We need a Mont Pelerin of the Left

The neoliberal world is in turmoil. The economic ideology which has been a dominant feature of international politics for several decades faces its biggest challenge to date with the response to COVID-19. Neoliberalism in many countries, especially in the West, has reached hegemonic status and it continues to have a profound impact on developing world countries as well.

The emergence of neoliberalism onto the global stage in the 1970s and early 1980s was the result of decades of intellectual and ideological development by right-wing academics and economists. The seminal meeting in the formation of neoliberalism was the meeting at Mont Pelerin, Switzerland in 1947. This followed on from an earlier meeting at the Colloque Lippmann in Paris in 1938. Presiding over the meeting was the leading right-wing economist Friedrich von Hayek, who a few years earlier had published his most well-known work, The Road to Serfdom. Alongside Hayek were the leading neoliberals of the time including Hayek’s mentor and fellow Austrian economist Ludwig von Mises, the Chicago economist Milton Friedman and the leading Ordoliberal economist, Wilhelm Röpke. All the major schools of neoliberal thought were represented at Mont Pelerin: the Austrian School, the Chicago School and the Ordo School.

The Mont Pelerin gathering laid the foundations of the Mont Pelerin Society, along with a statement of six aims which gave an ideational basis to neoliberalism. Over the decades that followed, Hayek and Friedman worked to establish a public policy basis for what Friedman was already calling by 1951 “neo-liberalism”. The ideas of neoliberalism were disseminated by academic research institutions such as the Economics Department of the University of Chicago and leading right-wing think tanks such as the Institute of Economic Affairs (IEA) established in the United Kingdom in 1955.

What began to emerge therefore was the framework of an international ideology which has become established as neoliberal hegemony. Today that hegemony has been challenged by the global coronavirus crisis like never before, as domestic governments extensively expand their intervention in the economy to counter the public health crisis. Neoliberalism has faced substantial challenges in the past, such as the North Atlantic Financial Crisis of 2008. Back then the narrative was that neoliberalism was finished and that a return to a more statist, if not Keynesian, economic order seemed likely. This did not happen and instead a new phase of neoliberal austerity began with unprecedented cuts to social welfare and public services.

This time must be different. There can be no going back to austerity. Even leading British right-wing think tanks appear to see that the writing is on the wall for austerity. What progressives need to ensure is that a viable alternative replaces neoliberalism which places the values of social justice, the common good, ethical economics and economic democracy at its heart. To do this, there will need to be a project not too dissimilar to the one which began to forge transatlantic neoliberalism at Mont Pelerin. In the aftermath of the coronavirus crisis, there will need to be a consensus on the left as to the form an alternative to neoliberalism should take. This will inevitably include a gathering of leading progressive intellectuals. The likes of Rutger Bregman, Mariana Mazzucato, Thomas Piketty, Ha-Joon Chang, Naomi Klein, Guy Standing and Amartya Sen would seem like obvious candidates to provide the ideas to shape such an alternative.

What issues would a Mont Pelerin of the left need to resolve? Firstly, how best to deliver social justice and a radical redistribution of wealth from the richest to the poorest in society. One idea which has achieved greater prominence since the current crisis began, is that of the universal basic income (UBI). While UBI has committed supporters from the socialist left to the libertarian right (even Friedman advocated a form of it with the negative income tax), the real battleground will be around the form a UBI takes, how generous it is and how it is funded. A libertarian model of flat taxes and minimal welfare provision to deliver UBI would seem greatly unpalatable to socialists, social democrats and social liberals.

Another issue that would need to be resolved is the politics of ownership. Should key industries be nationalised and taken back into the public sector? What role should there be for employee models of ownership, profit-sharing and traditional worker cooperatives? Not to mention the reorganisation of the firm as an institution with a view to making it more democratic and accountable to both its workforce and customer base.

An overriding theme of any alternative to neoliberalism has to be a commitment to ending that other major global crisis which risks the stability of the world, the crisis of climate change. Ideas such as the Green New Deal would help to facilitate a sustainable economy with a high reliance on renewable energy sources built on solid Keynesian foundations. If the current crisis has shown anything it is that the reckless pursuit of profit and growth as being the only viable ends to the economy is hollow and even destructive. There is more to an economy than just GDP. New measurements of the economy will have to be adopted as well, perhaps those which measure levels of inequality and wellbeing.

            The international academic left will have to bring together the multiple strands of thought which it advances against neoliberalism into a single project with a multinational basis. What is needed is a new form of progressive politics for the world of the twenty-first century, just as social democracy and Keynesian social liberalism were well-placed to effectively address the socioeconomic inequalities of the post-war era. A post-Keynesian and progressive gathering similar to that at Mont Pelerin could begin to usher in an effective and viable alternative to neoliberalism. The ideas of such a programme could inform policy research in numerous academic institutions and progressive think tanks around the world with the potential to construct a new progressive hegemony. The old economic order is crumbling and must be replaced by something more progressive and egalitarian than what went before. There is no time to waste.

Bibliography

            Birch, Kean (2017) A Research Agenda for Neoliberalism. Cheltenham: Edward Elgar Publishing Limited.

Birch, Kean and Mykhnenko, Vlad (eds.) The Rise and Fall of Neoliberalism. London: Zed Books.

Friedman, Milton (1951) “Neo-liberalism and its Prospects” in Farmand, 17 February 1951, pp. 89-93: https://miltonfriedman.hoover.org/friedman_images/Collections/2016c21/Farmand_02_17_1951.pdf. Accessed: 25/05/2020.

            The Guardian – (16/05/2020) “Rightwing thinktanks call time on age of austerity”: https://www.theguardian.com/politics/2020/may/16/thatcherite-thinktanks-back-increase-public-spending-in-lockdown. Accessed: 25/05/2020.

Hayek, Friedrich von (2001) The Road to Serfdom. Abingdon: Routledge.

Held, David (2004) Global Covenant: The Social Democratic Alternative to the Washington Consensus. Cambridge: Polity Press.

Mirowski, Philip and Plehwe, Dieter (2015) The Road from Mont Pelerin: The Making of the Neoliberal Thought Collective. Cambridge, Massachusetts: Harvard University Press.

Mont Pelerin Society – “Statement of Aims”: https://www.montpelerin.org/statement-of-aims/. Accessed: 25/05/2020.

Peck, Jamie (2014) Constructions of Neoliberal Reason. Oxford: Oxford University Press.

            Steger, Manfred B. and Roy, Ravi K. (2010) Neoliberalism: A Very Short Introduction. Oxford: Oxford University Press.

Remembering the Republican Liberal Political Tradition

Liberalism and Republicanism have been in the vanguard of advancing political liberty, socioeconomic justice and democracy over the last few centuries. Both philosophies are at the heart of the turbulent changes that happened in European and American nations in the seventeenth, eighteenth and nineteenth centuries. The history of liberalism stretches back to the writings of John Locke in the late seventeenth century. Although liberalism did not emerge as a self-conscious political project until the early nineteenth century, where it emerged in Spain as a political movement for radical constitutional reform during the Peninsular War. Republicanism has a much longer history stretching back as far as the Roman Republic and even further to Ancient Athens and its classical philosophers, such as Plato and Aristotle.

 

            Liberalism was born out of republican philosophy. The root of liberalism comes from the republican virtue of liberality (liberalitas). This was the virtue which concerned generosity (both personal and societal) and open-mindedness. The New York academic Helena Rosenblatt has charted the history of liberalism as a form of liberality in her 2018 book, The Lost History of Liberalism.

 

The two political philosophies have been closely linked together. Both were at the heart of the American Revolution in the eighteenth century and the European Spring of 1848. It is in the French Revolution that we can see the biggest contrast between the two philosophies. Initially, the French Revolution was very much a liberal revolution committed to liberty, individual rights, constitutionalism, government by consent and limited monarchy. The liberal revolution of 1789 gradually becomes more republican with France being declared a Republic in 1792. France’s republican experiment becomes most radical in 1793 with the rise of Maximilian Robespierre and the clearly illiberal ‘Reign of Terror’.

 

In recent decades within the academy, both liberalism and republicanism have seen a revival in the western political philosophical tradition. Starting with the publication of John Rawls’ A Theory of Justice in 1971 which gave a philosophical contractarian basis to American social liberalism, which itself has been built on by successive authors most notably by Amartya Sen in The Idea of Justice. Republicanism has also witnessed a substantial revival with the neo-republicanism of Philip Pettit. Pettit’s Republicanism (published in 1997) successfully re-conceptualises freedom as republican liberty, that is liberty as non-domination.

 

            Looking back at history it is often difficult to distinguish two distinct political projects. Many leading liberals were also republicans and vice versa. Thomas Jefferson was a liberal political thinker who was a founding father of the American Republic. Additionally, Thomas Paine was a radical republican writer, who also drew heavily on the classical liberal political culture of his time. The great French philosopher Baron de Montesquieu was one of the leading liberal thinkers of the eighteenth century who provided the main inspiration for the republican system of government in the United States. Even John Locke’s writings have clear elements of republicanism within them. There are examples of republicans who were clearly not liberal, such as Oliver Cromwell and Robespierre; as well as liberals who were not republicans, such as the original Spanish liberals (Liberales) who strove to establish a constitutional monarchy.

 

            The republican liberal political tradition has a long intellectual lineage in British history and politics. It stretches back long into the seventeenth century, not just to Locke’s Second Treatises of Government, but prior to that with the period of the English Civil War, or more accurately the English Revolution. The work of the republican poet John Milton is of note in this regard, as is the democratic radicalism of the Levellers, who agitated for individual liberties, equality before the law, popular sovereignty and inalienable rights.

 

            Republican liberalism was present within the British Liberal Party. The late Victorian MP, Charles Dilke is a good example of this, as is the party’s twentieth century economic platform of ‘ownership for all’. The party of Jo Grimond advocated for the spread of wealth, asset ownership and industrial democracy throughout society, advancing a republican conception of economic citizenship. This notion would be developed further with James Meade’s concept of property-owning democracy, which itself became Rawls’ ideal version of a just society. Aspects of republican liberalism can be seen as late as 1989 in Citizens’ Britain, written by the first leader of the (Social and) Liberal Democrats, Paddy Ashdown.

 

            A brief note on why I am referring to republican liberalism and not liberal republicanism. This is because the main object of my personal political focus are the rights and liberties of the individual within a political and economic system based on republican principles. As opposed to the object being a republican society itself (complete with commitments to virtue, the common good and liberty as non-domination), which also respects individual rights and liberties. This may be an epistemological point, but nevertheless an important one to clarify.

 

            Liberalism and republicanism have been central to the development of progressive politics and contemporary liberal democracy. Their ideas have transformed the world. Together their ideas hold out the prospect for a radical, free and egalitarian society. In particular, they would add greater intellectual weight to contemporary calls for a universal basic income in the wake of the coronavirus crisis. In a world where the progressive left is scrambling to find a viable alternative to neoliberal hegemony, they could do far worse than rediscovering the radicalism of the republican liberal political tradition.

 

Bibliography

Ashdown, Paddy (1989) Citizens’ Britain: A Radical Agenda for the 1990s. London: Fourth Estate Limited.

Locke, John (1980) Second Treatise of Government. Indianapolis; Hackett Publishing Company, Inc.

O’ Neill, Martin and Williamson Thad (2012) Property-Owning Democracy: Rawls and Beyond. Chichester and Oxford: Wiley-Blackwell.

Pettit, Philip (1997) Republicanism: A Theory of Freedom and Government. Oxford: Oxford University Press. 

Rawls, John (1999) A Theory of Justice. Cambridge, Massachusetts; The Belknap Press of Harvard University Press.

Rees, John (2017) The Leveller Revolution. London: Verso.

            Rosenblatt, Helen (2018) The Lost History of Liberalism. Princeton: Princeton University Press.

            Sen, Amartya (2010) The Idea of Justice. London: Penguin Books Ltd.

            White, Stuart (2014) “Alternative liberal solutions to economic inequality”: https://www.opendemocracy.net/en/opendemocracyuk/alternative-liberal-solutions-to-economic-inequality/. Accessed: 23/05/2020.