Neo-liberalism – the term used by many critics to encompass the new right – was based on the twin pillars of neo-classical economics (unrestrained free-market
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Cohen, Lizabeth 2004 The Consumers’ republic: the politics of mass consumption in postwar America, New York, quoted in Kroen (2004), p. 709.
capitalism) and libertarian philosophy, in which the objective of society and government is ‘to promote as much individual freedom as is feasible and to allow individuals to determine their own goals’, tracing a direct line back to Locke and (with some convenient oversights) Smith (Hamilton 2008, p. 7; Lowe 2005). Under neo- liberalism, individualism – the pursuit of self-interest – is elevated and collectivism abjured; the individual’s ‘freedom to consume’ is sacrosanct (Princen, Maniates & Conca 2002a; Hamilton 2003) and politics, ironically given the belief in freedom of the market from government control, becomes ever-more entwined with economics.
As governments progressively removed obstacles to the global spread of financial markets and corporate capital, in the process spreading the ideology of the free market (Hamilton 2003), consumers in the West became inextricably tied into globalisation. Even after the passing of the governments overtly founded in the 1970s–80s on neo-liberal philosophy, it has persisted through a kind of
homogenisation of politics in which, while there may be differences in social policy, all major parties are agreed on the primacy of economic growth, while neglecting the kinds of policies that once gave capitalism a more human face (Princen, Maniates & Conca 2002a; Hamilton 2003, 2007; McKnight 2005; Helm 2009; Pearse 2010).
A consideration of economic principles and their relationship to policy helps explain this ‘growth fetish’ (Hamilton 2003). Modern capitalism relies on economic growth, and consumption is the key to economic growth: if consumption slows, profits decline, employment falls and there is even less consumption, resulting in recession or even depression (Douthwaite 1999; Jackson 2009). In free market economies there is continuous pressure to increase production and productivity: since 1800 labour productivity has increased twenty-fold, incomes ten-fold, while there is an ever- increasing range of goods and services that can be purchased (Michaelis 2006; Hamilton 2003; de Geus 2004); and consumption of luxury goods and household items has soared (Monbiot 2006; Hamilton and Denniss 2005).
Classical economic theory is based on the neutrality of consumer preferences – their rational choice – and production is then geared to what consumers have shown they want (Luke 1999; Princen, Maniates & Conca 2002a; Hamilton 2003; Hamilton & Denniss 2005). This is known as ‘consumer sovereignty’, and is regarded as one of the two primary forces behind modern politics and economics: the other is the belief that through economic growth the whole population benefits (often called the trickle- down effect), which ‘carries a much lower political price tag’ than redistribution of wealth (Princen, Maniates & Conca 2002a, p. 5). Each year citizens of modern Western countries are encouraged by politicians and the media to expect to have greater
disposable income and a better physical quality of life than the year before (Michaelis 2006), thus feeding economic growth. ‘Consumerism works in concert with
neoliberalism, instructing citizens that they can reinvent themselves continually through the process of consumption’ (Jubas 2007, p. 232).
These processes ensure that individual consumption is beyond scrutiny, with the result that policy choices are limited to regulating production processes.
Consumer choices, however, are part of ‘a stream of [hidden] choices and decisions embedded in social relations of power and authority’ (Princen, Maniates & Conca 2002a, p. 11-12). The doctrine of consumer sovereignty depoliticises struggles over resources and equality, as consumer choice is presented as broadening choice for all citizens (Jubas 2007; Luke 1999), and ignores the power of advertising and the many more subtle forces driving consumer behaviour (Hamilton 2003). As consumer sovereignty has advanced, however, in many ways the range of choices available has declined: the use of the private car has become ubiquitous and expected, for example, while those reliant on, or choosing to use, public transport, are left with poorer services and even social exclusion (Maniates 2002b; Manno 2002; Michaelis 2004). The removal of public telephone boxes with the rapid advance, relentless upgrading and promotion of mobile phones is another example of lost choice. While choice is supposedly democratising, the lack of choice for the poor persists, only exacerbating inequality (Jubas 2007).
Despite these problems, governments, reinforced by the media, are wedded to consumer sovereignty and keenly monitor ‘consumer confidence’, regarded as a key indicator of economic growth.
Economic forecasts are based on increasing demands: unless people buy more houses, more cars, more sporting equipment and clothes, the economy will falter. … To refrain from consuming is antisocial; it is seen as a threat to the community (Csikszentmihalyi 2004).
Nor is the production-oriented approach limited to mainstream economists and politicians: much of the environment movement has adopted the approach that regulation of producers is the answer to pollution and other environmental problems, as discussed in sections 3.4.1 and 3.5.3.
The easy availability of consumer credit in recent decades greatly stimulated consumption (Douthwaite 1999; Michaelis 2006), at least until the GFC struck in 2008. Ironically, that same easy credit was a major cause of the GFC (Peattie & Collins 2009), but, as Jackson (2009), points out ‘[if] there was irresponsibility it was systematic,
sanctioned widely and with one clear aim in mind: the continuation and protection of economic growth’ (p. 7). Unfortunately – because the environmental and social implications of rampantly growing production and consumption are clear – governments turned to the only means they knew to avert economic crisis: to stimulate growth and consumption, to recommit themselves to the growth fetish (Jackson 2009; Peattie & Collins 2009; Helm 2009), dispensing large amounts of public money to bolster consumption (Peattie & Collins 2009; Garnaut 2011a; Pearse 2010).