The Quiet Coup: Neoliberalism and the Looting of America by Mehrsa Baradaran • W.W. Norton • 2024 • 464 pages • $32.50
“Neoliberalism” is a conceptual octopus. At times, no sphere of intellectual inquiry seems safe from its analytic tentacles. Contemporary regulatory policy, political ideology, family life, consumer culture, even dating apps – all, apparently, bear its imprint. While the potential downsides of so sprawling an application of the term have been noted for years, as a subject, neoliberalism continues to thrive on a steady diet of scholarship, commentary, and invective. In The Quiet Coup: Neoliberalism and the Looting of America, Mehrsa Baradaran is the latest to anatomize the neoliberal octopus. Baradaran, the author of pathbreaking books on systemic inequality in the United States’ banking system, limns a bleak history of modern American politics. Since the 1960s, she argues, American law and public policy has been reshaped around corporate interests – a transformation that has rippled out into U.S. society and culture.
Appropriately for a book published in the wake of the COVID-19 pandemic, The Quiet Coup comes liberally garnished with language of contagion: neoliberalism has “infected” American politics, the spread of its policy precepts has been “viral.” More than merely an ideology, it is “a cancer of corruption.” And in Baradaran’s diagnosis, inequality was not merely a side-effect, but part of the disease itself: “inherently unfair” socioeconomic outcomes are the point. This inequality proved the perfect laboratory in which to incubate Trump-era rightwing populism, with its social and economic alienation, nativism, conspiracy theories, and political violence. Like others on the Left, the “post-liberal” Right, and even from within liberalism, Baradaran argues that neoliberal policies called forth the populist backlash that has scrambled American politics over the past decade.
Baradaran contends, however, that she offers a “revisionist” interpretation of the “neoliberal era.” Though neoliberalism is often associated with the “free market,” Baradaran instead argues that it “did not simply untether markets – it reshaped them in a particular way.” A public philosophy, famously popularized by Nobel laureate Milton Friedman, that presented markets in almost mystical terms and equated deregulation with liberty and freedom disguised a political project which used law and public policy to create favorable conditions for corporate interests, especially those of finance capitalism. “[R]ather than seek to eradicate the state,” Baradaran writes, neoliberals “worked to influence its regulatory apparatus to produce corporate profits at the expense of the people.” Contra left-wing critics who claim inequality and financialization are inevitable in a market economy – cue the rhetoric about “late capitalism” – Baradaran argues instead that the neoliberal order has distorted competitive markets. (In this, her critique aligns more with Elizabeth Warren than David Harvey or Grace Blakeley).
Baradaran posits that, as encoded in U.S. jurisprudence after the 1960s, neoliberalism made it easier for corporations to influence the political process through a dramatic expansion of First Amendment protections to corporations and concomitant reform of campaign finance rules. Public policy innovations also enabled corporate agglomeration and financialization through light-touch antitrust enforcement, financial deregulation, and trade agreements which propitiated the offshoring of productive industries. Certainly, all of this required not the “freeing” of “the market,” but instead the political construction of a sanguine climate for financial interests.
While the scope of Baradaran’s account is far more ambitious than most, the idea that neoliberalism entailed not the retreat but the reconfiguration of the state is in fact a defining feature of recent scholarship. Even a popular recent account that nominally adopts the “free market” interpretation, Gary Gerstle’s The Rise and Fall of the Neoliberal Order (2022), inadvertently reveals how state power was required both to construct the titular “neoliberal order” and to step in at times of crisis to keep capital flows lubricated, as in 2007-08. International neoliberalism, instantiated in the “Washington Consensus,” required political and legal enforcement.
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Baradaran’s second claim to revisionism is that The Quiet Coup takes the conversation about neoliberalism “away from the realm of economics and instead focuses on the law.” In addition to banking law, The Quiet Coup includes richly detailed chapters on the corporate-friendly evolution of affirmative action law and on the “legal revolutions” of originalism and the Law and Economics network, the latter of which generated a dense body of scholarship on market efficiency.
Focusing on the legal dimension, however, understates the scope of Baradaran’s account. Alongside financialization, corporate politicking, and legal activism, The Quiet Coup encompasses conservative political reaction to the social movements of the 1960s (especially the Civil Rights Movement), the legacy of decolonization, and the alliance of the Christian Right with libertarian economics. What motivated and underpinned the various legal and policy innovations associated with neoliberalism, Baradaran argues, was an ideological response to social movements and to decolonization. Neoliberalism was, she writes, “the successor ideology of empire,” and it was “[domestic] racial resentments, more than budgetary constraints, [that] killed the [postwar] political consensus around the mixed economy.” Baradaran extends our view of neoliberalism further when framing it as this “successor” to global empire, provocatively noting a linkage between empire and Global North corporate interests. Such a linkage was pointed out at the time: Jamaica’s postcolonial leader Michael Manley, for example, compared the modern multinational corporation to the early-modern trading company as institutions that interwove private and public enterprise. And foundational neoliberal theorists in the Mont Pèlerin Society were deeply invested in maintaining neo-colonial economic hierarchies.
Yet the sweep and breadth of Baradaran’s account—touching on everything from empire to civil rights to campaign finance and antitrust—raises the question of whether neoliberalism can explain everything. Is there a unitary system of political, legal, and economic thought, crafted into laws and public policies by a set of ideological actors, that explains our world since the 1960s? It’s a seductive prospect: master this one equation, and you render perfectly legible six tumultuous decades of history.
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While appealing in its simultaneous intricacy and simplicity, however, this interpretation elides the specificity and variety of historical political developments. Baradaran suggests that neoliberalism’s quiet revolution was the historical phenomenon that overthrew the midcentury–postwar consensus. This “liberal consensus” supported regulation and welfare, as well as enacting – even more importantly, although Baradaran makes less mention of it – public economic management: the shaping of national, regional, and local development through industrial policies. But the so-called “liberal” consensus also rested on the existence of a conservative racial hierarchy, which complicates Baradaran’s rendering of the relationship between neoliberalism, postwar politics, and race relations.
The grand narrative of neoliberalism glosses over contradictions stitched into the fabric of America’s “liberal consensus” that helped pull it apart. While encompassing a powerful, market-shaping role for the federal state, the consensus disguised this role through administrative devolution and the use of public-private partnerships to administer both social and economic policies. The liberal consensus required a profoundly close relationship between government and business, which provoked both right- and left-wing critics.
Consider, for instance, Baradaran’s positioning of public interest lawyer and consumer rights advocate Ralph Nader as an implacable opponent of The Quiet Coup’s neoliberals, most notably Lewis F. Powell, Jr., a genteel Virginian corporate lawyer who joined the Supreme Court in 1971. Certainly, Nader battled corporate malfeasance. But when Baradaran laments that he “often criticized his natural allies” in government, she misses Nader’s fundamental point: the bureaucratic liberal state, with its imbricated public and private interests, was not his “natural ally” but his ultimate enemy. What Nader aimed for was the end of postwar “corporate liberalism,” not its reinforcement against a then-seemingly marginal Right. The fact that liberal-left critique and activism helped undermine the liberal state militates against reading the developments of this period as a purely “neoliberal” reaction. Even Lewis Powell’s infamous 1970 memo urging a defense of the “free enterprise system” was arguably animated by more than one political impulse: it seeded a pro-business intellectual ecosystem, but it also sought to resuscitate the cozy government-business partnership of the liberal consensus itself.
Moreover, by focusing on neoliberalism as a unified ideological project, Baradaran’s account gives short shrift to the structural economic transformations of the 1970s. Consequently, she risks obscuring a tricky fact: historical actors who cannot be easily identified with a “neoliberal” ideological movement took political decisions that unintentionally helped the reconfiguration of the postwar political economy, from Jimmy Carter or Paul Volcker in America to leaders of the social democratic Left like François Mitterand in France or James Callaghan in Britain. The roots of the structural transformation of the 1970s could also be found in the unanticipated consequences of earlier political decisions. For example, one factor leading to the U.S. industrial decline of the 1970s was American policymakers’ decision to develop the industrial economies of Cold War allies, while allowing these allies (most notably Japan) to implement “managed trade” policies that constrained American exports. Neoliberalism could only flourish in a context of 1970s structural upheaval, a multifaceted crisis brought about by the interplay and contingencies of political and economic decisions rather than through a unitary ideological project.
Baradaran’s choice of primary antagonist is telling in this regard: the lugubrious Alan Greenspan, a Wall Street consultant who counseled presidents Nixon and Ford before chairing the Federal Reserve from 1987 to 2006. Greenspan was once an acolyte of the ultra-libertarian Ayn Rand. He advised Nixon that using the state to tackle racial inequality would be an abrogation of “free enterprise.” And later, as Fed chair, he frequently opened the monetary spigot to keep financial markets buoyant. Yet if the neoliberal order has been defined by financialization and deindustrialization, these entwined processes were already deeply entrenched by the time Greenspan became Fed chair. There is little mention in The Quiet Coup of the Volcker Shock, a 1979 decision by then-Fed chair Paul Volcker to raise interest rates and constrain the rate of money-supply growth in order to bring down eye-wateringly high inflation. The 1980-1982 recession Volcker’s decision precipitated was an inflection point for the U.S. economy’s financialization. A historical episode like the Volcker Shock illustrates the trickiness of assigning the emergence of neoliberal economic conditions to a single, omnivorous ideological project. There are almost always alternative paths available to policymakers, and political priorities invariably shape decisions. But the Volcker Shock was not a choice made as part of a unitary ideological project, nor one with preordained long-term outcomes. Volcker himself, a lifelong Democrat, later criticized post-1980s financialization and authored an Obama-era regulatory rule to limit speculative trading.
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Understood as an orientation towards reconfiguring and insulating rather than towards “freeing” markets, neoliberalism has formidable diagnostic power for contemporary economic ills. The term usefully identifies conditions of financialization, domestic interregional inequality, and globalization. However, as a historical explanation of how these conditions emerged, it risks collapsing dynamic interactions of political activity and economic change, while obscuring moments when different ideological visions overlapped, informed, and competed. Baradaran lays out this complex – even ambiguous – narrative in her closing chapter and conclusion on neoliberalism’s future. Prognostications about the end of the neoliberal order proliferated in the wake of the COVID-19 pandemic, as the Biden Administration embarked on remarkably ambitious attempts to reinvent American industrial policy, recalibrate the U.S.’s relationship with China, and (less successfully) expand the social safety net.
In a clear-eyed critique, Baradaran pours cold water on this overheated “end of neoliberalism” froth. For every green industrial strategy, there is a crypto bubble. Moreover, for all that left-leaning and liberal commentators now critique the conditions of neoliberalism, it is unclear whether these critiques are rooted in durable political coalitions. Baradaran makes the provocative, highly astute point that if the 2020s are a decade of transition, it is worrying that figures on the Right traffic in “utopian” appeals far more fluently than do liberals or the Left, from emergent post-Trump populists to Silicon Valley’s sinister philosopher-king Peter Thiel.
This does not mean the neoliberal order is here to stay. After all, despite its ultimate failure to bring about a durable new political majority, the Biden Administration’s pursuit of “supply-side progressivism” notched significant accomplishments. And some leading Democratic officeholders argue that the attempt to move beyond a neoliberal political-economic order has only just begun. What Baradaran’s incisive, unsentimental conclusion underscores, however, is that shaping new conditions requires broad-based political support, responsiveness to circumstances, and, sometimes, the interplay of apparently opposed forces. Rather than a neat caesura between ideologically-monolithic eras, a moment of reshaping is usually a palimpsest of existing and new conditions. Reflecting on the 1970s dawn of the neoliberal political-economic order, Amy Offner describes historical upheavals as “[remaking] societies not by inverting their every feature but extinguishing a few of their defining elements and breathing new life into others.”
Understanding this must be policymakers’ starting point for successfully crafting a new order. Neoliberalism remains the best way to describe the political and economic order of post-1960s America. In fact, “neoliberalism” is more conceptually useful as a way to describe these conditions than it is as a definition of a coherent ideology. It would be a mistake, in other words, to see an order that can be termed “neoliberal” as having sprung from a single ideological fount. The variety and complexity of how this order came to be suggests why there remains so much uncertainty over the next moment of historical reshaping.
