Abstract
The United Kingdom and the United States have often been presented as the leaders of a neoliberal revolution that allegedly took place in the 1980s. At this time, Margaret Thatcher and Ronald Reagan both intended to put an end to post-war Keynesianism, which had consisted in using state intervention to steer markets to achieve social or economic objectives. This hands-on approach was to be replaced with free market policies inspired by the neoliberal theories of Friedrich A. Hayek and Milton Friedman. Does this mean that the British and American states have ceased to steer markets since the 1980s? This article offers a comparative analysis of the changing role of the American and British states before and after the neoliberal turn of the 1980s in two key markets: finance and energy. Empirical analysis of the major policy shifts that have taken place in these areas since the mid-20th century tend to reveal a neoliberal form of interventionism by which the state continues to steer markets through different mechanisms. While some of these neoliberal steering mechanisms were present well before the 1980s, other steering mechanisms traditionally associated with Keynesianism have endured or resurfaced since the 1980s. This invites us to question historical periodization and the nature of neoliberalism on a transatlantic level.
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Notes
- 1.
President Reagan’s appointee to the head of the Federal Deposit Insurance Corporation (FDIC) from 1981 to 1985.
- 2.
These included in particular the Banking Act of 1933 (1933), the Securities Act of 1933, the Securities Exchange Act of 1934, the Banking Act of 1935, the Commodity Exchange Act of 1936, and the Investment Company Act of 1940.
- 3.
These institutions included, among others, the Federal Deposit Insurance Corporation (FDIC), formed in 1933 to join the Federal Reserve Board and the Office of the Comptroller of the Currency to regulate the US banking industry; the Securities and Exchange Commission (SEC), formed in 1934 to regulate the securities markets; and the Federal National Mortgage Association (Fannie Mae), a GSE formed in 1938 to raise liquidity for mortgage lending through the creation of a secondary mortgage market. A further expansion of the state apparatus came in the late 1960s and early 1970s: Gennie Mae and Freddie Mac were formed in 1968 and 1970 to join Fannie Mae in the expansion of the secondary mortgage market; and the Commodity Futures Trading Commission (CFTC) was created in 1974 to regulate the futures and options markets.
- 4.
Banking Act of 1933, Pub. L. 73-66, 48 Stat. 162 (1933).
- 5.
South Dakota and Delaware completely eliminated usury rate ceilings, allowing any bank whose credit card services were relocated there to export the absence of usury rate ceilings nationwide.
- 6.
The Fed argued that the meaning of the phrase ‘principally engaged’ used in the clause separating commercial banking from investment banking was open to interpretation.
- 7.
In February 2015, the Austrian government filed a court case before the EU Court of Justice to appeal on this decision. They argued that the Contract-for-Difference would allow EDF to engage in unfair competition with renewable energies and create market distortion in the EU markets.
- 8.
Former British Energy Minister Amber Rudd stated that ‘investing in nuclear is what this Government is all about for the next twenty years’ (Rudd, interviewed on the BBC Today Programme, 23 March 2016).
- 9.
The 2017 Conservative manifesto thus pledged to set a cap on energy prices—a strategy previously sponsored by former Labour leader, Ed Miliband.
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Smith, B., de Carvalho, L. (2020). Have States Stopped Steering Markets? Rethinking Neoliberal Interventionism and Periodization in the United States and the United Kingdom. In: Dawes, S., Lenormand, M. (eds) Neoliberalism in Context . Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-030-26017-0_5
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