Alex Himelfarb on Neoliberalism: Canada’s Challenge”

Alex Himelfarb’s recently released book, Breaking Free of Neoliberalism: Canada’s Challenge, examines the history and development of the neoliberal ideology, which approach unfortunately governs most so-called developed nations today. His contribution to our understanding of the scourge of this ideology is erudite, thoroughly researched and an important read for all of us seeking to understand the chaotic mess of the second Trump administration. For Canadians, who have not yet taken the extreme step of putting a MAGA-like politician in as Prime Minister, the book is a precautionary and enlightening tale. We would be well advised to take its message to heart if we are to have a hope of both avoiding making the same gigantic mistake as the Americans just have and to survive the Trump imperialist autocracy south of the border.

In any inquiry into governance, the key questions are always: ‘By whom?’ and ‘For whose benefit?’ As Himelfarb points out, the stated interest of early neoliberals was to free the global economy and to prevent interference by the state and from the risks of economic nationalism or popular demands – in other words, from too much democracy. Democracy, “ordinary people seeking to realize their shared interests and their sense of the common good” (p. 29, Himelfarb) was considered a threat to individual freedom and progress. For the cynic, it is more likely that the ideological appeal of neoliberalism was to prompt a return to the gilded age where it was considered self-evident by those of wealth and power that the US was better off being run by the wealthy elite rather than by the ‘common’ man, or as often expressed or implied, the undeserving poor. In other words, it appears that the neoliberal band wagon was developed and set in motion both ‘by’ and ‘for’ the wealthy and powerful.

Be that as it may, their naïve dualistic argument was that communism and fascism were bad (which they are) and the opposite, what has turned out to be unbridled capitalism, must therefore be good. They mostly dressed up their rhetoric in more appealing terms, despite the often blatant (and thinly veiled) appeals to racism and bigotry and drew upon a deceptive and selective misreading of thinkers such as the Scottish economist and philosopher Adam Smith. Unsupported by any evidence whatsoever, this doctrine disregards the social sciences in favor of a fixation upon classical economics. 

The vision of the neoliberals mandated a market-driven society arrived at through the deregulation of capital markets and lowering of trade barriers. Businesses and individuals were to be freed up to compete in the economy and price controls and other similar policies verboten. Indeed, calls for deregulation extended beyond the capital markets to business conduct in general so that the private sector could be ‘unleashed’ in the vernacular of its proponents. To support this, the American libertarian, economist and statistician Milton Friedman argued that the sole social responsibility of any business was to maximize its profit and to increase returns to shareholders. (Ironic how the results of his research were so closely aligned with his political / ideological beliefs.) Thus, the interests of customers, employees, society, the planet etc. are all unimportant unless they can be shown to directly lead to profit. 

To ensure there is no interference in the pursuit of these objectives, the State’s influence in the economy must be reduced through privatization and austerity. The diminished role of the State of course has the added benefit of reducing taxes which are felt to be a drag on competition and the private sector, not to mention being an unwelcome draw on the bank accounts of the wealthy and powerful. 

When issues of the common good such as social welfare, environmental damage and climate change, customer safety, democracy and/or social justice and cohesion (to name just a few) were raised, they were effectively brushed off. We were assured that these ‘externalities’, in the jargon of classical economics, would be addressed. Unfortunately, evidence that this has happened is spotty at best and the years of austerity, increase in income inequality and disregard of the climate crisis around the globe driven by neoliberal institutions and governments has put the lie to this rhetoric. More to the point, we see how this proposed way of avoiding fascism has laid the foundation for the United States to become an autocratic and fascist state. It is hard to avoid concluding, despite the original neoliberals’ protestations to the contrary, that this was the intent (or hope) all along. 

A further consequence of neoliberalism is that competition in the market has become the model for all aspects of society, described by American political theorist Wendy Brown as “the economization of everything.” (p. 29, Himelfarb) meaning choices are made solely based on what is profitable. As Himelfarb points out, “’Good’ is achieved not by a collective conversation, deliberation and cooperation but by the individual decisions of market actors seeking to enhance their value.” (p. 30, Himelfarb). Value is not measured by fairness, equality, or environmental sustainability or even by what an infinite planet can accommodate. But by the metrics. While proponents of the neoliberal approach lay claim to the moral high ground of “common sense”, the reality in our thoroughly quantified world is that it all boils down to “dollars and cents”, to profit. And given that (in my jaded view) capital markets more and more resemble nothing more than a legalized gambling system (thus the term Casino Capitalism), the only profits that matter are those in the short term. The long term is someone else’s problem. As Himelfarb says: “Liberty itself is reduced to the freedom to compete unimpeded not just in the market but in our lives, a chance to win or not to lose too badly in a world of winners and losers.” Both democracy and humans are shrivelled as we become “self-interested calculating machines.” (p. 30, Himelfarb).

What Alex brings to this discussion is a sociological approach which highlights the fatal flaw of neoliberalism and the individualistic approach to life that it engenders. This is as refreshing as it is unusual. I did my doctorate in the field of Managing in Complexity which is inspired by the complexity sciences and draws heavily on the social sciences of pragmatic philosophy and group dynamics and sociology. This compares with the traditional management discourse that speaks of tools and techniques, admires quantification and measurement, disregards social considerations and believes that good leaders / managers can control and determine what will happen. (To the latter point, I have always joked that if they can indeed control and determine what will happen, they would be down in the Caribbean on their fancy yachts.) In the process, we lose sight of the fact that management is about how we work together given the social nature of collective work. The same can be said for how we govern ourselves and I would argue that incorporating insights and research from the social sciences into our understanding of both management and governance is long overdue. 

The thread that runs through this book is the tension between individual benefit and the common good of society. As Himelfarb notes, this is not an inconsequential issue. Margaret Thatcher, a key individual in the history of neoliberalism famously observed that there is no such thing as society, just individuals and families who look to themselves first. In other words, self-reliance followed closely by self-interest. Neoliberalism’s self-serving promotion of the glories of individualism at the expense of the collective good to counter fascism and communism is dualistic and naïve reasoning at its worst. In a complex world, dualistic thinking, in other words saying using ‘either / or’ reasoning, is generally ineffective. Instead, we are almost always in the world of paradoxes or ‘both / and’. A paradox represents what would appear to be two self-contradictory statements which are both true at the same time. It is the coexistence of one thing and, at the same time, its opposite. This is particularly so when it comes to relationship between the individual and the social!

In my book, Managing in Complexity: How Our Fears of Uncertainty Can Hurt Us and What to Do About It, I discuss how in our complex world, we as individuals and families are inextricably interconnected. This is a paradoxical relationship and means that both the “I” and the “we” mutually co-constitute each other. The individual does not exist without the social and society and in turn, society does not and cannot exist without the individual. Research shows that we are the individuals we are because “of all those with whom we have interacted and the groups we have belonged to. Our very sense of self and development of our identity is a dynamic, evolutionary, and social undertaking” (p. 70, Filbee). The “I” and the “We” are two sides of the same coin. We are interdependent and not atomistic individuals existing in a vacuum. To discount society is to discount the individual and vice versa. In other words, it is not just one or the other, it is necessarily both, at the same time. Indeed, it is a world in which both the individual and the collective are essential for our sustainable mutual wellbeing. 

To better understand how the individualistic thinking and neglect of the common good inherent to neoliberalism plays out, think about the unanswered question of this ideology: “If the individual is all that is important, then how do we navigate our relationships with each other given that we all share the same planet / space?” The traditional ‘each for themselves’ or ‘dog eat dog’ approach results in each person putting themselves first, often on a transactional basis. Putting to one side for a moment that no one can survive let alone thrive without others (even our development as a human being is dependent upon others), this sets up a perpetual competition. A hierarchy of dominance, of winners and losers, necessarily arises which governs how our relationships with each other are regulated, rather than any consideration of the common good. This is not a bug that can be fixed but an essential feature of neoliberalism and its focus upon the individual.

Further, in this loss of concern for the common good (back to the finite planet problem), there are to be as few as possible limitations upon individuals. In a neoliberal environment everyone is to be free to compete and to win if they can. There is a joke that goes:” Why do dogs lick their balls?” The answer of course, is “because they can!” Unfortunately, this joke explains way too much about our society. If you can do something, if you can get away with it, then good for you. And we get a world in which a US Presidential candidate claims publicly that he is smart because he doesn’t pay tax, amongst other egregious forms of behaviour. We get a world in which the nonsensical assumption that perpetual growth is possible governs. We get a world in which one’s worth is determined by one’s bank account, one of rising income inequality as winners and losers sort themselves out, and one in which status competition supercharges the need for individuals to over-consume, and ostentatiously so. 

Thus, the fatal flaw of neoliberalism is that it bases our governance upon an ideology which does not consider, and in fact denigrates, our inescapable interdependencies. It bears repeating that this doctrine flies in the face of what we do know about the paradox of the individual and the social, namely that both the individual and the collective are essential for our sustainable mutual wellbeing. Instead, it venerates financial success and perpetual competition to rank in the dominance hierarchy. Together with the insistence that we must lessen / get rid of constraints on the private sector, this ultimately leads us to an increase in monopolistic and / or oligopolistic behaviours on the part of corporations – because they can! Ironic how perpetual competition of ‘unleashed’ businesses seems to lead to a shutting down of that very same competition.

And why do I say fatal? Whether we like it or not, we are on a finite planet and one way or another we must find a way to live and work together. Instead, what we have seen in these early days of the ‘second coming’ of Donald Trump as POTUS, is the newly installed President of the US following the Facebook internal motto of “moving fast and breaking things”. He has signed a flurry of executive orders which may or may not be legal and appears (so far successfully) to be counting on the tactic of flooding the zone to prevent effective opposition. These actions include handing federal assets such as the Treasury over to unelected and unaccountable individuals, reawakening the imperialist spirit by seeking to take over one country after another, turning on allies and long-term friends of the US, and generally creating an unholy mess which can only benefit those at the very top – and probably not even them ultimately. Any pretense of the common good has completely disappeared. While in my view this type of approach (particularly when the breaking part extends to people) is not effective in any organization, in a complex nation such as the United States (not to mention the rest of the world), it is a recipe for chaos.

Many would suggest that this is the point and that the desired outcome of this form of governance is the extreme of dominance hierarchies, fascism and authoritarianism. A world in which a few mega-wealthy billionaires can seize (and in fact have seized) control of the US and beyond – the very outcome that early neoliberalists said they wished to avoid. 

An interesting take on the rise of fascism and authoritarianism was proposed by historian Cornelius Sipple of DePaul University. He disagreed with the common assumption that the continuum between the far right and the far left is a straight line, and that authoritarianism and fascism was limited to the far left. Instead, he suggested that the continuum between these two ideologies was in the form of a circle with the meeting point between the two converging on fascism and authoritarianism. Getting back to the paradox of the individual and the collective, the “I” and the “We”, this makes sense. Whether the dominant paradigm is individualistic or supporting the collective above all, the resultant dysfunction and power dynamics bring one to the same place. It is only when both the individual and the collective are respected, valued and invested in that democracy becomes possible.

Another important argument of Himelfarb, is his view that neoliberalism has become a “political order”, a set of ideologies, policies, and constituencies and interests that defines not only what is desirable but what is possible. As a political order, neoliberalism becomes the universally held common sense, the ‘what everyone knows’, and the ‘foundational and starting assumption’ for the way things are and must be. 

Thus, any challenge to the neoliberal grip on our imagination and minds, is not possible because neoliberalism has defined ‘what is possible’ and what can even be discussed. Again, it has won the power to control and determine the ‘starting point’ of any consideration of alternative approaches. Even some of my most socially liberal friends, are still seduced by the ‘truths’ of neoliberalism that a ‘free market’ will allocate resources the most effectively, that governments are inherently wasteful and not capable of running anything and just get in the way of the private sector which must be ‘unleashed’, that taxes are inherently a bad thing and so on.

And this is so long after neoliberalism has shown us that it cannot deliver upon its promises and research and evidence has accumulated that this way of governing ourselves has instead led us to a world mired in a series of existential polycrises, with no end in sight. We have chosen to exist in an individualistic and hierarchical world rather than an egalitarian one that places value upon the collectivity as well as the individual. In doing so we have put the interests of the moneyed and the powerful few over those of the collective (including future generations). And in the ‘economization’ of everything, all sorts of other ‘goods’, the environment, healthy social outcomes, peaceful coexistence and so on, get short shrift.

Himelfarb ends his book with his thoughts on what we should / could do about the damage that neoliberalism has done to humanity and the planet. This is a daunting challenge, and it is very difficult to see how we get out of our current mess. Here, the concept of ‘path dependence’ or ‘sensitivity to initial conditions’ that is an inherent feature of complexity becomes important. This says that past actions and choices enable or constrain future choices and options.  Certain ways of being are ruled out, others open up. You cannot undo the past or go back to what was before. Thus, the shattering of the public order that is currently going on in the US cannot be undone. Even if we can get our world on a better path which at this point doesn’t seem likely at least in this generation, it can never go back to where it was before neoliberalism, before Trump.

In the result, it is hard, given all that has happened and the nonsensical and yet enduring hold that neoliberalism has on public discourse, to understand how we can stop this vicious descent into madness. Indeed, it is quite possible that we may have passed the point of no return (at least in our lifetimes). E. Eggert, in Gradually, Then Suddenly in Substack argues eloquently that:

Despite conservatism’s dream of denial, we clearly live in the Buddhist world of impermanence. In addition, Darwinian evolution emphasizes the ability of almost all creatures to adapt to gradual change. Sudden change presents far more difficulty. We have seen slow but steady changes in our world over the last few decades, and especially in the first quarter century of this century — the increasing impacts of climate change; the erosion of democracy both here in the US and elsewhere abroad; the increasing power of transnational oligarchs; and the fragmentation of the media and decline in trusted sources due to rapid technological change. As we enter the second Trump presidency, it seems pretty clear that all these trends are reaching the “then suddenly” stage of rapid change and are increasingly interrelated. And it is clear that most people and the institutions that support them are woefully unprepared for what lies ahead.

Being at the ‘sudden’ stage is terrifying and daunting to those of us that seek to find a way to shake loose of the neoliberal yoke. It is difficult to comprehend how democracy can be restored without violence. And even with violence (which I definitely do not advocate), it is challenging to believe that we can undo the harm that has been done and not just substitute one autocrat for another.

Some books put you to sleep. Others, such as Breaking Free of Neoliberalism make it impossible to sleep. That said, it is a necessary read for all of us trying to understand our times, and I highly recommend it. For those of you who, like me, feel shattered and helpless and tempted to give up, giving up is more to be feared because that is the final betrayal and abdication of our responsibility to others. While we cannot undo what has been done, we need to try to understand how we have come to this awful place if there is to be any hope of a future for humanity. Neoliberalism, in my view, has brought us to this precipice and what it defines as accepted wisdom has failed us miserably. The way forward cannot be more of the same. Yes the forces against us are insidious, embedded and often invisible, but making them less so becomes part of our assignment.

As to where we might go from here, I can do no better to wrap up my thoughts on this book but to quote Himelfarb’s penultimate paragraph (p. 219):

The crises are upon us. We need to act, to act together. The threat of tyranny makes it imperative. The climate crisis makes it urgent. There’s no shortage of ideas about what must come next. There is more agreement than disagreement among those seeking progressive change. Our separateness is not serving any of us. Hannah Arendt cites Aristotle to remind us that “a community is not made out of equals, but on the contrary of people who are different and unequal. The community comes into being through equalising.” Given the stakes, we need to find the will, the courage and the humility to join the fight, to join our particular fights to the fights of others, to practice solidarity and to rediscover our shared humanity and the common good.