When People Were Proud to Call Themselves ‘Neoliberal’

Tracking the evolution of one political label to understand why others come and go

Former President Ronald Reagan and former British Prime Minister Margaret Thatcher at the White House in 1982
Former President Ronald Reagan and former British Prime Minister Margaret Thatcher at the White House in 1982 (Gerald Penny / AP)

There are words that in quiet moments one might feel one does not quite grasp the meaning of, despite encountering them on a regular basis and perhaps even using them. I’ve heard some include epistemology in this category; I would add dating, for its magnificent ambiguity.

Another, for many, is neoliberal. Today the word is generally used as a critique from the left to refer to capitalism run amok. Recently, the essayist George Scialabba described neoliberalism as “the extension of market dominance to all spheres of social life, fostered and enforced by the state,” a rather nefarious-sounding proposition, including “investor rights agreements masquerading as ‘free trade’ and constraining the rights of governments to protect their own workers, environments, and currencies.”

It is hard to imagine anyone openly espousing such goals. Yet many once did embrace the neoliberal label, even including thinkers still considered to be eminently reasonable: The renowned mid-20th century politics writer Walter Lippmann was an outspoken proponent of neoliberalism. A typical statement from him on the subject was that neoliberalism “relies upon the development of the latent faculties of all men, shaped by their free transactions with one another.” This orientation seems conservative only in its Burkean value of institutions and wariness of top-down solutions—as in, the type of conservatism readily taught at universities and seen by liberals and centrists as the “smart” kind.

Lippman also wrote of the importance of “challenging the ruthless” with “an intuition of the human destiny which is invincible because it is self-evident.” How did the word neoliberalism go from referring to a progressive watchcry like this to being widely used as a slur?

Of course, words’ meanings change over time, more than a language’s speakers tend to be aware. Nice originally meant “unknowing”—in 1410, a Middle English source recounted (as translated into modern English), “They said he was a fool ... and that they never saw so nice a man”—and morphed into meaning “agreeable” via a series of quiet steps based on the fact that anything a word currently means harbors overtones of related, but different, meanings. An unknowing person is often timid, and thus nice came to mean timid. But, a timid person may be prissy, fastidious—and so nice had that meaning for a while. Then, it seeped into the usage that to be fastidious may be to be delicate or precise. This is why English retains an expression like a nice distinction, which obviously doesn’t refer to a distinction that makes you pancakes. But precision, as in carefulness, is a kind of agreeableness, and so what once meant “stupid” now means “kind.”

What has happened to neoliberal exemplifies this process as it occurs within a climate where ideological positions are mostly fixed but the labels that are affixed to them are subject to change. People can make up a new word, or use an old one in a new way, at any time. However, the things that these words describe often change more slowly, and lend a new word their overtones despite hopes that a new coinage could avoid or transform them.

To Lippmann and his peers, such as Friedrich Hayek and Ludwig von Mises, neoliberalism was meant as a new kind of liberalism that espoused, contrarily to what was expected of liberals, laissez-faire capitalism. The free market was thought to have conditioned the Great Depression, and came to be associated with the reviled assumption of Republicans such as President Herbert Hoover who had assumed that the economy would right itself. To these “new” liberals, the interventionist, state-directed policies of the New Deal instituted by Franklin Roosevelt had revealed themselves as equally unwise, and neoliberalism sought to strike a middle ground.

Lippmann and the other neoliberals disagreed as to just where that middle should be, but the general idea was that to be a neoliberal was to be on what intellectuals and social-justice activists would, or at least might, consider to be the proper side. The economist Milton Friedman took up the cause and became a respected celebrity, with a hit PBS series outlining his principles. Starting in the late 1970s, a cadre of writers at The New Republic, which Lippmann had helped to found, proudly bore the neoliberal label. They saw themselves as opposed to, rather than allied with, conservative organs such as the National Review.

However, the idea that neoliberalism was a variety of liberalism was always fragile, given that neoliberalism embraced the free-market principles that liberals were so wary of. In the early ’80s, Charles Peters, the editor of the Washington Monthly, helped usher in the new flavor of the word, as well as its reception from the left, with his aggressive “A Neo-Liberal’s Manifesto.” Those New Republic writers also brandished their self-appellation as neoliberals, in contrast to the mockingly termed paleoliberals. It furthered the sense of neoliberals as conservatives in sheep's clothing that they also opposed the basic liberal position on race issues—Bill Clinton’s welfare-reform policy, for example, was an outgrowth of neoliberal positions established in the 1980s, heartily espoused by, for example, The New Republic. Overtones, then, took effect—for liberals, “neoliberal” quickly took on the heartless, Hooverian odor that “conservative” already had.

This exemplifies a general process, whereby an old association hovering in the air settles down on a term designed to suppress it. Crippled was once a respectable term, but became so accreted with unsavory, dismissive assumptions that handicapped was brought in as a replacement. However, the same assumptions encrusted that word soon enough, as they also did with the replacement term disabled. Today’s substitutes such as differently abled will certainly suffer the same fate. Until the thoughts being described change, new words intended to teach new perspectives are like the sun on a hazy day, piercing through the clouds only for a spell. The very term that Clinton used, welfare, had once been called home relief more often by ordinary people, but that rapidly became a term of near-abuse. Since the 1990s, cash assistance has become the term of art, in alternation in policy circles with the almost deliberately faceless TANF (pronounced “tannif”), the acronym for Temporary Aid for Needy Families.

Since the Great Recession put the free market in an especially bad light, the new sense of neoliberal as a stain has settled in for good. Those familiar with the term through the writings of Lippmann, Hayek, or Friedman, once treated as “respectable” by many liberals, might now be confused by tart descriptions of neoliberalism such as the immigration activists Elizabeth Martinez and Arnoldo Garcia’s flinty, contemptuous checklist of neoliberal principles, which includes “the rule of the market,” “cutting expenditures for social services,” “deregulation,” “privatization, and “eliminating the concept of ‘the public good’ or ‘community.’”

Despite the liberal component of the word neoliberal, few would recognize much of it that is associated conventionally with liberalism, such that the economist and columnist Oliver Hartwich recently designated neoliberalism a “political swearword.” Today, neoliberal is used to refer to someone who bills themselves as a liberal but promotes ideas that actually inhibit individuals’ well-being. In the 1930s, the neo- in neoliberal meant “new.” But with this new meaning, the neo- prefix takes on a more specific connotation: “fake.”

This specific reconception of neo- is hardly universal; the prefix can still mean, indeed, just novel. Neorealism in Italian cinema was never tarred as having an ulterior commitment to looking backwards. The trajectory of the neoliberal label from the innovative and high-minded associations it once had to the sinister and anti-humanist ones it has now is a sociopolitical peculiarity, assisted by an analogous evolution of the term neoconservative.

The word was originally an insult, used by some liberals to refer to peers of theirs who had defected to the right. But conservative thinkers such as Norman Podhoretz and Irving Kristol aggressively reclaimed the term, and in the late 20th century, neoconservativism was intended to refer to thinkers who differentiated themselves from then-traditional conservatives in rejecting international isolationism for active, sometimes forceful intervention in global affairs. For example, Jeane Kirkpatrick’s 1979 article “Dictatorships and Double Standards,” offering directives for foreign intervention founded on an assumption that such interventions were the duty of the U.S., was considered a signature statement of neoconservativism. The magazine of record for this movement became Commentary, and neoconservatives’ embrace of military interventionism in the name of spreading American values challenged the liberalism of the 1960s just as The New Republic writers’ economic prescriptions had.

The neoconservatives had first proclaimed to be people of the left, seeing themselves as an energetic improvement on the traditional conservatism of the period before them. They saw their views as new wisdom that people left of center ought to embrace. However, history paved a hard road for their case. In the early 2000s, the neoconservative school supported George W. Bush’s war in Iraq, and the outcome there has been one that all but defeats any attempts to depict the neocon view circa 2002 as a wise one.

Then, on top of this, the founding neoconservatives took issue with the standard leftist positions on race, just as the neoliberals did. This made it natural for standing associations to drag neoconservative, as well, into mud it had been designed to hover above. But these days, to many liberals, neoconservatives’ attempt to dissociate themselves from the mainstream right is a feint. The neo- part can now be used as a sort of warning label, intended to signal that these aren’t true conservatives at all.

Between neoconservative and neoliberal, then, the neo prefix means not “new” but “disingenuous.” The neocon cloaks right-wing barbarism to make it seem less threatening; the neoliberal poses as a liberal while actually being a right-winger. The “neo” prefix now also carries a whiff of racist, in that both neoliberals and neoconservatives dissent from the liberal consensus on race issues, with neither in line with the idea that  whites are stained by “privilege.” From “new” to a moralist sneer—this is how meanings evolve. The original ideological positions survive, and impose their meanings on the words created to move beyond them.

Liberals happened to have shaped the connotations of neo- in both of these cases, but the other end of the spectrum can similarly dictate meanings. Politically correct was, in the 1970s and early 1980s, a term cherished by the left as a politely smug term referring to a conglomeration of left-of-center views one just knew were the proper ones, despite oppositional stances from the Nixonian right. I recall the term used by liberals when I was in college in the 1980s, as a mildly ironic but handy way of implying that certain views were indisputably “right” while paying lip service to the idea that one must not demonize those with other political positions. However, the rightist antagonism to the left, like all charismatic thought patterns, hardly faded away. Rather, the connotations of a then-established term such as knee-jerk liberalism settled upon politically correct, such that the right reconfigured the term as implying a questionable and obnoxious leftist partisanism, jabbingly abbreviated as PC.

This animus was just as impactful as that against neoliberal and neoconservative would later be. Today most liberals reflexively disavow being something as flimsy as PC, just as the fan of Hillary Clinton today often bristles at her being tarred with the neoliberal label. But that latter rejection would have baffled Walter Lippmann, whose views were celebrated in best-selling books and even smart Broadway musical lyrics: In 1940’s Pal Joey, an unexpectedly literate stripper breezily proclaims that “Walter Lippmann wasn’t brilliant today”—with the implication, shared by legions in the era, that he usually was.

The evolution of neoliberal from fresh-faced brand to knee-jerk slur teaches that while the existence of a left and a right is close to a given, what will change is the terms used to label political positions. To the extent that any new term seeks to either straddle the gap between left and right (as neoliberal did) or sanction either position as truth incarnate (politically correct), usage of those terms will before long merely drift into the same old obstinate grooves, like a bowling ball on the way to the gutter. Only with a magnificent transmogrification of America’s sense of human possibility would this change. Short of that, spectators are left to simply marvel at the awesomely protean quality of human language, which will always include terms like neoliberal whose definition will change so much over time that it will be difficult to pinpoint what single concept they refer to at all.