Bernard Keane of Crikey can perhaps be forgiven for this error given other much more honed economic minds are making the same mistake:
When historians look back at the possibly very brief prime ministership of Liz Truss, who seems unlikely to make it to the end of the week, they’ll try to understand it in terms of the weird decline of the Tory Party and its complex relationship with neoliberal economic thinking.
That’s not to suggest some recognition shouldn’t be given to the spectacular political flaws of Truss and Kwasi Kwarteng — remember him? — summoned back from Washington on Friday to be offered as a sacrifice to save his prime minister.
But Truss’ determination to pursue a classic program of neoliberalism — tax cuts for the rich, a halt to plans to increase corporate tax, both now ditched — was wrecked with overwhelming force by the gods of neoliberalism: the markets.
Wrong. Truss is not neoliberal which is why markets hate what she did.
Tax cuts can be neoliberal but not when they are deployed amid huge twin deficits and an inflation scare.
That is some weird mix of libertarian policymaking and corruption: an open and relentless hostility to all forms of government regardless of timing and circumstance, wedded to oligarchic funding.
Neoliberalism is encapsulated in three public policy principles:
- public surpluses
- deregulation
- economic opening to trade and investment flows.
Neoliberal markets have just demarcated these principles against Liz Truss’s crony libertarianism.
