A neoliberal on the front bench?

One of the recurring matters of interest for this blog has been that curious coinage “neoliberalism”. It was no surprise to find an item about it coming up in yesterday’s highlights reel. My view, expressed there and in other places, is that the term is almost always a hindrance rather than a help to intelligent debate.

Now here it is again, in a piece by Rachel Withers in Crikey on the appointment of Tim Wilson as shadow treasurer in Angus Taylor’s new front bench.* The tagline (which she may not have written herself, but which fits with the article) says that Wilson “represents the kind of neoliberalism the Liberal Party needs to move away from,” and later on she takes his appointment as a sign that “the opposition looks set to continue down its neoliberal path.”

That tagline might be a recognition that there are different kinds of neoliberalism, with Wilson representing the (or an) objectionable sort. But if neoliberalism involves any sort of loyalty to free markets – which other lines suggest, such as a reference to the party’s “commitment to an economic orthodoxy” – then it’s hard to defend the use of the word “continue”, since it’s been hostile to market-based policies at least since the advent of Scott Morrison in 2018.

And Withers seems to realise that. The sentence about the “neoliberal path” continues, “… more obsessed with protecting the powerful from nasty taxes than in any kind of fair and functioning market.” And she not only recognises that things like the privileging of capital gains are anti-market, but credits Wilson with the same knowledge: “he clearly understands this stuff in theory, whether or not he’s willing to apply it to the Treasury portfolio.”

But if that’s the case, then the term “neoliberalism” is doing nothing but spreading confusion. The same thought could be expressed by saying that the Liberals are committed to distorting markets in the interests of the old and rich, and that Wilson is likely to pursue the same course even though there’s enough in his record to suggest that he knows it’s wrong.

If you dip into the comments, however, you’ll find plenty of people who are certain that free-market policies benefit the rich, and who use the word “neoliberal” to put that view beyond question – to make it not an empirical claim but a conceptual necessity. As I put it some years ago, they lack “the conceptual equipment to distinguish between” free markets and crony capitalism.

At least there now seems to be a general agreement (as there hasn’t always been) that it’s economics that we’re arguing about; no-one much these days seems to use “neoliberal” as a term in social policy. And Withers in that regard takes a fairly traditional left view, with economics as the thing that defines political orientation. Hence the apparent (to her) paradox of Wilson and Jane Hume being “supposed ‘moderates’ who also happen to be aggressive free-marketeers.”

This I think is mistaken on two counts. Firstly in taking “moderate” to be an ideological term rather than a factional one, and secondly in taking such ideological content as it has to relate to economics. As I’ve been trying to explain for a long time, if you want to understand the Liberal Party you have to appreciate that factional divisions cut across, not with, the grain of divisions on economic policy.

And although Wilson has now been given an economic job, the issues that have divided him from the majority in his party room and put him on the losing side of last week’s leadership battle are not economic ones. His problem, from the party’s point of view, is that he believes in the reality of climate science, doesn’t support a racist immigration policy and if left to his own devices would probably direct preferences against One Nation.

Wilson very narrowly won his seat of Goldstein back from the Teals last year by ignoring Liberal head office and running a grassroots campaign focusing on cost-of-living questions and ignoring the culture war issues that his leader, Peter Dutton, was obsessed with. (Although he may also have benefited from a campaign by the far right to smear his opponent as antisemitic.) Whatever his personal views, he must know that knifing a female leader and replacing her with a rural right-winger is not a good omen for his electoral survival, in what is now the party’s only inner metropolitan seat.

Taking a high-profile position and trying to turn the debate as much as possible to economic matters are strategies to try to overcome that problem, for himself and potentially for other candidates as well. But it’s going to be an uphill task.

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* I should mention that although neither is a close friend, I know both Withers and Wilson reasonably well. Whether or not they know each other I don’t know.