NEOLIBERALISM OR DEMOCRATIC DEVELOPMENT?
NEOLIBERALISM OR DEMOCRATIC DEVELOPMENT?
หน้า2 In a widening sphere of vastly different societies economic growth has come to be guided by the same set of neoliberal policies. Neoliberalism is a broad structure of political beliefs founded on right wing, yet not conservative, ideas about political democracy, individual freedom and the creative potential of unfettered entrepreneurship. The economic analysis at the theoretical core of this belief system derives from a certain reading of the founding texts of classical and neoclassical liberal economics. These represent market processes as optimally efficient means of allocating resources to the most productive uses. The main restriction on the tendency for free capitalist economies to grow is thought to be market failure resulting from perverse governmental intervention. In neoliberal thought, governments may play a productive role in providing public goods, such as infrastructure. Fiscal policy may help stabilize overly-exuberant economies. But most governments in welfare state societies and developing countries alike are said by neoliberals to have gone too far in interfering with the free play of markets. Neoliberal economists like Milton Friedman began to be taken seriously during the series of economic crises in the 1970s. Neoliberal-type economic policies were imposed by the IMF and the US Treasury on a left-leaning Labour Government in Britain in the middle 1970s. Neoliberalism was eagerly adopted by the Reagan and Thatcher governments in the early 1980s. The World Bank began to shift towards neoliberal positions with the Berg report on development in sub-Saharan Africa. A series of World Bank reports published in the 1980s showed increasing adherence to neoliberal positions. By the late 1980s, a system of policy recommendations, dubbed the ‘Washington consensus’, dominated what had previously been a liberal or social democratic development discourse. The consensus showed a renewed faith in classical economics, while advocating ‘prudent macroeconomic policies, outward orientation, and free