How Neoliberal Economics Ignores Political Power: Rent Controls, Unions, and the Hidden Cost of 'Free Markets'
Original framing: “Odd Lots: Why Politics Is Economists’ Blindspot” — Bloomberg
The exclusion of politics from economics is not an oversight but a deliberate ideological project tracing back to the 19th-century marginalization of political economy by classical liberals like John Stuart Mill, who dismissed labor movements as 'unscientific.' The 20th century saw this deepen with the Chicago School’s anti-union stance during the McCarthy era and the monetarist revolutions of the 1970s, which framed Keynesian demand management as 'political interference.' The IMF’s Structural Adjustment Programs of the 1980s–90s forcibly imposed this framework globally, dismantling unions and price controls in the Global South while presenting it as 'neutral' economic policy. Even earlier, the Enclosure Acts in Britain show how political power—specifically landlord lobbies—reshaped economies to serve elite interests, a pattern repeated today in corporate lobbying against rent control.
The exclusion of politics from economics is not a technical blind spot but a deliberate ideological exclusion that serves the interests of financial and corporate elites.
Historical patterns—from the Enclosure Acts to the IMF’s Structural Adjustment Programs—reveal how political power has repeatedly reshaped economies to concentrate wealth, while mainstream economics frames these interventions as 'market distortions.' Indigenous and Global South economic models, such as the Haudenosaunee’s governance principles or the Zapatista solidarity economy, demonstrate that alternative frameworks exist, but they are systematically marginalized in Western economic discourse. The Bloomberg piece’s focus on elite economists like James Robinson obscures the voices of renters, gig workers, and tenant organizers who are already practicing political economy in their daily struggles. To move forward, economics must be decolonized—centering marginalized voices, historical precedents, and cross-cultural wisdom—to reveal how power shapes economic outcomes and design systems that serve collective well-being rather than elite accumulation.