Neoliberalism

Vishanthie Sewpaul, School of Applied Human Sciences, Howard College Campus, University of KwaZulu Natal, Durban,
South Africa
2015 Elsevier Ltd. All rights reserved.

Abstract
This article teases out the concept of neoliberalism as ideology, as a form of governmentality, and as a policy paradigm. It
provides a brief history of neoliberalism and then discusses the consequences of neoliberalism in respect of unfair trade, the
destruction of domestic production and markets, poverty, and inequality. It concludes with the argument that despite the
ideological hegemony of neoliberalism, the current crisis and trends of global social justice movements, which social workers
can be engaged in, hold potential to create alternative socioeconomic and political systems in support of a more just world.

Introduction
Neoliberalism has its ideological roots in classical liberalism
articulated by early theorists such as John Locke, Adam Smith,
and David Ricardo and in the twentieth-century theories of
Friedrich von Hayek and Milton Friedman (Harvey, 2005;
Pierson, 1991; Steger and Roy, 2010). The neoliberal revolution was consolidated during the regimes of Margaret Thatcher
in the United Kingdom and Ronald Reagan in the United States
from the early 1980s onward. A related signicant event during
this period was the opening up of the economy of China, the
worlds emerging superpower, by Deng Xiaoping in 1978.
According to Harvey (2005), events in the United Kingdom, the
United States, and China during this period spread and
reverberated to remake the world around us in a totally
different image (p. 1). The breakdown of Soviet communism
also played a decisive role in entrenching neoliberalism as the
dominant ideology. The past few decades have witnessed the
increasing dominance of neoliberalism as discourse and practice on a global level, which has remolded health, education
and welfare, and global ows of nance, trade, and labor
(Abramovitz and Zelnick, 2010; Schram and Silverman, 2012;
Sewpaul, 2008; Rowden, 2009).
Classical liberalism is characterized by a global laissez-faire
that holds the market to be sacrosanct, self-regulating, and
entirely rational. This was the appeal of Adam Smiths idea
that markets and the pursuit of self-interest would lead, as if
by an invisible hand, to economic efciency (Stiglitz, 2006:
p. xiv). Referring to contemporary neoliberalism, the collapse
of markets; the implosion of the American nancial system,
beginning with the subprime mortgage crisis that began in
August 2007; and the bail-out of banks, Gray (2009)
reiterated his belief of 1998 that: Todays regime of laissezfaire will be briefer even than the belle poque of 1870 to
1914, which ended in the trenches of the Great War (p. xii).
Obamas (2009) inaugural address in which he warned that,
without a watchful eye, the market can spin out of control
also made some people believe that the end of neoliberalism
was imminent. Yet, the world failed to shake the
Washington Consensus (Bond, 2010: p. 59) a consensus
between the International Monetary Fund (IMF), the World
Bank (WB), and the United States Treasury that fostered
scal austerity, privatization, and market liberalization

462

(Stiglitz, 2006) that are dening features of neoliberalism.

However, there is now hope as the majority of the worlds
dispossessed (symbolically represented as the 99%) is
reacting to global capitalism as seen in the recent Arab
spring, the Occupy movement, and protests in many parts
of the world. This article teases out the concept of
neoliberalism, provides a brief history of it, and then
discusses the consequences of neoliberalism. It concludes
with the argument that despite the ideological hegemony of
neoliberalism, the current crisis and trends of global social
justice movements hold potential to create alternative
socioeconomic and political systems in support of a more
just world, which constitutes a central goal of social work
education, research, and practice.

Conceptualization of Neoliberalism
Neoliberalism refers to a combination of socioeconomic and
political discourse and policy choices based on the values of
an unregulated market; the rarefaction of individual freedom
and choice; as well as the faith that market fundamentalism,
and not state intervention, would promote economic growth,
efciency, progress, and distributional justice, primarily
through trickle-down effects. Harvey (2005) denes
neoliberalism as a theory of political economic practices
(p. 2), rather than an unadulterated political ideology.
Although neoliberalism has its roots in classic liberalism, it
has come to span diverse political leanings and is associated
with center-left politics, moderate right-wing conservatism,
and autocratic dictatorships, embraced by and/or imposed
on almost all countries across the globe. The author draws
on the works of Larner (2000) and Steger and Roy (2010)
to conceptualize neoliberalism as an ideology, as a form
of governmentality, and as a policy paradigm. These
dimensions are mutually constitutive and overlapping.

Neoliberalism as Ideology
Dumnil and Lvy (2011) maintain that the neoliberal revolution was engineered by class and imperialist objectives,
serving the interests of a privileged minority and a few powerful
countries, with the United States occupying a unique

International Encyclopedia of the Social & Behavioral Sciences, 2nd edition, Volume 16

http://dx.doi.org/10.1016/B978-0-08-097086-8.28062-8

Neoliberalism

hegemonic power. They argue that ideology was not the engine
of the neoliberal revolution but that the hegemony of the
upper classes was deliberately restored [.] A neoliberal
ideology emerged, the expression of the class objectives of
neoliberalism (p. 18). Whether a precursor to and/or an
outcome of the neoliberal revolution, ideology has come to
play a huge role in its reproduction. While the crisis that began
in 2007, with the crash in October 2008, held the potential to
create cracks in the consciousness of people about the moral
and pragmatic limits of a system regarded as inviolate
(Sewpaul, 2008), the opportunities seem to be lost. Although
Stiglitz (2006) claimed that there is little intellectual defense of
market fundamentalism left, a claim supported by a reading of
the vast body of literature that almost unanimously speaks
of the negative consequences of neoliberalism, there is yet
a marked failure to disrupt the Washington Consensus. Given
the power of ideology, the disjuncture between popularly
held neoliberal values and empirical data, and the lack of
political debate on neoliberalism in mainstream politics, this
is understandable.
Fortunato Jr. (2005) described the manufacture of
consent (p. 4) by the mass media that serves the interests of
the corporate world and political elites and that ensures that
capitalism succeeds through ideological control of consciousness designed to make us believe that neoliberalism is in our
interests and is inevitable. Neoliberalism was engineered and
gained ground primarily on account of the lure of the language
of liberal theory with its emphases on individualism, ownership, choice, exibility, and competition that mask the grim
realities of the restoration or reconstitution of naked class
power (Harvey, 2005: p. 119). It is not only the manufacture
of consent that is created by the media but also the manufacture of desire (Leonard, 1997: p. 37) as the market seduces
people into constructing themselves as good consumers where
their moral worth is determined by their ability to make the
right purchasing choices (Bauman, 1992). Bauman (Bauman
and Tester, 2001: p. 87) speaks of the disguise of the individuals freedom of choice, which is so taken for granted that it
seldom has a chance of being examined and questioned [.]
an old sinister temptation [.] left to be exploited by
commercial markets. These views are suggestive of Gramscis
(1977) thesis of ideological hegemony exercised by the state
and civil society to control the consciousness of people, not
through repression or coercion but by gaining popular consent
in the reproduction of class relations.
While most theorists are quick to comment on the dangers of
neoliberalism, few are willing to critique the liberal democracy
that underpins it. There is a general taken-for-granted
assumption of a convergence between the market and
democracy, with American liberalism and capitalist hegemony
touted as the source of morality and democratic practice,
which is furthest from the truth (Amin, 2001; Fortunato Jr.,
2005; Harvey, 2005). Samir Amin (2001), a postcolonial
writer, cogently raises a number of critical questions in relation
to liberal democracy and neoliberalism, concluding that
Convergence theory the notion that the market and
democracy converge is today pure dogma with much of the
talk about democracy reecting the imposition of policy
makers who have usurped power in the United States (p. 9).
Gray (2009) declares that democracy and the free market are

463

competitors rather than partners (p. 213), a view supported

by Stiglitz (2006) who proclaims that neoliberal globalization
is not consistent with democratic principles.
Citing several groups of power elites that serve as the main
advocates of neoliberalism Steger and Roy (2010: pp. 1112)
argue that: These individuals saturate the public discourse
with idealized images of a consumerist, free-market world
[...] neoliberal decision-makers function as expert designers of
an attractive ideological container for their market-friendly
political agenda.
Neoliberalism does not get reproduced in a vacuum. We are
all complicit. We all consume [.] we all participate in hierarchies of race, class gender and privilege. No one is a pure
victim in this economic system, though almost everyone is
ultimately a loser (Haiven, 2011: p. 1). Harvey (2005)
describes how neoliberalism penetrates daily consciousness
so much so that it is normalized and naturalized, and it is
considered necessary for social order despite the gross
inequalities and poverty that it engenders.

Neoliberal Governmentality
The treatise on neoliberalism as a mode of governance borrows
from Foucaults concept of governmentalities that provides
a means of understanding the relationships between knowledge, power, and technologies of the self (Foucault, 1984;
Leonard, 1997; Lemke, 2002). From this perspective, neoliberalism refers to a political rationality that tries to render the
social domain economic and to link a reduction in (welfare)
state services and security systems to the increasing call for
personal responsibility and self-care (Lemke, 2002: p. 203).
While neoliberalism guarantees personal and individual
freedom, each person is held responsible for his or her own
actions and well-being. Thus, poverty and hardships are seen as
personal failings rather than being attributed to any structural
barriers to unemployment and the consequences of exclusions
based on race, class, caste, gender, and/or disability. Steger
and Roy (2010) assert that:
A neoliberal governmentality is rooted in entrepreneurial values
such as competitiveness, self-interest, and decentralization [...]
Rather than operating along more traditional lines of pursuing the
public good (rather than prots) by enhancing civil society and
social justice, neoliberals call for the employment of governmental
technologies that are taken from the world of business and
commerce. (p. 12)

Thus, along with neoliberalism, there is entrenching of

new managerialism into all spheres of life, including social
work and welfare. New managerialism emphasizes getting
the job done, with checks and balances in the shortest space
of time as well as with the imposition of economy, efciency,
and effectiveness manifesting in such tangibles as performance measurement, inputs and outputs, outcomes, and
targets (Dominelli, 1996). One example of this, in the South
African context, is the Financing Policy for Welfare, which
speaks of business plans, contracts, affordability, efciency,
outputs, performance audits, outsourcing, venture nancing,
and service purchasing, thus effectively reconstructing users
of welfare services as customers (Sewpaul and Hlscher,

464

Neoliberalism

2004). This trend, replicated in many parts of the world,

found its origins in Britain and the United States. The 1989
Community Care White Paper in Britain (cited in Sewpaul
and Hlscher, 2004) promoted choice, exibility, and
innovation, which was to be achieved through a prospering
private welfare sector and outsourcing of government
services. The introduction of competition between providers
is aimed at increasing value for money, efciency, accountability, and quality of the services provided. Banks (2011),
writing within the British context, observes an intensication
of procedures, measurement and centrally dened targets
(p. 10) and the adoption of depersonalized ethics that focus
on predetermined standards, contracts, and procedural
manuals. New managerialism relegates the importance of
other ethical values such as autonomy, critical reection,
care, equality, solidarity, interdependence, reciprocity,
respect, and trust in favor of narrowly dened economic
priorities (Bottery, 2000).

Neoliberalism as Policy
As a policy package, neoliberalism is associated with spread of
global capitalism and consumerism that has engineered the
attacks on, and dismantling of the welfare state (Chomsky,
1999; Harvey, 2005; Steger and Roy, 2010), expressed in
what Steger and Roy (2010: p. 14) call the D-L-P formula,
which is deregulation of the economy, liberalization of trade,
and privatization of state assets, which provided the
ideological basis for the restructuring, privatization, and
retrenchment of social policy and welfare programs, and for
managerial approaches to social work practice (Clarke, 2007).
Neoliberalism is a discourse and practice, which rarees
individual interests where transnational corporations (TNCs)
and a few, rich powerful elites dominate the market primarily
interested in prot making. Following this individualistic
logic, the state uses neoliberal socioeconomic policies to
allow it to abdicate its responsibilities in relation to the
welfare of its people. Evocative of Foucaults (1984)
governmentality and technologies of the self, the most
dominant neoliberal discourses in social work and welfare
have been on the promotion of self-reliance, the importance
of individuals and families taking responsibility for their own
well-being, and shifting responsibility from the state to local
communities. This neoliberal policy doctrine is reected in
the voice of a manager in the South African context: The
State is an entrepreneur of its own. It must make a prot
where it can [.]. The state must be minimalist, it must really
do the least and the last. Civil society, empowered civil
society is to do the most (Sewpaul and Hlscher, 2004:
pp. 8485), a doctrine that had become quite universal in
the 1990s, reecting the hegemony of neoliberalism. Apart
from the use of ideological manipulation that engineered
this, there was the use of military force and sanctions, or
threats of sanctions by the United States against governments
in the developing world that deviated from the US ideal
of liberal capitalist democracy (Harvey, 2005; Sewpaul,
2006; Steger and Roy, 2010). In some countries like the
United Kingdom, there continues to be the strategic use of
budgets and legislation, thus avoiding political discourses on
the nature of the welfare state and of social work.

Neoliberalism: A Brief History

There are three distinct periods of lasting and deep structural
crises in the history of modern capitalism: the crisis of the
1890s, the Great Depression, and the crisis of the 1970s, with
the contemporary crisis of neoliberalism ushering in a new
phase (Dumnil and Lvy, 2011).
Mid-Victorian England saw the demolition of social markets
(which combined a regulated market with issues of social
justice, with, for example, universal health care and extensive
social security) and the introduction of deregulated, free
markets that functioned independently of social needs, based
on the theories of classical liberals like Adam Smith and David
Ricardo (Gray, 2009; Steger and Roy, 2010) who were
convinced that economic difculties were the consequence of
government failures, particularly from state interference.
People were seen to be creatures of economic rationality and, in
accordance with modernist thinking, as opposed to premodern
conceptions of an unquestionable divine order (Howe, 1994),
evolved the idea of the human being as subject, an autonomous self who is the source of his or own action (Sewpaul and
Hlscher, 2004: p. 18), thus imposing no duty on the part of
the public to provide, or any right on the part of the destitute to
claim any relief.
Gray (2009) argues that the removal of agricultural
protectionism, free trade, and the Poor Laws of 1834 formed
the cornerstones of the unregulated market of mid-Victorian
times that has inuenced all subsequent neoliberal policies.
The Poor Law Act of 1834 was one of the most demeaning
and stigmatizing pieces of legislation based on laissez-faire
ideology, reected in the activities of the nineteenth-century
charities, particularly that of the Charity Organisation Society
whose activities rested on a belief in moral character as the
decisive feature in peoples circumstances no structural
issues of power, unemployment or marginalization entered
the moral calculus (Clarke, 1993: p. 9), hence individuals
were solely responsible for their own welfare (Gray, 2009:
p. 9). The laissez-faire ideology reduced the role of the state to
that of night watchman (Steger and Roy, 2010: p. 5) where
the state takes responsibility only for the most basic aspects
of public order, and it entrenched casework as the basis of
social work while marginalizing the more structural
approaches to the profession, as reected in the work of the
Settlement House Movement.
This laissez-faire governance was legislated out of existence
from the 1870s onward and, by the end of World War I,
markets had become, in the main, reregulated in the interests of
public health and welfare. However, individualism and free
trade characterized Britain until the Great Depression of the
1930s that paved the way for Keynesian economics underscored by egalitarian or embedded liberalism, which held sway
from the mid-1940s until the 1970s (Gray, 2009; Stiglitz, 2006;
Steger and Roy, 2010). This was not the product of a natural
evolution. Leonard (1997) posits that the political masses
played a central role in establishing the Keynesian welfare
state in the West, including the United States, although
working class consciousness was weaker and more transitory
there than in the social democracies of Europe. Keynesian
egalitarianism involved state intervention, regulation of the
market, the involvement of organized labor to promote full

Neoliberalism

employment and growth, and some state ownership of crucial

national enterprises like railroads, public utilities, and energy
companies (Keynes, 1933). Keynes in 1933 (unpaged) argued
that, Ideas, knowledge, science, hospitality, travel these
are the things which should of their nature be international.
But let goods be homespun whenever it is reasonably
and conveniently possible, and, above all, let nance be
primarily national. The salience of his reections for our
contemporary world is expressed in the following:

Experience accumulates to prove that most modem processes of

mass production can be performed in most countries and climates
with almost equal efciency [...]. National self-sufciency [.]
though it costs something, may be becoming a luxury, which we
can afford, if we happen to want it.

Karl Polyani also made signicant contributions to

economic thinking during this period. In 1944, combining
issues of economic and environmental justice, he prophetically
wrote: To allow the market mechanism to be the sole director
of the fate of human beings and their natural environment [.]
would result in the demolition of society (Polyani, 1957: p.
73). Polyani, like Keynes, believed that sustainable economic
relationships needed to be embedded in a framework of
regulations, institutions, and social norms.
In the three decades following World War II, Keynesianism,
which inspired the American New Deal, the British welfare
state, and the Scandinavian Social Democratic welfare model,
produced impressive economic growth, low ination, high
wages, and exceptional levels of human well-being and social
security. The benets of Keynesianism, however, eluded most
of Africa (Harvey, 2005), which continued to be the biggest
loser throughout history and as neoliberalism intensied into
the 1990s. Keynesianism came to a halt with the economic
crises of the 1970s, with the oil shocks that raised the price of
petrol, and induced high ination and rising unemployment
(Harvey, 2005; Steger and Roy, 2010; Stiglitz, 2006). The
structural crisis of the 1970s allowed for the reassertion of
the dominance of nance (Dumnil and Lvy, 2001)
revitalizing the earlier creed of classical liberalism under
conditions of globalization.
The welfare state in Britain was one of the casualties of the
imposition of IMF conditions in 1976 when Britain borrowed
US$3.9 billion. The loan came with a heavy price as it introduced policy changes away from full employment and social
welfare toward ination and public expenditure controls
(The Cabinet Papers 191582). The early 1980s saw the
consolidation of rst wave neoliberalism, characterized by
conservative Thatcherism and Reaganomics, based on reducing
taxes, liberalizing exchange rate controls, deregulation,
privatization, and diminishing the power of labor unions,
interlaced with the geopolitical imperative to stop the spread
of communism and socialist developmentalism in the Third
World (Steger and Roy, 2010: p. 47), directed primarily at
the maintenance of US hegemony through its imperialist roles
in the WB, the IMF, and the economies of Latin America,
Africa, and Asia (Stiglitz, 2006; Gray, 2009). The introduction
of structural adjustment policies and programs, the changes in
the US monetary policies toward price stability before full

465

employment, and their associated debt crises produced untold

burdens for Third World countries (Stiglitz, 2006; Dumnil
and Lvy, 2011): A strategy for development [.]
transformed into an actual catastrophe by a decision
emanating [.] within leading capitalist countries, with a total
indifference for the hardship imposed on the Third World
(Dumnil and Lvy, 2001: p. 595). Second-wave
neoliberalism has been identied with the policies of Tony
Blair and Bill Clinton, that began in the 1990s and sought to
strengthen social solidarity without dropping the neoliberal
ideal of market-oriented entrepreneurship (Steger and Roy,
2010: p. 50), with a corporate-led globalization that
entrenched further inequalities within countries and between
the North and the South (Sachs, 2005; Saul, 2006).
Despite its success, Keynesian economics was vilied by
classical liberals like Von Hayek and Milton Friedman, whose
doctrines dominated the 1944 Bretton Woods conference,
which saw the introduction of a system of free trade with xed
exchange rates tied to the US dollar and the establishment of
the International Bank for Reconstruction and Development,
later renamed the WB, and the IMF (Harvey, 2005; Stiglitz,
2006), initially designed to provide loans for Europes postwar reconstruction but later expanded to fund various industrial projects in developing countries. The General Agreement
on Tariffs and Trade (GATT) was established in 1947 in order
to enforce multilateral trade agreements. In 1995, the World
Trade Organization (WTO) was founded as a successor to
GATT.
In the mid-twentieth century, given that national economies
were still relatively closed, governments were able to regulate
capital movements, which allowed for a period of relative
stability and economic growth that enabled the implementation
of Keynesian policies that formed the structural basis of the
welfare state (Sewpaul and Hlscher, 2004). But following the
recession, in 1971, the United States denounced the xed
exchange rate linked to a xed gold price, a move followed in
1973 by the introduction of exible exchange rates and the
abolition of capital controls by the United States in 1974, followed by Britain in 1979, and by the early 1990s, most of the
other 32 Organisation for Economic Cooperation and Development (OECD) countries (Pierson, 1991). The increase in
international trade provoked greater nancial speculation and
uctuation of exchange rates, with a steady growth of TNCs.
These developments altered the economic context within which
the welfare state operated in the context of OECD countries,
yet they failed to stem the recession that they were aimed
at addressing. Pierson (1991) avers that: Governments
throughout the developed West were simultaneously failing to
achieve the four major economic policy objectives growth,
low ination, full employment and balance of trade on
which the post-war order had been based (p. 145). With
monetary policy increasingly being set by the WB, the IMF,
and the United States; the ability of capital to move freely;
and the growing presence of TNCs that provided capital with
an exit option from one national economy to another, the
bargaining power of governments was weakened. Yet, the
neoliberal agenda was and continues to be a product of
strong governments and cannot function without them.
The attack on the World Trade Center on 11 September 2001
led to another phase where the profoundly anti-democratic

466

Neoliberalism

nature of neoliberalism [is] backed by the authoritarianism of

the neoconservatives (Harvey, 2005: p. 205) and where
neoliberal discourses are increasingly tied up with the penalization of poverty (Wacquant, 2001) and with antiterrorism and
Islamophobic discourses. On 11 September 2001, radical
Islamic forces attacked what they considered to be the symbols
of economic oppression the World Trade Centre and the
Pentagon in the worlds most neoliberal society. Steger and
Roy (2010) rightly concluded that Bin Laden articulated
a criticism of neoliberal market globalism that was shared by
opponents of neoliberalism across the Left/Right ideological
divide though the principles and horric methods of alQaeda have been unambiguously denounced by the leaders of
the global justice movement (p. 123). Despite growing
inequality and crises engendered by neoliberalism, and the
global manifestations of resistance against it, neoliberalism
endures largely on account of the taken-for-granted
assumptions that are reproduced among people on a daily
basis.

Consequences of Neoliberalism
The current crises, which is seeing marked decreases in the living
standards of people, has reverberating effects in all parts of the
globe, as reected in the crises of Wall Street, the deepening of
the Eurozone crisis, the economic slowdown of some of the
Asian countries including India and China, and the entrenching
of uneven development and greater inequality within and
across countries. Dumnil and Lvy (2011) contend that, as
a class project, neoliberalism has been exceptionally successful
as it has worked in the interests of privileged minority capitalist
classes with the divides between the rich and the poor having
deepened. Neoliberalism has contributed to distorted development between the North and the South, to greater levels of
inequality within nation-states, to the further marginalization of
women and to a greater feminization of poverty, especially
among Black women (Dominelli, 2002; Gibson, 2009; Lara,
2011; Sewpaul, 2005; Stiglitz, 2006; Gray, 2009; Steger and
Roy, 2010). The World Commission on the Social
Dimensions of Globalization (2004) concluded that the levels
of global imbalances were morally unacceptable and
politically unsustainable (p. x), while some authors like
Dominelli (2012) and Nixon (2010) warn that the great
threat is also against environmental sustainability. In a survey
of 73 countries, the Commission found that apart from
South Asia, the United States, and the European Union,
unemployment increased between 1990 and 2002, with
global unemployment reaching a high of 185.9 million, and
that 59% of the worlds people were living in countries with
growing inequality.
While countries in Africa, Asia, and Latin America have long
been the biggest losers within global capitalism with austerity
measures imposed as conditionalities of structural adjustment
programs (Dominelli, 2008; Rowden, 2009; Bond, 2005;
Stiglitz, 2006; Gray, 2009), patterns of capital accumulation
and consumption are now becoming more complex, with many
of the rich core capitalist countries now being subject to stringent austerity measures. There are new congurations of global
power with, for example, a growing Chinese imperialism that

challenges the hegemony of the United States. Also, while many

companies have been relocating production to low-wage
countries for many years, India has become very successful in
attracting high-skilled jobs in computer programming and
customer services. The NorthSouth divide is giving way to
a new international division of labor where the familiar
pyramid of the core-periphery hierarchy is no longer
a geographic but a social division of the world economy
(Hoogvelt, 1997: p. xii). The current manifestation of these is
the rising levels of unemployment and inequality and the
severe austerity measures sweeping across the globe, with the
United States and several European countries like Italy,
Greece, Portugal, Britain, and France being extremely hard hit.
In the United States, between 2000 and 2008 household
incomes declined 1%, while corporate prots rose 70%; the
gap between the rich and the poor is higher than at any time
since 1930; and the rates of poverty and those living without
health insurance has increased by 20% (Nixon, 2010).
Economic growth in itself does not translate into a better life
for the majority of people, and the trickle-down notion of
capitalism has proved to be a myth. The International Labor
Organization (ILO, 2009) predicted that the crisis would wipe
out at least 20 million jobs by the end of 2009, bringing
global unemployment to an unprecedented number of over
200 million.
Accompanying neoliberal policy choices are the weakening
of trade unions and labor power; tax cuts for big business and
the rich; the erosion of meaningful and egalitarian democracy;
cutbacks in state expenditure in sectors such as health, education, and welfare; the relocation of labor to areas of least
production costs; and the creation of sweatshops and economic
processing zones that compromise workers rights (Gray, 2009;
Stiglitz, 2006; Klein, 2000; Sewpaul, 2006; Steger and Roy,
2010). Trade liberalization and unfair trade has often resulted
in massive imports, which undermine local production and
prices, and increased unemployment, which places enormous
strains on poor people, and contributes to children dropping
out of school, women and child trafcking, engaging in
dangerous work, starvation, and xenophobic outbursts, issues
that social workers engage with on a daily basis. The WTO
remains a site of marked resistance on account of unfair trade
practices, with the US government using it to protect the market
for its multinational corporations with devastating effects on
smaller-scale business within the developing world (Gray, 2009;
Nixon, 2010; Stiglitz, 2006; Steger and Roy, 2010). The
subsidies, what Nixon (2010: p. 260) calls perverse subsidies
that amount to about US$2 trillion a year, include subsidies
from rich country governments like the United States, Europe,
and Japan that produce cheaper agricultural imports against
which farmers in the developing world cannot compete. This
practice exposes the hypocrisy of rich countries that argue no
subsidies for agricultural products while doing precisely that
in their own countries. Another player on the global bloc,
threatening domestic production and employment, is China,
with an inux of Chinese trade across the globe setting ablaze
anger at the destruction of domestic livelihoods (Reuters,
2012). Local producers cannot compete against a range of
cheap Chinese imports of clothes, shoes, toys, crockery, and
electronics. Chinese goods accounted for 18% of South
Africas imports in 2012, up from 2% in 1995. With the

Neoliberalism

Eurozone crisis and a declining European market, China has

been increasingly turning its trade interest to Africa, with
Africa now accounting for about 70% of the revenue of some
Chinese companies (Reuters, 2012).
With growing intolerance for lack of government regulation, people are taking measures into their own hands with
violence and threats of violence. One Malawian merchant was
reported to have said: One day there will be blood (Reuters,
2012: p. 13). In South Africa, xenophobic attacks, linked to
socioeconomic deprivations, has seen blood and this seems to
be spilling over to Chinese migrants. In November 2011, four
Chinese were murdered in South Africa (Reuters, 2012). In
August 2012, Kenyans protested with placards that said:
Chinese must go. If no attempts are made to regulate trade,
it is likely that there will be increased backlashes against
cheap Chinese imports. Yet, political leaders go against their
own professed understandings. In July 2012, Jacob Zuma in
Beijing talked about the importance of exercising caution
when entering partnerships with other economies and he
said that the trade relationship was unsustainable in the long
term (Hook, 2012: p. 1, my emphasis). But it is in the
immediate and short term that people have to feed, clothe,
educate, and care for themselves and their children. The
consequences of these discourses and policies for social work
practice are self-evident, as social workers are at the forefront
of dealing with the various manifestations of poverty and
inequality.

Conclusion
The austerity measures imposed by the WB and the IMF and
liberalization of trade continue to have devastating effects upon
people, culminating in the current neoliberal crisis, which
heralds a new multipolar world with the emerging economies
of China, India, and Brazil being less dependent on the United
States (Dumnil and Lvy, 2011), and which has generated
a range of oppositional movements. From small-scale protest
actions in various parts of the world to the Arab Spring and
the international Occupy Movement, lies the core-underlying
theme of citizen intolerance of political authoritarianism,
poverty and inequality, and exclusion in its various forms
(Tormey, 2012; Wight, 2012). However, whether or not the
current neoliberal crisis will allow for a transition toward
a new world order beyond neoliberalism is open to question.
Steger and Roy (2010: p. 137) predict that if the crisis
continues or deepens both third-wave neoliberalism (of
a more moderate kind than its two predecessors) and
a global new deal (built on Keynesian principles) are distinct
possibilities for the second decade of the twenty-rst century
(p. 137), while Dumnil and Lvy (2011) are optimistic that
the crisis might favor a transition evocative of the New Deal
(p. 333). Given the hegemony of neoliberalism and its
entrenched institutions and practices in favor of capitalist
elites, who are not willing to give up their privileged
positions, this will require a very strong counterhegemonic
discourse to neoliberalism, envisioning another and a better
world based on egalitarianism and emancipatory politics
(Stiglitz, 2006; Nixon, 2010) and ensuring that popular
global justice movements continue the pressure in

467

challenging global capitalism. The hope for a better world is

borne out of the ongoing struggle of the Arab revolution
and in people becoming aware of the legitimating power of
neoliberal capitalism, as seen in the international Occupy
Movement.

See also: Disposable Youth in America in the Age of

Neoliberalism; Governmentality; Liberalism, Anthropology of;
Liberalism: Historical Aspects; New Managerialism and New
Public Sector Management; Policy Knowledge: New Liberalism;
Poverty Policy; Poverty, Geography of; Poverty, Sociology of;
Trade Unions and Social Work: Lessons from Canada; Welfare
Economics; Welfare Reform; Welfare Retrenchment; Welfare
State, History of.

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