NOTE: You can find a definition of neoliberalism on our debate “Has neoliberalism failed?”.

FOR Neoliberalism

AGAINST Neoliberalism

Free markets are more efficient than the government

Have you ever wondered why bureaucracies are so slow? Neoliberals believe this inefficiency is caused by the fact that the government runs these bureaucracies. Government employees have little interest in speeding up their work because they are not motivated by the possibility of earning (or losing) a profit. Some examples of Neoliberalism would be the privatisation of government-run services like transport, utility and mail services. These moves were promoted by the United States and the United Kingdom in the 1980s and became popular in most Western countries. The globalisation of Neoliberalism followed. Most economists agree that a well functioning market is good for consumers because competition produces efficient, cheap and innovative outcomes. If innovation and progress of the past century were encouraged by capitalism, Neoliberalism would encourage the running of all parts of society and government with a business mind-set.

A completely free market creates more problems than it solves

Some things cannot be self-regulated by a free market. In a purely neoliberal society, health insurance companies, for example, would be incentivised to exclude older people, those living with disabilities, or anyone they fear may end up costing more than they pay in. Neoliberalism in education would encourage schools to cut teachers’ salaries, equipment, and field trips. Neoliberalism in law enforcement or prisons would encourage more arrests and prison sentences. Outsourcing public spending to private actors who are always forced to cut costs to increase profit can result in catastrophic cuts to quality. Further, privatisations make it difficult to hold actors accountable if something goes wrong. An example of how badly these projects can turn out was the tragic 2018 collapse of the Genoa bridge in Italy which left 43 people dead. The company in charge of maintaining the bridge, Autostrade, had been privatised in 1999.

It is realistic

Human nature is to be selfish. While it would be nice for all of humanity to share the Earth’s wealth and resources equally, it is simply unrealistic to expect humans to overcome their instinctual drive to look out for themselves and their families first. An attempt to create a different society would be naïve and doomed to fail. While it may not be perfect, neoliberalism has lead to an incredibly fast acceleration of wealth over the past 50 years

It distorts reality

Deciding everything based on profit may seem simple enough to design a societal ideology but looking out for nothing but the bottom line routinely creates catastrophic market failures. Perhaps the largest such failures is the environment. A company simply has no interest in limiting pollution, clean air, or clear rivers. Corporations do not calculate the cost of climate change. Instead, society as a whole has to bear it, while companies make a profit.

Neoliberalism rewards effort

Deregulation is central to neoliberal capitalism. It reduces bureaucracies and makes it easier for people to start or expand their business. Also, it favours low taxes, letting people who are successful within the economy reap the benefits of their success in the form of wealth. At the same time, it motivates people who are not yet successful to work hard and pull themselves up by their metaphorical bootstraps to strive for wealth and prosperity. This is the true meaning of neoliberalism. All it takes is the right idea, a business mindset and the next billionaire may be you. Elon Musk, for example, worked his way through college, took out student loans and became the richest man on earth in 2021.

The self-made billionaire is a myth

Stories from rags to riches are wildly inaccurate. Most wealth is inherited and not earned. Jeff Bezos, who at the beginning of 2021 lost the title of richest man on earth to Elon Musk, had also started a company by himself. However, he received significant financial help from his family in the early days of his business. The same is true for most successful entrepreneurs. A story such as that of Elon Musk is the rare exception. In fact, the chances of becoming a billionaire are about 1 to 90 000. And even then, to amass this kind of wealth it is inevitable to follow the model of Elon Musk and Jeff Bezos and exploit your workforce, keeping salaries low to increase profits.

IMAGE CREDITS: Flickr (CC BY-2.0) – R Barraez D´Lucca