Diagnosing the British economy
The second aspect of the IEA’s critique of Keynesianism took shape in response to the historical circumstances of the early 1970s. During this period, IEA authors launched what might very well be described as their own critical history of the present. That is to say, quoting Foucauldian philosopher Colin Gordon, that criticism was practised by all these writers as genealogy: as ‘a historical investigation into events that have led us to constitute ourselves and recognize ourselves as subjects of what we do, think and say’.2 For Gordon, genealogy had last been practised in the 1930s and 1940s by figures on the Right, such as Hayek and Rüstow, and on the Left by Theodor Adorno, Walter Benjamin and Karl Polanyi. All these authors had written in various and very different ways about the collapse of classical liberalism into depression, fascism and war. This is not to claim that Britain in the 1970s was facing catastrophe on the same scale as Germany in the 1930s. But with the advent of economic crisis and high levels of inflation in Britain in the 1970s, many IEA authors came to adopt a narrative that explained the crisis historically, as a failure of so many to adapt their attitudes and conduct to the present times. Far too few people in Britain were, so the argument went, identifying and constituting themselves first and foremost as consumers. In this narrative, habits of thought had become misaligned to social reality and methods of government had, they believed, produced conduct not commensurate with progress. However to adopt this history required neoliberals to recognize that the economy was not made up of sovereign consumers, as had been previously assumed. In resolving this tension IEA authors invoked a critical history with a remarkably social and evolutionary tone.