Both the quality and the quantity of recent historical scholarship on neoliberalism have increased markedly over the past five years. The Road from Mont Pelerin (Harvard, 2009), edited by Philip Mirowski and Dieter Plehwe, Constructions of Neoliberal Reason (Oxford, 2010) by Jamie Peck and The Great Persuasion (Harvard, 2013) by Angus Burgin have performed a valuable service, in tracing the intellectual genesis of neoliberal thought over the course of the twentieth century. The global financial crisis of the early 21st century has posed the question of neoliberalism’s identity, rationality and authority anew, which no doubt partly explains this recent upturn in detailed historical work on the topic.
Nicholas Gane’s recent article, ‘The Emergence of Neoliberalism: Thinking Through and Beyond Michel Foucault’s Lectures on Biopolitics’, represents another important addition to this body of work, which shifts our focus back to the pre-War roots of neoliberal thinking, and the concern of early neoliberals to distance themselves from the ghost of John Stuart Mill. The impetus for this piece, as the title suggests, is Foucault’s own genealogy of neoliberal thought, published as The Birth of Biopolitics (Palgrave, 2008), which consists of a brilliant if somewhat jumbled series of lectures given in 1978-79. The belated English publication of these lectures represents a landmark in our understanding of neoliberalism; but as Gane notes, it also leaves some significant gaps in the story.
Foucault’s lectures focus on various things. The German ordoliberal tradition receives the most attention, followed by the Chicago School of economics. They also jump around to consider classical liberalism, the genealogy of ‘homo economicus’ and the emergence of an 18th century ‘civil society’. Inevitably, there are holes in his account. Gane’s concern is with one particular omission, which he believes is a critical one: the role of Ludwig von Mises and Friedrich von Hayek between 1920 and 1945, in shaping the subsequent neoliberal tradition.
As Gane shows, many distinctly neoliberal concerns and problems can be traced back far earlier than many accounts would have it, to Mises’s attacks on socialism in the early 1920s, and his re-articulation of liberal values a few years later. The primacy of property rights and the expansion of economic rationality to the social domain are present in Mises’s work, well before the Chicago School would argue for these things. Meanwhile, the central elements of ordoliberalism – primarily the requirement for the state to uphold competition at all costs – can be seen in Hayek’s work, before and after the War. Hence, Gane argues, the originality that Foucault accords to ordoliberals and Chicago neoliberals may be exaggerated.
In turn, Gane argues, this requires us to rethink what was the ‘liberalism’ that the neoliberals were seeking to rescue or update. As Gane explores, Mises and (less explicitly) Hayek were appalled by the mutation of liberalism that occurred in the work of Mill. By the end of his career, Mill was arguing for the socialization of production, via forms of worker ownership. Given his status as the unquestioned giant of English political economy through the mid-19th century, this was a significant development. As far as Mises was concerned, Mill offered clear evidence that classical liberalism had ceased to be liberal at all. Neoliberalism required a fresh start, built out of the resources of post-1870 economics and sociology.
As Gane notes, Mill is entirely absent from Foucault’s genealogy of liberalism and neoliberalism, another significant omission. Foucault’s focus upon Jeremy Bentham, as the iconic theorist of liberal government, seems out of step with how the neoliberals understood their own inheritance. Once the true status of Mill is understood, Gane argues, so also is the starting point and critical inspiration of neoliberalism.
Gane’s article concludes by making the case for the contemporary urgency of this type of historical excavation. Following Foucault, he argues for a richer understanding of the rationalities that govern us today, in terms of their origins, accidental mutations and contexts. But while Gane is undoubtedly correct to stress the pre-history of (for example) the post-War Mont Pelerin Society, I am not entirely convinced that these early critical explorations created all that much imprint on the forms of economic government of the late 20th and early 21st century. This is not to say that they are not fascinating and important, but that they may not be quite as significant for a ‘history of the present’ as I think Gane believes. Partly this comes down to a question of how one wishes to understand the history and politics of ideas.
To defend Foucault’s own genealogy for a moment, there is very compelling evidence that German ordoliberalism and Chicago School economics have provided rationalities that have found their way into various state agencies and strategies over the past sixty years. It is worth remembering that Foucault is a historian of social technologies, material practices, codified routines and texts, and not necessarily of ideas as such. It is scarcely surprising that he dedicates so much attention to ordoliberalism, when that was the single domain of neoliberal thought that had achieved the status of a performative state rationality (in the post-War German state and European Commission) at the time of Foucault’s lectures.
Foucault’s analysis of the Chicago School, meanwhile, is brilliantly prescient. Monetarism (based on Milton Friedman’s ideas) had only recently entered policy thinking at the time of Foucault’s lectures. But the idea of ‘human capital’, stemming from Gary Becker’s work (also explored by Foucault), would only reveal its full governmental and calculative implications in the years after Foucault’s death. (On which note, this video of Becker discussing Foucault’s analysis is fascinating).
Gane is thoroughly convincing in his demonstration of the debt that the ordoliberals and Chicago economists owe to their Austrian forbears of the 1920s and 30s. Yet it is hard to see evidence of specifically Misean or Hayekian state rationalities over the past forty years (Schumpeterian rationalities would be a different matter). One of the reasons why Mises and Hayek continue to command such adoration in many libertarian and conservative circles is precisely because their followers believe they have never really been adopted by the state. While it is true, as Mirowski has argued, that Hayek can be credited with turning the question of liberalism into a question of epistemology, one wonders what sort of constructive, active, modernizing policy programme could be extracted from Mises or Hayek’s work.
In turn, the status of Mill is also, to my mind, more ambiguous than Gane makes out. Mill’s absence from Foucauldian genealogies of liberalism and neoliberalism is indeed curious – but perhaps it reflects something real. Again, what would a Millian governmental rationality or programme look like? Where Jevons, for example, performed a crucial role in re-building market rationality upon Benthamite, psychological foundations (without which, there’d have been no Gary Becker), what exactly was Mill’s political and sociological significance, beyond his unrivalled authority and fame within Victorian political economy during his own lifetime? Gane poses the question very effectively. But I’m not convinced that he answers it in this paper.
There is no right and wrong way to carry out Foucauldian historical research (so maybe we should drop the term ‘Foucauldian’ altogether). Gane has provided us with a compelling and authoritative account, which seeks to unsettle an emerging orthodoxy about the neoliberal intellectual tradition. We can continue to debate exactly what ‘neoliberalism’ means, a debate which is entangled in the question of where precisely its origins lie. I would argue that we should look closer to the state itself, its experts, its imported rationalities, than to the history of economics as such. This is a bone of contention. But Gane’s paper is another essential contribution to the history (and critique) of a particular style of economic thinking, which continues to dominate us today.
Will Davies, University of Warwick
Nicholas Gane’s ‘The Emergence of Neoliberalism: Thinking Through and Beyond Michel Foucault’s Lectures on Biopolitics’:
Nicholas Gane’s ‘Review Article: Trajectories of Liberalism and Neoliberalism’:
William Davies’s ‘When is a market not a market?: ‘Exemption’, ‘Externality’ and ‘Exception’ in the case of European State Aid rules’:
You may also be interested in reading more about William Davies’s forthcoming TCS Book ‘The Limits of Neoliberalism: Authority, Sovereignty and the Logic of Competition’