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106-486: The Independent Grassroots Party was a moderate , democratic socialist political third party in the U.S. state of Minnesota created in 1996 to oppose drug prohibition . The party shared many of the progressive values of the Farmer-Labor Party but with an emphasis on cannabis / hemp legalization issues. Some political scholars have speculated that Minnesota's marijuana political parties are responsible for

212-477: A shock therapy , which rapidly transformed Chile from an economy with a protected market and strong government intervention into a liberalized, world-integrated economy, where market forces were left free to guide most of the economy's decisions. Inflation was tempered, falling from over 600% in 1974, to below 50% by 1979, to below 10% right before the economic crisis of 1982 ; GDP growth spiked (see chart) to 10%. however, inequality widened as wages and benefits to

318-479: A "political spectrum" point of view, the variations for instance, conservatism , who tend to be defined in the same way toward being resistant with the idea of future changes, is not always the case. In parallel, liberalism , as to The Liberal Party of Canada could also include different versions to quantify, or "weight" the possible outcomes of the most distant paramount. For example, Canadians citizens are protected by law, and free of action or speech, defined by

424-415: A "slowly unfolding economic disaster" and bequeathed to the world increased inequalities, societal divisions, economic misery and a lack of meaningful politics. The Great Depression in the 1930s, which severely decreased economic output throughout the world and produced high unemployment and widespread poverty , was widely regarded as a failure of economic liberalism . To renew the damaged ideology,

530-613: A centrist political movement from modern American liberalism in the 1970s. According to political commentator David Brooks , prominent neoliberal politicians included Al Gore and Bill Clinton of the Democratic Party of the United States. The neoliberals coalesced around two magazines, The New Republic and the Washington Monthly , and often supported Third Way policies. The "godfather" of this version of neoliberalism

636-441: A certain set of economic beliefs. The colloquium defined the concept of neoliberalism as involving "the priority of the price mechanism, free enterprise, the system of competition, and a strong and impartial state". According to attendees Louis Rougier and Friedrich Hayek , the competition of neoliberalism would establish an elite structure of successful individuals that would assume power in society, with these elites replacing

742-507: A civilian-military regime. Shortly after the inauguration of Fujimori, his government received a $ 715 million grant from United States Agency for International Development (USAID) on 29 September 1990 for the Policy Analysis, Planning and Implementation Project (PAPI) that was developed "to support economic policy reform in the country". De Soto proved to be influential to Fujimori, who began to repeat de Soto's advocacy for deregulating

848-415: A drop in the real salary of the working class. They also liberalized trade policy so that foreign goods could freely enter the country. Argentina's industry, which had been on the rise for 20 years after the economic policies of former president Arturo Frondizi , rapidly declined as it was not able to compete with foreign goods. Following the measures, there was an increase in poverty from 9% in 1975 to 40% at

954-426: A global 'free market'. Naomi Klein states that the three policy pillars of neoliberalism are " privatization of the public sphere, deregulation of the corporate sector, and the lowering of income and corporate taxes , paid for with cuts to public spending ". According to some scholars, neoliberalism is commonly used as a pejorative by critics, outpacing similar terms such as monetarism , neoconservatism ,

1060-438: A government-appointed commission that ensured Pinochet would remain as president for a further eight years—with increased powers—after which he would face a re-election referendum. The Chicago Boys were given significant political influence within the military dictatorship , and they implemented sweeping economic reform . In contrast to the extensive nationalization and centrally planned economic programs supported by Allende,

1166-578: A group of 25 liberal intellectuals, including a number of prominent academics and journalists like Walter Lippmann , Friedrich Hayek , Ludwig von Mises , Wilhelm Röpke , Alexander Rüstow , and Louis Rougier , organized the Walter Lippmann Colloquium , named in honor of Lippmann to celebrate the publication of the French translation of Lippmann's pro- market book An Inquiry into the Principles of

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1272-680: A new constitution to replace the Pinochet-era constitution, which entrenched certain neoliberal principles into the country's basic law, won with 78% of the vote. However, in September 2022 , the referendum to approve a rewritten the constitution was rejected with 61% of the vote. Peruvian economist Hernando de Soto , the founder of one of the first neoliberal organizations in Latin America, Institute for Liberty and Democracy (ILD), began to receive assistance from Ronald Reagan 's administration, with

1378-526: A number of reasons: pragmatic, ideological, or otherwise; however, the number of people that vote for centrist political parties is a statistical anomaly, in part due to the entrenched nature of the country's two-party system . Notes Bibliography Neoliberalism Neoliberalism is both a political philosophy and a term used to signify the late-20th-century political reappearance of 19th-century ideas associated with free-market capitalism . The term has multiple, competing definitions, and

1484-628: A philosophy that was more moderate than entirely Laissez-faire free-market capitalism and favored using state policy to temper social inequality and counter a tendency towards monopoly. In 1976, the military dictatorship 's economic plan led by José Alfredo Martínez de Hoz was the first attempt at establishing a neoliberal program in Argentina. They implemented a fiscal austerity plan that reduced money printing in an attempt to counter inflation. In order to achieve this, salaries were frozen; however, they were unable to reduce inflation, which led to

1590-671: A reduction in the rate of inflation , though Peru's poverty rate remained largely unchanged with over half of the population living in poverty in 1998. According to the Foundation for Economic Education , USAID, the United Nations Population Fund (UNFPA) and the Nippon Foundation also supported the sterilization efforts of the Fujimori government. E. Liagin reported that from 1993 to 1998, USAID "basically took charge of

1696-444: Is broadly defined as the extension of competitive markets into all areas of life, including the economy , politics and society . The Handbook of Neoliberalism Neoliberalism is contemporarily used to refer to market-oriented reform policies such as "eliminating price controls , deregulating capital markets , lowering trade barriers " and reducing, especially through privatization and austerity , state influence in

1802-491: Is considered a moderate wing. The current LDP has conflicts between moderate patriotist and extreme nationalist supporters. The Democratic Socialist Party (DSP) was formed by a group of politicians who splintered off of the Japan Socialist Party (JSP) in 1960. The party advocated a moderate social-democratic politics and supported the U.S.-Japan Alliance . The party started to slowly support neoliberalism from

1908-461: Is distinct from liberalism insofar as it does not advocate laissez-faire economic policy, but instead is highly constructivist and advocates a strong state to bring about market-like reforms in every aspect of society. Anthropologist Jason Hickel also rejects the notion that neoliberalism necessitates the retreat of the state in favor of totally free markets, arguing that the spread of neoliberalism required substantial state intervention to establish

2014-715: Is near the Latin American average, Chile still has one of the highest Gini coefficients in the OECD , an organization of mostly developed countries that includes Chile but not most other Latin American countries. Furthermore, the Gini coefficient measures only income inequality ; Chile has more mixed inequality ratings in the OECD's Better Life Index , which includes indexes for more factors than only income, like housing and education . Additionally,

2120-451: Is often used pejoratively. In scholarly use, the term is often left undefined or used to describe a multitude of phenomena. However, it is primarily employed to delineate the societal transformation resulting from market-based reforms. Neoliberalism is an economic philosophy that originated among European liberal scholars during the 1930s. It emerged as a response to the perceived decline in popularity of classical liberalism , which

2226-646: The Asia-Pacific , the Middle East , and China implementing significant neoliberal reform. Additionally, the International Monetary Fund and World Bank encouraged neoliberal reforms in many developing countries by placing reform requirements on loans, in a process known as structural adjustment . Neoliberal ideas were first implemented in West Germany . The economists around Ludwig Erhard drew on

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2332-577: The Canadian Charter of Rights , and from that same consideration, one, must not surpass or challenge to act against that same charter. From there we should perceive that even inside the epicenter of a "liberal mechanism" or political parties, in many cases there are still forms of hierarchical, composable or modular sets of rules or policies as basics threshold. Moreover, political moderate, aim to be scrupulous during an individual said state of affairs, resolving with actual information's or data, to determine

2438-506: The Great Recession . In sum, the neoliberal policies of the 1980s and 1990s—initiated by a repressive authoritarian government —transformed the Chilean economy from a protected market with high barriers to trade and hefty government intervention into one of the world's most open free-market economies. Chile experienced the worst economic bust of any Latin American country during

2544-586: The Latin American debt crisis (several years into neoliberal reform), but also had one of the most robust recoveries, rising from the poorest Latin American country in terms of GDP per capita in 1980 (along with Peru) to the richest in 2019. Average annual economic growth from the mid-1980s to the Asian crisis in 1997 was 7.2%, 3.5% between 1998 and 2005, and growth in per capita real income from 1985 to 1996 averaged 5%—all outpacing Latin American averages. Inflation

2650-459: The National Endowment for Democracy 's Center for International Private Enterprise (CIPE) providing his ILD with funding. The economic policy of President Alan García distanced Peru from international markets, resulting in lower foreign investment in the country. Under García, Peru experienced hyperinflation and increased confrontations with the guerrilla group Shining Path , leading

2756-529: The United States , the Chilean armed forces and national police overthrew the Allende government in a coup d'état . They established a repressive military junta , known for its violent suppression of opposition , and appointed army chief Augusto Pinochet Supreme Head of the nation. His rule was later given legal legitimacy through a controversial 1980 plebiscite , which approved a new constitution drafted by

2862-586: The Washington Consensus and "market reform" in much scholarly writing. The Handbook of Neoliberalism , for instance, posits that the term has "become a means of identifying a seemingly ubiquitous set of market-oriented policies as being largely responsible for a wide range of social, political, ecological and economic problems". Its use in this manner has been criticized by those who advocate for policies characterized as neoliberal. The Handbook , for example, further argues that "such lack of specificity [for

2968-505: The economic policy of classical liberalism. In the context of policymaking, the term neoliberalism is often used to describe a paradigm shift that followed the failure of the post-war consensus and neo-Keynesian economics to address the stagflation of the 1970s. The collapse of the USSR and the end of the Cold War also facilitated the rise of neoliberalism in the United States and around

3074-657: The "clearest repudiation of the country's establishment". In the 1960s, Latin American intellectuals began to notice the ideas of ordoliberalism ; they often used the Spanish term "neoliberalismo" to refer to this school of thought. They were particularly impressed by the social market economy and the Wirtschaftswunder ("economic miracle") in Germany and speculated about the possibility of accomplishing similar policies in their own countries. Neoliberalism in 1960s Argentina meant

3180-490: The 1980s, "have contributed to steady economic growth in Chile and have more than halved poverty rates," and some scholars have even called the period the " Miracle of Chile ". Other scholars have called it a failure that led to extreme inequalities in the distribution of income and resulted in severe socioeconomic damage. It is also contested how much these changes were the result of neoliberal economic policies and how much they were

3286-724: The 1980s, and was disbanded in 1994. Moderate social-democrats of the JSP formed the Democratic Party of Japan (DPJ) with conservative-liberal Sakigake and other moderates of the LDP. Most of the DPJ's mainstream factions moved to the Constitutional Democratic Party of Japan (CDP), but the former DPJ's right-wing moved to the Democratic Party for the People after 2019. In recent years,

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3392-500: The 1990s, Chile maintained high growth, averaging 7.3% from 1990 to 1998. Eduardo Aninat, writing for the IMF journal Finance & Development , called the period from 1986 to 2000 "the longest, strongest, and most stable period of growth in [Chile's] history." In 1999, there was a brief recession brought about by the Asian financial crisis , with growth resuming in 2000 and remaining near 5% until

3498-561: The Chicago Boys implemented rapid and extensive privatization of state enterprises, deregulation, and significant reductions in trade barriers during the latter half of the 1970s. In 1978, policies that would further reduce the role of the state and infuse competition and individualism into areas such as labor relations, pensions, health and education were introduced. > Additionally, the central bank raised interest rates from 49.9% to 178% to counter high inflation. These policies amounted to

3604-481: The English-language study of political economy. According to one study of 148 scholarly articles, neoliberalism is almost never defined but used in several senses to describe ideology, economic theory, development theory, or economic reform policy. It has become used largely as a term of abuse and/or to imply a laissez-faire market fundamentalism virtually identical to that of classical liberalism – rather than

3710-561: The German neoliberals, his name was only occasionally mentioned in conjunction with neoliberalism during this period due to his more pro-free market stance. During the military rule under Augusto Pinochet (1973–1990) in Chile, opposition scholars took up the expression to describe the economic reforms implemented there and its proponents (the Chicago Boys ). Once this new meaning was established among Spanish-speaking scholars, it diffused into

3816-728: The Good Society . Meeting in Paris in August 1938, they called for a new liberal project, with "neoliberalism" one name floated for the fledgling movement. They further agreed to develop the Colloquium into a permanent think tank based in Paris called the Centre International d'Études pour la Rénovation du Libéralisme. While most agreed that the status quo liberalism promoting laissez-faire economics had failed, deep disagreements arose around

3922-470: The Great Depression while Mises denounced the other faction, complaining that the ordoliberalism they advocated really meant "ordo-interventionism". Divided in opinion and short on funding, the Colloquium was mostly ineffectual; related attempts to further neoliberal ideas, such as the effort by Colloque-attendee Wilhelm Röpke to establish a journal of neoliberal ideas, mostly floundered. Fatefully,

4028-522: The Italian economist Maffeo Pantaleoni , with the term néo-libéralisme previously existing in French; the term was later used by others, including the classical liberal economist Milton Friedman in his 1951 essay "Neo-Liberalism and its Prospects". In 1938 at the Colloque Walter Lippmann , the term neoliberalism was proposed, among other terms, and ultimately chosen to be used to describe

4134-726: The Minnesota Grassroots Party split, forming the Independent Grassroots party. John Birrenbach was the Independent Grassroots presidential candidate and George McMahon was the vice-presidential candidate. Dan Vacek was the Independent Grassroots candidate for United States Representative (Minnesota District 4). In 1998, members of the Independent Grassroots Party established the Legal Marijuana Now political party. Moderate politician At

4240-584: The Peruvian economy. Under Fujimori, de Soto served as "the President's personal representative", with The New York Times describing de Soto as an "overseas salesman", while others dubbed de Soto as the "informal president" for Fujimori. In a recommendation to Fujimori, de Soto called for a "shock" to Peru's economy. The policies included a 300% tax increase, unregulated prices and privatizing two-hundred and fifty state-owned entities. The policies of de Soto led to

4346-626: The benefits are concentrated in Lima." In 2020, the COVID-19 pandemic in Peru compounded these disparities, with political scientist Professor Farid Kahhat of the Pontifical Catholic University of Peru stating that, "market reforms in Peru have yielded positive results in terms of reducing poverty ... But what the pandemic has laid bare, particularly in Peru, is that poverty was reduced while leaving

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4452-434: The best scenario possible, within the available choices, at that moment in time. Japan's right-wing Liberal Democratic Party (LDP) has traditionally been divided into two main factions: the based on bureaucratic "conservative mainstream" (保守本流) and the hawkish nationalist "conservative anti-mainstream" (保守傍流). Among them, "conservative mainstream" is also considered a moderate wing within the LDP. The LDP's faction Kōchikai

4558-474: The classical liberal notion that competition drives economic prosperity. However, they argued that a laissez-faire state policy stifles competition, as the strong devour the weak since monopolies and cartels could pose a threat to freedom of competition. They supported the creation of a well-developed legal system and capable regulatory apparatus. While still opposed to full-scale Keynesian employment policies or an extensive welfare state , German neoliberal theory

4664-479: The country towards high levels of instability. The Peruvian armed forces grew frustrated with the inability of the García administration to handle the nation's crises and began to draft an operation – Plan Verde – to overthrow his government. The military's Plan Verde involved the " total extermination " of impoverished and indigenous Peruvians perceived as a drain on the economy, the control or censorship of media in

4770-447: The developed world was under threat from collectivist trends, which they outlined in their statement of aims: The central values of civilization are in danger. Over large stretches of the Earth's surface the essential conditions of human dignity and freedom have already disappeared. In others, they are under constant menace from the development of current tendencies of policy. The position of

4876-444: The earliest nations to implement neoliberal reform. Marxist economic geographer David Harvey has described the substantial neoliberal reforms in Chile beginning in the 1970s as "the first experiment with neoliberal state formation", which would provide "helpful evidence to support the subsequent turn to neoliberalism in both Britain... and the United States." Similarly, Vincent Bevins says that Chile under Augusto Pinochet "became

4982-550: The early 1970s. After several years of socialist economic policies under president Salvador Allende , a 1973 coup d'état , which established a military junta under dictator Augusto Pinochet , led to the implementation of a number of sweeping neoliberal economic reforms that had been proposed by the Chicago Boys , a group of Chilean economists educated under Milton Friedman . This "neoliberal project" served as "the first experiment with neoliberal state formation" and provided an example for neoliberal reforms elsewhere. Beginning in

5088-564: The early 1980s, the Reagan administration and Thatcher government implemented a series of neoliberal economic reforms to counter the chronic stagflation the United States and United Kingdom had each experienced throughout the 1970s. Neoliberal policies continued to dominate American and British politics until the Great Recession . Following British and American reform, neoliberal policies were exported abroad, with countries in Latin America ,

5194-513: The economy. It is also commonly associated with the economic policies introduced by Margaret Thatcher in the United Kingdom and Ronald Reagan in the United States. Some scholars note it has a number of distinct usages in different spheres: There is debate over the meaning of the term. Sociologists Fred L. Block and Margaret Somers claim there is a dispute over what to call the influence of free-market ideas which have been used to justify

5300-550: The economy. It would not be until a succession of economic downturns and crises in the 1970s that neoliberal policy proposals would be widely implemented. By this time, neoliberal thought had evolved. The early neoliberal ideas of the Mont Pelerin Society had sought to chart a middle way between the trend of increasing government intervention implemented after the Great Depression and the laissez-faire economics many in

5406-431: The efforts of the Colloquium would be overwhelmed by the outbreak of World War II and were largely forgotten. Nonetheless, the Colloquium served as the first meeting of the nascent neoliberal movement and would serve as the precursor to the Mont Pelerin Society , a far more successful effort created after the war by many of those who had been present at the Colloquium. Neoliberalism began accelerating in importance with

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5512-445: The epicenter of the community as Europeans dominated the leadership roles. Established during a time when central planning was in the ascendancy worldwide and there were few avenues for neoliberals to influence policymakers, the society became a "rallying point" for neoliberals, as Milton Friedman phrased it, bringing together isolated advocates of liberalism and capitalism . They were united in their belief that individual freedom in

5618-472: The establishment of the Mont Pelerin Society in 1947, whose founding members included Friedrich Hayek , Milton Friedman , Karl Popper , George Stigler and Ludwig von Mises . Meeting annually, it became a "kind of international 'who's who' of the classical liberal and neo-liberal intellectuals." While the first conference in 1947 was almost half American, the Europeans dominated by 1951. Europe would remain

5724-577: The existing representative democracy acting on the behalf of the majority. To be neoliberal meant advocating a modern economic policy with state intervention . Neoliberal state interventionism brought a clash with the opposing laissez-faire camp of classical liberals, like Ludwig von Mises . Most scholars in the 1950s and 1960s understood neoliberalism as referring to the social market economy and its principal economic theorists such as Walter Eucken , Wilhelm Röpke , Alexander Rüstow and Alfred Müller-Armack . Although Hayek had intellectual ties to

5830-684: The federal level in Canada as of 2024, there are five active political parties who have seats in the House of Commons , for which most of them have a wide range of goals and political opinions, that differ between each others. Per definition, where "political moderate" is used, in a specific context to being far conservative, the Conservative Party of Canada could be used as a representation. However, we can now see that those beliefs might contain "inverted" or different effects-opinions. If we could measure them from

5936-645: The former seeks to disrupt and overcome any institutions which stand in the way. Radhika Desai, director of the Geopolitical Economy Research Group at the University of Manitoba , argues that global capitalism reached its peak in 1914, just prior to the two great wars, anti-capitalist revolutions and Keynesian reforms, and the purpose of neoliberalism was to restore capitalism to the preeminence it once enjoyed. She argues that this process has failed as contemporary neoliberal capitalism has fostered

6042-429: The fringes of Chilean economic and political thought for a number of years, as the presidency of Salvador Allende (1970–1973) brought about a socialist reorientation of the economy. During the Allende presidency, Chile experienced a severe economic crisis, in which inflation peaked near 150%. Following an extended period of social unrest and political tension, as well as diplomatic, economic, and covert pressure from

6148-481: The gloves off", goes on to assert that the term was largely unknown by the general public in 1998, particularly in the United States . Lester Spence uses the term to critique trends in Black politics, defining neoliberalism as "the general idea that society works best when the people and the institutions within it work or are shaped to work according to market principles". According to Philip Mirowski , neoliberalism views

6254-437: The government, which was received with disapproval by Fujimori. USAID would go on to assist the Fujimori government with rewriting the 1993 Peruvian constitution, with the agency concluding in 1997 that it helped with the "preparation of legislative texts" and "contributed to the emergence of a private sector advisory role". The policies promoted by de Soto and implemented by Fujimori eventually caused macroeconomic stability and

6360-438: The growth of a view of history which denies all absolute moral standards and by the growth of theories which question the desirability of the rule of law. It holds further that they have been fostered by a decline of belief in private property and the competitive market...[This group's] object is solely, by facilitating the exchange of views among minds inspired by certain ideals and broad conceptions held in common, to contribute to

6466-450: The high interest rates of the period which—while stabilizing inflation—hampered investment and contributed to widespread bankruptcy in the banking industry. Other scholars fault governmental departures from the neoliberal agenda ; for instance, the government pegged the Chilean peso to the US dollar, against the wishes of the Chicago Boys, which economists believe led to an overvalued peso. After

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6572-421: The idea that the word is nothing more than a political slur, or a term without any analytic power". Gary Gerstle argues that neoliberalism is a legitimate term, and describes it as "a creed that calls explicitly for unleashing capitalism's power." He distinguishes neoliberalism from traditional conservatism, as the latter values respect for traditions and bolstering the institutions which reinforce them, whereas

6678-401: The ideas of those who attended the 1938 colloquium. As a result, there is controversy as to the precise meaning of the term and its usefulness as a descriptor in the social sciences , especially as the number of different kinds of market economies have proliferated in recent years. Unrelated to the economic philosophy described in this article, the term "neoliberalism" is also used to describe

6784-485: The immediate suffering of poor Peruvians who saw unregulated prices increase rapidly. Those living in poverty saw prices increase so much that they could no longer afford food. The New York Times wrote that de Soto advocated for the collapse of Peru's society, with the economist saying that a civil crisis was necessary to support the policies of Fujimori. Fujimori and de Soto would ultimately break their ties after de Soto recommended increased involvement of citizens within

6890-461: The increased economic freedom he believed the neoliberal reforms had brought had put pressure on the dictatorship over time, resulting in a gradual increase in political freedom and, ultimately, the restoration of democracy. The Chilean scholars Javier Martínez and Alvaro Díaz reject this argument, pointing to the long tradition of democracy in Chile. They assert that the defeat of the Pinochet regime and

6996-477: The individual and the voluntary group are progressively undermined by extensions of arbitrary power. Even that most precious possession of Western Man, freedom of thought and expression, is threatened by the spread of creeds which, claiming the privilege of tolerance when in the position of a minority, seek only to establish a position of power in which they can suppress and obliterate all views but their own...The group holds that these developments have been fostered by

7102-522: The interventionist excesses of the Erhard ministry and the ordoliberals, Mises wrote: "I have no illusions about the true character of the politics and politicians of the social market economy". According to Mises, Erhard's teacher Franz Oppenheimer "taught more or less the New Frontier line of" President Kennedy's "Harvard consultants ( Schlesinger , Galbraith , etc.)". In Germany, neoliberalism at first

7208-432: The label "neoliberalism", criticized that development tendency and pressed for a more limited welfare program. Hayek did not like the expression "social market economy", but stated in 1976 that some of his friends in Germany had succeeded in implementing the sort of social order for which he was pleading while using that phrase. In Hayek's view, the social market economy's aiming for both a market economy and social justice

7314-477: The liberal focus on individualism and economic freedom must not be abandoned to collectivism. For decades after the formation of the Mont Pelerin Society , the ideas of the society would remain largely on the fringes of political policy, confined to a number of think-tanks and universities and achieving only measured success with the ordoliberals in Germany , who maintained the need for strong state influence in

7420-442: The market as the greatest information processor, superior to any human being. It is hence considered as the arbiter of truth. Adam Kotsko describes neoliberalism as political theology , as it goes beyond simply being a formula for an economic policy agenda and instead infuses it with a moral ethos that "aspires to be a complete way of life and a holistic worldview, in a way that previous models of capitalism did not." Neoliberalism

7526-404: The mid-1980s, after French philosopher Michel Foucault brought attention to it. At a base level we can say that when we make reference to 'neoliberalism', we are generally referring to the new political, economic and social arrangements within society that emphasize market relations, re-tasking the role of the state, and individual responsibility . Most scholars tend to agree that neoliberalism

7632-427: The miserable state of public services unaltered – most clearly in the case of health services." The candidacy of Pedro Castillo in the 2021 Peruvian general election brought attention to the disparities between urban and rural Peruvians, with much of his support being earned in the exterior portions of the country. Castillo ultimately won the election, with The New York Times reporting his victory as

7738-420: The most important old age income source for a majority of the German population, therefore despite liberal rhetoric the 1950s witnessed what has been called a "reluctant expansion of the welfare state". To end widespread poverty among the elderly the pension reform of 1957 brought a significant extension of the German welfare state which already had been established under Otto von Bismarck . Rüstow, who had coined

7844-469: The nation and the establishment of a neoliberal economy in Peru. During his campaigning for the 1990 Peruvian general election , Alberto Fujimori initially expressed concern against the proposed neoliberal policies of his opponent Mario Vargas Llosa . Peruvian magazine Oiga reported that, following the election, the armed forces were unsure of Fujimori's willingness to fulfill the plan's objectives, though they planned to convince Fujimori to agree to

7950-573: The national health system of Peru" during the period of forced sterilizations. At least 300,000 Peruvians were victims of forced sterilization by the Fujimori government in the 1990s, with the majority being affected by the PNSRPF . The policy of sterilizations resulted in a generational shift that included a smaller younger generation that could not provide economic stimulation to rural areas, making such regions more impoverished. Though economic statistics show improved economic data in Peru in recent decades,

8056-618: The neoliberal policies of the Chicago boys. Some scholars attribute the successes to the re-regulation of the banking industry and a number of targeted social programs designed to alleviate poverty. Others say that while the economy had stabilized and was growing by the late 1980s, inequality widened: nearly 45% of the population had fallen into poverty while the wealthiest 10% had seen their incomes rise by 83%. According to Chilean economist Alejandro Foxley , when Pinochet finished his 17-year term by 1990, around 44% of Chilean families were living below

8162-452: The new meaning of neoliberalism became established as common usage among Spanish-speaking scholars, it diffused into the English-language study of political economy . By 1994 the term entered global circulation and scholarship about it has grown over the last few decades. An early use of the term in English was in 1898 by the French economist Charles Gide to describe the economic beliefs of

8268-464: The operation prior to his inauguration. After taking office, Fujimori abandoned his campaign's economic platform, adopting more aggressive neoliberal policies than those espoused by his election competitor Vargas Llosa. With Fujimori's compliance, plans for a coup as designed in Plan Verde were prepared for two years and finally executed during the 1992 Peruvian coup d'état , which ultimately established

8374-433: The percentage of the Chilean population living in poverty rose from 17% in 1969 to 45% in 1985 at the same time government budgets for education, health and housing dropped by over 20% on average. The era was also marked by economic instability. Overall, scholars have mixed opinions on the effects of the neoliberal reforms. The CIA World Factbook states that Chile's "sound economic policies", maintained consistently since

8480-583: The poverty line. Despite years of suppression by the Pinochet junta, a presidential election was held in 1988, as dictated by the 1980 constitution (though not without Pinochet first holding another plebiscite in an attempt to amend the constitution). In 1990, Patricio Aylwin was democratically elected, bringing an end to the military dictatorship. The reasons cited for Pinochet's acceptance of democratic transition are numerous. Hayek, echoing arguments he had made years earlier in The Road to Serfdom , argued that

8586-624: The preservation and improvement of the free society. The society set out to develop a neoliberal alternative to, on the one hand, the laissez-faire economic consensus that had collapsed with the Great Depression and, on the other, New Deal liberalism and British social democracy , collectivist trends which they believed posed a threat to individual freedom. They believed that classical liberalism had failed because of crippling conceptual flaws which could only be diagnosed and rectified by withdrawing into an intensive discussion group of similarly minded intellectuals; however, they were determined that

8692-413: The proper role of the state . A group of "true (third way) neoliberals" centered around Rüstow and Lippmann advocated for strong state supervision of the economy while a group of old school liberals centered around Mises and Hayek continued to insist that the only legitimate role for the state was to abolish barriers to market entry. Rüstow wrote that Hayek and Mises were relics of the liberalism that caused

8798-404: The recession, Chilean economic growth rose quickly, eventually hovering between 5% and 10% and significantly outpacing the Latin American average (see chart). Additionally, unemployment decreased and the percent of the population below the poverty line declined from 50% in 1984 to 34% by 1989. This led Milton Friedman to call the period the " Miracle of Chile ", and he attributed the successes to

8904-592: The result of other factors; in particular, some scholars argue that after the Crisis of 1982 the "pure" neoliberalism of the late 1970s was replaced by a focus on fostering a social market economy that mixed neoliberal and social welfare policies. As a response to the 2019–20 Chilean protests , a national plebiscite was held in October 2020 to decide whether the Chilean constitution would be rewritten. The "approve" option for

9010-497: The retrenchment of New Deal programs and policies since the 1980s: neoliberalism, laissez-faire or "free market ideology". Other academics such as Susan Braedley, Med Luxton, and Robert W. McChesney, assert that neoliberalism is a political philosophy which seeks to "liberate" the processes of capital accumulation . In contrast, Frances Fox Piven sees neoliberalism as essentially hyper- capitalism . Robert W. McChesney , while defining neoliberalism similarly as "capitalism with

9116-525: The return of democracy came primarily from large-scale mass rebellion that eventually forced party elites to use existing institutional mechanisms to restore democracy. In the 1990s, neoliberal economic policies broadened and deepened, including unilateral tariff reductions and the adoption of free trade agreements with a number of Latin American countries and Canada. At the same time, the decade brought increases in government expenditure on social programs to tackle poverty and poor quality housing. Throughout

9222-545: The role of the private sector in the economy and society . Additionally, the neoliberal project is oriented towards the establishment of institutions and is inherently political in nature, extending beyond mere economic considerations. The term is rarely used by proponents of free-market policies. When the term entered into common academic use during the 1980s in association with Augusto Pinochet 's economic reforms in Chile , it quickly acquired negative connotations and

9328-445: The society believed had produced the Great Depression. Milton Friedman , wrote in his early essay "Neo-liberalism and Its Prospects" that "Neo-liberalism would accept the nineteenth-century liberal emphasis on the fundamental importance of the individual, but it would substitute for the nineteenth century goal of laissez-faire as a means to this end, the goal of the competitive order", which requires limited state intervention to "police

9434-631: The state DFL Party embracing cannabis legalization two decades later. The Youth International Party , formed in 1967 to advance the counterculture of the 1960s , often ran candidates for public office. The Yippie flag is a five-pointed star superimposed with a cannabis leaf. Following the Yippie Party's lead, the Grassroots Party was established in Minnesota, in 1986, as an independent political party that focused on marijuana legalization . In 1996,

9540-480: The system, establish conditions favorable to competition and prevent monopoly , provide a stable monetary framework , and relieve acute misery and distress." By the 1970s, neoliberal thought—including Friedman's—focused almost exclusively on market liberalization and was adamant in its opposition to nearly all forms of state interference in the economy. One of the earliest and most influential turns to neoliberal reform occurred in Chile after an economic crisis in

9646-415: The term political moderates has gained traction as a buzzword . Voters who describe themselves as centrist often mean that they are moderate in their political views, advocating neither extreme left-wing nor extreme right-wing politics. Gallup polling indicates that American voters identified as moderate between 35 and 38% of the time during the 1990s and 2000s. Voters may identify with moderation for

9752-517: The term "neoliberal" as an insult or slur used by leftists against liberals and varieties of liberalism that leftists disagree with. British journalist Will Hutton called neoliberal "an unthinking leftist insult" that "stifle[s] debate." On the other hand, many scholars believe it retains a meaningful definition. Writing in The Guardian , Stephen Metcalf posits that the publication of the 2016 IMF paper "Neoliberalism: Oversold?" helps "put to rest

9858-430: The term] reduces its capacity as an analytic frame. If neoliberalism is to serve as a way of understanding the transformation of society over the last few decades, then the concept is in need of unpacking". Historian Daniel Stedman Jones has similarly said that the term "is too often used as a catch-all shorthand for the horrors associated with globalization and recurring financial crises". Several writers have criticized

9964-543: The theories they had developed in the 1930s and 1940s and contributed to West Germany's reconstruction after the Second World War. Erhard was a member of the Mont Pelerin Society and in constant contact with other neoliberals. He pointed out that he is commonly classified as neoliberal and that he accepted this classification. The ordoliberal Freiburg School was more pragmatic. The German neoliberals accepted

10070-473: The wealth earned between 1990 and 2020 was not distributed throughout the country; living standards showed disparities between the more-developed capital city of Lima and similar coastal regions while rural provinces remained impoverished. Sociologist Maritza Paredes of the Pontifical Catholic University of Peru stated, "People see that all the natural resources are in the countryside but all

10176-556: The working class were reduced. In 1982, Chile again experienced a severe economic recession . The cause of this is contested but most scholars believe the Latin American debt crisis —which swept nearly all of Latin America into financial crisis—was a primary cause. Some scholars argue the neoliberal policies of the Chicago boys heightened the crisis (for instance, percent GDP decrease was higher than in any other Latin American country) or even caused it; for instance, some scholars criticize

10282-648: The world's first test case for 'neoliberal' economics." The turn to neoliberal policies in Chile originated with the Chicago Boys , a select group of Chilean students who, beginning in 1955, were invited to the University of Chicago to pursue postgraduate studies in economics. They studied directly under Milton Friedman and his disciple, Arnold Harberger , and were exposed to Friedrich Hayek . Upon their return to Chile, their neoliberal policy proposals—which centered on widespread deregulation , privatization , reductions to government spending to counter high inflation, and other free-market policies —would remain largely on

10388-573: The world. The term neoliberalism has become increasingly prevalent in recent decades. It has been a significant factor in the proliferation of conservative and right-libertarian organizations, political parties , and think tanks , and predominantly advocated by them. Neoliberalism is often associated with a set of economic liberalization policies, including privatization , deregulation , consumer choice , globalization , free trade , monetarism , austerity , and reductions in government spending . These policies are designed to increase

10494-436: Was a muddle of inconsistent aims. Despite his controversies with the German neoliberals at the Mont Pelerin Society, Ludwig von Mises stated that Erhard and Müller-Armack accomplished a great act of liberalism to restore the German economy and called this "a lesson for the US". According to different research Mises believed that the ordoliberals were hardly better than socialists. As an answer to Hans Hellwig's complaints about

10600-512: Was brought under control. Between 1970 and 1985 the infant mortality rate in Chile fell from 76.1 per 1000 to 22.6 per 1000, the lowest in Latin America. Unemployment from 1980 to 1990 decreased, but remained higher than the South American average (which was stagnant). And despite public perception among Chileans that economic inequality has increased, Chile's Gini coefficient has in fact dropped from 56.2 in 1987 to 46.6 in 2017. While this

10706-399: Was employed principally by critics of market reform and laissez-faire capitalism . Scholars tended to associate it with the theories of economists working with the Mont Pelerin Society , including Friedrich Hayek , Milton Friedman , Ludwig von Mises , and James M. Buchanan , along with politicians and policy-makers such as Margaret Thatcher , Ronald Reagan , and Alan Greenspan . Once

10812-413: Was inherently social and did not need to be made so. He hoped that growing prosperity would enable the population to manage much of their social security by self-reliance and end the necessity for a widespread welfare state. By the name of Volkskapitalismus , there were some efforts to foster private savings. Although average contributions to the public old age insurance were quite small, it remained by far

10918-407: Was marked by the willingness to place humanistic and social values on par with economic efficiency. Alfred Müller-Armack coined the phrase "social market economy" to emphasize the egalitarian and humanistic bent of the idea. According to Boas and Gans-Morse, Walter Eucken stated that "social security and social justice are the greatest concerns of our time". Erhard emphasized that the market

11024-439: Was seen as giving way to a social liberal desire to control markets. This shift in thinking was shaped by the Great Depression and manifested in policies designed to counter the volatility of free markets . One motivation for the development of policies designed to mitigate the volatility of capitalist free markets was a desire to avoid repeating the economic failures of the early 1930s, which have been attributed, in part, to

11130-455: Was synonymous with both ordoliberalism and social market economy. But over time the original term neoliberalism gradually disappeared since social market economy was a much more positive term and fit better into the Wirtschaftswunder (economic miracle) mentality of the 1950s and 1960s. In the 1980s, numerous governments in Latin America adopted neoliberal policies. Chile was among

11236-498: Was the journalist Charles Peters , who, in 1983, published "A Neoliberal's Manifesto". Historian Elizabeth Shermer argued that the term gained popularity largely among left-leaning academics in the 1970s to "describe and decry a late twentieth-century effort by policymakers, think-tank experts, and industrialists to condemn social-democratic reforms and unapologetically implement free-market policies"; economic historian Phillip W. Magness notes its reemergence in academic literature in

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