Never Let A Serious Crisis Go to Waste. Philip Mirowski
on a contractual basis.83 Here again our commandments touch directly upon the crisis. The financial sector was one of the major sites of the outsourcing of state supervision to quasi-private organizations, such as the Financial Industry Regulation Authority (FINRA) or the credit rating agencies such as Moody’s, Fitch, and Standard & Poor’s.84 Indeed, the very “privatization” of the process of securitization of mortgages, which had started out in the 1960s as a government function, has become a flash point in explanations of how the financial sector lost its way. The willful blurring of the line between a private firm and a political instrument in the United States in the cases of Freddie Mac and Fannie Mae will be treated in chapter 5.
One of the great neoliberal flimflam operations is to mask their role in power through confusion of “marketization” of government functions with the shrinking of the state: if anything, bureaucracies become more unwieldy under neoliberal regimes.85 Another is to imagine all manner of methods to “shackle” the state by reducing all change to prohibitive constitutional maneuvers (as with the “public choice” school of James Buchanan). In practice, “deregulation” always cashes out as “reregulation,” only under a different set of ukases.
[5] Skepticism about the lack of control of democracy is periodically offset by recognition of the persistent need for a reliable font of popular legitimacy for the neoliberal market state. This is a thorny problem for neoliberals: how to maintain their pretence of freedom as noncoercion when, in practice, it seems unlikely that most people would freely choose the neoliberal version of the state. As Hayek once wrote: “It would be impossible to assert that a free society will always and necessarily develop values of which we would approve, or even, as we shall see, that it will maintain values which are compatible with the preservation of freedom.”86 In one sense, the NTC is itself one practical political solution to this conundrum: the Russian doll exists, in part, as a conscious intervention to change the culture in a direction more favorable to the neoliberals by disarming political opposition. However, since the very project itself could be regarded as violating a precept of the inviolability of individual volition, the neoliberals also have proposed a conceptual “fix” for the audacity of intervention.
Neoliberals seek to transcend the intolerable contradiction of democratic rejection of the neoliberal state by treating politics as if it were a market, and promoting an economic theory of “democracy.” In its most advanced manifestation, there is no separate content of the notion of citizenship other than as customer of state services.87 This supports the application of neoclassical economic models to previously political topics; but it also explains why the neoliberal movement must seek to consolidate political power by operating from within the state. The abstract “rule of law” is frequently conflated with or subordinated to conformity to the neoliberal vision of an ideal market. The “night watchman” version of the state is thus comprehensively repudiated: there is no separate sphere of the market, fenced off, as it were, from the sphere of civil society. Everything is fair game for marketization.
The neoliberals generally have to bend in pretzels to deny that in their ideal state, law is a system of power and command, and is, rather, a system of neutral general rules applicable equally to all, grounded in something other than the intentional goals of some (that is, their own) group’s political will. As Raymond Plant explains, for the Rothbard anarchists, this is something like natural law; for the Buchanan-style public-choice crowd, it is contract theory; for Chicago economics, it is a world where the economy is conflated with the universe of human existence; and for Hayek, it is his own idiosyncratic notion of cultural evolution.88 In everyday neoliberalism, the Chicago story seems to win out. However, in the recent crisis, the evolution story has been brought out of mothballs, as we shall observe in chapter 6.
[6] Neoliberalism thoroughly revises what it means to be a human person. Many people have quoted Foucault’s prescient observation from three decades ago: “In neoliberalism . . . Homo Economicus is an entrepreneur, an entrepreneur of himself.”89 However, they overlook the extent to which this is a drastic departure from classical liberal doctrine.
Classical liberalism identified “labor” as the critical original human infusion that both created and justified private property. Foucault correctly identifies the concept of “human capital” as the signal neoliberal departure—initially identified with the MPS member Gary Becker—that undermines centuries of political thought that parlayed humanism into stories of natural rights. Not only does neoliberalism deconstruct any special status for human labor, but it lays waste to older distinctions between production and consumption rooted in the labor theory of value, and reduces the human being to an arbitrary bundle of “investments,” skill sets, temporary alliances (family, sex, race), and fungible body parts. “Government of the self” becomes the taproot of all social order, even though the identity of the self evanesces under the pressure of continual prosthetic tinkering; this is one possible way to understand the concept of “biopower.” Under this regime, the individual displays no necessary continuity from one “decision” to the next. The manager of You becomes the new ghost in the machine.90
Needless to say, the rise of the Internet has proven a boon for neoliberals; and not just for a certain Randroid element in Silicon Valley that may have become besotted with the doctrine. Chat rooms, online gaming, virtual social networks, and electronic financialization of household budgets have encouraged even the most intellectually challenged to experiment with the new neoliberal personhood. A world where you can virtually switch gender, imagine you can upload your essence separate from your somatic self, assume any set of attributes, and reduce your social life to an arbitrary collection of statistics on a social networking site is a neoliberal playground. The saga of dot.com billionaires, so doted over by the mass media, drives home the lesson that you don’t actually have to produce anything tangible to participate in the global marketplace of the mind. This is the topic of chapter 3.
The Incredible Disappearing Agent has had all sorts of implications for neoliberal political theory. First off, the timeworn conventional complaint that economics is too pigheadedly methodologically individualist does not begin to scratch the neoliberal program. “Individuals” are merely evanescent projects from a neoliberal perspective. Neoliberalism has consequently become a scale-free Theory of Everything: something as small as a gene or as large as a nation-state is equally engaged in entrepreneurial strategic pursuit of advantage, since the “individual” is no longer a privileged ontological platform. Second, there are no more “classes” in the sense of an older political economy, since every individual is both employer and worker simultaneously; in the limit, every man should be his own business firm or corporation; this has proven a powerful tool for disarming whole swathes of older left discourse. It also appropriates an obscure historical development in American legal history—that the corporation is tantamount to personhood—and blows it up to an ontological principle. Conversely, it denies personhood to government: “Government has no economic responsibility. Only people have responsibility, and government is not a person.”91 Third, since property is no longer rooted in labor, as in the Lockean tradition, consequently property rights can be readily reengineered and changed to achieve specific political objectives; one observes this in the area of “intellectual property,” or in a development germane to the crisis, ownership of the algorithms that define and trade obscure complex derivatives, and better, to reduce the formal infrastructure of the marketplace itself to a commodity. Indeed, the recent transformation of stock exchanges into profit-seeking IPOs was a critical neoliberal innovation leading up to the crisis. Classical liberals treated “property” as a sacrosanct bulwark against the state; neoliberals do not. Fourth, it destroys the whole tradition of theories of “interests” as possessing empirical grounding in political thought.92
Clearly, we’re not in classical liberalism anymore.
[7] Neoliberals extol “freedom” as trumping all other virtues; but the definition of freedom is recoded and heavily edited within their framework. Most neoliberals insist they value “freedom” above all else; but more hairs are split in the definition of freedom than over any other neoliberal concept. This is probably a necessary consequence of the development of other neoliberal tenets, like that covered in thesis 6. It is a little hard to conceptualize freedom for an entity that displays