Neoliberalism refuses any social or ecological limitation and has all the attributes of a dogmatic religion. For neoliberalism, there is only an ethic of individuals, not a social ethic that judges according to a standard of social justice. It is convinced that interventionism is of the devil and that the good can only occur in the form of the market and never in the form of social justice.
“THE IDOL MARKET”
OR TEN DOGMAS OF NEOLIBERALISM
By Willy Spieler
[This article by the editor of the Swiss “Neue Wege” is translated from the German in: Neue Wege 93, July/Aug 1999.]
Once “neoliberalism” was not identified with the pure market ideology. The “social market economy” was initially included in this term. What appears today as “neoliberal” outlaws the term social. Only a “market economy without adjective” is sought!
The ideology of a pure market economy goes back to Friedrich August von Hayek (1899-1992) who as a professor of economics was even honored with the Nobel Prize for economics. His best known book “The Way to Serfdom” appeared in 1944 in England and was dedicated to “socialists in all parties.” This dedication was directed to middle class representatives of a social market economy intent on social balance.
This ideology of a “pure” market economy unconcerned about social or ecological criteria is made absolute. No other authority is endured beside or over itself. As a result, it becomes an idol like everything finite that absolutizes itself, whether called state, nation, party or church. “The Idol Market” is also the title of a liberation theology book by Franz J. Hinkelammert and Hugo Assmann. Idols have their own magic and fascination. They are overthrown when their absurd exhibitionism is unmasked. This essay seeks to contribute to that unmasking.
Neoliberalism refuses any social or ecological limitation or qualification and has all the attributes of a dogmatic religion. Without claiming completeness, its dogmas are 1. The more the market develops unrestrained, the more it leads the economy to the good. 2. There is no alternative to the global and total market. 3. The market is our fate. 4. This fate demands sacrifice for a better future. 5. The laws of the market are valid absolutely. 6. If the market is in conflict with democracy, the market can demand democracy’s abolition. 7. No social ethic can set limits to the market. 8. There is also no business ethic since the only social responsibility of a business consists in increasing profits. 9. The highest criterion of the market is its efficiency. 10. Efficiency presupposes business decisions only oriented in the logic of the market that enforces this logic with the necessary severity.
1. The more unrestrained and free is the market, the more it leads the economy to the good
For neoliberalism, the market economy is a spontaneous order arising by itself by itself according to the mechanism of supply and demand. Assets are exchangeable for other assets, products for money and labor for wages. The suppliers are in competition with each other which produces the best and most reasonable goods and services for as many people as possible. In this idealized characterization, the market always produces social balance. No social market economy is necessary since the market economy always turns out to be social.
According to the neoliberal interpretation, the market can only fulfill its social function when it is free from state bonds. The function of the state is to advance de-regulation in economic and social policy, in other words to become an “anti-state.” The more freely economic subjects pursue their own interest on the market, the more they serve the goal of the economy, providing people with goods and services.
That the market constantly coordinates individual self-interests into the well-being of the whole is a dogma, not an empirically verifiable statement today. Adam Smith (1723-1790), the founder of “classical” economic liberalism, believed in an “invisible hand” that brings all interests of economic subjects into a constantly new balance. Following the bee fable of the English philosopher and contemporary Bernard de Mandeville (d. 1773), a community thrives best when its members strive for nothing but the realization of their interests which can be selfish interests. The “invisible hand” even molds these egoisms into the welfare of the whole. Private vices become public good deeds. “Private vices equal public benefits.”
The following sentence hurled by a German economics professor Hermann Sauter against his leftist rival Ulrich Duchrow (in: Okumenische Rundschau January 1995) shows that the blind trust in the “invisible hand” rises from the ashes or rears its ugly head again. “The market is concerned objectively for solidarity even if individuals do not see this.” Thus solidarity does not rest on ethics but is produced by itself, quasi-sacramentally (ex opera operato) through the market. Sauter is a member of the board for church development service of the Evangelical church in Germany.
2. There is no alternative to the global and total market
Neoliberalism presents itself as an ideology without alternative. As every dogma is exclusive, the dogma of the pure market economy also raises a claim to exclusivity. Outside the market there is no salvation! Many of our “economic leaders” as they describe themselves also defend this dogma of a market economy. The merger of Novaris and UBS is an example. The marriage of the two Basel chemical giants on March 7, 1996 was not necessary since Ciba and Sandoz set record profits the previous year. The president of the Novaris governing board Alex Kramer justified the merger with the pithy words: “Being good is not good enough. Only the best takes everything…” “Only the best” is the goal; the others are consecrated to destruction. The market economy without adjective is also a market economy without alternative.
In zealous obedience toward the demands of the world market, the fusionists of Novaris and UBS chose the “right moment” for their project in order not to be “forced” later to a merger out of weakness. The economics editor of the “Neue Zurich Zeitung” (NZZ), Gerhard Schwarz, summarized “no firm can evade the dictation of worldwide competition unpunished in the long run” (March 9/10, 1996).
What is true for the freedom of the market was also true in days of yore for freedom in dialectical materialism. Dialectical materialism confined itself to “insight in necessity.” The market is a coercive mechanism. Whoever refuses does this at the price of economic downfall. As Mr. Schwarz formulated, “Whoever wants to be competitive must consistently join in. Otherwise the market quickly shows him the red card.” “There is no alternative from a total social perspective, the vantage point of the public interest.”
“The Man without Alternative” was the title of a book by the young Polish Marxist Leszek Kolakowski widely discussed in the 1960s. He leveled powerful criticism as a Marxist scholasticism that also allowed no alternative since it claimed to be the absolute truth about the course of history and a kind of end time promise. In a famous essay, Pierre Bourdieu pointed to the parallels between modern neoliberalism and vulgar Marxist determinations of the past. The French sociologist was surprised about the “new faith in historical inevitability grounded on the primacy of productive forces (and technology), a new form of economism that at other times and in the ranks of the same believers spread under the banner of Marxism” (Tages-Anzeiger, No.6, 1996). The parallels are striking.
3. The market is our fate
The market is our fate; neoliberalism is a religion of fate. Novaris president Kramer described the demolition of 10,000 jobs as “regrettable but unavoidable in the interest of the future.” Staff reductions are only unavoidable because the capital profit had to rise 20 percent. The fusionists deny they only consider shareholder interests and accept even more unemployment in return. In the Sonntags Zeitung (March 17, 1996), the Novaris president said: “This argument comes from the last century. A conflict of goals between capital and labor is constructed. This is no longer in keeping with the times. Global competition occurs today on one side between locations and on the other side between communities of fate. The Basel region as a location is a community of fate.”
The “community of fate” with its “esteemed co-workers” also belongs to the fate religion of corporate functionaries. However this is not a community of equals. The extolled “shareholder democracy” only exists on paper. Fate religion creates its own hierarchies.
The workers have nothing to say. The social-ethical priority of labor leftist capital is turned upside down. Profit maximization is more important than the preservation or creation of jobs. Businesses are property objects that capital can control as it likes, merging, selling or exploiting according to the style of raiders. There is no evidence of “association of persons” with vested rights of co-determination as the social ethic of Christian churches envisions. Such structures were not agreeable to capital but were almost a positional disadvantage on the world market. Its fatefulness allows no space for social-ethical “idealism.”
4. The market demands sacrifice for a better future
People must suffer under the laws of the free market. For neoliberalism, they have to make this sacrifice for the sake of the freedom of the market which promises a brilliant future to humanity as a whole, if not to them as individuals.
That jobs “must” be destroyed to be preserved is part of this sacrifice religion. Sacrifice is proclaimed to them in a language reminiscent of George Orwell. If it is bad for you today, it is only so you can survive t6omorrow. You are handed over to shareholder interests come what may. When these are satisfied even at your expense, you have a future. But be comforted, this future will bring work and prosperity to everyone. The “dictation of worldwide competition” causes conflicts and hardships to largely dissolve on the aggregate social plane and in the long term,” the NZZ comforts us. Novaris head Vasella, a former surgeon, formulated this in a somewhat less reserved way. To the “Financial Times,” he said: “Job reduction is like a surgical operation. You know it hurts but it is in your best interest. To cut slowly and not deep enough is the worst.”
These rationalizations never end. They justify the dismissals of tomorrow, not only the dismissals of today. “What is true for tomorrow is also true for the day after tomorrow,” the social ethicist Peter Ulrich objected (TA, Dec 29, 1996). The prognosis that one-fifth of the world population able to work can keep the whole world economy going is already widespread. What will happen with the remaining 80 percent? What befell “command socialism” will also befall capitalism. The good end of history suffers under “parousia delay.” The promise of a bright future will never be honored and the sacrifices will become greater and more senseless.
5. The laws of the market are valid absolutely
Neoliberalism is defined by belief in an absolute authority of the laws of the naturally growing “total” and “global market” left to itself. When the rich become richer and richer and the poor become poorer and poorer, the market cannot be responsible, only the state which hinders the market with too many regulations. Since a self-healing power starts from market forces, there can never be a market failure, only a state failure. This is obviously a circular argument but this deficient logic does not worry the priests of the free market economy and exorcists of all state interventionism. Allowing the “visible hand” of the state to intervene against the “invisible hand” of the market would be a lack of humility.
The liberal German politician Otto Graf Lambsdorff writes in the NZZ (Oct 29, 1995) the prohibition of child labor in the third world would have “catastrophic consequences,” not child labor itself. “Such a prohibition would mean hunger, child prostitution and distress.” This is similarly true for ecology. Only “free trade” can create prosperity since it enables people to have a sufficient environmental consciousness. Conversely, does this environmental consciousness result from the damages inflicted on the environment by deregulated free trade?
Neoliberalism shows all the characteristics of a fundamentalist religion. It does not fall back on the “absolute truths” of a “revelation” but on the “worldly” laws of the market for which it claims absolute obligation. Therefore liberation theologians like Hugo Assmann and Franz J. Hinkelammert speak of a “powerful process of idolatry” and “its conspicuous expression in the supposed self-regulation of the mechanisms of the market.”
On every dollar, we read “mammon” guides the “invisible hand.” Besides money, the “fetishism of goods” analyzed by Marx is rated positively by a new perverse “sales culture.” The prophetesses and prophets of advertising no longer praise goods but sacraments. The products offered for sale need not correspond to genuine needs but satisfy the insatiable longings of customers. “Advertising assumes the function of evangelization and the proclamation of the Good News of salvation,” writes Leonardo Boff.
The Gottfried Duttweiler Institute, an institute studying trends, held a meeting in June 1994 on the marvelous mutation of goods into “cult products.” In the invitation prospectus, the question was raised: “How do sacred products arise?” “Cult marketing” and “spiritual selling” are the new marketing trends. A “religious affection” for products must be awakened against the “moralization of consumption and demonization of pleasure.” “Consumer rituals” and “tribal membership of the `like-minded’ define shopping today, not simply experiences or prices. “The spiritualization of markets and the creation of cult products occur along with a revaluation of brand-name articles into fetishes.” Advertising today has the function of providing an “explanation of the world” “through strong metaphors.” “The goods themselves become the strongest of all religions,” declared a satisfied GDI representative after the meeting (TA, June 18, 1994).
6. If the market is in conflict with democracy, the market is entitled to abolish democracy.
“The economy was never a democratic process,” the Novaris head and former Trotskyite Vasella said (Weltwoche, March 19, 1999). This is a problem of politics, not only of the economy. The more an undemocratic economy is deregulated, the more powerful it becomes and the more it begins to regulate politics. This is shows in the manner and way that the economy forces policies to a murderous (suicidal) struggle for location advantage. The goal of politics is what keeps happy the large investors and taxpayers, not what public interest requires.
Contempt for democracy has an ideological explanation in neoliberalism. As every fundamentalism is anti-democratic since absolute truths avoid democratic decision, the “fundamentalism of the market” is anti-democratic. In the case of conflict, the market claims precedence over democracy. If democracy no longer serves or offers sacrifice to the market, then dictatorship is justified.
Several years ago the NZZ described Chile’s military dictatorship under general Pinochet as an “economic model” (Jan 11/12, 1992). Economics editor Gerhard Schwarz bid farewell to the “convenient” thesis that “market economy and democracy belong together like twins.” He referred to examples like Hong Kong, Singapore, South Korea, Taiwan and especially Chile where “brutal dictatorship led to the market economy and growth.” Mr. Schwarz also recommended this brutal dictatorship as an “economic model” to former “command socialist” countries. Otherwise “system change” runs the “permanent danger” of leading to a third way between planning and the market that is condemned to failure.”
Why should this “third way” inevitably fail? “Practical logic” is the reason, said Mr. Schwarz. “Practical logic” is the fundamentalism that forces people to their happiness. “Practical logic” also underlay the “socialist relations of production” that followed the “iron” laws of historical materialism. “Practical logic” does not agree with democracy but leaves decisions to others accepted by the guardians of absolute truth.
Whoever was so naïve to hope for the beginning of a world-embracing democratic culture with the end of the Cold War is now taught something else. The good purpose of the total market also sanctifies the means of “authoritarian dictatorship.” Neoliberalism is no longer forced by system competition to appear on the democratic human rights side in politics. The NZZ (Dec 28/29, 1996) even rejoices that “the social challenges launched by the Soviets” have now become “invalid.” Capital no longer needs to fear that its victims will turn to the other system. During the time of the Cold War, the world power could never have said so openly that the “market economy” is more important for capital than democracy.
“Globalization and its social consequences help authoritarian more than democratic constitutions,” Ralf Dahrendorf said (DIE ZEIT, Nr 14, 1997). This pessimistic liberal who imagines humanity is “at the threshold to the authoritarian century” is doubtlessly right insofar as globalization stands under a neoliberal sign.
7. There is no social ethic that can set limits to the market
The apologists of the “free market economy” reject the reproach of fundamentalism. For them, their theory of the deregulated or total market is not fundamentalist but a criticism that measures the market and its results by social justice.
For neoliberalism, there is only an ethic of individuals, not a social ethic that judges social structures according to a standard of social justice. For Hayek, justice is only an individual virtue and conforming to the system requires only respect for property and fulfillment of contracts. This is also true for the foreign indebtedness of third world countries. Neoliberal ethics requires keeping agreements and paying debts even if the poorest must be sacrificed. Giving alms is in order. However combating the social causes of poverty would be interventionism. Roberto Campos, planning minister under the Brazilian military government and Hayek’s admirer, mocks the “option for the poor.” “Strictly speaking, no one can opt for the poor. The option that can be made is for the investor who creates jobs for the poor.”
That the Biblical message is completely reversed by changing private vices into social virtues does not trouble this neoliberalism. It is convinced that interventionism is of the devil and that the good can only occur in the form of the market and never in the form of social justice. Hayek describes the word “social” as a “weasel word.” A weasel is the little animal that sucks out an egg leaving the shell empty. When the word “social” is connected with the market economy, constitutional state, conscience or justice, it sucks dry these terms and kills their meaning.
Hayek declares flatly “a social market economy is not a market economy, a social constitutional state is not a constitutional state, a social conscience is not a conscience, social justice is not justice and social democracy is not democracy.” As a result, the “amorality” of the market is sanctioned whatever its consequences may be, even unemployment, poverty or ecological destruction.
Hayek also opposes the social ethic of the churches that supports “social justice,” this “slogan of socialism.” “A heavenly promise of justice is replaced by a worldly promise.” The reproach is directed “particularly at the Roman Catholic church” that “makes the goal of social justice into part of its official doctrine.”
8. There is also no business ethic since the only responsibility of a business consists in increasing profits.
Whoever dislikes social ethics cannot usually accept business ethics. He reinterprets and limits it to the interpersonal “charitable” sphere. The denial of all social responsibility of business is also typical for neoliberalism. When the “social responsibility” of business is mentioned at all, it is reduced to profit maximization. Neoliberal “business ethics” follows the famous notorious axiom of Milton Friedman “the social responsibility of business is to increase its profits” (the title of a 1970 essay for Time magazine). Economics professor Walter Wittman writes similarly, “In the market economy, a firm has no social obligation. Social policy is a state problem” (TA, Dec 16, 1977). The former Zurich financial director Eric Honegger reiterates: “Realizing profit is the only economic duty of a business” (NZZ, Oct 5/6, 1996). Such sentences move on the same plane as if unions would say the duty of workers is to receive wages, not to do work.
When shareholder value triumphs, ethics resigns as if is said “Greed is good, sharing is harmful.” This development can lead to dramatic conflicts of conscience. There are top managers who want to take ethical responsibility for their actions and see themselves exposed to a vast pressure of capital interests, especially from powerful investment funds. In “Spiegel” March 8, 1999, Hubertus von Grunberg, head of the Continental tire company, told of his fears of a hostile takeover. Pirelli already made such an attempt. “Today we can only defend ourselves from a takeover through a high stock price. Our investors want to see profits. Otherwise they will bale out, the price will fall and the danger of a takeover will increase.” Therefore he had to shut down a whole factory. “This is cynical: the distress of my employees brought me success with my shareholders.” Investors want to reduce jobs even more. His reply that he is not a “job killer” is pointless. “This is my problem, the investors think. Their duty is to seek higher earning power and prices of the business shares.”
9. The highest criterion of the market is efficiency
The only criterion allowed by the ideology of the “free market economy” is efficiency. According to this criterion, it believes it has won the system competition with “command socialism.” But what really is the criterion of efficiency? Work for everyone? Liberation from poverty? The end of the worldwide problem of hunger? No, the criterion is “business success” which according to the economics editorial staff of the NZZ “should be measured by the economic value created for the owners” (Aug 24/25, 1996). In the 1996 New Year edition, the paper raved about “international capital” “that travels the globe, searching for the `best host,’ comparing, evaluating and gaining worldwide efficiency and speed from its homelessness.”
This system is so efficient that it endangers its own prerequisites, social peace, sustainable relations with natural resources and so forth. It is blind by closing itself to all questions about the meaning and limits of economic efficiency. It is amorous in its downfall. This is part of the sacrifice we owe to the idol market. As Hinkelammert explains, “an invisible hand” leads to a result as though following a uniform plan of destruction” (Neue Wege 1993, p.253). “Visible hands” are replaced with faith in the “invisible hand.”
10. Efficiency is implied in business decisions oriented only in the logic of the market that enforces this logic with the necessary severity.
Whoever follows the language of this efficiency or shareholder fetishism encounters astonishing arguments. The chemical manager and FDP member of the National Assembly Johannes R. Randegger teaches us in “Weltwoche” (Nov 7, 1996): “The economy argues with its own logic. Whoever does not decide brutally quickly loses his chips.” “In their personnel, businesses must create a feeling of urgency and defense,” Arthur Andersen counsels. Whoever does not have enough efficiency becomes “affluent waste,” the 1997 non-word of the year coined by Helmut Maucher. Waste is worthless and is one of the things that disgust us…
The “killer instinct” is regarded as a special mark of quality of a manager. One manager, Helmut Maucher, said in 1991 he was grieved by “ethical and social murmuring.” Managers with a “will to battle” and “killer instinct” are demanded (Arbeitgeber I/1991). An offspring of the British Rothschild banking house was described as a “family man” who lacked the “necessary killer instinct” to successfully manage the business (TA, July 12, 1996). A business consultant Werner Halter found a striking argument for the freedom of movement of persons between Switzerland and the European Union (EU). According to NZZ (March 28, 1996), he recommended several “killer fish” to “fish tank Switzerland” for strengthening the remaining stock. Sexist language against women is also not lacking with all this verbal violence…
Neoliberalism has made a reality out of an ideology and shamelessly exaggerates its one-sidedness. The poor become poorer and the rich richer because of a gigantic redistribution from bottom to the top is charged to its account. In the meantime capitalists doubt “their” system. For example, the US financial guru Georges Soros said: “The global freedom of movement of capital that evades taxation worries me. This reduces states’ capacity to offer social benefits. The poor must pay more since the rich run away” (Spiegel, April 6, 1998). Elsewhere he said: “The most important enemy of the open society is no longer the communist but the capitalist threat” (ZEIT-Punkte 6/97). I would not go so far as the social ethicist Peter Ulrich who declared to “Tages-Anzeiger” (Dec 29, 1998) “neoliberalism strictly speaking is already almost dead.” Then this essay would be unnecessary. Neoliberalism does not give up so quickly.
OR TEN DOGMAS OF NEOLIBERALISM
By Willy Spieler
[This article by the editor of the Swiss “Neue Wege” is translated from the German in: Neue Wege 93, July/Aug 1999.]
Once “neoliberalism” was not identified with the pure market ideology. The “social market economy” was initially included in this term. What appears today as “neoliberal” outlaws the term social. Only a “market economy without adjective” is sought!
The ideology of a pure market economy goes back to Friedrich August von Hayek (1899-1992) who as a professor of economics was even honored with the Nobel Prize for economics. His best known book “The Way to Serfdom” appeared in 1944 in England and was dedicated to “socialists in all parties.” This dedication was directed to middle class representatives of a social market economy intent on social balance.
This ideology of a “pure” market economy unconcerned about social or ecological criteria is made absolute. No other authority is endured beside or over itself. As a result, it becomes an idol like everything finite that absolutizes itself, whether called state, nation, party or church. “The Idol Market” is also the title of a liberation theology book by Franz J. Hinkelammert and Hugo Assmann. Idols have their own magic and fascination. They are overthrown when their absurd exhibitionism is unmasked. This essay seeks to contribute to that unmasking.
Neoliberalism refuses any social or ecological limitation or qualification and has all the attributes of a dogmatic religion. Without claiming completeness, its dogmas are 1. The more the market develops unrestrained, the more it leads the economy to the good. 2. There is no alternative to the global and total market. 3. The market is our fate. 4. This fate demands sacrifice for a better future. 5. The laws of the market are valid absolutely. 6. If the market is in conflict with democracy, the market can demand democracy’s abolition. 7. No social ethic can set limits to the market. 8. There is also no business ethic since the only social responsibility of a business consists in increasing profits. 9. The highest criterion of the market is its efficiency. 10. Efficiency presupposes business decisions only oriented in the logic of the market that enforces this logic with the necessary severity.
1. The more unrestrained and free is the market, the more it leads the economy to the good
For neoliberalism, the market economy is a spontaneous order arising by itself by itself according to the mechanism of supply and demand. Assets are exchangeable for other assets, products for money and labor for wages. The suppliers are in competition with each other which produces the best and most reasonable goods and services for as many people as possible. In this idealized characterization, the market always produces social balance. No social market economy is necessary since the market economy always turns out to be social.
According to the neoliberal interpretation, the market can only fulfill its social function when it is free from state bonds. The function of the state is to advance de-regulation in economic and social policy, in other words to become an “anti-state.” The more freely economic subjects pursue their own interest on the market, the more they serve the goal of the economy, providing people with goods and services.
That the market constantly coordinates individual self-interests into the well-being of the whole is a dogma, not an empirically verifiable statement today. Adam Smith (1723-1790), the founder of “classical” economic liberalism, believed in an “invisible hand” that brings all interests of economic subjects into a constantly new balance. Following the bee fable of the English philosopher and contemporary Bernard de Mandeville (d. 1773), a community thrives best when its members strive for nothing but the realization of their interests which can be selfish interests. The “invisible hand” even molds these egoisms into the welfare of the whole. Private vices become public good deeds. “Private vices equal public benefits.”
The following sentence hurled by a German economics professor Hermann Sauter against his leftist rival Ulrich Duchrow (in: Okumenische Rundschau January 1995) shows that the blind trust in the “invisible hand” rises from the ashes or rears its ugly head again. “The market is concerned objectively for solidarity even if individuals do not see this.” Thus solidarity does not rest on ethics but is produced by itself, quasi-sacramentally (ex opera operato) through the market. Sauter is a member of the board for church development service of the Evangelical church in Germany.
2. There is no alternative to the global and total market
Neoliberalism presents itself as an ideology without alternative. As every dogma is exclusive, the dogma of the pure market economy also raises a claim to exclusivity. Outside the market there is no salvation! Many of our “economic leaders” as they describe themselves also defend this dogma of a market economy. The merger of Novaris and UBS is an example. The marriage of the two Basel chemical giants on March 7, 1996 was not necessary since Ciba and Sandoz set record profits the previous year. The president of the Novaris governing board Alex Kramer justified the merger with the pithy words: “Being good is not good enough. Only the best takes everything…” “Only the best” is the goal; the others are consecrated to destruction. The market economy without adjective is also a market economy without alternative.
In zealous obedience toward the demands of the world market, the fusionists of Novaris and UBS chose the “right moment” for their project in order not to be “forced” later to a merger out of weakness. The economics editor of the “Neue Zurich Zeitung” (NZZ), Gerhard Schwarz, summarized “no firm can evade the dictation of worldwide competition unpunished in the long run” (March 9/10, 1996).
What is true for the freedom of the market was also true in days of yore for freedom in dialectical materialism. Dialectical materialism confined itself to “insight in necessity.” The market is a coercive mechanism. Whoever refuses does this at the price of economic downfall. As Mr. Schwarz formulated, “Whoever wants to be competitive must consistently join in. Otherwise the market quickly shows him the red card.” “There is no alternative from a total social perspective, the vantage point of the public interest.”
“The Man without Alternative” was the title of a book by the young Polish Marxist Leszek Kolakowski widely discussed in the 1960s. He leveled powerful criticism as a Marxist scholasticism that also allowed no alternative since it claimed to be the absolute truth about the course of history and a kind of end time promise. In a famous essay, Pierre Bourdieu pointed to the parallels between modern neoliberalism and vulgar Marxist determinations of the past. The French sociologist was surprised about the “new faith in historical inevitability grounded on the primacy of productive forces (and technology), a new form of economism that at other times and in the ranks of the same believers spread under the banner of Marxism” (Tages-Anzeiger, No.6, 1996). The parallels are striking.
3. The market is our fate
The market is our fate; neoliberalism is a religion of fate. Novaris president Kramer described the demolition of 10,000 jobs as “regrettable but unavoidable in the interest of the future.” Staff reductions are only unavoidable because the capital profit had to rise 20 percent. The fusionists deny they only consider shareholder interests and accept even more unemployment in return. In the Sonntags Zeitung (March 17, 1996), the Novaris president said: “This argument comes from the last century. A conflict of goals between capital and labor is constructed. This is no longer in keeping with the times. Global competition occurs today on one side between locations and on the other side between communities of fate. The Basel region as a location is a community of fate.”
The “community of fate” with its “esteemed co-workers” also belongs to the fate religion of corporate functionaries. However this is not a community of equals. The extolled “shareholder democracy” only exists on paper. Fate religion creates its own hierarchies.
The workers have nothing to say. The social-ethical priority of labor leftist capital is turned upside down. Profit maximization is more important than the preservation or creation of jobs. Businesses are property objects that capital can control as it likes, merging, selling or exploiting according to the style of raiders. There is no evidence of “association of persons” with vested rights of co-determination as the social ethic of Christian churches envisions. Such structures were not agreeable to capital but were almost a positional disadvantage on the world market. Its fatefulness allows no space for social-ethical “idealism.”
4. The market demands sacrifice for a better future
People must suffer under the laws of the free market. For neoliberalism, they have to make this sacrifice for the sake of the freedom of the market which promises a brilliant future to humanity as a whole, if not to them as individuals.
That jobs “must” be destroyed to be preserved is part of this sacrifice religion. Sacrifice is proclaimed to them in a language reminiscent of George Orwell. If it is bad for you today, it is only so you can survive t6omorrow. You are handed over to shareholder interests come what may. When these are satisfied even at your expense, you have a future. But be comforted, this future will bring work and prosperity to everyone. The “dictation of worldwide competition” causes conflicts and hardships to largely dissolve on the aggregate social plane and in the long term,” the NZZ comforts us. Novaris head Vasella, a former surgeon, formulated this in a somewhat less reserved way. To the “Financial Times,” he said: “Job reduction is like a surgical operation. You know it hurts but it is in your best interest. To cut slowly and not deep enough is the worst.”
These rationalizations never end. They justify the dismissals of tomorrow, not only the dismissals of today. “What is true for tomorrow is also true for the day after tomorrow,” the social ethicist Peter Ulrich objected (TA, Dec 29, 1996). The prognosis that one-fifth of the world population able to work can keep the whole world economy going is already widespread. What will happen with the remaining 80 percent? What befell “command socialism” will also befall capitalism. The good end of history suffers under “parousia delay.” The promise of a bright future will never be honored and the sacrifices will become greater and more senseless.
5. The laws of the market are valid absolutely
Neoliberalism is defined by belief in an absolute authority of the laws of the naturally growing “total” and “global market” left to itself. When the rich become richer and richer and the poor become poorer and poorer, the market cannot be responsible, only the state which hinders the market with too many regulations. Since a self-healing power starts from market forces, there can never be a market failure, only a state failure. This is obviously a circular argument but this deficient logic does not worry the priests of the free market economy and exorcists of all state interventionism. Allowing the “visible hand” of the state to intervene against the “invisible hand” of the market would be a lack of humility.
The liberal German politician Otto Graf Lambsdorff writes in the NZZ (Oct 29, 1995) the prohibition of child labor in the third world would have “catastrophic consequences,” not child labor itself. “Such a prohibition would mean hunger, child prostitution and distress.” This is similarly true for ecology. Only “free trade” can create prosperity since it enables people to have a sufficient environmental consciousness. Conversely, does this environmental consciousness result from the damages inflicted on the environment by deregulated free trade?
Neoliberalism shows all the characteristics of a fundamentalist religion. It does not fall back on the “absolute truths” of a “revelation” but on the “worldly” laws of the market for which it claims absolute obligation. Therefore liberation theologians like Hugo Assmann and Franz J. Hinkelammert speak of a “powerful process of idolatry” and “its conspicuous expression in the supposed self-regulation of the mechanisms of the market.”
On every dollar, we read “mammon” guides the “invisible hand.” Besides money, the “fetishism of goods” analyzed by Marx is rated positively by a new perverse “sales culture.” The prophetesses and prophets of advertising no longer praise goods but sacraments. The products offered for sale need not correspond to genuine needs but satisfy the insatiable longings of customers. “Advertising assumes the function of evangelization and the proclamation of the Good News of salvation,” writes Leonardo Boff.
The Gottfried Duttweiler Institute, an institute studying trends, held a meeting in June 1994 on the marvelous mutation of goods into “cult products.” In the invitation prospectus, the question was raised: “How do sacred products arise?” “Cult marketing” and “spiritual selling” are the new marketing trends. A “religious affection” for products must be awakened against the “moralization of consumption and demonization of pleasure.” “Consumer rituals” and “tribal membership of the `like-minded’ define shopping today, not simply experiences or prices. “The spiritualization of markets and the creation of cult products occur along with a revaluation of brand-name articles into fetishes.” Advertising today has the function of providing an “explanation of the world” “through strong metaphors.” “The goods themselves become the strongest of all religions,” declared a satisfied GDI representative after the meeting (TA, June 18, 1994).
6. If the market is in conflict with democracy, the market is entitled to abolish democracy.
“The economy was never a democratic process,” the Novaris head and former Trotskyite Vasella said (Weltwoche, March 19, 1999). This is a problem of politics, not only of the economy. The more an undemocratic economy is deregulated, the more powerful it becomes and the more it begins to regulate politics. This is shows in the manner and way that the economy forces policies to a murderous (suicidal) struggle for location advantage. The goal of politics is what keeps happy the large investors and taxpayers, not what public interest requires.
Contempt for democracy has an ideological explanation in neoliberalism. As every fundamentalism is anti-democratic since absolute truths avoid democratic decision, the “fundamentalism of the market” is anti-democratic. In the case of conflict, the market claims precedence over democracy. If democracy no longer serves or offers sacrifice to the market, then dictatorship is justified.
Several years ago the NZZ described Chile’s military dictatorship under general Pinochet as an “economic model” (Jan 11/12, 1992). Economics editor Gerhard Schwarz bid farewell to the “convenient” thesis that “market economy and democracy belong together like twins.” He referred to examples like Hong Kong, Singapore, South Korea, Taiwan and especially Chile where “brutal dictatorship led to the market economy and growth.” Mr. Schwarz also recommended this brutal dictatorship as an “economic model” to former “command socialist” countries. Otherwise “system change” runs the “permanent danger” of leading to a third way between planning and the market that is condemned to failure.”
Why should this “third way” inevitably fail? “Practical logic” is the reason, said Mr. Schwarz. “Practical logic” is the fundamentalism that forces people to their happiness. “Practical logic” also underlay the “socialist relations of production” that followed the “iron” laws of historical materialism. “Practical logic” does not agree with democracy but leaves decisions to others accepted by the guardians of absolute truth.
Whoever was so naïve to hope for the beginning of a world-embracing democratic culture with the end of the Cold War is now taught something else. The good purpose of the total market also sanctifies the means of “authoritarian dictatorship.” Neoliberalism is no longer forced by system competition to appear on the democratic human rights side in politics. The NZZ (Dec 28/29, 1996) even rejoices that “the social challenges launched by the Soviets” have now become “invalid.” Capital no longer needs to fear that its victims will turn to the other system. During the time of the Cold War, the world power could never have said so openly that the “market economy” is more important for capital than democracy.
“Globalization and its social consequences help authoritarian more than democratic constitutions,” Ralf Dahrendorf said (DIE ZEIT, Nr 14, 1997). This pessimistic liberal who imagines humanity is “at the threshold to the authoritarian century” is doubtlessly right insofar as globalization stands under a neoliberal sign.
7. There is no social ethic that can set limits to the market
The apologists of the “free market economy” reject the reproach of fundamentalism. For them, their theory of the deregulated or total market is not fundamentalist but a criticism that measures the market and its results by social justice.
For neoliberalism, there is only an ethic of individuals, not a social ethic that judges social structures according to a standard of social justice. For Hayek, justice is only an individual virtue and conforming to the system requires only respect for property and fulfillment of contracts. This is also true for the foreign indebtedness of third world countries. Neoliberal ethics requires keeping agreements and paying debts even if the poorest must be sacrificed. Giving alms is in order. However combating the social causes of poverty would be interventionism. Roberto Campos, planning minister under the Brazilian military government and Hayek’s admirer, mocks the “option for the poor.” “Strictly speaking, no one can opt for the poor. The option that can be made is for the investor who creates jobs for the poor.”
That the Biblical message is completely reversed by changing private vices into social virtues does not trouble this neoliberalism. It is convinced that interventionism is of the devil and that the good can only occur in the form of the market and never in the form of social justice. Hayek describes the word “social” as a “weasel word.” A weasel is the little animal that sucks out an egg leaving the shell empty. When the word “social” is connected with the market economy, constitutional state, conscience or justice, it sucks dry these terms and kills their meaning.
Hayek declares flatly “a social market economy is not a market economy, a social constitutional state is not a constitutional state, a social conscience is not a conscience, social justice is not justice and social democracy is not democracy.” As a result, the “amorality” of the market is sanctioned whatever its consequences may be, even unemployment, poverty or ecological destruction.
Hayek also opposes the social ethic of the churches that supports “social justice,” this “slogan of socialism.” “A heavenly promise of justice is replaced by a worldly promise.” The reproach is directed “particularly at the Roman Catholic church” that “makes the goal of social justice into part of its official doctrine.”
8. There is also no business ethic since the only responsibility of a business consists in increasing profits.
Whoever dislikes social ethics cannot usually accept business ethics. He reinterprets and limits it to the interpersonal “charitable” sphere. The denial of all social responsibility of business is also typical for neoliberalism. When the “social responsibility” of business is mentioned at all, it is reduced to profit maximization. Neoliberal “business ethics” follows the famous notorious axiom of Milton Friedman “the social responsibility of business is to increase its profits” (the title of a 1970 essay for Time magazine). Economics professor Walter Wittman writes similarly, “In the market economy, a firm has no social obligation. Social policy is a state problem” (TA, Dec 16, 1977). The former Zurich financial director Eric Honegger reiterates: “Realizing profit is the only economic duty of a business” (NZZ, Oct 5/6, 1996). Such sentences move on the same plane as if unions would say the duty of workers is to receive wages, not to do work.
When shareholder value triumphs, ethics resigns as if is said “Greed is good, sharing is harmful.” This development can lead to dramatic conflicts of conscience. There are top managers who want to take ethical responsibility for their actions and see themselves exposed to a vast pressure of capital interests, especially from powerful investment funds. In “Spiegel” March 8, 1999, Hubertus von Grunberg, head of the Continental tire company, told of his fears of a hostile takeover. Pirelli already made such an attempt. “Today we can only defend ourselves from a takeover through a high stock price. Our investors want to see profits. Otherwise they will bale out, the price will fall and the danger of a takeover will increase.” Therefore he had to shut down a whole factory. “This is cynical: the distress of my employees brought me success with my shareholders.” Investors want to reduce jobs even more. His reply that he is not a “job killer” is pointless. “This is my problem, the investors think. Their duty is to seek higher earning power and prices of the business shares.”
9. The highest criterion of the market is efficiency
The only criterion allowed by the ideology of the “free market economy” is efficiency. According to this criterion, it believes it has won the system competition with “command socialism.” But what really is the criterion of efficiency? Work for everyone? Liberation from poverty? The end of the worldwide problem of hunger? No, the criterion is “business success” which according to the economics editorial staff of the NZZ “should be measured by the economic value created for the owners” (Aug 24/25, 1996). In the 1996 New Year edition, the paper raved about “international capital” “that travels the globe, searching for the `best host,’ comparing, evaluating and gaining worldwide efficiency and speed from its homelessness.”
This system is so efficient that it endangers its own prerequisites, social peace, sustainable relations with natural resources and so forth. It is blind by closing itself to all questions about the meaning and limits of economic efficiency. It is amorous in its downfall. This is part of the sacrifice we owe to the idol market. As Hinkelammert explains, “an invisible hand” leads to a result as though following a uniform plan of destruction” (Neue Wege 1993, p.253). “Visible hands” are replaced with faith in the “invisible hand.”
10. Efficiency is implied in business decisions oriented only in the logic of the market that enforces this logic with the necessary severity.
Whoever follows the language of this efficiency or shareholder fetishism encounters astonishing arguments. The chemical manager and FDP member of the National Assembly Johannes R. Randegger teaches us in “Weltwoche” (Nov 7, 1996): “The economy argues with its own logic. Whoever does not decide brutally quickly loses his chips.” “In their personnel, businesses must create a feeling of urgency and defense,” Arthur Andersen counsels. Whoever does not have enough efficiency becomes “affluent waste,” the 1997 non-word of the year coined by Helmut Maucher. Waste is worthless and is one of the things that disgust us…
The “killer instinct” is regarded as a special mark of quality of a manager. One manager, Helmut Maucher, said in 1991 he was grieved by “ethical and social murmuring.” Managers with a “will to battle” and “killer instinct” are demanded (Arbeitgeber I/1991). An offspring of the British Rothschild banking house was described as a “family man” who lacked the “necessary killer instinct” to successfully manage the business (TA, July 12, 1996). A business consultant Werner Halter found a striking argument for the freedom of movement of persons between Switzerland and the European Union (EU). According to NZZ (March 28, 1996), he recommended several “killer fish” to “fish tank Switzerland” for strengthening the remaining stock. Sexist language against women is also not lacking with all this verbal violence…
Neoliberalism has made a reality out of an ideology and shamelessly exaggerates its one-sidedness. The poor become poorer and the rich richer because of a gigantic redistribution from bottom to the top is charged to its account. In the meantime capitalists doubt “their” system. For example, the US financial guru Georges Soros said: “The global freedom of movement of capital that evades taxation worries me. This reduces states’ capacity to offer social benefits. The poor must pay more since the rich run away” (Spiegel, April 6, 1998). Elsewhere he said: “The most important enemy of the open society is no longer the communist but the capitalist threat” (ZEIT-Punkte 6/97). I would not go so far as the social ethicist Peter Ulrich who declared to “Tages-Anzeiger” (Dec 29, 1998) “neoliberalism strictly speaking is already almost dead.” Then this essay would be unnecessary. Neoliberalism does not give up so quickly.
e-mail:
Homepage:
