So far I've summarized the first three lectures in The Birth of Biopolitics. Focusing on liberalism as the setting for the emergence of biopolitics, Foucault portrays liberalism as an apparatus or formation of govenmentality that, in its efforts to produce regime, in fact produces extensive constraints on freedom.
On the one hand, his account is of a piece with similar attacks on the welfare state from the late 70s, attacks from the left as well as the right. It presents a certain crisis of capitalism and the welfare state as what one could also call an ideological crisis, a crisis of liberalism. To make this argument, he has to employ a very broad notion of liberalism, one that includes the French Revolution, English utilitarianism, and Keynesian economic policy. What justifies this broad approach, as far as I can tell, is Foucault emphasis on techniques of government, or discussions of policy and regulatory efforts, particularly in the context of their emergence in the middle of the 18th century.
On the other, and rather surprisingly, the story he tells takes the form of an Oedipal tragic drama: "in my very effort not to kill my father and marry my mother, I . . . kill my father and marry my mother." Liberalism attempts to produce freedom, sets it task as producing freedom, but in fact does the opposite.
This, then, is the background against which Foucault discusses German neoliberalism (or ordo liberalism) as a distinct change within liberalism. Neoliberalism emerges in response and reaction to crises in liberalism. It involves a change within liberalism. What do we find again but....psychoanalysis.
Foucault begins his January 31 lecture with the idea of state-phobia. A certain fear of the state, he points out, is characteristic of the moment in which he is writing, of 'contemporary themes' the most pronounced of which involves fear of the atomic bomb. State-phobia is a sign or symptom of the crises of governmentality that seem inextricable from liberalism, whether the liberalism emerging in the middle of the 18th century or the liberalism of 1979. Thus, Foucault does not take up state-phobia directly but rather in terms of governmentality. This discussion will take him to the emergence of neoliberalism as a reaction [formation] to a generalized mistrust [anxiety] regarding the state.
1. Not taking up state-phobia directly makes sense since for Foucault
So the state is not an institution. It is not an arrangement of sovereignty. It is not a constant in a territory or with respect to a constitution or population. It is an effect and a mobile one at that. It is an effect of governmentalities which we might understand as techniques of production, incitement, channeling, and repression. (It's almost as if the state were a drive, that is, an assemblage around source, pressure, object, and aim.) To analyze anxiety about the state, then, Foucault does not approach it as such, as a something that exists, but in terms of what causes it as an effect, namely, governmentality.
2. State phobia is central to contemporary neoliberalism. Foucault considers its German form, which is linked in part to the crisis of National Socialism and its American form which is a reaction to the New Deal. He notes that both versions have the same 'objects of repulsion,' namely, the state-controlled economy, planning, and state interventionism. The German form is the primary topic of the remainder of the January 31 lecture as well as the February 7, 14, and 21 lectures. (The remainder of my summary of these lectures is highly selective.)
3. Particularly noteworthy for Foucault is the formation of the German state after WWII. (His account here relies on analysis of a statement by Ludwig Erhard in 1948.) How would it be possible? On what grounds? It can't be founded on something like sovereignty as a juridical power of coercion. We are far removed from the state or the sovereign as having some kind of power of life and death. The function of the state, then, is to guarantee freedom, particularly a domain of economic freedom. Economic freedom, in other words, will be the foundation for the state. The state will exist to guarantee this freedom. And the economy will then produce political sovereignty:
The economy produces legitimacy for the state that is its guarantor.
4. Contemporary Germany, then, results from a circuit from economy to state, a circuit that produces more than legal legitimacy; it also produces
a. a kind of consensus among investors, workers, employers. Consensus is its 'surplus product.'
b. "political signs that enable the structures, mechanisms, and justifications of power to function"
5. Foucault links German neoliberalism to a specific critique of Nazism raised by the 'ordoliberals' working in Freiburg. Rather than repeating the details of this, I mention Foucault's discussion of the conclusion the ordoliberals drew from their analysis. The crude version: do the opposite of what the Nazi's did. The experience of Nazism proves that all the defects previously attributed to the market are really products of the state. The state is the real problem, the real danger. There is nothing about the market that is intrinsically defective. So, really what we need is more market and less state.
instead of accepting a free market defined by the state and kept as it were under state supervision--which was, in a way, the initial formulation of liberalism--let us establish a space of economic freedom and let us circumscribe it by a state will supervise it--the ordoliberals say we should completely turn the formula around and adopt the free market as organizing and regulating principle of the state...In other words, a state under the supervision of the market rather than a market supervised by the state.
The market, then, will regulate the state. It will be the vehicle and principle for its internal regulation, precisely because of the state's intrinsic defects.
6. Foucault explains that this move to the market required a number of shifts from traditional liberalism:
a. from exchange to competition; rather than construing the role of the state as ensuring free exchanges, neoliberalism says that what's most important about the market is competition. This competition, moreover, is not some kind of natural Darwinianism associated with instincts and appetites. Rather, it is a kind of formal game. It needs to be produced, secured, guaranteed. Pure competition may actually be impossible to achieve, but it is and must be an objective. This, then, is a move away from laissez-faire and toward vigilance and activity. Societal/social policy must not 'nullify the anti-social effects of competition;' rather, it has to combat ant-competitive mechanisms.
b. "One must govern for the market, rather than because of the market." Again, the defects aren't in the market. The state doesn't remedy or redress market deficiencies. The state protects and secures the market.
7. Neoliberal social policy:in light of the ordoliberal emphasis in making the state subject to the economy, or taking the market as the basic principle of the state, what was its social policy? Notice that the social policy makes clear that neoliberal governance is a neoliberal approach to society as well as to government; it is a way to manage society in terms of the economy. So society is the target of government, in the name and interest of the economy. Neoliberalism entails a governmentality of "active, multiple, vigilant, and ominpresent" intervention in society.
a. Clearly, it was opposed to the Keynesian or New Deal objective of equality. Instead, it sought to let inequality function, to release it as a social regulator that would have recognizable effects.
b. Privatization (individual social policy); there is no social cover for risks but rather the establishment of an economic space in which individuals can take responsibility for their own risks.
c. economic growth: this is the only true social policy; government intervenes in society to make sure that this happens and that it happens via the proper competitive mechanisms.
8. The neoliberal attempt to make the market the regulatory principle of society is not a society of consumption. It's not about furthering consumption or the circulation of commodities or even the society of the spectacle. Instead, it's an enterprise society subject to the dynamic of competition.
9. The multiplication and differentiation of enterprises breaks with the uniformity of commodity culture and the standardization of mass society. And this enterprise society involves a Vitalpolitik, a politics of life (he returns to this idea in the March 21 lecture). This enterprise society idea is one of two axes stressed by ordoliberals.
10. The other axis is the rule of law. The expansion in the number of enterprises creates more opportunities for friction and conflict. Many of these conflicts cannot be resolved via the market but require judicial intervention and arbitration
11. The economy isn't natural. Perhaps the key turning point from 18th century liberalism to 20th century neoliberalism is located in the rejection of the idea that the market or the economy is somehow natural.Far from some kind of natural domain, the economy is understood by neoliberals as nothing other than the effect of a legal order. The juridical gives form to the economic.
a. There is not first something like an economy to which legal processes are then added. Rather, the economy is from the beginning 'a set of regulated activities.' In fact, the economic is not a process that can be separated out of the social (except abstractly)--it's always and only a set of regulated activities.
b. So capitalism isn't a force from below that comes up against, say, laws of primogeniture.
c. Capitalism isn't singular; it changes and adapts.
To my mind, these points call into question Zizek's claim for a parallax view between economy and politics: there is no relation between economy and politics, no metalanguage that accounts for both. I've had problems with this for years, sometimes wondering if he means 'for contemporary Marxists' or 'for contemporary post-Marxists.' I've also disagreed with his claim that Capital is Real, in part because this sort of view fails to recognize the historical changes within capitalism as well as the state's role in producing capitalism. On these points, then, I side with Foucault.