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What Is The Difference Between `New’ Liberalism And `Neo-‘liberalism, And Which

Term Paper Title: What Is The Difference Between `New’ Liberalism And `Neo-‘liberalism, And Which
Word Count: 1510
Page Count: 6.04 (250 words per page double spaced)

What is the difference between `New’ liberalism and `Neo-‘liberalism, and which is the more defensible form of liberalism?


Liberalism is an enormously influential western political theory that underpins modern democracy and more. It structures political systems, bureaucracies, notions of citizenship, and self, and is often (though not always) conjoint to capitalism. “Liberalism is usually called a protean political theory because its emphasis has changed over the centuries and in different places.” (Human Dictionary of Geography 1999)  


The liberal school of economics became famous in Europe when Adam Smith, an English economist, published a book in 1776 called The Wealth of Nations. He and others advocated the abolition of government intervention in economic matters. No restrictions on manufacturing, no barriers to commerce, no tariffs, he said; free trade was the best way for a nation's economy to develop. Such ideas were "liberal" in the sense of no controls. This application of individualism encouraged "free" enterprise," "free" competition -- which came to mean, free for the capitalists to make huge profits as they wished.


Economic liberalism prevailed in the ‘west’ through the 1800s and early 1900s. The belief that government should advance the common good became widely accepted. governments started to intervene significantly in the economy; this trend gathered momentum after World War I, and became dominant after the Great Depression of the 1930s. People like L.T. Hobhouse theorized why and how a government could intervene in the economy without the country becoming a socialist planned economy. They took the name of new liberals, to signify how they endorsed the evolving tradition of political liberalism, while rejecting the radical element from the classical liberal school of economic thought as well as the then-revolutionary elements from the socialist school.The great depression of the 1930’s also led an economist named John Maynard Keynes to a theory that challenged liberalism as the best policy for capitalists. He said, in essence, that full employment is necessary for capitalism to grow and it can be achieved only if governments and central banks intervene to increase employment. These ideas had much influence on President Roosevelt's New Deal -- which did improve life for many people.


New liberals believe that while individual freedom should be guaranteed, classical free-market liberalism had failed to protect the basic rights of citizens, and that responsible government is the solution to many social and societal problems. New liberals think of their stance as a pragmatic midway between socialism and classical liberalism.


But the capitalist crisis over the last 25 years, with its shrinking profit rates, inspired the corporate elite to revive economic liberalism. That's what makes it "neo" or new. Now, with the rapid globalization of the capitalist economy, we are seeing neo-liberalism on a global scale


As the dominant discourse would have it, the economic world is a pure and perfect order, implacably unrolling the logic of its predictable consequences, and prompt to repress all violations by the sanctions that it inflicts, either automatically or —more unusually — through the intermediary of its armed extensions, the International Monetary Fund (IMF) and the Organization for Economic Cooperation and Development (OECD) and the policies they impose: reducing labour costs, reducing public expenditures and making work more flexible. Is the dominant discourse right? What if, in reality, this economic order were no more than the implementation of a utopia - the utopia of neoliberalism


A general characteristic of neoliberalism is the desire to intensify and expand the market, by increasing the number, frequency, repeatability, and formalisation of transactions. The ultimate goal of neoliberalism is a world where every action of every person is a market transaction, conducted in competition with others and influencing every other transaction, with transactions occurring in an ...

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