The Philosophy of Social Market Economy: Michel Foucault’s Analysis of Ordoliberalism

Abstract

Michel Foucault’s lectures at the Collège de France in 1978–1979 centered on the analysis of power with regard to liberalism. Foucault especially focused on German ordoliberalism and its specific governmentality. Although Foucault’s review of the ordoliberal texts, programs, and books is very accurate there are some occasional “schematic” simplifications. Our article evaluates Foucault’s constitution of an ordoliberal “archive,” though more emphasis is placed on the general importance of the phenomenological orientation in Walter Eucken’s work. Hence, three tasks guide our paper: first, an analysis of Foucault’s position; second, the phenomenological foundation of ordoliberal discourse compared to 18th century liberal discourse, i.e. the way in which Walter Eucken received Husserl. Third, our article raises the subject of the mutual historical-epistemological complementation of philosophy and economics by taking Foucault’s analysis as the starting point. Furthermore, the consequences of a phenomenological, i.e. “eidetic” order of the economy, is discussed, focusing mainly on the expansion of competition in social domains. JEL Codes: B20, B29, B40

Contextual liberalism: the ordoliberal approach to private vices and public benefits

“…Furthermore, the ordoliberal approach does not contain a "liberal" philosophical underpinning. Instead, their philosophical influences can be found in German idealism, for Eucken especially in the person of Edmund Husserl (Goldschmidt 2013;Goldschmidt and Rauchenschwandtner 2018) and Immanuel Kant (Klump and Wörsdörfer 2009;Audier 2013) as well as-in the case of Rüstow in particular-the Greek classics (Rüstow 1952).…”

“…But I think we can say that Nazism was, in a way, the epistemological and political 'road to Damascus' for the Freiburg School. That is to say, Nazism enabled them to define what I would call the field of adversity that they had to define and cross in order to reach their objective (also see Goldschmidt and Rauchenschwandtner 2018).…”

The ordoliberalisation of the European Union?

“…In practical terms, OL is claimed to be the economic philosophy behind the successful post-World War II German social model (Goldschmidt and Rauchenschwandtner 2007;Vanberg 2004). Ludwig Erhard, the father of the German Wirtschaftswunder (as well as being the former minister of finance, Bundeskanzler, and professor of economics), was an explicit proponent of OL (Hutchinson 1981).…”

“…In the scholarly literature, OL is generally recognised as being a powerful economic philosophy framing the thinking of post-World War II Germany's political decisionmakers (Feld, Köhler, and Nientiedt 2015;Goldschmidt and Rauchenschwandtner 2007;Vanberg 2004;Walters and Haahr 2005). In recent years, the renewed relevance of OL stems from a postulated relationship between OL and the politics of austerity in the EU (Biebricher and Vogelmann 2017;Nedergaard and Snaith 2015).…”

‘There's a Brand New Talk, but it's Not Very Clear’: Can the Contemporary EU Really be Characterized as Ordoliberal?

“…Yet, in Foucault's perhaps unorthodox rendering, ordoliberalism is ‘both in practice and theory, the most clearly stated liberal governmentality. A governmentality that regulates the behavior of subjects between each other: the behavior of the governed among themselves, as well as their behavior towards the government’ (Goldschmidt and Rauchenschwandtner , p. 2). As such, it is not inherently incompatible with the idea of the state providing collective security in certain areas.…”