Thoughts on Gerstle's The Rise and Fall of the Neoliberal Order

Every now and then I decide to get a bunch of books on a historical topic I obsess over, and this time it’s recent global political and economic history. Enough time has passed that I think we can get some perspective on the rise of neoliberalism and globalization, and how we have now transitioned out of the post-Cold War world order. We are currently standing at a historical crossroads, one where the future is uncertain. It’s good to figure out just how the hell we got here.

I decided to read Gary Gerstle’s The Rise and Fall of the Neoliberal Order, and was glad I did. I am a sucker for discussions of periodization, and Gerstle demonstrates how the New Deal established a political order that even Republicans had to conform to, to be replaced by a neoliberal order that Democrats had to submit to. He argues that we have witnessed the dissolution of the neoliberal order, with the contours of the new order still taking shape.

I agree very much with Gerstle’s central formulation, especially how it reveals that Reagan might have instigated the neoliberal turn, but it was solidified by Clinton. Important but overlooked moments like the Telecommunications Act of 1996 get their proper due, for example.

While Gerstle (like me) has leftist sympathies, he does not neglect to explain neoliberalism’s positive appeal. After the economic and political slides of the 70s, the idea of markets as a force of reinvigoration was attractive, especially in a world where government action had been thoroughly discredited by Vietnam and Watergate. His emphasis on it as a political order enmeshed with economic circumstances helps explain why Jimmy Carter, a Democrat, was the president to lead the initial drive towards government deregulation.

It’s a book I would highly recommend as a way to understand neoliberalism, as well as our current crossroads. At the same time, I think Gerstle misses some crucial nuances. In the book, he writes about how other scholars of the rise of political conservatism in the United States do too much to foreground so-called “culture wars.” He wants to keep the focus on political economy. While much is gained from this approach, his disdain of “culture wars” (perhaps a vestige of the old leftist “base-superstructure” model) undermines some of his analysis.

For example, Gerstle is entirely correct that Gingrich and Clinton, sworn enemies, collaborated in slashing welfare and in deregulating banking and telecommunications. He is also very observant in how Gingrich and Al Gore made were big public cheerleaders for a kind of techno-utopia inspired by the rise of the internet. However, he cannot explain how Gingrich could have the same neoliberal affinities as Clinton, but then do everything he could to destroy him. Gingrich forced a government shutdown soon after taking the Speakership and led the charge to have Clinton impeached over a BJ.

If both parties were advancing the same neoliberal goals, how could they have such antagonisms? Back in the 1950s, when Republicans acquiesced to the New Deal order, we did not see this kind of political antagonism. This could partially be explained by the Cold War being over in the 90s, eliminating a forced need for comity. However, I think the bundle of issues and identities blithely referred to as “culture wars” hold the key to understanding.

Gerstle chalks this up to two opposing visions of neoliberalism: the progressive one embracing cosmopolitanism and personal moral freedom exemplified by the 1960s, and a conservative one clinging to “neo-Victorianism” as a means to keep people tempted by the freedoms of consumer society in check. I think it goes far deeper than that.

The people who were the supposed other side of the neoliberal coin from Clinton refused to acknowledge his legitimacy. They tried everything they could to remove him from office. They HATED him with a hatred that’s hard to remember since it was later overshadowed by the same people’s hate of Barack Obama. While Gerstle is interested in political-economy, that’s a thing that I think motivates Americans’ politics less and less and less. Clinton’s economic policies did not matter, he was the avatar of the permissive 1960s, anathema to conservative voters. In his essence he embodied what they did not like. This is not about competing ideas of neoliberalism, it is about bone-deep identies far more powerful than belief in markets.

Conservatives gained power after Reagan less because of tax policy or deregulation, than they did because of guns and abortion. They got a lot of people who don’t believe in trickle-down economics to be hardcore Republicans because that party represents a “real American” Us versus a cosmopolitan, diverse Them. Gerstle doesn’t see this, and equates Trump’s rise with his critique of trade policy, which I think in most voters’ eyes was merely another element of nationalism.

Gerstle does not interrogate Trump’s attacks on “elites” deeply enough, either, seeing too many similarities between Trump and Bernie Sanders. Sanders was decrying an economic elite, whereas Trump and now DeSantis are going after a perceived cultural one, and in reality are just using that as a stalking horse to attack transgender people, immigrants and African Americans. When Republicans heard Trump attack NAFTA they did not hear “the economic elite benefits from fair trade” what they heard was an attack on Mexicans.

One frustration I have with many leftists is their inability to see that many political and cultural forces exist independently of economic causes. It would be good for Gerstle to read Jonathan Metzl’s Dying of Whiteness to understand how racist resentment is far more important to Trump’s appeal than economic grievance.

Nevertheless, I think Gerstle wrote a great book. I would just prefer it if we could find a way to discuss changes in political economy without making it the reductive mover of everything. It’s not. At the same time, I think Gerstle’s focus on neoliberalism allows to see the last fifty years of American history far more coherently. I am not sure what comes next, but this book has insight into how we got to where we are.