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Neoliberalism and the Demise of Democracy:
Resurrecting Hope in Dark Times

by Henry A. Giroux
August 7, 2004

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Neoliberalism has become one of the most pervasive, if not, dangerous ideologies of the 21st century. Its pervasiveness is evident not only by its unparalleled influence on the global economy, but also by its power to redefine the very nature of politics itself. Free market fundamentalism rather than democratic idealism is now the driving force of economics and politics in most of the world, and it is a market ideology driven not just by profits but by an ability to reproduce itself with such success that, to paraphrase Fred Jameson, it is easier to imagine the end of the world than the end of neoliberal capitalism.

Wedded to the belief that the market should be the organizing principle for all political, social, and economic decisions, neoliberalism wages an incessant attack on democracy, public goods, the welfare state, and non-commodified values. Under neoliberalism everything either is for sale or is plundered for profit. Public lands are looted by logging companies and corporate ranchers; politicians willingly hand the public’s airwaves over to powerful broadcasters and large corporate interests without a dime going into the public trust; Halliburton gives war profiteering a new meaning as it is granted corporate contracts without any competitive bidding and then bilks the U.S. government for millions; the environment is polluted and despoiled in the name of profit-making just as the government passes legislation to make it easier for corporations to do so; public services are gutted in order to lower the taxes of major corporations; schools more closely resemble either malls or jails, and teachers are forced to get revenue for their school by hawking everything from hamburgers to pizza parties. As markets are touted as the driving force of everyday life, big government is disparaged as either incompetent or threatening to individual freedom, suggesting that power should reside in markets and corporations rather than in governments (except for their support for corporate interests and national security) and citizens.

Under neoliberalism, the state now makes a grim alignment with corporate capital and transnational corporations. Gone are the days when the state “assumed responsibility for a range of social needs.” [1] Instead, agencies of government now pursues a wide range of “‘deregulations,’ privatizations, and abdications of responsibility to the market and private philanthropy.” [2] Deregulation, in turn, promotes “widespread, systematic disinvestment in the nation’s basic productive capacity.” [3] Flexible production encourages wage slavery and disposable populations at home. And the search for ever greater profits leads to outsourcing which accentuates the flight of capital and jobs abroad. Neoliberalism has now become the prevailing logic in the United States, and according to Stanley Aronowitz “...the neoliberal economic doctrine proclaiming the superiority of free markets over public ownership, or even public regulation of private economic activities, has become the conventional wisdom, not only among conservatives but among social progressives.” [4]

The ideology and power of neoliberalism also cuts across national boundaries. Throughout the globe, the forces of neoliberalism are on the march, dismantling the historically guaranteed social provisions provided by the welfare state, defining profit-making as the essence of democracy, and equating freedom with the unrestricted ability of markets to “govern economic relations free of government regulation.” [5] Transnational in scope, neoliberalism now imposes its economic regime and market values on developing and weaker nations through structural adjustment policies enforced by powerful financial institutions such as the World Bank, the International Monetary Fund (IMF), and the World Trade Organization (WTO). Secure in its dystopian vision that there are no alternatives, as England’s former Prime Minister Margaret Thatcher once put it, neoliberalism obviates issues of contingency, struggle, and social agency by celebrating the inevitability of economic laws in which the ethical ideal of intervening in the world gives way to the idea that we “have no choice but to adapt both our hopes and our abilities to the new global market.” [6] Coupled with a new culture of fear, market freedoms seem securely grounded in a defense of national security, capital, and property rights. When coupled with a media driven culture of fear and the everyday reality of insecurity, public space becomes increasingly militarized as state governments invest more in prison construction than in education. Prison guards and security personnel in public schools are two of the fastest growing professions.

In its capacity to dehistoricize and depoliticize society, as well as in its aggressive attempts to destroy all of the public spheres necessary for the defense of a genuine democracy, neoliberalism reproduces the conditions for unleashing the most brutalizing forces of capitalism. Social Darwinism has been resurrected from the ashes of the 19th century sweatshops and can now be seen in full bloom in most reality TV programs and in the unfettered self-interests that now drives popular culture. As narcissism is replaced by unadulterated materialism, public concerns collapse into utterly private considerations and where public space does exist it is mainly used as a confessional for private woes, a cut throat game of winner take all, or a advertisement for consumerism.

Neoliberal policies dominate the discourse of politics and use the breathless rhetoric of the global victory of free-market rationality to cut public expenditures and undermine those non-commodified public spheres that serve as the repository for critical education, language, and public intervention. Spewed forth by the mass media, right-wing intellectuals, religious fanatics, and politicians, neoliberal ideology, with its ongoing emphasis on deregulation and privatization, has found its material expression in an all-out attack on democratic values and on the very notion of the public sphere. Within the discourse of neoliberalism, the notion of the public good is devalued and, where possible, eliminated as part of a wider rationale for a handful of private interests to control as much of social life as possible in order to maximize their personal profit. Public services such as health care, child care, public assistance, education, and transportation are now subject to the rules of the market. Construing the public good as a private good and the needs of the corporate and private sector as the only source of investment, neoliberal ideology produces, legitimates, and exacerbates the existence of persistent poverty, inadequate health care, racial apartheid in the inner cities, and the growing inequalities between the rich and the poor. [7]

As Stanley Aronowitz points out, the Bush administration has made neoliberal ideology the cornerstone of its program and has been in the forefront in actively supporting and implementing the following policies:

[D]eregulation of business at all levels of enterprises and trade; tax reduction for wealthy individuals and corporations; the revival of the near-dormant nuclear energy industry; limitations and abrogation of labor’s right to organize and bargain collectively; a land policy favoring commercial and industrial development at the expense of conservation and other pro environment policies; elimination of income support to the chronically unemployed; reduced federal aid to education and health; privatization of the main federal pension programs, Social Security; limitation on the right of aggrieved individuals to sue employers and corporations who provide services; in addition, as social programs are reduced, [Republicans] are joined by the Democrats in favoring increases in the repressive functions of the state, expressed in the dubious drug wars in the name of fighting crime, more funds for surveillance of ordinary citizens, and the expansion of the federal and local police forces. [8]

Central to both neoliberal ideology and its implementation by the Bush administration is the ongoing attempts by free-market fundamentalists and right wing politicians to view government as the enemy of freedom (except when it aids big business) and discount it as a guardian of the public interest. The call to eliminate big government is neoliberalism’s great unifying idea and has broad popular appeal in the United States because it is a principle deeply embedded in the country’s history and tangled up with its notion of political freedom. And yet, the right wing appropriation of this tradition is racked with contradictions in terms of neoliberal policies.

The advocates of neoliberalism have attacked what they call big government when it has provided essential services such as crucial safety nets for the less fortunate, but they have no qualms about using the government to bailout the airline industry after the economic nosedive that followed the 2000 election of George W. Bush and the events of 9/11. Nor are there any expressions of outrage from the cheerleaders of neoliberalism when the state engages in promoting various forms of corporate welfare by providing billions of dollars in direct and indirect subsidies to multinational corporations. In short, government bears no obligation for either the poor and dispossessed or for the collective future of young people.

As the laws of the market take precedence over the laws of the state as guardians of the public good, the government increasingly offers little help in mediating the interface between the advance of capital and its rapacious commercial interests. Neither does it aid non-commodified interests and non-market spheres that create the political, economic, and social spaces and discursive conditions vital for critical citizenship and democratic public life. Within the discourse of neoliberalism, it becomes difficult for the average citizen to speak about political or social transformation, or to even challenge, outside of a grudging nod toward rampant corruption, the ruthless downsizing, the ongoing liquidation of job security, or the elimination of benefits for people now hired on part-time.

The liberal democratic vocabulary of rights, entitlements, social provisions, community, social responsibility, living wage, job security, equality, and justice seem oddly out of place in a country where the promise of democracy has been replaced by casino capitalism, a winner-take-all philosophy, suited to lotto players and day traders alike. As corporate culture extends even deeper into the basic institutions of civil and political society, buttressed daily by a culture industry largely in the hands of concentrated capital, it is reinforced even further by the pervasive fear and insecurity of the public that the future holds nothing beyond a watered down version of the present. As the prevailing discourse of neoliberalism seizes the public imagination, there is no vocabulary for progressive social change, democratically inspired visions, or critical notions of social agency to expand the meaning and purpose of democratic public life. Against the reality of low wage jobs, the erosion of social provisions for a growing number of people and the expanding war against young people of color at home and empire-building abroad, the market-driven juggernaut of neoliberalism continues to mobilize desires in the interest of producing market identities and market relationships that ultimately sever the link between education and social change while reducing agency to the obligations of consumerism.

As neoliberal ideology and corporate culture extend even deeper into the basic institutions of civil and political society, there is a simultaneous diminishing of non-commodified public spheres —those institutions such as public schools, independent bookstores, churches, noncommercial public broadcasting stations, libraries, trade unions and various voluntary institutions engaged in dialogue, education, and learning–that address the relationship of the individual to public life and foster social responsibility and provide a robust vehicle for public participation and democratic citizenship. In the vacuum left by diminishing democracy, religious zealotry, cultural chauvinism, xenophobia, and racism have become the dominant tropes of neoconservatives and other extremist groups eager to take advantage of the growing insecurity, fear, and anxiety that result from increased joblessness, the war on terror, and the unraveling of communities.

As a result of the consolidated corporate attack on public life, the maintenance of democratic public spheres from which to launch a moral vision or to engage in a viable struggle over politics loses all credibility–not to mention monetary support. As the alleged objectivity of neoliberal ideology remains largely unchallenged within dominant public spheres, individual critique and collective political struggles become more difficult. [9] It gets worse. Dominated by extremists, the Bush administration is driven by an arrogance of power and inflated sense of moral righteousness mediated largely by a false sense of certitude and never ending posture of triumphalism. As George Soros points out this rigid ideology and inflexible sense of mission allows the Bush administration to believe that “because we are stronger than others, we must know better and we must have right on our side. This is where religious fundamentalism comes together with market fundamentalism to form the ideology of American supremacy.” [10]

As public space is increasingly commodified and the state becomes more closely aligned with capital, politics is defined largely by its policing functions rather than an agency for peace and social reform. As the state abandons its social investments in health, education, and the public welfare. It increasingly takes on the functions of an enhanced police or security state, the signs of which are most visible in the increasing use of the state apparatus to spy on and arrests its subjects, the incarceration of individuals coincided disposable (primarily people of color), and the ongoing criminalization of social policies. Examples of the latter include anti-begging ordinances and anti-loitering that fine or punish homeless people for sitting or lying down too long in public places. [11] An even more despicable example of the barbaric nature of neoliberalism with its emphasis on profits over people and its willingness to punish rather than serve the poor and disenfranchised can be seen in the growing tendency of many hospitals across the country to have patients arrested and jailed if they cannot pay their medical bills. The policy, right out of the pages of George Orwell’s 1984, represents a return to debtors prisons, which is now chillingly called “body attachment,” and is “ basically a warrant for... the patient’s arrest.” [12]

Neoliberalism is not simply an economic policy designed to cut government spending, pursue free trade policies, and free market forces from government regulations; it is also a political philosophy and ideology that effects every dimension of social life. Neoliberalism has heralded a radical economic, political, and experiential shift that now largely defines the citizen as a consumer, disbands the social contract in the interests of privatized considerations, and separates capital from the context of place. Under such circumstances, neoliberalism portends the death of politics as we know it, strips the social of its democratic values, and reconstructs agency in terms that are utterly privatized and provides the conditions for an emerging form of proto-fascism that must be resisted at all costs. Neoliberalism not only enshrines unbridled individualism, it also destroys any vestige of democratic society by undercutting its “moral, material, and regulatory moorings,” [13] and in doing so it offers no language for understanding how the future might be grasped outside of the narrow logic of the market. But there is even more at stake here than the obliteration of public concerns, the death of the social, the emergence of a market-based fundamentalism that undercuts the ability of people to understand how to translate the privately experienced misery into collective action, and the elimination of the gains of the welfare state. There is also the growing threat of displacing “political sovereignty with the sovereignty of the market, as if the latter has a mind and morality of its own.” [14] As democracy becomes a burden under the reign of neoliberalism, civic discourse disappears and the reign of unfettered social Darwinism with its survival-of-the-slickest philosophy emerges as the template for a new form of proto-fascism. None of this will happen in the face of sufficient resistance, nor is the increasing move toward proto-fascism inevitable, but the conditions exist for democracy to lose all semblance of meaning in the United States..

Educators, parents, activists, workers, and others can address this challenge by building local and global alliances and engaging in struggles that acknowledge and transcend national boundaries, but also engage in modes of politics that connect with people’s everyday lives. Democratic struggles cannot under emphasize the special responsibility of intellectuals to shatter the conventional wisdom and myths of neoliberalism with its stunted definition of freedom and its depoliticized and dehistoricized definition of its own alleged universality. As the late Pierre Bourdieu argued, any viable politics that challenges neoliberalism must refigure the role of the state in limiting the excesses of capital and providing important social provisions. [15] At the same time, social movements must address the crucial issue of education as it develops throughout the cultural sphere because the “power of the dominant order is not just economic, but intellectual–lying in the realm of beliefs,” and it is precisely within the domain of ideas that a sense of utopian possibility can be restored to the public realm. [16] Most specifically, democracy necessitates forms of education that provide a new ethic of freedom and a reassertion of collective identity as central preoccupations of a vibrant democratic culture and society. Such a task, in part, suggests that intellectuals, artists, unions, and other progressive movements create teach-ins all over the country in order to name, critique, and connect the forces of market fundamentalism to the war at home and abroad, the shameful tax cuts for the rich, the dismantling of the welfare state, the attack on unions, the erosion of civil liberties, the incarceration of a generation of young black and brown men, the attack on public schools, and the growing militarization of public life. As Bush’s credibility crisis is growing, the time has come to link the matters of economics with the crisis of political culture, and to connect the latter to the crisis of democracy itself. We need a new language for politics, for analyzing where it can take place, and what it means to mobilize alliances of workers, intellectuals, academics, journalists, youth groups, and others to reclaim, as Cornel West has aptly put it, hope in dark times.

Henry A. Giroux is the Global Television Network Chair Professor at McMaster University in Canada. His most recent books include: Take Back Higher Education: Race, Youth, and the Crisis of Democracy in the Post-Civil Rights Era (Palgrave, 2004); Public Spaces, Private Lives: Democracy Beyond 9-11 (Rowman and Littlefield 2003); The Abandoned Generation: Democracy Beyond the Culture of Fear (Palgrave, 2003). He can be reached at: Visit his website at:


1. George Steinmetz, ‘The State of Emergency and the Revival of American Imperialism; Toward an Authoritarian Post-Fordism,” Public Culture 15:2 (Spring 2003), p. 337.

2. George Steinmetz, Ibid., ‘The State of Emergency and the Revival of American Imperialism; Toward an Authoritarian Post-Fordism,” p. 337.

3. Barry Bluestone and Bennett Harrison, The Deindustrialization of America: Plant Closings, Community Abandonment and the Dismantling of Basic Industry (New York: Basic Books, 1982), p. 6

4. Stanley Aronowitz, Ibid. How Class Works, p. 21.

5. Stanley Aronowitz, How Class Works (New Haven: Yale University Press, 2003), p. 101.

6. Stanley Aronowitz, “Introduction,” in Paulo Freire, Pedagogy of Freedom (Lanham: Rowman and Littlefield, 1998), p. 7

7.  Doug Henwood, After the New Economy (New York: The New Press, 2003); Kevin Phillips, Wealth and Democracy: A Political History of the American Rich (New York: Broadway, 2003); Paul Krugman, The Great Unraveling: Losing Our Way in the New Century (New York: W.W. Norton, 2003).

8. Stanley Aronowitz, How Class Works (New Haven: Yale University Press, 2003), p. 102.

9. Of course, there is widespread resistance to neoliberalism and its institutional enforcers such as the WTO and IMF  among many intellectuals, students, and global justice movements, but this resistance rarely gets aired in the dominant media and if it does it is often dismissed as irrelevant or tainted by Marxist ideology.

10. George Soros, “The US is Now in the Hands of a Group of Extremists,” The Guardian/UK (January 26, 2004).

11. Paul Tolme, “Criminalizing the Homeless,” In These Times (April 14, 2003), pp. 6-7.

12. Staff or Democracy Now, “Uncharitable Care: How Hospitals are Gouging and Even Arresting the Uninsured,” CommonDreams (January 8, 2004).

13.  John and Jean Comaroff, “Millennial Capitalism: First Thoughts on a Second Coming,” Public Culture 12:2 (2000), p. 332.

14. Comaroff, Ibid., (2000), p. 332.

15. Pierre Bourdieu, Acts of Resistance: Against the Tyranny of the Market (New York: The New Press, 1998).

16. Pierre Bourdieu and Gunter Grass, “The ‘Progressive’ Restoration: A Franco-German Dialogue,” New Left Review 14 (march-April, 2003), p. 66.

Other Articles by Henry A. Giroux

* George Bush’s Religious Crusade Against Democracy
* Higher Education is More Than a Corporate Logo
* Authoritarianism’s Footprint and the War Against Youth

Why Aren’t Children Included in the Debates About the Impending U.S. War with Iraq?