By Ben Cohen
Milton Friedman (1912-2006) is the God Father of ‘neo liberal economics’, the modern day version of capitalism. According to The Economist, Friedman “was the most influential economist of the second half of the 20th century…possibly of all of it.”
Back in the 1950’s, Friedman essentially spawned the concept that government intervention in an economy was a bad thing, and for an economy to function properly, the ‘market’ was best left to itself. “I am in favor of cutting taxes under any circumstances and for any excuse, for any reason, whenever it’s possible,” said Friedman.”Underlying most arguments against the free market is a lack of belief in freedom itself”, he would say, unwavering in his belief of the purity of capitalism.
Government spending bred dependency, Friedman argued, and things like social security and socialised medical care were viewed with deep suspicion.
Friedman’s brand of economics was tested via the help of the CIA on several Latin American countries during the 70’s and 80’s, and the Chicago University professor has been credited with ‘freeing’ them from the ills of socialism.
An economic advisor to Richard Nixon, and an unofficial advisor to Ronald Reagan, Friedman’s influence was far reaching in government circles. He inspired the radical changes in economic policy in America and Britain during the 1980’s, and his philosophy is being applied in full to this day.
It is now abundantly apparent that this experiment has failed miserably.
Far from saving Latin America, Friedman’s economic reforms have literally destroyed the countries where it was applied. In Brazil for example, the national debt increased 64% between the years 1980-1985. It doubled again from 1998-2000. Despite having the 9th largest economy in the world, it is amongst the leading in inequality and pervasive poverty. Around 25% of the population live under the official poverty line. In Nicaragua, another poster child for neoliberal reform, 1 out of 3 children currently suffer from chronic malnutrition, and it continues to be one of the poorest countries in the region.
According to Naomi Klein, before the neoliberal revolution in Argentina in 1976, the country had ‘fewer people living in poverty than France or the U.S-just 9%- and an unemployment rate of only 4.2%’. A year after the junta seized power, ‘real wages lost 40% of their value, factories closed’, and ‘poverty spiraled’.
The U.S and the U.K are also shining examples of the failures of Neo Liberalism. Both countries are bottom of the league when it comes to social mobility in industrialised nations. They have the highest poverty rates and least economic equality amongst societies of similar wealth. In the U.K, around 22% of the population live in poverty, twice that of Sweden’s. There are also 36.5 million Americans living in poverty. The real value of wages has declined for the average American since the 60’s, while the top earners have seen massive increases.
The doctrine of free market capitalism has been relentlessly rammed down our throats as the solution to all our problems. But in reality, it is the cause.
When we hear politicians talk about giving business’s tax breaks, it really means more money will be sucked up to the rich. When they say that raising the minimum wage will ‘hurt the economy’, what they mean is that it will hurt the rich. When they talk about ‘flexible labour’ they mean cheap, expendable wage slavery for the benefit of the rich.
Neoliberalism seeks to absolve everyone of their responsibilities to our fellow human beings. Friedman once said, “What you should do, in my opinion, is to give every person who now has a claim on Social Security bonds equal to the value of his claim, and set him free. Let him save. Let him do what he wants with it.”
When asked how he would stop people making bad investment decisions, the esteemed economist replied, “I don’t! Why should I?”
And that sums up the neo conservative view of people. Why should anyone care if a family made a bad investment decision and is out on the streets? Why should anyone care whether a poor child has a decent education? To Friedman and his minions, this is ‘real freedom’.
To people of conscience, this is barbaric.
Humans are by nature a collective species, and can survive only in groups. Neoliberalism works on the principle that this is untrue. It says we can survive as autonomous consumers. It says that ‘greed is good’ and selfishness ‘drives productivity’. A small percentage of the population has benefited from this world view, while the majority have not. Through extensive marketing and PR, we have been led to believe this is the only way. Ridiculous books like ‘The End Of History’ by Francis Fukayama have implanted the idea that the pure market is the goal of humanity.
It is not.
We must fight this system that impoverishes so many and separates us from our fellow citizens. It is time for this horrible experiment to finally come to an end.
Ben Cohen is the editor and founder of The Daily Banter. He lives in Washington DC where he does podcasts, teaches Martial Arts, and tries to be a good father. He would be extremely disturbed if you took him too seriously.