Neoliberals Friedrich Hayek and Milton Friedman invented new "self-organizing capitalism"

Friedrich Hayek and Milton Friedman

Neoliberals.

The creation of value has become the main focus of new capitalism, not just its old spirit of sacrifice through work and the pursuit of accumulating capital. The new virtue and moral revolution of capitalism, according to libertarian doctrine, is to establish the moral right of the individual to live for their own sake.

In this, the profit motive plays a central role. The interaction between buyers and sellers creates a price system, and prices communicate people’s urgent and unmet needs.

The relationship with the state has divided perceptions of capitalism. Libertarian capitalists only want a minimal state to maintain order and establish basic contract-based rules.

Today, the hardline "liberals" who oppose state machinery are either "neoliberals" (focusing on the economy) or "libertarians" (focusing on individual rights). Their aversion to the state and their value conservatism fundamentally separates them from social liberals.

Professor Heikki Patomäki has defined neoliberalism as a doctrine that frames and interprets societal problems through market thinking and ideals of efficiency, freedom, and justice.

A neoliberal believes that problems, as interpreted in this way, can be solved by creating space for self-regulating competitive markets. Markets require private ownership and commodification. Things must be brought under private ownership and turned into commodities.

The American neoliberal movement has given economic theory to the religious Trumpist right and the Tea Party movement, supporting their efforts to not only conquer the Republican Party but the entire intellectual landscape of the United States.

This battle is paralyzing the entire country.

In 2016, Donald Trump, a unique conservative populist, came to power with the support of this movement. The possibility of Trump’s return in 2024 would again turn back the clock.

The doctrine of today's world order’s intellectual fathers, the neoliberals, is to shift decision-making and activities that belong to the nation-state to the business domain and the supranational level through new public management.

The reason is clear: in reality, the modern nation-state was created by low- and middle-income people to defend their own interests.

This became costly for the capitalist, with all the social and wage costs – even women’s wages.

For half a century, the pursuit of welfare and equality has been the central role of the nation-state – no longer fighting wars. It has so far been the only way to guarantee high-quality healthcare, education, and social services for the entire population.

This is the case in both poor and wealthy countries.

The neoliberal attack on the state is an attempt to turn public services into markets.

The state is no longer a mere apparatus of violence measured by war, but the exercise of power is much more influential on the human mind, more controlling and more severe.

Competition between nations and large corporations often results in outcomes similar to those of competition by arms – that is, war.

In the thinking of classical neoliberals, societal problems are solved by expanding property rights and, consequently, private markets. The state should not interfere in private activities except by producing neutral laws for people’s actions, allowing the market-mediated preferences of citizens to guide societal development.

In practice, this idea is rooted in the application of economic thinking to everything. The entire human reality is to be explained through one truth.

Neoliberalism has led to the concentration of income.

Ten percent of people own 86 percent of the world’s wealth, meaning that the wealth of the 85 richest families equals that of the poorest 3.5 billion people.

We have reached a historical turning point in Europe as well, where the distinction between the private and public sectors is beginning to disappear. The development of both sectors is increasingly driven by the logic of private enterprise.

The great question of our time is whether the private and public sectors can operate under the same logic and whether the logic tied to economic thinking can be expanded to encompass all human activity.

According to Hayek, there is no middle ground between an unregulated market economy and socialism. Any concession to socialism was a slide toward totalitarianism. Society is not a fixed organization but a spontaneous market economy, where the state is necessary but largely an external factor.

For Hayek, the welfare state was a restriction on individual freedom, containing the seed of totalitarianism. As a result, talk of the welfare state has in many places already shifted to talk of a "competition state."

In fairness, it must be remembered that Hayek and Milton Friedman wrote their texts during the Cold War, believing that the battle between capitalism and socialism would continue for a long time.

However, this shows that neoliberalism, rooted in supply-side economics, also has a political vision – an ideology tied to (American) spheres of influence.

Hayek’s idea of an unregulated market economy has been countered by John Gray, who criticizes neo- or neoliberalism.

According to John Gray the central concern for people is not income growth but ensuring their own security. The most important part of this is a stable job

Gray considers the global market economy to be a utopian idea.

Its result is only a growing tendency toward increasingly severe social conflicts and political instability.

Gray sees the global economy as a threat to European liberal civilization because it destroys the entire established work system with part-time, precarious jobs.

In supply-side economics or neoliberalism, new forms of irregular employment and gig work have emerged, as labor, according to the doctrine, must compete in the labor supply market at lower wages.