Libertarianism is corporate propaganda and neoliberalism is its sociopolitical agenda

By equating freedom with free markets, libertarianism provides ideological cover for the practical program of restructuring governments to entrench corporate power

Milton Friedman: The most influential corporate advocate of the 20th century

I recently wrote a post trying to summarize the slippery concept of neoliberalism in 100 words (this post will be longer, apologies in advance). My takehome message from that post was that neoliberalism is essentially a corporate program of influencing government policy in favor of corporate profits.

This definition of neoliberalism is, admittedly, a practical one focused on the social and economic impacts. Neoliberalism as an ideology or political philosophy is much more difficult to pin down. In fact, there seems to be little consensus as to what neoliberalism as a philosophy consists of, with hundreds of books and articles exploring this subject from a number of different angles. Neoliberalism is clearly in favor of the free market and at least rhetorically if not in practice is against government interference in economic matters. It has taken evolving and inconsistent positions on many social issues.

But it is slippery. For example, the essay on neoliberalism in the Stanford Encyclopedia of Philosophy is a convoluted and tortured exercise in trying to find some type of defining thread in the writings of three of neoliberalism’s greatest exponents, Friedrich Hayek, Milton Friedman, and James Buchanan.

The reason for this difficulty becomes clear if we look at the relationship between libertarianism and neoliberalism. These positions overlap significantly, to the point where finding substantive and consistent differences can be difficult. An online article that tries to explain the differences comes off as comical in how little difference there is. A similarly confusing attempt trying to differentiate libertarianism from neoliberalism on a more philosophical footing can be found here.

People have better luck when trying to define neoliberalism in terms of its policy objectives. Naomi Klein stated that the three policy pillars of neoliberalism are 1) privatization of the public sector, 2) deregulation of the corporate sector, and 3) tax cuts for corporations, paid for by public spending cuts.

If we analyze the political strategies and policy goals that have taken place during the neoliberal era, this definition works quite well. Much better than trying to find a coherent philosophical theme running through the writings and public statements of the so-called neoliberals.

This is no coincidence. The reason that neoliberalism is so hard to pin down ideologically is because it is not a coherent ideology. It is a sociopolitical strategy that has the goal of increasing and entrenching corporate rights and power. The reason that it is so similar to libertarianism is because it uses libertarianism as a cover for its explicitly corporate agenda. In other words, libertarianism provides a pseudo-philosophical/moral/political foundation from which to argue that neoliberalism is more than a nakedly corporate sociopolitical agenda.

Libertarianism is actually the perfect cover, because, as shown by Naomi Oreskes and Eric Conway in The Big Myth: How American Business Taught Us to Loathe Government and Love the Free Market, modern-day right-wing libertarianism (as opposed to the historical left-wing flavor)¹ was invented explicitly by corporations and business groups to justify their political interests. Once the message of free market fundamentalism was crafted, libertarianism was given credibility as a legitimate political philosophy by a decades-long campaign that included recruitment of public intellectuals, academics, and economists to retroactively craft an intellectual and philosophical history for what was essentially a corporate propaganda campaign. These intellectuals included some of the biggest names in neoliberal thought such as Ludwig von Mises, Friedrich Hayek, and Milton Friedman. They were supported and funded in their “intellectual” endeavors by some of the biggest corporations and wealthy interests in the US.

When the stagflation crisis of the late 1970s caused governments to lose faith in Keynesian economics, the libertarians rushed in with their policy prescriptions, which were adopted by governments around the world, most prominently in the UK and US under Thatcher and Reagan. Since then, both nominally liberal and conservative governments have adopted policy prescriptions suggested by libertarian think tanks and intellectuals, all the while solidifying the corporate hold on economies and politics the world over.

But we’re getting ahead of ourselves. Let’s break this down by starting with libertarianism.

A curious person who searches libertarianism online will find dozens of articles and thousands of words written about the topic (and that’s just on the first search page). An average reader may find their eyes start to glaze over after a few minutes due to the seemingly-complex nature of the arguments, with appeals to philosophers and thinkers from antiquity to the present day. For example, the opening blurb on the “Key Components of Libertarianism” essay on the rightwing free-market think tank (or as George Monbiot calls it, junk tank) Cato Institute’s website states

The key concepts of libertarianism have developed over many centuries. The first inklings of them can be found in ancient China, Greece, and Israel; they began to be developed into something resembling modern libertarian philosophy in the work of such seventeenth- and eighteenth-century thinkers as John Locke, David Hume, Adam Smith, Thomas Jefferson, and Thomas Paine.

Thus, “serious” libertarians (not the average person who hates the government, aka, Ron Swanson) can point to a long tradition of philosophy to justify their position. This makes critiquing the position more difficult because you have to engage on a number of levels and with a number of points. Anyone who tries to dismiss libertarianism has to seemingly face down centuries of intellectual thought and philosophy.

But the foundation of modern libertarianism was not a culmination of the thought of philosophers and intellectuals, it was a massive propaganda campaign by American business interests that started in the 1920s in response to a plan by the government of Pennsylvania for public provision of electricity. The governor of Pennsylvania, former head of the US Forest Service, Gifford Pinchot, proposed a public-private partnership to fill the need for rural supply of electricity, as the private market had not delivered. When the government’s survey report and plans were made public, revealing that the arrangement would provide electricity to more people at a cheaper cost, the National Electric Light Association (NELA) went on the offensive, recognizing the danger the plan posed to their control of the electricity sector.

They started propagating the idea that government provision of service was inefficient, costly, socialistic, and tyrannical, and that government involvement in activities that should be taken care of by free enterprise would destroy American prosperity.

This basic playbook was picked up by other business groups, such as the American Liberty League and the National Association of Manufacturers (NAM) when they felt threatened by other government interventions, particularly those associated with FDR’s New Deal. These groups, particularly NAM, realized that it was not enough to put their money into fighting government initiatives that threatened their business. They needed to change the public sentiment as well. The public was not sympathetic towards business in the early decades of the 20th century. The greed and brutality of unchecked capitalism was well known, and the human toll was very public. Businesses that fought against regulation, taxation, or government provision of services were not viewed favorably.

So businesses embarked on a decades-long propaganda campaign to change the public’s view of business and capitalism generally. The basic ideas were settled on in what became known as the Tripod of Freedom. Not surprisingly, businesses had found that the idea of freedom resonated strongly with the American public. The tripod was the ingenious idea to connect freedom of enterprise with freedom of the press and freedom of religion. By tying these two foundational freedoms to freedom of enterprise—the so-called indivisible doctrine—the argument went that any government interference in business would lead to a slippery slope to totalitarianism. Thus, free enterprise had to be protected at all costs. The government needed to stay out of “the market” which was assumed to operate on its own outside any social, cultural, or political context.

This propaganda campaign ran for decades, cost hundreds of millions of dollars, reached millions of people, relied on misrepresentations or outright lies, and included

• newspaper articles, editorials, and cartoons; leaflets, pamphlets, and dedicated newsletters and journals

• newspaper, radio, and TV advertisements and billboards

• Radio and TV programs and movies

• Public talks, seminars, and conference meetings

• Lobbying and pressure campaigns for elementary, highschool, and university textbook replacement and hiring academics to write new books

• Special targeting of Christian ministers and pastors with a “prosperity gospel” message

• Books - Little House on the Prairie and Ayn Rand’s hugely-popular pulp novels were both heavily promoted and marketed by business interests, and the popular Choose Your Own Adventure series’ focus on individualism and agency tied in nicely with the predominant free-market messaging

• Dedicated lobbying groups and research and advocacy foundations—eventually running into the hundreds globally (coordinated in the 1990s under the umbrella Atlas Network)

The campaign founded the first libertarian think tank, the Foundation for Economic Education (FEE), to be followed by hundreds more in the following decades.

The FEE is generally regarded as “the first libertarian think-tank” as Reason’s Brian Doherty calls it in his book “Radicals For Capitalism: A Freewheeling History of the Modern Libertarian Movement” (2007)… the Foundation for Economic Education was the best-funded conservative lobbying outfit ever known up to that time, sponsored by a Who’s Who of US industry in 1946.

A partial list of FEE’s original donors in its first four years includes: The Big Three auto makers GM, Chrysler and Ford; top oil majors including Gulf Oil, Standard Oil, and Sun Oil; major steel producers US Steel, National Steel, Republic Steel; major retailers including Montgomery Ward, Marshall Field and Sears; chemicals majors Monsanto and DuPont; and other Fortune 500 corporations including General Electric, Merrill Lynch, Eli Lilly, BF Goodrich, ConEd, and more.²

The campaign also brought in intellectual heft in the form of two European political economists, Ludwig von Mises and Friedrich Hayek. Both Mises and his student Hayek were staunch free-market advocates. They were especially passionate about the relationship between economic and political freedom, and argued for a strict dichotomy between free markets and totalitarianism, without considering anything in between. Governments must not be involved in the marketplace, lest society descend into a communist dictatorship.

These views were right in line with what NAM and other business interests needed to give their views the intellectual rigor and political direction they required to grow their movement and provide it with legitimacy. They arranged for Mises and Hayek to obtain appointments at New York University and the University of Chicago, respectively. They also funded the Mont Pelerin Society, widely recognized as the society where neoliberalism was born.

Mises was deemed too acerbic and intractable to be used as a public intellectual, and even though Hayek’s book The Road to Serfdom was quite successful in giving the newly-hatched libertarian movement some real intellectual bona-fides (and reached a wide audience via its brief synopsis in Reader’s Digest), Hayek was “too European” for mainstream Americans.

So the FEE brought in two young American economists: George Stigler and Milton Friedman. Stigler edited an abridgment of Adam Smith’s Wealth of Nations, conveniently omitting the sections where Smith calls for government regulation and highlights the unequal relationship between employers and laborers. Both he and Friedman also participated in an under the table deal to write propaganda for the National Real Estate lobby in 1946.

Milton Friedman’s contribution to the libertarian propaganda campaign cannot be overstated. He was the foremost proponent of capitalism among public intellectuals in the 20th century, famously arguing that “the social responsibility of business is to increase its profits.” He was the head of the Chicago School of economics, economic advisor to Presidents Nixon, Ford, and Reagan as well as brutal Chilean dictator Augusto Pinochet, author of several popular books expounding the inseparable relationship between capitalism and freedom³, host of a TV documentary, columnist for Newsweek from 1966-1983, winner of the Nobel Prize in economics in 1976, and recipient of the Presidential Medal of Freedom in 1988.

Propped up and buffed to a glossy shine by millions of business dollars, Friedman achieved an uncommon celebrity for an academic and provided the libertarian movement the star power it had lacked. Crucially, he also solidified the public’s perception of free markets and capitalism as absolutely necessary for broader freedom and the insidious nature of government intervention and bureaucracy. Capitalism and freedom were inseparable.⁴ This attitude of extreme distrust in government and lionizing of businesses and the private sector continues to this day and the libertarian movement is taken as a serious political philosophy, with think-tank pundits routinely appearing on news programs and think tanks such as the Fraser Institute publishing their annual Economic Freedom of the World report and the Heritage Foundation (of Project 2025 fame) publishing its Index of Economic Freedom.⁵

When he died in 2006, Friedman was hailed as “freedom’s greatest teacher”, the “grandmaster of free-market economic theory in the postwar era,” “perhaps the greatest economist of the 20th century,” among other accolades. The New York Times memorial wrote

Flying the flag of economic conservatism, Mr. Friedman led the postwar challenge to the hallowed theories of Lord Keynes, the British economist who maintained that governments had a duty to help capitalistic economies through periods of recession and to prevent boom times from exploding into high inflation.

In Professor Friedman’s view, government had the opposite obligation: to keep its hands off the economy, to let the free market do its work. He was a spiritual heir to Adam Smith, the 18th-century founder of the science of economics and proponent of laissez-faire: that government governs best which governs least.⁶

With the public opinion firmly on their side and the intellectual rigor of the libertarian movement established, corporate interests seized the opportunity that presented itself in the sympathetic governments of the “neoliberal era”, pushing free-market policies wherever possible. The ideological foundation for these policies comes directly from the libertarian propaganda that had been so carefully cultivated over the preceding decades. Neoliberalism is thus best understood as constituting a practical political shaping and implementation of a libertarian agenda, rather than a separate, if related ideology.

Thus, rather than being a coherent political philosophy, neoliberalism is a shifting, changing “bricolage of practice and ideas”. As shown in the book Market Civilizations: Neoliberals East and South, it has to change from country to country and government to government because corporate interests—though focused on profits as a rule—must be pursued in different ways depending on the prevalent social and political environment. That is why it feels so elusive when we try to define it ideologically as opposed to practically.

For example, neoliberalism is thought to be ideologically in favor of deregulation, but in practice, the outcome of neoliberal policy has been “reregulation”, or a rearranging of existing regulations or even implementing new regulation to suit corporate interests

So, neoliberalism has involved reregulating while claiming deregulation. However, the nature of the reregulation has been to support corporate interests generally. Environmental, health, and consumer protection laws that impose costs on corporations have been opposed by politicians who seek to ‘free the wealth creators’, while other regulations that support corporate profitability concerning, for example, bankruptcy law, data trading or corporate confidentiality are left alone or even expanded.⁷

If we try to make sense of this ideologically it’s difficult to do, but taken from the position that neoliberalism is just whatever needs to practically happen politically to enhance corporate power and profits, we have no problem. Likewise with the changing and oft-times seeming contradictory positions taken on various human rights and social issues. For example, neoliberals have taken different positions on various implementations of the social safety net and different types of welfare— sometimes supporting and sometimes opposing—as well as made common cause or been antagonistic towards certain conservative social and political positions. If we try to make sense of these contradictions from a theoretical perspective, we come up empty, but from a “whatever corporations need” perspective, we can accommodate any number of political or social moves that seem at odds. Put another way, trying to understand through only an ideological lens

underplays the significance, or even possibility, of interest-based transformation of ideas during the process of translation of ideas into practice, and the subsequent capability of this transformation of practice to inform later understandings of an idea: that is to say, that while ideas influence practice, practice also influences ideas, and powerful interests within society will work to influence both.⁸

Finally, it is important to note that with neoliberalism, the same as with libertarianism, rhetoric is king. By this I mean that businesses and special interests have honed their rhetoric to a sharp point over the years because they have learned that the public will not generally approve of a nakedly corporate agenda. But packaging policies in terms of freedom, equality, choice, etc… is much more likely to get public buy in. This is another reason why when we talk about neoliberalism, we should focus less on the rhetoric and more on the practicalities of policy and sociopolitical strategy (this is an example of a summary that does not look past the rhetoric and therefore remains superficial and incomplete). Neoliberalism works out politically just how far a libertarian/corporate agenda can be subversively pushed onto the public. But, as the old adage goes, “when someone shows you who they are, believe them”.

As the disastrous consequences of 40+ years of neoliberal policy become more clear, more people are seeing neoliberalism for the corporate agenda it is, and rejecting it. Let’s not spend any more time playing into the pseudointellectualism of libertarianism. Let’s call it what it is and has always been, notwithstanding the lies, subterfuge, and obfuscation: corporate propaganda and a corporate agenda. Nothing more.

1. https://jacobin.com/2023/04/libertarians-right-left-capitalism-socialism-mises-rand

2. https://www.truevaluemetrics.org/DBadmin/DBtxt003.php?vv1=txt00003804; https://www.alternet.org/2013/09/true-history-libertarianism-america-phony-ideology-promote-corporate-agenda#

3. Unlike his relatively careful academic work, Friedman’s public intellectualism was often misleading, historically revisionist, presented data that supported his points without including contrary examples, misrepresented the data he did present, or was flatly false. These mistakes and misrepresentations are addressed in Elton Rayak’s book Not So Free To Choose: The Political Economy of Milton Friedman & Ronald Reagan. The book, published in 1987, is out of print. Friedman’s books remain in print. See also https://libcom.org/article/capitalism-vs-freedom

4. See https://jacobin.com/2019/03/capitalism-freedom-socialism-milton-friedman-hayek for a critique of this position.

5. See https://jacobin.com/2021/10/economic-freedom-rankings-frasier-institute-peter-leeson-socialism-capitalism for a critique of these measures.

6. While this is an accurate statement of Friedman’s views, it betrays a misunderstanding of Smith’s own position, evidence of how thoroughly the propaganda campaign had flattened out any nuances that were present in classical economic thought.

7. Terry Hathaway, (2019). Neoliberalism as corporate power. Competition and Change, 4.

8. Hathaway, (2019).