Neoliberalism is primarily considered an economic logic which promotes ideals of ‘free trade’, and reduces the role of government to a facilitator of deregulation and privatisation. But accompanying the economics has always been a particular worldview or ideology, and neoliberalism in fact relies on a whole social system of support and legitimation.
In his new book, Neoliberalism’s Demons, theologian and social theorist Adam Kotsko considers neoliberalism as a form of political theology, to understand how it functions in societies not only as a mode of economics, but also politically and culturally as a moral order. In this interview, I discuss with him some of the core ideas in the book.
Adam Kotsko teaches in the Shimer Great Books School of North Central College. He is the author, most recently, of Neoliberalism’s Demons (Stanford University, 2018) and The Prince of This World (Stanford University, 2016), and the translator of many works by Giorgio Agamben. Visit his professional site for more information about his work, including links to articles and interviews.
In your book, you approach neoliberalism from the perspective of political theology. What does political theology bring to the analysis of neoliberalism?
Adam Kotsko: Political theology has meant many things since the term was coined in the early 1920s by the German jurist Carl Schmitt, and so I was aware going into this project that I was at the risk of trying to explain the unknown by the unknown. In the book, I try to define the term in a way that is faithful to the intentions of earlier political theologians like Schmitt, while also making it more broadly useful. Ultimately, I view political theology as the study of the structures and sources of legitimacy – of the ways that people attempt to answer the question of who should be in charge and why.
A lot of times, people think of political theology as a discipline that points out parallels between theological and political structures – for instance, the sovereignty of the executive branch bears comparison with the sovereignty of God – but I think that the focus on legitimacy allows us to account for why those parallels exist: namely, because both the theological and the political orders are asking for our trust, for our faith. Neoliberalism is no exception to that, though most analyses of neoliberalism as a system do no foreground those questions of how the system legitimates itself.
You stress that neoliberalism is not merely ‘a formula for economic policy’ but a ‘holistic worldview’ that goes beyond previous models of capitalism. What are the key facets of this worldview? How do they differ from the familiar libertarian ideology that focuses on reducing the influence of the state?
AK: The key to the neoliberal worldview is freedom – but in the very narrow sense of being free to participate in competitive markets. This view of freedom does entail a certain kind of scepticism about the state, but not only the state. Unions, for instance, are very questionable within the neoliberal worldview, because they restrain the individual’s right to compete for a favourable contract on their own individual merits. The issue isn’t about ‘the state’ vs. ‘the economy,’ but about making sure that no collective agency can arise that interferes with individualistic market competition.
Neoliberals do rely on libertarian rhetoric, but libertarianism is basically neoliberalism for fools. When neoliberals are talking amongst themselves, they always acknowledge that a strong state is absolutely necessary to their agenda. This is because markets do not spontaneously arise in the absence of state interference, or in other words, markets are not natural. They must be artificially constructed, and so one way of defining neoliberalism is as a project to use state power to cultivate or create markets so that people will be forced to be free in the neoliberal sense.
And that agenda has been very effective, because the competitive market provides the model for ever more areas of our lives. On social media, we are constantly competing for attention and prestige, and we can even measure that directly through ‘likes’ and retweets. And this is how we spend our free time! In the workplace, I think all of us are accustomed to thinking in zero-sum ways. Even when it comes time to solve social problems, neoliberals instinctively try to create a market – whether we’re talking about cap-and-trade policies to reduce carbon emissions or Obamacare’s attempt to expand health care coverage by forcing people to purchase insurance in a private market. From the neoliberal perspective, this is all the greatest possible embodiment of freedom, and they try their very best to make sure that no other alternative view is able to gain traction.
In political theological terms, you emphasise how neoliberalism ‘demonizes’ us, or blames individuals and populations for social problems. What is unique about the neoliberal form of demonization? How important is this concept to the neoliberal moral order?
AK: In the research for my previous book, The Prince of This World, I came up with my own particular definition of demonization, based on my understanding of the theological tradition. We are all familiar with the idea of ‘demonizing’ someone in the sense of casting them as evil, etc. What I add to that is an element of entrapment. That is to say, in my study of the theological sources, it seemed to me that God passive-aggressively creates demons by putting them in a situation where he knows they will rebel against them, then blaming them for it. The key here is the element of choice – even though their choices were artificially constrained, they did choose to do what they did, and hence they are morally responsible for it.
I see this kind of entrapment everywhere in the neoliberal order. In my own field of academia, I think of how we tell students that college is the only path to a liveable life, leading them to ‘freely choose’ to take on impossible debt loads that they can never escape. We recognize that an injustice has happened here, but a lot of people find it hard to resist saying, essentially, ‘Well, you should have thought of that before you took out the loans….’ They chose it, therefore they should bear the consequences.
And that is one of the least sinister cases – for instance, think about how blacks are entrapped into criminality and then punished disproportionately. Again, we recognize an injustice, but in the mainstream discourse the instinctive reaction is: ‘Well, they had a choice.’ Under neoliberalism, our free choice doesn’t exist to give us room for creativity and exploration – we can seemingly only ever choose wrongly. Free will is a means to generate blameworthiness, to tell us that we deserve what we get.
In discussing the bailout of the banks by the government during the 2008 financial crisis, you say that, ‘far from a contradiction [in neoliberalism], a financial sector bailout is precisely the duty of the neoliberal state as ultimate guarantor of market structures’. Yet, according to the moral order of neoliberalism, it may well seem wrong to save the banks from their mistakes. Does this suggest a contradiction between the economic needs of neoliberalism and its moral discourse, or tell us something about the limits of demonization?
AK: What’s interesting to me is how sympathetic neoliberal ideologues are to the idea of social constraints when it comes to the wealthy and powerful. An 18-year-old should be able to fully anticipate their income and ability to handle a certain debt load, even when they’ve never had a full-time job or had to support themselves at all, but millionaire bankers are viewed as pure tools of market forces.
When people read the title of my book, they often assume that I’m demonizing neoliberal politicians or financiers – and to be clear, I do think they are horrible, horrible people. But I think that using the rhetoric of individual demonization against them winds up feeding into the same framework by which neoliberalism entraps all of us. The problem isn’t that investment bankers are assholes, though they are. The problem is a system that rewards such assholes.
In terms of the bailout as such, yes, businesses generally should be allowed to fail according to neoliberal ideology, but the financial sector has always had a special status in neoliberal regimes. Finance is not just one sector among others – it is the meta-market, the market that guarantees the existence of all other markets, and therefore it has always had a close relationship to the state. There’s the famous quote from Hank Paulson that if they didn’t do the bailouts, there wouldn’t be an economy anymore, and though Hank Paulson is – of course, obviously! – a horrible person and totally in hock to Goldman Sachs, he was not wrong. In the system neoliberalism has set up, the bailout was the only answer.
And if bailouts are a contradiction to neoliberalism, they never got the memo, because finance-sector bailouts have always been part of the neoliberal playbook. Pointing out that bailouts violate simplistic libertarianism seems to be very satisfying for many commentators, but it does not provide much insight into the way the system actually operates. Again, the problem isn’t that neoliberal policy makers are being hypocritical or inconsistent or corrupt in authorizing bailouts – the problem is a system that genuinely does make bailouts the only answer in a serious crisis.
What is the relationship between neoliberalism and neoconservative ideology? Does neoliberalism rely on right-wing cultural discourses for its legitimacy? And has that ideology now mutated, for example in the politics of the Tea Party or Trump, in a way that is anti-neoliberal?
AK: Neoliberalism and neoconservatism are often held to be somehow in conflict, yet as with bailouts, it seems that the neoliberals themselves never got the memo. Neoliberalism and neoconservatism have gone hand-in-hand from the very beginning. When centre-left parties took up the neoliberal mantle in the 1990s and 2000s, we were clearly dealing with the more conservative wings of those parties. Both Bill Clinton and Tony Blair were significantly to the right of previous candidates.
The difference is often one of attitude rather than substance – Republicans openly desire to brutalize (non-white) criminals and immigrants, while Democrats reluctantly concede that those who wish to brutalize (non-white) criminals and immigrants have legitimate concerns… Both parties rely, in different ways, on racial paranoia to legitimate their attack on the welfare state and their reinforcement of the prison-industrial complex.
The Tea Party and Trump take that racial paranoia much more literally than before and seek to act on it, but what is interesting to me is that they continue to act according to neoliberal standards. Trump isn’t trying to restore the fortunes of the Rust Belt by directly employing people in infrastructure, for instance, but through an attempt to increase American global competitiveness with his tariff program. That program is incoherent and unlikely to succeed, but the deviation from neoliberal ‘best practices’ should not distract us from the fact that the program he is pursuing is deeply neoliberal in form. In the book, I claim that Trump is not anti-neoliberal, but a kind of parody of neoliberalism, exaggerating all its worst features.
To what extent are racism and sexism intrinsic to the political theology of neoliberalism? How does the emphasis on pluralism in many aspects of neoliberalized culture fit in with the need to maintain relatively traditional family dynamics and scapegoat oppressed minorities?
AK: The neoliberal obsession with ‘best practices’ definitely extends to family life and racial politics. One reason for the mostly seamless alliance between neoliberals and neoconservatives is that relying on the market is a hugely efficient way to ensure conformism in family life and preserve the racial hierarchy. On the family front, a decline in the public safety net means an increased reliance on the private safety net of the family.
People view it as somehow weird, for instance, that millennials are living with their parents longer and generally much closer to them and more dependent on them (as in ‘helicopter parenting’), but all the economic incentives point in that direction. In a world where there was ample public support for higher education and more generous welfare provision, it would be easier for young people to be independent of their parents – and that was exactly what neoliberal thinkers recognized and feared.
Similarly, state employment has traditionally been one of the main ways blacks achieved upward mobility, and so decimating the public sphere is a remarkably efficient way to keep them ‘in their place.’ The reliance on private power, as expressed in the market, replaces forms of public, collective power that could have disrupted – and indeed, as Melinda Cooper reminds us in Family Values, by the mid-1970s really were beginning to disrupt – traditional power structures. The triumph of the boss, the father, and the white man are all best served by a system that does not allow any concentrations of power elsewhere.
Nonetheless, neoliberalism does have its more cosmopolitan and inclusive side – but it is a very superficial inclusion. Some conservative neoliberals are happy to welcome women and minorities into the elite if they succeed on meritocratic terms, but the opportunities they grant to exceptional individuals do not extend to the rest of their community. As we vividly saw with the wave of police shootings during Obama’s second term, having a black person in the White House did not materially improve the status of black people more generally. And as for the multiculturalism of the neoliberal order, it is also superficial – more or less the multiculturalism of the food court. Genuine multicultural exchange would require serious engagement with questions of justice and value, which the neoliberal order tries to avoid at all costs.
In the book, you reiterate William Davies’s categorisation of three phases of neoliberalism, starting with the ‘combative’ stage of the late 1970s and 1980s, which secured the hegemonic status of neoliberalism, then the ‘normative’ stage of the 1990s and early 2000s that continued to legitimise it, and finally a ‘punitive’ stage that has emerged since the financial crisis of 2008. How has the moral order changed in this current punitive stage, given that people’s acceptance of the social order may now be more ‘negative’, or resigned to a deeply unfair system and a perceived lack of alternatives?
AK: I think that to understand the history of neoliberalism, we need to recognize that in the earlier stages, neoliberalism did manage to keep at least some of its promises. In the 1980s, neoliberalism really did overcome stagflation and deliver some economic growth. In the 90s, it really did bring about possibilities for upward mobility and technological innovation, along with a more cosmopolitan outlook. Neoliberalism made a lot of false promises, too, and the things it did deliver were inferior to the experience in the post-war era, but at least it had something to point to.
Under what Davies calls punitive neoliberalism, they have basically stopped making promises in the first place. At one point, I summarized Clinton’s campaign approach as saying to the American people, ‘I’m not going to patronize you by claiming that things could ever get better than this.’ It’s all punishment with no promise of release or redemption – in other words, a living hell. In that context, you can understand the appeal of Trump’s crazy lies, because at least he recognizes that people want things.
As it turned out, the voters preferred Clinton to Trump, showing that resignation still maintains some degree of legitimacy, and the installation of Trump contrary to the democratic will of the people has been an absolute disaster for the legitimacy of the system. It may have been difficult to find a way to avoid inaugurating Trump under the U.S. system, but I think the fact that the Democrats basically handed over the keys without a fight shows that they have a punitive attitude: the voters chose wrong, and now they deserve the punishment of Trump. Maybe next time they’ll make better choices.
You explain that democracy is an essential part of neoliberalism, as, ‘on the deepest level, neoliberalism relies on consent for its legitimacy’. At the same time, neoliberal systems tend to demand technocratic expertise, which is at risk of disruption when exposed to the whims of the people. To what extent is democracy a weakness of neoliberalism?
AK: The neoliberal approach to democracy fits with the general strategy of entrapment: they give us just enough democracy to be able to say that we chose neoliberalism, but not enough to actually overturn it. If you look back over the neoliberal era, only Reagan commanded really strong majorities – which made sense, because he was trying to change the previous system to a neoliberal one. Once neoliberalism was firmly established, however, we saw the emergence of very narrow election results, with both parties presenting fundamentally similar programs. Obama is the only U.S. president since Bush Sr. to get more than 51% of the popular vote – a result that was pretty mediocre in previous eras.
There’s a reason we’ve had two Electoral College flukes in as many decades after a century with none, and it’s because the neoliberal strategy is intentionally to ‘eke out’ a narrow victory in order to avoid having a strong mandate for change. And under our system, very close elections can sometimes go to the loser rather than the winner – a result for which the ‘people’ are still blamed in mainstream discourse.
In terms of technocratic rule, I think it’s telling that the only alternative that has been allowed to arise is precisely the buffoonish brutality of Trump. If the people must be given a real choice between two options, it must be a forced choice – a choice between having a government and having a total shitshow. Yes, the American people chose the competent choice, though not enthusiastically enough for it to matter. And now many centrist liberals are more or less openly fantasizing about a coup, or some other outcome where the unelected bureaucrats somehow ‘take down’ Trump. When push comes to shove, neoliberals are willing to ditch democracy – but in this case, push came to shove in a way that they didn’t expect, so they were caught off guard.
One aspect of neoliberalism you don’t cover in the book is its relationship to consumerism. As I see it, an important part of neoliberalism is that it channels our self-interest not only into competitive instrumentalism but also self-indulgence. In this sense, the psychology of demonization makes us feel as guilty for not experiencing enough pleasure or owning ‘must-have’ goods as it does for getting into debt, not working hard enough, or neglecting family relationships. We could even see the pressure to consume as a kind of devilish temptation, which promotes decadence and permissiveness, but also makes a sense of personal failure inevitable, as we cannot both fulfil this demand and maintain our other responsibilities. Would you agree with this? How do you view the role of consumerism in the political theology of neoliberalism?
AK: This makes me think of the way that millennials are demonized for choosing avocado toast rather than homeownership. Of course, the very premise of this is absurd, because avocado toast is a small indulgence and homeownership is a massive undertaking – but it is part of the way that our consumer choices are wielded against us.
I think this is clearest with issues like environmentalism. Environmentally destructive products are cheaper and much more widely available than a more sustainable alternative, but the fact that people ‘freely choose’ the destructive product is taken as evidence that people don’t really care about climate change and that any concerted action to combat it would be tyrannical. My question is: why is the destructive choice available at all? Why present people with an option that is self-destructive?
Neoliberalism is great at entrapping us into the choices that it wants us to make, so why not ‘nudge’ us harder here? The answer, of course, is that environmental issues are inherently collective in nature, and preventing the emergence of collective agency contrary to the interests of capital is priority number one for neoliberal public policy.
You explain that neoliberalism is fragile, despite its dominance, especially in ‘its ruthless exploitation of the future as a means of propping up the present’, which seems destined for catastrophe. But there is also the question of challenging neoliberalism by developing a properly anti-neoliberal politics in the present. One problem you mention here is that neoliberalism retains an intrinsic appeal because it ‘relieves us of collective responsibility – with all the political conflict and struggle that meaningful collective action brings with it.’ You also highlight a need to break with the logic of the market itself. What kind of politics, or political theology, may be required to reinvigorate a sense of collective responsibility that challenges the market?
AK: I don’t have a step-by-step program for how we should proceed to escape neoliberalism. The more I study it, the more self-reinforcing it becomes, even as it becomes more self-destructive – hence, for instance, the fact that the bailouts required by failures of neoliberalism only increase the concentration of power in the financial system and tighten restraints on government spending. And the political disempowerment that neoliberalism’s play-acting democracy has created leads to a fatalism and passivity that serve neoliberal ends.
After spending a whole book talking about the way that neoliberalism uses personal responsibility to entrap us, I am convinced that we now need to find mechanisms to create collective responsibility – not in the sense that ‘we’ are to blame for Trump (despite the majority of us not voting for him and actively hating him) or that ‘we’ are to blame for climate change (despite a system that offers us few options aside from a carbon-intensive, car-based lifestyle). That kind of blame is illusory: ‘we’ are not the kind of entity that can be morally responsible, because ‘we’ don’t have any real capacity for collective deliberation and decision-making.
My hope is that we could find a way to genuinely be a ‘we’, to become the kind of collective agent that could be responsible for our collective fate – and to do that, yes, we need to severely restrict the sphere of the market. Humanity has been outsourcing its decisions to the impersonal mechanism of the market for far too long, and it’s time to grow up, stop believing in fairy tales about the invisible hand, and take responsibility for our own collective destiny. What that would mean in practice is something that we can’t fully know beforehand, but I think we’ll know it if and when we see it.