Lai Qingli: End or Mutation
Since the 2008 international financial crisis, neoliberalism has begun to lose its former edge and "aura," becoming an object of reflection, discussion, and even intense controversy. Currently, as the global pandemic continues to spread, the defects and essential nature of neoliberalism have been further exposed, making these disputes increasingly heated and diverse. Some perspectives suggest that neoliberalism has already decayed or even reached its end. So, what is the actual state of neoliberalism? How will it develop in the future? Based on an analysis of the latest research results and representative viewpoints on neoliberalism abroad, this article attempts to judge the current characteristics and future development of neoliberalism according to the logic of history, theory, and practice.
I. Representative Viewpoints of the "End Thesis"
A survey of Western academia reveals that whether it is the Nobel laureate economist Joseph Stiglitz or the prominent eco-Marxist John Bellamy Foster, scholars have successively issued judgments such as "capitalism has failed," "neoliberalism has ended," "we are facing a retreat of the liberal global order," and "confidence in neoliberalism and democracy is declining simultaneously." It seems that the "end of neoliberalism" has become a consensus among a significant number of Western scholars. Representative viewpoints regarding the "neoliberalism end thesis" can be defined across three dimensions: social, economic, and political.
(1) Neoliberalism’s promotion of "inequality" inevitably causes social fragmentation
From a social perspective, representative viewpoints are as follows: Neoliberalism regards competition as the primary feature of social relations, positing that "competition is freedom." It advocates for tax cuts, deregulation, and the privatization of public services, while describing "collective bargaining" by unions as a distortion of the market that hinders the natural formation of "winners" and "losers." The "rich" are believed to have acquired wealth through hard work, while other factors such as education, inheritance, and class are ignored. Conversely, the "poor" who cannot change their situation are attributed to a "lack of effort," and unemployment is explained as a "lack of enterprise." In this way, "inequality" is actually praised. In a world dominated by this "philosophy of inequality," those who fall behind are losers. Therefore, neoliberalism is fundamentally a "philosophy of inequality," largely a 21st-century replica of "evolutionary theory" and "Social Darwinism."
In such a society, faced with the sudden COVID-19 pandemic, chaos has erupted in the West. "The pandemic revealed the structural defects of the social system... inequality continues to expand... these are all the consequences of the imbalance and instability of the system itself." This defect in itself indicates that neoliberalism is on the brink of collapse; if treatment for COVID-19 becomes feasible, the gap between the rich and the poor will undoubtedly widen further. Consequently, some scholars cannot help but ask: "Will the coronavirus lead to the collapse of neoliberalism and reshape global civilization?"
The facts support this. When the interests of capital are placed above all else, the middle class is moving toward extinction, and social inequality is intensifying, the "American Dream" becomes increasingly distant. One of the most important problems currently facing the United States and many countries worldwide is worsening inequality. As the pandemic spread, people felt this inequality more acutely. Looking at the vertical social structure—different classes and strata—when the pandemic arrived, the wealthy "moved" to places far from the outbreak, such as yachts, escaping to safe "second homes." Meanwhile, the middle class bore the dual burden of supervising children's education and working long hours at home. The poor either lost their jobs or risked their lives working low-income jobs, while their families were quarantined in cramped quarters. Looking at the horizontal social structure—different ethnicities and genders—people of color have higher unemployment rates and lower wages, and often engage in hazardous work; female workers are mainly concentrated in sectors such as healthcare, social work, and retail. Against this backdrop, cross-cutting class and ethnic oppositions, and even polarized emotions, continue to rise, making social fragmentation and unrest the norm.
(2) Neoliberalism built upon "unconstrained free markets" amplifies social inequality
From an economic perspective, representative viewpoints are as follows: Neoliberalism is built upon "unconstrained free markets." Its main features include laissez-faire, minimal government intervention, extensive privatization, and the transformation of the state from a provider of public welfare into a promoter of competitive free markets. It is an economic system that has been widely implemented over the past 40-odd years. In other words, neoliberalism is usually associated with the liberalization of international capital flows; it limits union power, dismantles state-owned enterprises, and sells off public assets, allowing the logic of the free market to occupy a dominant position.
Currently, many scholars use terms like "failure" and "inefficacy" to argue that the "unconstrained free market" is unsustainable. They believe a clean break with neoliberalism is necessary, both because the times have changed and because recent solutions are no longer applicable. This is manifested in "the market being unable to meet the needs of the people," and also in the fact that the authority of so-called "groups that promote social progress"—such as "professors, legislators, or jurists—comes more from the market than from humanistic values like public-spiritedness, conscience, or the thirst for justice." The momentum of the free market to drive social progress is gradually drying up, and social inequality is continuously intensifying.
The COVID-19 pandemic further amplified the limitations of the free market and allowed people to see the inequality it brings more clearly. Some scholars have complained that since the pandemic began, Western governments have provided relief services through banks, but the targets of relief were first and foremost large enterprises. The market was "consecrated" once again to financial institutions and corporations. Governments still subscribe to the claims that "privileging the private market will enhance efficiency and promote growth," "the private sector will provide better solutions," and "private investment will enhance productivity and labor compensation." They even believe that excessive help for the poor will lead to "moral hazard." This is the flip side of the leadership's lack of public consciousness and the trend toward the further disappearance of public power (democracy and popular power). Since the onset of the pandemic, the $660 billion loan program launched by the U.S. government was mainly carved up by the big bourgeoisie at the center of power, rather than truly benefiting the small businesses in dire need of funding.
(3) Neoliberalism, with its high-profile proclamations of "liberal democracy," has reached the end of the road
From a political perspective, neoliberalism often claims to be equated with democracy, extolling universal suffrage based on individualism. However, data from the Pew Research Center in the U.S. shows that Americans' trust in the federal government has generally shown a downward trend for years. Since 2007, it has never exceeded 30%, and in recent years it has dropped below 20%, with over 80% of voters distrusting the federal government. Some scholars believe that neoliberal democracy is actually nothing more than "audience democracy" [1] or stylized democracy. The rise of Trump and the emergence of populism and nationalism in Western societies are the results of this "audience democracy." Therefore, some foreign scholars also see this as the end of neoliberal democracy and liberal democratic values, as well as evidence of neoliberalism's inefficacy: lacking the necessary political guarantees and support of democratic legitimacy, neoliberalism is naturally difficult to sustain, and Biden's assumption of power has not brought fundamental changes.
The facts bear this out. From a formal standpoint, neoliberalism—which loudly proclaims democracy and universal values—seems to have reached its end. Right-wing forces hold important or even leading positions in many countries globally. To a large extent, they utilize and promote antagonistic sentiments, especially by standing on the side of the lower-middle class of the so-called majority race. They attack values such as pluralism, compromise, equality, and fraternity, preaching that immigrants and ethnic minorities are the cause of damage to the interests of the existing majority race, while simultaneously attacking nations and states that have benefited from external globalization. They portray themselves as being "on the side of the masses," constantly mobilizing and utilizing antagonistic emotions. Using the fear and dissatisfaction caused by the economic frustration and cultural anxiety of the people in the context of globalization, they combine a political blueprint for reshaping national interests with the political logic of populism. They attempt to bridge the divide between the upper-level financial monopoly capitalists and the lower-level white blue-collar class, constructing a cross-class, heterogeneous alliance. Utilizing the crisis, they direct the people's dissatisfaction and contradictions toward ethnic minorities, illegal immigrants, and different cultures and nations, portraying the latter as the culprits behind social inequality, worsening security issues, the economic decline, and the global spread of the pandemic. Meanwhile, using so-called "alternative facts" as arguments, they stir up fear and unease in American society toward different races, nations, and civilizations, while dressing themselves up as representatives of popular sentiment.
II. Formal Termination and Substantive Mutation
Based on the above observations, it is not difficult to see that the "end of neoliberalism" has become a relatively common view, at least in public opinion. However, there is also a view that neoliberalism "can fully utilize its own failures and continue to progress," and is undergoing diverse changes amidst the voices of "continual demise." If we trace the changes in neoliberalism from historical, theoretical, and practical levels to grasp its essence, we will see that these changes may not truly signify an end.
First, the critique of the "inequality thesis" is insufficient to prove the end of neoliberalism, because the "regulatory mechanisms" within contemporary liberalism have failed, and neoliberalism has gradually become a product of mixed ideologies.
The previous viewpoints suggested that neoliberalism’s promotion of a "philosophy of inequality" has already caused social fragmentation, and the evil consequences of the gradually expanding social inequality have made neoliberalism unsustainable. However, proving the end of neoliberalism by critiquing inequality often overlooks two points: first, the "regulatory mechanisms" within liberalism that addressed the "inequality thesis" have gradually dissolved; second, contemporary neoliberalism has gradually become a mixture of multiple ideas, and has even become a member of the ranks opposing the "inequality thesis."
From a theoretical perspective, the philosophy of figures such as Friedrich August von Hayek is itself an "inequality thesis." In their view, on the one hand, "men are born different," meaning that "the infinite diversity of human nature—the wide range of differences in individual capacities and potentials—is one of the most distinctive facts about the human race." The inherent differences between individuals also dictate that achieving wealth redistribution and wealth equality through the government will lead to actual inequality between individuals, and even inequality before the law. Regarding equality of everyone before the law versus equality of everyone regarding material wealth, liberalism can only achieve the former; to protect individual liberty, material equality must never be achieved through government power and state coercion. On the other hand, inequality is the driving force of social progress. The wealthy drive social progress by trying out new lifestyles; if the wealthy did not make these unattainable "contributions," then social progress would be slow. Thus, in the entire process of social progress, the lead held by the wealthy is only relative, and poverty is also only relative. "As long as inequality is not the result of human design or the decision of a power authority, but is brought about by an impersonal market process, then such inequality is entirely rational."
Historically, what Hayek supported and opposed were actually what Isaiah Berlin summarized as "negative liberty" and "positive liberty." Positive liberty (liberty to) can be seen as "affirmative liberty," affirming that an object or individual has the right to decide what others should do; negative liberty (liberty from) can be seen as "denying liberty," denying the power of others to interfere with the self. In terms of property rights, negative liberty advocates that "protecting private property rights is the only effective means of protecting liberty," while positive liberty advocates "safeguarding the lives of the majority of people through state intervention." Since the birth of liberalism, scholars who advocate "negative liberty" have mostly advocated the freedom of individuals to pursue wealth, equating liberty with the protection of private property and the maintenance of market competition, believing that the requirements of equality in wealth redistribution will hinder liberty.
From a practical perspective, liberals who promoted "positive liberty" saw the evil consequences brought by the original "negative liberty." In late 19th and early 20th century Britain, "self-regulation" within liberalism produced "New Liberalism." Subsequently, utilitarianism and Keynesianism became its important supports. Alongside Western Europe’s democratic socialism and the New Deal across the Atlantic, these constituted so-called "Progressive" politics, jointly shaping the welfare states and societies of post-WWII Western Europe and effectively practicing "positive liberty."
Since the stagflation crisis of the 1970s, Keynesianism has failed, and neoclassical liberalism has taken the stage. During this period, the tension within liberalism manifested as a debate between the "new liberalism" of figures like John Rawls and Ronald Myles Dworkin—who defined positive liberty, advocated for justice, supported the welfare state, and asserted socio-economic rights and civil liberties—and the emphasis placed by F.A. Hayek and others on negative liberty, the primacy of the market economy, and private property. In the 1990s, the tension between these two trends moved toward convergence in the "Third Way" or "New Middle Way" championed by Tony Blair, Bill Clinton, and Gerhard Schröder. In this process of integration, the economic foundation of new liberalism was gradually eroded as it co-opted the neoclassical liberalism of Margaret Thatcher and Ronald Reagan, reduced market regulation, and shaped universal values such as pluralism, respect, and compromise as a means to humanize neoclassical liberalism. On the other hand, neoclassical liberalism constantly consolidated its position through neoconservatism, promoting market capitalism, libertarianism (which advocates for reduced government intervention), religious conservatism, social conservatism, and nationalism. Consequently, from a practical standpoint, positive liberty has co-opted negative liberty in the economic sphere, causing the internal regulatory mechanisms of liberalism to gradually fail. Liberalism has converged with negative liberty and retreated into the cultural sphere, while the economic foundation of "progressive" politics has gradually dissolved. Substantive positive liberty has become negative liberty de facto; while it opposes inequality, it simultaneously promotes it.
Therefore, contemporary neoliberalism has evolved into a hybrid of a new liberalism that has retreated into the cultural sphere and a neoclassical liberalism that occupies a dominant position in the economic sphere. This has caused a mutation in contemporary neoliberalism, making it a "mutated neoliberalism": it utilizes the new liberalism that originally sat on the center-left of the political spectrum to absorb "progressive" concepts, making itself a proponent of "equality" or even "extreme equality," while proceeding to implement economic policies characterized by neoclassical liberalism. More importantly, new liberalism has already lost the economic discourse power once held by Keynesianism; it can only carry out formal reforms in the cultural sphere that do not touch the essence of the "theory of inequality," while remaining economically subordinate to neoclassical liberalism. Thus, it is still too early to argue that neoliberalism has ended or is coming to an end based on the "theory of inequality."
Second, the argument regarding the "failure of the free market" likewise cannot prove the end of neoliberalism, because mutated neoliberalism is gradually reclaiming the historical intellectual resources of government intervention.
As mentioned previously, people often define neoliberalism by the unconstrained free market and use the dire consequences of the free market as evidence that neoliberalism has ended or is bound to end, thereby advocating for measures such as government intervention. In reality, however, neoclassical liberalism does not advocate for an unconstrained free market; it was itself a reflection on 19th-century laissez-faire liberalism and emphasizes the application of state power. Thus, the evils brought about by unconstrained free markets do not signify the end of neoliberalism, but rather serve as a driving force for it to further seize government power to readjust and reconstruct the free market.
From historical and theoretical perspectives, neoclassical liberalism has its own developmental genealogy. In this genealogy, one can clearly see that mutated neoliberalism cannot be simply defined as a theory of the free market or laissez-faire. Historically, the birthplace of neoclassical liberalism was the Vienna Chamber of Commerce, where the first study Hayek assisted Ludwig von Mises with concerned the Treaty of Saint-Germain-en-Laye. Its purpose was to guarantee market order through international legal and institutional arrangements; thus, neoclassical liberalism is sometimes referred to as "legal interventionism." Some scholars use the term "encasing" to describe this legal interventionism—that is, using top-level domestic and international legal designs by a small elite to "encase" the order of market competition, protecting the global market from the influence and interference of democratic politics.
France was also an important origin for contemporary neoclassical liberalism. In 1938, the Walter Lippmann Colloquium was held in France, and the "Declaration of Liberalism" adopted by the meeting first emphasized legal intervention by the state—namely, that the state must construct a legal framework for the free development of economic activities. Secondly, it argued that government power must be expanded: a liberal state must use taxation to secure national defense, provide social services, and guarantee scientific research. Finally, it proposed that the government should exercise broader powers of intervention. Even earlier, French neoclassical liberals called themselves a "Third Way" between laissez-faire and the planned economy: unlike the former, which "lets the car drive in any direction," and unlike the latter, which "tells every car which direction to drive," they sought to establish laws that "allow the cars to drive freely."
After World War II, the so-called "Social Market Economy" system of West Germany was sometimes viewed as an alternative to neoclassical liberalism. This, however, obscured the similarities between the economic policies of the post-war West German government and neoclassical liberalism, as well as the Mont Pelerin Society's design of West German economic and social policies. The primary theoretical provider of the Social Market Economy was undoubtedly Ordoliberalism, and Ordoliberalism clearly shares commonalities with legal interventionism in its understanding of the relationship between law and economics.
Divorced from Anglo-American centrism, neoclassical liberalism is not entirely equivalent to laissez-faire or the free market; rather, it possesses rich intellectual resources and practical experiences in exerting the role of government intervention. Therefore, the failure of laissez-faire or the free market cannot prove the end of neoclassical liberalism. On the contrary, viewed genealogically, neoliberalism is to some extent a prescription for the unconstrained free market. Consequently, the failure of the free market does not mean the failure of contemporary neoliberalism; rather, neoliberalism is seizing government power to reconstruct the free market through state intervention. Currently, legal interventionism remains a sharp tool for the United States. Both Trump and Biden have been reshaping the government in hopes of improving national capacity, increasing government power, continuously molding the superiority of the American system, and enhancing competitiveness. On this basis, the U.S. uses means such as "long-arm jurisdiction" [2] to extend the jurisdiction of American law to non-American enterprises and individuals. It continuously shapes the legal system through national capacity and government power, constructing jurisdiction over multinational corporations and individuals in the context of globalization, thereby forming what is called "just conduct" to maintain the free market.
Third, whether "democracy" is failing is not the criterion for judging the end of neoliberalism, because mutated neoliberalism is gradually combining with various political forms.
As mentioned above, some argue that the rise of figures like Trump and the failure of democracy largely signify the failure of contemporary neoliberalism. In fact, however, events like Trump's election do not mean the end of neoliberalism. Historically, neoclassical liberalism has been able to combine with various political forms; "democracy" is a tool for neoclassical liberalism to advance its hegemony, and when democracy fails, "illiberal democracy" becomes a temporary substitute for neoclassical liberal political hegemony.
Theoretically, whether democracy fails is not the key to the survival of neoclassical liberalism. On the one hand, neoclassical liberalism is fundamentally opposed to market regulation and the redistribution of wealth; on the other hand, it must rely on government power and intervention to guarantee the global free flow of capital and corporate funds. Thus, the main role of democracy lies in maintaining the political authority and hegemony of neoclassical liberalism and in dressing up the pluralistic values required for capital or financial globalization. This is particularly evident in the market's transformation of democracy: neoclassical liberalism has changed the function of democracy through competitive markets and the exercise of government power. Democracy—originally an institutional system capable of guaranteeing the rights of the majority and preventing their erosion during social change and development—has gradually transformed into a stage irrelevant to the immediate economic interests of the majority. Politicians have become actors who no longer focus on the economy but on culture. One can clearly sense a subversive shift between the public and private spheres: elements long considered part of the public sphere, especially welfare and taxation, are gradually being transferred to the market and private spheres; meanwhile, elements long considered part of the private sphere have entered public life—especially religion, ethnicity, gender, geography, and lifestyle related to individual identity—beginning to serve as topics for constant debate in the public square. Therefore, when an economic crisis unleashes inequality, the relationship between the market and democracy becomes unbalanced, and the democratic agenda shifts toward non-economic fields, economic inequality easily explodes alongside cultural issues.
Practically speaking, mutated neoliberalism still weakens labor rights, imposes strict limits on fiscal deficits, carries out large-scale tax cuts for big capital, sacrifices local production for transnational supply chains, and privatizes public sector assets at one-off prices, and so forth. More importantly, after the failure of democracy, mutated neoliberalism requires a new political pillar. Although the free movement of people is restricted by factors such as the sharp increase in income inequality and the outbreak of the pandemic, capital can cross international borders with relative ease. In fact, global financial sovereignty and the corresponding corporate sovereignty of various countries still exist and are even strengthening.
Before and after Trump's election and during his administration, there was ample support from neoclassical liberal groups—for example, David Koch in the U.S., whose family's fundamental philosophy combined racism and nationalism with the ideas of Hayek and others. Trump also received the full support of the Tea Party; his working-class and petty-bourgeois supporters were bound together through racism, nationalism, religious belief, and patriotism, forming a cross-class cultural alliance with the Tea Party. Similar situations exist in Nordic countries like Denmark and Norway, and in Western European countries like the Netherlands, France, and Germany. In Central and Eastern Europe, neoclassical liberalism has also strangely combined with right-wing forces to continuously advance related economic policies. At the social level, frustrated citizens are more hopeful for an anti-establishment charismatic leader who can express their demands in a way different from any political elite who previously came to power through democratic institutions. Thus, at the political level, "inclusive authoritarianism" and "illiberal democracy" have appeared, and right-wing leaders worldwide have almost all taken relevant actions. Currently, neoliberalism has actually evolved into an updated "conservatism + neoclassical liberalism."
However, if right-wing leaders cannot alleviate social inequality, it may lead to electoral failure, as evidenced by Trump's loss to Biden. Although these right-wing leaders may fail in the short term, as long as the succeeding government still adheres to neoliberal economic policies, they remain strong contenders to regain power. In the absence of an effective alternative model, neoliberalism will continue to persist within the cycle of various value-based regimes.
III. Mutation, and Merely a Return
Based on the above, it is not difficult to see that contemporary neoliberalism encompasses many different concepts, making it difficult to define clearly through a single principle or a few elements. However, by examining the developmental history of neoliberalism—especially the history of its policy development since it officially took the historical stage in the 1970s—we may further clarify where the current mutation of neoliberalism stems from. In this regard, foreign theoretical circles mostly divide its developmental history into three or four stages, the difference being whether they treat the Trump administration as a separate stage. Here, I primarily analyze it through three historical periods.
First, from the 1970s to 1985, primarily reflected in the neoclassical liberal advocacy of Reagan and Thatcher.
During this period, neoclassical liberalism developed in practice, primarily manifested in the following aspects: at the economic level, it encompassed multiple concepts such as monetarist policy, liberalization, privatization, deregulation, "small government," and New Public Management. Many scholars have interpreted it as the global extension of the interests of specific capital and classes, initiating a process of transforming state and government power, whereby transnational corporations began to emerge as the greatest beneficiaries of the globalization process. At the socio-political level, both Reagan and Thatcher emphasized national tradition and patriotism. Thatcher placed particular emphasis on the power of family, religion, community, and traditional morality, highlighting the role of the state and government in the edification and discipline [3] of the citizenry; Reagan, moreover, persisted in advocating "the American spirit," "America First," anti-communism, and racism, engaging in trade wars with countries like Japan and using the "Star Wars" program to exhaust the Soviet Union. Previously, in the UK, the US, and across the Western world, liberalism occupied the "left" of the political spectrum, while conservatism occupied the "right." The former—progressive liberalism—emphasized the role of the government, state, and society in shaping material equality; the latter opposed the functions of the welfare state and government redistribution, advocating for the freedom of enterprises to determine economic activities. From this period onward, liberalism began to merge with conservatism, and neoclassical liberalism was the result of this synthesis.
By the time the Plaza Accord was signed in 1985, the radical and polarized liberalization measures of Thatcher and Reagan had not only triggered internal contradictions but also stimulated increasingly fierce competition in the world economy, releasing a vast amount of antagonistic sentiment. Their attacks on measures that guaranteed labor and protected society, along with their "capital-centric" philosophy, met with increasing opposition. Neoclassical liberalism was forced to undergo internal transformation through a new combination of ideas and policies.
Second, the period from 1986 to 2006 was primarily characterized by the "humanizing" transformation of neoclassical liberalism.
During this period, neoclassical liberalism underwent significant changes. The "Third Way" and the "(Post-)Washington Consensus," represented by Clinton and Blair, gradually became the conceptual propositions and policy paths leading world development for these twenty years. Their main idea was to "humanize" the market, making it widely recognized at the socio-political level. Markets and capital remained central to wealth creation and the maintenance of economic growth, but there was a perceived need to ensure the quality of government services and avoid market disorder. After the drastic changes in the Soviet Union and Eastern Europe [4], democratic socialism transformed into social democracy, emphasizing "progressive" politics rather than socialism and stressing compromise with neoclassical liberalism. The "Third Way" was a repair of the contradictions of the first stage of neoliberalism. Formally, it emphasized rebalancing public and private interests and combining market-based modern government management with private capital; essentially, after losing economic discourse power based on Keynesianism, it represented a compromise with neoclassical liberalism in the economic sphere and a shaping of neoclassical liberalism in the realm of the superstructure. Unlike the first stage, in the realm of the superstructure—although neoconservatism briefly held the upper hand in military and foreign affairs in the United States—it quickly retreated following the moral issues surrounding the Iraq War. "Humanized" neoclassical liberalism identified more closely with globalization, pluralism, and democratization, gradually forming "liberal democracy" into a universal value.
Third, from the outbreak of the US subprime mortgage crisis in 2007 to the present, the period has primarily manifested as a trend toward the polarized development of neoliberalism.
This period is the stage of neoliberalism’s mutation, characterized by a reversion to its first stage and a re-polarization. The outbreak of the international financial crisis posed a major challenge to the "common sense" and "universal values" established during the second stage of neoliberalism. In the context of globalization, individual insecurity within volatile markets triggered widespread discontent. From economic chaos—such as unemployment, shrinking wealth, and wealth polarization—to the rapid fermenting of social inequality, people were prompted to reflect on the development of the past twenty years. However, in public discourse, current neoliberalism is often equated with the "neoliberalism" of the second stage and taken as the object of reflection, while three points are overlooked: first, the historical antecedents and intellectual origins of "neoliberalism"; second, the "neoliberalism" of the first stage; and third, that neoliberalism has already developed into a new stage, which possesses both the characteristics of the second stage and similarities with the "neoliberalism" of the first stage.
Based on the foregoing, it is easy to see that current neoliberalism shares many characteristics with the first stage, which is the historical source of its current mutation. Since 2008, neoliberalism has remained active in the economic sphere: the transformation of government power, further tax cuts for corporations and the wealthy, further deregulation of finance, and more cuts to public services. At the social level, a series of patriotic, nationalist, and even racist sentiments, along with a return to religious and historical traditions, all bear the shadows of the 1970s and 80s. At the political level, with the 2016 ascent of Trump as a boundary: previously, center-left parties adopted neoliberal economic policies to varying degrees, while center-right parties committed to "progressive" politics in exchange for center-left support of neoliberal economic policies; subsequently, center-right parties began to pivot toward alliances with populism, nationalism, religious conservatism, and even racism, exhibiting a polarized tendency. This is also similar to the Thatcher and Reagan era, signifying a change in the political form through which neoliberal economic policies are peddled. Current neoliberalism has become a "chameleon," capable of appearing in the guise of "progressive" politics, returning to its original conservative shell, or forming alliances with populism and the like.
Different from the 1980s is the fact that the external pressure on liberalism has been largely eliminated. After the ebb of Keynesianism, it has been difficult for new liberalism (social liberalism) to exert a substantive influence on the economic field; the center-left has found it difficult to achieve a breakthrough at the level of economic theory compared to "neoclassical liberalism." Within European and American countries, following the neoliberalization of social democracy, it is currently difficult for any center-left force to emerge that could once again "humanize" neoliberalism. More importantly, unlike when it opposed Keynesianism to resolve the stagflation crisis, current neoliberalism is facing a mess of its own making. "Progressive" politics in the sphere of political culture and neoclassical liberalism in the economic sphere have both become objects of opposition. However, neoliberalism will not oppose itself in the economic field; instead, it uses the antagonistic sentiments released through the political-cultural sphere to cover up fundamental problems in the economic domain.
Consequently, for the foreseeable future, based on a philosophy of inequality, the reshaping of free markets through government power, and alliances with various political forms, the antagonistic sentiments between societies, ethnicities, and nations caused by mutated neoliberalism will continue to exist and may even be continually amplified.
IV. Conclusion
The series of phenomena currently appearing in the capitalist world, especially in developed capitalist countries, which run counter to the "common sense" and values of "liberal democracy," are not signs that neoliberalism is moving toward decline or its end. Rather, they are manifestations of its development into a new stage—the product of neoclassical liberalism constantly reclaiming its historical and theoretical origins and merging with new liberalism. In terms of its essence, the ascent of neoclassical liberalism to the historical stage was caused by the cyclical economic crises resulting from the basic contradictions of capitalism. However, it has not, and cannot, fundamentally resolve the basic contradictions of capitalism; instead, it constantly displaces these contradictions and undergoes mutations. The inequality and antagonistic sentiments induced by current neoliberalism are expressed and amplified in various forms. Based on the foregoing, we can summarize this through the following four aspects:
At the political level, a bizarre combination of "negative liberty" and "positive liberty" has formed. After absorbing the concepts of new liberalism (social liberalism), the political spokespersons of neoclassical liberalism are instead able to "hijack" new liberalism, using "egalitarianism" to confuse the masses who have lost material interests in processes such as globalization and industrial restructuring. Thus, we see behaviors pursuing equality in extreme ways under banners such as "protecting society" and "defending national interests."
Economy-level: Under the premise that internal adjustment mechanisms of liberalism have failed, the economic policies of neoclassical liberalism will continue to exist for a long period. Despite attempts to "bury" neoclassical liberalism, countries like the United States are still attempting to solve problems with old methods, continuously strengthening the role of the government as a rational agent for markets and enterprises, further cutting taxes for corporations and the wealthy, deregulating finance, and cutting public services. On the other hand, so-called stimulus plans to increase public spending will face attacks in the neoclassical liberal style, induced by deficits, debt, overheating, and inflation. Thus, some foreign scholars have proposed that although actual policies and institutional operations may appear inconsistent with it, the influence of neoclassical liberalism persists: it possesses rich historical and theoretical sources, economic policies still revolve around it, and the US will continue to maintain its characteristics as a rentier state, relying on the globalized financial sector.
At the cultural level, neoclassical liberalism originally possessed close links with theories and social sentiments such as patriotism and populism. This is even more the case for current neoliberalism. Against the backdrop of a widening interest gap and the continuous release of emotional conflicts between different identity groups, patriotism, populism, nationalism, and even racism have already become means for neoliberalism to seek survival, maintain cultural hegemony, and obscure various essential problems such as economic inequality.
At the international level, current neoliberalism is reclaiming many characteristics from the first stage of its development, manifested in the increase of government power, the strengthening of government force, and the improvement of government capacity. To safeguard national interests, especially the interests of large capital, it does not hesitate to provoke various conflicts and competitions, such as trade wars and tech wars. In particular, the US uses "long-arm jurisdiction" and other means to strive for legal actions that maintain a free market; its essence is the continuous use of government power and legal intervention to sustain its own interests.
Taking it a step further, understanding current neoliberalism also requires a summary starting from cyclical movements. Within the overall cyclical movement of capitalism, neoliberalism also possesses its own cyclical movements, constantly developing itself through combinations with conservatism and progressivism.
From the historical development of the three stages, it is not difficult to see that neoliberalism always seems able to find new space for survival within crises, exhibiting distinct stage-based characteristics. When capitalism is in the "recovery-boom" period, the basic contradictions of capitalism narrow, productive forces rise, wealth creation is relatively high, the role of the market becomes prominent, and the demand of the masses to change the relations of production and social relations decreases; a series of values and universal values characterized by progressivism thus manifest. When capitalism is in the "crisis-depression" period, the basic contradictions of capitalism are magnified, productive forces decline, wealth shrinks, social calls for protection rise, and the demand to change the relations of production and social relations increases; a series of values and social antagonisms characterized by conservatism will thus be continually amplified.
From the perspective of a longer historical cycle, as social protection systems are gradually dismantled in Western developed capitalist countries, while neoliberal economic policies continue to be implemented and the internal self-regulation mechanism of liberalism fails, social calls for self-protection will not diminish. However, because of the decline and failure of democracy and the fact that socialist and communist forces remain at a low ebb, people's calls to change the status quo of inequality are mostly expressed in the form of polarized trends such as populism, nationalism, and even racism. Therefore, facing current crises, the neoliberalism represented by the United States has also entered a development stage characterized by new, polarized forms of conservatism. It cannot be simply assumed that it has moved toward its end.
Therefore, based on realistic and historical perspectives, a basic conclusion can be drawn: current neoliberalism cannot be simply equated with neoclassical liberalism or confused with general liberalism; rather, it is more the product of a mutual fusion between the two. This fusion has also caused "positive liberty" to lose its capacity to restrain, regulate, or substitute for "negative liberty" within the economic sphere, while "negative liberty" has also been able to utilize the concepts of "positive liberty" to maintain its own survival. From this perspective, it can be argued that neoliberalism has not come to an end, nor will it easily do so. In formal terms, neoliberalism will only undergo a fundamental change when "positive liberty" creates an effective economic theory and occupies the discourse power and dominant position in the economic field; in essential terms, given the premise that capitalism and liberalism have not reached their end, neoliberalism will not end. Only by fundamentally discovering, proposing, and walking a path and conceptual framework that can replace capitalism and liberalism can neoliberalism be fundamentally terminated. At present, what we should do is persist in criticizing the polarization and conservative trends of neoliberalism, expose its essence, and, in response to the cyclical changes of capitalism and neoliberalism, continuously interpret the socialist path and concepts that can replace capitalism and liberalism, thereby making continuous contributions to the development of human society.
(This article is a periodic result of the 2017 National Social Science Fund of China Major Project "Research on Socialism with Chinese Characteristics under the Broad Vision, Macro-Pattern, and Global Trend of the Development of World Socialism," Project No. 17ZDA004.)
(About the Author: Lai Qingli, Associate Researcher at the Institute of Chinese Marxism of the Shanghai Academy of Social Sciences, Deputy Director of the Editorial Department of Mao Zedong and Deng Xiaoping Theory Research, and Director of the Shanghai Association of Scientific Socialism.)
Online Editor: Tongxin Source: Contemporary World and Socialism, Issue 1, 2022.