Invisible Logic: Boy, Do I Have a Conspiracy Theory for You

At page 99 of their substance-free investigation into the effects of the doctrine they call “neoliberalism,” George Monbiot and Peter Hutchison start talking about “conspiracy fictions,” which is what they prefer to call conspiracy theories. They allege that part of the reason the common people have not recognized the evil that neoliberalism has done to them is that its proponents distract them with conspiracy fictions about woke extremists taking over the establishment, and so on. It’s their equivalent of Marx’s “opiate of the masses” or Juvenal’s panem et circenses. Yet the irony is that this entire work, whose full title is Invisible Doctrine: The Secret History of Neoliberalism, is a conspiracy theory in exactly the standard definition.

The entirety of Invisible Doctrine is devoted to the proposition that “they” (I’ll get to “them” in a minute) used a doctrine called neoliberalism to appropriate wealth and hide it from democratic government. They did this by erecting a Potemkin Village of academics and think tanks that seized democracy and misled the public to continue their thieving. Whoever “they” are varies—at some points they’re the top 1%; at others, specific corporate overlords. But whoever “they” are, they have managed to capture the entire world in their net. If this reminds you of some theories from the 1930s, you wouldn’t be far off.

But before they can advance their argument, Monbiot and Hutchison first must redefine capitalism. They cite the standard definition: an economic system based on private property that sets prices according to supply and demand, where profit incentivizes activity. They then reject that definition and instead redefine capitalism as:

an economic system founded on colonial looting. It operates on a constantly shifting and self-consuming frontier, on which both state and powerful private interests use their laws, backed by the threat of violence, to turn shared resources into exclusive private property, and to transform natural wealth, labor, and money into commodities that can be accumulated.

Property is not just theft—it’s looting, an act of violence. Without it, we would have a state of natural wealth. No incentives, presumably, are needed for mankind to progress, because progress itself is unnecessary (at least that seems to be the implication of the argument).

This definition ignores what Deirdre McCloskey used to call “the great fact” and now calls “the great enrichment”—the hockey-stick-shaped explosion of wealth for all mankind since the replacement of older systems by capitalism in the last few hundred years. In particular, Monbiot and Hutchison blatantly ignore the vast improvement of living standards among the world’s poorest in the last couple of decades.

They routinely assert that we live in a world where “the rich get richer and the poor get poorer” and that “the global South” is being wrecked, when the evidence is completely the other way round (except in places like Venezuela that are suffering from the ills of state socialism). Their evidence for the poor getting poorer is based on measures of inequality. For instance, at one point they claim that the lowest 50% in America are billions of dollars worse off than they were in the 1980s. However, this is based on wealth shares—in other words, if the lowest 50% still held the same share of wealth as they did then, they would hold, in aggregate, more wealth.

What that statistic hides is that the total amount of wealth held by the lower half has actually increased substantially in real terms. As with all matters of inequality, the question to ask is “How are the poor actually doing?”—and the indicators of wealth suggest that they are doing much better now, thank you very much.

This lack of serious questioning about what the authors of Invisible Doctrine are asserting infests the book. To be fair, it’s obviously intended as a polemic, but it fails the intellectual Turing Test (the idea that to understand what your intellectual opponents are saying, you must be able to state their arguments in terms they would recognize as fair). For instance, the late economist Steven Horwitz would make the argument that market competition is actually how we cooperate as a society. There is no acknowledgment in this book that arguments like this even exist, except in implication in the authors’ assertions that academic arguments are bought and paid for by “them.” There is certainly no attempt to treat such arguments fairly.

Such lack of intellectual curiosity extends to the authors’ treatment of history. For instance, they devote a good deal of space to what they say are the origins of capitalism on the island of Madeira in the 1400s. This is a great example, they think, because it illustrates the way in which capitalists looted colonial resources—industry on Madeira failed because its rulers used up all the resources there.

Yet most historians trace the origins of capitalism to the North Sea countries in the late 1600s, not to an island off Africa in the 1400s. The reasons should be obvious: Madeira was settled and exploited under the late feudal system, and the economic activities there were subject to the desires of the Portuguese crown, not any joint-stock companies. Monbiot and Hutchison say the cycle of “boom, bust, quit” repeated itself in Portuguese colonial exploits, moving from Madeira to Sao Tome to Brazil, with unfortunate consequences for the environment and for the enslaved labor. Yet Portuguese colonialism in the 15th and 16th centuries is surely not capitalism (nor do the authors spend any time on, for instance, Adam Smith’s discourses on the unproductive nature of slavery).

The absence of any potential challenges to their assertions also haunts their treatment of John Locke, whom they blame for the intellectual backing of the evil idea of private property. In particular, they point to his arguments on mixing labor with natural resources in the context of the Americas. Once this this theory was put into action, they suggest, all American land was stolen and exploited. Yet the authors fail to note the famous “Lockean proviso”—the principle that people may homestead unused land provided that “there was still enough, and as good, left; and more than the yet unprovided could use.” To be sure, many thinkers that Monbiot and Hutchison would call “neoliberal” reject the idea of the proviso, but Locke didn’t, and the authors don’t even acknowledge it exists.

Indeed, the term “neoliberal” itself is an example of the authors’ habit of treating questionable assertions as foundational facts. They claim that the initial cabal of “neoliberals” called themselves such and then erased the term from history. Indeed, there are sporadic examples of the use of the word from the 1930s to the 1950s, but a simple Google Ngram of the term reveals almost no usage at all until the 1990s, when it started to take off. As the economic historian Phil Magness has shown, such modern usage is almost entirely pejorative. In fact, very few people claimed to be neoliberal (at least until the U.K.’s Adam Smith Institute decided to owned the term, but that didn’t really take). This allows people of ill will to use it as they please, and this book is a fine example of that.

Read the full article at Action Institute .