Something on the Politics of Social Engineering

Over the years here at KP I have episodically written about the impact of ideology on social order and the debates that revolve on what constitutes the “proper” way in which to organise society. In that light I have mentioned the subject of social engineering, that is, social reform projects initiated by both Right and Left-leaning governments that use public policy to influence social behaviour in pursuit of specific collective outcomes. Here I shall return to the subject, with particular reference to how it has an impact on the upcoming NZ general election.

Some readers may recall my writing about the social engineering aspects of the neoliberal projects of the 1980s-2000s in NZ and elsewhere. To recap, the practical success of neoliberalism as an ideological construct went something like this: neoliberalism started out as a Chicago School approach to macroeconomics that was premised on the belief that finance capital was the leading edge of capitalism and could therefore guide societies towards the most efficient material outcomes. Known as “monetarism” as advocated by Milton Friedman and his acolytes, it was given practical application in the authoritarian laboratory known as Pinochet’s Chile and, in less draconian fashion, NZ under the likes of Roger Douglas and Ruth Richardson. (as some will recall, Douglas and Richardson even copied some of Pinochet’s labour laws as part of their NZ reforms).

The operating premise behind the turn to monetarism was that the Keynesian welfare state had exhausted its natural limits and outlived its usefulness, leading to parasitic rent-seeking behaviours on the part of interest groups tied to bloated public bureaucracies represented by corrupt unions that also were more interested in feeding at the public trough rather than pursing the common good. In order to break the grip of this perverse alliance of leeches, a dramatic structural reform project needed to be undertaken in which the State sector was reduced in size, public good provision was privatised, union power was constrained and people were forced to look to the private sector for their immediate and long term needs (and perhaps the wants of a fortunate few).

Note that this was purely a structural project, that is, a macroeconomic effort to reshape national economies in ways that would promote efficiency and reduce waste. Rather than State managers in places like Central Banks, Ministries of Finance or Economy, investment led by international finance capital would determine those areas in the national economy into which resources were directed using neo-Ricardian principles of comparative and competitive advantage. Codified in the so-called “Washington Consensus” adopted by the World Bank and International Monetary Fund, it had severe dislocating effects on the populations in which it was applied, something that required authoritarian imposition in places like the Southern Cone of Latin America but also serious reductions in collective rights in democracies like NZ, the UK and the US.

It turns out that in order to create the “laboratory” in which neoliberal prescriptions could work as theorised by the Chicago Boys, the human subjects needed to be denied their rights via repression (state terror in the case of the Southern Cone experiments) or drastic reductions in their collective rights in the marketplace (in places like NZ). Legally speaking, both in terms of what workers/employees could address as well as with regard to their modes of representation, the overall impact of neoliberalism was a diminution of wage earner’s ability to defend their interests in the labour market (albeit without the repression in NZ that was deemed necessary in less complacent societies like Chile).

The broader idea was to use structural reform projects to break the welfare statist mould and replace it with a stripped down and leaner State focused on core areas such as defense and security while the private sector assumed de facto control of macroeconomic policy via the appointment of its representatives to State economic oversight, management and regulatory agencies. Having done so, behavioural changes in society would inevitably follow because the state-centric mindsets of the welfare state era would give way to more market-influenced approaches by both individuals and groups. What those changes in concrete terms might be mattered less so long as they conformed to market-driven logics.

In this view monetarist structural reforms would lead to market-dominated social logics. Everyone would become a self-interested maximiser of opportunities within the rational limits of their individual choices given the market conditions in which they operate, with the overall aggregate of choices leading to market clearance at a societal level. Reproduced over time and across generations, market-oriented public perceptions of the “proper” society would become self-fulfilling. Those who accepted the premise would succeed in life and those who refused to accept or could not cope with the individualistic focus and atomising impact of a more market-driven social order would be left behind in its wake. Eventually the societal market would clear based on the sum total of the interactions between people acting as homo economicus in the first instance, to which then could be added the ascriptive (non-material) aspects of human endeavour.

This market-oriented project has certainly succeeded in NZ, even if not by original design. The architects of the early structural reforms were focused on institutions and public policy involved in economic matters, not specifically on social behaviour. But as the influence of those reforms seeped deeper into society, accompanying cultural reforms began to be proposed. To the structural reforms of the first phase of the neoliberal project were attached superstructural addenda that helped cement its ideological grip on public perceptions and behaviour. Remember that ideology is a social construction, that is, an idea about how things should and should not be. Ideologies exist in concrete material conditions with their own historical circumstances and legacies as well as their immediate contexts. In that light, ideology specifies the relationship between the imaginary and the real and the preferred path between them (which among other things raises the notion of the perfectibility of humankind). Neoliberals have an ideological bias in favour of the individual rights and freedoms; Leftists have a bias in favour of collective responsibilities and the public good.

Neoliberals are morally agnostic when it comes to social behaviour in market societies, limiting their preferences to broader freedoms of choice for individuals in such circumstances. Leftists have a normative preference for collectively beneficial social dynamics in which individual rights and responsibilities are equitably balanced with the common good.

In that light, at the superstructural level neoliberalism is an ideology that purports to demonstrate the proper way in which human societies should be organised and how people should interact within them using unfettered property and individual rights as cornerstones of the social contract. There can be no doubt that when compared to the early 1980s pre-neoliberal period, NZ society today is largely governed by market-driven principles and market-oriented institutions. And as a result, NZ social behaviour has changed.

Rather than discussing neoliberalism and market-oriented social engineering any further, let me simply point out that it started out as a conscious structural reform project that morphed into a a way of looking at the world. That in turn led to changes in society as the impact of the structural reforms took hold and deepened over the years. Market-oriented social engineering was a product and consequence of the structural reforms rather than something that was specifically envisioned from the onset. In a sense, the social engineering aspect of neoliberalism, insofar as producing behavioural changes in society, came as a bottom-up, spontaneous response to structural reform rather than as a top-down, deliberately thought-out project that extended beyond issues of political economy.

Think of it this way. Once the nature of the game is altered (say, from cricket to basketball), so too the rules of the game change, followed by changes in who plays and the way they play the new game. It may even determine who is more likely to win. But even then, the way in which the new game is played by those favored and disfavored by the new rules may be unanticipated by those who changed it in the first place. That is the essence of the social engineering consequences of the shift from welfare statism to neoliberalism in places like NZ. They were not preordained or foretold. They just happened as a “natural” consequence or response to the market-oriented structural changes undertaken. Neoliberals are comfortable with that alone, figuring that things like the balance between comfort and security will be sorted out by the interplay of social market forces.

That is where Left social engineering projects differ, and often fail. Unlike the neoliberal approach, which focused on structural (macroeconomic) reform that eventually bubbled up through the layers of the social division of labour in civil society to become new social norms and modes of behaviour, Left social engineering projects are consciously top-down in nature. Unlike market-driven social engineering projects, which focus on the downsizing reform of State institutions and regulations in order to free up policy decision-making space and freedom of manoeuver for private interests, here the primary focus is on changing collective and individual behaviour using the regulatory State as the agent of reform.

Left-leaning social engineering is what economists call “nudging” projects, but on steroids. In this context “nudging” are efforts to make discrete policy adjustments that encourage changes in social behavior, for example, by painting hopscotch, tic-tac-toe or even rainbow arcs on staircases in transportation hubs in order to encourage healthy stair climbing rather than indolent escalator riding. However, the thrust of Left social engineering projects is large rather than small, macro rather than micro, overt rather than discrete. It is “nudging” on a grand scale, or if one were to view such projects negatively, “shoving” the body politic in a particular behavioural direction.

Leftist social engineering involves “think big” projects like the recent “Zero Road Toll” land transportation campaigns or the move to replace automobile lanes with cycle and bus lanes in urban centres (where Left-governed councils use funding from the Labour-led government to make changes to local roading systems that discourage the use of cars and encourage substitute modes like bicycles, buses and trains). They focus on inducing big behavioural changes such as the lowering of smoking rates via high taxation of cigarettes or the switch to electric cars via increased taxation on diesel and petrol cars levied in tandem with rebates on new electric car purchases. The focus is on changing behaviours, not underlying structures, in a reverse of the neoliberal approach.

What these top-down Left social engineering projects do not do is alter the macroeconomic system as given, nor fully account for the microeconomic and unanticipated non-economic behavioural responses to their initiatives. The premise is that if policy-makers use State powers to constrain or frame certain types of human activity or behaviour via taxation, regulation, re-organisation and persuasion, then they will elicit specific types of responses. Rather than morally agnostic when it comes to outcomes, they are normatively-driven (aka biased) towards producing preferred collective outcomes. For example, if you narrow city streets by installing bike and busways and prohibit surface parking without increasing off-street parking spaces, the assumption is that people will abandon their cars and seek alternative modes of transportation whether they live in urban centres or commute to them. Vehicle congestion will be lowered, airborne particulate and street wastewater pollution will fall and people will get healthier by walking more and cycling.

The problem is that this does not account for the universe of car usage, to include the need to transport children and household supplies, the limited availability of disabled transportation access or presence of health issues that make cycling or access public transport difficult, the need for private vehicles for work, lack of transportation alternatives in satellite communities connected to urban employment centres, etc.

In other words, no major structural reforms are adopted, and no hedge is made against unanticipated responses to the implementation of grandiose projects. Market-led capitalism remains untouched as the core of the national economy, with modifications in tax policy nibbling around the margin of the macroeconomic model and broader behavioural changes in society encouraged–some would say imposed–by State fiat. This is the reverse of the neoliberal project, which focused on immediate structural changes and consequences and did not indulge in offering preferences when it came to longer-term social behaviours.

The results for the Left (such as it is in NZ) are often disappointing: With insufficient police resources to enforce road safety policies that are designed to reduce the road death and injury toll, the toll remains static in spite of millions spent on advertising campaigns. In places like West Auckland, ambitious traffic reduction schemes are implemented in places originally designed to attract rather than discourage car usage (e.g. around the Henderson mall and adjacent shopping areas), thereby resulting in gridlock, anger, protests, large-scale violations of the new traffic guidelines and eventual abandonment of the project altogether in the face of community resistance to the change and at a cost of millions of wasted taxpayer dollars.

The same can be said about recent approaches to water provision. The Three Waters project is designed to rationalise water rights, quality and supply by centralising managerial authority in a reduced number of districts while providing better voice for indigenous partners. However, rather than be welcome as an improvement in public good provision, what it received by way of response was both a racist backlash against improved Maori representation as stakeholders and pushback from those who see the removal of decentralised decision-making (however incompetent or inefficient it may be) as an erosion of democratic rights to self-governance when it comes to local water management.

The top-down approach to social engineering is based on one of two logics: that people will respond as required given what they have been legislatively told is in their best collective interest; or people will willingly comply with what they perceive as beneficial for the common good. The catch is that with atomising, individualistic neoliberal perspectives and logics deeply embedded throughout society in NZ, the former will be resisted or ignored and the latter will be met with non-compliance. Given the ideological influence of “legacy” market-oriented social perspectives in contemporary NZ, their impact on general acceptance of 6th Labour government social engineering projects has been deleterious to say the least.

This was seen in the reaction by NZ anti-vaccination, anti-masking and anti-mandate campaigns to the government’s pandemic mitigation efforts, where world-leading prevention, containment and mitigation strategies developed by public health professionals and epidemiologists faced concerted resistance from the business community, conspiracy theorists, rightwing political opportunists, media figures and assorted tinfoil hat “cookers” that culminated in the Parliamentary protests and riot of 2022, and which continue to percolate and be mainstreamed today. In that case a declared national emergency demanded a rapid social engineering response in the face of an immediate existential threat, and yet even then it was repeatedly challenged as an authoritarian over-reach and infringement on basic freedoms. If ever there was concrete proof that the neoliberal ideological championing of the primacy of individual choice was firmly embedded in NZ society, it was in this type of response to what was otherwise a clear case of the State acting on behalf of and defending the collective interest (specifically, public health and welfare) against a common threat.

The point of this rumination is to help understand why the current government may lose the October election. Although it objectively has had more successes than failures during very trying times, it is the combination of market-dominated macroeconomic logics, deeply rooted neoliberal social perspectives and resentment against “top-down” approaches to social engineering that has swayed public opinion against it. That, more than unearthed scandals, media “gotcha” moments or the policies of the parties themselves, seems to be the root cause behind the apparent electorate desire to replace the current government with a Right coalition in which the racist, extremist tail will wag the vacuous “moderate” dog.

That is of concern not only because it threatens to undo some of the good work of the 6th Labour government, but mostly because not all Right social engineering projects are of the bottom-up variety to begin with and all of them require a turn to some form of authoritarianism in their initial stages (as the turn to neoliberalism in NZ in the 80s demonstrates). With ACT being the ideological/dog-whistling tail on the National dog, the turn rightwards will be top-down and harsh.