Liberalism and neo-liberalism: Continuity or rupture
Posted on March 7th, 2019

By sumanasiri liyanage Courtesy Ceylon Today

The direction is now clear. Day before yesterday, it was students of higher education institutions. Yesterday, it was unemployed graduates seeking employment. Then Government teachers raised their grievances. These events have shown at least symbolically the direction towards which the country is moving. As some observers tend to define the present Government as liberal democratic, they would also argue that these oppositionist forces, which are on the other side of the fence, support, wittingly or unwittingly, non-liberal and anti-democratic forces in the country.

Hence, they may say that the suppression of these forces can be legitimised on the ground that such brutal Police action were/are and will be imperative to defend democracy. These observers seem oppositionists and the neo-liberalism which  the present Government practices is nothing but a continuation of classical liberalism that the political science text books talk about. Is it true? Does neo-liberalism represent a continuation of or a rupture from classical liberalism? Answering this question may lead us to look at those protests from a different perspective?

Encyclopaedia Britannica defines liberalism as a political and economic doctrine that emphasises individual autonomy, equality of opportunity, and the protection of individual rights (primarily to life, liberty, and property); originally against the State and later against both the State and private economic actors; including businesses”. Its most humane views can be found in the writings of John Stuart Mill; who advocated that the laws of distribution of wealth and income should be different from the objective laws that govern production.

The extension of Mill’s ideas can be found in the writings of John Rawls. According to Rawls, Social and economic inequalities are to satisfy two conditions: First, they are to be attached to positions and offices open to all under conditions of fairness and equality of opportunity; and second, they are to be to the greatest benefit of the least advantaged members of society”(emphasis mine).

Of course, one may criticise these views as utopian arguing, I think justifiably, that these goals cannot be achieved if the means of production are privately owned and used to exploit others. Nonetheless, the moral and political principles that lie behind the idea of liberalism are to be appreciated and valued to protect individual from many kinds of tyrannical rule. In spite of the presence of many deviations, Sri Lanka has had a reasonably good record, until 1977, in maintaining these values.


What had happened, in 1977 and after, was not a continuation of these values and principles but a complete rupture although the process of rupture was slow and creeping. Neo-liberalism attempts to maintain a formal resemblance with classical liberalism, but completely emptying its content. To understand what neo-liberalism is the following description by David Harvey would be useful.

Neo-liberalism is a theory of political economic practices proposing that human well-being can best be advanced by the maximisation of entrepreneurial freedoms within an institutional framework characterised by private property rights, individual liberty, unencumbered markets, and free trade. The role of the State is to create and preserve an institutional framework appropriate to such practices.

The State has to be concerned, for example with the quality and integrity of money. It must also set up Military, Defence, Police, and juridical functions required to secure private property rights and to support freely functioning markets. Furthermore, if markets do not exist (in areas such as education, health care, social security, or environmental pollution), then they must be created, by State action if necessary.

But beyond these tasks the State should not venture. State interventions in markets (once created) must be kept to a bare minimum because the State cannot possibly possess enough information to second-guess market signals (prices) and because powerful interests will inevitably distort and bias State interventions (particularly in democracies) for their own benefit.”

Qualitative difference between liberalism and neo-liberalism is not hard to diagnose. In neo-liberalism, unlike in classical liberalism, the most important element is not an individual with specific rights, but markets. It posits that individual should be thrown into markets in every sphere of her life for it to be improved and advanced. So it is neither an individual nor the State that determines her destiny but the markets in which as Mandel informed us money and power decide.

Amalgam of three aspects

Neo-liberalism is to be understood as an amalgam of three elements. First, it is an ideology that influences and moulds our way of thinking. Since 1977 our way of thinking was moulded so that we look at events and try to understand phenomena from this neo-liberal prism. A justifiable and legitimate protest by one group of people (say students, unemployed graduates and teachers) will be deciphered as public nuisance” from another section of people until they were forced to face a similar situation. Because, that is how we were led to think.

Secondly, neo-liberalism is a technique of governmentality. Elections may be held. It is necessary to remember in passing that since 2015, this right was also taken away from the people of Sri Lanka. Real governance is controlled by local and international technocrats and econocrats. Democratic governance has become nothing more than a chimera.

Thirdly, neo-liberalism is package of policies. Since 1977, this policy package has produced de-industrialisation, deficit in trade balance, indebtedness, unemployment and many other ailments leaving Sri Lanka to all whims and fancies of globalisation.

Protests and resistance

Protests and resistance thus marked the dissatisfaction of social groups; especially in the lower-rung of society. Different social groups would express their dissatisfaction and grievances at different spatial and temporal fields.

As a result, it may be difficult to understand them as an outcome of a structural crisis that was created by neo-liberalism because we were tied to neo-liberal ideology. Is this, what is called ‘false consciousness’ that we should overcome? If someone is trying to paint neo-liberalism as classical liberalism, he may not be able to distinguish cheese from cocaine just because they both are white.
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