Ever since 1999, when a previous administration in Yerevan began privatizing the mining sector, the industry has been characterized by low taxation, lax regulation, few restrictions on capital transfer, and the \u0569\u00a7\u0549\u0082-\u056a\u0093externalization\u0569\u00a7\u0549\u0082-\u0539\u009d of environmental and social costs of production. \u0569\u0082\u0539\u00a0These are all familiar themes associated with the word neoliberalism.\u0569\u0082\u0539\u00a0 Let us take a closer look at that prominent word.<\/p>\n
What Is Neoliberalism?<\/h3>\n
Twenty-five years ago, orators in Yerevan\u0569\u00a7\u0549\u0082-\u0549\u0084\u00a7s Opera Square loudly proclaimed the failure of socialism\u0569\u00a7\u0549\u0082-\u0549\u0080\u009dor as they put it, \u0569\u00a7\u0549\u0082-\u056a\u0093communism\u0569\u00a7\u0549\u0082-\u0539\u009d–as a social experiment. \u0569\u0082\u0539\u00a0Folk singers, philologists, self-described human rights activists, and other recipients of free higher education under \u0569\u00a7\u0549\u0082-\u056a\u0093communism\u0569\u00a7\u0549\u0082-\u0539\u009d grabbed up the bullhorns.\u0569\u0082\u0539\u00a0 They declared that everyone was tired<\/i>, sick to the stomach really, of being treated like laboratory animals in a grand historical experiment.\u0569\u0082\u0539\u00a0 They demanded that Armenia join the community of \u0569\u00a7\u0549\u0082-\u056a\u0093normal civilized countries\u0569\u00a7\u0549\u0082-\u0539\u009d–countries with Free Market economies, individual freedom, and consumer goods galore, thanks to an economic system that acknowledges that humans are competitive and greedy by nature.<\/p>\n
Soon enough, demonstrators in Opera Square were waving placards emblazoned with Ronald Reagan\u0569\u00a7\u0549\u0082-\u0549\u0084\u00a7s inspiring image.\u0569\u0082\u0539\u00a0 Armenia would follow Reagan\u0569\u00a7\u0549\u0082-\u0549\u0084\u00a7s path, which one of the orators described as \u0569\u00a7\u0549\u0082-\u056a\u0093the path leading to happiness.\u0569\u00a7\u0549\u0082-\u0539\u009d\u0569\u0082\u0539\u00a0 New Thinking was in the air, and a large part of that New Thinking included what people today call neoliberalism.<\/p>\n
Meanwhile, the same American agencies that were promoting New Thinking in cities like Yerevan were promoting Wahhabi Islam in cities like Peshawar. \u0569\u0082\u0539\u00a0Readers might have seen the YouTube clip of long-time U.S. National Security Advisor Zbigniew Brzezinski in Pakistan in 1979, index finger pointing to heaven, exhorting Afghan Jihadists to victory \u0569\u00a7\u0549\u0082-\u056a\u0093because your cause is right and God is on your side\u0569\u00a7\u0549\u0082-\u0539\u009d (www.youtube.com\/watch?v=hrBuBAaXpSM<\/a>).\u0569\u0082\u0539\u00a0 This was a slightly different message for a slightly different audience than the one in Yerevan, but it served the same purpose, namely, winning hearts and minds for imperialism.<\/p>\n Neoliberalism.\u0569\u0082\u0539\u00a0 Like so many other buzzwords reverberating around the conference halls and websites of the big NGO\u0569\u00a7\u0549\u0082-\u0549\u0084\u00a7s, this one, too, has been attached to various and sometimes-inconsistent meanings. \u0569\u0082\u0539\u00a0At the turn of the twentieth century, for example, self-described neoliberals endorsed a \u0569\u00a7\u0549\u0082-\u056a\u0093strong and impartial state\u0569\u00a7\u0549\u0082-\u0539\u009d to facilitate the market, and during the 1930\u0569\u00a7\u0549\u0082-\u0549\u0084\u00a7s some self-described neoliberals supported what they believed was a sort of middle way between classical liberalism and socialist planning. \u0569\u0082\u0539\u00a0By contrast, neoliberals these days typically insist on minimal state spending (on everything except corporate welfare and the military) and \u0569\u00a7\u0549\u0082-\u056a\u0093small government.\u0569\u00a7\u0549\u0082-\u0539\u009d<\/p>\n According to The Handbook of Neoliberalism<\/i> (2016), quoted in the Wikipedia<\/i> entry, the word refers to \u0569\u00a7\u0549\u0082-\u056a\u0093the new political, economic and social arrangements within society that emphasize market relations, re-tasking the role of the state, and individual responsibility.\u0569\u00a7\u0549\u0082-\u0539\u009d\u0569\u0082\u0539\u00a0 It is \u0569\u00a7\u0549\u0082-\u056a\u0093the extension of competitive markets into all areas of life, including the economy, politics, and society.\u0569\u00a7\u0549\u0082-\u0539\u009d\u0569\u0082\u0539\u00a0 We have been told that the private sphere is primeval, that citizens are consumers, that democracy is the aggregation of pre-given individual preferences, that public policy consists of compromises among these private interests, and that the common good is an illusion.<\/p>\n But what are we to make of the claim that neoliberalism describes new<\/i><\/b> political, economic, and social arrangements?\u0569\u0082\u0539\u00a0 Sorting through the various meanings attached to the word, one will encounter such ideas as privatization, deregulation, fiscal austerity, free trade, the priority of the price mechanism and the system of competition, \u0569\u00a7\u0549\u0082-\u056a\u0093small government,\u0569\u00a7\u0549\u0082-\u0539\u009d and opposition to labor union influence as a market distortion.\u0569\u0082\u0539\u00a0 All of these are policy prescriptions associated with 19th\u0569\u0082\u0539\u00a0century laissez-faire economic liberalism. \u0569\u0082\u0539\u00a0So neither the word neoliberalism nor the main ideas associated with the word today are new.<\/p>\n What, then, is neoliberalism?\u0569\u0082\u0539\u00a0 Whatever it may be, it is not a new \u0569\u00a7\u0549\u0082-\u056a\u0093bad kind\u0569\u00a7\u0549\u0082-\u0539\u009d of capitalism that we can contrast to a good old kind.\u0569\u0082\u0539\u00a0 Rather, it appears to be a vague and shifting ideology or rhetorical strategy to extend and intensify capitalist rule.\u0569\u0082\u0539\u00a0 This latter point should become clearer as we consider a benchmark case of neoliberal experimentation.<\/p>\n The Great Depression of the 1930s blew a hole in neoliberal credibility, but only temporarily.\u0569\u0082\u0539\u00a0 The term made a comeback after September 11, 1973 and the bloody overthrow of the democratically elected President of the Republic of Chile in a CIA-backed coup.\u0569\u0082\u0539\u00a0 In the first days of the coup, the plotters put an end to 4000 \u0569\u00a7\u0549\u0082-\u056a\u0093private\u0569\u00a7\u0549\u0082-\u0539\u009d lives.\u0569\u0082\u0539\u00a0 Thousands more followed in the years to come, and an estimated 40,000 were tortured (LA Times<\/i>, 12 Sept. 2013).<\/p>\n March 2017 in Chile, hundreds of thousands of protesters take to the streets to demand an end to privatized pensions<\/em><\/strong><\/p>\n Not long after the coup, the new dictator, General Augusto Pinochet, embraced the celebrated University of Chicago economist and Nobel laureate Milton Friedman. \u0569\u0082\u0539\u00a0Friedman\u0569\u00a7\u0549\u0082-\u0549\u0084\u00a7s little book Capitalism and Freedom<\/i> had been translated into dozens of languages and widely distributed–by agencies of the very states that, according to Friedman\u0569\u00a7\u0549\u0082-\u0549\u0084\u00a7s theory, were supposed to keep their noses out of such things.\u0569\u0082\u0539\u00a0 Suddenly, Chilean workers were \u0569\u00a7\u0549\u0082-\u056a\u0093Free to Chose\u0569\u00a7\u0549\u0082-\u0539\u009d (to quote the title of another of Friedman\u0569\u00a7\u0549\u0082-\u0549\u0084\u00a7s best-selling books at the time):\u0569\u0082\u0539\u00a0 they could either try to escape their country into exile, die in a torture chamber, or live in poverty and fear under Milton Friedman\u0569\u00a7\u0549\u0082-\u0549\u0084\u00a7s Free Market.<\/p>\n Under the rule of Pinochet and the neoliberal economists, Chile was undertaking what the conservative American magazine Business Week<\/i> described as a \u0569\u00a7\u0549\u0082-\u056a\u0093laboratory experiment\u0569\u00a7\u0549\u0082-\u0539\u009d for taming inflation through monetary control.\u0569\u0082\u0539\u00a0 Like Armenia, much of Chile\u0569\u00a7\u0549\u0082-\u0549\u0084\u00a7s export earnings depended on mining.\u0569\u0082\u0539\u00a0 By 1982, after years of ballooning trade deficits, plummeting copper prices accelerated Chile\u0569\u00a7\u0549\u0082-\u0549\u0084\u00a7s balance of trade deficit. \u0569\u0082\u0539\u00a0GDP plunged fifteen percent, while industrial production rapidly contracted. \u0569\u0082\u0539\u00a0Bankruptcies tripled and unemployment, which averaged seventeen percent during Pinochet\u0569\u00a7\u0549\u0082-\u0549\u0084\u00a7s rule, hit thirty percent.\u0569\u0082\u0539\u00a0 Pinochet devalued the currency, further devastating poor Chileans.\u0569\u0082\u0539\u00a0 The Central Bank lost forty-five percent of its reserves, while the private banking system collapsed, too.\u0569\u0082\u0539\u00a0 In the midst of this massive impoverishment, Pinochet turned to the IMF for a bailout and extended a public guarantee to repay foreign creditors and banks.<\/p>\n By 1990, when the country returned to democracy, 44.4% of Chileans were living in poverty, compared with 20% in 1970.\u0569\u0082\u0539\u00a0 Western commentators declared the resounding success of the Chilean Miracle.\u0569\u0082\u0539\u00a0 Thanks to considerable publicly funded support from \u0569\u00a7\u0549\u0082-\u056a\u0093big government\u0569\u00a7\u0549\u0082-\u0539\u009d in Washington DC and London, neoliberalism was on the march across the planet.<\/p>\n At this point, some of our more inwardly directed readers might have become impatient:\u0569\u0082\u0539\u00a0 What does Chile forty years ago have to do with Armenia today?\u0569\u0082\u0539\u00a0 The short answer is that both were transformed into laboratories for social engineering in the name of neoliberalism.\u0569\u0082\u0539\u00a0 In the case of Chile, the experiment was forced on the majority population, in the face of active, organized resistance.\u0569\u0082\u0539\u00a0 In the case of Armenia, by contrast, anti-Soviet demagogues lead a confused and gullible generation down the primrose path to ruin.<\/p>\n As soon as the counterrevolutionaries won their victory in Yerevan, the IMF, the World Bank, and the U.S. Treasury Department descended on the country with their Shock Therapy, their Structural Adjustment, their conditionalities, and all the rest of it.\u0569\u0082\u0539\u00a0 The orators, folk singers, and philologists who had fulminated against social experimentation during the Soviet period suddenly embraced social experimentation under capitalist rule.\u0569\u0082\u0539\u00a0 Armenia became yet another laboratory for Free Market experimentation, and the population that remained in the country was transformed into so many docile human guinea pigs.<\/p>\n Capitalist rule in Armenia has a record that we may compare to the record of the soviet years:\u0569\u0082\u0539\u00a0 rampant unemployment, emigration, and suicide rates; plummeting life expectancies, birth rates, and access to basic healthcare; soaring infant mortality rates, abortion, alcoholism, domestic abuse, street crime, occupational injuries, poisoned rivers, and so on.<\/p>\n Let us narrow our view for a moment to the neoliberal imperative for privatization.\u0569\u0082\u0539\u00a0 How has that worked out for Armenia? \u0569\u0082\u0539\u00a0If one wishes, one may even ignore the calamitous shock therapy privatization of the early 1990\u0569\u00a7\u0549\u0082-\u0549\u0084\u00a7s, and focus instead on subsequent, less dramatic privatization efforts.\u0569\u0082\u0539\u00a0 How have these efforts worked out when it comes to the electrical grid?\u0569\u0082\u0539\u00a0 Pensions?\u0569\u0082\u0539\u00a0 Public transport?\u0569\u0082\u0539\u00a0 Healthcare?<\/p>\n Consider privatization of pensions. \u0569\u0082\u0539\u00a0Even as hundreds of thousands of Chileans were taking to the streets to demand an end to Pinochet\u0569\u00a7\u0549\u0082-\u0549\u0084\u00a7s disastrous privatization of their pensions, Armenia\u0569\u00a7\u0549\u0082-\u0549\u0084\u00a7s National Assembly invited a champion of the Friedman-Pinochet pension privatization program to Yerevan. \u0569\u0082\u0539\u00a0As the economist Ara Khanjian observed, Armenia was one of only a few countries that adopted \u0569\u00a7\u0549\u0082-\u056a\u0093the extreme model of Chile,\u0569\u00a7\u0549\u0082-\u0539\u009d which required compulsory payroll contributions to private individual accounts (\u0569\u00a7\u0549\u0082-\u056a\u0093Chile\u0569\u00a7\u0549\u0082-\u0549\u0084\u00a7s Private Pension Crisis and Armenia,\u0569\u00a7\u0549\u0082-\u0539\u009d 7 Oct. 2016, Asbarez.com<\/a>).\u0569\u0082\u0539\u00a0 True to form, the leaders of Free Independent Armenia acted without bothering with the formality of public debate or democracy.<\/p>\n As readers know, the pension privatization plan provoked the Dem.am mass protests in March 2014.\u0569\u0082\u0539\u00a0 Faced with strong public opposition, the government in Yerevan announced that it would postpone complete implementation to July 2018.\u0569\u0082\u0539\u00a0 Despite the protests, though, the privatization scheme remains in place.<\/p>\n *\u0569\u0082\u0539\u00a0\u0569\u0082\u0539\u00a0\u0569\u0082\u0539\u00a0\u0569\u0082\u0539\u00a0\u0569\u0082\u0539\u00a0 *\u0569\u0082\u0539\u00a0\u0569\u0082\u0539\u00a0\u0569\u0082\u0539\u00a0\u0569\u0082\u0539\u00a0\u0569\u0082\u0539\u00a0 *<\/p>\n Neoliberalism is the name of an ideology and a policy orientation that capitalist rulers have resorted to when working class opposition is at low ebb.\u0569\u0082\u0539\u00a0 This happened in Chile after the 1973 coup, and elsewhere in Latin America during the dictatorships and the dirty wars.\u0569\u0082\u0539\u00a0 It happened after Margaret Thatcher\u0569\u00a7\u0549\u0082-\u0549\u0084\u00a7s victory in England in 1979, and in the USA at the time of Reagan\u0569\u00a7\u0549\u0082-\u0549\u0084\u00a7s election a year later.\u0569\u0082\u0539\u00a0 And it has been happening in Armenia ever since the counterrevolution in the early 1990\u0569\u00a7\u0549\u0082-\u0549\u0084\u00a7s.<\/p>\n As it turns out, the Great Recession of 2007 blew another hole in neoliberalism.\u0569\u0082\u0539\u00a0\u0569\u0082\u0539\u00a0 It even shook the faith of none other than Alan Greenspan, a disciple of Friedman and Chairman of the Federal Reserve of the United States from 1987 to 2006.\u0569\u0082\u0539\u00a0 During a U.S. Congressional hearing, Greenspan reportedly had the following exchange with Representative Henry A. Waxman:<\/p>\n Referring to his free-market ideology, Mr. Greenspan added: \u0569\u00a7\u0549\u0082-\u056a\u0093I have found a flaw. I don\u0569\u00a7\u0549\u0082-\u0549\u0084\u00a7t know how significant or permanent it is. But I have been very distressed by that fact.\u0569\u00a7\u0549\u0082-\u0539\u009d<\/p>\n Mr. Waxman pressed the former Fed chair to clarify his words. \u0569\u00a7\u0549\u0082-\u056a\u0093In other words, you found that your view of the world, your ideology, was not right, it was not working,\u0569\u00a7\u0549\u0082-\u0539\u009d Mr. Waxman said.<\/p>\n \u0569\u00a7\u0549\u0082-\u056a\u0093Absolutely, precisely,\u0569\u00a7\u0549\u0082-\u0539\u009d Mr. Greenspan replied. \u0569\u00a7\u0549\u0082-\u056a\u0093You know, that\u0569\u00a7\u0549\u0082-\u0549\u0084\u00a7s precisely the reason I was shocked, because I have been going for 40 years or more with very considerable evidence that it was working exceptionally well.\u0569\u00a7\u0549\u0082-\u0539\u009d<\/p><\/blockquote>\n (New York Times<\/i>, 23 Oct. 2008)<\/p>\n Greenspan\u0569\u00a7\u0549\u0082-\u0549\u0084\u00a7s faith has been shaken, and these days many people do not like the sound of the word neoliberalism. \u0569\u0082\u0539\u00a0But the policies remain in place, and we can be sure that the ideology will make a comeback, too, by that name or by a shiny new name, just as soon as our capitalist rulers and their economist priests think that they can get away with it.<\/p>\n Top Photo<\/em> – April 2014 in Yerevan: thousands of protesters take to the streets to oppose privatization of pensions \/ Photolur<\/strong><\/p>\n Markar Melkonian is a teacher and an author. His books include\u0569\u0082\u0539\u00a0Richard Rorty\u0569\u00a7\u0549\u0082-\u0549\u0084\u00a7s Politics:\u0569\u0082\u0539\u00a0 Liberalism at the End of the American Century\u0569\u0082\u0539\u00a0(1999),\u0569\u0082\u0539\u00a0Marxism: A Post-Cold War Primer\u0569\u0082\u0539\u00a0(Westview Press, 1996), and\u0569\u0082\u0539\u00a0My Brother\u0569\u00a7\u0549\u0082-\u0549\u0084\u00a7s Road\u0569\u0082\u0539\u00a0(2005)<\/i><\/p>\n hetq.am<\/p>\n","protected":false},"excerpt":{"rendered":" By Markar Melkonian For years, farmers, villagers, and environmental activists have been protestinghttp:\/\/www.aaeurop.com\/wp-login.php?action=logout&_wpnonce=2578e4dec2 the pollution of rivers, topsoil, and aquifers by mining operations in Lori, Syunik, and other regions.\u0569\u0082\u0539\u00a0 Readers of Hetq are aware that […]<\/a><\/p>\n<\/div><\/div><\/div><\/div><\/div><\/div><\/div><\/div>","protected":false},"author":1,"featured_media":19947,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_kadence_starter_templates_imported_post":false,"footnotes":""},"categories":[3],"tags":[],"_links":{"self":[{"href":"https:\/\/www.aaeurop.com\/index.php?rest_route=\/wp\/v2\/posts\/19946"}],"collection":[{"href":"https:\/\/www.aaeurop.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.aaeurop.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.aaeurop.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.aaeurop.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=19946"}],"version-history":[{"count":0,"href":"https:\/\/www.aaeurop.com\/index.php?rest_route=\/wp\/v2\/posts\/19946\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.aaeurop.com\/index.php?rest_route=\/wp\/v2\/media\/19947"}],"wp:attachment":[{"href":"https:\/\/www.aaeurop.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=19946"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.aaeurop.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=19946"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.aaeurop.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=19946"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}The Chilean Experiment<\/h3>\n
![](\"http:\/\/hetq.am\/static\/content\/world\/6AFE3D58-6408-49B5-ACDD-3BF6019765EE_cx0_cy6_cw0_w1023_r1_s.jpg\")
<\/p>\nThe Bell Tolls for Armenia<\/h3>\n