The social market economy originated inside the neoliberal family, not against it

Evidence

Half a century later and after two devastating wars, the original model of a social market economy continued to display these ambiguities: ordoliberal economists, the German members of the larger neoliberal family of thought, conceived the social market economy in order to offset what they considered to be dangerous trends in the postwar economy. In light of the contemporary misunderstanding of the character of the original social market economy, it is difficult to explain why German trade unions, Social Democrats, and communists fought Ludwig Erhard’s efforts to institutionalize the social market economy, why Margaret Thatcher propagated the German model on her way into Downing Street (Cockett 1994), and why Milton Friedman recommended the German model to Chile’s dictator Pinochet after the coup (see Fischer, Chapter 9 in this volume). — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin, 498

Categorization

• XREF: Connects to the reader’s working thesis that the social market economy was a member of the larger neoliberal family — a key corrective in foundational neoliberalism historiography. — connects to: The social market economy label was emptied of its original neoliberal meaning — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin: The Making…, 558; Mont Pèlerin neoliberalism framed market economy as governed by an elite citizenry’s social conscience — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin: The Making…, 1306; The social market economy label legitimized market reforms politically — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin: The Making…, 550
• QUESTION: Why would unions and Social Democrats fight Erhard’s social market economy, and why would Thatcher and Friedman simultaneously endorse it? This puzzle is the chapter’s structuring question.

Broader Connections

• The social market economy label was emptied of its original neoliberal meaning #responds-to (0.85) — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin, 558
• The social market economy label legitimized market reforms politically #expands (0.80) — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin, 550
• Mont Pèlerin neoliberalism framed market economy as governed by an elite citizenry’s social conscience #corroborates (0.75) — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin, 1306