Neoliberalism: The Ideology Blocking Our Collective Economic Power

Most are familiar with the hallmarks of the midterms season — and now that the 2022 elections are close at hand, we’ve all settled into the familiar barrage of text messages from strangers. Whether you’re getting a series of texts from a celebrity like Martin Sheen or a random one-off from a woman named Jesse, these notes share strong opinions on which issues are most important, what’s at stake this year, and how we should vote. However, most people already hold firmly rooted beliefs on at least the first two: their #1 issue and what’s really at risk for them and their families.

Research shows that, akin to a popularized early ‘90s political phrase, “it’s the economy, stupid.” Economic issues are not only perennial, but will be central to this year’s elections. People are thinking a lot about having enough — be it to cover the stubbornly high gas prices or ever-expensive produce at the grocery store. And if people are going to vote based on the economy, they should understand what that vote stands for — and who it could stand against.

There's an important undercurrent of our economic pains that candidates on both sides of the ballot will avoid bringing up. On the left, most will shy away from connecting the hot-button and fallen-out-of-favor issue of structural racism with economic hardship. On the right, many will argue that a focus on racial equity issues is a distraction from economic ones. Yet we might make different choices as consumers and voters if we’re willing to make the connection between our own household-level economic woes and American capitalism’s slavery-inspired low-road approach.

American capitalism has been around for ages, while neoliberalism, a free and unadulterated market’s champion, came in vogue after WWII following backlash against socialism. The guiding idea was that only free markets could allocate resources fairly and reward individuals based on “what they deserve” — their contribution to the economy. By the 1980s, the ideology had leapt from universities into politics, and spread widely. Privatization of almost everything followed the logic that corporations could do most things better than the government. A growing cultural acceptance followed — a “greed-is-good” embrace of profit-driven corporate interests and wealth-driven individual interests. And that wonky term became and remains an invisible hand, really more like a thumb, on the scale of opportunity for elites.

Reactions to recent debates — like the outcry over who did and didn’t receive stimulus checks during COVID shutdowns, race-conscious college admissions, student loan forgiveness, and certain incentives for first-time home-buyers, among others — demonstrate how this widespread, internalized ideology drives much of the failure to address what makes it hard for many in the United States to thrive economically. The associated public rhetoric betrays the prevalence of a “why them?” mentality in these economic debates. And race is baked into this rhetoric. Arguments that suggest helping the poor messes with the market or that something not properly means-tested will be disastrous? Those have racial undertones, too. Those who make these pronouncements often avoid the specter of racism even when their ideas are not so far removed from more explicitly racist takes.

The structure of the American economy highly values individualism: that is, if you fail to succeed, it’s your fault. Because individualism and individual responsibility are prized, failure to succeed is considered an individual act. In actuality, it reflects a system failure. Or rather, a system that is working as intended to keep certain people in power while pinning fault to individuals, and masquerading the whole process as neutrality. It’s a narrative ready-made for the “haves.” And the onus on the individual — to either succeed or fail solely by their own doing — is a deception with far-reaching uptake.

This thinking helps the rich persuade themselves that they acquired their wealth through merit, ignoring advantages like privilege, inheritance (social capital and actual capital), favorable tax codes, and class. The other side of the coin is that those in poverty may be likely to blame themselves for their “failures.” Perhaps many, if not most, along the spectrum of economic vibrance are aware of the set-up. However, even with that knowledge, aspects of what has been ingrained still pit individual against individual, drawing focus toward scarcity, a sort of musical chairs of secure jobs, resources, and common everyday needs.

To trace the line back to our capitalist origins, you have to “start on the plantation,’’ as social scientist Matthew Desmond writes, with the economic gifts bestowed on the white ruling class through slavery. By some estimates, slaveholders extracted what would now be worth more than $14 trillion worth of labor from their captives. And the gifts kept giving with the post-slavery enactment of “Black Codes” and poverty laws that incarcerated violators (for jay-walking, loitering), returning free labor to southern slave owners. Racism continued to restrain Black economic progress for decades, including after World War II.

“We might make different choices … if we’re willing to make the connection between our own household-level economic woes and American capitalism’s slavery-inspired low-road approach.”

While growth of the middle class was being fueled by the Servicemen's Readjustment Act of 1944, also known as the GI Bill, Black veterans were largely denied this educational opportunity. “Redlining,” the process by which Black Americans and other people of color were shut out of home ownership, was yet another way of gatekeeping one of the most common avenues for accumulating wealth. While today, Black, Asian, and Hispanic or Latina/o people comprise 36 percent of the U.S. workforce, these workers make up 58 percent of agricultural workers; 70 percent of maids and house cleaners; and 74 percent of baggage porters, bellhops, and concierges. Slavery and Jim Crow greatly devalued these types of work, and the legacy of these institutions continues to inform the American economic system and its outcomes. The impact is intergenerational and makes clear that neither the markets nor the structure of the political economy enable “getting out what one puts into the economy.” This is a case where neoliberalism’s answers don’t answer.

We can’t separate the economic conversation from the racial equity one. Luckily, some of today’s brightest thought leaders who consider the economy are hungry to talk about the racism baked into the system. I had the chance to speak with a few before the summer’s start. At an intimate leadership dinner, Dorian Warren, Co-President of Community Change and Co-Chair of the Economic Security Project, explained, “You can’t talk about the role of government or the role of public goods without talking about racism. It’s kind of malpractice.” Too often the racial element “is relegated to the periphery, when it needs to be more central,” Darrick Hamilton of The New School noted. He added, “We are to believe that [this ideology] is cleansing, rewarding good behavior and sanctioning sloth. That it is colorblind, inevitable, natural, and efficient.” But it’s not. As Hamilton succinctly put: “What it so often is, is un-interrogated.”

And Lindsay Owens, head of the Groundwork Collaborative, mentioned the importance of exploring the racism woven within policy in order to “get at the undoing.”

Elections are rife with slights of hand and smoke and mirrors, making it hard for people to see clearly which candidate hopeful is truly aligned to their best interests. If they all suggest that they will advocate on your behalf and safeguard the public good, why is there so much heat and strife over that representation? In relation to the economy, it has a lot to do with “who gets what” and ideas around deservedness. Where some see pragmatism in the current structure of the political economy, there are deep imprints of neoliberalism and its racial rhetoric.

If we’re willing to make the connection between the racism embedded into the foundation of the economy and our household-level struggles — our true voter issues — we can attempt to make different choices. Yet those choices require clarity and understanding: The lack of which explains the stunning and depressing statistics from scholars Cheryl Boudreau, Christopher S. Elmendorf, and Scott A. MacKenzie, who found that low-information voters didn’t vote in alignment with their desired issues areas, while high-information voters did.

We must be thoughtful about the stories we tell ourselves and each other about why the economy does or doesn’t work for everyone, and those stories can’t omit race. Our economic interests are interwoven. No matter what your proximity to wealth may be, every one of us can and should recognize that talking about a painful past doesn’t make one culpable. In calling out systems that set up barriers, we can also “call in” those who enjoy impediment-free progress in the economy. And we position them to be modern-day economic allies. This is what keeps the past from being prologue. This is where the importance lies in exploring what civic muscles can be built as voters and consumers to tackle economic injustice. Noting, not ignoring, is what allows us to claim not “the” economy, but “our” economy and to chart a new collective economic course.

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