Before we start, I would like to show you this image

I found this picture in a Reddit forum, it is from the user Wang Fang and it was published 6 years ago. The photo corresponds to a street in the city of Shanghai, China. I found it curious because it is a contrast between poverty and wealth. In the same space we found someone with a Ferrari along with a day labourer who lives informally, riding a bicycle where he loads goods. Although both are waiting for the traffic light to be green, but the background is what I want to talk about today.

Today I would like to criticize the neoliberal model, which is the world order and which has caused great losses for the world and for humanity in the last three decades.

First I would like to talk about poverty, which is defined as the condition of a human being who does not have enough to satisfy his needs. This problem is not a recent one, it has been present throughout the history of humanity

In ancient times, slavery meant that black people in Ancient Greece were in constant poverty, and at that time this was normal because even slaves were not taken as persons.

In the Middle Ages this was reduced, because slavery was abolished sporadically. However, because of the feudal system, a large part of the working population came into a situation of poverty, because what was produced was destined for the feudal lord.

Going back to the modern era, the capitalist system was the most present and from here I want to put the starting point to understand and criticize the neoliberal system.

After the Second World War, the geosphere needed a change. Fascist ideologies had taken off and ended up being the cause of the war.

The solution was the Yalta Conference from February 4 to 11, 1945, where the three great powers distributed the planet. On one side, Winston Churchill, Prime Minister of the United Kingdom, then there was Franklin Roosevelt, President of the United States and finally Joseph Stalin, head of state of the Soviet Union.

Since childhood, one is taught the value of sharing with others and not being envious, but I think these gentlemen went to the extreme.

It turns out that the course of the planet was decided by these 3, because they were the ones who won the war, and for that reason they knew what the world should be. Quite a strange argument, but well.

So the three of them, like they were eating pizza, divided up the planet. Roosevelt would have mostly America, England would have the Common Well and the Soviet Union would have its foreign territories, like Ukraine or Belarus.

The problem, I think, is that it was thought that the interests that these three countries had were the same as the planet, when there are different situations in each continent and especially in each country.

However, this at first as a problem, because it was fruitful. From 1949 to 1970 Europe, the United States and Japan were in the so-called thirty glorious years. The rise of the era of capitalism meant that companies were strengthened, technological innovation due to the cold war and the massive use of resources meant that several companies increased in every way.

The GDP figures increased for the power countries, although it was not the big increase in the United States, if it was much better than its increase during the world wars. That is, in economic terms this capitalism greatly favored the industrial countries, that's why they call it the 30 glorious years, because their economies were at the top.

However, this was not the situation of the rest of the planet. In America during those 30 years, although the economy was relatively calm, the markets were stable; several alternative and military movements were formed that began to alter public order. In Colombia it was the FARC, which was the first of many in the country; in Argentina there were the Montoneros and in Mexico the Zapatista Army of National Liberation, among others.

So the presence of alternative movements and others such as guerrillas generated that America was in another situation, different from the powers that be.

Since that perfect capitalism was based on the massive exploitation of resources, it was a matter of time before it exploded and could not take any more. The moment where everything collapses is the 1973 oil crisis, where the American oil reserves stopped producing. This happened to the other countries. In short, that capitalism said: Houston, we have a problem

The solution to this impending crisis had to start with the search for a new global model, which would embrace everyone. During the 1980s, neoliberalism was born

In 1990 there is a milestone in the new world order, the economist John Willamson showed the world the Washington Consensus, who wanted capitalism not to die out as if it had passed over to feudalism, but to be transformed into the demand of the global sphere.

The Washington Consensus was a 10-point document, which was thought to be the way to revive the global economy. Among these were:

1. Discipline fiscal policy, focusing on avoiding large fiscal deficits in relation to the Gross Domestic Product;

2. Redirection of public spending on subsidies ("especially indiscriminate subsidies") towards greater investment in key development points, pro-poor services such as primary education, primary health care and infrastructure; Inflation as a central parameter of the economy.

3. Tax reform, broadening the tax base and adopting moderate marginal tax rates

4. Interest rates that are market-determined and positive (but moderate) in real terms;

5. Competitive exchange rates; It is considered that the real exchange rate should be sufficiently competitive to promote export growth, while maintaining an eventual sustainable current account deficit.

6. Trade liberalization; Liberalization of imports, with particular emphasis on the elimination of quantitative restrictions (licenses, etc.); any trade protection should have low and relatively uniform tariffs;

7. Liberalization of barriers to foreign direct investment;

8. Privatization of state-owned enterprises; Foreign Direct Investment (FDI).

9. Deregulation: abolition of regulations that prevent market access or restrict competition, except those justified on grounds of safety, environmental and consumer protection and prudential supervision of financial institutions;

10. Legal certainty for property rights

11. Discipline in fiscal policy, focusing on avoiding large fiscal deficits in relation to the Gross Domestic Product

12. Redirection of public spending on subsidies ( especially indiscriminate subsidies) towards greater investment in key areas for development, pro-poor services such as primary education, primary health care and infrastructure; Inflation as a central parameter of the economy

13. Tax reform, broadening the tax base and adopting moderate marginal tax rates;

14. Interest rates that are market-determined and positive (but moderate) in real terms

15. Competitive exchange rates; It is considered that the real exchange rate should be sufficiently competitive to promote export growth, while maintaining an eventual sustainable current account deficit.

16. Trade liberalization: Liberalization of imports, with particular emphasis on the elimination of quantitative restrictions (licences, etc.); any trade protection should have low and relatively uniform tariffs;

17. 17. Liberalization of barriers to foreign direct investment;

18. Privatization of state-owned enterprises; Foreign Direct Investment (FDI).

19. Deregulation: abolition of regulations that prevent market access or restrict competition, except those justified on grounds of safety, environmental and consumer protection and prudential supervision of financial institutions;

20. Legal certainty for property rights.

On paper it sounds interesting and even hopeful. What is neoliberalism? It is an ideology that was born as a contradiction to the model of the time. Its etymology is understood as a "new vision of liberalism". From a philosophical point of view, "the founders of neoliberal thought took the political ideal of individual dignity and freedom as a fundamental pillar which they considered to be the central values of humanity".

However, from theory to practice there is a big gap

The so-called "powerhouse" countries decided that the best way to show this freedom was through the economy, where it would be "revolutionary" with economic openness and financial flexibility. "Most of the states that have taken the neoliberal turn have only partially done so; introducing greater flexibility in labor markets, deregulating financial operations and embracing monetarism there" However, this would begin to be a consequence, because neoliberalism was only thought of by countries that were economically strong. They believed that this new dynamic economy would be viable in the same way for everyone, but this was not the case.

What generated this? When the powers began to implement the economic opening and being the main channels of capital exchange, they ended up forcing the other countries to join a system that did not have their participation in deciding it and that was not in accordance with their current conditions. In other words, the states of the planet had to decide whether to join neoliberalism or to stay behind in comparison with the speed with which the world would mobilize.

The big mistake was to allow Washington to be an ambiguous concept. To assume that American interests were the same as those of the rest of the world was a complete fallacy. Because of the circumstances and degrees of historicity, not all countries could keep up with the powers that be in the economy. This then generated that those countries where there was always inequality, this continued and increased, because the speed of the economy allowed it.

In other words, while the United States was in a Ferrari, America was in a Renault 12.

An example of this was the 1983 crisis suffered by all of Latin America. In the past, the continent was not prepared for economic opening and financial freedom, but it was forced to remain unambiguous and ended up collapsing like a house of cards

For this reason, the neo-liberal ethics that were thought of at the beginning ended up being transformed into a different one. Now the concept of freedom was presented only in the economic field, where any country could participate in a fast economic system, but stipulated by the countries of the first world and not by the others. This distortion of the concept of freedom also caused several thinkers who were initially followers of the neoliberal vision, to be critical of this

In addition to forcing them indirectly to become part of the system, the powers that be persuaded them by means of aid to their social situations. An example of this was the way in which Chile changed its political structure towards a coupling with neoliberalism due to the presence of the United States in the country.

By the turn of the century, the entire planet had already embraced neoliberalism, but with consequences already present and many to come.

This fast economy generates as a consequence a massive use of resources. Today we see that this has brought havoc, because pollution is one of the main actors in the global crisis. Due to this unmeasured use, a large part of the planet has been deteriorating. There are resources that could have been renewable, but there are many that are not.

What is happening with nature is the scenario that Michael Jackson provided in his song Earth Song, which shows how human activities cause the deterioration of the ecosystem, all because we live in a neoliberal capitalist world.

Finally, I want to touch on another consequence of neoliberalism, which I consider to be the most negative. What was once thought of as an economic model, today is more than that, it is an ideology and a world order.

If we analyze the original neoliberal ethics, it stated that individual freedoms and equity would be the pillars. I ask myself almost 5 decades later, does this dogma still hold?

The world's wealth is for a few, the upper class, the same class that shared out the world after the war and that formed the Washington consensus. At the beginning it was wanted that the State did not intervene in the economy, so that there would be more flexibility and freedom, but we see how, for example, in Colombia one of the richest people in the country, Sarmiento Angulo, who has in his power big companies like the Aval group, has financed several presidents during his candidacy, to later receive attributions from the State. We see this every year in decrees that favor macro companies like these and not micro companies, which need more.

Or the Chinese economy, where the authoritarian regime ends up imposing restrictions on exports and imports in the Asian country.

In conclusion, the current neoliberal model is another period in history where the world order ends up being the cause of poverty. A model that was born as a freedom for the whole planet ends up today being an unsustainable world order, which generates that the rich get richer at the expense of the middle class and the poor. A model that is only for some and that does not meet the needs.