As economic policy, neoliberalism appears in the form of market based reforms like deregulation, privatization, and austerity. When Bill Clinton repealed the Glass-Steagall Act which allowed commercial and investment banks to join together who were originally separated due to the speculation of people’s money leading to the Great Depression, ~neoliberalism~. When the European Union, European Central Bank, and the IMF forced Greece into austerity during the Greek government-debt crisis triggered by the Great Recession as a way to enforce repayment of loans given to them, ~neoliberalism~. When Margaret Thatcher, prime minister of the UK from 1979 to 1990, privatized nationalized industries like gas, water, electricity, and the British Steel Corporation allowing for these natural monopolies to pay out dividends in the millions per year to private shareholders, ~neoliberalism~. I think you get the point.
In his 2009 book Capitalist Realism: Is There no Alternative (if you haven’t read it, I would HIGHLY recommend reading this book), the late Mark Fisher uses the concept of capitalist realism to summarize the general societal feeling that “it is easier to imagine an end to the world than an end to capitalism.” He describes the phenomenon of how neoliberalism, which he succinctly defines as the “fetishisation of markets,” has infected the mindset of Western society around popular culture, work, and even mental health.
He argues that this is a conscious attempt by the bourgeoisie to legitimize the underlying logic of neoliberalism. This helps make the general population accept this particular form of Capitalism not only as an economic concept, but also as the prevailing model for a person’s relationship with a myriad of institutions, making it difficult to coherently fight against it. We are all atomized individuals acting only in the benefit of ourselves and every facet of life, including friends and dating should be seen through the lens of market logic. Any act of rebellion and Capitalism somehow finds a way to make money off of it because what else is there in life besides making money? Life is but a collection of different markets intersecting with each other and only those who are able to provide the best goods at the best price deserve to survive and thrive.
Did I mention neoliberal policies caused the Great Recession?
The point I want to make here is that for at least those of us living in Western industrialized countries, neoliberalism and its effects are all around us. The media orgasms in ecstasy when stock markets grow and sounds the alarm bells of recession when it falls even though only half of Americans own any stock and the top 1% of households own 50% of all stocks. It’s the reason why the venture capital firm SoftBank, funded by Saudi royal family money, just kept throwing billions of dollars at WeWork and its insane founder as it hemorrhaged money hoping it would become a tech company when it was just a workspace realtor. It’s the libidinal belief that the invisible hand will give you a nice tugger while you invest in penny stocks. And the dorks of Crypto World are no exception.
Let’s keep in mind that right libertarianism and neoliberalism are different sets of beliefs in that they disagree on the topic of state intervention into the economy, but everything else they agree on for the most part. Free Markets = Good and Socialism = Bad. Capitalist realism has no doubt influenced cryptocurrencies and the blockchain space. If you’ve perused r/buttcoin you’ll know there’s plenty of examples of crypto fans making wildly high price predictions for their favorite cryptocurrency based on “technical analysis” or TA for short, in hopes of kick starting another crypto bubble bigger than the previous one only to be horribly wrong. Throughout the subreddits for cryptocurrencies that benefitted from the last bubble, you’ll find posts of sports cars with license plates telling people to “HODL” their chosen cryptocurrency if they want to achieve similar levels of wealth.
Neoliberalism is one hell of a drug
Bitconnect and Carlos Matos
The crypto wealth gospel preaches that if you just believe in the market hard enough (and do some due diligence), your crypto investments will help you reach Anarcho-Capitalist Bitcoin Heaven. One of the most famous stories in Crypto World of this ideology in action is the infamous Carlos Matos.
Bitconnect was a lending platform that allowed users to lend their bitconnect coin for a return with interest. These payouts were calculated by a mysterious trading bot that told users how much money they were making daily. Spoiler alert: it was way higher than it actually was. To make a long story short, it ended up being a Ponzi scheme and investors lost a lot of money as the value of the bitconnect coin fell from a high of $500 to below $1. However the most capitalist realism-est moment of all was during the first (and last) annual bitconnect conference in 2017 held in Thailand.
A man named Carlos Matos gave a presentation (if you can call it that) where he started by yelling into the mic “WASA- WASA- WASA- WASA- WASSUUUUUPPPP BIIIIIIIITCONNEEEEEEEECT!!” and then oscillating between the “unbelievable” amounts of money he’s made from the bitconnect lending platform and how “faith and belief” in bitconnect was the only thing they needed to “change this entire world.” Essentially the personification of Neoliberal Elmo after he inhales a heart attack inducing amount of cocaine. Watch the video at your own discretion.
It was not long after that the bitconnect house of cards fell along with presumably most of the money that Carlos and other duped investors had given to the project. By the end of it all, an amount equaling in the billions was wiped from existence. Oh if only they had more faith and belief! But the market had decided their fates and therefore to everyone else, under the logic of the market, investors deserved it.
The spiritual center of the industry needs to go REALLY FAR LEFT
The ICO Bubble
Bitconnect is just one example among many Initial Coin Offerings (ICOs) that saw investors scammed of money. If you were paying attention to Crypto World or for some masochistic reason you watched “business and investment” TV channels geared towards boomer C-suite executives and College Republicans in 2017, you probably heard about the ICO bubble. An ICO is kind of similar to an Initial Public Offering (IPO), which is when the owners of a privately owned company wants to make a boat load of money and so starts selling shares of their company on a public stock exchange. Except in the case of an ICO, an organization is offering a crypto token to the public using smart contracts built on a blockchain cryptocurrency platform like Ethereum (If you want to learn more about smart contracts, check out Part 2 of my Blockchain 101 for Socialists series).
Keep in mind that ICOs are inherently different than IPOs largely because of the platform being used to raise capital (i.e., a purely digital blockchain vs. a stock exchange). Due to the inherent properties of blockchain, it is so easy to do that anyone can have an ICO, even one based purely on a whitepaper for using blockchain to communicate with Jesus or to incentivize people to read the bible, and people will give you money in the form of other cryptocurrencies. There is no State authority to say no to you unless you’re a licensed company and they probably couldn’t stop all of them if they tried. Only market mechanisms would be able to protect the masses from being scammed… This triggered sucker hunting season –err I mean the ICO bubble.
So is There no Alternative?
I know it may feel good to laugh at and ostracize those that believed the lies told to them by ICO scammers, but this would be feeding right into the jaws of neoliberalism. It further legitimizes the overreach of capitalist realist thinking and nihilism seen on the Left. We know that capitalism makes the world hellish to the point of absurdity for most by feeding lies to people using market logic so we cannot choose to also use market logic as a legitimate reason for disliking something or someone. People are frustrated with the status quo and are looking for alternatives. Cryptocurrencies happen to represent one of those alternatives that could possibly transport them out of their shitty lives, they just don’t know that it’s Capitalism that’s making it shitty. We instead need to be imagining an alternative to Capitalism. There are very obvious criticisms that we can make about ICOs as I’ve shown above but there could also be real reasons to use elements of ICOs for an anti-capitalist blockchain project.
Let’s be like Gritty and work to destroy neoliberalism
The biggest reason to start an ICO is to raise capital similar to an IPO, however how an ICO token could be used is much less restricted than a normal share from the stock market. It can do similar things like be used to claim rights on profits made by an organization like dividend payouts except in an automated way. The token could have some sort of utility in relation to the project like voting on changes to the protocol, or used to perform specific actions on a platform hosted on a blockchain. These tokens don’t have to be just like a normal company stock or a cryptocurrency for transactions like Bitcoin. It’s an interesting hybrid that if applied with some creativity and anti-capitalist theory, could actually be used to allow for more economic democracy and freedom for the working class.
So now what if instead of using crypto tokens purely capitalistic gain, we took advantage of its technological capabilities to make it easier for people to participate in a democratically controlled economy. ICOs could be an option for raising funds for a platform cooperative (one of the biggest issues for cooperatives is raising early-stage capital) or a new socialist political group without needing to rely on the State. Once the ICO is done, the tokens will then be given out to members automatically to allow for easy access to voting on matters concerning their organization or cooperative. A blockchain offers a sandbox of different technical capabilities that the Left can seize to develop novel structures of democratic governance without the influence of market logic. If you want to read about more detailed examples of anti-capitalist use cases that the Left could use blockchain for, check out Part 3 of my Blockchain 101 for Socialists series.
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