Gary Gerstle on the Neoliberal Political Order: An Elite Promise of a World of Freedom and Emancipation (Part II)

In this extended conversation with RevDem editor Ferenc Laczó published in two parts, Gary Gerstle discusses key questions tackled in his new The Rise and Fall of the Neoliberal Order: America and the World in the Free Market Era.

In Part II, Gerstle discusses opposed moral perspectives and their compatibility with the neoliberal political order; why the neoliberal order used the coercive power of the state to incarcerate millions; and the ways in which we can observe the retreat of neoliberal hegemony today.

Part I covered Gerstle’s interpretation of the longue durée history of liberalism; his encompassing approach to the study of political orders; how the neoliberal order became hegemonic in the US; and why the Soviet Union is crucial to the history of the US. It can be read here.

Gary Gerstle is Paul Mellon Professor of American History Emeritus and Paul Mellon Director of Research in American History at Cambridge University, where he is also a Fellow of Sidney Sussex College. He is a fellow of the British Academy and of the Royal Historical Society. He has written extensively about immigration, race, and nationality, with a particular focus on how Americans have constituted and reconstituted themselves as a nation and the ways in which immigration and race have disrupted and reinforced that process. He has also studied the history of American political thought, institutions, and conflicts, and maintains a longstanding interest in questions of class and class formation.

Gary Gerstle’s best-known books include the co-edited The Rise and Fall of the New Deal Order, 1930-1980 (1989), which he has followed up with the co-edited volume Beyond the New Deal Order (2019), Liberty and Coercion: The Paradox of American Government from the Founding to the Present (2015), American Crucible: Race and Nation in the Twentieth Century (2017, updated edition) and the co-edited volume A Cultural History of Democracy in the Modern Age (2021). The Rise and Fall of the Neoliberal Order: America and the World in the Free Market Era published this month, April 2022.

Ferenc Laczó: I found it highly stimulating how you argue that the neo-Victorian morality propagated by the Republicans and the professed cosmopolitanism of the Democrats were both eminently compatible with neoliberalism; that cultural polarization went hand in hand with broad agreement on questions of political economy. In what ways can both be reconciled with neoliberalism? How do you view the role or function of cultural polarization under the neoliberal order?

Gary Gerstle: Many people only see cultural polarization in the United States, so this may be a controversial point with readers. I believe there are moral dimensions to political order. By moral dimension, I mean the way in which a political party or movement conveys its story about “the good life” and how to achieve it. Ultimately, such a story must possess a moral component.

During the era of the neoliberal order, Republicans worried about market excess. Yes, markets freed the individual to pursue his ambition and talent, but that same individual might be felled by temptation to spend more than he earned in the pursuit of too much immediate gratification. How to ensure that an individual would resist temptation and become a responsible member of society? The New Deal’s state-centred answer to that question was to regulate the economy by limiting what markets can do and to distribute enough welfare to individuals to make sure they can sustain a decent life. That kind of policy, however, was (and is) anathema to free-market Republicans. They insisted instead that success in a market economy would arise not from state-imposed discipline but from self-discipline: avoiding debt, resisting temptation, monetary and sexual, aspiring to live the virtuous life. The best way to acquire the necessary discipline was through “wholesome” family life—a family understood as traditional, patriarchal, and God-fearing. The roles for the father and mother would be clearly defined, with the former holding down a good job and the latter devoting herself to caring for her husband and raising her children. Such family conditions would lay a foundation for discipline and virtue among family members; those qualities would then move out from the family into society at large.

I call this family formation neo-Victorian because it was thought to have flourished in 19th-century England, under the rule of Queen Victoria. The most out-front figures in terms of advocating for such an approach in the 1980s and 1990s were historians like Gertrude Himmelfarb who studied 19th-century Victorian Britain. Himmelfarb was also very prominent in politics, married to Irving Kristol, the editor of The Public Interest, an important conservative-neoliberal journal. Her ideas echoed in mass movements such as Jerry Falwell’s Moral Majority. These neo-Victorians were opposed to heterodox family formations—ones formed around single parent, feminist, and/or gay principles.

The opposite moral code, what I call cosmopolitan, is very different. In a sense, it embraces the market in a way that resonates with left-leaning individuals. Part of what a market society promises is that you can be anyone you want to be. It does not matter what family you were born into, or in which country or religion or race; it does not matter whether you are gay or straight or what gender was assigned to you at birth. The global world of exchange promised by neoliberalism was associated with the free movement of people, a flow that inevitably exposes individuals from one part of the world to the lives and experiences of people from other parts of the world. Such exposure gives individuals access to a plethora of communities, lifestyles, and identities, many of which would not have been accessible before. Such movement can encourage individuals to seek out new identities, and new and often hybridized ways of living. Neoliberalism allows these sorts of yearnings to flourish.

Its promise of liberation from inheritance or other forms of constraint draws into its world all sorts of people. Neoliberalism is as compatible with this cosmopolitan world as it is with the patriarchal nuclear family. Both sustained the neoliberal order.

But the coexistence of such different moral codes was always uneasy, and dependent on neoliberalism delivering on its promise of material abundance and affluence. Were neoliberalism to begin to fail as an economic program, then the profound differences between these two worldviews would come into sharper focus and conflict. We indeed see the conflict sharpening in the wake of the economic crash of 2008 and 2009, when many economic promises of neoliberalism went up in smoke; cultural antagonisms deepened measurably in the subsequent decade.

You insist that the construction of the neoliberal order implied the denial of liberty to those supposedly unable to handle its privileges and responsibilities, with mass incarceration spiking while the US military has been built up even further. Was mass incarceration a blatant self-contradiction or perhaps a logical, if highly problematic feature of the neoliberal order?

I would like to answer that it is both a self-contradiction and a logical feature of the neoliberal order. The historical moment my book focuses on is also the moment of mass incarceration in America, reaching its peak in the 1990s and 2000s – precisely when the neoliberal order was also at its peak. How can a neoliberal order promising freedom coexist with such a massive program of denying freedom to millions through incarceration?

My answer begins, once again, with classical liberalism; many of its enthusiasts worried whether every sort of person could handle the freedom that it was promising. The answer, for most classical liberals, was no. Children couldn’t, of course, nor could women, who were denied the vote in America for 130 years after America proclaimed itself a liberal republic, and equal rights for much longer. Slavery was written into the Constitution of this liberal republic; even after emancipation, Black people did not gain equal rights, or saw them rolled back after the brief experiment with equal rights—what is known in America as Reconstruction—ended. By the early 20th century, both the US and Britain, two countries that often defined themselves as liberal, had become empires, in which rights that were extended to citizens of the metropole were often denied to those living in the colonies. Race and gender, in other words, remained key markers of unfreedom for a long part of liberalism’s history. Many liberals, of course, fought to remove conditions of unfreedom imposed on those of different races and on women. But the tradition within liberalism of circumscribing who would be allowed to participate fully in the liberal polity and have full rights within it lingered.

When America was hit by racial conflict verging on insurrection in the ‘60s and ‘70s, the question that classical liberals posed returned to the fore: were some people incapable of handling freedom? Many white Americans answered that question affirmatively, which became a justification for locking up huge numbers of individuals, a population that was disproportionately minority.

It was as if America’s liberal republic was saying that liberalism, here defined as a society given over to market freedom and prizing individual rights, could only operate successfully once significant numbers within that society had their market freedom and individual rights stripped away. Once again, race became a marker of unfreedom.

Notwithstanding this logic, a contradiction loomed in removing so many people from the freedom to engage in market life. How long can you sequester large numbers of Americans in prison without damaging America’s reputation as a free and open society? This is the question that increasing numbers of Americas began to ask in the second decade of the twenty-first century; new protest movements around this issue arose, thus weakening the hold that neoliberalism had on the country.

The closing chapter of your book is simply titled “The End.” You write about the contestations and the chaos accompanying the decline of the neoliberal order. In what ways has the neoliberal order waned and in what ways is it being reproduced today?

I would distinguish between neoliberalism and the neoliberal order being over, for I think what is ending is the neoliberal order, meaning the ability of neoliberal ideas and policies to be hegemonic. Various neoliberal ideas will survive and continue to influence politics and society.

One way of measuring the decline of the neoliberal order is to examine what I sometimes call the four freedoms promised by neoliberalism. These are not Roosevelt’s four freedoms of the 1940s but something else: namely, the free movement of goods, the free movement of people, the free movement of information, and the free movement of capital.

At its height, the neoliberal order promised to move goods to every corner of the globe, to allow people to move from one place to another with only minor restrictions, to give individuals access to the entire world through a little computer screen, and to allow capital to move freely and instantaneously from country to country in an unending search for profit. This dream was bound up, of course, with neoliberalism succeeding as a globalizating project.

Each of these freedoms now seems to be in retreat. Ten years ago, protectionism was a dirty word. It no longer is. Both Donald Trump and Bernie Sanders legitimated protectionist philosophies in ways unacceptable during the neoliberal heyday. The free movement of people is under challenge in ways it was not during the neoliberal heyday – an issue which Europe is struggling with mightily. Today various countries are trying to create their own sealed information-technology systems – we see this most clearly with China and Russia, but Turkey and India are trying to do something similar. The aspiring autocrats who rule these societies believe that they cannot maintain power in a society where information is free, and thus they have to find ways to control it.

In fact, we are confronted with the possibility that, in five or ten years, the world will be living not as one world of information but in four or five different information blocs.

The last freedom to be eroded, I believe, has been the free movement of capital. But look at what the Russian invasion of Ukraine has unleashed. The sanctions levied on Russia involve an extraordinary degree of restraint, not just on trade, information, and people, but also on the movement of capital.

We do not know how the Russia-Ukraine war is going to end, of course, but, in its wake, it is becoming harder and harder to imagine a return to the hyper-globalized and hyper-capitalized world of the 1990s and 2000s.

The Ukraine crisis may be accelerating trends already underway, an indication that we are moving into another era.

Elements of neoliberalism will survive—deregulation as a policy impulse, the financialization of the economy, the influence of neoliberal modes of reason, something Wendy Brown has written trenchantly about. But the ability of neoliberalism to constitute a political order is on the wane. Whether we are entering an extended period of disorder or whether a new political order, its contours (though still hard to discern) arising around us as we speak, is one of the most pressing questions of the 2020s.

The transcript has been edited for length and clarity.

In collaboration with Giancarlo Grignaschi.

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