There is an extensive acceptance that neoliberal rhetorical valorisation of free-market stands in substantial tension with the truly existing neoliberalising processes. We are continually being said that the augmentation of capitalism has ruptured its epochal connection with the state. As Dani Rodrick stress, in its broader interpretation, it is an idea and practice which denotes preference for the market over Government. In a capitalist society, we generally assume that the economic sphere is separated from the political sphere. However, the point of departure for this paper is that the neoliberal thoughts are strongly characterised by the importance of non-market domain, restructuring states and household in the name of markets. This paper will adopt a Marxian political economy approach and place neoliberalism as one of the phases in capitalism. The first part of the paper will shed light on the general literature review on neoliberalism. The second part of the paper will scrutinise how nation-state plays an important role in the capitalist social relation system.
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Neoliberalism is an ambiguous term and hardly defined. Whose meaning vary from paper to paper (Castree 2006: 01), Venugopal (2015: 01) emphasise that Neoliberalism is ubiquitous and it is the dominant and universal economic policy structure of our times, a major political agenda of class ascendancy and exploitation, the appearance of capital revitalisation, a comprehensive dystopian zeitgeist of late-capitalist surplus (ibid). Since the 1980s, the term neoliberalism has manifold, together in positions of absolute diversity and various theoretical and disciplinary frameworks where it has been adopted as well as adapted. According to Venugopal (2015: 01), Neoliberalism has been a victim of its own success. Dani Rodrick rejects the term as bad economics on the terrain of its performance.
The genesis of neoliberalism was in the mid-twentieth century in a period were symbolised by augmenting capitalism for non-market domains such as welfare programs, trade unions, and state intervention. Such domains were inextricably bounded with society. Thus, it is a common feature of the variety of literature of neoliberalism from its beginning to be a profound contradictory project of social transformation. At one end there is a utopian image of free market (Peck 2010: 07) and on the other end, arguments on states as the dominant factor of a stable market society. As Bruff (2014) stress, in recommending ways of overcoming unconstructive contradictions such as market or state, which imply principles that are inherent to diverse social realms.
There is no proof that universal capital is less interest of states than pre-capitalist’s interest. According to Wood, global and national capital depends on states to maintain constructive and favourable conditions for accumulation (Patriquin 2012: 244). Perhaps, globalisation is categorized less by weakening of state than by an increasing conflict amid the universal capacity of capital and continual necessity for additional forms of extra-economic help, rising difference among its economic spread and its political grip. We can gain an insight into this paradox by scrutinising Ellen Wood’s analysis of the historical separation between the economic and political in capitalism, in distinction to former systems.
Meiksins Wood noted that, contrast to other exploitation systems, where appropriation states or classes extract surplus labour through direct coercion, the capitalist exploitation is characterised through separation of labour among the economic moment of appropriation and the extra-economic or political moment of coercion (Patriquin 2012: 245). According to Wood, mainly this division is market dependency of economic producers and appropriators, who produces economic imperatives that are diverse and separated from direct political coercion. This division is a source of contradiction which creates two different scopes with its individual dynamics, spatial range and temporalities (ibid).
On one end, the separation of labour between political and economic moments of capitalism, and among the political coercion and economic imperatives construct capitalism’s distinctive ability for universalisation and expansion. As wood stress, the expansion of capitalism is not limited to direct coercion what can extract from direct producers, neither capital accumulation is narrowed within the structural range of personal domination (Patriquin 2012: 245). Over the means of economic imperatives, capital is distinctively capable to escape the confines of direct coercion and transgress boundaries of political power. This constructs prospect for characteristics of class control and capital’s specific practice of imperialism (ibid).
At the other end, whereas the capitalist economic imperative is distinctively capable of escaping the confines of direct coercion and transgress the boundaries of political and legal authority, similarly foundations of irreducible contradictions make this achievable (Patriquin 2012: 245). As wood argue, economic imperatives of capitalism are constantly requiring extra-economic support of coercion and authority of regulations to construct and withstand the conditions of the accumulation to conserve the system of capitalist property (ibid). However, as Wood asserts, certain transferal of political powers to capital will certainly not obliterate the need to employ others in an isolated political sphere, maintaining the separation among the moment of political coercion and economic appropriation. Perhaps, neither economic imperatives can entirely replace direct political coercion or persist in the absence of political support (ibid).
In fact, more than any other social systems, capitalism requires political structure and legal interpretation of constancy, predictability and uniformity in its social structural arrangement. However, as Wood emphasises, these are a condition of capital’s self-reproduction and very existence that cannot achieve by themselves, and that its individual fundamental anarchic rules of motion continually undermine the power and authority (Patriquin 2012: 246). Indeed, to stable its intrinsic social relation, capitalism is principally dependent on legally interpreted and politically bounded regularities.
Beside, capitalist relations need a wide infrastructure that capitalist profit maximising imperatives are incapable to deliver. Lastly, in a structure of market dependency, approach to methods of maintenance is subjected to the uncertainty of the market. Perhaps, in a system where the economy has been disembodied from societal relations need a politically structured societal provision, at least for the sake of the survival of the people when they are unable to sell their labour-power, and to confirm a reserve army of workers. Thus, capitalism dwells upon the dependency on extra-economic circumstances, legal and political provision, till present no effective means has been discovered except the political practice or nation-state with which capitalism has been historically connected.
Bruff, Ian. 2014. “The Rise of Authoritarian Neoliberalism”. Rethinking Marxism 26, no. 1: 113-29
Brenner, Neil, Jamie Peck and Nik Theodore. 2010. Variegated Neoliberalisation Geographies, Modalities, Pathways”. Global Networks 10, no. 2: 182-222.
Castree, N. (2006). From neoliberalism to neoliberalisation: Consolations, confusions, and necessary illusions. Environment and Planning, 38(1), 1.
Rajesh Venugopal (2015) Neoliberalism as concept, Economy and Society, 44:2, 165-187
The Politics of Capitalism’, Monthly Review, 51, 4 (1999): pp. 14–18, 23–6. New Left Review (newleftreview.org), ‘The Separation of the Economic and the Political in Capitalism’, New Left Review, i, 127 (1981): 80–4, 86–9, 91–5
Patriquin, L. (2012). The Ellen Meiksins Wood reader. 1st ed. Leiden: Brill.
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