Cornerstones of Neoliberalism - Research Paper Example

Paper on Neoliberalism In the recent times, and more so the last twenty years or so, the ideology of neoliberalism has gained root in a big way in almost all spheres of life the world over. It has particularly become a topic of concern in the academic and the political spheres, dominating important forums and being a subject of debate in many platforms. In trying to understand this subject, various concepts have been brought forward with a wide range of arguments and counter arguments. One thing that scholars have underscored ,and a concept that seems to be relatively agreed upon by all interested parties as far as this concept is concerned is thee fact that the age we are in is an the era of neoliberalism. But what exactly is neoliberalism and how has it been applied economically, politically and even socially in various parts of the world today? What exactly is “Neoliberalism?” One of the simplified definitions that have been given to this phenomena is to the ‘relaxing’ or liberalization of world markets, economies, creating of, free trade and open markets, privatization, deregulation, and strengthening the private sector in modern society in order to ensure that it plays a major role. A certain class of observers has even used neoriberalism as a term that condemns and degrades policies that deregulate the role of the private sector( Alfredo and Deborah, 2003). The concept has also been used to describe what scholars perceive to be a regrettable spread of global capitalism and consumerism, which has led into a situation where there is no strive towards a proactive welfare of states. Perhaps to understand this concept even in much detail, we may explore its origins and early history. Liberalism It is deducible that the tem neoliberalism borrows heavily from liberalism. It I suggest that at one point ion the historical development of nations, politically , economically and socially, neoliberalsim was influential political ideology. However, its status and influence faded into oblivion for some time , only to revive very recently in a new form .Gray(1995) asserts that the term “liberal‟ gained ground in the political circles with the establishment of liberal parliamentary caucuses in Sweden and Spain. This later sporadically spread thorough ought Europe especially during the starting decades of the nineteenth century. It is further argued that in the process of growing these political parties, the term “liberal‟ was coined to describe their understanding of the democratic systems that were rapidly gaining root in Britain and the United States. Through this term, the elite political class was able to describe the conservative nature of their own countries. Further, through such a description they were able forecast the future of the various governments of the world and criticize the attempt by some governments to return their nations to pre-revolutionary forms of government. With several theories that have been developed with time, liberalism has been faceted into classical and modern liberalism. In this, classical liberalism is looked at as the thoughts of the early scholars of the ninetieth and the twentieth centuries. It is taken to taken to describe the state as a minimal entity. Descriptively, this theories argues that practically everything, excluding components such as the armed forces and other law enforcement agencies should be left to the free handling of and by citizens, thus, citizens should be free to choose, establish , associate and take part in any of these entities. In contrast, Modern liberalism advocates for the direct involvement and willingness of the state to actively participate in building the economy. In that case, governments should be able to formulate and implement policies that regulate the marketplace. In addition the state should be able to supply essential goods and services to everyone. In comparison to these two descriptions of liberalism (Friedman, 1962), Modern liberalism may therefore, be seen to have the intentions and purposes of redefining liberalism. If Giovanni Sartori’s (1987) observation where he asserts that liberalism is more of a practical theory meant for building and maintaining democratic policies and securing individual liberty is any thing to go by, then it can be said that t liberalism is less of a partisan ideology that brings about a shared heritage amounts its practitioners , especially those that are committed to goals and ideals such as democracy and freedom. This can be said to be the most advanced definition that has seen preceded the development of the term neoliberalism. Neoliberalism as Set of Concept and Principles Perhaps the first instances of usage of the term neoliberalism can be traced to the nineteenth century as used by Charles Gide, a prominent French economist and central ideologue of the cooperative movement. In this article, Gide forecast later usage of the term and his argument is that neoliberalism is a return to the classical liberal economic theories .However, after this period, different authors emphasize on different aspects of liberalism. For instance they have tended to link liberalism to neoliberalsim especially by describing more recent contributions to liberal theories using the term “neoliberal‟ Cros (1950), describes neoliberalism as a political ideology which was borne out of efforts of reinvigorating classical liberalism especially before and during World War II, by political theorists. In his work. Cros mentions the ideologies of theorists such as Wilhelm Röpke and Friedrich von Hayek and observes that these individuals were much concerned in redefining liberalism From this discussion, it can be observed that although the tern and its general use have gained momentum in the last two decades or so, its development has a history that traces back to the early years of the 20th Century and even some part of the 19th Century( Hayek,1944). This being the case, the term ceases to be a new additional to existing theories that describe political, economic and social development of the nations. However, as this discussion reveals, neoliberalism, like any other theories of its kind has a tendency of gauging polices and the well being of nations through the various mechanisms that have been put in place in these nations to enhance the lives of their citizenry. In other words, the term has been used to give an economic and political description of the situations in nations of the world. That being the case, it can be rightly argued that the theory of neoliberalism touches on all spheres of human development including areas such as polices education, religion and all other areas of human lifestyle. Some observers trace the first full-fledged experiment of ne-liberalism to Chile under the dictatorship of General Augusto Pinochet. Here, Pinochet’s structures seemed to have gained admiration from various quarters for the seemingly far-reaching revolution they brought about. One of the early scholars to have rejoiced over the success of this theory in Chile was Milton Friedman , who termed it as e ‘Miracle of Chile’ and even attempted to urge the Britain’s Prime Margret Thatcher to follow the Chilean model(Harvey,2005) Principally, neoliberalism thus assumes that governments have to follow some key strategies in implementing their role. Firstly, neoliberalism as earlier observed, holds that the state must give in to the belief that there is more efficiency and purported success in unregulated markets and that they tend to maximize individual happiness. Under such circumstances, the measures that governments put in places such as polices that are meant to intervene in these situations distorts the optimal functioning of markets. In that case trade with global partners and investment should be promoted, since it allows the market to function best. Secondly, neoliberalization has to be characterized by aspects such as privatization, deregulation, reduced public spending, floating exchange rates, protection of property rights, liberalization of trade and investment, and limits to state power. When these principles are taken into consideration, then it can be said that neoliberalism has taken root in that particular nation. Some concepts and principles associated with neoliberalism can thus be seen to have achieve some goals as explained below. Expanded time and space of the market. To some extent, neoliberalsim has been seen to bring about a wider global-scale market by advocating for relaxed business environment Unlike the early days. emphasis on assets such as property has been replaced by an emphasis on contract and securing business deals. A typical example is the privatization of the British railway network, which led to securing of 30 000 new contracts. If the government could have held on to the corporation, such a deal could not have been realized. Through neoliberalism, there is an in-depth analysis on the market that reveals the potentials and best areas in which to invest. This is particularly visible on the labor market. For example, an employee has to be continuously assessed regardless of the contract period stipulated. This is mostly because the market is competitive and demands quality products. Neoliberalism as a set of polices implemented by governments The extent which various nations have adopted and utilizes neoliberalism cannot really be quantified. In other words, it may not be easy to distinguish a country as having really adopted neoliberalism and thrown out any other theories. One observation though is that neoliberalism can be used simultaneously with other theories in any given nation.At the same time, it is agreeable that virtually all democratic nations have neoliberalsim characteristics to some extent. In this discussion, we will particularly explore the extent to which China has adopted and utilized neoliberalism, especially in the education sector. As far as the new market economy is concerned, the polices of neoliberalsim have been interpreted and implemented through such mechanisms as decentralized governance in education. For instance the Chinese Communist Party(CPP) has advocated for resolute polices aimed at streamlining administration and devolving of powers to lower levels and units ion order to give room for flexibility in running education. One of the notable policies implemented in by the Chine’s government is the 1985 Decision of the Central Committee of the Chinese Communist Party of China on the reform of the Educational System. This policy highlighted a period that was the beginning educational reforms which eventually aligned the educational system to be in line with the demands of the newly emerging market economy. Through this policy power was devolved to lower levels of government thus considerably reducing the rather rigid governmental controls over schools. It has been established in this paper that one theory advocated for by neoliberalisms is for government to decentralize its duties. Thus this undertaking can be seen as a clear utilization of neoliberalism practices. Further, there has been great diversification of educational services which have since allowed and advocated for participation of non-state sector especially in running and establishing and running educational institutions. While the private sector assumes this mandate and executes it rather well, the state on the other hand has deliberately endeavored to devolve responsibilities and power to local governments. This is seen through putting in place mechanisms that have enabled the participation of local communities and other non-state players more so in the educational sector. For instance the Outline for Reform and Development of Education in China which was introduced in 1993 which emphasized the need to reduce centralization and government intervention. In fact this was highlighted as long-term goals of reform to the education sector. Through this framework, government’s participation was left at the levels of legislation, funding, planning, information service, policy guidance and intervention at the most essential points of administration. This has seen to it that institutions such s 'universities can independently provide education that is aimed at meeting the needs of society under the leadership of the government but through the actual participation of the private sector. Under this kind of agreement, the central government provided space for local states and non-state actors be more actively involved by taking responsibilities in education provision, financing and regulation. This is by all standards a contribution of neoliberalism. It must be noted that these polices are perhaps even more pronounced in China owing to the fact that the nation is predominantly communist. Thus, adaptation of polices advocating for other forms governance become easy to point out. Consequences of adopting neoliberalism to nations and the people. China has many lessons that can be learnt through some of its developments.From the analysis done in this paper it u is deducible that one of the far reaching consequences of neoliberalsim in China is the privateers in China's higher education. The Program for Reform and the Development of China's Education put in place in 1993 was instrumental in encouraging and supporting social institutions as well as citizens to establish schools as far as it was done in accordance with the laws and provided guidelines( He, 1998). It can also be seen that there was a change in the state's attitude towards general development of the nation as the state allowed non-state-run education system. Further, it led to the enhancement of the necessary legal framework which supported elements such as decentralization. This kind of framework gave room to the participation democratic parties, people bodies, social organizations, retired cadres and intellectuals to individually and collectively contribute to the economic organization of the nation( Nonini,2008) The effects of this system were far reaching and even reflected as can be deduced through empirical data. For instance, by the end of 2004, it is estimated that about 1.4 million students had enrolled in various institutions of higher learning as a result of availability vacancies (Su,2010). It has been argued that such numbers could not have been realized without the liberalization of the market to enhance participation of private players. There is also data indicating that by the same year, about 1,300 private institutions, popularly known as minban had developed been developed (Munck, 2005). However, this number is still said to be small in comparison the numbers recorded in public institutions. Another development that can easily be pointed out as a result of neoliberalsim may be found in the argument that the rise of privately ran institutions has led to the production of hybrid public and private sector. Take for instance, the two types of privately run institutions of higher education- second-tier colleges and transnational programmes which are offered by Chinese and foreign partners. These institutions are not only classified as some of the institutions that provide the best quality tertially education but also some of the best competitors in comparison to the public institutions (Zhang,2004). Going even by the fee charged by these institutions, it is asserted that besides providing the much needed tertially education, they also serve as revenue generating projects. In this context one can concisely say that neoliberalism has indeed been effective and a positive contributor to the education sector in China. Discussion This study has demonstrated the far reaching effects of the concepts of neoliberalism. It would be correct to say that the newly emerging transaction intensive markets are a creation of this model .Some of these concepts such as the stock exchange, electricity exchanges, telephone-minute exchanges are continuously being enhanced through the use of technology to assume a more global perspective. The rise of automated trading, and virtual market-like structures, are neoliberal in the sense that they lay emphasis on transaction for transaction's sake. Characteristically, as it is with the whole theory of neoliberalsim, there is no relationship between the growth in the number of transactions, and the underlying production. The creation of reinforced transactions have been used to enhance the number and intensity of transactions being carried out in the marketplace. The ever increasing trade blocks have been enforced by the existence of neoliberal markets. In general, there is increased interactivity that has made neoliberal societies network societies. They tend to underline the fact that formal equality and access are not enough to sustain the market but must be used to create links to other members of the society. This kind of interaction where one market depends on the other and has to be linked to the other in some way had been labeled 'connectionist'. Another aspect that that has been emphasized by the neoliberalism is the attachment of cost to every transaction. It also insists on the use of steps or following some well laid out procedure by assessors. Conclusion This study has indeed outlined the fact that far from being just an economic structure neoliberalism is more of a philosophy. This attribute is seen through the attitudes exhibited by society, the individual and practical implementation in the market. In as much the world is paying attention to this phenomenon, it is important to point out other effects of the concept. The analysis presented in this paper on China has indicated that the growing prominence of the privateness in higher education has brought about a somewhat widened urban and rural divide. A situation has been witnessed where, those who can afford and willing to pay have marginalized the less privileged. In spite of the several measures through which the Chinese government has made attempts to alleviate absolute poverty, on average, poverty and social exclusion have become so acute to a point where they threatened social and political stability. The highlighted negative effects should however not be looked into as failures of the system. The ideology, just like any other theory, is subject to practical implementation where its real effects come to play. Furthermore, the success of its application is relative in the sense that it differs from place to place. One thing that must be underlined though is that the world today has collectively adopted the concept of neoliberalsim. In fact, to some extent, neoliberalism is adapted as globalization, where, one can easily reach for a product or service regardless of the distance. The unpredictable circumstances at this point however is the direction that the marketplace will take after this philosophy have been utilized, and how long the philosophy will be in place.. Works Cited. Alfredo, Saad-Filho and Deborah, Johnston: Neoliberalism – A Critical Reader. London: Pluto Press 2003 Friedman, Milton. Capitalism and Freedom. Chicago: Chicago University Press. 1962. Gray, John (1995): Liberalism. Buckingham: Open University Press. Hayek, Friedrich A. The Road to Serfdom. London: Routledge. 1944 Harvey, David. A Brief History of Neoliberalism. Oxford: Oxford University Press. 2005.Print. He, Qinglian.. Pitfalls of Modernization. Beijing: Dangdai zhongguo chubanshe (Modern China Press. 1998 Klein, Naomi.. The Shock Doctrine: The Rise of Disaster Capitalism. London: Allen Lane. 2007 Munck, Ronaldo: “Neoliberalism and Politics, and the Politics of Neoliberalism”; 2005 Nonini, Donald M. 2008. “Is China Becoming Neoliberal?” Critique of Anthropology 28(2): 145-176 Su, Xiaohe. “Cong Li Rongrui xieren kan guo jin min tui (Li Rongrui's Retirement: the State Advances and the Private. Sector Retreats).” Southern Metropolis Weekly, 2010. Zhang, Hanma.. Growing inequality and poverty in China, China Economic Review. 2004 Read More