By the end of the 1980s at the latest, neoliberalism had become the pensée unique of both the centre left and the centre right. The old political controversies were regarded as obsolete. Attention now focused on the ‘reforms’ needed to increase national ‘competitiveness’, and these reforms were everywhere the same. They included more flexible labour markets, improved ‘incentives’ (positive at the upper end of the income distribution and negative at the bottom end), privatization and marketization both as weapons in the competition for location and cost reduction, and as a test of moral endurance. Distributional conflict was replaced by a technocratic search for the economically necessary and uniquely possible; institutions, policies and ways of life were all to be adapted to this end. It follows that all this was accompanied by the attrition of political parties—their retreat into the machinery of the state as ‘cartel parties’ [4] —with falling membership and declining electoral participation, disproportionately so at the lower end of the social scale. Beginning in the 1980s this was accompanied by a meltdown of trade-union organization, together with a dramatic decline in strike activity worldwide—altogether, in other words, a demobilization along the broadest possible front of the entire post-war machinery of democratic participation and redistribution. It all took place slowly, but at an increasing pace and developing with growing confidence into the normal state of affairs.
As a process of institutional and political regression the neoliberal revolution inaugurated a new age of post-factual politics. [5] This had become necessary because neoliberal globalization was far from actually delivering the prosperity for all that it had promised. [6] The inflation of the 1970s and the unemployment that accompanied its harsh elimination were followed by a rise in government debt in the 1980s and the restoration of public finances by ‘reforms’ of the welfare state in the 1990s. These in turn were followed, as compensation, by opening up generous opportunities for private households to access credit and get indebted. Simultaneously, growth rates declined, although or because inequality and aggregate debt kept increasing. Instead of trickle-down there was the most vulgar sort of trickle-up: growing income inequality between individuals, families, regions and, in the Eurozone, nations.
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