During the late 1970s and the beginning of the 1980s, neo-liberalism first emerged as a reaction to the worldwide recession, and is associated with the retrenchment and privatization of the welfare state. The main aspects of neo-liberalism can be explained in terms of open, competitive, and unregulated markets; a liberated state in terms of all its forms. Based on this general view and expectation about neo-liberalism, William Davies discusses the limitations of neo-liberalism in relation to authority, sovereignty and competition, with attention to the key role of politics and the market.
The Limits of Neoliberalism is well-organized and includes contributions from some key scholars (i.e., Hayek, Coase and Schumpeter), as well as interviews and policy documents to discuss the history of competition in order to better examine the transformation and current situation of neo-liberalism in the U.S., the UK, and the EU, with special attention to the 2007-2008 financial crisis. In the first chapter, Davies defines neo-liberalism as the “disenchantment of politics by economics” (p. 6). Based on this view, he discussed value, ideology, authority, and justification in terms of economic efficiency. The quantitative results of the economy become more important than the qualitative. The results of this chapter show that everything converts to a form of market in contemporary life due to neo-liberal policies. He suggests that we “will one day live in a society which offers more choices than merely ‘winning’ or ‘losing’ in a competitive game” (p. viii), and he believes we are extremely close to this situation.
According to Davies, the market is not completely unregulated; it has its own policies, and has battled with politics throughout the history of neo-liberalism. To understand market power, he focusses on the Chicago School to exemplify monopoly and competition in the current market. He claims that while neo-liberalism has changed over time between the 1980s and 2000s, the first time neo-liberalism lost was in the recent financial crisis (2007-2008), after which its concepts began to decline. Davies notes that neo-liberalism is like a “zombie” (p. 187); he effectively ‘kills’ neo-liberalism gradually with each additional chapter of his book using existing academic sources in chronological order. Moreover, as Davies mentions briefly at the beginning of his book, Brexit and Donald Trump have emerged as the last signs of anti-neo-liberal popular movements in the UK and the U.S.
However, these two recent cases contradict Davies’s premise. He declines to discuss these two recent political incidents in detail, preferring only to highlight them at the beginning of his book. Yet, as David Harvey notes, “the neo-liberal state needs nationalism of a certain sort to survive.”1 Brexit clearly reveals that the British want to create their own free and competitive market without having to depend on the European Union. In other words, this example shows that neo-liberalism is still alive, at least in the case of the UK, in terms of nationalism.
Another significant criticism is that Davies compares and gives examples from the UK, the U.S., and Europe. However, he makes a general assumption about these countries in terms of progress and the results of neo-liberalism. However, different countries take different paths toward neo-liberalism, and neo-liberalism serves diverse functions (i.e. to support class power or state policy).2 It is difficult to claim that all the members of the European Union or states in Europe are in the same situation and point of progress concerning neo-liberalism. Furthermore, neo-liberalism is not a unique situation, nor a process that could be considered completed for these countries. In addition, based on their various cultural and national situations, different countries in different parts of the world (i.e., Turkey, China, Japan, and Brazil) experience neo-liberalism in different ways, such as having a free market, greater or lesser state control, etc.
Additionally, while making such a generalization is dubious in terms of its application to different countries, it is also difficult to make a general assumption for any specific country. As the example of Brexit shows, different parts of the UK had different views on this matter. For instance, while Scotland supported remaining in the EU by a margin of over 50 percent to 60 percent, the rest of the UK, especially the south of England, expressed a preference to leave the EU with margins of over 50 percent. It is also difficult to claim that all people in the same region had the same reaction to neo-liberalism or were affected by neo-liberalism to the same extent. For instance, while the numbers of homeowners are decreasing both in the north and south of England, the number of tenancies and second homeowners have been increasing since 2004. The meaning of the term ‘free market’ is different for different people, even in the same country or neighborhood. In light of these examples, it is difficult to categorize countries in terms of neo-liberalism within the contemporary world. In other words, whilst the impact of neo-liberalism is clearly different in different countries, it is not even possible to claim that the citizens of a given country or region are affected to a similar extent by neo-liberalism.
Lastly, while the recent edition of The Limits of Neoliberalism is not significantly different from the previous edition, it is a significant book by which to gain an understanding of neo-liberalism in the context of the U.S. and the UK as the first neo-liberal countries. In addition, its broader literature review and well-organized chapters make this book a useful tool with which to understand daily life, politics, and market life within the neo-liberal environment. Furthermore, this book might form a useful basis from which to consider and criticize in the future in terms of post-neo-liberalism.
- David Harvey, A Brief History of Neoliberalism, (Oxford: Oxford University Press, 2005), p. 85.
- Jennifer Robinson, “2010: Urban Geography Plenary Lecture The Travels of Urban Neoliberalism: Taking Stock of the Internationalization of Urban Theory,” Urban Geography, Vol. 32, No. 8 (2013), pp. 1087-1109.