Introduction: The Plot To Save The World

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Introduction: The Plot To Save The World

Back in 1938, a group of economists and philosophers met in Paris to consider how to save the world from itself.[iii] At the time, Mussolini, Hitler and Franco were turning their nations into fascist concentration camps while in Russia Stalin was killing millions of citizens he considered disloyal or unreliable, using everything from famine and gulags to firing squads.

After those three European democracies had gone full fascist, and Russia had bypassed democracy altogether to embrace a tyrannical form of communism, the Paris delegates were understandably worried about the future of democratic governance both in Europe and around the world. And the rise of communism and fascism had impacted every one of their lives personally.

The promise of fascism had been “law and order” while the promise of communism had been “no more hunger and want; all needs are met.” Neither had lived up to its promise. And in both cases, economics were at the core of the systems.

Fascist governments embraced their largest corporations so tightly that Mussolini had functionally replaced most of the Italian Parliament with representatives of his “fascist corporations.”[iv] The fascist theory was that when the business and government sectors operated in lockstep, they’d bring along the people with them.

The Soviet Union, on the other hand, rejected corporate control or even participation altogether, banning corporations outright. The government controlled every sector of the economy, the theory being that when government provided housing, education and jobs they’d bring the people along with them.

In both cases, though, the main outcome for “the people” was a loss of freedom and general misery.

How, these men who’d gathered in Paris wondered out loud, could modern democratic government be reinvented so it wouldn’t be so vulnerable to flipping either fascist or communist? How could a utopian society be created where everybody (or nearly everybody) had maximum freedom, maximum prosperity, and maximum control over their own lives?

And was it possible that economics could be the force that drove the process? Marx, after all, was an economist, as were Mussolini’s main advisors. Who better than economists to invent the world anew?

The idea the Paris group came up with was straightforward and comprised three main parts.

First, they believed that markets were both accurate and largely infallible: billions of tiny decisions were made in the marketplace of a country every day, as consumers and businesses chose which products to buy or sell and which vendors to buy them from or sell them to. There was no way any group of government bureaucrats could second-guess that sort of data/computing horsepower and, indeed, they believed the experience of the Soviet Union, which had shattered and then outlawed markets, proved them right.

So, they reasoned, markets should drive everything possible in a society for that society to work with maximum efficiency and the best possible outcomes. Literally everything. Market logic should drive business, of course, with profit being the determiner of winners and losers, but that same market logic should drive decisions in government and even within families.

Second, they believed that democracy was inherently dangerous and needed to be constrained. In a democracy, there was always the risk that the people would vote to disrupt the healthy, normal, near-magic economic order that would result from a “free market.”

The people might, essentially, vote to take wealth from the rich and give it to themselves; this would disrupt markets so badly it would render them senseless. Indeed, the Paris economists believed that was exactly what had happened with National Socialism or Nazism, which relied heavily on a free national single-payer healthcare system and free education for its support among the populace. Democracy had been too strong in those countries: it led them straight to fascism.

So instead of legislators sitting around and making their best guesses about how society should run, their main job instead should be to simply get out of the way so the magical marketplace could drive all the major decisions.

Democracy was fine when it came to deploying armies and police forces, or courts to adjudicate business disputes, but really needed to be blocked from interfering in moving around income or wealth in any way not dictated by the marketplace.

Market forces driving all political decisions would, they believed, even end war. If governments were converted from active agents of the will of their people into, instead, passive vessels for capitalism to do its magic, the countries of the world would be so busy trading with each other that they’d never want to destroy everything with warfare.

Third, these idealists had an answer for the inevitable question: If the government isn’t going to decide what’s legal and what’s not, what’s acceptable behavior in both the marketplace and the public square, then who should?

If democracy was to be so hobbled that it could no longer “interfere” in the normal and healthy functioning of a nation, what would replace it as the arbiter of “right and wrong”?

Their answer was straightforward. Humans, they believed, had developed – over thousands of years of trial-and-error – a natural “moral order” with its own set of rules. Everybody, for example, knows that its wrong to steal and wrong to kill.

So instead of regulating businesses so they or their executives couldn’t steal from or kill their customers or workers, let the free marketplace just single out, shame, and make examples of them when they do.

As thefts or deaths are exposed by a free press (part of a free market), companies committing those thefts or selling deadly products or running deadly workplaces would be abandoned by peers and customers and wither away. The moral order would be self-regulating, they said, so long as it wasn’t interfered with by government.

The evolutionary process that produced strong moral codes within society couldn’t be denied or resisted just because of passing moral fads.

If women were subordinate to men for a thousand years, then that must be what is right and good and should be celebrated. If racial segregation or shunning of homosexuality were the result of a thousand years of cultural evolution, those must be the standards by which a society was strongest and most resilient, even if it offended a few people. Their era’s misinterpretation of Darwin was right, even about ideas: only the strong survive.

These three principles came together neatly, these men believed.

· Instead of governments running the core life of a nation, markets would do so through their participants in the marketplace, nimbly responding to a million inputs a second.

· Instead of voters determining how wealth would be given, taken, or redistributed, the marketplace would make all those decisions in a way completely independent of (and often in defiance of) voters and legislators.

· And instead of legislators determining what the moral code of society would be, we’d look to the past to see what had always worked and carry that forward.

Much like Marx had done with communism and Mussolini had done with fascism, the Paris group wrapped their ideas for a new utopia together in a single package and gave it a name: neoliberalism.

This book is the story of these men and their new form of governance, which rocked the world in the 1970s and remade most advanced democracies by the beginning of the 21^st century.

And now neoliberalism, by giving outsized political power to the wealthiest among us and their industries ( particularly fossil fuels), threatens to plunge the planet into a disastrous hellscape if the monster they created isn’t tamed or caged.