For any way of thought to become dominant, a conceptual apparatus has to be advanced that appeals to our intuitions and instincts, to our values and our desires, as well as to the possibilities inherent in the social world we inhabit. If successful, this conceptual apparatus becomes so embedded in common sense as to be taken for granted and not open to question. The founding figures of neoliberal thought took political ideals of human dignity and individual freedom as fundamental, as a "central values of civilization''. In so doing they chose wisely, for these are indeed compelling and seductive ideals. These values, they held, were threatened not only by fascism, dictatorships, and communism, but by all forms of state intervention that substituted collective judgments for those of individuals to choose. David Harvey--A Brief History of Neoliberalism, p. 5
The United States from its origins is a liberal society. A liberal society is one characterized by free markets with minimal state interference, a celebration of individual freedom and private property rights, and a democratically legitimated government that protects basic rights like freedom of speech and religion. In the Anglo-American world classic dominant political economic paradigm, but from it developed in the U.S. what might be called reform liberalism or progressive liberalism in the late 19th and early 20th century. Progressive liberalism, while embracing the basic values framework of classic liberalism, emerged as it became clear that classic liberalism led to the immiseration of the workers who labored within the large new industrial complexes that developed after the Civil War in the U.S. Classic liberalism created wealth, but it didn't distribute it well or fairly.
Progressive liberalism sought to use the power of governments to restrain the more predatory practices of emerging large corporations and to mitigate the disruptive social and economic effects caused by a rapidly developing and innovative capitalist market economy. Progressive liberalism in the U.S. is similar in many respects to social emocracy in Europe in that both seek an economic middle road between markets and government controls, but both derive from different post-Enlightenment intellectual traditions. Progressive liberalism is an attempt to moderate the extremes of bare-knuckled laissez-faire capitalism; European social democracy comes out of the other branch of Enlightenment political economic thinking--revolutionary socialism, and sought to mitigate its violently disruptive agenda of bare-knuckled revolutionary socialism.
I think American progressive liberalism's roots in the classic liberal tradition make it peculiarly allergic to the more dirigiste forms of European social democracy. Calling Obama, or anybody with any influence on the American national scene who doesn't come from Vermont, a socialist is facetious. Socialism has never had much broad seductive power in the U.S. Progressive liberalism is more experimental and adaptive, rather than ideologically driven. Keynes gave it a theoretical framework, but FDR came before Keynes.
In the US, laissez-faire liberalism dominated from the 1865 to 1932, and progressive liberalism dominated from 1933 to 1975. Laissez-faire Liberalism re-emerged during the shock decade of the 1970s during the Carter administration, was aggressively implemented during the Reagan administration, settled in during the Clinton administration, and It should have self-destructed during the Bush administration, but it didn't. Many people, me included, thought that the shock of the aughts--the U.S. government's reckless war-making and fiscal policies coupled with the financial markets disaster of 2008 would have forced adjustments in the direction of progressive liberalism, but the Obama administration has largely embraced neoliberalism as its basic policy framework.
Our politics in the US might be described now as mainly a factional dispute between right and left neoliberals. Neoliberalism is classic liberalism in a postindustrial key. It's an open question now whether the dominance of progressive liberalism from the thirties through the seventies was aberrational, and we've now returned to the historical norm. From where we stand now, it would appear so. But the ascendancy of neoliberalism doesn't explain what's going on in Washington now, and why the government is paralyzed and it's impossible to even get sensible gun control legislation enacted that 90% of the American population supports. Why isn't there more consensus in both parties if both are more or less agreed about neoliberal objectives?
I'd argue that the Democrats are, relatively speaking, serious neoliberals, while the Republicans are not. Democrats are serious about governing in accordance with Neoliberal principles.That means they embrace liberal social values while also embracing fiscally conservative agenda that seeks free trade, lower taxes and privatization of public institutions, cuts to entitlements, deregulation, weakening of collective bargaining rights, and a fetish regarding balanced budgets and reducing deficits.
The Republicans, on the other hand, are not serious at all about governance; they seek to use government power as a crony system primarily to protect and promote the interests of the very wealthy. Both parties are cronyist, but it's far more extreme and blatant in the Republican party. The Republican agenda overlaps with the Neoliberal agenda, but it departs from it when it conflicts with its strategies to maintain its political power or to wrest it from the Democrats who, though neoliberal in its essence still have to deal with progressive liberals in its caucus.The acquisition and exercise of political power is the most important objective for Republicans. It's a game many of them are playing as an end in itself without regard for what's good for the country as a whole. Governance is not something they care about, believe in, or do very effectively. Rather than shaming the GOP for their governance failures, the media accept it as evidence for the Republican contention that Government cannot govern effectively.
Both parties have bases, which party elites in each have to manage and appease from time to time, but neither base poses serious threats to elites in either party. Elites within the GOP have to deal with the cultural conservatives and religious right that compose their base, and elites within the Democratic party have to deal with a loose confederation of groups that are a mix of Progressive liberals on economic issues and cultural liberals who care more about identity politics than economic issues, and have little understanding of or care about the Neoliberal agenda.
This separation on cultural issues is exploited by economic elites to keep workers and the middle class divided in their separate cultural silos so they won't unite around economic issues. As a result, the cultural conservatives within the Republican Party are almost as powerless as the Progressive liberals are within the Democratic Party. Both factions get tossed crumbs, but neither is able to get its agenda taken seriously, except insofar as aspects of it overlap with the Neoliberal agenda. The culturally conservative GOP base gets opposition to sensible gun control as its crumb du jour; the progressive base gets support for abortion, gay marriage, as its crumbs du jour. I'm not saying some elites are insincere in their support or opposition to these cultural issues. I am saying that our preoccupation with them distracts us from dealing with deeper structural developments that have led to the emasculation of the progressive liberal economic agenda.
So while the Democratic Party power structure is dominated by neoliberals, it must embraces progressive liberals as part of its coalition as the GOP must embrace cultural conservatives. There are many neoliberals--Tom Friedman comes to mind--who are earnest utopians in their embrace of neoliberalism. And so an important place where earnest neoliberals true believers and their earnest counterparts in the Progressive faction differ is in a basic philosophical difference regarding globalization.
Neoliberals see it as something that lies outside of the power of national governments to control and so see the more realistic course as rolling with it rather than fighting it. They accept free market capitalism as on the whole a dynamic, if somewhat disruptive, positive force, and seek to mitigate its more disruptive effects by promoting improved education to prepare future workers for a dynamically changing work place and retraining programs for adults to mitigate the effects of structural, chronic worker displacement. The fundamental presuppositions of neoliberalism are social darwinist: adapt or die.
Progressive liberals accept that we are living in a rapidly integrating world system, but think that national governments can play a more proactive role in shaping national policy to benefit the interests of the broad public. This was essential goal of the Breton-Woods system==to find a Keynesian balance between desirable economic global integration and national sovereignty. Neoliberalism cares about the first but says there's little that can be done or should be done regarding the second. The neoliberals used the shocks of the seventies to discredit the Keynesian compromise, and have reverted us to the world system that existed before WWI. We're back in a kind of global economic wild west dominated by transnational economic warlords.
So we've seen this movie before. Yes, things are different now, but progressive liberals complain that neoliberal policies derive from political choices that benefit elite interests, and are not simply a necessary adjustment to the inevitable forces of globalization. But their critique has been unable to get any traction in the national corridors of power because while progressive liberal policy ideas resonate with a majority of Americans, they don't with elites in either party, and because wealthy elites are running things, nothing changes until that changes. And that's not going to change until progressive liberals come up with a counter narrative that is more broadly seductive than the neoliberal one. It must provide "a conceptual apparatus . . . that appeals to our intuitions and instincts, to our values and our desires, as well as to the possibilities inherent in the social world we inhabit." And organizes a people's movement around it.