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Never Let a Serious Crisis Go to Waste: How Neoliberalism Survived the Financial Meltdown

After the financial apocalypse, neoliberalism rose from the dead—stronger than ever
At the onset of the Great Recession, as house prices sank and joblessness soared, many commentators concluded that the economic convictions behind the disaster would now be consigned to history. And yet, in the harsh light of a new day, we’ve awoken to a second nightmare more ghastly than the first: a political class still blaming government intervention, a global drive for austerity, stagflation, and an international sovereign debt crisis.

Philip Mirowski finds an apt comparison to this situation in classic studies of cognitive dissonance. He concludes that neoliberal thought has become so pervasive that any countervailing evidence serves only to further convince disciples of its ultimate truth. Once neoliberalism became a Theory of Everything, providing a revolutionary account of self, knowledge, information, markets, and government, it could no longer be falsified by anything as trifling as data from the “real” economy.

In this sharp, witty and deeply informed account, Mirowski—taking no prisoners in his pursuit of “zombie” economists—surveys the wreckage of what passes for economic thought, finally providing the basis for an anti-neoliberal assessment of the current crisis and our future prospects.

Reviews

  • “A fascinating account.”
  • “The best and most thorough treatment of the financial crisis’s impact upon the economics profession.”
  • “A study guide for those who saw Inside Job and want more… Anyone who reads it will recognize the author’s enormous energy and originality.”
  • “Raucous, irreverent and highly perceptive.”
  • “It is hard to imagine a historian who was not an economist (as Mirowski is) being able to encompass the economics of the second half of the 20th century in its diversity and technicality.”
  • “Mirowski is the most imaginative and provocative writer at work today on the recent history of economics.”
  • “A powerful critique of neoclassical economics.”
  • “An important demolition of neoliberal dogmas.”
  • “Well worth reading.”
  • “Mirowski exposes the neoliberal takeover of minds and culture with an erudition, style and—dare I say it?—vocabulary that makes deep digging in this Great Bog of Repression almost a pleasure. This book shows how economic ideas caused the crisis. And it demonstrates their enduring triumph, which is that nothing has changed or will change, as we careen from the last disaster to the next one.”

Blog

  • The Macron Phenomenon

    This piece first appeared in Jacobin


    via Flickr

    The French presidential election later this month will be a major turning point in the country’s political history. Beyond the campaign’s many twists and turns — from François Hollande’s decision not to stand for reelection to the collapse of the mainstream right’s candidate, François Fillon — the fact that the two candidates most likely to face off in the second-round elections — Emmanuel Macron and Marine Le Pen — do not belong to either the Socialist Party (PS) or Les Républicains (LR) represents a historic development.

    Since the Fifth Republic formed in 1958, the PS and LR — or any one of the various Gaullist rights — have alternated power. This year, either social-liberal Macron, from the year-old party En Marche!, or far-right Marine Le Pen of the National Front (FN) will likely become president. Every pollster predicts Macron will win in a second round runoff.

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  • Emmanuel Macron, spasm of the system

    First published in Le Monde Diplomatique. Translated by David Broder.



    "I'm going to be very clear..." Probably ignorant of the basic logics of the symptom, Emmanuel Macron seems unable to see how this repetitive way of starting each of his answers betrays the deep desire to cover things up — or rather, to recover them — that animates his whole campaign. "Keep on bathing between vagueness and nothingness" — that is what we should take from each of his promises of clarity. In his defence, we will admit that deferring to the obligation to speak when one's intention is to say nothing at all is one of the curses of this "democracy" that we have still found no satisfactory antidote for. Some will object that most of the candidates end up accommodating to this long and difficult moment — a moment one simply has to go through — and that the campaign-season fib is a well-established genre which should no longer be able to surprise anyone. For Macron, however, the problem takes on unprecedented proportions: not just a matter of slipping across a couple of whoppers, even of the calibre of "my enemy is finance" [as François Hollande claimed before his election in 2012]: rather, his entire campaign, and even his very persona as a candidate, constitute an essentially fraudulent enterprise.

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  • Benign Neglect and Planned Shrinkage

    The frequency and scale of the spectacular fires that consumed much of the South Bronx and other areas of New York City throughout the 1970s can in large part be blamed on the recommendations for fire service reduction made by the New York City-RAND Institute and HUD between 1969 and 1976. In 1973, urban epidemiologists Deborah Wallace and Rodrick Wallace got access to Rand's fire service reports. Immediately recognizing the flimsy pseudoscience that undergirded their claims, they began to write and campaign against the station closures and the other policies based on Rand recommendations.

    "By 1978," the Wallaces write in their introduction to
     A Plague on Your Houses: How New York Was Burned Down and National Public Health Crumbled (published by Verso in 1998), "we discovered that the Rand-recommended fire service cuts had triggered an epidemic of building fires and heated up a related epidemic of building abandonment. We submitted a grant proposal to the National Institutes of Health (NIH) to assess public health outcomes of this massive destruction of housing in New York's poor neighborhoods. The NIH did not even review our proposal. That research plan, carried out over a period of fifteen years without federal funding, resulted in this book."

    In the excerpt below, Wallace and Wallace situate the development of Rand's recommendations in the context of the deliberate de-industrialization of New York undertaken by federal and state officials.  
       


    John Fekner, Charlotte Street Stencils, South Bronx, NY 1980. via Wikimedia Commons.

    Daniel P. Moynihan and Benign Neglect

    Not an arsonist at first glance, Daniel Patrick Moynihan burned down poor neighborhoods in cities across the country as surely as if he had doused them in kerosene and put a match to them.

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