what is neoliberalism 
neoliberalism is a policy model that encompasses both politics and economics it favors private enterprise and seeks to transfer the control of economic factors from the government to the private sector many neoliberal policies concern the efficient functioning of free market capitalism and focus on limiting government spending government regulation and public ownership neoliberalism is often associated with the leadership of margaret thatcher the prime minister of the u k from 1979 to 1990 and ronald reagan the 40th president of the u s from 1981 to 1989 12more recently neoliberalism has been associated with austerity policies and attempts to cut government spending on social programs investopedia sydney saporitounderstanding neoliberalismneoliberalism is a political and economic philosophy that emphasizes free trade deregulation globalization and a reduction in government spending it s related to laissez faire economics a school of thought that prescribes minimal government interference in the economic issues of individuals and society laissez faire economics is the philosophy that minimal state interference and participation in the economy will maximize economic growth and prosperity additionally neoliberalism is sometimes confused with libertarianism however neoliberals typically advocate for more government intervention in the economy and society than libertarianism for example while neoliberals usually favor progressive taxation at low rates libertarians tend to advocate for a low flat tax or total elimination of income taxes the two often differ philosophically as well with libertarians focused on economic freedom and rights and neoliberals more focused on the free market economy as the way to the goal of more growth in addition neoliberals often do not oppose measures such as bailouts of major industries which are anathema to libertarians characteristics of neoliberalismneoliberalism involves the belief that greater economic freedom leads to greater economic and social progress for individuals it supports president jimmy carter s deregulation of the airline industry in 1978 is an example of a neoliberal policy in action the airline deregulation act removed government control over fares routes and who could enter the market 3liberalism vs neoliberalismat its core liberalism is a broad political philosophy it holds liberty to a high standard and defines all social economic and political aspects of society including the role of government neoliberalism is essentially an economic ideology the policies of neoliberalism are more narrowly focused and are primarily concerned with markets and the policies and measures that influence the economy criticism of neoliberalismthere are many criticisms of neoliberalism below are the most common ones one common criticism of neoliberalism is that advocating for a free market approach in areas such as health and education is misguided because these services are public services public services are not subject to the same profit motivation as other industries more importantly adopting a free market approach in health and education can lead to an increase in inequality and the underfunding of resources necessary for the long term well being and viability of an economy the adoption of neoliberal policies in the western world has run concurrently with a rise in inequality in both wealth and income while skilled workers may be in a position to command higher wages low skilled workers are more likely to see stagnant wages policies associated with neoliberalism are thought by some to encourage the presence of monopolies which increase the profits of corporations at the expense of benefits to consumers 4contrary to what proponents of neoliberalism typically claim capital deregulation has not necessarily helped economic development rather capital deregulation has led to an increase in financial instability including economic events that at times have sent shockwaves around the world in fact an international monetary fund imf report on neoliberalism reveals that an increase in capital flows has been a factor in the increased risk of adverse economic cycles 5studies suggest that neoliberal policies increase inequality this inequality can hinder the long term growth prospects of an economy on one end of the spectrum those who earn a low income have limited spending power at the same time those who become richer have a higher propensity to save 6in the latter scenario wealth doesn t trickle down in the way that proponents of neoliberalism claim that it will neoliberalism s emphasis on economic efficiency has encouraged globalization which opponents say causes factories to be closed and jobs to be moved overseas critics of neoliberalism claim that its call to replace government owned corporations with private ones can cause various forms of societal harm such as reducing access to essential services and harming workers rights in addition those opposed to neoliberalism claim that it is anti democratic and can lead to exploitation and social injustice they also claim it can lead to corporations using their power and resources to subvert the will of the majority of people others assert that it leads to support for undemocratic regimes that implement neoliberal economics 