SOC1000 L5 Capitalism and the Free Market
SOC1000 L5 Capitalism and the Free Market
Key Concepts
Power
Surveillance
Discipline
Overview of Prior Concepts
Weber & Verstehen: To understand society, we must grasp people's personal viewpoints.
This includes the idea that individuals are rational and make their own choices.
Rationalisation: Applying 'reason' to society, which raises questions about whether some ideas, like 'efficiency', are truly fair to everyone.
Epistemes: Social and economic systems that shape what we know and how we act.
Current Focus
Looking at how 'freedom', especially in liberal ideas, is connected to power, and how the idea of freedom can hide power differences.
A quick look at economic history, including Neoliberalism, which is a way of thinking about how society and the economy should be run.
Understanding power not just as something that stops us, but also something that helps create things, especially in relation to freedom.
Neoliberal 'flexibility', like with Deliveroo jobs, makes us ask who really benefits from this kind of freedom.
Definition of Capitalism
Capitalism is a system where:
Conditions allow for wealth to grow.
Goods are made to be sold, not just for personal use.
Money is used for buying and selling.
Property is privately owned.
People work for wages.
This system encourages making more money and investing it to make even more.
The government helps by making sure money is stable and protecting private property and agreements.
Capitalism is more than just economics; it organizes society, politics, and the economy, shaping how people live.
It creates values that promote careers, success, and survival.
It also brings up questions about who gets the wealth, as wealth leads to political power.
Colonialism is seen as a way to gather wealth in a global capitalist system, helping lead to globalization.
Brief Economic History
Forms of Capitalist Control:
Mercantilism (16th–18th Century): Governments tightly controlled the economy to grow the state's and empire's power. They used strict rules and protectionist policies to keep monopolies.
Laissez-Faire (18th–20th Century): Idea of a free market emerged. Supporters said free trade helps everyone, not just empires. A new group of people challenged kings and nobles.
They believed in a 'natural' economy guided by people's rational actions (the 'invisible hand'). They wanted minimal government involvement.
However, inequality remained, and colonial monopolies went against free-market ideas.
Keynesianism (1920s–1980s): Government-regulated capitalism aimed to balance the power of businesses and workers. Economic growth was managed by the government controlling supply and demand.
Multiplier effect: Government jobs led to more demand for goods and services.
Social welfare programs (like NHS) were set up to fix market problems.
Economic equality improved until a global recession in the 1970s.
Neoliberalism (1980s Onward): A return to free-market ideas, pushing for very little government involvement in the economy.
Neoliberal Theory
Builds on Laissez Faire ideas:
Focuses on individuals as 'self-governing and decision-making' (Springer et al., 2016).
Power is seen as forceful, where government rules stop people from acting in their own best interest.
Markets work on their own ('invisible hand'); individuals acting selfishly lead to a balanced market and economic growth.
Neoliberalism goes beyond just economics, seeing free markets as a moral guide for all parts of society and politics.
Market as a Political System: Compares market choices to voting, where individual choices show what people prefer (Friedman & Friedman, 2009).
Unlike laissez-faire, it mixes economic and political control, using market logic to structure society.
Neoliberalization Process
How Neoliberalization Happens:
Changes that reduce government power while spreading free-market ideas throughout society.
Encourages growth and flexibility, allowing businesses to adapt.
Liberalization means reducing local government support and funding (austerity).
Encouraging foreign businesses to invest.
Privatization: Applying market principles to areas like education, health, government, and energy.
Turning public services into competitive market players.
Outcomes of Neoliberalization
Has led to slow economic growth, many banking crises, and recessions since the 1980s.
Inequality is higher than even in the Victorian era.
The middle class is struggling, and issues like food poverty and debt are rising.
The idea of 'freedom' often hides who truly holds power and what their real interests are.
As David Harvey (2005) noted, “Thirty [now 45+] years of neoliberal freedoms have produced immense concentrations of corporate power.”
Power and Capitalism
Liberal 'freedom' hides the economic and political power that can change markets.
This is clear in the ties between politicians (like Trump) and business leaders (like Elon Musk) with the government.
Similar to past groups like the East India Company, which had government-given monopolies.
Questions arise about personal freedom in getting basic needs like housing, especially when market forces favor those with money.
The market isn't truly 'free'; it's shaped by power relationships.
Socially Constructed Market
The market is a human creation that wrongly appears to be free of power.
Views that criticize the market often ignore the ways it is shaped by rules and systems (like currency regulation, financial laws).
The point isn't to remove power, but to understand its different forms and how it affects people and society.
Review Questions
Questions to think about neoliberalism, privatization, why people oppose social welfare, and how power and choice are seen under neoliberal rules.
Freedom and Power: A Thought Experiment
A scenario about robbery and force shows different ways to understand power.
Foucault’s Concept of Power: Power isn't just about forcing people; it's also deeply connected to individual freedom and choices.
Power shapes what we want, what we choose, and what we think is possible.
This raises questions about how much choice we truly have in areas like wage work and life decisions.
Foucault's Perspective on Power
Looks at how knowledge affects power and how we define our choices and ourselves.
Suggests that ideas of what's normal and acceptable come from society.
Critiques how liberal ideas of freedom hide underlying power structures.
Power Dynamics
Redefines power as an interaction linked to our ability to act.
Explores how power relates to our actions, free choice, and how it influences our interactions.
Notes that judging power as moral or immoral is a personal view.
Surveillance and Discipline
Foucault identified different ways power works: through language/ideas, surveillance, and discipline.
Panopticon Model: A type of prison design where guards can always watch prisoners, leading people to control themselves.
Changes in Power's Function: Power shifted from punishing people to setting norms that make people obedient and productive.
Discusses how surveillance and discipline have evolved and what they mean today.
Practical Implications of Surveillance and Discipline
Shows how surveillance becomes part of daily life, making individuals follow norms by constantly checking themselves.
Looks at how this works in education and social media, where people often judge themselves against what society expects.
Case Study: Employment Practices
Discusses zero-hour contracts and how 'self-employment' is seen in a neoliberal economy.
Highlights how government actions allow for unfair work practices and change job security.
Questions what 'freedom' really means for people facing more market competition and uncertainty.
Summary of Themes
Neoliberalism is a major economic idea that focuses on freedom and market rules.
Our understanding of power has changed from just being forceful to also recognizing its subtle ways of shaping individuals and society.
Concepts like surveillance and discipline show how power becomes internalized and how society creates norms.
It's not about removing government influence, but recognizing that neoliberal policies often support certain government actions that benefit businesses at the expense of stable jobs.