Villains of the Financial Crisis? Neoconservatives, of course…

Fulminating against the government’s economic policies, the Observer complained recently that:

For a generation, business and finance, cheered on by US neoconservatives and free market fundamentalists, have argued that the less capitalism is governed, regulated and shaped by the state, the better it works. Markets do everything best – managing business and systemic risk, innovating, investing, organising executive reward – without the intervention of the supposed dead hand of the state and without any acknowledgement of wider social obligations.

Gosh, is there nothing that can’t be blamed on those dastardly neoconservatives? I suppose the term has now been detached from its original meaning and is instead a catch-all label for nasty right-wingers. Nevertheless, even if this is so, trying to protect neoconservatism from this kind of attack is worthwhile since the distinction (chiefly in the United States) between neoconservatism and other strands of conservative thought is both useful and worth preserving.

This being so it’s a shame the Observer’s leader-writer forgot that Irving Kristol – the persuasion’s godfather – wrote a passably famous treatise called Two Cheers for Capitalism. That, sharp-eyed readers will note, is two cheers not three. Capitalism (and, though it is a different thing entirely, markets) work better than the alternatives but, to Kristol’s mind, capitalism alone is not enough. He meant psychologically or morally, not economically. True, some of Kristol’s successors took a less sceptical view of Wall Street but neoconservatism is not really at home in lower Manhattan no matter how much any leftish British newspaper tries to persuade you it must be.

A small point but one worth insisting upon from time to time.

Also: while some aspects of the financial world may now be thought to have been poorly regulated there is a difference between poorly regulated and not regulated at all.