Pros And Cons Of Neoliberalism

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Neoliberalism, while widely supported in the 1970s-1990s, does have a large downside making it hard to support. Though neoliberalism supported limited government interference with the economy and brought about deregulation and competitive exchange rates, neoliberalism in the long run helped out the rich most of all and lead to greater income inequality which we are still suffering from today. Since the early 19th century, income inequality has been on the rise and neoliberalism has done nothing to help this. 9% of the world’s richest inhabitants extract 50% of the worlds income, the poorest 50% receive only 7% of the global income. [1] Poverty results from extreme income inequalities, essentially the poor are poor because rich make so much of the money that the economy produces.
The Neoliberal approach involves limiting government interference in matter of economics and limiting government spending. During the late 1980s, the World Bank wanted to protect the financial stability of the economy and in order to do so it instituted policy changed such as reforms in labor market regulations and reductions in government spending. These were just innocent sounding ways of saying that they were recommending lowering minimum wage …show more content…
In the 1944 an international conference was held in New Hampshire, at this conference two agencies were founded, The World Bank and the International Monetary Fund. The World Bank, which was created in the 1940s, was originally intended to guarantee private bank loans for long-term investments in productive activities. The International Monetary fund was set up to help countries avoid balance of payment problems by extending short term loans to them. Due to the leadership of A.W. Clawson, the World Bank in the 1980s began shift emphasis in a neoliberal
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