Neo Liberalism

Topics: Neoliberalism, Bolivia, Free market Pages: 5 (1579 words) Published: September 24, 2011
Neoliberalism is the ability to globally trade, prosper and develop fairly and equitably among other countries. Neoliberalism policies allow for countries to import/export goods and services, trade and settle debts among countries. “Neoliberalism policies stress privatization, export production, direct foreign investment, and few restrictions on imports” (Rowntree, Lewis, Price, & Wyckoff, 2008). There are several Latin American countries who are accepting the neoliberalism ideology; however, there are some countries like Peru and Bolivia who are not embracing the neoliberalism philosophy. “Recent protests in Peru and Bolivia reflect the popular anger against trade policies that seem to benefit only the elite” (Rowntree, Lewis, Price, & Wyckoff, 2008). This essay will discuss neoliberalism policies in depth as well as neoliberalism in Latin America. Furthermore, this essay will discuss the issues that prevent neoliberalism in Peru and Bolivia.

The intent behind neoliberalism policies is to remove control from the government and allow more freedom to the private sector. “Broadly speaking, neoliberalism seeks to transfer part of the control of the economy from public to the private sector, under the belief that it will produce a more efficient government and improve the economic health of the nation” ("Neoliberalism," 2010). Simply, the point of these policies is to provide a healthier government and allow the development of underdeveloped countries.

According to Elizabeth Martinez and Arnoldo Garcia of, “The main points of neo-liberalism include: The Rule of the Market, Cutting Public Expenditure for Social Services, Deregulation, and Eliminating the Concept of ‘The Public Good’ or ‘Community’” (Garcia, & Martinez).

The idea behind the rule of the free market is to allow the private sector to be free from governmental regulations. A free market system is beneficial because it calls for economic growth. “An unregulated market is the best way to increase economic growth, which will ultimately benefit everyone” (Garcia, & Martinez). Martinez and Garcia further discuss this idea in detail by saying, “Liberating "free" enterprise or private enterprise from any bonds imposed by the government (the state) no matter how much social damage this causes. Greater openness to international trade and investment, as in NAFTA. Reduce wages by de-unionizing workers and eliminating workers' rights that had been won over many years of struggle. No more price controls. All in all, total freedom of movement for capital, goods and services” (Garcia, & Martinez).

A perfect example of the free market is found in Chile. Chile is the most studied and watched country in Latin America due to their huge economic turnaround in the 1980’s, 1990’s and 2000’s. “Much of Chile’s export-led growth has been based on primary products: fruits, seafood, copper, and wood” (Rowntree, Lewis, Price, & Wyckoff, 2008). Chile’s economic growth has proven that neoliberalism is beneficial to a country’s wellbeing. The text book goes deeper into Chile’s economic growth. “Its average annual growth rate between 2000 and 2005 was 4.3 percent, one of the region’s healthiest. In 1995 alone, however, the Chilean economy grew 10.4 percent” (Rowntree, Lewis, Price, & Wyckoff, 2008). Although Chile’s economic outlook looks promising, the text book still does not label Chile as being a developed country because of lack of “value-added goods”.

In the continuing effort to reduce government’s role in the private sector, cutting public expenditures for social services is designed to reduce government regulation while increasing healthcare and education. Another main point of neoliberalism is “Cutting public expenditure for social services like education and health care. Reducing the safety-net for the poor, and even maintenance of roads, bridges, water supply -- again in the name of reducing government's role” (Garcia, & Martinez).

The third main point of...

Cited: Chong, Alberto, & Lopez-de-Silanes, Florencio. (2000). What are the costs and benefits of privatization in Latin America and the Caribbean?. The Latin American and Caribbean Research Network Project, Retrieved from
Evo Morales. (2010). Wikipedia, the free encyclopedia. Retrieved (2010, February 27) from
Garcia, Arnoldo, & Martinez, Elizabeth. (n.d.). What is Neoliberalism?. Retrieved from
Kelly, Laura. (2005). Neoliberalism in Latin America. The Citizens ' Press, Retrieved from
Neoliberalism. (2010). Wikipedia, the free encyclopedia. Retrieved (2010, February 29) from
Neoliberalism Deregulation. Encyclopedia of management: myths to real working time. Retrieved (2010, February 27) from
Rowntree, Lester, Lewis, Martin, Price, Marie, & Wyckoff, William. (2008). Diversity amid globalization. 2008-03-07.
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