From the irrationalism of the market to the irrationalism of life in neoliberalism

From the irrationalism of the market to the irrationalism of life in neoliberalism

by Patrick Schreiner

[This article published on 6/4/2020 is translated from the German on the Internet, https://www.blickpunkt-wiso.de/post/vom-irrationalismus-des-marktes-zum-irrationalismus-des-lebens-im-neoliberalismus--2269.html.]


When the media, politicians and the public speak of "neoliberalism", this usually means a bundle of economic and socio-political convictions and measures. More market and less market intervention is the core of this thinking, but its irrationalism goes much further.

More market and less market intervention is the core of this thinking, from which "reforms" such as wage cuts, labor market flexibilization, social cuts or tax reductions for high incomes and profits are then derived. To understand "neoliberalism" in this way is appropriate - and yet incomplete. For the perspective described ignores the fact that neoliberalism is more than economic and social policy than social inequality and market extremism: Neoliberalism goes hand in hand with an image of man and society that shapes people's thoughts and actions even in the most banal everyday life. It is always also a very specific way of leading one's life. Neoliberalism, so the thesis of this article, was able to revolutionize society and politics in virtually all countries so persistently and successfully according to its ideas precisely because it appears in many places to be harmless and apolitical - common sense if you will. This reveals irrationalism that is essentially irrationalism towards the market. This will be shown in the following with the example of certain guidebook literature, for which the term "life counseling" seems to be appropriate.

The following reflections on "Living in Neoliberalism" are based on two book publications by the author on the subject (Schreiner 2018a, Schreiner 2018b) and supplement these.

The Neoliberal Irrationalism of the Market

The focus of neoliberal thinking is not "the markets" in their diversity and respective specificity, but "the market" as an abstract concept and principle. The neoliberals ascribe to it their own regularities, they understand it as something that runs by itself, autonomous, always the same and superior. It is considered to be the good par excellence, which they confront with evil, by which it is constantly threatened: "the state" or "politics". Thus "the market" is for them at once a social ideal (in the sense of a utopia to be striven for), a political task (the market is to be kept pure from external intervention) and a political instrument (the market replaces the state to a large extent as a means of shaping and steering society) (Ötsch/Pühringer 2015; Thomasberger 2009; Ötsch 2011).

By making the market absolute in this abstract way, neoliberalism develops a very idiosyncratic understanding of freedom and of performance or justice. From this point of view, a market actor is free if his market actions are not guided or even influenced by political intervention. In particular, the preservation of private property is central, including private ownership of the means of production. Freedom is thus per se a category that can only take place on and with markets. Politics or democracy are not only unable to realize freedom. They even threaten freedom because and when they intervene in markets (Hayek 1977; Hayek 1981). It is therefore not unfree if, for example, low wages mean that a person has to work 80 hours a week to survive. It is not unfree if you can only keep yourself halfway above water by collecting bottles. It is not unfree if social benefits prevent people from collecting bottles or if collective agreements prevent them from working for low wages. By definition, compulsion does not come from the market (Hayek 2005). This is also the background to the well-known statement of the neoliberal mastermind Friedrich August von Hayek that personal freedom in Chile was greater under the dictator Augusto Pinochet than under the democratically elected left-wing president Salvador Allende.

The neoliberal concept of justice - and the related concept of achievement - is similarly idiosyncratic. What is decisive here is the idea that the distribution results of functioning markets are always just and superior to any other distribution variant. Hayek writes:

"Justice does not deal with the results of the various transactions, but only with the question whether the transactions themselves were fair." (Hayek 1986: 189).

From a neoliberal point of view, then, any form of "reward" or "punishment" by the market is fair, as long as it is only just carried out by the market and is not influenced by outside. Whoever argues in this way, however, has a problem: It is by no means certain that effort and endeavor are also worthwhile.
Anyone who argues like this, however, has a problem: It is by no means certain that effort and effort are worthwhile. Whether a person spends a lot of little time, has acquired a lot of little education, uses a lot or little energy, is concentrated or unfocused, etc. - none of this is relevant. The only thing that matters is whether the market rewards the efforts in question or not. Hayek makes it explicitly clear that although one may increase one's chances of success through effort, a market does not or cannot take individual merits and efforts into account:

"But this success came about because the reward for individuals' achievements depended on objective facts that nobody could know all of, and not on anyone's opinion of what they should receive. But this also meant that, although ability and diligence might improve the chances of each individual, it could not guarantee a certain income, and that the impersonal process, which used all the scattered knowledge, set the signals of the prices in such a way that people were told what to do, took no account of needs and merits. (Hayek 1977: 31).

One could take this observation as a reason for a critical attitude towards the market, which Hayek, as a neoliberal, of course, does not do. But at this point, he is, after all, much more realistic and honest than all those in politics, media, and science who everywhere sing the wrong song of praise for achievements that are worthwhile. This honesty is nevertheless a risky luxury inasmuch as the song of praise for worthwhile achievement is - from a neoliberal point of view - a perfectly logical reaction to an objective dilemma. After all, one can hardly recommend people to do nothing and wait and see whether they are rewarded by the market or not. That is not how capitalism and society work. And that is precisely why we see people being taught the mantra of rewarding performance on a daily basis: You just have to work hard and you will succeed. Then you will be rewarded by the market. And if success does not come, then it is your own fault. Unemployment or employment? Sickness or health? Poverty or prosperity? They all lie - so it is claimed - in the responsibility of each and every individual.

Hayek, too, thinks it is sensible and right to make people believe, against their better judgment, that performance is worthwhile:

"It is certainly important in a market organization [...] that individuals are convinced that their well-being depends primarily on their own efforts and convictions. In fact, there are few circumstances that are more likely to make a person energetic and efficient than the conviction that it is primarily up to him to achieve the goals he has set for himself. For this reason, this conviction is often encouraged by education and the prevailing opinion - in general, it seems to me, to the great benefit of most members of society [...]. (Hayek 1981: 106-107).

The constant moralizing murmur of the worthwhile achievement is obviously not without resonance. In fact, many people fall for such beliefs and believe that the market rewards effort and endeavor. And consequently, they then follow a kind of neoliberal morality that gives them appropriate instructions for action: Be in line with the market! Discipline yourself - down with your inner bastard! Be active! Adapt to the demands of the market and society! Assert yourself in competition with others! Think entrepreneurially! Or in Hayek's words: Be "energetic and efficient"!

Such thinking and acting are rational insofar as it is strictly oriented towards purposes and goals. Reason here does not serve to understand, question, or even change the market or society. Instead, it serves to control one's own behavior in neoliberal capitalism and to direct, optimize, and manipulate it in a goal-oriented manner. It serves the purpose of adaptation. Hayek speaks of "competition" as requiring people to "behave rationally" (Hayek 1981: 108). It is a self-rational behavior within the unquestioned and unquestionable framework of the neoliberal market.

With its self-limitation this rationalism is systematically subordinated to irrationalism: namely, the irrational conviction that human reason is incapable of understanding or even changing the world and contemporary societies. And the irrational conviction, because it is unfounded and unjustifiable, that the market rewards individual good behavior - that performance is worthwhile. Reason is limited to one's own thinking and behavior.
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Reason does not question the market and is not allowed to do so. It accepts it as a neutral and objective assessment authority. The market takes the place of reason on a collective, social level: it is not the human being, but the market (mediated by prices) that provides for a good and appropriate social order. Man's attitude towards the market is passive, believing, almost submissive. Probably nothing expresses this irrationalism better than Adam Smiths' formulation of the invisible hand, which neo-liberals like to quote - but which for Smith nevertheless did not have the meaning that some people ascribe to it (Herrmann 2017).

Hayek expressly calls for such a self-limitation of human reason:

"Man has certainly often learned to do the right thing without understanding why it was right, and even today his habits often serve him better than understanding. The brain is an organ that enables us to absorb the culture, but not to design it. (Hayek 1981: 213-214).

Elsewhere he writes that morality developed parallel to reason and is not the result of it (Hayek 1996: 6). Precisely because man is not able to understand and overlook society, he has to submit to the market. The latter becomes "a kind of supra-reason" (Ötsch/Pühringer 2015: 17), a central element of a higher order, which man likewise cannot understand, but only accept. (For Hayek, this order and the market are the results of a long process of cultural selection. Such evolutionist approaches form a minority in neoliberal thinking. The primacy of the market over human reason can nevertheless be asserted and justified in many ways).

Guide literature between industry and esotericism

The Evangelical American priest and author Norman Vincent Peale let the readers of his bestseller "The Power of Positive Thinking" know optimistically:

"This book will show you how to change and improve the present circumstances of your life and how to gain control over them instead of being dominated by them." (Peale 2006: 8).

What at first glance appears to be a rejection of subordination to the prevailing conditions is the exact opposite. Peale claims to guide people to lead a better life: to develop as a personality, to make friends and gain recognition, to become healthier, richer, more motivated, and more successful. A positive attitude to life is the key to such a better life - more self-confidence, a more positive attitude, optimism, and last but not least prayer and faith in God. The term "positive thinking", which Peale included in the title of his main work, expresses this approach quite well. Behind it is the conviction that there is a close connection between the inner attitude of a person and his outer (social, economic, physical, personal...) situation: The more positive the inner attitude, the more positive life.

This approach is necessarily limited to changes within the existing conditions - even more: to changes exclusively of the person himself. And that means each individual, not humanity or society as such:

"My friend has found a new attitude towards himself and his life. He became healthy, happy, and free." (Peale 2006: 45).

"Happiness is attainable, and the path to it is open to everyone." (Peale 2006: 83).

Peale's experience reports are the most extensive - he writes about people whom he allegedly helped, about positive examples from which he could learn, or about negative examples which he put on the right path. Remarkably many of these people are entrepreneurs, businessmen, managers, or the like. Peale, therefore, has a positive attitude towards the market. His life counseling also and especially aims at success on the market by adapting the way people think and act.

Peale is a comparatively early representative of an industry that has now virtually grown into an industry: With life coaching in the broadest sense on topics such as success, self-confidence, relationships or motivation, authors, "speakers" and "coaches" reach a mass audience. In books, lectures, and seminars, they convey alleged knowledge that is supposed to show people ways to a supposedly happier life. Their teachings always have two basic elements: an individualistic approach, according to which responsibility and possibilities for action lie with each individual person, and an irrational belief in some kind of superior justice and order.

A younger representative of this industry is the Australian journalist and author Rhonda Byrne. What is "positive thinking" for Peale (and many others) is "the law of attraction" for Byrne (and many others). She writes about it:

"By the power of this most powerful law, your thoughts become the things in your life. Your thoughts become things!" (Byrne 2007: 24).

"If you concentrate intensely on your desires in your thoughts, then at the same moment you summon up what you want with the most powerful force in the universe. (Byrne 2007: 29).

Every human being could, therefore, achieve everything, could fulfill all wishes - if only he concentrated his thoughts accordingly on the fulfillment of these wishes. Through thinking and wishing alone, one attracts positive - or even negative - things in life. The manipulation of one's thoughts and inner attitude is therefore meaningful and necessary in order to be successful. The spectrum of what Byrne promises to achieve on this path is wide: money, relationships, self-knowledge, health, and much more. The intersections of these beliefs with "positive thinking" are obvious; both, incidentally, have their roots in the esotericism of the late 19th century.

With Byrne, unlike Peale, belief in God no longer plays a role. She rather bases her teaching on science and physics ("quantum physics"):

"Since you are energy, you too vibrate at a frequency determined by your present feelings and thoughts. If you think of what you want and send out this frequency, you cause the energy of the desired thing to vibrate on this frequency - and you attract it! (Byrne 2007: 186-187)

Ilja Grzeskowitz, who according to the blurb is after all one of "Germany's top speakers", does not spend much time with so much irrational, pseudo-scientific nonsense. He also refers to the "law of attraction", but gives a more casual explanation:

"In order to explain the law of attraction comprehensively, I could now take a long excursion into the exciting world of quantum physics, but in this case, it is not important at all why it works so well, the only thing that matters is that it does. The world is full of living proof that it does." (Grzeskowitz 2012: 72).

What Peale, Byrne, Grzeskowitz and their many colleagues have in common is that they immunize themselves against being refuted. For regardless of whether the reason for "positive thinking" or the "law of attraction" is God or nature or whether no reason is given at all: counter-examples can always be interpreted as misconduct of the people concerned. Who does not become rich, then simply has not thought enough about wealth. Whoever has problems in life simply does not think positively enough. And whoever becomes ill should work more and better on his inner attitude.

The intersections of this thinking with neo-liberal beliefs are just as evident as the common immunization strategy: every person could achieve everything if he or she only wanted to and thought and acted accordingly. And those who do not get anywhere have simply not made enough effort. Neoliberal morality is being sold here.

While Peale and Byrne give the impression that mere thinking about a better life is enough, Grzeskowitz criticizes this idea. Mere thinking and wishing are not enough, one must rather act accordingly to achieve goals. One must develop a "doer mentality" (Grzeskowitz 2012: 73). But then success and wealth would really be guaranteed. This conviction is already expressed in the title of his book: "Think yourself rich! Wealth is a matter of attitude".

As with Peale, "the entrepreneur" is a central figure in Grzeskowitz's work. Figuratively speaking, he understands by it all those persons who have appropriate inner attitudes and behavior. In this way, the entrepreneurs know that the secret of success is to stand up once more than to fall down. And unlike the "Unterlasser", who has established himself in his "comfort zone", the "entrepreneur" actually "actively tackles":

"He does not wait for what fate has in store for him but determines it himself through his drive and actions. He directs his entire focus to chances and possibilities, ready to seize them when they arise." (Grzeskowitz 2012: 17).

Peale, Byrne, Grzeskowitz, and many others teach self-optimization, or more precisely: a form of self-optimization that aims at the right inner attitude and behavior. In doing so, they also teach what Hayek described as inaccurate, but nevertheless indispensable for capitalist societies: the belief that every person can achieve everything if they only want to.

By aiming their advice at changing the individual person, they leave social and economic conditions untouched. They accept them - and convey to their readers that it is not the change in politics and society that counts, but only self-change. They reject the collective comprehensibility and formability of society in favor of the formation of the self. In essence, this means a transfer of neoliberal political content in a non-political form to people's lives.

An explicit examination of the concept "of the market" will not be found with them. But when Peale and Grzeskowitz repeatedly cite entrepreneurial figures, and when money is a central goal in the lives of all three of them, it becomes clear that they do link their convictions prominently with economic issues.

Irrationalism in two forms

The irrationalism of the market in neo-liberalism described at the beginning is essentially irrationalism of man in relation to the market: this and its results are not rationally questioned but accepted. Instead, people develop "strategies" for dealing with this situation. The use of reason is limited to perfecting these strategies. The market is regarded as a kind of fair reward system: rewarded (in a more realistic neo-liberal interpretation) is who best meets a certain demand, or rewarded (in an official neo-liberal interpretation) is who makes a special effort and achieves a special amount.

This constellation recurs in the guidebook literature. Peale, Byrne, Grzeskowitz, and many others share the irrational belief that there is some kind of higher-level reward system that judges and either rewards or punishes individualistic thinking and behavior. Be it "God", the "universe", a "spirit", the "law of attraction" or whatever: Here too, man does not have to question the higher-order, but rather accept it as just. And also here he should limit his reason to perfect his individual strategy in dealing with this order. The market is obviously part of this order. Recommended are effort, self-optimization, and self-manipulation - as in neoliberalism.

Karl Marx argues, as is well known, that people no longer recognize the social relationships behind the goods produced by the division of labor that they exchange with each other on the market. In their eyes, the human relationship between two producers of goods becomes rather a factual relationship between two goods; he speaks of the "fetish character of goods" (Marx 1962). Behind the surface of the exchange of goods, Marx thus sees an entire form of society and mode of production hidden. But not only that: social form and mode of production gain superiority over the man himself. They face him as something that (apparently) can neither be understood nor controlled. Marx's image of the fetish character of the commodity thus shows certain similarities with Hayek's idea of "the market". However, while Hayek explicitly wants to limit human reason to act in the market and to prevent it from understanding the market, and while the described guidebook literature sells such thinking and behavior as an appropriate maxim for life, Marx demands exactly the opposite: to understand the form of society and the mode of production in order to be able to change them and make them humane. Exactly here the difference between Enlightenment and irrationalism, between reason and esotericism, is founded (Schreiner 2018b).

The irrationalism of life in neoliberalism and the compulsion for permanent self-optimization and self-manipulation are not limited to guidebook literature in contemporary societies. They are also to be found, for example, in the education system, where education is increasingly limited to the acquisition of skills and is primarily intended to help people sell their own labor on the market. They can be found in casting shows, where young people want to realize their "dream" and blindly submit to the rules of the neoliberal meritocracy. They can be found in fitness studios, which are mostly not primarily used for health promotion, but for physical self-optimization. This list is far from complete (Schreiner 2018a).

Why do people go through this?

Finally, the question remains why people take part in such a thing at all. The fact that they do it seems obvious: Peale's main work has been translated into over 40 languages and sold more than 20 million copies. Since its German-language publication in 2007 until today (May 2018), Byrnes' book has been in the Top 50 of Spiegel's bestseller list without interruption, including in the Top 10 for over a year. Grzeskowitz obviously earns more than good money as an author, "speaker" and "coach". And the number of comparable authors and coaches is as enormous as the number of topics they cover: Books and seminars on self-optimization topics such as "emotional intelligence", "neuro-linguistic programming", "mindfulness", "soft skills", "group work", "project management", "self-knowledge", "self-confidence" and many more are a lucrative business.

In the age of neo-liberalism, people are obviously looking for answers, for explanations, for instructions for action. They experience a society in which social ties weaken, social roles become less binding and the importance of large organizations such as trade unions and churches decreases. They strive for recognition in an environment that is becoming increasingly complex and uncertain. This obviously creates a demand for orientation, which certain media and seminar offerings serve.

In addition, neo-liberal ways of thinking and behaving have become largely unquestioned normality. Optimizing oneself, feeling responsible for oneself - this has become second nature to many people in recent decades. It is taken for granted. In public and political discourses, neoliberal morality is often no longer recognizable as such. This can also be clearly seen in the guidebook literature described.

Last but not least, one should not underestimate the extent to which for many people self-optimization, "self-responsibility" and adherence to neoliberal morality are associated with a feeling of freedom. Although this is freedom in the limited, neoliberal sense, the power of this feeling is likely to be enormous. Indeed, one of the most common misconceptions about neoliberalism is that it is an authoritarian system of oppression: such a view underestimates the extent to which neoliberalism is based on consensus and consent (Schreiner 2018a). Anyone who sees how enthusiastic the audience is at the lips of the numerous self-optimization gurus in Internet films or indirect experience, for example, may gain a vague idea of this.

And yet there is no reason for excessive pessimism. No human being is only neoliberal. And the dissatisfaction with the existing conditions seems great. Even if many of the resistances that can be observed today are heading in a frighteningly wrong direction, there are also numerous examples that can give cause for optimism: From squatting and housing occupations in Spain and the USA, left-wing election successes in Portugal and left-wing near-election successes in the USA and Great Britain to militant trade union protests in France or Greece. What they have in common is that they do not accept the existing order, but rather question it rationally and challenge it collectively.

Karl Polanyi has described capitalism as a constant conflict between stronger and weaker regulation of markets, as a constant struggle between people and markets (Polanyi 1978; Schreiner 2018b). If one follows his argument, which describes developments over centuries, the current phase of neoliberalism would be one in which the market has regained the upper hand - with corresponding resistance from the people. In fact, there is a lot to be said for this assumption, and real changes can only be expected from measures of resistance. Nevertheless, Kari Polanyi Levitt rightly warns against regarding changes towards a more regulated, rational and humane economic system as a historical automatism:

"It is the distorted and misleading individualistic ideology that has long made it so difficult for modern counter-movements to resist, and it is precisely on this intellectual front that progressive and heterodox economists must do more to meet the challenge. (Polanyi Levitt/ Seccareccia 2016).