Chaining and Unchaining Democratic Sovereignty: (Supra)National Institutions in, and Beyond, Neoliberalism

Abstract:

This article examines neoliberal political economy as a relatively consistent theoretical practice that, from its intellectual origins, aimed at creating supranational institutions to limit democratic sovereignty. It pursues this line of inquiry through a detailed account of Hayek's main intellectual contribution to the political construction of supranational institutions and through a comparison between his work and Robbins’ take on the same subject. This opens the terrain for the valorization of national sovereignty, a necessary, but not sufficient, condition to unchain democracy beyond neoliberalism.

Keywords::

• Friedrich Hayek
• Lionel Robbins
• democracy
• neoliberalism
• nationalism

JEL Classification Codes::

• B52
• B53
• F15
• P10

Notes

1 The concept of enabling myth was presented by William Dugger (1989, 608) in the following way: “Myths serve as powerful social control mechanisms, particularly in stratified societies, where they keep the lower strata in their assigned place. These myths are ‘enabling myths’, because they enable the upper strata to maintain dominance over the lower.” For recent usages of this concept to depict important facets of neoliberalism, see Mary Wrenn (2014).

2 As is common in Hayek's scientific work, the article is relatively lacking in spatial and temporal coordinates, leaving to the reader the effort to identify them. This is a strategy to be followed afterwards: combining the identification of causal mechanisms and compatible policy prescriptions at relatively high level of abstraction, thus giving the analysis a power of generalization, while trying to remain within the confines of political relevance even if only in the long run of affairs.

3 This, of course, shows the influence of the Austrian tradition of political economy, that had at the time made the stronger arguments against socialism, on Robbins.

4 Hayek tried precisely to differentiate liberalism from “laissez‐faire,” a concern that was widely shared among members of the “neoliberal thought collective” of the Mont Pelerin Society and beyond, including Robbins that together with Hayek also participated in Colloque Walter Lippman, held in Paris in 1938, one of the moments where the expression neoliberalism was first used.

5 See Streeck (2014) and other institutionalist political economists around him, particularly Martin Höpner and Armin Schäfer (2012).

6 Ironically, in 1974, Myrdal and Hayek would share the Nobel Memorial Prize in Economics. This was in the same year of the proclamation of New International Economic Order by the United Nations, the zenith of the sane version of nationalism at the international level.

Additional information

Notes on contributors

João Rodrigues

João Rodrigues is an assistant professor at the Faculty of Economics and Researcher at the Centre for Social Studies, both at the University of Coimbra. His research interests range from the history of neoliberalism to financialization in Portugal. He has published on these topics in journals such as Journal of Economic Issues, Cambridge Journal of Economics or Review of International Political Economy. The author thanks Ana Cordeiro Santos and an anonymous referee for the valuable comments and suggestions made and Susan Evans for the careful revision of the manuscript. The author also thanks Ola Inset for having organized, already in 2016, a seminar at the European University Institute in Florence, Italy, that allowed him to present a very first draft of this article. All errors and omissions are of the author's own making.