capitalism, neoliberalism

What’s in a word: Neoliberalism or capitalism?

5 minutes to read
Christian Chun

In the past twenty years or so, critically-oriented scholars in many academic disciplines, including applied linguistics, have been employing the term ‘neoliberalism’ in their research addressing its ideology, discourses, practices, and policies impacting and shaping our everyday lives through work, home, school, community, and the state.

However, the specific mentions of ‘capitalism’ have been relatively less frequent, particularly in applied linguistics. What are the affordances of employing one term over another? Does this matter?

Capitalism or neoliberalism?

Any conception and portrayal of the economy, or what Ruccio (2008) has termed “economic representations,” shape and influence “how we understand...the consequences of those representations in terms of reproducing or strengthening the existing economic and social institutions and of imagining and generating new ones” (p. 7).

Thus, whether we use the term ‘neoliberalism’ or ‘capitalism’ in describing the economic system in which we labor and produce surplus value, has important consequences because as Ruccio pointed out, there is the urgent need to consider both the role “diverse economic representations play in how...subjectivities and identities are constituted’ (p. 15), and how these representations are “produced, how they circulate, and the manner in which they are contested in sites and practices throughout society’ (p. 15).

While the term ‘capitalism’ is often contested and misunderstood as it has been shown to have multiple and conflicting meanings, sometimes within the same utterances (Chun, 2017), the definition of neoliberalism on the other hand has been widely accepted and understood by scholars in anthropology, sociology, geography, urban studies, and applied linguistics. One such example is David Harvey’ (2005) characterization of neoliberalism as “a theory of political economic practices that proposes that human well-being can best be advanced by liberating individual entrepreneurial freedoms and skills within an institutional framework characterized by strong private property rights, free markets and free trade” (p. 2).

Whether we use the term ‘neoliberalism’ or ‘capitalism’ in describing the economic system in which we labor and produce surplus value, has important consequences.

Since the 1970s, neoliberalism has become a dominant discourse in which ideologically-framed terms such as ‘flexibility’, ‘accountability’, and ‘best practices’ have infiltrated workplaces including universities in the U.S., U.K., Canada, and Australia. Watkins (2010) argued that despite neoliberalism being ‘a dismal epithet...imprecise and over-used’, it is necessary to have a term ‘to describe the macro-economic paradigm that has predominated from the end of the 1970s’ (p. 7).

If neoliberalism is a complex ‘reorganization of capitalism’ (Campbell, 2005, p. 187), then one could ask, what is gained from labeling these reorganizing dynamics as neoliberalism rather than using the term, capitalism? One argument perhaps is observation of the increasing “extension of market-based competition and commodification processes into previously insulated realms of political-economic life,” which have “accelerated, and intensified in recent decades” (Brenner, Peck, and Theodore, 2010, p. 329).

Another trend has been the accompanying attempts to deregulate and privatize formerly state-owned enterprises and de-fund social services resulting in private capital accumulation and profit by the dispossession of public wealth (Harvey, 2005). Deregulatory state policies have also included finance capital, particularly in the U.S. and U.K. 

Liberalism vs neoliberalism

However, the term ‘neoliberalism’ is not widely known amongst the general public, and is not mentioned with any regularity in mainstream media, at least in the U.S. (Chun, 2017). Perhaps part of the reason might be in the confusion between the much more understood and accepted term by the public of ‘liberalism’ with neoliberalism.

In the context of the U.S. and U.K., liberalism has traditionally meant the intervention of the state in creating and maintaining the social-welfare society, which stems from the policies of the Roosevelt administration in the U.S. during the 1930s and ‘40s in creating the New Deal, and the post-war Labour party government in the U.K.

Neoliberalism, on the other hand, does involve the state in its policies affecting the general public, but rather than aiming for a re-allocation of corporate profits in the form of sizeable taxes on them, which are re-channeled to the public good such as health care and social security, the state appropriates public money for privatized gains, such as charter schools in the U.S., and the selling of public housing to private investors and owners, as in the case of the U.K.

This freedom also extends to the employer, who has the liberty as it were to fire or let go of any employee at a moment’s notice, and often without any legal ramification in doing so.

While these practices are specific in nature and at times oppositional to one another, they nevertheless are both part and parcel of the system known as capitalism. Capitalism has a multiplicity of meanings, which are of course shaped and articulated through ideological frames, some of which have achieved common-sense hegemony.

One such example is that capitalism is ‘freedom’ – that is, the freedom to sell one’s labor power to any employer, or to set up your own business by either having capital of your own or borrowing it from a lender such as a bank or individual investors. This idea of freedom extends to also leaving any job in a capitalist society, unlike in the feudal era in which serfs were bound to their employer throughout their entire lives. Viewed in this frame, capitalism does appear to offer freedom to the individual who can exercise choice in the availability and opportunity of multiple job offerings and possibilities.

And yet, this freedom also extends to the employer, who has the liberty as it were to fire or let go of any employee at a moment’s notice, and often without any legal ramification in doing so. The decision is usually made by only the employer, without the consent or input by the entire workforce. This would appear to contradict the notion of freedom for the employees in a company in which a situation like this depends on the will and at times, whim of a singular entity, be it a lone boss, or a board of shareholders. 

Capitalism after all

My advocating the use of the term ‘capitalism’ over ‘neoliberalism’ goes beyond any semantic or epistemological argument. Although neoliberalism has its specific affordances in specifying the practices and ideologies of the past 40 years in countries such as the U.S. and U.K., the term is still largely unknown to the general public.

Why does this matter? I argue that by employing the term capitalism in its stead, it calls attention to the economic system that has been in place now for several centuries, rather than its specific phase or manifestation, be it a Keynesian state-managed capitalism in alleviating gross economic inequalities by increasing social welfare, or a neoliberal state-managed capitalism in privatizing the public domain.

At times, the implication of naming neoliberalism as the ‘culprit’ in policies and discourses (such as the entrepreneur of oneself) creates the impression that by doing away with neoliberal policy, social justice might be achieved. This is impossible if capitalism is still in place. If the system known as capitalism is named, and better understood amongst the public, a greater awareness of its injustices can be facilitated and heightened, whereas neoliberalism can serve to confuse that by its very situatedness as a stage or variety of capitalism.


Brenner, N., Peck, J., & Theodore, N. (2010). After neoliberalization? Globalizations, 7(3), 327-345.

Campbell, A. (2005). The birth of neoliberalism in the United States: A reorganisation of capitalism. In A. Saad-Fiho & D. Johnston (Eds.), Neoliberalism: A critical reader (pp. 187-198).London: Pluto Press.

Chun, C. W. (2017). The discourses of capitalism: Everyday economists and the production of common sense. London: Routledge.

Harvey, D. (2005). A brief history of neoliberalism.New York: Oxford University Press.

Ruccio, D. F. (2008). Introduction: What are economic representations and what’s at stake?       In D. F. Ruccio (Ed.), Economic representations: Academic and everyday (pp. 1-31). New York: Routledge.

Watkins, S. (2010). Shifting sands. New Left Review, 61, 5-27.