The latest Quarterly Essay has responses to Waleed Aly’s What’s Right?: The Future of Conservatism in Australia, and his reply to them. The response of mine that QE published is copied in below.
I wrote it because responding to writers on ‘neoliberalism’ on blogs or in right-of-centre magazines is ineffective, since reading the views of the people who might be the real-world ‘neoliberals’ has not typically been deemed necessary by their critics. By getting something into the QE I thought Aly at least would read it.
The gist of my argument was to be of any political consequence, characterisations of ‘neoliberalism’ must be based on established beliefs or statements of plausible candidates for being ‘neoliberals’ (I didn’t fully go into this, but I took these candidates as people whose views have family resemblances to the claims about neoliberal beliefs made by academics – this is complicated by the fact that the term if not the idea of ‘neoliberalism’ is a left-wing academic one, with very few self-described ‘neoliberals’).
On this basis, I disputed some of Aly’s claims about ‘neoliberalism’ on the grounds that nobody believed them, or that significant ‘neoliberals’ believed otherwise (eg Thatcher, Milton Friedman). I also used results from my online survey from last year.
Aly responded: ‘The label someone uses to describe themselves in a online survey does not necessarily have any relationship to the terms used in my essay. …. My arguments on climate change were focused on the impact of neo-liberal ideas on politics, not on business people or survey respondents.’
But my argument was that ideas can’t have influence if they don’t exist or don’t have advocates; he has to show that they do before he can move on to the more tricky exercise of working out if there is any actual link between beliefs and policies. I don’t think he successfully does any of these things in the Australian context.
He makes a more plausible case for the Czech Republic, citing the views of its President, Vaclav Klaus. But Klaus does not speak for all ‘neoliberals’ or Australian ‘neoliberals’.
I fear this debate is pointless. It is hard to discuss things with people when there is so little common methodological ground on how to identify and assess evidence.
Early in his essay on the future of Australian conservatism, Waleed Aly remarks that it wasn’t clear what right-wing critics of Kevin Rudd’s Monthly essay on ‘neo-liberalism’ thought the term actually meant. A few of us had been watching the word ‘neoliberal’ spread through left-wing analysis of the free-market movement, but Aly has a point to which he should have paid more attention. If most candidates for being Australian neo-liberals aren’t sure what neo-liberalism is, can it be a useful concept for analysing Australian politics?
I think the answer to that question is no. As Aly and many others use ‘neo-liberalism,’ it is associated with beliefs that few or no people hold. Who believes, as Aly suggests that neo-liberalism maintains, that nothing is valuable unless the market assigns it a value? He cites no sources on this, and even within the individualist framework Aly attributes to neo-liberalism it cannot be correct. Markets assign exchange values, the prices on which buyers and sellers can agree. But prior to this must be the values set by individuals. Culture, sentiment and ethics can all give things a value above money, blocking any exchange. There is a big difference between permitting exchange of goods or services for money, and believing that the market price reflects their only value.
Aly claims that ‘neo-liberalism easily collapses into a theory of pure individualism that risks doing away with society altogether.’ Here Aly quotes Margaret Thatcher’s famous ‘there is no such thing as society’ interview. The point Thatcher was trying to make—admittedly not always clearly expressed—was that there is no abstract ‘society’ responsible for taking care of every problem. Real people pay for any entitlements coming from the state. She talks about families, neighbours, charities, and responsibilities to others, part of what ‘society’ means in ordinary language. It is a long way from Aly’s later claim that neo-liberal politics has almost nothing to do with consideration for others.
For Aly’s essay, the bigger problem is that this line of criticism doesn’t fit with his later analysis of Australian politics. When he turns to the Howard years, his complaint isn’t that the Howard government lacked a concept of society, but that it had too much of one. He accuses it of wanting to foster ‘monoculturalism,’ and engaging in an ‘extensive and often belligerent “Australian values” campaign.’ If the Howard government didn’t engage in a neo-liberal attempt to do away with society, and Aly cannot nominate any Australian intellectual as believing such a thing would be desirable, does this idea belong in an essay on Australian politics?
Aly says neo-liberals believe that markets cannot have negative consequences, leading them to deny climate change rather than admit corrective action is required. But again we have dubious intellectual history and a lack of Australian evidence. If the idea of ‘negative externalities’—as economists call costs like environmental damage—isn’t part of neo-liberal thinking we have to exclude the vast majority of economists from neo-liberalism, since this idea is a standard one in the neo-classical economics taught at most Australian universities. The late Milton Friedman, perhaps the single most important figure in the revival of free-market thinking, argued half a century ago that there are environmental consequences from market activity that governments may need to remedy. The example he gave was pollution in a stream. If Friedman can’t be called a ‘neo-liberal’, who can? While some generally pro-market intellectuals and politicians in Australia are climate change sceptics, Aly offers no evidence that this is because they believe, in principle, that no market corrections are ever required.
While Aly’s neo-liberal framework again doesn’t explain what is going on in Australian right-of-centre politics, he is undoubtedly right that climate change has ‘driven a wedge through conservative politics.’ It is rare for Liberal leaders to lose office on a specific policy rather than general performance issue, but Malcolm Turnbull’s support for an ETS last year cost him his job in a close vote. This division is consistent with the results of an online survey I conducted in early 2009. Among the people identifying as classical liberal or libertarian (tellingly, nobody called themselves a ‘neoliberal’), 9% thought climate change wasn’t happening, 32% thought it was happening due to natural causes, and 42% thought it was happening due to human causes. Policy responses were even more divided. Of those choosing one of the alternatives offered in this question, a small majority favoured action but were split between a carbon tax (33%) and an ETS (24%). Those against action were split between opposing it because the costs of action exceeded the benefits (27%) and because there was not a problem to be fixed (17%).
Aly thinks that a conservatism freed of neo-liberal influences would help conservatives deal with the climate change issue. He may be right that conservatives along would have less internal difficulty with climate change politics without the influence of free-market supporters, but not in the policy direction he anticipates. Of the people who chose conservative labels in my survey, 20% thought that climate change wasn’t happening and 51% thought it was happening but due to natural causes. Pro-climate action arguments come mainly from people on the free-market side, and conservatives would be more united—though probably not closer to the best policy response—if they flew solo on climate change.
The idea of ‘neo-liberalism’ gets in the way of good analysis of Australia’s last quarter century. While markets have replaced bureaucratic control in some areas of the economy since the early 1980s, the often outlandlish beliefs Aly and others associate with neo-liberalism cannot explain this fact. I believe analysing the push for free market policy change needs to start by seeing it an issue movement rather than as a single ideology. As with other issue movements like environmentalism or feminism, the unifying feature is a broad cause and policy direction, and not a common orthodoxy. The intellectual revival of classical liberal and libertarian ideas and intellectually confident neo-classical economists helped put market ideas on the policy agenda. But the actual implementation was largely carried out by self-described social democrats and conservatives, with each group having their own pragmatic rather than ideological reasons for needing to reform particular industries or improve Australia’s economic performance. Good history requires looking at why people acted they way they did from their own perspective.
Waleed Aly, and the many other academics offering similar accounts of Australian politics, should throw out any material relying on ‘neo-liberalism,’ and start again with the actual words of the many Australians who, over the last 40 years, have called for free-market reforms.
Andrew Norton is editor of Policy, published by the Centre for Independent Studies. He has been following left-wing critiques of free-market thinking since the 1980s, and co-edited A Defence of Economic Rationalism (Allen & Unwin, 1993). More results from his survey of ideological political opinion were published in the Spring 2009 issue of Policy, available at www.policymagazine.com.