From Depoliticisation to Dedemocratisation: Revisiting the Neoliberal Turn in Macroeconomics

Stahl, Rune Møller

doi:10.1080/13563467.2020.1788525

Cited by 19 publications

(11 citation statements)

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“…Neo-liberal scholarship was an important spur to the 1970s revival of rules-based economic governance. Stahl characterises neo-liberalism as ‘de-democratisation’ ( 2020 ), insulating economic policy from democratic and societal pressures (see also Slobodian 2018 ). The effects of mass, pluralist, parliamentary politics were considered too destabilising, posing a threat to the market and the economy.…”

Section: Theorising Rules-based Economic Governancementioning

confidence: 99%

Technocratic economic governance and the politics of UK fiscal rules

Clift

2022

Br Polit

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This exploration of UK fiscal rules and the establishment of an independent UK fiscal watchdog focuses on the practical enactment of rules-based fiscal policy to analyse the politics of technocratic economic governance. Analysing UK macroeconomic policy rules and their operation unearths numerous dimensions of the politics of technocratic fiscal policy-making. Firstly, policy rules are marshalled for partisan purposes. Secondly, a politics of economic ideas surrounds the invention, revision and interpretation of fiscal rules. Thirdly, technocratic economic governance entails a ‘politics of method’, selecting methodological approaches necessarily built on particular political economic assumptions. Finally, a ‘politics of numbers’ sees politicians cooking the books to present their economic record favourably against fiscal yardsticks. Successive governments have altered UK fiscal rules, informed by different political economic principles. The Office for Budget Responsibility (OBR) sees itself as a technocratic and apolitical institution, yet its operational work entails contrasting accounts of the economy and policy. The scale of discretion and judgement inherent in operating fiscal rules is under-appreciated. This article finds technocratic economic governance to be a much more social and political process than many advocates of economic rules-based policy acknowledge. It engenders new forms of distinctive fiscal politics within elite statecraft and expert technocracy.

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Section: Theorising Rules-based Economic Governancementioning

confidence: 99%

Technocratic economic governance and the politics of UK fiscal rules

Clift

2022

Br Polit

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“…When this system came apart in the 1970s, with slowing economic growth, declining profitability, and increasing unemployment going hand-in-hand with rising inflation, central bankers, neoliberal ideologues, finance capital, and various policy entrepreneurs agitated for a more restrictive framework for monetary policy, namely, the control of inflation, and argued that this task should be entrusted to independent central banks that could protect money from the inflationary effects of mass democracy (Blyth, 2002;King, 2005;Roberts, 2010;Stahl, 2021a).…”

Section: 1: Central Bank Independence In Theorymentioning

confidence: 99%

“…However, the argument for CBI also has clear neoliberal underpinnings, rooted not just in a desire to depoliticize money, but to purposefully dedemocratize it (Stahl, 2021a). The great neoliberal thinker and ideologue Friedrich Hayek, who in the 1970s was energetically trying to solve the problem of the Great Inflation, agitated strongly for the privatization of money creation and thus the destruction of democratic money (Eich, 2019).…”

Section: 1: Central Bank Independence In Theorymentioning

confidence: 99%

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Technocracy Ascendant: Central Banking and Ideology after 2008

Foster¹

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<p>Adopting a Gramscian view of the current era as one of organic crisis and intellectual and ideological disorientation among the ruling classes, this thesis explores the changing forms and ideological dimensions of technocratic economic governance following the Great Financial Crisis (GFC) of 2007–2009 and into the Covid-19 era. I focus on the major central banks of the capitalist core and pursue two main lines of investigation: (1) theorizing the evolving role and expanding power of central banks within the post-GFC context of organic crisis; and (2) providing case studies of intellectual and ideological disorientation and attempted reorientation in central banking. The thesis introduction lays out my research problematic and my theoretical and conceptual framework. Chapter 1 critically examines the institutional character and strategic orientations of today’s formally independent central banks, building a nuanced reading of these organizations as public–private governors that operate as power centres of finance capital. Chapter 2 considers the political-economic terrain in which these power centres of finance capital have intervened since 2007, providing a comparative review of the literature on the proximate and structural causes of the GFC, the related Eurozone Crisis of 2009–2015, and the Covid-19-induced financial panic of March/April 2020. Focusing on the Federal Reserve System (Fed) and the European Central Bank (ECB) as illustrative case studies, chapter 3 traces out the development and implementation of novel forms of emergency liquidity support over this crisis period. Here, I delineate the rise of the ‘derisking’ (Gabor 2020) central bank and argue that it is a core component of ‘authoritarian neoliberalism’ as a form of governance. Chapters 4 and 5 turn to examine how central bankers have responded to the repoliticization of ‘the economy’ and its management in the decade following the GFC. I develop an original conception of central bankers as organic intellectuals of finance capital—technical specialists and political operatives who produce authoritative interpretations of how monetary and financial systems work and how they should be managed. Chapter 4 examines a large body of speeches from high-ranking officials at the Fed and the ECB from 2009–2020. Focusing on how they frame and seek to make sense of the repoliticization of the economy and their place in it, I delineate and critically interrogate three core ideological narratives: (1) a climate of fear, (2) authoritarian neoliberalism, and (3) stakeholder capitalism. Chapter 5 extends this analysis by critically examining the intellectual reorientation of the Bank for International Settlements (BIS) following the GFC. I trace out the unique economic imaginary of what I call Global Balance-Sheet Capitalism that has developed at the BIS over this period and critically examine how the bank has sought to deploy this imaginary in defence of financial globalization as a political project. A short concluding chapter considers some of the implications of this research for contemporary socialist politics.</p>

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“…The work was commissioned by central banks stemming from the reasoning that revealing the risk level will incentivize the financial system to accommodate accordingly, when the urgency of climate change calls for much more drastic measures Tarim, 2022). In short, the perfect tool for depoliticizing the discussion around climaterelated issues (Stahl, 2021). Instead of acknowledging the fact that the economy is embedded in the environment which calls for an entirely new approach to modelling, which embraces complexity and the use of non-equilibrium models , the work with models and scenario analysis has become subject to a simplification of reality, because this is the reasoning behind economists' way of modeling.…”

Section: New Uncertainties New Modeling Approaches?mentioning

confidence: 99%

Managing Climate Change Like a Central Banker: The Political Economy of Greening the Monetary Technocracy

Quorning¹

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It is becoming increasingly clear that if we want to live up to the Paris Agreement and meet the 1.5°C commitment, our societies and economies need to undergo systemic changes at an unprecedented scale. All sectors in the economy will be affected and climate change will therefore likely impact financial and price stability. This realization has led central banks to engage with climate-related issues, leaving central bankers in an unprecedented situation: working with a policy domain outside their immediate knowledge remits. Climate change has become a mainstream issue in central banks, and it is against this background that I seek to understand how central bankers have approached the work with climate change and the extent to which central banks have been repurposed as they have set out to deal with the greatest challenge of our time: the climate crisis. The dissertation draws on insights from International Political Economy, where the dominant approach has been to view central banking from institutional, structural, or ideational perspectives. Here I utilize a micro-level analytical approach constructed around three factors: practices, expertise, and legibility. To understand how central bankers have worked with climate change, I examine the practices they have incorporated, with a focus on climate stress testing and modeling of climate-related risks. I also discuss the types of expertise deployed as I seek to understand how central bankers, trained mainly as economists, work in an entirely new policy domain such as climate change. Finally, I set out to analyze how central bankers have made climate change legible by turning climate change into a risk issue; for central bankers, climate change becomes a risk-based issue, similar to other routine economic problems. I argue central bankers have approached climate change like any other task. In treating climate change as a risk issue, central bankers have been able to work with climate change using their existing expertise and adapting their modeling frameworks to deal with climate-related risks, like any other financial risk. Thus, even though climate change represents a new policy domain, central bankers have maintained the status quo, and subsumed climate change under their current modus operandi. The necessary fundamental changes to the conduct of central banking in the age of anthropogenic climate change remain absent. Despite the urgency of the climate crisis, it is business as usual for the central banks.

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From Depoliticisation to Dedemocratisation: Revisiting the Neoliberal Turn in Macroeconomics

Cited by 19 publications

References 49 publications

Technocratic economic governance and the politics of UK fiscal rules

Technocratic economic governance and the politics of UK fiscal rules

Technocracy Ascendant: Central Banking and Ideology after 2008

Managing Climate Change Like a Central Banker: The Political Economy of Greening the Monetary Technocracy

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