Beyond the Market vs. State Dichotomy: Reclaiming Collective Power in the Age of Neoliberalism

The neoliberal shift wasn’t about shrinking the state, but about crushing collective power. This essay explores this shift and its consequences, culminating in a call for collective empowerment. The state’s role didn’t diminish; it was repurposed.

Under the banner of “free markets,” politicians like Margaret Thatcher in the UK and Ronald Reagan in the US championed policies that fundamentally reshaped the relationship between the state, capital, and labour. Thatcher’s privatisation of British Telecom and British Airways, and the Reagan administration’s deregulation of the financial industry, exemplified this shift. International organisations like the International Monetary Fund (IMF) and the World Bank played a crucial role in promoting these policies globally, often imposing them as conditions for loans to developing countries, leading to what some critics call “neoliberal globalisation.” The physical assertion of state power, like the violent policing of protests against austerity measures, such as the 2010 UK student protests, or environmental destruction, was accompanied by an ideological shift. Individuals were no longer seen primarily as workers or citizens, but as consumers, entrepreneurs of the self. This toxic individualism has eroded the collective consciousness that once supported social safety nets and public services. This erosion wasn’t accidental; it was a deliberate strategy to dismantle the power of organised labour and atomise society. The state actively intervened to weaken unions, such as the UK government’s response to the 1984-85 miners’ strike.

The expansion of credit, the push for individual retirement accounts instead of robust state pensions, as seen in the partial privatisation of Social Security in some countries, and the emphasis on homeownership created a society of individual risk-bearers, each responsible for managing their own financial well-being. This fostered a culture of competitive individualism, where success and failure were attributed solely to personal merit or failings, obscuring systemic inequalities. If you can’t afford rent today, you blame yourself, not the system that allows housing to be treated as a commodity rather than a right, or the deregulation of the financial sector that led to the 2008 housing crisis. This internalisation of blame is a direct consequence of the dismantling of collective structures like trade unions, which once provided a channel for collective action and resistance.

This toxic individualism has not only damaged mental health, with rising rates of anxiety and depression often linked to precarious work and economic insecurity, but also hampered our ability to address collective challenges like climate change. The emphasis on individual responsibility – “reduce your plastic consumption” – distracts from the systemic changes needed to regulate polluting industries and transition to a sustainable economy. Corporations like ExxonMobil, for instance, have been accused of downplaying the risks of climate change for decades while lobbying against effective climate policies. The focus on individual consumption as a form of self-expression has fuelled a culture of consumerism, driving unsustainable levels of resource depletion and environmental degradation.

The consequences of this neoliberal shift are profound. This isn’t about state versus market; it’s about who holds power. It is often argued that the neoliberal focus on market mechanisms has led to increased economic growth. However, this growth has often been accompanied by a widening wealth gap, with the benefits disproportionately accruing to the wealthy. Moreover, this period has seen increased financial instability, culminating in events like the 2008 financial crisis, triggered by the very deregulation that was supposed to enhance market efficiency. Neoliberal policies are often defended on the grounds that they enhance individual freedom. While it is true that deregulation and privatisation can lead to greater consumer choice in some areas, this “freedom” is often limited by one’s economic standing. The close relationship between governments and large corporations, often exercised with little public scrutiny or accountability, has created a system where corporations wield significant influence over policy decisions. Companies like Amazon, for example, have been criticised for their aggressive lobbying efforts to shape regulations in their favour, often at the expense of workers’ rights and fair competition. This has created a system where the vast majority of people have little control over their lives. This feeling of powerlessness is a key feature of the system, designed to stifle any imagination of alternative possibilities.

Therefore, we need a call to action. We must reclaim the idea of collective power. This means rebuilding and strengthening collective institutions, and moving beyond blaming ourselves and start organising collectively to demand systemic change. This involves:

• Rebuilding Collective Power: Supporting and joining trade unions fighting for better wages and working conditions, such as the recent resurgence of union activity in the US and the UK, exemplified by successful campaigns at companies like Starbucks and Amazon. Tenants’ unions advocating for affordable housing, like those fighting rent increases and evictions in cities around the world, and community organisations working on local issues.
• Challenging Individualism: Rejecting the narrative that our problems are solely individual failures and recognising the systemic roots of inequality, such as the concentration of wealth in the hands of a few, a trend exacerbated by policies like the 2017 Tax Cuts and Jobs Act in the US, which disproportionately benefited corporations and wealthy individuals.
• Demanding Systemic Change: Pushing for policies that prioritise collective well-being over individual profit, such as public ownership of essential services like energy and transportation. We can learn from examples like that of Preston, UK. There, the council implemented a model of “community wealth building”. This model includes using procurement to support local businesses and cooperatives, and promoting the real living wage. Progressive taxation to redistribute wealth, and investment in public goods like education and healthcare.
• Promoting Alternative Visions: Actively imagining and articulating alternative economic and social models that prioritise social and environmental justice. Worker cooperatives, like the Mondragon Corporation in Spain, demonstrate the viability of democratic workplaces. Community land trusts offer a model for permanently affordable housing. Participatory budgeting initiatives, like those pioneered in Porto Alegre, Brazil, empower citizens to directly decide how public funds are spent. We can also advocate for policies that support these models, such as legislation promoting employee ownership, public banking initiatives to provide affordable credit to cooperatives and community-based enterprises, and regulations that favour sustainable and ethical businesses.

The only way to achieve a fair and just society is when people take power – in their workplaces, in their communities, and over political life as a whole. We must move beyond the sterile debate between more market and less government and focus on building a society where collective empowerment and democratic control are at the heart of our economic and political systems. This is not a project of protection, but a project of collective empowerment, a project that is urgently needed to address the multiple crises we face today. This is a project exemplified by the growing global movement for climate justice, which recognises the interconnectedness of social and environmental issues and demands systemic change to address the root causes of the climate crisis.