Its time to bury the policies of greed

Over the past 40 years, many social democratic parties across the globe flirted with an array of policies often described as ‘neo-liberal’. Although this might sound harmless at face value, the adverse and long term effects of these policies have become unmistakable. As a recent study has confirmed, they have, in effect, increased economic inequality and concentrated wealth into fewer and fewer hands.

First coined in the 1930s, the concept of ‘neo-liberalism’ was hatched as a direct retaliation to the growing dependence of many governments across the West to utilise collectivist, social democratic prescriptions to address pressing social and economic issues of the day.

Over time, with the collapse of the political consensus on the economic role of the State, governments turned to neo-liberal policies instead. During the 1980s, social democratic parties in growing numbers also viewed these policies as a means to ‘modernise’ the Left and provide a ‘fresh approach’. Instead of recognising its insidious seduction and therefore fighting neo-liberalism, the mainstream political Left in many countries, including Australia, embraced it.

Idolising the primacy of the market, in essence, neo-liberalism was clearly a reaction to various forms of socialism through a dangerous mix of ingredients such as privatisation, re-commodification of services, deregulation, fiscal austerity, increased employment insecurity and anti-union laws. On top of this, neo-liberalism and its worship of extreme individualism, embraced competition at all levels – even within society.

It tore at the existing social fabric, promoting greed and in fact dehumanising and blaming certain groups such as women, people from a different ethnicity or race, as well as LGBTIQ communities.
As the Global Financial Crisis (GFC) eventually underscored, the neo-liberal approach has failed.

However, it lingers.

There is a fresh attack from its proponents who claim that any lapse into ‘socialism’ would be disastrous. Yet the irony in this claim is laughable. Governments during the GFC used statist, government interventionist policies to stimulate their economies. Even during the current COVID pandemic, many governments recognised that state assistance is required to prevent a long and arduous economic downturn.

What is clear, however, is that the mainstream Left of Centre’s dalliance with neo-liberalism has been a total catastrophe. Many voters have deserted social democratic parties because they were prepared to adopt a neo-liberal approach if needed. In some countries, this has caused a rupture of the progressive vote and a general failure for left of centre parties to thrive.

With the failure (and reluctance) of neo-liberalism to respond the existential threat of climate change, social democratic parties, including the Australian Labor Party, are now faced with a vital decision. Eschew once and for all the policies of neo-liberalism and its destructive greed or face further electoral splintering and terminal decline.

The social democratic Left, with its unique relationship with organised labour, has a renewed opportunity to bury failed policies of the unbridled market and set a new course that helps reduce inequality, build communities, revitalise democracy and address climate change. The approach need not be solely statist in nature, but instead it should look to building partnerships with local communities, small businesses, social enterprises and organisations that seek social cohesion and inclusiveness. Taking another sip of neo-liberalism’s Kool-Aid would be regrettable.

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