Milton Friedman’s 1951 manifesto defined neoliberalism as a competitive order requiring an active state.

Evidence

Although Director never himself employed the term neoliberalism in his scant few publications, his brother-in-law, Milton Friedman, did employ it self-referentially in his 1951 article entitled “Neoliberalism and Its Prospects.” Friedman’s 1951 manifesto did not seek to fully lay out a cogent doctrine of neoliberalism; instead, it pointed toward some salient features of neoliberalism and compared them to the superseded classical liberalism. According to Friedman, nineteenth-century liberals maintained that the state should restrict its activities to the preservation of order and enforcement of contracts. Friedman pejoratively labeled it a negative philosophy in which “Laissez-faire must be the rule” (1951a, 91). One glaring flaw of nineteenth-century liberalism, according to Friedman, was that “it failed to see that there were some functions the price system could not perform and that unless these other functions were somehow provided for, the price system could not discharge effectively the tasks for which it is admirably fitted” (p. 91). Hence, Friedman specified that the state must indeed play a positive role: “Neoliberalism would accept the nineteenth century liberal emphasis on the fundamental importance of the individual, but it would substitute for the nineteenth century goal of laissez-faire as a means to this end, the goal of the competitive order… . The state would police the system, establish conditions favorable to competition and prevent monopoly, provide a stable monetary framework, and relieve acute misery and distress” (pp. 91, 93). — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin, 1107

Categorization

• DEFINE: The passage gives Friedman’s own 1951 definition of neoliberalism as replacing laissez-faire with the competitive order, with the state policing monopoly and providing monetary stability.
• XREF: This early Friedman formulation connecting competition-order and state-monopoly-prevention resonates with the Freiburg Ordoliberal tradition and later ‘nobody has the right to own the state’ neoliberal doctrine — could cross-reference Ordoliberalism. — connects to: Neoliberalism advanced a political, not merely economic, case for the competitive market — Jessica Whyte, The Morals of the Market: Human Rights…, 34; Neoliberalism centered on a strong state, not the classical night-watchman state — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin: The Making…, 2145; Neoliberalism’s purported state-skepticism actually mandates a strong state — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 238 (+11 more)

Broader Connections

• Neoliberalism advanced a political, not merely economic, case for the competitive market #expands (0.85) — Jessica Whyte, The Morals of the Market, 34
• Neoliberalism differs from laissez-faire liberalism by using state intervention to create competition #corroborates (0.85)
• Neoliberalism centered on a strong state, not the classical night-watchman state #expands (0.83) — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin, 2145
• Neoliberalism activates the state for the economy rather than withdrawing it. #expands (0.82) — Wendy Brown, Undoing the Demos, 106
• Neoliberals pursued an engineered order rather than expecting free markets to emerge naturally #corroborates (0.82) — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin, 1907
• Neoliberalism’s purported state-skepticism actually mandates a strong state #corroborates (0.80) — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 238
• Hayekian neoliberalism requires active rule-design to insulate markets from politics #expands (0.80) — Jessica Whyte, The Morals of the Market, 360
• Neoliberalism seeks to strengthen rather than shrink the state #corroborates (0.80) — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin, 2128
• Neoliberalism seeks to transform and take over the state, not shrink it #expands (0.78) — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 117
• Neoliberalism pivoted from the economy to the framework encasing it #expands (0.75) — Quinn Slobodian, Globalists, 88
• The economy functions as model, object, and project of neoliberal state rationality. #expands (0.72) — Wendy Brown, Undoing the Demos, 107
• Friedman deliberately balanced utopian ideals against incremental politically feasible proposals #expands (0.72) — Angus Burgin, The Great Persuasion, 493