by The Rev. Dr. Tex Sample
For over four decades the people of the United States have been under the captivity of policies and actions generally called Neoliberalism. It consists of at least six characteristics.
1. Deregulation. Note, e.g., that the financial system became seriously opaque with the use of derivatives in the early 2000s and few recognized the emerging economic crisis.
2. Tax cuts to big corporate America and wealth. As of 2021 American corporations accounted for 6% of Federal tax revenue in contrast to providing about 30% in the 1950s. Roughly a third (34%) of large, profitable corporations pay nothing in Federal Income Taxes.
3. Privatization: current attempts to end Social Security, Medicare, Medicaid, and to privatize the U. S. Post Office, along with the development of many charter schools.
4. Hyper-globalization: off shoring of industry, technology, jobs, and creation of tax havens for corporate America.
5. Lower wages and the decoupling of productivity and wages.
6. Anti-labor and union busting such as Amazon, Apple, Google, Starbucks, and fast-food companies. Employers spend more than $400 million per year on ‘union-avoidance’ consultants to bolster their union-busting efforts
Neoliberalism can be described as the attempt to expand the ideology, the policies, and the programs of neoclassical economics (free market fundamentalism) across all the dimensions, not only of the economy, but of the society as well. What it means is that we are no longer a country with a market economy but a market society. In this world wealth is made far more from finance than from productivity, and everything becomes a commodity. In turn, all of this is dressed up in the apparel of “a meritocracy,” an “alchemy” that turns class, racial, and gender injustice into a result of “individual merit.”
Look at what Neoliberalism has done to hollow out rural America. According to the Farm Bureau, from the 1960s to the 1980s roughly a third of each dollar an American consumer spent on groceries went to the farmers. By 2016 this figure was less than $.13. Further, more than half of farm households today lose money from farming. They work other jobs to subsidize their farming. Rural America is characterized by one rancher-businessman as a “tape worm economy,” which sucks up wealth and life like a vacuum cleaner from farming communities under “intense Wall Street/investor pressure.”
Or think about the relationship between productivity and wages. Research by Josh Bivens and Lawrence Michelle for the Economic Policy Institute found that from 1943 until the mid 70s productivity rose more than 103%, as did wages. Since that time, however, net productivity rose 72.2% between 1973 and 2014 while the “inflation adjusted hourly compensation of the median worker rose just 8.7% or 0.20% annually.”
I must also mention the enormous growth in inequality in wealth over the past four decades. The share of wealth held by the top 1 percent rose from 30 percent in 1989 to 39 percent in 2016, while the share held by the bottom 90 percent fell from 33 percent to 23 percent. Small recent increases in share by the bottom 90%, hardly touch the inequities of the past thirty to forty years.
One must not miss the impact of neoliberalism on democracy. Political scientists Martin Gilens and Benjamin Page studied the outcomes of a total of 1779 policy issues before this country. They found that the preferences of the average American had “a minuscule, near zero, statistically non-significant impact upon public policy.” Further, their research revealed a negative relationship between the alignment of “the most influential, business oriented groups” and the wishes of the average citizen: the wants of economic elites have far more singular influence on policy change then do the preferences of average citizens.
Finally consider the percent of wage and salary workers who were members of unions, which was 10.1 percent in 2022, down from 10.3 percent in 2021 (U.S. Bureau of Labor Statistics). However, the union membership rate of public-sector workers (33.1 percent) continued to be more than five times higher than the rate of private-sector workers (6.0 percent). Without strong labor organizing, we have no adequate organization of power to counter the economic outrages of our time.
J. Bradford DeLong provides an account of the failure of neoliberalism in his Slouching towards Utopia (2022), an economic history of the 20th century. His book took me back to Karl Polanyi’s The Great Transformation (1944) where Polanyi makes the case for a strong labor movement and an engaged civic sector to counter the captivities of a market society, and to challenge the rule of the rich we now face in our government. As part of civic society, our congregations have a towering call in our time to join labor and to engage in down on the ground organizing to retake a government of the people, by the people, and for the people.