Economic rationalism
|
|
Economic rationalism is an Australian term in discussion of microeconomic policy, applicable to the economic policy of many governments around the world, in particular during the 1980s and 1990s.
Near-equivalents include Thatcherism (UK), Rogernomics (NZ), and the Washington Consensus. To a large extent the term merely means economic liberalism, also called neoliberalism. However, the term was also used to describe advocates of market-oriented reform within the Australian Labor Party, whose position was closer to what has become known as the 'Third Way'.
The origins of the term are unclear. It was used used by the social historians Weber and Tawney to describe the position of those Protestants who advocated the removal of medieval restraints on usury. However, it seems likely that it arose independently in Australia, and was derived from the phrase "economically rational", used as a favorable description of market-oriented economic policies. Its first appearances in print were in the early 1970s, under the Whitlam government, and it was almost invariably used in a favorable sense until the late 1980s.
The now dominant negative use came into widespread use during the 1990 recession, and was popularised by a best-selling book Economic Rationalism in Canberra by Michael Pusey.
Economic rationalism can have positive results when the 'self-interest' is considered as the financial wellbeing of society at large. This financial wellbeing may however be at the expense of environmental and cultural considerations. Economic rationalist policy is often opposed by environmentalists, multiculturalists and others at the opposite end of the political spectrum to economic rationalists themselves.
Criticism Of
Economic rationalism is economic policy without social moral consideration, or "the view that commercial activity ... represents a sphere of activity in which moral considerations, beyond the rule of business probity dictated by enlightened self-interest, have no role to play." (Quiggin 1997)
As Margaret Thatcher famously said, "There is no such thing as society. There are individuals, and there are families."
See also
Reference
- Economic rationalism (http://www.uq.edu.au/economics/johnquiggin/JournalArticles97/Econrat97.html), John Quiggin, Professor of Economics, James Cook University, Published as: Quiggin, J. (1997), 'Economic rationalism', Crossings, 2(1), 3-12.