The acme of neoliberalism

The acme of neoliberalism, Neoliberalism, India, coronavirus crisis

(Representational Image: iStock)

Neoliberalism drives policy in much of the world, including India. Amidst the coronavirus crisis, some of the policies associated with neoliberalism have begun to show their harmful impact on those who are poor and most vulnerable to economic shocks.

Neoliberalism has its origin in the libertarian ideology that cherishes minimal interference in choices made by individuals, allowing them maximum freedom in economic, social, cultural, and personal realms of life. Neoliberalism picks up the belief that there should be minimal or no interference in the functioning of markets.

It glorifies the ‘invisible hand’ by which the market will cater to the needs of people, with prices acting as signals of scarcity or plenty. It regards individuals as being capable of controlling their own destiny, irrespective of their actual circumstances. Rich or poor, outcast or privileged, everyone is expected to be responsible for their lot in life. If someone is poor, it is that person’s fault. Equally, if someone is immensely wealthy, it must be because that person deserved to be wealthy.


Whatever misfortune each person faces, it is the responsibility of that individual to overcome it. The government should not interfere. Neoliberalists believe that poverty is a natural condition produced by an economic system that allows the market full play and brooks no interference in its operations. Neoliberalism insists upon markets being kept free from government interference in the form of taxation, regulation, public spending or public ownership.

At most, the government should enable private industries to flourish. At face value, there is no issue in wanting private industries to flourish. But flaws in the libertarian mindset begin to show in practice and appear exaggerated in times of crisis. Neoliberalism has indeed allowed private industries and capitalists to grow at an unprecedented rate. Wealth has indeed been generated, but the wealth falls into the pockets of those already wealthy.

The wealthy are hardly affected by the Covid- 19 pandemic. They can afford better healthcare, security, live in spacious homes, and can be fast-tracked to access tests and treatments. In fact, some prominent people, including Jeff Bezos, the founder of Amazon, may come out of this richer. Bezos is expected to become the first trillionaire to walk the planet. Surely that’s all right. What’s the problem with having more rich men roaming the planet?

The first point that has to be made glaringly clear is that under a neoliberal system, only the rich will get richer. The poor get exploited for the benefit of the rich. In the absence of a strong public safety net, people become desperate for health services and the means to make ends meet. They often have no choice but to look toward private firms whose aim is to maximise profit. The operating principle is profits first, people second.

This is the cold-hearted reality of neoliberalism. In regimes that have subscribed to this ideology, for the sake of continual economic growth, the survival of people depends on their ability to pay for goods and services in the marketplace. In the neoliberal economy, corporations have no social responsibility and no compassion. Ideally, exploitation of those less privileged should not happen. But in the real world, this is a common occurrence. Neoliberalism in practice facilitates the exploitation of people in the pursuit of profits. Covid-19 is not the only thing people need to worry about.

The more immediate threat to their lives and livelihoods is hunger and homelessness. In India, immediately after the lockdown commenced, migrant workers were forced out of jobs; they had no financial support from the industrialists who employed them. Back in their homes, miles away from where they once earned a living, they face starvation, unemployment, even ostracism as potential carriers of the coronavirus.

Yet, in the face of this humanitarian tragedy, many states in India have decided to take advantage of their new emergency powers to cope with the pandemic to actually suspend laws enacted over decades to afford minimal protection to workers. Destroying hard-won rights of workers in the name of reviving economic activity, and enabling firms and corporations to exploit their workers, represents the acme of neoliberalism.

(The writer is a student of United World College, Pune)