Newsletter #103: The Fascists and the Neoliberals

This week we have a special edition of our occasional newsletter, authored by Daniel Coleman, a post-doctoral researcher at Harvard University, where he is completing a book project The Unseen: Neoliberalism & the Problem of Poverty. Here, he provides a thoughtful review of Quinn Slobodian’s latest book Hayek’s Bastards, which we featured in a recent episode of the Dig.  

Quinn has been a frequent guest on our show and a good friend of our project – appearing 4 times in the last couple of years. To the degree that our program is producing a new, if tentative, cognitive map of our conjuncture, Quinn’s work and analysis is indispensable. His latest book has been critical in helping us make sense of the ‘new fusion’ of forces on the contemporary right, which has stitched together tariff hawks, violent nativists, and free-marketeers into a governing coalition, if an uneasy one. Many have asked, does the return of protectionism and hardened borders signal a break with neoliberalism, or perhaps even a challenge to the dominant paradigms of capitalist rule? Quinn details movements internal to neoliberalism itself which have argued that white supremacist, nativist, and sovereigntist political priors are necessary precondition to the success of a market society or civilization. Trump, then, is not a backlash to the economic and social dislocations of the neoliberal counter-revolution; rather, both him and the MAGA movement are a politics internal to its ongoing development – and whose program looks to deepen, rather than challenge, the basic confirmation of state and market forces that have prevailed for the last nearly half-century.

In this thoughtful engagement with his book, Daniel Coleman raises some questions about how Quinn’s argument appears within his larger body of work, and asks how if the figures of ‘new fusionism’ he surfaces in his latest work are genuinely Hayek’s Bastards or more aptly supremacists that end up converging with the neoliberals for contingent strategic reasons, and therefore deserve distinct genealogies. 

What’s at stake in this argument? The question is how to read the current composition of the right, and the degree to which MAGA represents a new formula for right-wing politics or perhaps is a more unstable composite of projects that, under pressure, may unravel. Is there the makings of a hegemonic project here, or simply a ruinous effort at securing domination?

- Ben Mabie 

Neoliberalism & Volk Capitalism

The heart of Slobodian’s thesis is that “many contemporary iterations of the Far Right emerged within neoliberalism, not in opposition to it,” and he makes a good case for this in specific contexts. He undoubtedly overstates this argument, however, in flattening the “backlash” thesis of populists revolting against neoliberals into a mere “family feud” between them. Slobodian’s “frontlash” is an important qualification of the backlash narrative, but it cannot function as a fully alternate account of contemporary politics on the right. Ideologies of nationalism and national conservatism have been far more influential here than bastardised Hayekianism. Slobodian’s focus on only those elements bearing direct links to the neoliberal network has also predictably irritated readers from the neoliberal right themselves like Christopher Snowden of the Institute of Economic Affairs, who recently cast the work as “a book about right-wing populism” in which “the most prominent right-wing populists barely feature.” Reviewers on the left like Ashok Kumar have alternatively criticized the work for giving too much weight to the world of ideas in the first place, when a better explanation for their contradictions is that neoliberalism has always been better understood as a project to protect particular capital interests through the deployment of whichever ideas form their most suitable justification. The merging of ideas on the far right with neoliberal impulses, in Kumar’s view, is merely a sign that certain coalitions of organized capital are losing control of the slippery political trends they helped initiate.

On the other hand, Slobodian has not been given his due by critics. As noted in this interview, Slobodian is not claiming a wholesale diagnosis of the nationalist right, alt-right, or Trumpism, nor drawing a direct line from these iterations back to Hayek or Mises. He is instead looking at one section of the “supply-side” of recent populism, rather than providing a universal diagnosis as to why these movements succeeded. Slobodian’s thesis also scratches a real itch. He is right that narratives casting the motley coalitions around Brexit, Trump, or Alternative für Deutschland as representing clear backlashes against neoliberalism are, if not wrong, grossly incomplete. Dye-in-the-wool neoliberals held a prominent role in the leadership for Brexit. It is fascinating to find in this book that so many figures usually cast as nationalists claimed inspiration from Hayek, and were members of Hayek Societies, or even of the Mont Pelerin Society itself. Peter Brimelow, Richard Lynn, and Charles Murray’s connections to the neoliberal network are also well-documented. As Slobodian underlines, the neoliberal project’s agnosticism on questions like immigration left ample room for different brands of hard border politics to flourish within it.

The involvement of Arthur Laffer in Trump’s tax cuts, and the desire within certain sections of the populist right to hyper-charge privatization, deregulation, and tax cuts are similarly undeniable. Slobodian’s thesis in this sense resembles Mark Blyth and Phil Mirowski’s arguments that the remedies for neoliberal crises have invariably involved more neoliberalism. While Mehrsa Baradaran and Wendy Brown have contended that neoliberalism laid fertile ground for right-wing populists by weakening democratic imaginaries, public institutions, and legal constraints on corporate power, Slobodian’s charting of the more direct links of personnel and ideology between the two is a genuinely original contribution. These links existed, and they have not been adequately explored before. Prior to Margaret Thatcher in the British context, the IEA’s first hope for a neoliberal Prime Minister was Enoch Powell, marginalized from the highest tier of politics for his racial views before later becoming the political hero of Nigel Farage. The second was Keith Joseph, whose prospects for the top job similarly tanked after he gave a controversial speech on eugenics. It is in one sense easy to see how those on the populist right more recently could take inspiration from a neoliberal project founded to save Western “civilization” in asserting a broader politics of anti-Islamic and anti-immigration sentiment. One is reminded in particular of Wilhelm Röpke’s statement that socialism formed the “new Islam” from the East in its project to vanquish Western civilization.

It is, of course, a key part of Slobodian’s argument that this is a story of entangled genealogies and strategic political horse-trading. It is also true that the neoliberal project evolved many times in the face of changing political enemies - from socialism in the 1930s, to the welfare state and developmental planning in the postwar decades, to environmentalism and affirmative action beyond. Even granting these qualifications, however, it is difficult to square Hayek’s Bastards with Slobodian’s previous work Globalists, in which neoliberals’ core motivation was the restraint of national sovereignty, tariffs, economic nationalism, and any disregard of their vision of a rule-based international order. There just seem to be too many opposing views in some of these figures who assert national sovereignty above all else to be considered even the “bastards” of Hayek, regardless of whether they invoked his name for self-justification on the Right. Steve Bannon’s brief citation of Hayek’s “road to serfdom” is a good example. Slobodian’s argument that Bannon’s desire to maximize “citizenship value” sounds “less like a rejection of neoliberalism than a deepening of its logic into the heart of collective identity” is baffling. Maximizing citizenship value in this sense was surely what the likes of Hayek and Mises were staking the neoliberal project against in the twentieth century, as Globalists itself masterfully demonstrated.

Slobodian now seems to be using “neoliberalism” in a far more fluid sense - as “a project of retooling the state to save capitalism” and a doctrine “not filled with solutions but with problems.” This seems to me to provide ammunition to historians like Dan Rodgers and Jennifer Burns who have argued that it is not a useful category of analysis after all. Extrapolating Slobodian’s own terminology, it might have been more useful to call these figures “Volk capitalists” who were influenced by certain elements of the Hayekian project - to solidify capitalism and to roll back interventions for social justice - rather than defining them first and foremost as Hayek’s bastards. Slobodian also sidelines the Chicago element of neoliberalism, just as he did (for good reasons) in Globalists. But it was nonetheless easy to imagine a Milton Friedman nodding along to most of the ideas documented in that book. He would have seen little-to-nothing of value in any of the principles outlined in Hayek’s Bastards by contrast - from gold to hard borders to nativism. Much of neoliberalism has nothing to do with the Chicago School, of course, but a lens so divorced from it as to be wholly unrecognisable, and even in direct opposition to it, undermines the utility of the broader definition of neoliberalism as a coherent intellectual project.

Slobodian’s explorations of the links between neoliberalism and the far right in sum provide a welcome qualification to the more simplistic narratives of populism overturning what Gary Gerstle has called “the neoliberal order.” As Slobodian himself notes, these traditions share common concerns in bolstering capitalism and opposing socialism, affirmative action, environmentalism, and social democracy. Both similarly defend inequality in different contexts as being natural, beneficial, or necessary, demonstrating the feasibility of their forming contingent political alliances and of individuals gravitating between them. But there nonetheless remain insurmountable reasons - both political and analytical - why a firmer general distinction than Slobodian allows should be maintained between these two intellectual-political strands. The centrality of free trade and the presence of open-borders libertarianism within the neoliberal tradition, as well as the rejection of globalism and internationalism by mainstream elements of the far right, provide only some of the more obvious reasons for this distinction. Let us now turn to some of the book’s more specific arguments about the neoliberal project itself.

The Rock of Biology

Slobodian casts the evolution of libertarian critiques on social policy by the 1990s as increasingly tending towards “science and the return of nature.” His case that neoliberals placed increasing emphasis on nature and science in the post-industrial information economy and amidst growing interests in neuroscience is convincing. To be sure, some of Slobodian’s implications as to why this occurred are debatable. It is not clear, for example, why libertarians would be motivated to stress IQ inequalities to beat off environmentalism as the “green” successor to “red” socialism, especially when arguments for equality were at a low ebb by this time compared to previous decades. But, more importantly, if there was a discernible turn towards nature and science in the 1990s - more could have been done to assess the deeper history of the neoliberal project’s relationship to heredity, genetics, and race to investigate whether the seeds were planted for the more extremist elements Slobodian documents in the later twentieth century. How much of this was new? How much was merely a maturation, a radicalization, or a change of emphasis?

Let me give one example from an earlier decade. In 1956, Hayek participated in a conference on individuality at Princeton alongside the MPS members Milton Friedman, Arthur Kemp, Felix Morley, and Helmut Schoeck, as well as the biochemist Roger Williams and the botanist and historian of science Conway Zirkle. Zirkle noted at the meeting that the study of genetics had been banned in the communist world precisely because “biology today has as much relevance to our social problems as it ever had.” Zirkle cast “each breeding group, nation, or race as possessing a gene pool or a genetic reservoir,” before stressing that “equalitarianism cannot be extended honestly to these unknown but variable combinations of genes.” He further floated the idea that “it is possible that our coeducational colleges, where highly selected males and females meet when young, are as important in their function of bringing together the parents of our future superior individuals as they are in educating the present crop.” The MPS member John Chamberlain later cited Zirkle’s contributions here to argue that communist butchery of the bourgeoisie had permanently lowered “the genetic endowment of the Chinese race.”

Roger Williams likewise highlighted genetics’ role in the immense diversity of human capacities at the conference, noting in tandem that “race problems flourish on lack of appreciation of individuality and of interracial differences.” As well as citing Williams’ book - Free and Unequal: The Biological Basis of Individual Liberty (1953) - to reject any justification of economic equality resting on equality of human capacities in his Constitution of Liberty (1960), Hayek noted that obvious “differences” existed between “national or racial minorities” which, like all human discrepancies, would undermine any such case for equalized outcomes. Excavating such episodes opens the possibility of an interesting counter-narrative to Slobodian’s thesis: that scientific theories of genetics and IQ formed inputs to Hayek’s theorization - even if they were certainly sidelined in his analysis - rather than forming bastardised outputs created by his interpreters in the late twentieth century.

The MPS member Helmut Schoeck also spoke at the conference, displaying a keen interest in the very same IQ problem of “neurocastes” Slobodian tracks in later decades. “Many a teenager’s ego,” Schoeck argued, “suffers a worse and more lasting blow on the day he finds he must wear spectacles than on the day he discovers his school is restricted to his range of IQ. Shall we, therefore, compel the entire population to wear spectacles, so that the deficient will not feel inferior?… The welfare state principle of ‘giving’ all citizens equal old-age pensions, irrespective of need, is based on exactly this motive… Our social scientists tend to postulate a strange and unprovable equality of human nature and human potentialities when it comes to basing social (welfare) policy on social science.” Schoeck went on to cite D. V. Glass on the dangers of British efforts to equalize educational opportunities in the postwar period, stressing that even the left-leaning New Statesman was now “forced to ask whether the desire to produce a society of equals will not ‘simply end in one which is just as rigidly stratified on an IQ basis as it was once by birth.’” Real and innate inequalities in IQ meant that any true equality of opportunity would condemn those who did not succeed to self-loathing and bitter envy towards high-achievers.

In his Constitution of Liberty once again, Hayek cited Schoeck’s mobilization of Glass’s arguments alongside Michael Young’s Rise of Meritocracy - a text which itself plays an important role in Slobodian’s thesis. Schoeck was second in influence only to Milton Friedman in his views on educational policy within the mid-century neoliberal network, and the implications of his views on IQ-variance, evolution, and natural capacities regarding racial classification were evident in his contributions in other contexts. At an MPS meeting in 1957, Schoeck linked the pursuit of economic and racial equality as twin capitulations to communist propaganda, particularly when Soviet diplomats were “the first to move out of an apartment house the moment the first Negro family moves in.” In another article Schoeck wrote for Alice Widener’s USA under the pseudonym “Atlanticus,” he defended the United Fruit Company’s actions in Guatemala as having “helped Guatemalan workers, figuratively speaking, to live off banana trees instead of in them.” This article was included in the Mont Pelerin Society’s files for their West Berlin meeting in 1956.

This is just one flashpoint amongst others Slobodian might have explored to root his thesis more firmly in what otherwise comes across as a series of tenuous intellectual influences from Hayek and other neoliberals onto later, more racially-focused theorists like Peter Brimelow and Charles Murray. Slobodian provides an interesting exposition of Hayek’s theories on cultural evolution before diving into the views of his “bastards,” who evidently departed from Hayek in their prioritization of racial classification with only passing references back to Hayek as somehow squaring the circle.

Indeed, even if one agrees with Slobodian’s thesis in full, one could probably go further than he does in making his case. Despite their being far from Murray Rothbard’s extremism, I don’t believe most neoliberals of the twentieth century would have had much problem with his statement that “biology stands like a rock in the face of egalitarian fantasies.” Most of them always believed in a hierarchy of capacities and civilizations among different cultures and ethnic groups, and the line between racial and cultural factors in their diagnoses were often blurred to the point of insignificance - from Henry Simons’ belief that liberalism’s promise “may well be limited to certain societies or cultures, if not to certain latitudes or climates” to Wilhelm Röpke’s citation of Friedrich Schiller that “it is really inexplicable that man’s creative forces should be active in only so small a part of the earth, while all those vast peoples simply do not count as far as human progress is concerned.”

Peter Bauer argued more straightforwardly that “differences in economic qualities and attitudes between races and individuals are pronounced and important.” Though Indians displayed “many valuable economic qualities, they are nevertheless generally less ingenious, energetic, resourceful and industrious than the Chinese.” Friedman once diagnosed the disparity in economic performance between Bengalis and Punjabis as reflecting their “human qualities,” while George Stigler argued something similar in relation to African Americans in his article “The Problem of the Negro.” It is easy to see how both culturally-inclined and racially-inclined interpreters of neoliberal precepts could drive the implications of these views in different directions. This is one of the reasons too, I think, that someone like Bauer could be respected by figures as widely variant in their political views as Amartya Sen and Peter Brimelow. Whether situating all these examples in their wider context would support Slobodian’s broader arguments is an open question, but their relative lacking has left reviewers wanting more explanation on the linkages between Hayek, Mises, and other mainstream neoliberal precepts to the more extreme forms of racially-motivated libertarianism and the alt-Right whose divisions, in Slobodian’s mind, reflect a “family feud.”

Hayek, Money, Strategy

Slobodian’s exploration of the split between hermeneutic Austrians and paleolibertarians is a fascinating one. But it is never really clarified what his “bastards” are taking from Hayek, and “Mises’s bastards” seemed a more fitting reading for many of them. The concept of a “new fusionism” is a similarly captivating one in mobilizing “the language of science to justify the extension of competitive dynamics ever deeper into social life.” But, even here, more could have been done to outline Hayek’s theories of evolution in the social and natural sciences. In particular, Hayek emphasized that evolutionary patterns of natural selection in social habits were already central to Scottish Enlightenment thinkers like Adam Smith and David Hume before their application in the natural sciences; only after this were such ideas reimported into social theory in the vulgarized form of social Darwinism. It was primarily for this reason that Hayek was irritated with those who called him a social Darwinist. I also had some reservations with Slobodian’s framing of Hayek as turning towards Western moral heritage in the 1980s, when as early as the 1940s he was championing an individualist civilization born in European antiquity and matured by Judaeo-Christian values. The Mont Pelerin Society he founded in 1947 similarly stressed its central aim to be the saving of Western civilization and the abolition of moral relativism, and Hayek would later note in his Constitution of Liberty that liberal civilization was a derived phenomenon for most peoples of the non-Western world.

Some secondary elements of the book’s framing are also debatable. One gets the impression neoliberals bemoaned the loss of Bretton Woods in this book - but it is important to stress that most of them despised this system, particularly the Friedmanite wing favoring floating exchange rates. But even the goldbugs within the neoliberal network saw it (rightly) as a faux gold standard that did not resemble its classical ancestor, bearing numerous dangers as well as relying on a system of capital controls. Moreover, Slobodian’s argument that Hayek’s strategy for influencing elites and second-hand dealers in ideas drove the neoliberal project until Rothbard’s inversion in the 1990s is also challengeable. Rothbard’s view that the “masses” did not tend socialist would have been accepted by many within the neoliberal network - most importantly and influentially by Milton Friedman. Friedman believed that British socialism, for example, had not been further extended in the postwar period due to ordinary citizens’ resistance to hubristic socialist planners. Indeed, Friedman’s public-facing career in popularizing neoliberal ideas was itself testimony to Hayek’s strategy having already been inverted, something explored by Angus Burgin in his book The Great Persuasion.

The neoliberals were always varied in their views on political strategy. While many MPS members resembled the likes of Erik Kuehnelt-Leddihn, an arch-elitist stressing the need to restrain those Jacob Burckhardt once called die Begierlichen Massen, others followed a more Friedmanite line. John Davenport, for example, argued that the ordinary citizen had never been their foe, and it was rather leftist academics and “Park Avenue Liberals” like the Rockefellers and the Ford Foundation who fueled paternalistic interventionism. Bernhard Pfister similarly argued that the common man had an intuitive sympathy with the market system, re-emphasizing to his fellow neoliberals their shared belief that socialism had been a creation of the intellectuals. Examples ranging from the Institute of Economic Affairs’ preoccupation with public opinion surveys in London to Friedman’s Free to Choose show that a populist streak of anti-elitist rhetoric and tactics within the neoliberal network preexisted Rothbard’s admittedly unique and radicalized spin-off strategy of paleo-populism.

I offer these critical comments on the background of having gained an enormous amount from Slobodian’s book. Whatever your political persuasion, Hayek’s Bastards is an immensely generative work that is well-worth reading. Slobodian is a beautiful writer and a profound thinker, even in those places one might disagree with him. I encourage everyone to read Hayek’s Bastards and to listen to Daniel Denvir’s superb interview with its author in turn.