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Topics: Economics, Third World, World Bank Pages: 9 (3110 words) Published: May 12, 2014
Political and Cultural Consequences of Neo-Liberalism
Introduction
The word neo-liberalism can be rooted from globalisation. The term neo-liberalism could also imply fundamentalism, and these two terms are in most cases interchangeably used. Neo-liberalism can be defined as a conjecture of political economic, which holds that the ultimate well being of people can only be improved through liberating their individual entrepreneurial freedoms and skills. This theory suggests that individual entrepreneurial freedom can be achieved inside an institutional framework that is distinguished by strong private property rights, free markets and free trade. Neo-liberalism as a theory requires that the role of state should be, to create and protect the institutional framework developed. The state, therefore, should set up all the necessary mechanisms and institutions such as the military, defence, police, and legal structures to secure such institutions. When this is done, the state would have guaranteed property rights and proper functioning of markets. Furthermore, the law of neo-liberalism states that if markets are nonexistent, then the government must create them (Harvey, 2005:1). The state is not supposed to go beyond creation of markets and institutions necessary. This means that the state should not interfere with the markets once created. It should keep a minimal role, because, according to this theory, the government does not have sufficient knowledge on the market undertaking. Moreover, some people in the market may bias state interference for their own gains. Deregulation of market functioning, privatisation of companies, and removal of the government interference have been the strongest terms of neo-liberalism in the world today (Foucault, 2008:2). A neoliberal government is thus committed to instituting and favouring strong individual property rights, effective rule of law for all its citizens, and freely enabled markets trade. According to the theory, these are the fundamental institutional structures regarded indispensable to guarantee the freedom of the market. The market then requires a legal structure that is liberally bargained in terms of contractual efforts among the market players. These contractual obligations between individuals, would lead to the protection of individual rights to freedom of operation, right to expression, and choice. According to the theory of liberalism, therefore, the state has to use its monopoly power to supervise and oversee the markets at all costs. On the contrary, while the state ensures individual and rights in the marketplace, each person is held accountable and liable for his or her well-being. The principle of neo-liberalism in many countries today has extended into the spheres economical, political, and social-cultural areas (Leys, 2001:14). Having neo-liberalism defined in the above discuss, this paper would seek to unveil the political and cultural consequences of neo-liberalism. First, this paper would put the political consequences of neo-liberalism into perspective. Therefore, the political consequences of the theory of liberalism as destroying the global democracy, governance, and security of individuals take centre stage. The political neoliberals have distorted the fundamental pillars of global social organisation. Political neo-liberalism is the interaction between the state organs and individuals to influence choices. It is a form of social structure, which moulds the behaviours and actions of individuals. Neo-liberalism as a subset of globalisation has lead to neoliberal politics that have caused massive deprivation among the poor in many regions around the world. Moreover, neo-liberalism policies qualify as both positive and negative depending of the degree of application (Leys, 2001:14). Neo-liberalism in most parts of the world has led to the formation of strong fiscal policies. Many governments have had to practice strict criteria in the effort to limit budget...

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