Neoliberalism and neoclassical economics are often terms that are used interchangeably by various economists and financial writers, but actually, there are important differences between the two. We’ve had some requests from readers to make that distinction more obvious, so Claire Connelly has summarised what you need to know.
The principal objective of the UK tax system, in which the poor pay a higher proportion of tax than the rich, is not to improve the collective well-being of society, but to funnel cash – largely through tax cuts – to the corporate elite. This isn’t free-market capitalism in the formal sense, but socialism for the rich – a form of state capitalism – no different in principle to the old statist economies of the former Soviet Union.
November 2008, Queen Elizabeth visited the London School of Economics and asked why no economist saw the financial crisis coming. Since that exchange, the realisation has dawned on many that it is the discipline of economics itself that is the problem. Until economics is fixed, mainstream economists will continue to fly blind. And we will continue to foot the bill. Economist and author of ‘Doughnut Economics’, Kate Raworth, calls for ‘an economics reformation’.