lecture 1
Foucault’s Birth of Biopolitics: Creating Neoliberal Political Rationality, Brown
- Foucault -> neoliberalism: remarking of the liberal art of government
o characterized by its continuities with and modifications of liberal political and economic
theory
o its is not a unified theory but a modality of thought, governance, and a reason that is
identifiable and nameable despite its diverse components
o it coexists and interacts with other political rationalities, including the rationality of the
sovereign state, economic agents, and the governed themselves
- neoliberalism casts all social conduct in an exclusively economic frame through a specific set of
departures, modifications, and inversions of the principles of classical and neoclassical economic
liberalism:
o competition as nonnatural – government for the markets not because of the markets
o the economization of the state and of social policy – economic growth is the state’s social
policy
economic principles are the model for state conduct, the object of state concern,
and the means of governance
this leads to the economization of various social fields, including law, social policy,
and individual behavior
role of the state: neoliberalism activates the state to support market competition
and economic growth
the state’s legitimacy is tied to its ability to foster economic conditions
favorable to market principles
o competition replaces exchange; inequality replaces equality – inequality becomes legitimate
because of competition and other market principles taking hold in every sphere (including
non-economic ones)
o human capital replaces labor – all actors are considered capital, and as capital they are
rendered entrepreneurial
neoliberalism shifts the focus from labor to human capital, viewing individuals as
self-investing entities
this also contributes to the change from exchange and equality to competition and
inequality
o entrepreneurship replaces production – entrepreneurship and productivity replace the
emphasis on commodities and consumption
productivity is prioritized over product
enterprise over consumption or satisfaction
o the economization and tacticalization of law – sovereignty and law become supports for
competition, rather than rights
the rule of law is not set aside by neoliberalism, but instrumentalized for its
purposes
o the market as truth – the market itself is true, and represents the true form of all activity
o responsibilizing the state – the state conforms to the market
o political consensus replaces individuation and political contestation – permanent consensus
between seemingly individual actors (investors, workers, employees, trade unions)
lecture slides
- what/who is an entrepreneur?
o the enigma of entrepreneurship
general agreement on the value on entrepreneurship
general confusion about what entrepreneurship is
o “the owl of Minerva only flies at dusk” - only after the development of such a new field, we
can analyze it and understand what is means -> understanding of an event comes after the
event
, o it’s about the role of entrepreneurship plays in society
o the rise of entrepreneurship as a social value -> how can we reflect on what happened?
- entrepreneurship: a history
o etymology
French: to undertake a challenge
English: adventurer
high risk -> high reward (e.g., selling slaves)
o price signals, arbitrage
- Max Weber, the protestant ethics and the spirit of capitalism
o historical study about the kind of attitude to make capitalism possible
o two ideal-types of capitalist subjects
the protestant
the adventurer
o capitalism starts with protestants
Calvinism (origin of protestants)
whatever you do you must calculate costs and chances of success
deduction of predestination (by God you either go to hell or heaven)
utility maximizing agent
homo oeconomicus
time is money, don’t waste it
save money and invest to earn more
capital funds start to appear and after some time system is running by itself
-> adaptation
capitalism becomes the iron cage (we all must become capitalists if we
don’t want to run out of business, even Catholics)
o has the balance shifted back to the ‘adventurer’? is entrepreneurship closer to adventurer
not to protestant?
response: ambivalent meaning of entrepreneurship today
often misused to denote the protestant
but here still is a significant adventurous capitalism today
- neoliberalism
o more a curse word than a scientific concept
o rise of neoliberalism in the early 20th century
dominance of Keynes, communism, and Nazism
some economists were critical of government interventions in the market
Hayek, Friedman, Becker, Eucken, Stigler, etc.
classical liberalism needed an update → neo-liberalism
becomes the dominant school in economics in the 1970s
* liberalism:
institutions think how to conduct world trade, international transactions
they decided to cancel all boundaries, so that capital can go freely, thinking that global economic
welfare will benefit -> everyone should open up, expand boundaries, but a lot of companies were
over-competed
* Michael Foucault gives specificity, definition
* Nazism, communism, supported by Keynes: free market order leads to a disaster; solution: government
intervention
* Keynes cycle: underconsumption -> financial crisis -> lower purchase power -> firing people -> lower market
demand -> lower supply -> firing even more people
therefore, a decrease in purchase power leads to unemployment which leads to even lower purchase power
solution: government intervention to keep purchase power high (e.g., subsidies, healthcare/unemployment
benefits, projects for hiring people, public sectors… a solution for Covid 19)
* critics of Keynes and government intervention: Mises and Hayek
, nep-liberals who thought that free market is good, but government intervention should be pushed back; if
government intervenes it influences the rest of the market (e.g., government forbade to rent out for more that
1000€ - result: no need to reinvest in apartments, effect on other sectors (no construction for new
apartments); therefore, it again needed to intervene, and so on -> it will end up in communism: it’s a road to
serfdom (totalitarian government decides about everything) -> we need updates, improvements of liberalism
to neoliberalism, which is the dominant in 1970s
o principles of neoliberalism
competition
government must impose competition to guarantee efficiency (to increase
overall quality and efficiency, prevent monopoly -> enshittification (drop in
quality of online services) - monopoly takes advantage, high prices and low
quality)
e.g. privatizing public transport, scientific research
entrepreneurship
homo oeconomicus as the model of individual behavior
o homo oeconomicus = characterization of a man in some economic
theories as a rational person who purses wealth for his own self-
interest
o the economic man is described as one who avoid unnecessary
work by using rational judgement
individuals as entrepreneurs of their own lives
calculating costs and benefits of every decision to spend time in most
efficient way
o entrepreneurship as a way of life: the neoliberal homo oeconomicus
the Chicago school and human capital theory
Theodore Schultz and Gary Becker about economic growth after WWII
passive: human characteristics as a stock of human capital ready to invest
active: individual as utility-maximizing agent (-> more protestant than
adventurer, costs and benefits)
economic imperialism
Becker: the homo oeconomicus as model for all human conduct
Goes dipper (costs and benefits explain all human behavior, economics is all
that is needed; fuck sociology, criminology, etc.
o e.g., marriage -> idea to lower transaction costs, utility maximizing
activity
o e.g., Becker on crime
o result: market equilibrium; in case of competition its just to break
even, but no more, no profit -> it wouldn’t have existed
o so, neoliberalism is just everything we don’t like about free markets?
no, neoliberalism is a specific form of economic government that increases the
economic productivity of the population by imposing competition and encouraging
individuals to conduct themselves as entrepreneurs of their own human capital
- limits of the homo oeconomicus (do we really act as a homo oeconomicus?)
o cognitive biases
bias: systemic distortion of reasoning leading to irrational choices
Kahneman: system 1 and system 2 thinking
e.g., confirmation bias, implicit racial/gender bias
o information deficits
the future is largely unknowable
information acquisition is a transaction cost
acting in a milieu of uncertainty
animal spirits (Keynes)
opportunities for adventure (entrepreneurship)
o the problem of profit
Foucault’s Birth of Biopolitics: Creating Neoliberal Political Rationality, Brown
- Foucault -> neoliberalism: remarking of the liberal art of government
o characterized by its continuities with and modifications of liberal political and economic
theory
o its is not a unified theory but a modality of thought, governance, and a reason that is
identifiable and nameable despite its diverse components
o it coexists and interacts with other political rationalities, including the rationality of the
sovereign state, economic agents, and the governed themselves
- neoliberalism casts all social conduct in an exclusively economic frame through a specific set of
departures, modifications, and inversions of the principles of classical and neoclassical economic
liberalism:
o competition as nonnatural – government for the markets not because of the markets
o the economization of the state and of social policy – economic growth is the state’s social
policy
economic principles are the model for state conduct, the object of state concern,
and the means of governance
this leads to the economization of various social fields, including law, social policy,
and individual behavior
role of the state: neoliberalism activates the state to support market competition
and economic growth
the state’s legitimacy is tied to its ability to foster economic conditions
favorable to market principles
o competition replaces exchange; inequality replaces equality – inequality becomes legitimate
because of competition and other market principles taking hold in every sphere (including
non-economic ones)
o human capital replaces labor – all actors are considered capital, and as capital they are
rendered entrepreneurial
neoliberalism shifts the focus from labor to human capital, viewing individuals as
self-investing entities
this also contributes to the change from exchange and equality to competition and
inequality
o entrepreneurship replaces production – entrepreneurship and productivity replace the
emphasis on commodities and consumption
productivity is prioritized over product
enterprise over consumption or satisfaction
o the economization and tacticalization of law – sovereignty and law become supports for
competition, rather than rights
the rule of law is not set aside by neoliberalism, but instrumentalized for its
purposes
o the market as truth – the market itself is true, and represents the true form of all activity
o responsibilizing the state – the state conforms to the market
o political consensus replaces individuation and political contestation – permanent consensus
between seemingly individual actors (investors, workers, employees, trade unions)
lecture slides
- what/who is an entrepreneur?
o the enigma of entrepreneurship
general agreement on the value on entrepreneurship
general confusion about what entrepreneurship is
o “the owl of Minerva only flies at dusk” - only after the development of such a new field, we
can analyze it and understand what is means -> understanding of an event comes after the
event
, o it’s about the role of entrepreneurship plays in society
o the rise of entrepreneurship as a social value -> how can we reflect on what happened?
- entrepreneurship: a history
o etymology
French: to undertake a challenge
English: adventurer
high risk -> high reward (e.g., selling slaves)
o price signals, arbitrage
- Max Weber, the protestant ethics and the spirit of capitalism
o historical study about the kind of attitude to make capitalism possible
o two ideal-types of capitalist subjects
the protestant
the adventurer
o capitalism starts with protestants
Calvinism (origin of protestants)
whatever you do you must calculate costs and chances of success
deduction of predestination (by God you either go to hell or heaven)
utility maximizing agent
homo oeconomicus
time is money, don’t waste it
save money and invest to earn more
capital funds start to appear and after some time system is running by itself
-> adaptation
capitalism becomes the iron cage (we all must become capitalists if we
don’t want to run out of business, even Catholics)
o has the balance shifted back to the ‘adventurer’? is entrepreneurship closer to adventurer
not to protestant?
response: ambivalent meaning of entrepreneurship today
often misused to denote the protestant
but here still is a significant adventurous capitalism today
- neoliberalism
o more a curse word than a scientific concept
o rise of neoliberalism in the early 20th century
dominance of Keynes, communism, and Nazism
some economists were critical of government interventions in the market
Hayek, Friedman, Becker, Eucken, Stigler, etc.
classical liberalism needed an update → neo-liberalism
becomes the dominant school in economics in the 1970s
* liberalism:
institutions think how to conduct world trade, international transactions
they decided to cancel all boundaries, so that capital can go freely, thinking that global economic
welfare will benefit -> everyone should open up, expand boundaries, but a lot of companies were
over-competed
* Michael Foucault gives specificity, definition
* Nazism, communism, supported by Keynes: free market order leads to a disaster; solution: government
intervention
* Keynes cycle: underconsumption -> financial crisis -> lower purchase power -> firing people -> lower market
demand -> lower supply -> firing even more people
therefore, a decrease in purchase power leads to unemployment which leads to even lower purchase power
solution: government intervention to keep purchase power high (e.g., subsidies, healthcare/unemployment
benefits, projects for hiring people, public sectors… a solution for Covid 19)
* critics of Keynes and government intervention: Mises and Hayek
, nep-liberals who thought that free market is good, but government intervention should be pushed back; if
government intervenes it influences the rest of the market (e.g., government forbade to rent out for more that
1000€ - result: no need to reinvest in apartments, effect on other sectors (no construction for new
apartments); therefore, it again needed to intervene, and so on -> it will end up in communism: it’s a road to
serfdom (totalitarian government decides about everything) -> we need updates, improvements of liberalism
to neoliberalism, which is the dominant in 1970s
o principles of neoliberalism
competition
government must impose competition to guarantee efficiency (to increase
overall quality and efficiency, prevent monopoly -> enshittification (drop in
quality of online services) - monopoly takes advantage, high prices and low
quality)
e.g. privatizing public transport, scientific research
entrepreneurship
homo oeconomicus as the model of individual behavior
o homo oeconomicus = characterization of a man in some economic
theories as a rational person who purses wealth for his own self-
interest
o the economic man is described as one who avoid unnecessary
work by using rational judgement
individuals as entrepreneurs of their own lives
calculating costs and benefits of every decision to spend time in most
efficient way
o entrepreneurship as a way of life: the neoliberal homo oeconomicus
the Chicago school and human capital theory
Theodore Schultz and Gary Becker about economic growth after WWII
passive: human characteristics as a stock of human capital ready to invest
active: individual as utility-maximizing agent (-> more protestant than
adventurer, costs and benefits)
economic imperialism
Becker: the homo oeconomicus as model for all human conduct
Goes dipper (costs and benefits explain all human behavior, economics is all
that is needed; fuck sociology, criminology, etc.
o e.g., marriage -> idea to lower transaction costs, utility maximizing
activity
o e.g., Becker on crime
o result: market equilibrium; in case of competition its just to break
even, but no more, no profit -> it wouldn’t have existed
o so, neoliberalism is just everything we don’t like about free markets?
no, neoliberalism is a specific form of economic government that increases the
economic productivity of the population by imposing competition and encouraging
individuals to conduct themselves as entrepreneurs of their own human capital
- limits of the homo oeconomicus (do we really act as a homo oeconomicus?)
o cognitive biases
bias: systemic distortion of reasoning leading to irrational choices
Kahneman: system 1 and system 2 thinking
e.g., confirmation bias, implicit racial/gender bias
o information deficits
the future is largely unknowable
information acquisition is a transaction cost
acting in a milieu of uncertainty
animal spirits (Keynes)
opportunities for adventure (entrepreneurship)
o the problem of profit
