How Neoliberal Austerity Politics Exacerbates Inequality: U.S. neocolonial edition
By Chris Lowe (May 30, 2017)
I first ran across the term “neoliberal” in the context of being a scholar of Africa in the 1980s when neoliberal economists and policy makers took over the World Bank and IMF under Reagan and Thatcher, and began imposing what were known as “structural adjustment” policies on poor countries seeking to renew loans. For context, structural adjustment is what early modern autocrats and religious fanatics did to their enemies when they put them to The Rack.
Basically in return, not for debt relief, but just for debt extensions that did not get countries out of the problems they faced nor out from under the coercive power of the International Financial Institutions (IFIs) governments were called upon to privatize many public institutions, and to slash spending for other basic public services, particularly in health and education. In Africa, it quickly put an end to broad gains that had been made since independence in literacy and life expectancy, despite all of the political and proxy war and civil war travails of many African countries. The emergence of the HIV and AIDS pandemic was heightened by the consequences. The absence of effective public health infrastructure in the West African Ebola crisis a few years ago was another consequence. Effects in much of the Caribbean were similar. The approach was spread to the former Soviet Union and Soviet Bloc with “shock treatment” in the 1990s that devastated their economies while creating new corrupt and corrupting oligarchies with privatized public wealth setting up today’s authoritarian governments.
Somewhat different forms of neoliberalism have been extended in the continental U.S. and in the EU.
The key rule of neoliberalism is that debt must be repaid, no matter how odiously acquired, no matter if the debt was redirected to private benefit from its ostensible public purpose, no matter if it was promoted on false promises, and no matter the social harm it causes or the obstructions to economic growth it imposes.
What is happening in Puerto Rico resembles the neocolonial structural adjustment version. The social implications of the destruction of the University of Puerto Rico reported in this story are just devastating.