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November 3, 2007
Andrew Wear, writing in the Canberra Times, defines what he calls the 'essence of the neoliberal agenda, known in Australia as economic rationalism' as follows:
Economic rationalism dominated worldwide economic thought throughout the 1980s and 1990s. It was characterised by a faith in the power of markets and competition to deliver prosperity through the "trickle down" effect of economic growth. Implicit in this line of reasoning was that any form of cooperation, collaboration or government intervention is harmful as it inhibits competition.
Why agenda rather than mode of governance? We know that for the past 11 months, Rudd has been engaged in an act — announcing policies he doesn't believe in and has no plans to implement. Telling the public one thing while secretly planning to do another. Shouldn't we be concentrating on the governance of free subjects?
Wear says that though
some aspects of economic rationalism have clearly become normalised, such as budget surpluses and competitive exchange rates, for the most part, other pillars of economic rationalism such as free trade, privatisation, deregulation, union busting, an insistence on individual responsibility and cutting welfare, have been put on hold, abandoned or reversed.
That's odd. What about Workchoices and welfare to work? Welfare to work---designed to coerce single mothers, disability pensioners and others back into the workforce--- may have been forgotten, but Workchoices? Isn't it a core difference between the two major parties in a me-tooism election.
Wear goes to say that:
In contemporary Australia, the fundamental limit of economic rationalism is that because it is principally focused on the efficiency of markets and the minimisation of costs, it has very little to say on innovation or competitive advantage some of the core challenges facing the nation.In a global economy, competitive advantage increasingly derives not from low costs, but from the development of unique niches in the marketplace, often located in particular places. Thus, Silicon Valley specialises in computer technology and Hollywood specialises in movies. In this context, the things that matter are the education levels of its people, linkages between firms, and lifestyle.
I thought the neo-liberal mode of governance emphasized innovation and entrepreneurship--removing deregulation and government to create space for the market to enable innovation and entrepreneurship. If states are to compete successfully in the global economy of the information society, then they need to foster innovation and entrepreneurship. Isn't that the central narrative of our time?
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Gary,
The Australian version seems to favour innovation and entrepreneurship that doesn't disturb the status quo. Small scale good, big scale bad.
Economic rationalism hasn't been applied consistently. Think of the power industries. We haven't had the "cooperation, collaboration or government intervention is harmful as it inhibits competition" theory applied equally to various kinds of energy production.
The biggest problem with pure economic rationalism is that it doesn't take human nature into account. It assumes that you and your nearest and dearest would fight to the death over a dollar. Same as any other brand of rationalism. The theorists got us mixed up with some other species.