and it has led to the greatest fall in absolute poverty ever in the history of our species. We'll take that as a win for neoliberal globalisation ourselves.
A win that we really think we shouldn't abandon at the insistence of ivory tower Marxists nor anyone else. After all, what is the basic claim being made? That the poor should get rich? Isn't that exactly the result which is being delivered?