Amy Kapczynski on how the law and neoliberalism changed each other

Amy Kapczynski is Professor of Law at Yale Law School, where she is Faculty Co-Director of the Law and Political Economy Project and the Global Health Justice Partnership. Amy also co-founded the LPE Project blog. Her research focuses on law and political economy, and theorizes the failures of legal logic and structure that condition contemporary inequality and hollowed out democracy.

In this interview, Amy explains that neoliberalism is not just an ideology but a particular form of governance that has reformatted state power. Its consequences include our unjust global health system and tech companies' structural power, which are both products of changes to pivotal areas of the law. Indeed, law has always been the “connective tissue between neoliberal ideas and governance." And as she critiques two high-profile proposals for what should succeed neoliberalism, Amy offers another salutary reminder: our next form of governance ought to be rooted in care.

How do you define neoliberalism in your work and why do you think that's the definition that makes the most sense?

I define neoliberalism as a logic of governance that is oriented to increasing the power of market actors and diminishing public authority over those actors. Wendy Brown has this lovely term, “reformatting capitalism.” It's a reformatting of capitalism broadly to not only increase the power of private actors – and therefore also their ability to extract profits – but also to disable democratic control over those actors. 

I think of it that way, as opposed to, for example, a deregulatory move. Neoliberalism is in fact quite regulatory. It's regulatory with a particular paradigm and purpose in mind. It’s important that we see the ways in which there's an overt regulation of the economy – reorienting labor law, antitrust law, other kinds of law – to optimize for a profit-seeking impulse. 

It’s also important to see that it's connected to regulatory paradigms that are manifested through the welfare state, through the carceral state, and so forth. This is not a broadly deregulatory period, particularly in American life.

Sticking to this definition of neoliberalism as a kind of logic, which you explore in your excellent conversation with Wendy Brown, have there been some changes within that logic in the last ten or 15 years? Or has it been more or less consistent since the 1970s? Has something distinct appeared on the horizon, perhaps with the rise of Big Tech?

Neoliberalism has in some ways suspended older forms of legal regulation for Big Tech, and then amplified aspects of the profit-seeking motive – and this has produced something quite extraordinary. These tech intermediaries, from the social media landscape to Amazon, have control over public life and the economy in ways that are distinctive and new. 

But I don’t think these changes reflect a shift in the logic of neoliberalism itself, so much as reveal its implications when applied to a sector that can be transformed at the speed of software. Today, the processes that neoliberalism sets up can operate very, very fast. And the ability of these forms of concentrated power to crisscross the ostensibly public and private domains is quite extreme.

Would you say that this logic has become more or less legitimate over the last decade? More or less appealing? Does all the talk about neoliberalism reflect some shifts in the popular mood?

In the US, there were real inflection points around the financial crisis of 2008, with increasing awareness of the concentration of inequality, both wealth and income, as well as racialized, gendered inequality. Then, with the rise of Occupy – and taking an even sharper form with the election of Trump – you start to see concern for the implications that neoliberal policies have had for our lives. They have had implications for our economy and also our democracy, our ability to govern ourselves.

This reaches beyond our borders as well. Broadly, the concern about the rise of authoritarian governments dovetails with the success of movements around climate change to bring more attention to the contradiction between neoliberal capitalism and the future of the planet. Together, these concerns – about inequality, the conditions of the contemporary working class, the destruction of our planet, and our democracies – are calling into question the neoliberal world order.

I teach at Yale Law School, so I see it up close in the hallways. People will now say things to me like, “Well, capitalism is great. It’s just that it may destroy democracy.” This problem of inequality is really, really real. People who would not have been critical of this paradigm ten years ago are now themselves frightened by some of its implications, and are uncertain about it, or are at least trying to figure out what went wrong.

There are also new kinds of social movement power, as well as new forms of evidence about the problem. That has also changed the dynamic. That has changed the uniform way in which the mainstream, at a place like this law school, really seemed to subscribe to this kind of logic.

You have drawn attention to two ways in which these intellectual efforts to depart from neoliberalism have taken shape, and you are critical of both. In one essay, you focus on “productivism," or supply-side liberalism, as espoused by Dani Rodrik and others on the progressive left. In another essay, you tackle a movement on the right known as “common good constitutionalism.” Let’s start with the first. Can you talk about the pitfalls that you see in productivism?

Both productivism and supply-side liberalism speak to something important about the failures of neoliberal logics, and of economic governance, to produce an economy that we actually want. They name something that is important to address. But I also think they shouldn’t be seen as the answer to neoliberalism. If the thinking is, “Where we once had neoliberalism, now we have industrial policy and productivism,” then that would be quite limited and problematic.

Productivism as Rodrik expresses it – and I think supply-side liberalism has this same quality – conveys the sense that we are turning to more direct government management of supply chains, more direct government investment in rejuvenating our manufacturing sectors. One problem with this is that the service sector is vastly more important for the future of American workers than the manufacturing sector. The old terms of production don't actually capture the state of our economy today. 

So, the idea that we need to reinvest in a new productivism – particularly as oriented towards manufacturing, towards making sure that we can build again – seems to leave out an awful lot that has been part of the critique of neoliberalism. What about the care agenda? What's the plan for those aspects of the service economy? What about deeper critiques of climate and the relationship that capitalism sets up to ecology? 

Productivism might suggest, for example, that green tech is going to be the solution to climate change. We should see that as a component of our ability to address the ecological crisis, but only a limited one. So, there's a way in which productivism and supply-side liberalism are oriented to an inaccurate picture of the economy itself. In part, this is because it relies upon – and reproduces – ideas about the economy that are somewhat outdated; ideas that are themselves also organized around ways of thinking about what work is, ways of thinking about what our economy looks like, that feminists and ecological theorists have been criticizing for a long time.

But this all depends on your understanding of what productivism aims to achieve. Is it an attempt to identify the alternative to neoliberalism, the post-neoliberal paradigm? That's how I interpreted Rodrik's use of the term. And if that's the case, it seems to overlook many criticisms of neoliberalism by treating it as if it were solely a paradigm of production, and not also a paradigm of, for example, how government works. If you only see neoliberalism as a narrow orientation to production, to letting market signals and efficiency flourish, you will miss its relationship to how governance is organized. 

Neoliberalism is also about coercing some so that others can be free. It relates to why we have invested in the carceral state as a means of disciplining workers and avoiding social obligations, why we fill schools with cops instead of social workers. It relates to the phenomena that have weakened state capacity – not only state capacity to deliver semiconductors, but also health care, unemployment benefits, and education. If you see it so narrowly, you’re going to miss a lot of what, in fact, is at stake in neoliberalism.

The other approach you flagged, common good constitutionalism, is being put forward by some parts of the theocratic right in the legal academy. Before we engage with its content, can you talk about the role of the law school as such in consolidating the neoliberal paradigm?

I see law, and to some extent law schools and the legal academy, as providing the connective tissue between neoliberal ideas and governance. I'm very interested in tracing how ideas shifted in law schools in order to actualize parts of the academic neoliberal agenda. These ideas are always refracted through fields of power, and changed as they become embedded in governance. 

Antitrust law is a good example. Ideas about antitrust that were introduced in law schools under the heading of Law & Economics became very powerful. They were used to naturalize an idea of how markets operate. In this view, so long as there were no entry barriers caused by the government, competition would always emerge, and monopolies would be inherently unstable. Monopolies were taken to be a sign of scale efficiencies. So, there were many changes to the law to enable mergers to happen more easily. The enforcement of antitrust law was made subject to extremely precise econometrics, rather than to rules which may have, say, limited the size or structural orientation of certain industries. This led to a lot of difficulty actually enforcing the law.

In antitrust law you can also see another important idea, which is that this area of law should serve only one purpose: efficiency. In this context, efficiency is defined largely through price effects. Implications for the structure of our politics, or for workers more broadly, were not thought to be important anymore. What was important was reducing prices for consumers. This has a lot of implications for tech, where the business models are to make products free, like social media, or generate low prices for consumers, like Amazon. Despite the fact that the industry generates structural power and other harmful effects, it still looks like a win and the thought is that antitrust policy should allow it. 

In intellectual property law, there have also been many changes to make it easier to capitalize in the information industry. Minting new kinds of property, software patents, patents on business methods, extending the exclusive rights associated with those kinds of property – all of these are ways to allow for capitalizing in the industry. And they emerged at the same time as forms of regulation were rolled back, which might have been used to constrain how companies in these sectors exercised their authority. The Communications Decency Act is an example. 

But you also see changes internal to government itself, like the rise of cost–benefit analysis. Inside of government, “cost–benefit analysis” really only means arguments about costs and benefits that can be used to defeat regulation, rather than activate it. That's how it works inside of government.

You also get shifts in constitutional law doctrine, shifts in the way the First Amendment is understood. It's not until 1974 that corporate speech is protected in the American constitutional tradition. That becomes a vehicle for claims about the constitutional status of corporations' rights to do any number of things. The changes in First Amendment law have affected everything from labor unions to campaign finance.

Some of the features you're criticizing – for example, the focus on efficiency or cost–benefit analysis – could also be attributed to the fetish with economics in general. I wouldn't necessarily attribute them to neoliberalism as such. Within neoliberalism one can find thinkers, like James Buchanan, who deny that efficiency should be the benchmark.

So, it seems that some of these critiques are more about the praxis than about the logic. When it comes to how courts or regulatory bodies make their decisions, they do have to draw on certain techniques or tools – cost–benefit analysis being one of them – but this bridge to neoliberal logic could be attacked by neoliberals themselves.

This is a good place to question what it means to call neoliberalism a “logic.” More precisely, we need to be talking about neoliberalism as a reformatting of state power. In that sense, it's a politics and not a pure logic, I absolutely agree.

When you look closely at the logic of efficiency as it’s used in law, as I have done, it turns out that it is actually used to mean many different things in many different legal contexts. With intellectual property, the kind of efficiency that people talk about prioritizes innovation over everything else; but it doesn't have much to do with the kind of efficiency that's talked about in antitrust law, or the kind of efficiency expressed by cost–benefit analysis. They're actually all different.

They're all different, I think, because what they're ultimately responding to are ideas about the predominance of a certain kind of power: the power of markets over democratic kinds of governance. These understandings of efficiency then get expressed in different ways, depending on what advantages those forms of power. In that sense, I very much agree that there is not a pure expression of logic here, but rather many expressions of a political project that take different forms in different contexts.

So, cost–benefit analysis is itself a very misleading term. In health policy, cost–benefit analysis could lead you to say, “Gosh, we ought to vaccinate lots of kids.” But the way it's been institutionalized, it can only lead you to say, “Well, backup cameras are a bad idea if they raise costs greater than their benefits.” When these sorts of ideas enter into government, in particular, they operate in partial ways.

You've also written about the relationship between neoliberalism and human rights, specifically focusing on the right to health. What does a focus on health tell us about the broader relationship between human rights and neoliberalism?

I wrote the piece you’re describing out of frustration with both the shape of mainstream human rights law and discourse, and with certain criticisms of that discourse, like those of my colleague and friend Sam Moyn. As someone who has been involved in the global movement for access to HIV and other medicines, it’s clear that claims to a right to health necessarily implicate questions of political economy. How can you have a right to health if pharmaceutical companies, for example, are given monopoly rights – patents – that let them hike up prices on life-saving products, even with no justification at all that this generates innovation? Look at the price hikes for insulin recently, or the very recent price hikes on Moderna’s Covid vaccine (which was massively publicly funded, and clearly has earned back any private costs of investment). 

If you care about health, you need to address the structure of the industry and its power. There are ways to structure the industry (including via a larger role for public investment and price regulation) that could lead to both more access and more innovation. This should matter to human rights courts and institutions, and activists have tried to make this claim to them. But mostly, they reject it, because they see patents and industrial structure as something entirely separate from human rights. 

This is my frustration with human rights: it took its form at a period of high neoliberalism, when questions of economy were thought to be entirely separate from questions of rights. Human rights claims are even made on behalf of companies, who argue – sometimes successfully, as in the EU – that their IP rights deserve protection as human rights. 

But there also has been dissent in this tradition – AIDS organizations arguing that the right to health could allow courts to constrain patent rights, for example. And in that sense, critics of human rights like Sam sometimes flatten or overlook innovative attempts to use that tradition, including to help mobilize publics, as I think the access to medicines movement really did.

What are the main legacies of neoliberalism in the global governance of health? What did Covid tell us about their durability and contestability?

We have a global health governance regime that really has not contested private power over health, and that has accommodated narratives about private power and markets that do deep damage to global health. In the context of Covid, we were able to make enormously important vaccines – a scientific marvel – because of enormous public support, including support into research on coronaviruses that occurred many years before the pandemic, and support for global disease surveillance and genomic analysis that were essential to the process.

But over the last several years, governments like my own decided not to impose conditions on companies that would have helped to ensure that we could use the resulting vaccines to advance health for all of us. We allowed monopoly production of the most effective mRNA vaccines in private supply chains to which the North had privileged access, and allowed companies to refuse to assist critical attempts to manufacture these vaccines in the South.

While there was some new recognition that the global trade order and the TRIPS Agreement (which is part of the WTO and protects drug patents) was a problem, and there were small attempts to reform it, ultimately we were unable to overcome the ability of industry to largely dictate the terms of vaccine production and access – despite massive public subsidy. I think this is very clearly a legacy of the neoliberal order in health.

You've detailed how the current global patent system disproportionately benefits wealthy countries and corporations at the expense of the Global South. Are there any hopeful signs that it can be reformed?

I do see hopeful signs. The fact that the US government argued for the suspension of at least some parts of the TRIPS Agreement curing Covid was unprecedented. I wish they had gone further, and Europe had not been so recalcitrant, but it was an important and new step. It reflects that the neoliberal trade order is really under question now, though what will replace it is not yet clear. 

I find even more hope in experiments like this new mRNA production facility in South Africa, which is being supported by the World Health Organization, and in the fact that the state of California is now also working on making its own insulin. Challenging corporate authority will require not just modifications to IP but also real material investments like these to shift the balance of power over essential goods. 

There is a small but strong coalition of advocates in the Global North who are working to challenge pharma’s power and pricing here, many of whom entered this work first as advocates around global access to medicines. It’s ultimately those movement linkages that give me the most hope, because they involve brilliant and creative people who are grappling with the hardest questions, like how to improve both innovation and access, and because they’re doing so in ways that can really benefit people in the North as well as the South.

We were talking earlier about the ontological baggage that economists bring to this conversation. Do you think there’s something similar going on within the legal academy? When neoliberalism gets talked about in law schools, do you think that certain aspects of the topic get foregrounded and others become lost – not just by the right wing, but even your colleagues on the left?

Here's where I'm going to interview you. What do you think?

Well, yes, I do think there are certain things that become invisible. But I don't think it’s just a problem of the law school. Even in Wendy Brown's case, there is a certain reluctance to engage with neoliberalism as something that might actually enjoy legitimacy – even among its victims, so to speak. To account for that, I think you have to acknowledge that there are some genuinely exciting, even utopian, elements to it – which is hard to do if we just focus on the reformatting of state power. At the level of everyday life, it’s hard to get excited about regulation.

Somebody like Hayek believes that the market is a civilizational tool. It's not just a tool for aggregating knowledge or allocating resources, but rather a way to organize modernity and reduce complexity. What keeps society from falling apart, given its multiplicity, is this giant black box called the market, which also powers us forward.

Without accounting for that – without introducing a parallel, alternative utopia of some kind – I find it very hard to imagine how an alternative logic would come into being. And I don't see that logic coming into being by solely focusing on redistribution, or reparations, or restoring the power of the administrative state.

I agree that there are ways in which neoliberalism had real appeal. Part of what I've been reading recently are historical accounts of how the left, or at least liberal Democrats, came to embrace neoliberalism. It was, in fact, meant to rejuvenate parts of US society. It had a liberatory impulse. It was going to discipline a state that was deeply stuck, unable to deliver the things that people wanted. Having been trained in a law school, as a student I heard the story about what the turn to efficiency was supposed to do, as a neutral technology that would allow us to all get along and have the things that we individually wanted. On that account, I think it has had powerful appeal.

But then the question is, if we want to critique neoliberalism, what are its alternatives? We do need to have a conversation about that. I myself am very attracted to the writing of one of my colleagues at Yale, Martin Hägglund, especially his book This Life. I have long worked on health care and am very interested in other forms of care. That book offers a secular vision of liberation – being free to use our time the way we will, and then having an obligation to one another, to share the work that no one wants to do – that has within it very interesting governmental aspects. 

But it’s not fundamentally based on an idea of, say, a stronger administrative state. Rather, it has within it an idea of what we should want a state to do, and what we should want our politics to do. For me, that’s exciting in part because it aligns well with contemporary political mobilizations, from the moves to expand health care, to the moves to replace carceral responses with responses that are more supportive, rooted in forms of care. 

This is to say, critiques of neoliberalism should take seriously some of its popular appeal. Criticizing neoliberalism doesn't say a whole lot about what the possible alternatives, in fact, are. Having a sense of those alternatives matters a lot.

In one of your recent essays, you talk about the need to democratize market design. What would this entail?

One part of it is moving away from a conception of markets as following their own laws. We should recognize that we establish the laws, the forms of social practice, that give markets their shape and their implications. We ought to recognize that we have authority over the design of markets and not simply say that supply and demand caused this or that.

Pharmaceuticals are a clear example of how our collective power through the state is being used to shape what are called market outcomes. We give lots of authority to companies to set prices, and then we turn around and find that the prices of medicines are rising. This stands in deep tension with the idea that we all ought to have shared access to what we need to be healthy.

But not all the alternatives being proposed come from such progressive standpoints, including this idea of common good constitutionalism, to finally return to it.

Right. Common good constitutionalism is a development in legal discourse that a group of mostly Catholic thinkers are consolidating around, in order to re-inject constitutional discourse with a Catholic morality. One very practical expression in the American political context is a turning away from the historical, right-wing paradigm for constitutional interpretation – which was originalism, going back to what the founders wanted – in favor of a more muscular and assertive constitutional order based on religious principles. 

For example, originalists famously won in the recent abortion fight by arguing that the Constitution's text didn't protect abortion, and therefore that it left the matter to the states. Common good constitutionalists, however, are much more interested in a constitution that would protect fetal life. Rather than letting states choose to protect abortion, the Common Good Constitution would forbid them from doing so. This infusing of the American constitutional order with religious values is an expression of a broader move that I see on the post-neoliberal right. 

One very strong strain of it is recognizing the problems with market fundamentalism and neoliberalism – they even use that term – and arguing that we need to reintroduce value into American life. For them this should take the form of a return to the family wage; a return to normative, heterosexual families; a return to forms of state support for appropriate kinds of religiously ordered life; a return to religious values even in the marketplace. 

In the United States, we see this in cases like Hobby Lobby, with religiously inflected corporations wanting to express their values in the marketplace. There is a drive to allow that, whether in the context of gay wedding cakes or contraceptive coverage in health care. What concerns me about this – although it's a small part of a very broad and diverse right wing in the US – is that it has a fairly direct concept of how it could achieve predominance, which is through the Supreme Court, given how much power it has here. That makes it a very important development.

Picking up the theme of neoliberalism and utopia, it seems like we should be trying to come up with a social theory that can show us which other institutions allow for a world that is as diverse and vibrant as the one mediated through markets and law – which is the vision of Jürgen Habermas with some social movements thrown in on top.

Twenty years ago, American law schools were very good at imagining that utopian dimension, even if it was a naive utopia. But that is somehow gone from the analysis of neoliberalism today, which is troubling. Were the more utopian people so traumatized by the rise of Silicon Valley that they gave up thinking about such matters?

I do see there being utopian ideas – certainly progressive and aspirational ideas – inside of law schools these days. Look at some of the work on money. People are thinking about what it would mean to create everything from national investment authorities to a Fed that works on very different principles, or to reorganize the banking structure in order to enable forms of social provision and address climate change. That’s one example of something that's quite new.

We are also seeing lots of claims for something you might call decommodification: housing guarantees, health care guarantees, and even institutional expressions that might partake in some of what you're describing. Which is to say, how do you run a complex system like a health care institution based on need as opposed to profit? People have really thought that through. We have actual expressions of these principles in the world, and they are motivating ideas of what it would mean to shift other institutional powers in this direction.

If you were to put together a lot of these things – ideas about how investment might be directed more democratically, how housing might be organized more democratically, how health care might be organized more democratically; all of which you see being discussed inside of law schools, as well as beyond them – they would be pieces of a much more assertive vision of a future that isn't organized along neoliberal lines. It’s the putting together of all of these pieces, and giving it a new name, that has yet to be accomplished.

But I do think that those pieces are much more exciting than what was happening in the 2000s, for example the movements around open access and Creative Commons that you alluded to, because they also grapple directly with the need for forms of public power to create these things. And they're not based on a purely voluntaristic idea of what we can expect or achieve.

I agree that it's radical in outlook, but that's conservative for my taste in terms of its institutional mix. I agree that decommodification is radical after 50 years of neoliberalism, but it's not radical benchmarked against the British welfare state of the 1940s.

Now I want to interview you about the alternatives.

The person who needs to be convinced that the rule of the market is over is not so much the average judge, but somebody like Habermas. But there's not been much that would convince him that we have departed from the market and the law as the two dominant forms through which modernity gets its form.

I just don't see much thinking as to what the alternative ways of formatting modernity would be. Without them, the only thing we can change is the balance between the two forms – which, of course, I would rather have on the state side than the market side.

What are the new vehicles in your mind? Something to do with digital socialism?

Ultimately, I think it has to do with alternative forms of generating value, both economic and cultural. And that has to do with understanding the correct progressive counterpart to the market. From where I stand, I don't think that the progressive counterpart to the market is the state. I think it should be culture, very broadly defined – culture where it encompasses the knowledge and practices of communities.

More on the line of the commons than the state in that sense?

Yes, as a way of providing infrastructures to elicit the new and make sure that we can then coordinate for the effects that follow. And technology is key to that.

Interviewed by Evgeny Morozov and Ekaitz Cancela

Edited by Marc Shkurovich

Further Readings
Wendy Brown & Amy Kapczynski
South Atlantic Quarterly, Vol. 121(2)
Amy Kapczynski
LPE Project
Amy Kapczynski
LPE Project
Amy Kapczynski
Humanity, Vol. 10(1)
Amy Kapczynski
LPE Project
Dani Rodrik
Harvard University
Martin Hägglund
Anchor Books