The Strange Non-Death of Neoliberalism. Colin Crouch urges us to rethink the role of giant corporations in the state vs market analysis of neoliberalism

Neoliberalism has ruled the Western world and most of the globe since the 1970’s. It is based on a market-driven approach to monetary policy and it promotes control of the economy by the private sector, which is supposedly more efficient than the public sector. For many, the recent financial collapse provided a strong blow to neoliberal economic theories. Indeed, the collapse was seen as a failure of banks, champions of neoliberalism and driven by profit maximization.

In the immediate aftermath of the crisis, European and international heads of state advocated firmer policy towards the market. Yet most of those policies have dramatically affected the public sector instead –fGreece, Portugal and the UK are good examples– and instigated the need to cut back once and for all on the welfare state and public spending. Despite the crisis, the neoliberal incentive to sub-contract public service to private firms remains the norm.

According to Professor Crouch, here lies the core riddle that needs to be addressed: why the crisis is not going to lead to a change in the neoliberal model that drives the world. He acknowledges that this model will keep encountering crises because of the inherent instability of its financial dynamics, but it will continue to be reinstated because there is no counter hegemonic power. This is what he calls the strange non-death of neoliberalism.

Traditional interpretations of the present structure of global economy are centered on free markets and states. Crouch’s analysis differs in that it highlights the importance of a third player, giant corporations. These are companies large enough to dominate and shape their markets, and which can easily weaken competitive forces. Moreover, because  governments contract these firms to deliver public services, it gives them considerable power over public policy and allows them to pressurize politics. Meanwhile, because policies are still focused on the state/market debate, they fail to acknowledge the real spearhead of neoliberal ideology, i.e. giant corporations.

In this triangular relationship, corporations, which have not been elected to deal with public life and the governance of society, end up having a decisive influence upon it. People working in the private sector now play a role in advising on public policy and running organizations. However, neither the theory of the market nor the theory of democracy can explain this.

In this stimulating and approachable book, Professor Crouch provides an original and rigorous interpretation of neoliberalism by focusing on the triangle of market-state-giant corporations. Although he argues that neoliberalism will remain the hegemonic power for decades to come, he also explains what can be done to transform the structure of the global economy. For instance, he details the role civil society already plays in pressurizing firms, thus promoting corporate social responsibility and putting giant corporations under the spotlight of political debate. An essential and exciting read for any policy-maker, academic or global citizen interested in exploring new ways of understanding neoliberalism.

The Strange Non-Death of Neoliberalism, Colin Crouch, Polity, 18€

–T.N.