Ever since Milton Friedman, American economist (1912-2006), who considered himself the heir to Adam Smith, used the term neoliberalism in an essay “Neoliberalism and its Prospects” in 1951, the world has tilted in that direction, starting with Chile as the “Chicago Boys” lab experiment under the watchful eye of the infamous dictator General Augusto José Ramón Pinochet Ugarte, president from 1974-90. The world has never been the same.
Today, neoliberalism reigns supreme across the oceans, whereby control of economic principles shifts from the public sector to the private sector with limited governmental interference, the less the better, open markets, free trade for all and deregulation piled upon deregulation as well as austerity for the masses (look at Greece and Spain for major pushback movements, happening today).
With neoliberalism, the market pretty much determines everything. When looked at from another angle, the world becomes a gigantic commoditized sphere spinning around the solar system, as markets set prices for everything, except for the biosphere, a very big “except for,” indeed.
Does it make sense to set prices for everything, except for the biosphere? Since everything, from wheat to space travel, is market-driven, why not the atmosphere, why not oceans, why not soil? Why leave the biosphere out of the realm of the market?
After all, since survival of the fittest is as old as nature, and since neoliberalism, in practice, dictates ‘survival of the fittest economics’ it mirrors nature’s behavior, although, as it happens in real life, neoliberalism is bottom-feeder economics whereby the rich accumulate more and more and more at the expense of lower and lower and lower wages, less benefits, and crushed self-esteem. What could be worse?
There is a better way, a sharper focus found within eco economics, which ties the whole picture together, the externalities outside of markets as well as everything inside markets, thus, integrating important externalities into the market system, e.g., biophysical limits….On natural capitalism.
Natural capital is defined by Sir John Richard Hicks, British economist, 1904-1989, Hicksian natural capital, bringing forth Hicksian natural income, which is the level of consumption that can be sustained from one period to another period without reducing natural wealth, which is key to successful eco economics. [Yes, that John Hicks]Humanity's "natural capital" is the environment as a commons. Neoliberalism draws on natural capital inefficiently through externalities that distort true cost and, therefore, the vaunted price mechanism of the market, to make life poorer for all not only by privatizing gains and socializing losses but also through ecological degradation the actual cost of which is diminished quality of life. while this cost can be estimated monetarily though factors like health costs, life is priceless and cannot be valued monetarily.
The solution lies in converting from an ownership society and economy to a stewardship society and economy.
Far from preventing "the tragedy of the commons" as Garrett Harkin theorized, privatization is leading to not only a tragedy of the commons as the ecological system but also a catastrophe for humanity as its life-support system collapses.
Counterpunch
Eco Economics Takes on Neoliberalism
Kevin Carson
[Walter Block] starts out by defending gentrification as a simple manifestation of autonomous market preferences, of course. The gentrifier does, he admits, drive existing residents — sometimes third or fourth-generation residents — out of their homes. They are forced to retreat to “less preferred real estate. We know this since if they liked their new domiciles more than their previous ones, they would have already moved there, without any pressure being placed on the market by the new gentry.” And the homes they’re driven from “are part of neighborhoods, communities, associations. They have a history there. Their children are wrenched away from their friends.”
But, says Block, so what? Gentrifiers do all these awful things entirely by trying to rent or purchase real estate in a neighborhood, “thus bidding up rents and sales prices higher than would otherwise exist.”
Is this unfair? he asks. “Certainly not. Assume that the rich came by their wealth in an honest way, not through government grants of special privileges, subsidies, bail-outs, a la crony capitalism, but via laissez faire capitalism.” Having thus assumed away the entire real world of privilege enjoyed by actually existing rich people, and the fact that local governments are nothing but showcase properties of the local real estate interests, Block goes on to argue that anything short of inequality and merciless gentrification would be grossly unfair to the rich, because they “have contributed more to everyone else than the poor.”"Just deserts."
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