In a striking new piece of intellectual history in the Nation, political scientist Corey Robin argues that neoliberalism is haunted by Friedrich Nietzsche’s late nineteenth-century elitism. Like all ambitious histories, Robin’s genealogy of neoliberalism raises more questions than it can answer, but one is particularly enticing—the relationship between neoliberalism and its immediate historical antagonist, mid-twentieth-century liberalism. As parts of Robin’s own story suggest, liberalism and neoliberalism share more in common with each other than either does with Nietzsche’s disdain for the marketplace.
As Robin tells us, Nietzsche was terrified by the industrial conflict of the late nineteenth century. The anxious German did not fear for his own life or wealth—he had none—but for the meaning of life itself. In a world without God, Nietzsche reasoned, the creation of values depended on the existence of a cadre of “exalted men of culture in whose service everything else has to consume itself.” Value necessarily stemmed from nobility—the power of some men to force their tastes on others. And while trade unions and mass parties longed for a kind of power, they dedicated themselves not to rule in the old, noble sense but to the “dignity of work,” what Nietzsche saw as a celebration of slavishness, the disappearance of rank and value altogether. Yet even as he despised labor, Nietzsche could not ally himself with his own day’s economic elite, the titans of a burgeoning global marketplace. He saw in their power to buy and sell not the generation of noble values but only their further degradation. In place of a politics or political economy, then, Nietzsche fell back upon a kind of messianic desire, piously keeping watch for the day when new noblemen—through pure acts of will—would bring order and meaning to the chaos of the class war.
According to Robin, the politics of neoliberalism arose when a group of Austrian economists—Friedrich Hayek in particular—relocated Nietzsche’s ethereal nobility to the marketplace that Nietzsche himself had disdained. Hayek saw in the wealthy “an avant-garde of tastemakers” whose own imperious decisions about where to spend their money would gradually shape the values of the consuming masses. These “legislators of value” brought a Nietzschean prestige to inegalitarian economic policies. But there still seems to be a deep ideological divide between Hayek’s celebration of economic elites and Nietzsche’s contempt for factory-floor and marketplace, In order to bridge this gap, Robin invokes the marginalists, a group of economists who were contemporaries of Nietzsche and direct influences on the Austrian school.
These economists helped to introduce the idea that consumption, not production, was the ultimate source of the value of goods and services. At the root of value-creation, they argued, was the purely subjective estimation of a thing’s worth by an individual. By giving subjectivity the whip-hand when it came to the generation of value, these economists transfigured the marketplace into a realm of decision in which a Nietzschean could comfortably dwell. Robin argues that, like the marginalists, Nietzsche believed that “[v]alue was . . . enacted with an appraising gaze, a nod of the head signifying a matchless abundance of taste.” He just never imagined that that such an aristocratic “nod of the head” could really drive the economy, establishing noble values through market mechanisms. Friedrich Hayek did, synthesizing marginalist economics and Nietzschean elitism.
Yet, as Robin himself notes, Hayek’s elitist political economy was not the only child of the marginal revolution While many of the early marginalists were unsympathetic to the labor movement, “[b]y the twentieth century . . .many marginalists were on the left and used their ideas to help construct the institutions of social democracy.” The marginalist idea that consumption is the ultimate source of value was open to a populist as a well as an elitist interpretation, and the mid-century “welfare state, with its emphasis on high wages and good benefits—as well as unionization—as the driving agent of mass demand and economic prosperity” institutionalized the populist take on marginalism. At one point, Robin suggests that it was actually only in response to this populist interpretation that Hayek and friends crafted an elitist alternative: “The midcentury right was in desperate need of a response that, squaring Nietzsche’s circle, would clear a path for aristocratic action in the capitalist marketplace.”
In light of this story of a mid-century struggle within marginalism, Robin’s piece seems mistitled. He has given us not the rise of “Nietzsche’s marginal children” but the victory of “marginalism’s Nietzschean child.” Although this phrase wouldn’t make a very good title, it does suggest that Robin may be overplaying the Nietzschean, and underplaying the marginalist, roots of neoliberalism.
The question that occupied the mid-twentieth-century was whether the public subsidization of consumption signaled a new age of political economic equality. Social democrats and liberals answered in the affirmative, while their leftist critics warned that only worker-ownership could prevent elite domination of the masses. While the “moral economy” of liberalism may have been “workerist,” as Robin contends, the question remained whether such a moral economy would be enough to protect workers from owners in the long run. From the point of view of its left-wing detractors, then, liberalism was already dangerously elitist. It maintained a fundamental hierarchy between workers and owners. While neoliberalism weakened efforts to mediate this form of elitism, it did not invent it.
What Robin’s story does not explain is why we ended up with a more elitist rather than a less elitist form of capitalism. And it is not clear how Nietzsche helps with this explanation. There is no doubt something historically-specific and conceptually-rich about Nietzsche’s brand of voluntaristic elitism. But what distinguished Hayek’s elitism—as Robin characterizes it—from earlier and less successful forms was its belief in the moral power of consumer choice, a belief it shared with liberalism and not with Nietzsche. Early in his piece, Robin allows that “the relationship between Nietzsche and the free-market right . . . is thus one of elective affinity rather than direct influence, at the level of idiom rather than policy.” But people suffer because of policies, not idioms. Neoliberal policy was a response to liberalism, a response whose success depended on the failure of liberalism to deliver on its own moral promise.