Has the word “neoliberalism” ever come up in your conversations?
For me, this word has mostly lived on the periphery of my awareness for a long time, like maybe the last couple decades. I had some vague notion about it, but no real understanding of what it was. Then I was guesting on my friend Nicholas’s new podcast and neoliberalism came up and I realized I didn’t actually know where the term originally came from. This sent me down a rabbit hole. And this week, I need to tell you all about it because it feels like I just visited frickin’ Wonderland.
I’ve been preaching this for a while: all -isms tell you what they care about most right in their name. Capital-ism, social-ism, femin-ism. The ism basically just means “this is a belief system organized around that thing I just said.” But then we get to “neoliberalism” and… what? Neo. Liberal. Ism. In the U.S., “liberal” means left wing, government programs, social safety nets, progressive policies. So “neoliberal” sounds like a new kind of progressive… some kind of fresh Democrat? But that can’t be right, because the people who get called “neoliberals” are usually the ones cutting government programs.
So if you are in any way confused about this word — and maybe I’ve just confused you now! — or if you’re just now learning about it, welcome to the party! Because I thought I kinda knew this word, but holy crap… it is actually so much more weird and wild than I ever imagined. I’m gonna show you how this word has absolutely been messing with your life and running the world, even if it’s never come out of your mouth. Buckle up for the craziest etymology lesson you’ve ever had.
Alright, we’re gonna start by going back to where this word actually came from. Paris, 1938. Intellectuals from across Europe have gathered for something called the Walter Lippmann Colloquium. Hitler had just annexed Austria six months earlier. Now, he had his eyes on Czechoslovakia. Inside this room, economists and philosophers are trying to figure out how to save democracy.
At this conference, a German economist named Alexander Rüstow introduces a new term. He wants a label for their project, which is basically a revival of classic liberalism just updated for the 20th century. He calls it “neoliberalism.” Seems logical so far. I think the important question though here is: “What did classical liberalism mean?”
For my friends in the U.S., this is gonna be weird… classic liberalism meant free markets, limited government, and individual rights. I had no idea about this. That was the Enlightenment definition. So “neo” plus “liberal” literally just meant we’re reviving that idea of small government and free markets. Okay, simple enough, but here’s the first twist. An important somebody at the conference didn’t actually like this idea at all. Who’s that? A guy named Ludwig von Mises.
What’s weird about this is that Mises eventually becomes known as a key intellectual influence on the thing we now call neoliberalism. But in 1938, he rejected the term on the spot. Mises then spent the rest of his life championing free liberal markets in the classical sense without the “neo” label. He died in 1973. But critics of Mises in the 1970s started using neoliberalism as a catch-all term for “free market economics” and attached it to Mises, despite the Mises Institute itself continuing to distance him from neoliberalism.
As you will see, this “hot potato” situation is completely on point for this word. Ain’t nobody want this thing, but they all love to throw it at others! Mises rejects the term in 1938, spends his entire career calling himself a classic liberal, dies, then his critics retroactively make him the poster child for the thing he explicitly refused. I guess Hamilton was right… you really have no control who tells your story.
Before we go any further into this word’s wacky, bizarro history, and also our optimistic future, Let me tell you exactly what “neoliberalism” actually means in practice today.
Neoliberalism, as most people use the word today, basically describes the economic ideas that have dominated global policy from the 1980s until now. The core belief is simple, and this should feel very familiar to you: “Markets are smarter than governments.” That’s the core belief.
So if that’s the belief, the prescription’s pretty simple. Privatize public things, deregulate industries, cut taxes, especially for corporations and the wealthy, reduce social spending, break up unions, and just let competition sort everything out. You’ve felt this, you’ve lived this. This has been my entire life, literally.
Neoliberalism is why your employer stopped offering a pension and gave you a 401k instead. Your retirement is now your problem to manage in the market. It’s why healthcare in the U.S. is tied to your job, because the market, not the government, is supposed to provide. It’s why public universities got defunded and tuition costs exploded. Education’s a product you purchase, not a public good. It’s why the middle class has been eroding for 40 years while asset prices — stocks, real estate — kept climbing.
In the U.S., we sometimes call this “Reaganomics,” because it basically started with Ronald Reagan in 1981. Same ideology as neoliberalism, just, you know, with a Hollywood actor smile. But same stuff. Reagan just made it feel like “patriotism.” So, to recap… we took ideas born in a world- war- panicked- room of European intellectuals in 1938, branded it Reaganomics, stuck a cowboy hat on it, called it common sense, and then forgot where it came from. Which, honestly, might just be the most American thing that has ever happened.
So, the word “neoliberal” made coherent logical sense in 1938 in Europe. And other parts of the world still use that classical definition when it comes to the word “liberal,” which means this neoliberalism label actually has coherence still today too, just not here in the U.S.!
Why does it sound so insane here? Well, that comes down to one guy who is really good at branding things. Before the 1930s, “liberal” meant roughly the same thing on both sides of the Atlantic: free markets, limited government, individual rights. But then Franklin Delano Roosevelt needed a label for his New Deal agenda that wasn’t “socialist” (too scary!) and wasn’t “progressive” (too radical!) so he grabbed the word “liberal” and redefined it to mean “openness to government intervention in the economy.” He essentially “laundered” this word in the U.S. But Europe never made the switch. A European liberal party is to this day mostly what it was in 1938: free markets, limited government, individual rights.
Okay, just for fun, let’s throw another word in the mix: “libertarian.” You familiar with this one? This word’s I think a bit more well known in the U.S. and it has come to mean, well, basically what liberal or neoliberal still means everywhere else in the world. Are you tracking this? When other countries say “liberal” or “neoliberal,” they mean essentially what we in the U.S. mean when we say “libertarian.”
But do other countries use the word libertarian? Great question. In other places, libertarian often means the opposite of what it means in the US. Historically, especially in Europe, libertarian meant, get this, anti-capitalist, pro-worker anarchists.
You know something else, Ayn Rand, the author most people in the U.S. would associate with libertarianism, actually hated it. She openly opposed libertarianism, which she viewed as anti-capitalist. She called libertarians “hippies of the right” and said they were plagiarizing her ideas and mixing them with anarchism. She preferred to be called a “radical for capitalism,” not a libertarian. You can’t make this stuff up.
The pattern is seriously comedic in its consistency. You ready? Rüstow helps coin neoliberalism, but Mises rejects it, but then Mises gets labeled a neoliberal. FDR steals the word “liberal” and redefines it to mean something completely different just for the U.S. American free marketeers steal the word “libertarian” from European anarchists and flip the meaning because, well, they need a new label because FDR stole theirs. Europe says “neoliberalism,” the U.S. says “libertarianism” but they’re largely pointing at the same thing. Ayn Rand becomes the godmother of libertarianism while actively despising libertarians.
Every single person in this story ended up labeled something they explicitly refused or changing the meaning of words to mean the opposite of what it meant elsewhere. And nobody controlled their own narrative. Hamilton was REALLY right.
If we want to add one more great irony into this superb semantic shit show, it would have to be that nobody in the US wants to be labeled a neoliberal. The country most thoroughly shaped by this ideology is also the country least likely to call itself by this name.
I have to tell you this story. I asked my AI assistant Claude about this and said, “OK, so let me see if I understand this. So these days it’s basically like we can use neoliberalism as a slur to describe the thing we don’t want, but nobody actually claims to be part of it?” To which Claude replied, and I swear this is a direct quote, exactly: “It’s the political equivalent of whoever smelt it dealt it. Everybody’s pointing at the smell. Nobody’s claiming the fart.” Listen, when your A.I. makes a fart joke, you gotta put it in the episode. I’m pretty sure that’s a new A.I. law.
Seriously though, it seems that almost no self-identified adherents of neoliberalism exist. And the very few that do seem to be attempting some form of ironic reclamation, which is a pretty damning indictment of a word that supposedly describes the dominant global economic order of the last almost 50 years. We’ve apparently run the world on an ideology nobody will sign their name to.
By the time it gets to the 1980s, you know, Reagan cowboy time, the term neoliberalism had been thoroughly weaponized. In Chile, Pinochet’s economists use a kind of free market shock therapy to restructure their economy. And critics called it neoliberalism. Reagan and Thatcher dismantled unions, cut social programs, deregulated everything in sight. Critics called it neoliberalism, the IMF imposed structural adjustment programs on developing countries. Critics called it, you guessed it, neoliberalism. Meanwhile, none of the people doing those things called it neoliberalism. They just called it common sense or fiscal responsibility or realism.
So the neoliberal label has basically become a one-way weapon. Critics use it, but the practitioners of it deny it. Over time, it’s stopped being any kind of precise analytical term and has basically started to mean something like “an economic policy I find sinister,” which could describe anything from privatizing a national railroad to a city raising parking meter prices. Academics have been trying to rescue the word as a precise term for decades, but critics keep using it as a rhetorical flamethrower. Nobody’s winning. We’re all losing.
What we’re left with is a kind of “ghost ideology.” Enormously consequential, historically traceable, intellectually serious in its origins, but completely orphaned, and mostly used as an insult.
So at this point, I have to conclude that this word is functionally, grammatically useless. The policies exist. The track record exists. The outcomes, some good, many bad, exist. The “neoliberal” label now is basically just some kind of linguistic chalk outline. Something definitely died there, but it ain’t there anymore. And we’ve also lost the body.
Here’s today’s optimistic rebellion. Every -ism we’ve talked about today, liberalism, neoliberalism, libertarianism, started somewhere specific: a room, a person, a moment in history with real stakes and real context. And then that idea got passed around, redefined, weaponized, and eventually turned into a label that people throw at each other without much thought about where it came from or what it originally meant. And to some extent, I think we all do this.
I try to be very precise in my thinking and language, but I got sucked into this vortex in my convo with Nicholas. It’s easy to use an -ism as some kind of air cover for our opinions and half-baked statements. We adopt those -isms like they’re some sort of customizable weapon that damages only the thing we want to damage. But it doesn’t work like this.
Like we saw hopefully in this episode, these labels and words are complex and contextual in their meanings and impacts and I am challenging us, very much myself included, to be more thoughtful before we throw them around.
So this week’s optimistic rebellion is this: the next time you reach for an -ism in an argument, in a conversation, on social media, wherever, I wanna challenge you to pause for just five seconds and ask yourself, do I ACTUALLY know what this word means? Do I know where it came from? Do I know who coined it and why? And am I using it to try to understand something better or just to win an argument? Let’s be honest with ourselves if we’re wielding an -ism as a weapon or if we’re letting a belief system think for us.
Because here’s what I believe: the world doesn’t get better when we just fight harder with the same broken vocabulary. It gets better when we get more precise and more curious and more willing to say, “You know what? I actually don’t know the full history of that idea. Let me do some research.” That is not weakness. That is how we become people who can actually help the world thoughtfully build what comes next.
Original post with all source links: https://joshallan.com/2026/04/14/neoliberalism-the-word-that-runs-the-world/
