If any nation has strong unions, democratic politics, excellent education and healthy and combative social movements, the local economic elite will see all of these as impediments to profit and private gain. Therefore, instead of paying taxes on wealth realized through the resources of that nation, they will do everything they can (legal or illegal) to find ways to move their wealth offshore. Over time this will tend to starve the nation and put it further and further in debt.
Instead of going after the elite class and forcing them to pay their fair share, neoliberal institutions like the International Monetary Fund and the World Bank will counsel austerity and issue bailout packages with very strict conditions attached--conditions which will enforce ordinary people to earn less money, pay higher taxes and weaken any social or economic protections. Eventually as the debt continues to rise there will be inflation, higher interest rates and inevitably economic and social collapse as unions are systematically eradicated, the democratic public sphere shrinks and the social safety net is gradually dismantled.
Social-democratic governments are then accused of economic mismanagement by an elite press corps. Right-wing, undemocratic or fascist forces begin to emerge promising to make the nation great again by weeding out socialists and other 'undesirables'. When they are politically empowered poverty rates skyrocket, children go hungry, and the wealth gap between the elite and everyone else rises exponentially.
Under neoliberal austerity the health and welfare of citizens and the environment diminishes to a point of complete economic and environmental collapse.
Contrary to much that has been written about it, neoliberalism is not merely an economic system. It is, at its core, a political movement and ideology which arose in the 1980’s. It was originally articulated through the pernicious ‘free-market’ philosophy of Friedrich Hayek, Milton Friedman and the Chicago school of economics and then reframed through neo-conservative think-tanks such as the American Enterprise Institute and the Project for the New American Century.
Over the course of the last 50 years the neoliberal political movement has been advanced by far-right ideologues like Bill Kristol, Robert Kagan, Elliott Abrams, Dick Cheney, Tom Flanagan, Ezra Levant, Frank Gaffney, John Bolton, Paul Wolfowitz, Steve Bannon, Stephen Harper, Donald Rumsfeld and Stephen Rosen. But it is also helped along by so-called liberals like Merkel, May, Macron and Trudeau.
This political movement did not just re-orient global financial relations, it promoted war for profit and resources, created global refugees, sanctioned regime change, encouraged selfishness as a virtue, normalized intolerance and violence toward people of colour and other less advantaged groups, impeded labour rights, undermined fundamental human rights such as equality and freedom from oppression and globalized a particular mode of financialized usury which has been aptly described as corporate casino capitalism.
It is not just that the gap between rich and poor has significantly widened, or that toxic, climate disruptive corporations have been entirely deregulated. It is also that progressive and emancipatory advances achieved after long struggle—whether these were social, economic, labour, gender or civil rights are, under neoliberalism, now being systematically rolled back.
There is a fundamental affinity between neoliberalism as a specific political economy, growing intolerance and the rise of fascist movements—a state of affairs aided and abetted not just by the Trump’s and Bolsonaro’s of the world but by political leaders in Russia, China, Japan, Israel and Saudi Arabia.
Whether the latter are aware of it or not, the end state of neoliberalism is not merely to tip the economic scales in favour of the few, reduce taxes on the rich, or turn citizens into mere consumers. Much more ominously its purpose is to destroy community, labour solidarity and any notion of an authentically human self that wishes to live in accordance with values not reducible to things, objects or commodities bought and sold through a fictional market.
In a very real sense the logic of neoliberalism comes to completion when the commons has been destroyed, when human beings are rendered superfluous, when oceans, fresh water, arable land, oxygen giving forests and animal life have been used up and when the earth itself has been reduced to a lifeless empty shell.
That is the continuing legacy of neoliberal capitalism.