The NSW government has left some councils with hefty bills to pay since their forced amalgamations in May last year.
Government News understands that mergers have ended up costing some NSW councils more than the state government merger and transition funding they were given.
Rural and regional councils, in particular, are resentful because they received only half of what metropolitan councils were given to cover the process and yet they often receive much less from rates and have lower reserves.
Rural and regional councils received $5 million for each merger, while metropolitan councils were handed $10 million for their mergers under the state government’s New Council Implementation Fund (NCIF).
But there were caveats. The funding could only be used for certain things, such as getting expert advice and integrating IT systems, but not to pay ongoing staff costs or council administrators, who replace councillors and mayors until the local government elections in September.
Councils were also given between $10 to $15 million of Stronger Communities funding to go towards community projects and infrastructure.
Despite the funding, some councils are finding there is a reality gap.
Greens MP and Local Government Spokesperson David Shoebridge said residents of the three former council areas would be ‘shaking their heads’ at the figures and wondering where the $1.5 million extra would come from.
“Every independent expert said at the start of this process that amalgamations would be more expensive and more disruptive than the government pretended, and now we are seeing this come true,” Mr Shoebridge said.
“The incompetence of the Coalition is really staggering, and now they are expecting residents in the local councils they have destroyed to meet the cost of their failure.”
GLADYS Berejiklian may not have performed her last backflip, as I understand it, with serious talk in cabinet in recent weeks around some sort of windback on local council amalgamations.
Two ministers, Planning Minister Anthony Roberts and Better Regulation Minister Matt Kean, recently argued strongly in cabinet that the council amalgamations stood to hurt the government very badly in September local government elections.
Roberts actually argued for areas that have already amalgamated to be allowed to hold plebiscites to see if people still agreed with those amalgamations, according to my sources.
Front of mind for Roberts, the member for Lane Cove, is controversy around the proposed amalgamation of Hunters Hill Council with Lane Cove Council, which is still before the courts.
Apparently Gladys Berejiklian shut down the discussion, which took place in the “political discussion” part of cabinet.
But the council rumour mill also holds suggestions the government is preparing for the eventuality of plebiscites in some areas.
One of the reasons the issue is back on the agenda is the fact that Woollahra Council has won special leave to appeal in the High Court against its amalgamation with Randwick and Waverley councils.
Should Woollahra ultimately triumph in the High Court, the government would be under great pressure to reverse all city council mergers still before the courts.
It is said that Baird was the one who was all the way with the levy and that Berejiklian as treasurer at the time was forced to carry on the policy.
Then there is concern — as several councils continue their appeals against the government’s wish to merge them — that there is the spectre of councils just mounting more and more challenges in the courts.
For example, Hunters Hill Council could no sooner lose its court battle then it would lodge another appeal on different grounds. And so it would go on and on, with all of us paying for it.
Kean and Roberts both raised concerns, I am told, in the cabinet meeting about a fortnight ago that Liberal council candidates are set to “get smashed” in the September local government elections by voters unhappy with their merger deals, with Hornsby having ceded some of its area to Parramatta council, for example.
Some ministers are saying this is another “mess that Mike Baird gifted Gladys” on top of continuing fallout over the failed greyhound racing ban and on top of the proposed introduction of the Emergency Services Levy, which Ms Berejiklian “deferred” (read: dumped) last week.
It is said that Baird was the one who was all the way with the levy and that Berejiklian as treasurer at the time was forced to carry on the policy.
Now, as premier, Berejiklian has been forced to dump it and embarrass herself.
And, again, there is a similar feeling around mergers.
But while ever the premier defends the decisions Mike Baird took, saying she was in cabinet at the time and supported them, the more she suffers for them.
I’ve always been a supporter of there being fewer councils in Sydney. But Baird really needed to go to the Upper House to pass the legislation to make it so, not just push it through the Boundaries Commission. Thanks to this, he created a process which has allowed the court challenges to occur.
But Fred Nile opposing the amalgamations ruined the original plan.
Baird appeared in a hurry to get the mergers through, come hell or high water, when he could have negotiated further with the Upper House.
Now we know why he was in such a rush. He wanted to get all his reforms done and get the hell out of there, to the job at the bank.
In February, shortly after becoming premier, Berejiklian announced that she would walk away from country council mergers currently before the courts but continue with city mergers still in limbo and have the government fight for them to continue in the courts.
Those mergers still in limbo include Strathfield, Burwood and Canada Bay councils; Hornsby and Ku-ring-gai; Hunters Hill, Lane Cove and Ryde; Mosman, North Sydney and Willoughby, and Randwick, Waverley and Woollahra.
Botany Bay and Rockdale councils decided to merge after losing in the Court of Appeal.
The problem with just turning around and dumping those city mergers before the courts — apart from it being another backflip — is that it would lead to protests from those councils which did the right thing and merged, such as the Northern Beaches Council.
But at some point, the Premier has to make the decision as to whether she wants the council amalgamation issue carrying on into the second half of next year, with a state election by then just around the corner, as councils continue to fight in the courts against it.
As you might know, former Pittwater councillor Bob Grace has been working on a community campaign to protect the area into the future.
We are getting in touch to let you know about our crowd-funding campaign, which goes live at 1pm today Tuesday 31 May.
The campaign, run by the community association Protect Pittwater, aims to raise money for legal action to restore Pittwater Council. We are asking you to help us by donating whatever you can.
Our initial goal is to raise $10,000. Any amount donated – however large or small – will help. Bob – a retired barrister – says that’s enough for legal advice and a statement of claim to get us into court.
Any money not used for legal costs will be put towards an ongoing campaign to protect the environment and character of the Pittwater area.
A community meeting in a packed auditorium at Mona Vale has endorsed the formation of a new coalition to campaign for the return of Pittwater Council.
Residents at the meeting endorsed the strategy for a two-pronged approach involving possible legal action and a petition. Print the petition by clicking Proposal to bring back pittwater.
Former Pittwater Councillor Bob Grace said he and a group of community members had formed a new association, Protect Pittwater, with the idea of litigating to restore the council.
Its members include another former Pittwater councillor Sue Young, businessman David Wenden, Northern Beaches Greens Convenor Pip Rey and a former Pittwater Mayor Lynne Czinner.
Mr Grace estimated that to seek legal advice and prepare a statement of claim would cost between $5,000 and $10,000 – so the group was setting up crowd-funding page to finance it.
“I urge you, if you want Pittwater back, we have to fight now,” Mr Grace told the meeting, asking residents to contribute generously.
“ … I hope that when we get the advice from the (legal) counsel, we will institute not only legal action but an interim mandatory injunction – to restrain the Northern Beaches Council from acting as if Pittwater is part of it.”
In response to Mr Grace’s call: “Are you prepared to fight for this?”, residents responded with a resounding “Yes.”
Please print this form out from the .pdf file here, get as many people to sign and send back to David Shoebridge.
When speaking to Mr. Grace on Friday he stated, “When you look at the recent decisions regarding Ku-Ring-Gai and Woollhara council, we believe we have a good case and can win. We would certainly not require so much (funding) of what they have had to do to get to this stage – we would only have to fit within the decisions made there, and we do.”
Greens MLC and local government spokesperson David Shoebridge recommended a second strategy for the new association’s campaign, with a petition to the state government.
“There is a process where, if you get 250 residents or 10 per cent of the former Pittwater area to sign on to a lawful petition, you can actually (go to) the minister and demand a public inquiry about de-amalgamation,” Mr Shoebridge said.
However, Mr Shoebridge agreed Pittwater residents had a good basis to commence legal proceedings, following the success of the Kur-ring-gai action and Woolhahra winning the right to appeal in the High Court.
“There’s a lesson there about the reality of power in NSW,” he told the forum hosted by Northern beaches Greens.
“They won’t listen to you unless you have something to actually make them listen to you.
“That’s what court proceedings do.”
Founding convenor of the independent Better Planning Network, Corinne Fisher, told residents that by banding together to campaign for the restoration of Pittwater they would have a lot of power.
“I’ve learned that you generally don’t convince politicians with rational argument,” she said.
“You mostly convince politicians because power is on your side.
“Any politician cares about keeping their position and if you can present a threat to them securing their position again … then that means you have power on your side and can achieve the win you’re after.”
Craig Boaden, President of Pittwater Forever – a coalition of 18 residents’ groups – said his members had agreed to support the new association.
And Friends of Mona Vale spokesman Mark Edwards kicked off fundraising for Protect Pittwater with a $200 donation from the group, along with Mr Shoebridge who donated $100.
Residents are gearing up to push NSW Premier Gladys Berejiklian to deamalgamate NSW councils forcibly merged in May last year, galvanised by recent court successes of two councils opposing their mergers.
Ku-ring-gai Council, on Sydney’s upper north shore, scored a victory against the NSW government in March when the Court of Appeal found it had been “denied procedural process” during its merger because delegate Garry West relied on a report from consultants KPMG, which contained financial modelling that the council could not access.
The state government was ordered to pay the council’s costs and decided not to appeal the decision but Ms Berejiklian has made it clear she will not back down on the merger and her next move is uncertain.
Rebel councils had another opportunity to celebrate after Woollahra Council was granted special leave to appeal against its forced merger with Randwick and Waverley in the High Court last week, reigniting the council’s hopes after a failed attempt to challenge the legality of its amalgamation in the Land and Environment Court in December last year.
The Ku-ring-gai and Woollahra cases have helped inspire the recent formation of two residents’ groups, which are hoping to stop some mergers and deamalgamate others.
Local Democracy Matters represents people opposed to the merger of Woollahra, Randwick and Waverley Councils, which is still on the cards.
Protect Pittwater is pushing for the succession of Pittwater from the Northern Beaches Council, which emerged from the former Manly, Pittwater and Warringah Councils in May last year.
Both groups are considering their options and legal challenges are likely.
Protect Pittwater is also planning to submit a proposal to the NSW Local Government Minister to redefine council boundaries and reinstate Pittwater Council under the NSW Local Government Act but first the group must gather the signatures of 250 of the enrolled voters for the area; or 10 per cent, whichever is greater.
Minister Gabrielle Upton, would then have to refer the proposal for examination and report to the Boundaries Commission or to the Departmental Chief Executive if the action was taken under Section 218E of the act, which deals with boundary alterations.
This could kick off the whole delegate, public hearing process all over again.
Bob Grace from Protect Pittwater, who served for three years on Warringah Council and 20 years on Pittwater Council, said the action was necessary to protect the area from high rises and dense development, similar to that already visited upon Manly and Dee Why.
He said there would only be three councillors out of 15 on the Northern Beaches council after the September local government elections and Warringah would hold sway.
“They’ve sold us out and I think everyone agrees with that. We will win this case if we go to court,” Mr Grace, a retired barrister, said. “There is really strong feeling up here. People in Pittwater are different. They don’t want a vibrant atmosphere like Manly and they don’t want high rise.”
The group will crowdfund the money needed for legal fees.
“Crowdfunding will enable the community to contribute and take action on their [own] behalf. They can get their council back if they want to contribute,” Mr Grace said.
“People are realising that this Northern Beaches Council is all spin. Services are going down and staff are leaving.”
The Pittwater community should unite to protect the area’s environment and character from massive development, speakers will say at a forum this month.
Former Pittwater Councillor Bob Grace, Better Planning Network founding convenor Corinne Fisher and Greens MLC David Shoebridge have confirmed they will address the forum, “Protecting Pittwater: Where to From Here?” at Pittwater RSL on Tuesday May 16, at 7pm.
The forum follows a number of recent rallies concerned about the B-Line bus, its role as a catalyst for development and calls for Pittwater Council to be demerged.
Mr Grace will invite residents at the forum to support his plans for a crowd-funding page to finance legal action aiming to restore the council.
“The crowd funding page is progressing. Clareville local Pip Rey is putting it together and we hope to have it ready and circulating by mid-May,” Mr Grace said.
“This will be very exciting because it will enable the community to understand what we’re trying to do and how they can help so we can get our Pittwater back.”
Another major issue to be discussed on the night is the impact on the Pittwater area of the new government planning body, the Greater Sydney Commission (GSC).
Its plans for massive development include a commercial centre at the new hospital at Frenchs Forest, the Ingleside housing estate and a ramped up Mona Vale town centre
Submissions on the plan – which must be implemented by local governments – closed last month without an elected council in place on the Northern Beaches.
Ms Fisher – whose network is not affiliated with any political party – will give insights at the forum into how the community can fight inappropriate development.
She encouraged the Pittwater community to band together in a grassroots campaign to protect the area.
“By growing community awareness of the impacts of development, encouraging media coverage and putting pressure on local politicians, residents can work together to protect what they love about their neighbourhood,” Ms Fisher said.
The network, with a membership of more than 460 community groups, was founded in 2012 over concerns about NSW government planning reforms. Its members believe planning should centre on community well-being and environmental protection.
Mr Shoebridge, who will speak about his bill for council demergers and problems with the GSC, said it was heartening to see the community standing up for local democracy.
“The Ku-ring-gai Court of Appeal decision [which found that the plan to merge that council with Hornsby could not proceed in the current form] could have an impact on every forced amalgamation that has either happened or been threatened to date,” Mr Shoebridge said.
Residents attending the forum will have an opportunity to join in the discussion and a number of other community representatives have been invited to speak.
from Miranda Korzy
Pittwater Forever is distributing this information for the information of members and others. This is not a PFE initiative
Imagine if the people of the Soviet Union had never heard of communism. The ideology that dominates our lives has, for most of us, no name. Mention it in conversation and you’ll be rewarded with a shrug. Even if your listeners have heard the term before, they will struggle to define it. Neoliberalism: do you know what it is?
Its anonymity is both a symptom and cause of its power. It has played a major role in a remarkable variety of crises: the financial meltdown of 2007‑8, the offshoring of wealth and power, of which the Panama Papers offer us merely a glimpse, the slow collapse of public health and education, resurgent child poverty, the epidemic of loneliness, the collapse of ecosystems, the rise of Donald Trump. But we respond to these crises as if they emerge in isolation, apparently unaware that they have all been either catalysed or exacerbated by the same coherent philosophy; a philosophy that has – or had – a name. What greater power can there be than to operate namelessly?
So pervasive has neoliberalism become that we seldom even recognise it as an ideology. We appear to accept the proposition that this utopian, millenarian faith describes a neutral force; a kind of biological law, like Darwin’s theory of evolution. But the philosophy arose as a conscious attempt to reshape human life and shift the focus of power.
Neoliberalism sees competition as the defining characteristic of human relations. It redefines citizens as consumers, whose democratic choices are best exercised by buying and selling, a process that rewards merit and punishes inefficiency. It maintains that “the market” delivers benefits that could never be achieved by planning.
Attempts to limit competition are treated as inimical to liberty. Tax and regulation should be minimised, public services should be privatised. The organisation of labour and collective bargaining by trade unions are portrayed as market distortions that impede the formation of a natural hierarchy of winners and losers. Inequality is recast as virtuous: a reward for utility and a generator of wealth, which trickles down to enrich everyone. Efforts to create a more equal society are both counterproductive and morally corrosive. The market ensures that everyone gets what they deserve.
We internalise and reproduce its creeds. The rich persuade themselves that they acquired their wealth through merit, ignoring the advantages – such as education, inheritance and class – that may have helped to secure it. The poor begin to blame themselves for their failures, even when they can do little to change their circumstances.
Never mind structural unemployment: if you don’t have a job it’s because you are unenterprising. Never mind the impossible costs of housing: if your credit card is maxed out, you’re feckless and improvident. Never mind that your children no longer have a school playing field: if they get fat, it’s your fault. In a world governed by competition, those who fall behind become defined and self-defined as losers.
Among the results, as Paul Verhaeghe documents in his book What About Me? are epidemics of self-harm, eating disorders, depression, loneliness, performance anxiety and social phobia. Perhaps it’s unsurprising that Britain, in which neoliberal ideology has been most rigorously applied, is the loneliness capital of Europe. We are all neoliberals now.
The term neoliberalism was coined at a meeting in Paris in 1938. Among the delegates were two men who came to define the ideology, Ludwig von Mises and Friedrich Hayek. Both exiles from Austria, they saw social democracy, exemplified by Franklin Roosevelt’s New Deal and the gradual development of Britain’s welfare state, as manifestations of a collectivism that occupied the same spectrum as nazism and communism.
In The Road to Serfdom, published in 1944, Hayek argued that government planning, by crushing individualism, would lead inexorably to totalitarian control. Like Mises’s book Bureaucracy, The Road to Serfdom was widely read. It came to the attention of some very wealthy people, who saw in the philosophy an opportunity to free themselves from regulation and tax. When, in 1947, Hayek founded the first organisation that would spread the doctrine of neoliberalism – the Mont Pelerin Society – it was supported financially by millionaires and their foundations.
As it evolved, neoliberalism became more strident. Hayek’s view that governments should regulate competition to prevent monopolies from forming gave way – among American apostles such as Milton Friedman – to the belief that monopoly power could be seen as a reward for efficiency.
Something else happened during this transition: the movement lost its name. In 1951, Friedman was happy to describe himself as a neoliberal. But soon after that, the term began to disappear. Stranger still, even as the ideology became crisper and the movement more coherent, the lost name was not replaced by any common alternative.
At first, despite its lavish funding, neoliberalism remained at the margins. The postwar consensus was almost universal: John Maynard Keynes’s economic prescriptions were widely applied, full employment and the relief of poverty were common goals in the US and much of western Europe, top rates of tax were high and governments sought social outcomes without embarrassment, developing new public services and safety nets.
But in the 1970s, when Keynesian policies began to fall apart and economic crises struck on both sides of the Atlantic, neoliberal ideas began to enter the mainstream. As Friedman remarked, “when the time came that you had to change … there was an alternative ready there to be picked up”. With the help of sympathetic journalists and political advisers, elements of neoliberalism, especially its prescriptions for monetary policy, were adopted by Jimmy Carter’s administration in the US and Jim Callaghan’s government in Britain.
After Margaret Thatcher and Ronald Reagan took power, the rest of the package soon followed: massive tax cuts for the rich, the crushing of trade unions, deregulation, privatisation, outsourcing and competition in public services. Through the IMF, the World Bank, the Maastricht treaty and the World Trade Organisation, neoliberal policies were imposed – often without democratic consent – on much of the world. Most remarkable was its adoption among parties that once belonged to the left: Labour and the Democrats, for example. As Stedman Jones notes, “it is hard to think of another utopia to have been as fully realised.”
It may seem strange that a doctrine promising choice and freedom should have been promoted with the slogan “there is no alternative”. But, as Hayek remarked on a visit to Pinochet’s Chile – one of the first nations in which the programme was comprehensively applied – “my personal preference leans toward a liberal dictatorship rather than toward a democratic government devoid of liberalism”. The freedom that neoliberalism offers, which sounds so beguiling when expressed in general terms, turns out to mean freedom for the pike, not for the minnows.
Freedom from trade unions and collective bargaining means the freedom to suppress wages. Freedom from regulation means the freedom to poison rivers, endanger workers, charge iniquitous rates of interest and design exotic financial instruments. Freedom from tax means freedom from the distribution of wealth that lifts people out of poverty.
As Naomi Klein documents in The Shock Doctrine, neoliberal theorists advocated the use of crises to impose unpopular policies while people were distracted: for example, in the aftermath of Pinochet’s coup, the Iraq war and Hurricane Katrina, which Friedman described as “an opportunity to radically reform the educational system” in New Orleans.
Where neoliberal policies cannot be imposed domestically, they are imposed internationally, through trade treaties incorporating “investor-state dispute settlement”: offshore tribunals in which corporations can press for the removal of social and environmental protections. When parliaments have voted to restrict sales of cigarettes, protect water supplies from mining companies, freeze energy bills or prevent pharmaceutical firms from ripping off the state, corporations have sued, often successfully. Democracy is reduced to theatre.
Another paradox of neoliberalism is that universal competition relies upon universal quantification and comparison. The result is that workers, job-seekers and public services of every kind are subject to a pettifogging, stifling regime of assessment and monitoring, designed to identify the winners and punish the losers. The doctrine that Von Mises proposed would free us from the bureaucratic nightmare of central planning has instead created one.
Neoliberalism was not conceived as a self-serving racket, but it rapidly became one. Economic growth has been markedly slower in the neoliberal era (since 1980 in Britain and the US) than it was in the preceding decades; but not for the very rich. Inequality in the distribution of both income and wealth, after 60 years of decline, rose rapidly in this era, due to the smashing of trade unions, tax reductions, rising rents, privatisation and deregulation.
The privatisation or marketisation of public services such as energy, water, trains, health, education, roads and prisons has enabled corporations to set up tollbooths in front of essential assets and charge rent, either to citizens or to government, for their use. Rent is another term for unearned income. When you pay an inflated price for a train ticket, only part of the fare compensates the operators for the money they spend on fuel, wages, rolling stock and other outlays. The rest reflects the fact that they have you over a barrel.
Those who own and run the UK’s privatised or semi-privatised services make stupendous fortunes by investing little and charging much. In Russia and India, oligarchs acquired state assets through firesales. In Mexico, Carlos Slim was granted control of almost all landline and mobile phone services and soon became the world’s richest man.
Financialisation, as Andrew Sayer notes in Why We Can’t Afford the Rich, has had a similar impact. “Like rent,” he argues, “interest is … unearned income that accrues without any effort”. As the poor become poorer and the rich become richer, the rich acquire increasing control over another crucial asset: money. Interest payments, overwhelmingly, are a transfer of money from the poor to the rich. As property prices and the withdrawal of state funding load people with debt (think of the switch from student grants to student loans), the banks and their executives clean up.
Sayer argues that the past four decades have been characterised by a transfer of wealth not only from the poor to the rich, but within the ranks of the wealthy: from those who make their money by producing new goods or services to those who make their money by controlling existing assets and harvesting rent, interest or capital gains. Earned income has been supplanted by unearned income.
Neoliberal policies are everywhere beset by market failures. Not only are the banks too big to fail, but so are the corporations now charged with delivering public services. As Tony Judt pointed out in Ill Fares the Land, Hayek forgot that vital national services cannot be allowed to collapse, which means that competition cannot run its course. Business takes the profits, the state keeps the risk.
The greater the failure, the more extreme the ideology becomes. Governments use neoliberal crises as both excuse and opportunity to cut taxes, privatise remaining public services, rip holes in the social safety net, deregulate corporations and re-regulate citizens. The self-hating state now sinks its teeth into every organ of the public sector.
Perhaps the most dangerous impact of neoliberalism is not the economic crises it has caused, but the political crisis. As the domain of the state is reduced, our ability to change the course of our lives through voting also contracts. Instead, neoliberal theory asserts, people can exercise choice through spending. But some have more to spend than others: in the great consumer or shareholder democracy, votes are not equally distributed. The result is a disempowerment of the poor and middle. As parties of the right and former left adopt similar neoliberal policies, disempowerment turns to disenfranchisement. Large numbers of people have been shed from politics.
Chris Hedges remarks that “fascist movements build their base not from the politically active but the politically inactive, the ‘losers’ who feel, often correctly, they have no voice or role to play in the political establishment”. When political debate no longer speaks to us, people become responsive instead to slogans, symbols and sensation. To the admirers of Trump, for example, facts and arguments appear irrelevant.
Judt explained that when the thick mesh of interactions between people and the state has been reduced to nothing but authority and obedience, the only remaining force that binds us is state power. The totalitarianism Hayek feared is more likely to emerge when governments, having lost the moral authority that arises from the delivery of public services, are reduced to “cajoling, threatening and ultimately coercing people to obey them”.
Like communism, neoliberalism is the God that failed. But the zombie doctrine staggers on, and one of the reasons is its anonymity. Or rather, a cluster of anonymities.
The invisible doctrine of the invisible hand is promoted by invisible backers. Slowly, very slowly, we have begun to discover the names of a few of them. We find that the Institute of Economic Affairs, which has argued forcefully in the media against the further regulation of the tobacco industry, has been secretly funded by British American Tobacco since 1963. We discover that Charles and David Koch, two of the richest men in the world, founded the institute that set up the Tea Party movement. We find that Charles Koch, in establishing one of his thinktanks, noted that “in order to avoid undesirable criticism, how the organisation is controlled and directed should not be widely advertised”.
The words used by neoliberalism often conceal more than they elucidate. “The market” sounds like a natural system that might bear upon us equally, like gravity or atmospheric pressure. But it is fraught with power relations. What “the market wants” tends to mean what corporations and their bosses want. “Investment”, as Sayer notes, means two quite different things. One is the funding of productive and socially useful activities, the other is the purchase of existing assets to milk them for rent, interest, dividends and capital gains. Using the same word for different activities “camouflages the sources of wealth”, leading us to confuse wealth extraction with wealth creation.
A century ago, the nouveau riche were disparaged by those who had inherited their money. Entrepreneurs sought social acceptance by passing themselves off as rentiers. Today, the relationship has been reversed: the rentiers and inheritors style themselves entre preneurs. They claim to have earned their unearned income.
The anonymity of neoliberalism is fiercely guarded. Those who are influenced by Hayek, Mises and Friedman tend to reject the term, maintaining – with some justice – that it is used today only pejoratively. But they offer us no substitute. Some describe themselves as classical liberals or libertarians, but these descriptions are both misleading and curiously self-effacing, as they suggest that there is nothing novel about The Road to Serfdom, Bureaucracy or Friedman’s classic work, Capitalism and Freedom.
For all that, there is something admirable about the neoliberal project, at least in its early stages. It was a distinctive, innovative philosophy promoted by a coherent network of thinkers and activists with a clear plan of action. It was patient and persistent. The Road to Serfdom became the path to power.
Neoliberalism’s triumph also reflects the failure of the left. When laissez-faire economics led to catastrophe in 1929, Keynes devised a comprehensive economic theory to replace it. When Keynesian demand management hit the buffers in the 70s, there was an alternative ready. But when neoliberalism fell apart in 2008 there was … nothing. This is why the zombie walks. The left and centre have produced no new general framework of economic thought for 80 years.
Every invocation of Lord Keynes is an admission of failure. To propose Keynesian solutions to the crises of the 21st century is to ignore three obvious problems. It is hard to mobilise people around old ideas; the flaws exposed in the 70s have not gone away; and, most importantly, they have nothing to say about our gravest predicament: the environmental crisis. Keynesianism works by stimulating consumer demand to promote economic growth. Consumer demand and economic growth are the motors of environmental destruction.
What the history of both Keynesianism and neoliberalism show is that it’s not enough to oppose a broken system. A coherent alternative has to be proposed. For Labour, the Democrats and the wider left, the central task should be to develop an economic Apollo programme, a conscious attempt to design a new system, tailored to the demands of the 21st century.