A Political Economy of the Senses: Neoliberalism, Reification, Critique

IN THE wake of the 2008 economic crisis, the increasing precarity of economic life in the United States has become something of a national obsession. Watching former billionaires go for hysterical shopping sprees at Walmart, as in the documentary The Queen of Versailles, lambasting the annual fiscal cliff and expressing outrage over weekly revelations of the depths of Wall Street corruption are now national pastimes that reflect the growing salience of economics in the contemporary political imaginary. On the heels of President Obama’s ascent to the Oval Office with his message of hope, the political climate, and specifically the emphasis on economic issues in American politics, shifted dramatically.

Ironically enough, since he was elected largely on the strength of voters who were looking for change, Obama has been instrumental in shattering one of the central ideological buttresses of the liberal imaginary, perhaps precisely through his betrayal of the promises of social justice that had gotten him elected in the first place.1 In the aftermath of the 2008 financial crisis and subsequent bank bailout, the government was compelled to demolish even the appearance of separation between Wall Street and the government. That separation was a cornerstone of the liberal normative legitimating structures of contemporary neoliberal politics. Had the political elite not at that moment abandoned the ideology of separation between economics and politics central to the liberal imagination, neoliberalism may well have continued to wear its liberal sheepskin for a while longer.² The Occupy movement, which rode in on a potential that has arguably long been present, may not have manifested soon after in the fall of 2011 to cry foul. Far from ushering in a new era of “postneoliberalism,” as some would have it, the bailout simply made manifest the underlying logic of a neoliberalism that had been in place since the early 1970s.³ That logic entails perpetuating an appearance of separation between the economic and political spheres on the part of the political elite, while eroding that separation in practice. For a moment, postbailout, neoliberalism revealed, transparently, its political logic. The bailout and political responses to it illuminated the contours of the neoliberal relationship between economics and politics in the starkest terms. That relationship, as I will discuss in this chapter, is a fluctuating relationship characterized by a deep ambivalence toward economic issues on the part of the neoliberal state.

In this chapter I argue that an effective analysis of neoliberalism demands an understanding of the ambivalent relationship between the neoliberal state and the economic sphere in contemporary society and of the forms of depoliticization generated by this ambivalence. In subsequent chapters of the book, I will theorize these forms of depoliticization through the concept of reification from the critical theory tradition. While I save a systematic analysis of the concept of reification for subsequent chapters, in this chapter I draw attention to salient features of neoliberalism that complicate existing frameworks in political theory for understanding the nature of neoliberal domination and the contours of political resistance to those forms of domination. First, I argue that the neoliberal state takes an ambivalent role in relation to the economy, which shifts the boundary between economics and politics in neoliberal society in complicated and unstable ways. The ambivalent relationship the neoliberal state takes in relation to the economy results in a depoliticization of economics. This depoliticization takes at least two forms. First, the neoliberal state innovates policies that allow the state to govern the economy at a remove while avoiding responsibility for the distributional outcomes of those policies. Second, such policies produce the increasing inability of the state to direct the economy; thus the economy appears autonomous and immune to state policy and becomes increasingly prone to crisis.

The neoliberal transformation of the relationship between economics and politics, I argue, demands a synthesis of dominant theoretical frameworks for grasping neoliberal forms of depoliticization, namely Marxist critiques on the one hand and radical democratic critiques on the other. There has been a great deal of important work on issues of economics and politics that draws attention to features of political domination that emerge in neoliberalism.4 However, I highlight one particular aspect of neoliberalism that impacts the effectiveness of contemporary left critiques of neoliberalism in ways that have been underappreciated in the discipline of political theory. I argue that neoliberalism functions neither through a purely “political” form of domination nor through a purely “economic” one, but rather through shifting the very boundary between economics and politics, while simultaneously obscuring those shifts that it perpetuates.

Neoliberalism as a discourse and set of practices entails an inversion in the relationship between economics and politics inherent in classical liberalism.5 The neoliberal inversion of liberalism therefore resignifies dominant paradigms of political theory that base their understandings of contemporary society on a fundamental separation between the economic and political spheres. On the one hand, the neoliberal state increasingly retreats from social welfare functions in the context of low economic growth, in keeping with the neoliberal injunction to minimize state intervention in the economy. On the other hand, the neoliberal state purports to stand back from intervention in markets, while in practice playing a significant role in manipulating economic policy at a remove.⁶ However, the terms that many political theories of the left have used to grasp contemporary forms of depoliticization, I suggest, are inadequate for grasping the fundamental ambivalence of the state’s role in the economy and the political effects of this ambivalence. This problem, I suggest, stems from the formalism of significant strands of political theory. Radical democratic theory, I will show, has eschewed a nuanced critique of political economy in favor of a concept of politics that is conceived as autonomous from the economy.⁷ Yet if neoliberalism legitimates itself politically through a normative framework borrowed from classical liberalism, while eviscerating and transforming fundamental liberal norms such as liberty and equality in practice, radical democratic perspectives that assert the autonomy of the political from the economy actually neglect neoliberalism’s fundamental inversion of liberal normative frameworks and economic practices.

As such, the appeal of radical democratic critique to a separation between the economic and political spheres no longer has the emancipatory effects that it may once have had in an earlier phase of capitalist production. Appealing to the separation between economics and politics in the current political climate overlooks the extent to which economic logics now pervade the public sphere and generate profit through the economization of social life. By contrast, I suggest that contemporary Marxist theories emphasizing the political-economic dimensions of neoliberal domination may pay insufficient attention to the sensate, experiential, and perceptual dimensions of political action that social actors use to transform abstract economic logics into politically actionable form.

Therefore, I suggest that synthesizing the approaches of radical democratic theory and contemporary Marxism is crucial to developing a theoretical framework that effectively critiques neoliberal depoliticization and puts forth alternatives to neoliberal political forms. Such a synthesis forms the basis for what I will theorize in part 3 as “a political economy of the senses.” Synthesizing these approaches could move us beyond impasses in contemporary political theory that reproduce formalist and ahistorical concepts of politics and economy, which tend to reflect neoliberal symptoms at the theoretical level rather than subjecting neoliberal forms of domination to critique.

There is a now voluminous literature on neoliberalism and its political and economic effects on contemporary society. My objective here is to synthesize some of the main insights of this important scholarship in order to highlight a feature of neoliberalism that I take to be central to formulating an account from the perspective of political theory, in particular. This central feature is the state’s ambivalence toward the economy—which works in tandem with features of neoliberalization, including flexibilization, deregulation, and financialization—and distinguishes the neoliberal relationship between politics and economics from that of earlier phases of capitalism.

Recent scholarship has focused on three facets of neoliberalism. The first is that neoliberalism originated as a set of ideas put forth by a group of economic theorists in the 1930s and 1940s, including economists such as Alexander Rüstow, Walter Eucken, and Friedrich von Hayek.8 The term neoliberalism was first used in 1932 by Rüstow, one of the central thinkers of the German Ordoliberal school of economic thought.⁹ Rüstow’s slogan, “Free Economy, Strong State,” encapsulates with admiral brevity the paradox at the heart of neoliberal ideas.¹⁰ Whereas classical liberalism of the eighteenth century might be described by the motto “Free Economy, Minimal State,” Rüstow’s neoliberalism instead endorses a strong, interventionist state that creates the conditions for a “free economy.” This new conjunction of the state and economy theorized by the early neoliberals was one in which the state takes an active role in creating the conditions for free markets to flourish, both through specific kinds of economic policies, as well as through a particular kind of regulation of society and human behavior. The conjunction of a “strong” interventionist state with a “free economy,” distinguishes neoliberal thinking from classical liberalism.

Second, neoliberalism also refers (perhaps retroactively) to a set of policies adopted from the late 1970s by politicians such as Margaret Thatcher and Ronald Reagan who selectively put aspects of neoliberal theory into practice. The foundation of these neoliberal policies was the deregulation and liberalization of economic life. Corresponding to these two facets of economic policy was the imposition of two key values, as Lisa Duggan highlights: privatization and personal responsibility.11 Neoliberal politicians advocated the transfer of the costs of social reproduction, as well as the displacement of the costs of dependency to the realm of civil society and the family, through a language of personal responsibility and entrepreneurship. Thatcher and Reagan, for example, responded to dire unemployment and inflation by reducing the money supply and systematically eradicating the power of unions. They deregulated the economy in numerous areas, for example, the banking, airline, and communications industries, and they privatized and subcontracted public services.¹² Bill Clinton continued the neoliberal trend, illustrating that neoliberalism has no party affiliation, most notably through policies such as welfare reform, which made clear that the economic policies of neoliberalism went hand in hand with a cultural politics that was at its root both racially and sexually coded.¹³ Neoliberal policies varied considerably among various national models in response to the pressures of what Claus Offe has called the “disorganization” of capitalism.¹⁴ Yet, as Albena Azmanova emphasizes, although we cannot speak of a uniform neoliberal model, it is at least possible to identify the pressures of deregulation and liberalization that characterized the metamorphosis of welfare states into their neoliberal form across the board.¹⁵

Third, and relatedly, neoliberalism or, more accurately, neoliberalization also refers to a political-economic process whereby the boundary between economics and politics is transformed in ways that allow for greater intervention of the state in market processes while simultaneously obscuring that role.¹⁶ Neoliberalization entails the retreat of the state from social welfare functions even as the state takes a more interventionist role in market processes. Financialization has been a key dimension of such transformations, which in the account of economists such as John Bellamy Foster and Fred Magdoff, have arisen to counter the stagnation tendencies of capital even while exacerbating those tendencies.¹⁷ The consequence has been an immense proliferation of private and public sector debt, which has also escalated and created biopolitical and disciplinary forms of domination related to debt collection, especially for those individuals rendered most precarious by debt in the context of high unemployment.¹⁸ The predominance of financial capital in neoliberal society is one example of how economic dynamics are shifting the boundary between politics and economics. Financial capital requires political intervention to sustain its conditions, yet it increasingly becomes part of a process that is immune to political control, as the convulsive financial crises of recent years have demonstrated.¹⁹

Defining neoliberalism as a particular kind of political discourse and set of economic practices does not yet specify what constitutes a specifically neoliberal form of domination. Here I stress that neoliberal domination is at the most basic level, a form of depoliticization. I see this focus as complementary with, though importantly distinct, from approaches that stress the class character of neoliberal domination, such as work by Gerard Duménil and Dominique Lévy and David Harvey.20 Duménil and Lévy, for example, have argued that financial crisis has been a vehicle for the spread of neoliberal economic policies. The financial classes have responded to crises “according to a double standard, doing everything possible in order to preserve the revenue of the social group, even obtaining revenue through other means when it has declined in its traditional forms—whatever the consequences for other social groups and countries. Managing the crisis according to the interests of finance means being indifferent to unemployment, or even counting on its downward pressures on wage demands, on the level of social protection, on job guarantees—during the crisis and beyond.”²¹

While I agree with accounts such as these that neoliberalism has entailed a massive redistribution of wealth upward, and that neoliberalization has no doubt been a deliberate result of financial policies that benefited the financial/managerial capitalist classes, my conceptual focus is less on the dynamics of class relations and more on the ways in which the neoliberal configuration of the relationship between economics and politics tends to obscure the class dynamics of neoliberal economic policies. While class has long been, for good reason, a central category of progressive, and especially of Marxist, political theories, I argue that part of the insidiousness of neoliberalism as opposed to earlier phases of capitalism is the specific way in which class dynamics are being obscured and depoliticized, mainly through a reorganization of the relationship between the neoliberal state and the economy and through shifts in the relationship between the economic and political spheres more broadly.

As such, I focus on the underlying issues of depoliticization that are generated through the shifting relationship between economics and politics rather than on the category of class itself. Moreover, I resist a singular focus on class dynamics because issues of class can be, and have been, easily grasped under the sign of a critique of inequality—yet such a focus may miss the subtle subjective and structural implications of the ambivalence of the neoliberal state. A question that motivates my exploration in subsequent chapters is whether the primary focus upon class can hold the ambivalence that subjects experience in a society in which their economic welfare is intimately tied to their economic domination—in which, for example, I am knee-deep in debt to the very same institutions and corporations whose success is key to the flourishing of my retirement account. Can the conceptual priority of class grasp a conjuncture in which a radical left movement like Occupy Wall Street considered issuing its own debit card in a reluctant partnership with the infamous Visa corporation?22 Duménil and Lévy perceptively trace these forms of political ambivalence to be the outcome of specific policies on behalf of the financial classes, and I would certainly agree that they are.²³ But my work inquires into how political subjects can reckon with this ambivalence in theory and in practice now that it is a salient feature of the current political conjuncture.

Therefore, in my account, the class-based nature of neoliberal domination is a given, but it is not the central theoretical focus of my approach. Alternatively, I focus on the way in which neoliberalism depoliticizes key dimensions of social life by reconfiguring the boundary between economics and politics. Neoliberal forms of depoliticization are perpetuated by, first, an ambivalent stance of the neoliberal state toward the economy. That is to say, the neoliberal state pursues economic policies that are in some instances interventionist in relation to the economy and in other instances entail deregulation and a rollback of the state in relation to economic policy. At the same time, the political economic process of financialization creates conditions in which the economy is prone to crisis and therefore increasingly immune to regulation. These two dimensions of neoliberalization point to the ways in which neoliberalism depoliticizes the economy specifically by trading on the fluid boundary between economics and politics in neoliberal society.

I distinguish my approach to neoliberalism’s depoliticizing effects from what Jodi Dean has criticized under the name of the “post-politics” thesis.24 Dean argues that approaches that decry neoliberalism’s depoliticizing effects, such as work by Chantal Mouffe, Jacques Rancière, Slavoj Žižek, and Wendy Brown, among others, neglect the fact that “the economy appears as the site of politics, its most fundamental concern.”²⁵ But the question I would raise in response to Dean is, what exactly does one mean by “the economy” in this context? Dean argues that “jobs, deficits, surpluses, trade imbalances, consumer spending, subprime mortgages, bubbles, and budgets are key terms in the contemporary political lexicon,” and indeed I would agree.²⁶ My point in stressing depoliticization, however, is to ask whether we reach certain limits of political possibility when we limit questions of economics to the terms she mentions. It is true that these terms all indicate the prevalence of economic issues in the public sphere in the wake of the 2008 crisis, but it could be argued that the way these terms are deployed within public discourse tend to confine economics to the terms of the neoliberal relationship between state and economy. Along these lines, Athena Athanasiou has argued that the turn toward the economy in contemporary public and theoretical discourse actually may work in tandem with neoliberal logics rather than offer an effective critique of them. She writes, “The current moment might be portrayed as a new and reinvigorated incitation to economic discourse, which comes in various forms (very heterogeneous otherwise): either as postpolitical technocratic therapeutics and financial management, or as critical, anti-capitalist, and anti-neoliberal visions that take the economic realm to offer the only possible arena in which a comprehensive and rigorous political position against neoliberalism might be wrought.”²⁷

While I do hold that it is crucial for political theorists to turn their attention to theorizing the economy, I agree with Athanasiou that one should resist the tendency to reify the economy and thus to lapse into economic empiricism or, further, to take the prevalence of economic discourse in the public sphere itself to indicate a critical approach to neoliberalism. The question is not whether the economy is a site of political discussion: in the post-2008 context this is a given. The real question is whether public and theoretical discussions about the economy encourage citizens to see themselves not only through the frameworks of neoliberal subjection, as consumers, investors, and bearers of debt, but perhaps also as shapers of the economy.²⁸

The depoliticizing tendency of capitalism as a social and political system is nothing new, of course. Marx, as is well known, diagnosed depoliticization as the central problem of capitalism in texts such as the “Critique of Hegel’s Philosophy of Right,” “On the Jewish Question,” and the Economic and Philosophic Manuscripts, as I will discuss in chapter 3.²⁹ But in neoliberalism, as I will explore, depoliticization takes on a different form than it did in earlier phases of capitalism. The point of emphasizing depoliticization is not to invalidate the importance of current modes of economic politics, such as those that Dean describes, but to locate them as forms of politics that perhaps understand the economic only through the limited perspective of existing interpretations of the political under capitalism. For example, critiques of the U.S. government’s austerity measures, which demand that the state curtail its redistribution of wealth to corporations, are crucially important forms of politics. Such demands could be described in Marx’s terms, perhaps idiosyncratically, as a form of “political emancipation” from the economy. Yet, as Marx emphasized, critique can go beyond the idea of merely political emancipation to destabilize the distinction between economics and politics that sediments and anchors the limits of the contemporary political imagination—in his terms, critique can aspire toward human emancipation. In my account, both types of critical strategies are crucial.

To name neoliberalism as depoliticizing, then, is not to argue that we are somehow in a “postpolitical” condition in neoliberalism. Undoubtedly, forms of politics are alive and well in the contemporary moment. My goal, however, is to displace existing understandings of the political, in order to push beyond the limits that the neoliberal configuration of the economy-politics relation tends to impose. As Dean perceptively argues in her critique of communicative capitalism, we are confronted with a surplus, rather than a surfeit of so-called democratic communication, but the forms of communication we are bound to utilize in the hypertechnologized public sphere have little critical effect. Indeed, as Dean argues, these forms of communication “are exquisite media for capturing and reformatting political energies.”³⁰ Similarly, I would suggest, the moralizing outrage over corporatized capitalism that makes its daily appearance in the news media does little work to uncover the complex ideological dynamics that limit our understandings of what alternative kind of economic life our society ought to be working for.

In the 1980s and 1990s, neoliberalism in the Euro-Atlantic context was associated with a set of policies known as the Washington Consensus, which carried out policies of fiscal austerity, privatization, and pro-corporate policies through institutions such as the World Bank, IMF, and Federal Reserve.³² Prior to this period, the period between 1950–60 in the U.S. and Europe was characterized by economy-state relations governed by the paradigm of what some have called embedded liberalism, in which states actively involved themselves in industrial policy, set the social wage, built social welfare systems to provide education and health care, and intervened in the market to achieve full employment.³³ In embedded liberalism, market processes were circumscribed by a variety of social and political constraints and regulatory frameworks, and the state led the way in industrial and economic planning. The social contract reflected by embedded liberalism was one in which the state was recognized as responsible for intervening in market processes if necessary to achieve certain standards of social welfare.³⁴ Neoliberalism, by contrast, disembeds capital and the market from embedded liberalism’s constraints, arguably as a response to the stagnation of growth that took place in the 1960s. The result is a state that is straddled between past class compromises of the Keynesian era while serving as the agent of neoliberal policies of austerity, deregulation, and primitive accumulation.³⁵

More specifically, the first key shift that differentiates the welfare state from the neoliberal state is that from the state as primarily an agent of decommodification to the state as an agent of increased commodification, privatization, and deregulation. As Philip Cerny highlights, the essence of the postwar national welfare state consisted in its capacity to insulate fundamental aspects of economic life from the market while simultaneously promoting other aspects of the market.36 This meant not only promoting full employment and public health but also prioritizing specific industries to create economic growth, regulating business cycles, integrating labor movements into corporate processes, and effecting controls on the international movements of capital (258–59). The welfare state’s function was largely (though not solely) to be an agent of decommodification.

Yet in the context of neoliberalism, we witness the rise of what Cerny has called “the competition state.” By contrast to the welfare state, which pursued decommodification, the competition state “has pursued increased marketization in order to make economic activities located within the national territory, or which otherwise contribute to national wealth, more competitive in international and transnational terms” (259). This increased marketization took the form of the reduction of government spending in order to promote private investment, as well as the deregulation of economic, primarily financial, activities. The key point I want to highlight here is the way in which this shift from the welfare state to the neoliberal competition state affected the relationship between economics and politics. It is crucially important to see that deregulation does not actually remove the state’s influence on the economy, it simply changes the form in which the state impacts the economy and renders the relationship between the state and economy increasingly opaque. As Cerny argues, “Deregulation must not be seen just as the lifting of old regulations, but also as the formulation of new regulatory structures which are designed to cope with, and even to anticipate, shifts in competitive advantage. Furthermore, these new regulatory structures are often designed to enforce global market-rational economic and political behavior on rigid and inflexible private sector actors as well as on state actors and agencies” (264).

The neoliberal state is no less involved in pursuing economic projects than the welfare state was, yet the means by which it pursues influence over the economy is no longer based in the normativity of a welfare state acting in tandem with the public interest, it is rather based on seemingly nonnormative goals of deregulation and privatization that aim to release the market from the state in the context of low economic growth. In political terms, however, the neoliberal state’s strategy is based on the paradoxical need to, in Cerny’s words, get the state “to do both more and less at the same time” (263). Giandomenico Majone argues that neoliberal transformations in regulation have resulted in the redrawing of the borders of the state, and he highlights regulation as a distinctive form of state intervention. Regulation reflects the ambiguous and obscure relationship between economics and politics in the neoliberal context, as the privatization of previously state-directed industries tends, according to Majone, “to strengthen, rather than weaken, the regulatory capacity of the state.”37 As such, “neither privatization nor deregulation have meant a return to laissez-faire or an end to all regulation. Privatization changes the role of the state from a producer of goods and services to that of an umpire whose function is to ensure that economic actors play by the agreed rules of the game.”³⁸ Yet regulation does not reduce the role of the state in economic activity, it strengthens it, while allowing the state’s role in the economic realm to be indirect and obscure. This strategy reflects the neoliberal state’s ambivalence toward the economy, which I would argue obfuscates both the specific ways in which the neoliberal state impacts the economy as well as the normativity of the neoliberal state’s economic policies.

In addition to privatization and de- and reregulation, one of the key ways in which the neoliberal state reorganizes the boundary between economics and politics is by means of economic policies that obscure the state’s role in the regulation of markets. Greta Krippner’s work illuminates the ways in which neoliberal policies are characterized by the state’s ambivalent stance in relationship to economics, as well as how neoliberal economic policies beginning in the late 1970s not only removed certain kinds of economic policies from the realm of the political, but also obscured the depoliticizing dimensions of neoliberal economic policies. In Capitalizing on Crisis, a study of U.S. monetary policy and finance in the twentieth century, Krippner argues that the Federal Reserve’s increasing reliance on monetary policy to exert control over the economy in the late 1970s stemmed from the legitimation crisis confronted by the state in balancing the contradictory goals of guiding market outcomes and avoiding responsibility for the social imbalances associated with economic growth.39 The Fed circumvented this dilemma by turning to monetary policy as the means through which to manipulate the economy from afar. By presenting the implementation of monetary policy as apolitical and technical, even as interest rates were a crucial factor in shaping social distribution, the Fed thereby avoided responsibility for the distributional and social consequences of the economic policies it pursued.

Although monetary policy is decidedly a political matter, U.S. governmental policy in the 1970s sought to represent it as apolitical. Krippner writes that “the Federal Reserve has a strong incentive to obscure its role in determining economic outcomes, and it generally has done so by redefining economic events as the product of ‘market forces’ rather than the activities of state officials.”⁴⁰ Similarly, the Federal Reserve’s 1979 turn toward monetarist policy, according to Krippner, was an attempt by the Fed to present policy choices as having arisen automatically from market-generated fluctuations in the money supply. This example illustrates a key facet of the dynamic between the state and economy in neoliberalism. In neoliberalism the state presents certain economic policies as apolitical and as arising from the automatic dynamics of the market, when, in fact, they are a product of specific state policies.

The shifting boundary between economics and politics creates what Krippner calls “the neoliberal dilemma.” In the context of low economic growth in the period from 1970 to the present, Krippner argues, U.S. policymakers have looked for ways to avoid responsibility for economic outcomes, yet markets still require regulation to function.⁴¹ Such contradictory demands—on the one hand, to avoid economic responsibility and, on the other, to continue to regulate markets—give rise to institutional innovations that have allowed the state to achieve specific economic outcomes through indirect manipulation of the economy. Krippner’s research shows how, in practice, neoliberal politicians and elites pursue policies that obscure the state’s role in regulating markets, allowing them to govern the economy at a remove while avoiding political responsibility for economic policies and outcomes.

Krippner’s research indicates that neoliberal economic policies specifically and intentionally obfuscate their status as political. The obfuscation of the political dimensions of supposedly purely economic, technical policies on the part of institutions like the Federal Reserve exemplifies the shifting contents of the category of “the political” in light of neoliberalization. While neoliberal politicians may wish to portray state economic policy as purely technical, as opposed to political, in order to sustain fantasies of “free trade” and a noninterventionist state, they do so by reorganizing the boundary between economics and politics.42

Shifting the boundary between economics and politics and thereby depoliticizing economic policy is a central feature of what I will explore in part 2 under the sign of neoliberal reification. For now, suffice it to say that if the boundaries between economics and politics are indeed shifting in ways that shore up the state’s role in economic decision making, while simultaneously obscuring that role, then attention to the historically specific relationship between economics and politics as well as to the content of these categories is crucial to critiquing neoliberal domination.

A related feature of the neoliberal transformation in the relationship between politics and economics concerns the effects of the increasingly crisis-prone nature of the capitalist economy. Work by scholars such as Krippner, Harvey, Foster, and Magdoff emphasizes the ways in which political economic transformations in the structure of capitalism including the increasing predominance of finance capital, the rollback of the state’s role in maintaining social welfare and employment, and the stagnation of economic growth in the post-Fordist era have rendered the economy increasingly vulnerable to economic crises. Studying the political economic dimensions of neoliberalism illuminates another dimension of how neoliberalism depoliticizes the economy. On the one hand, as I emphasized earlier, the neoliberal state innovates economic policies that allow the state to regulate markets at a remove while obscuring its own role in fashioning economic outcomes. On the other hand, political economic approaches highlight the ways in which neoliberal economic policy increasingly erodes policymakers’ control of the economy. As Krippner writes of the case of the Federal Reserve’s economic policies in the late 1970s, “the Federal Reserve’s efforts to depoliticize its activities by turning to the market has placed control over the expansion of credit in the hands of a particularly lax master, creating conditions conducive to the financialization of the economy.”⁴³

Moreover, even as economics has increasingly become the focus of domestic politics in the United States and Europe in the aftermath of 2008, it is important to consider that in the context of economic crisis, low economic growth, and the austerity measures that have followed these economic developments, as Wolfgang Streeck and Daniel Mertens observe, the share of public finance that is available for discretionary spending has shrunk significantly. This points to a further shift in the relationship between economics and politics in the neoliberal context, as fiscal democracy is increasingly eroded by the decreasing responsiveness of the state to democratic interests in light of what Streeck and Mertens call “fiscal sclerosis.”44 This phenomenon points to the ways in which the economic context of neoliberal austerity directly impacts the form that democracy takes. Economic democracy is narrowed by the fiscal priorities of the postcrisis neoliberal state.

Finally, it is important to consider the role of corporations in the transformation of the relationship between economy and state in neoliberal society. As Colin Crouch underscores, corporations are not merely a powerful lobby within Euro-Atlantic governments, they are in fact major insider participants in government policy-making processes. Corporate lobbying, of course, is itself a tremendous source of influence within public life. For example, according to a 2010 report by the IMF, U.S. firms spent $4.2 billion on political activities during the previous four-year election cycle. But lobbying, however problematic, is at least a transparent form of influence.⁴⁵ Far more insidious are the opaque forms of corporate influence on the state that go beyond lobbying.

Crouch identifies four primary processes in which corporations now increasingly effect influence “inside the chamber”: 1. through transnational corporations; 2. through economic theories of competition that prioritize consumer “welfare” over consumer choice and thus ultimately result in the reduction of market competition; 3. through the ascendance of “new public management” systems, a branch of neoliberal policy theory that seeks to remedy supposed inefficiencies in government institutions by modeling them along the pattern of corporations; 4. through the increasing subcontracting of public services to private corporations.46 In line with new public management ideology, governments have increasingly hired private-sector consultants and appointed senior managers from private firms. A notorious example of this model occurred in the aftermath of the financial crisis of 2008 when many of the key individuals involved in the deregulation of the banking industry came directly from investment banks before working for the government.⁴⁷ As Crouch highlights, these processes of subcontracting and privatization of public services create a democratic deficit, “as the relationship between government and citizens is replaced by that between government and contractor, while the citizens’ only relation to the contractor is that of user—a more passive one than that of customer.”⁴⁸ The key for the purposes of my argument is also to see that the triangulation between citizens, government, and corporations, the latter of which are increasingly embedded within government institutions themselves, create an opaque relationship between economics and politics, one that is as such less amenable to democratic contestation or perception.

To underscore my point, neoliberal economic policies obscure the relationship between economics and politics in (at least) two ways: 1. the neoliberal state innovates policies that allow the state to govern the economy at a remove, while avoiding responsibility for economic outcomes; and 2. such policies simultaneously create political economic conditions that render the economy significantly less responsive to economic regulation and more vulnerable to economic crises.

Neoliberal discourse, I argue, entails an inversion of classical liberal discourses about the relationship between economics and politics. I look to Michel Foucault’s influential lectures on neoliberalism as a discursive formation to elaborate what is at stake in the neoliberal inversion of liberalism. My central point is that, in the face of the neoliberal inversion of liberalism, liberal assumptions nevertheless continue to inform the sociological assumptions underlying many political theories of the left. By neglecting the neoliberal inversion of liberalism in theory, and the evisceration of liberal norms in practice, influential political theories of the left are themselves symptomatic of the neoliberal reorganization of the relationship between politics and economics rather than critical of it.

According to Foucault, the German ordoliberals, a group of thinkers who were at the forefront of defining what we today take to be the principles of neoliberalism, effected several shifts and inversions in classical liberal doctrine to specify a new relationship between the state and economy. Foucault writes that “the problem of neo-liberalism was not how to cut out or contrive a free space of the market within an already given political society, as in the liberalism of Adam Smith and the eighteenth century. The problem of neo-liberalism is rather how the overall exercise of political power can be modeled on the principles of a market economy.”⁵² For the neoliberals, as opposed to eighteenth- and nineteenth-century liberals, the state’s function is no longer to merely carve out a space for the market to function unimpeded, but rather to actively constitute the market.

The crucial distinction here is between a liberalism in which the state leaves spaces for freedom of exchange that already exist in society versus a neoliberalism in which the state must construct spaces for competitive exchange in civil society. In classical liberalism “the most that was asked of the state was that it supervise the smooth running of the market, that is to say, that it ensure respect for the freedom of those involved in exchange. The State did not have to intervene in the market.”⁵³ The state’s role was to place its authority behind private property rather than to intervene in market functions. In the case of classical liberalism, the state stands back and allows an already existing, quasi-natural freedom of exchange to operate. Adam Smith’s definition of human nature—in terms of the propensity toward “truck, barter, and exchange”—illustrates the classic liberal approach to the state.⁵⁴

In the case of neoliberalism, by contrast, the state sees itself as actively producing the conditions for free markets. Markets are no longer conceived as part of the natural order. For the neoliberals, “pure competition must and can only be an objective, an objective thus presupposing an indefinitely active policy. Competition is therefore a historical objective of governmental art and not a natural given that must be respected.”55 As a consequence, Foucault observes, twentieth-century neoliberalism moves away from a model of the state and economy in which the two spheres are sharply delimited. For the ordoliberals, “the relation between an economy of competition and a state can no longer be one of the reciprocal delimitation of different domains. … Government must accompany the market economy from start to finish.”⁵⁶ Where liberalism is committed to the delimitation of two bounded domains of economics and politics, neoliberalism brings an active governmentality to the realm of the market, which in practice elides the boundaries between the spheres of the state and the economy.

Foucault’s study is primarily a study of neoliberal discourses of particular German and American neoliberal thinkers from the mid-twentieth century, and he analyzes the ideas of key neoliberal thinkers to show that at the discursive level these neoliberal thinkers did not support a laissez-faire state—that is, they were not committed to liberalism as such, but rather were reinventing liberalism as a doctrine that would intervene in the economy, albeit indirectly. Foucault writes, “In all the texts of the neo-liberals you find the theme that government is active, vigilant, and intervening in a liberal regime, a formulae that neither the classical liberalism of the nineteenth century nor the contemporary American anarcho-capitalism could accept.”⁵⁷ Foucault’s genealogy of neoliberalism shows precisely how neoliberal thinkers adapted the principles of liberalism into a neoliberal doctrine that models political power on the principles of a market economy.

Foucault’s lectures on neoliberalism, delivered from 1978–79, are extremely prescient in their analysis of the political rationality of neoliberalism decades before discussions about neoliberalism became widespread in scholarship. However, I would suggest that focusing on intellectual discourses of neoliberalism alone, as Foucault does, has limitations. While I take from Foucault the key observation that neoliberalism must be distinguished from classical liberalism in how it figures the relationship between economics and politics, the problem with Foucault’s discussion of the relationship of neoliberal ideas with the principle of laissez-faire is that the relationship between neoliberal theory and practice becomes unclear in his analysis. His work therefore may fail to appreciate the degree to which contemporary Euro-Atlantic capitalist democracies continue to be committed to liberal principles and conceptions of the good life as well as distinguish adequately between neoliberal theory and practice.58 While neoliberalism transforms the relationship between the state and economy at a discursive and practical level, it leaves intact fundamental liberal commitments to liberty and equality in form while transforming and evacuating their content.

Foucault makes clear that neoliberalism and liberalism are fundamentally different discursive forms with distinct political rationalities. However, in his desire to disarticulate these two doctrines, his work underplays the extent to which neoliberalism depends on liberal norms of legitimation in contemporary society. Although neoliberalism is a doctrine that evacuates the content of liberal norms through the economization of social and political life, this facet of neoliberalism is not necessarily visible in the key theoretical texts by neoliberal elites.

Yet there has been much scholarship detailing the affective and normative persistence of liberal values, even as the economic and social basis of those norms becomes progressively eroded. Gayatri Spivak pithily speaks to the problem of liberalism’s normative persistence by naming liberalism as “that which we cannot not want.”⁵⁹ As the cultural theorist Lauren Berlant argues in Cruel Optimism, citizens of postindustrial societies remain affectively attached to unachievable fantasies of the good life promised by liberal capitalism, such as job security, social and political equality, and social mobility, even as liberal capitalist societies have proven unable to deliver on these promises and even as neoliberalization has generated a structural situation in which these fantasies sustain attachment to a political order that systematically undermines the possibility of fulfilling them.⁶⁰ Berlant’s work indicates that contemporary neoliberalism depends at an ideological level upon citizens’ attachments to mapping out the sociopolitical field in terms that are derived from liberal frameworks of politics.

Although, as Foucault demonstrates, neoliberalism entails an inversion in the relationship between the state and economy, whereby the state takes an interventionist role in constructing the conditions for free markets, the classic liberal distinction between a compartmentalized state and economy nevertheless continues to provide an implicit framework for significant strands of contemporary political critique. Unless we understand the ways in which neoliberalism violates its own commitments to liberal or liberalesque principles, and transforms the content of these very principles, the structure of neoliberal depoliticization remains unclear. In particular, a heavy focus on early discourses of neoliberalism from the mid twentieth century, which has been a significant tendency in the political theory literature on neoliberalism, may miss the ways in which neoliberalism transforms the content of liberal principles while retaining those principles in form.61

As I have argued, neoliberalism as a discourse inverts classical liberal understandings of the relationship between the state and economy. The key consequence of this inversion is that the neoliberal restructuring of the relationship between economics and politics has resignified liberal forms of critique. In other words, liberal forms of critique have very different political effects under neoliberal conditions than they did under liberal ones. Moreover, the resignification of liberal critical concepts has also repositioned other critical discourses, even those that are explicitly critical of liberal political ideas.

To comprehend the resignification of critical discourse in neoliberal context, I make use of Nancy Fraser’s and Luc Boltanski and Eve Chiapello’s analyses of the neoliberal resignification of critique. The key point I take from Fraser and Boltanski and Chiapello is the fundamental importance of the historicity of forms of critique and the complex dynamics that can render discourses that were critical in one period a source of legitimation for capitalist domination in the midst of subtle transformations of the dynamics of capital in another period.

Fraser shows how critical discourses can unconsciously morph into discourses that legitimate a new economic order of domination. In “Feminism, Capitalism, and the Cunning of History” Fraser argues that cultural changes sparked by second-wave feminism have unintentionally served to legitimate structural transformations in neoliberal capitalism.62 According to Fraser, second-wave feminism issued a systemic critique of state-organized capitalism, challenging its androcentrism, economism, and its state centrism. Yet the feminist movement coincided with transformations in the nature of capitalism that, according to Fraser, resignified feminist critique. For example, neoliberal capitalism (in contrast to the state capitalism second-wave feminists were criticizing) was characterized by privatization and deregulation, which recast second-wave feminisms’ critique of state centrism. Similarly, the second-wave feminist critique of economism coincided with the neoliberal state’s displacement of social justice from the terrain of economic equality to that of cultural recognition. The effect, according to Fraser, was to resignify feminist ideals and to render feminist critique a source of legitimation for neoliberalism. Fraser writes, “Disturbing as it may sound, I am suggesting that second-wave feminism has unwittingly provided a key ingredient of the new spirit of neoliberalism.”⁶³ In the context of neoliberalism, key aspects of the second-wave feminist critique no longer retained their critical force under new historical conditions.

Boltanski and Chiapello illuminate this process of the resignification of critique as key to the creation of what they call the “new spirit of capitalism.”⁶⁴ They trace the development of a new ethos of capitalism in the 1980s and 1990s, based on an ethic of the neoliberal worker as a creative, cooperative, and flexible subject, in contrast to the hierarchical and obedient worker-subject of Taylorist and Fordist capitalism. The new spirit of capitalism, they argue, was created by management theorists’ co-optation of the romantic, artistic critique of capitalism that emerged from May ’68, and the separation of the romantic critique of capital from its basis in a systemic critique of capital. Management theorists in the 1990s, according to Chiapello and Boltanski, crafted their new approach to organizing individuals in the workplace precisely as a response to the ’68 romantic critique of capitalism. What I find crucial in Boltanski and Chiapello’s account is their analysis of the role of critique in legitimating and constraining the capitalist accumulation process.⁶⁵ They write, “The spirit of capitalism … plays a key role in the capitalist process, which it serves by restraining that process.”⁶⁶ Of course, as Boltanski and Chiapello acknowledge, critique restrains the accumulation process only under certain historical conditions. Less optimistically, the capitalist accumulation process may also obfuscate and dismantle the operations of critique. They claim that the dynamic of capital may

Berlant describes an impasse as “a space of time lived without a narrative genre.”⁶⁸ While her focus is on the affective inhabitation of an impasse, and the gestures that emerge to make sense of a transitional space of time in which action has no orientation and in which precarity predominates, I suggest that the concept of the impasse is useful for understanding the situation of the left critique of neoliberalism in light of the neoliberal resignification of critique. In the context of an impasse, Berlant argues, conceptual markers of orientation have been displaced, either due to traumatic or catastrophic events or due to more quotidian modes of being adrift. Yet an impasse can also give rise to a situation “where managing the presence of a problem/event … dissolves the old sureties and forces improvisation and reflection on life-without-guarantees.”⁶⁹ In the Euro-Atlantic context the economic events of the late 2000s have provoked just such a dissolution of the landscape of critique, an issue I will discuss further in chapter 7 in my discussion of Occupy Wall Street’s refiguration of the critique of neoliberalism.

Yet in contrast to Berlant, who proposes what she calls a “lateral politics” as a way of bearing the impassivity of the transitional present, thereby allying herself with a purely radical democratic form of sensual politics, I would suggest that the inhabitation of the contemporary critical impasse would do better to join radical democratic critique with elements of the critique of political economy rather than to separate these two critical perspectives.70 Indeed, as Berlant writes, the historical present as impasse is “a situation that can absorb many genres without having one itself.”⁷¹ In that light, what is needed to navigate this impasse theoretically is a synthesis of radical democratic and Marxist genres of critique. What hinders this synthesis, on the one hand, is the attachment of radical democratic theory to a formalist mode of critique that ultimately is based upon a liberal framework. On the other hand, Marxist theory has paid insufficient attention to the experiential, aesthetic, and perceptual dimensions of neoliberal domination. A synthesis of these two modes of critique can be useful for navigating the theoretical impasse of the transitional present.

When I refer to liberal forms of critique, I am denoting political theories founded on concepts of economics and politics derived, either explicitly or implicitly, from the social form of liberal capitalism, a paradigm based upon a social ontology in which the economic and political spheres are conceived as bounded and the state takes a laissez-faire stance in relationship to civil society and the market. I am not engaging here in a broader discussion of liberalism as such. To be clear, liberalism is a complex body of thought and practice, and my intention is not to essentialize liberalism. Yet I think it is useful to speak of liberalism more generally as an approach to political critique that is based upon certain sociological and ontological premises. As Wendy Brown writes, “Liberalism is a nonsystematic and porous doctrine subject to historical change and local variation. However, insofar as liberalism takes its definitional shape from an ensemble of relatively abstract ontological and political claims, it is also possible to speak of liberalism in a generic fashion.”⁷² Moreover, I am not referring to particular thinkers of the liberal tradition, such as John Locke or John Stuart Mill, but rather to a more general framework for theoretically parsing the relationship between the economic and political spheres of society.⁷³ My intention here is to identify the ways in which liberalism as a mode of political critique functions, largely implicitly, in the context of neoliberalism. Indeed, my main preoccupation is not with liberal political theory as such, but with radical democratic theories of the left that unintentionally adopt key dimensions of a liberal social ontology.

The dimension of liberal critique that I want to draw attention to is its formalism. By formalism, I mean a method of critique that operates by abstracting theoretical categories from the historical, sociological, and political contents that give these categories their meaning.74 Liberal formalism operates by working the form of normative concepts, such as liberty, against their social content. In addition, liberal formalism is based upon a sociological premise that also has normative implications: the separation of the economic and political spheres. While liberal formalism had important emancipatory effects in earlier phases of capitalism, in the context of neoliberal transformations of the relationship between economics and politics it functions in a paradoxical way that is no longer sufficient to critique neoliberal domination. Formalistic and ahistorical theories of politics that see the categories of economics and politics as fundamentally bounded will be unable to account for the fluidity of the relationship between economics and politics in neoliberalism or the neoliberal state’s ambivalent relationship to the economy.

Jürgen Habermas’s The Structural Transformation of the Public Sphere is a crucial source for demonstrating the historical specificity of liberal formalism as an emancipatory discourse. Habermas shows that classical liberal notions of publicity emerged from historically specific sociological conditions.⁷⁵ Habermas discusses the historical basis of the distinction between the economy and politics in the development of liberal capitalism from the eighteenth to the twentieth centuries and details the rise of the bourgeois public sphere, which arose amid the shift from monarchies to constitutional states in Western Europe in the eighteenth century.

According to Habermas, the public sphere that came about within the frame of eighteenth-century civil society was a space that conceived of itself as open to all.76 Yet the restriction of the franchise based on property ownership meant that economic status was directly linked to political access. The emergent bourgeois public sphere could only conceive of itself as open to all because all, in principle, were capable of owning property, in contrast to the conditions of feudal society. Classical economists, including Adam Smith, Jeremy Bentham, and James Mill, began from the following premises: that the economic realm was characterized by free competition, that commodities were exchanged according to their value, and that supply and demand would stay in equilibrium. If these conditions held true, then each individual would indeed have the chance to become a property owner. However, these conditions, Habermas notes, were not fulfilled, and so the question becomes how did the liberal public sphere sustain its legitimating norm as a space in which domination could be rationalized through critical public debate that was in principle open to all? Habermas’s answer illuminates the historical specificity of liberalism as an emancipatory discourse, and he argues that in the eighteenth and early nineteenth centuries the liberal model of citizenship, which made property a requirement of citizenship, depended on the economic conditions stipulated by classical economics regarding free markets, perfect competition, and commodity exchange.

However, even though these economic conditions were not completely fulfilled in reality, Habermas nevertheless contends that “the liberal model sufficiently approximated reality so that the interest of the bourgeois class could be identified with the general interest.”⁷⁷ The interest of the property-owning class could be identified with the general interest because in this historical period, with the formation of the constitutional state out of monarchical authority, capitalist exchange and the rise of a property-owning class was the means by which the political emancipation of large segments of the population was achieved. Property owners thus held a unique position in the early phases of capitalist development in Europe insofar as they had private interests that automatically converged with the general interest to maintain civil society as a private sphere rather than as a sphere under the influence of monarchical authority. As Habermas writes, “Only from them [the property owners], therefore, was an effective representation of the general interest to be expected, since it was not necessary for them in any way to leave their private existence behind to exercise their public role. For the private person, there was no break between homme and citoyen, as long as the homme was simultaneously an owner of private property who as citoyen was to protect the stability of the property order as a private one.”⁷⁸ In the transition from feudalism to capitalism, the rights of the property owner could be identified with the general interest inasmuch as the creation of civil society (the private sphere) allowed for the emergence of a space of critical rational debate over matters of political public significance.

Indeed, the defense of private property and the boundary between politics and economics in this period could be seen as emancipatory in the sense that it created conditions for the democratization of society, and, in the early phases of liberal capitalism, the interests of capital could be identified with the general interest. This is not to say that early liberal capitalism in Europe did not create inequality or injustices. Even Adam Smith, in Wealth of Nations, readily acknowledges the pitfalls of free markets, at the same time he celebrates the great progress created by them.

Likewise, feminist responses to Habermas’s work have highlighted the exclusionary aspects of the liberal public sphere.79 Even in this period liberalism functioned as an ideology. The normative separation of economics and politics functioned as a discourse that obfuscated inequality in the private sphere as well as an emancipatory discourse. In Habermas’s words, liberal formalism functioned as “ideology and simultaneously more than mere ideology.”⁸⁰ In this historical period, the creation of a bourgeois public sphere was born of a tension that generated emancipatory effects: in the public sphere economic inequalities were suspended, even as they provided the condition of possibility for the very existence of the public sphere.

However, this tension between inequality in civil society and abstract equality in the public sphere no longer functions toward emancipatory ends in neoliberalism. Habermas demonstrates clearly that the normative self-understanding of liberalism, as instantiated in the institution of the bourgeois public sphere, was dependent upon socioeconomic conditions of possibility that are historically specific to this period of liberal capitalism. In neoliberal capitalism, however, the function of the liberal ideology of the separation between economics and politics functions quite differently. In this case, the normative separation between economics and politics, derived from liberal sources of critique, fundamentally misses the porousness and flexibility of the distinction between the economic and political spheres in neoliberal society and the ambivalence of the neoliberal state. As long as we define economics and politics using the sociological premises of earlier phases of capitalism, political theorists will overlook the extent to which neoliberal domination operates by exploiting the increasing porousness of the boundary between economy and politics.

Therefore it is crucial to observe the changing valence of liberal ideas in historical context. Whereas liberal formalism may have had significant emancipatory effects in the eighteenth and nineteenth centuries, as Habermas shows, the emancipatory impact of liberal formalism in the context of contemporary neoliberalism must be placed into question. In the current context, liberal formalism legitimates and obscures the economization and commodification of social and political life.

In her work on neoliberalism, Wendy Brown points to the obsolescence of liberal formalism. She writes, “The space between liberal democratic ideals and lived realities has ceased to be exploitable because liberal democracy itself is no longer the most salient discourse of political legitimacy and the good life. Put the other way around, the politically exploitable hollowness in formal promises of freedom and equality has largely vanished to the extent that both freedom and equality have been redefined by neoliberalism.”81 I agree with Brown’s assessment that liberal formalism in the context of neoliberalism is to a great degree no longer “politically exploitable.” Yet I would furthermore suggest that liberal democracy nevertheless remains a crucial discourse of political legitimacy in contemporary society. The fact that neoliberalism redefines both freedom and equality has indeed eviscerated liberalism. However, liberalism remains a prominent political discourse, perhaps increasingly not as a discourse about the good life, but as a theory about the relationship between the state and civil society. To the degree that aspects of liberalism remain salient, neoliberalism perpetuates forms of domination not only by displacing liberalism (as a discourse about the good life) but also by making use of liberalism’s formalistic modes of critique.

In the post-2008 context the effects of neoliberalism have been the subject of critique by political theorists of many different persuasions. The critique of economic domination is no longer exclusively the project of Marxist theory. Yet liberal and communitarian analyses of the current conjuncture have tended to address the increasing economization of social life in neoliberalism through analyses of inequality and critiques of the moral limits of markets. Michael Sandel’s work, to take a prominent example, criticizes what he calls “market triumphalism,” extensively detailing the ways in which contemporary society has been marketized.⁸² As evidence of the unbridled marketization he decries, Sandel points to the fact that it is possible today to buy such things as a prison cell upgrade, the admission of your child to a prestigious university, and the cellphone number of your doctor. Certainly, the fact that one can buy the rights to such things is central to the new forms of domination perpetuated by neoliberalism. Sandel addresses this problem by demanding that we evaluate the “morality of markets” and “rethink the role and reach of markets in our social practices, human relationships, and everyday lives.”⁸³ However, insofar as he approaches such issues through a purely moral approach, devoid of an exploration of the economic structures within neoliberal society linked with the moral failings of markets, Sandel’s work neglects the neoliberal reconfiguration of the politics-economy relation. Critiques of the increasing marketization and economization of contemporary society and the moral problems generated by them, I suggest, would be more effective if aimed at the sources of such phenomena rather than merely their symptoms. What Sandel misses is that the increasing marketization of society is a symptom of a larger transformation in the very contents of economics and politics in contemporary society.

Yet it isn’t only liberals and communitarians that have underestimated the implications of the neoliberal transformation of the relationship between economics and politics for critique. More relevant for my analysis here is the way in which self-proclaimed radical thinkers have also engaged in a self-undermining formalism that does not critically appreciate the implications of the neoliberal resignification and inversion of liberalism. Here my primary concern is with the work of radical democratic theorists who have criticized Marxist approaches to capitalist domination from the left, including thinkers such as Rancière, Laclau, and Mouffe. Radical democratic theorists have responded to neoliberal forms of depoliticization not by examining the changing relationship between economics and politics but rather by asserting the autonomy of politics from the economy as an axiomatic property of politics. Such attempts to repoliticize the public sphere through formalist conceptions of politics, however, miss the specific dynamics of depoliticization in neoliberal society, which trade on the fluidity of the boundary between economics and politics and the ambivalence of the neoliberal state toward the economy. Contemporary radical democratic theorists use a formal concept of the political as a way to describe a certain logic of subversion and dissensus that is resistant or parallel to the logics of capital. Yet the overly abstract conception of the political deployed by many radical democrats, I suggest, paradoxically has the opposite effect. Theories of radical democracy overlook the ways in which the neoliberal inversion of liberalism resignifies formalistic modes of political critique.

By contrast, contemporary Marxist political theorists focus on the mediations between economics and politics and thereby avoid the pitfalls of radical democratic formalism. However, the neo-Marxist approach to political economy is insufficiently attentive to the perceptual and experiential dimensions of neoliberalism. Invoking analyses of political economy that are abstracted from the ways in which neoliberal subjects experience their social and political worlds similarly displaces the impasse between the economic and political dimensions of neoliberalism to a different level.

Radical democratic theorists of the political do not reject the concept of democracy; however they call for its resignification in contemporary context. While these theorists’ positions are so widely diverse that it would be difficult to categorize their work on democracy into a theoretical school or unified perspective, I suggest that they share a resemblance that delineates an important approach to progressive political theory. Radical democratic theorists have sought to rescue democracy through a reinterpretation of the concept of the political. This notion of the political, which is typically conceived by radical democrats as ephemeral, rare, and heterogeneous both to institutions of rule as well as to socioeconomic logics, becomes the principle by which radical democrats have sought to recuperate democracy from its neoliberal deformation. Yet, by making use of a formal conception of the political, these theorists share an implicit commitment to the autonomy of politics from economics. This commitment, I argue, marks these theorists as bound to the formalism that I earlier critiqued. Insofar as this is the case, radical democratic theorists remain wedded to understandings of the relationship between economics and politics that are no longer adequate to critique forms of neoliberal domination.

It is important to first address the question of why there has been a turn toward understanding democracy primarily through a conception of politics that is conceived as autonomous from the economic sphere. My sense is that there are three fundamental reasons for this turn. First, the autonomy of the political is a response to the economism of twentieth-century Marxism. Key radical democratic theorists have positioned themselves through a conflictual engagement with Marxism—whether it be through a broader engagement with Marxism, as in the case of Laclau and Mouffe, or, as in the case of Rancière, through a critique of the structural Marxism of Louis Althusser.85 Both Laclau and Mouffe and Rancière reject or reinterpret some of the salient presuppositions of twentieth-century Marxism, primarily the emphasis on the dialectical relationship between forms of economy and forms of subjectivity, and the centrality of the commodification and the production process to understanding the logics of the bourgeois political sphere.⁸⁶ This departure of radical democracy from Marxism is most explicitly articulated by Laclau and Mouffe in their classic work Hegemony and Socialist Strategy. As they write in the preface to the 2000 edition of the work,

To reread Marxist theory in light of contemporary problems necessarily involves deconstructing the central categories of that theory. This is what has been called our “post-Marxism.” We did not invent this label. … But since it has become generalized in characterizing our work, we can say that we do not oppose it insofar as it is properly understood: as the process of reappropriation of an intellectual tradition, as well as the process of going beyond it. And in developing this task, it is important to point out that it cannot be conceived just as an internal history of Marxism. Many social antagonisms, many issues which are crucial to the understanding of contemporary societies, belong to fields of discursivity which are external to Marxism, and cannot be reconceptualized in terms of Marxist categories.⁸⁷

Therefore, while Laclau and Mouffe offer a reinterpretation of Marxist categories, they stress that their perspective pushes beyond those concepts. Laclau and Mouffe articulate their project of radical democracy as a direct response to the impasse of Marxist theory in the aftermath of the struggles of the 1960s. Their work takes the Gramscian account of hegemony as the central category of a radical democratic politics and reinterprets notions of class struggle around the centrality of discursive articulation in opposition to a scientific Marxism whose economism had elided the field of political antagonism that Laclau and Mouffe grasped as central to democratic politics. Through a careful genealogy of Marxism from Vladimir Lenin to Karl Kautsky to Eduard Bernstein and finally to Antonio Gramsci, Laclau and Mouffe make the autonomization of the political from an essentialist notion of the economic the cornerstone of radical democracy in opposition to traditional Marxism.⁸⁸

Second, the autonomy of the political is part of a critique of liberal democratic institutions and its attendant forms of depoliticization. Among others, Mouffe and Rancière reorient democratic theory around the values of agonism and dissensus as a counter to the attempts of liberalism to rationalize and sublimate conflict. As Mouffe writes, “Liberal theorists envisage the field of politics as a neutral terrain in which different groups compete to occupy the positions of power, their objective being to dislodge others in order to occupy their place, without putting into question the dominant hegemony and profoundly transforming the relations of power. … In an agonistic politics, however, the antagonistic dimension is always present, since what is at stake is the struggle between opposing hegemonic projects which can never be reconciled rationally.”89 Recognizing the sheer contingency of any hegemonic articulation, according to Mouffe, including that of neoliberalism, can contribute to a revitalization and deepening of democracy.⁹⁰ Thus agonism counters the closure of democracy perpetuated by liberal political theory and practice. The political is grasped as irreducibly characterized by conflict, dissensus, or agonism and, in this sense, is ontologically grasped as a source of contingency and potential disruption of any particular institutional arrangement of society. The political is therefore not autonomous in the sense of being sovereign, it is autonomous in its sheer irreducibility and heterogeneity to extant social forms.⁹¹

But third, and perhaps most important, an autonomous conception of politics is the radical democratic response to the expansion of corporate economic power and its incursion into the political realm. In response to the assault of global capitalism upon sites of political struggle, radical democratic theorists have argued for a reinterpretation of the concept of the political as a way of resisting the invasion of capital into the realm of the political. Rancière, for example, targets his theory against what he calls “post-democracy,” a form of democracy that has eliminated the appearance of dissensus and the “miscount” of the people and rendered the citizen a mere consumer in the midst of supposedly inexorable economic forces.⁹² As Rancière writes,

But if the depoliticizing effects of capitalism are, as Rancière suggests, “obvious,” the critical response that democratic theorists must take in response to the neoliberal elision of dissensus and the neutralization of democracy is not. In contrast to Marxists, those theorists that I’m referring to as radical democrats have responded to the depoliticizing effects of capitalism by recuperating a notion of the political that is constitutively heterogeneous to capital.

A key theoretical move in the work of, among others, Mouffe, Laclau, Sheldon Wolin, and arguably Rancière is the distinction between two senses of politics: first, politics as a form of administration, policy, mode of governance, or management; second, politics as a form of constitution.⁹⁴ Oliver Marchart traces this conceptual distinction from its inception in the French context as the difference between la politique (“politics”) and le politique (“the political”), which characterizes what Marchart has referred to as theories of “political difference.”⁹⁵ By distinguishing these two senses of politics, radical democrats seek to disarticulate the specificity of the political from the reduction of politics to mere management, governmentality, or economic administration. In Marchart’s left-Heideggerian exposition of this distinction, the difference between politics and the political “will have to be understood as nothing but the symptom of society’s absent ground.”⁹⁶ Marchart claims,

As differentiated from politics, the notion of the political cannot be assimilated to social differences, to repetition, tradition, sedimentation, or bureaucracy. Like other figures of contingency and groundlessness, such as the event, antagonism, truth, the real, or freedom, the political dwells, as it were, on society’s non-ground. … But society’s absent ground is not “merely” absent. It (re-)appears and is supplemented by the moment which we may call, with reference to J. G. A. Pocock’s “Machiavellian moment” (1975), the moment of the political.⁹⁷

I am aware that there are many subtle differences among the thinkers that I have characterized as radical democrats. Lars Tønder and Lasse Thomassen, for example, characterize the central divide among radical democratic theorists as hinging upon their allegiance to two distinct ontologies, an ontology of abundance and an ontology of lack, and they draw out the divergent political implications of these two approaches.98 Samuel Chambers, moreover, makes a thorough case for Rancière’s distinction from other radical democrats, arguing, for example, that Rancière’s political theory is ultimately not based on the distinction between politics and the political and that Rancière’s theory, unlike those of other radical democrats, does not advance a political ontology.⁹⁹ Yet I would side with Marchart in his characterization that the differences between these thinkers are secondary compared with what they share with respect to their conceptualization of the political, though I take issue with Marchart’s assessment of the political effectiveness of radical democratic critique.¹⁰⁰

Perhaps controversially, I take this broad theoretical turn in democratic theory toward an autonomous conception of politics as something that is ultimately symptomatic of neoliberalism, insofar as neoliberalism continues to legitimate itself through a formalism derived from liberalism, even as neoliberalism has eviscerated liberal norms of critique. In the subsequent section I show how Rancière’s conception of the political recapitulates the problem of liberal formalism. I choose to focus on Rancière because I take his theory to illustrate, perhaps more clearly than any of the other radical democrats, what I call the problem of formalism. However, I also focus on Rancière because I think his work shows most clearly what must be retained of radical democratic theory in a reconstructed critique that synthesizes the critique of political economy with a theory of radical democracy, which is an emphasis on the perceptual and aesthetic dimensions of politics. In short, Rancière reveals, to my mind, both that which is most problematic in theories of radical democratic theory as well as that which is most persuasive in them.

Dissensus occurs through the perpetual conflict between two antagonistic logics operative in society, which Rancière labels with the concepts of “politics” on the one hand and “police” on the other. The concepts of politics and the police express a polarity that is inherent to social life and creates the always contingent conditions for democracy. In Rancière’s theory, “police” idiosyncratically refers to, in his words, “an order of bodies that defines the allocation of ways of doing, ways of being, and ways of saying, and sees that those bodies are assigned by name to a particular place and task.”102 In essence, therefore, while in Rancière’s lexicon police is a term that cannot be reduced to either the state or to the economy (or to the security apparatus of the state, as one might think at first glance), it contains both these aspects of society and refers to the means of social integration and legitimation that allow societies to function.

However, police also refers to the aesthetic and social distribution of parts and roles in a community, based upon what Rancière calls the “distribution of the sensible.”¹⁰³ The police order refers to the boundary between that which is visible and invisible, speakable and unspeakable, and, most important, the boundary between those who are included in the community and those who are merely the part which has no part.¹⁰⁴ The concept of the police therefore does not refer to a repressive order as such, despite the common usage of the term police, though it does put forth an understanding of social ordering as antagonistic to the logic of the political.

Politics, by contrast, refers to acts and practices that deploy the principle of equality and thereby undo or disrupt the ordering functions of the police by creating a dissensual rupture within the existing distribution of the sensible.¹⁰⁵ Rancière identifies democracy with this kind of dissensual politics and argues that democratic politics occurs in direct antagonism to the police.

The crucial move in Rancière’s work that I want to highlight is his emphasis on form in his understanding of politics. According to Rancière, “What makes an action political is not its object or the place where it is carried out, but solely its form, the form in which the confirmation of equality is inscribed in the setting up of a dispute.”¹⁰⁶ Through this definition of the political, Rancière argues that the conditions of politics are neither social nor institutional nor economic in nature. Rather, form takes the place of conditions in defining the specificity of democratic politics. Democracy is therefore a rare and ephemeral event, according to Rancière, one that cannot be reduced to extrapolitical determinants or conditions.

Rancière’s emphasis on the autonomy of politics, which emphasizes the form of politics rather than its conditions of possibility, ostensibly seeks to avoid the reduction of politics to an expression of underlying social or economic phenomena. Rancière’s focus on the autonomy of politics, I suggest, attempts to repoliticize the public sphere by introducing a conception of politics that is inherently resistant to and autonomous from the depoliticizing logic of capital. Rancière’s conception of the autonomy of the political eradicates the basis for an understanding of the relationship between economic forms of domination and political struggle and his emphasis on the “form” of politics, as opposed to its “content,” and the contingency of politics, rather than its conditions, leaves him unable to account for the historical variability of democratic forms. In other words, Rancière’s theory reproduces the problem of formalism: by abstracting from the historical specificity of political forms, the theory is unable to account for transformations in the content of politics in neoliberal society.

Yet the status of the autonomy of the political thesis in Rancière’s theory is complicated and has been the subject of much scholarly debate. Importantly, Rancière does not argue that politics occurs in a sphere of society distinct from economic or social life. Politics, and its opposing concept of the police, do not refer to bounded, separate spheres of society that exclude one another. To the contrary, according to Rancière, acts of democratic politics occur precisely by blurring the boundaries between separate spheres of the police order. Moreover, politics occurs through the polemical, dissensual reconfiguration of the aesthetic field of perception that is held in common, what Rancière calls “the distribution of the sensible.”107 According to Rancière, politics happens precisely as a process of disruption within the police order, as politics has no proper place of its own.

Although many commentators have interpreted Rancière as putting forth a pure conception of politics, according to Chambers, Rancièreian politics is quite the opposite: it is “an act of impurity, a process that resists purification.”¹⁰⁸ This is because Rancière’s politics has no ontological status. It is rather a movement, a torsion within the police order provoked by dissensual deployments of the logic of equality. If, as Chambers claims, Rancière’s conception of politics is not ontological, but rather thoroughly deessentializing and nonsingular, this would call into question my claim that Rancière theorizes politics as autonomous from other spheres of society.

I would argue that despite cogent defenses by Chambers and other sympathetic commentators on Rancière’s work, Rancière’s conception of politics is one that emphasizes the autonomy of the political by neglecting the conditions of possibility of politics through a singular focus on questions of form. Even defining politics as a torsion within the social is nevertheless a formalist way of talking about politics. This is to say, it confines discussions of politics to the question of form. For Rancière, if an act takes the form of a torsion within the police order, a disruption or dissensus, then it qualifies as a moment of democratic politics, provided that it is also an articulation of the logic of equality. While this is a powerful way of distinguishing politics from administration or institutions, it becomes less useful if one wants to talk about specific logics inherent in the police order. This is because the concept of the police generalizes the social totality into an undifferentiated entity.109 The key problem with Rancière’s theory, then, is that his concept of the police does not differentiate between heterogeneous logics of domination within the police order and thus cannot grasp the historically specific dynamics of economic domination in contemporary society. Ultimately, I would suggest, in response to Chambers, that the purity of Rancière’s politics comes from its indifference to location or to content.

Yet I would add that key aspects of Rancière’s theory can be applied to the relationship between politics and economics itself. Rancière’s understanding of the police order as a nonhierarchical matrix is helpful insofar as it describes the process of subjective and experiential transformation at a micropolitical level. Rancière suggests that political transformation operates not primarily at the level of political institutions but through a transformation of the aesthetic distribution of sensibility and perception that is held in common by members of a society or group. Clarifying his understanding of the aesthetic dimension and its relation to politics, Rancière writes, “If the reader is fond of analogy, aesthetics can be understood in a Kantian sense—re-examined perhaps by Foucault—as the system of a priori forms determining what presents itself to sense experience. It is a delimitation of spaces and times, of the visible and the invisible, of speech and noise, that simultaneously determines the place and the stakes of politics as a form of experience.”¹¹⁰

Politics, for Rancière, has everything to do with specific aesthetic interventions into the distribution of common sense. When individuals view society as an aesthetic matrix rather than as a hierarchical totality, they can begin to experience social phenomena at a sensate level that pushes against the existing political forms that structure experience. For Rancière, politics is a process of reconfiguring the very a priori categories through which society is perceived, producing a rupture and transformation of these categories by constructing situations in which both speech and noise, both ruler and ruled, are given equal value in collective experience. Such politics, in Rancière’s account, provoke a deep restructuring of sensory experience.

Rancière’s attention to the dynamics of experiential transformation, I suggest, can be helpful to conceptualize alternatives to neoliberal forms of politics if applied specifically to issues of political economy, broadly conceived. Rancière’s somewhat polemical approach to critiques of political economy resists taking his theory in this direction. Yet scholars and activists, as I explore in chapters 6 and 7, have taken up this challenge in order to revitalize understandings of how capital is translated into the frame of human experience.

For example, J. K. Gibson-Graham argues that the perceptions of the economy in public and scholarly discourse tend to naturalize the economy and to foreclose alternative conceptions of how economies might be structured differently.¹¹¹ They argue that “in these postmodern times, the economy is denied the discursive mandate given to other social spheres and the consequences for the viability of any political project of economic innovation are dire.”¹¹² In effect, they are calling for social theorists to subject political economy itself to a deessentializing critique, focusing on practices, experiences, and forms of subjectivation rather than stratified economics concepts. Gibson-Graham, therefore, disarticulate the economy in order to denaturalize it, showing how concepts such as “exchange,” for example, can be broken down into many different kinds of exchange, such as nonmarket exchange, market exchange, and alternative markets.

By exploring the diverse logics of exchange present in contemporary capitalism, Gibson-Graham pay close attention to the ways in which economic categories are perceived experientially. They use the diversity of economic processes and forms to provoke ruptures in existing economic concepts and practices by refusing to prioritize one form of exchange over another. In the wake of Occupy Wall Street and the 2008 financial crisis, moreover, the question of the relationship between economics and subjective experience has been taken up by numerous artists working in diverse media. For example, How Much Is Enough? Our Values in Question, a theater piece by Melanie Joseph and Kirk Lynn, explores questions about economic value, provoking both audience members (who participate in the piece) and actors to answer difficult questions about how economic domination percolates into everyday experience in neoliberal society.113 While Rancière himself has not explored the ways in which his political theory might be applied to questions of economic domination and transformation, others have begun to perform this work practically. These kinds of artworks and practices, which I explore in chapters 6 and 7, begin to illuminate the importance of an approach that synthesizes political economy with attention to its relationship to political subjectivity and quotidian experience.

In part 2 I explore the relationship of neoliberal economics to subjective experience in greater depth. I argue that in neoliberalism “the economy” takes on a broader status as the general structuring principle of society in all of its spheres. It is not a spatially bound area of social life, but rather a form of abstract determination of the contours of social life, in the realms of public and private, circulation and consumption. Rancière takes the economy to be a bounded sphere of social life in his work (which is overdetermined by his polemical critique of Marxist critiques of political economy) and in so doing is unable to recognize that political economy could be more productively described as a specific dimension of the distribution of the sensible he so elegantly conceptualizes.¹¹⁴

Therefore, Rancière’s emphasis upon the specific perceptual and subjective dimensions of contemporary political struggle is important for theorizing alternatives to neoliberal political practices and forms. However, radical democratic theory must be decoupled from the principle of the autonomy of politics in order to address the specific dynamics of politics in neoliberal society. This attention to the experiential dimensions of politics can be mobilized for the purposes of theorizing alternatives to neoliberalism by synthesizing its attention to micropolitical experience with a historically specific critique of political economy in neoliberal society. I deal with the theme of how neoliberalism conditions political experience and political subjectivity more extensively in part 2.

This may seem perplexing. After all, contemporary Marxist scholars such as Harvey, Moishe Postone, and Duménil and Lévy, have put forth careful analyses of the ways in which political economy impacts the possibilities and forms of democratic practice. Yet many contemporary Marxists, in subtle ways, tend to play into the conceptual impasse between economics and the political. They do so not, like the radical democrats, by proclaiming the autonomy of the political but conversely by paying insufficient attention to the experiential, perceptual, and aesthetic dimensions of contemporary political struggles.

A few examples from contemporary Marxist theory illustrate this issue. In Time, Labor and Social Domination Postone insists that understanding the structure of the capitalist economy is fundamental to the project of comprehending democratic politics today beyond the formal character of liberal democracy. Fundamental to his argument is an analysis of the forms of abstract domination that characterize social relations under capitalism. Postone emphasizes the ways in which the economic structures of capitalist domination delimit and impact forms of political practice. Without an account of the ways in which the capitalist economy structures human practice, Postone argues, political theory lapses into abstraction, unable to grasp the real social conditions of democracy. As a result, he studies concrete political struggles in their relation to commodity production and circulation, analyzing the extent to which political practices and institutions are either “capital-constituting” or “capital-transcending.”115 Although Postone’s position is sophisticated and has influenced my own work significantly, I see his work as an invitation to attend more deeply to concrete political struggles on the aesthetic, perceptual, and experiential registers, to synthesize radical democratic and Marxist approaches to critique.

Similarly to Postone, Harvey’s work on neoliberalism describes the way in which the possibilities of political practice in the contemporary neoliberal conjuncture have taken two predominant forms, which correspond to the currently dominant structural forms of capitalist domination: on the one hand, struggles around the exploitation of wage labor and conditions defining the social wage and, on the other hand, struggles against primitive accumulation, including the dispossession of populations from their land, withdrawal of the state from its historical social welfare obligations, and forms of dispossession brought about by the alliance of finance capital with the state (i.e., the Wall Street bailout).¹¹⁶

While Harvey’s theory of the relationship between economy and politics is sophisticated and important, the point is that his theory nevertheless views politics as operating within the structural constraints generated by economic dynamics. According to such an approach, analyzing the dynamic of capitalist accumulation and its relation to political movements takes priority in political analysis. But his account has little to say about the experiential dimensions of political movements or the sense in which they are democratic. I take this underemphasis in Postone’s and Harvey’s work as an invitation to probe more deeply into how political economic logics and concepts are deployed in political practice at an experiential level. Part 3 of the book explores what such an analysis would look like.