Nationalism and Neoliberal Governance

This post is part of our symposium on Mutant Neoliberalism. You can find the full symposium here

William Davies –

mutant neolib imageIn my 2014 book The Limits of Neoliberalism, I offered a largely Weberian account of how the principle of competition provides the metaphysical ideas on which the authority of the neoliberal state depends. Crucially, I suggested, competition doesn’t just offer a single idea, but two conflicting ideas: a liberal ideal of fairness of the competitive ‘game’ (as witnessed in appeals to ‘meritocracy’ and a ‘level playing field’) and a Schmittian ideal of victory over one’s foes (as witnessed in the fields of business strategy or life coaching). There is a tension at the heart of the neoliberal state, between the ambition to install the market as a legally-mandated universal norm, and the ambition to nurture the most innovative, competitive and powerful firms and territories.

To explore the latter, I studied a discourse rarely associated with neoliberal thought, that of national competitiveness, that was developed via a network of Harvard Business School, The World Economic Forum and a handful of other think tanks and European business schools, starting in the late 1970s. This was seized enthusiastically by the European Commission during the 1990s, which saw it as a way to revitalise sluggish European economies, and a justification to cut regulation (especially employment protections) and tax.

But what fascinated me especially about this discourse (which I was studying around 2007-08, back when Lehman Brothers was a bank and Donald Trump the guy from The Apprentice) were the hints of mercantilism, nationalism and existential threat that lurked on its margins. European competitiveness was threatened by its ageing population; US competitiveness was threatened by the end of the Cold War, which had done so much to cultivate innovation. Japan and later China were a danger. If one reads Quinn Slobodian’s Globalists, surely this is not how neoliberalism is supposed to work. I encountered economists working for the European Commission, who confessed to me (off the record) that they were afraid that there was a protectionist and mercantilist substrate to the whole discourse. The reason for these recollections here is that I can now see, with the aid of William Callison and Zachary Manfredi’s superb volume, that there were hints of ‘mutant neoliberalism’ emerging on the edges of the competitiveness agenda. To use Callison and Manfredi’s suggestive metaphor, the economists’ fear was that the competitiveness ‘gene’ might ‘mutate’ into something illiberal.

The uneasy balance sought by competitiveness gurus was that political leaders should seize the full force of their executive sovereign powers, and put them to use only in the pursuit of a more innovative, flexible, enterprising nation. At the heart of the vision of national competitiveness is an analogy (hated by liberal economists) between states and firms. League tables are crucial in keeping this analogy alive. As Christopher Newfield’s valuable contribution to Mutant Neoliberalism attests, this vision of leadership is not restricted to national politics or firms, but can be reproduced at the level of the university (or for that matter the municipality, neighbourhood or even self).

As Newfield notes, an implication of the cult of competitiveness (or ‘disruptive innovation’ that his chapter explores) is that the non-competitive or non-disruptive will be abandoned. As I put it in my book:

Business strategy encourages managers to evaluate how well suited their firm’s existing resources and activities are to their emerging competitive environment. Certain resources can be abandoned (out-sourcing, down-sizing), and others acquired (M&As)… The same is not true with respect to nations. The geography of the competitive state concentrates political capital behind the most competitive cities, clusters and regions, in contrast to a Keynesian spatial strategy which spreads wealth via industrial policy. What then becomes of the uncompetitive spaces or populations?

As Newfield remarks, this kind of ideology “taught politicians in Youngstown and elsewhere that industries like steel and their unionized employees had been judged by an impartial market to be outmoded”.

Across the liberal capitalist world, this situation subsequently provided the perfect opportunity for populist leaders to arrive and speak the language of collectivism, albeit with ethno-nationalist undertones that don’t treat everyone as part of ‘the people’. Where Donald Trump is concerned, the language may be primarily geared to entrenching cultural divisions (mixed with statistical lies), but Melinda Cooper’s darkly fascinating contribution to the volume demonstrates how nationalist opposition to the free market can deliver wholesale economic change. Post-Brexit Britain is currently encountering a similar dynamic, in which a right-wing leader is seeking to position himself as the friend of depressed post-industrial regions. Whether this results in economic change remains to be seen.

Nationalism may appear to emerge beyond the perimeter of neoliberalism. As both Michel Foucault and Wendy Brown have shown, opposition to fascism was central to the genealogy of neoliberalism, at least in its ordoliberal form. However, the discourse of national competitiveness obviously cannot leave the nation alone altogether. As I argued, “political and nationalist energies are harnessed and diverted, rather than thwarted”. The inevitable risk is that these energies become unharnessed in various ways. This is broadly what Michel Feher’s and Slobodian and Dieter Plehwe’s chapters reveal, albeit in very different ways.

Feher provides a grim account of how sections of European populations have become ‘discredited’ and therefore disposable. Once human beings become viewed as a form of capital, and not as citizens or subjects, then a somewhat eugenicist question arises of the hierarchy of human capital value. This brings the discrimination of the market into the same orbit as discrimination based on race and ‘natural’ aptitude. Neoliberalism potentially then mutates into what Achille Mbembe has termed ‘necro-politics’, which sorts those who deserve to live, from those who deserve to die.

One can imagine a spectrum of mutations of this sort, ranging from the most economistic forms of discrimination (think of libertarian market nationalists, that Slobodian refers to as the ‘bastards’ of neoliberalism, who trust entirely in the price mechanism) through to the most racist, such as the Nazi political economy described by Cooper. It’s worth noting that, somewhere between the two, sits the kind of ‘common sense’ market populism that Soren Brandes’s chapter detects in Milton Friedman’s Free to Choose, and which Stuart Hall saw in Thatcherism right at the outset.

The Slobodian and Plehwe chapter describes a movement, forged during the 1990s heyday of neoliberal policy-making, that pulls towards the first end of the above spectrum: libertarian Euroscepticism. As a British reader, this piece is nothing if not timely, while also greatly illuminating – the discovery that a pioneering British Eurosceptic had published a book in the 1990s entitled This Will Hurt: The Restoration of Virtue and Civic Order immediately was startling, but confirmed my own suspicions about the latent anti-utilitarian ideology of Brexit. There are also linkages that could be made between this project, which is forged out of hatred for the welfare state and labour protections, and Brown’s contribution to the volume, which describes the nihilistic attacks on democratic egalitarianism that have emerged out of neoliberalism since 2016. The market takes on a punitive quality, that serves to restore ‘natural’ gender hierarchies, as Cooper’s Family Values has shown.

Unlike the fascists discussed by Cooper, the nationalist libertarians described by Slobodian and Plehwe are undoubtedly still ‘neoliberal’, at least inasmuch as they celebrate trade, free markets and enterprise. It’s just that, in challenging European integration, they celebrate a more ruthless vision of inter-national competition, in which ‘competitiveness’ would mean something more like the “race for the bottom” that many have long suspected it would entail, despite the protests to the contrary of the European Commission and the World Economic Forum.

When writing The Limits of Neoliberalism, I wondered if my remarks about the Schmittian-nationalist strand of neoliberal authority were an exaggeration, not least because the competitiveness experts I’d interviewed back in 2007 were at such pains to reassure me that they viewed capitalism as a positive-sum game, from which everybody benefits. I’m now more confident in the diagnosis. Viewed in terms of mutation, neoliberalism can be understood as containing various genes and genres that were innocent enough at their birth, but which adapt and grow in response to history, often in malign ways. It’s a valuable framing and a terrific collection of pieces, that has helped me look back on my own work and that of other neoliberalism scholars in a fresh light.

William Davies is Professor of Political Economy at Goldsmiths, University of London