Neoliberalism is also known as neoliberal economic understanding refers to the political-economic philosophy that reduce or reject government interference in the domestic economy.
The characteristics of Neoliberal Economic System:
- Focus on the free market methods
- A few restrictions on business conduct and the rights of private property.
- In foreign policy, neoliberalism is closely related to the opening of foreign markets by political means, using economic pressure, diplomacy, and / or military intervention.
- Opening of markets refers to free trade.
- Reduction Subsidy
- Prior Privatization / Sale SOE
- Deregulation / elimination of government intervention
- Reducing the state role in social services (Public Service) as
- education, health, and so on.
Neoliberalism aims to restore confidence in the power of free trade pasaratau (free market), with justification refers to freedom.
Free trade is an economic concept that refers to the sale of products between countries without import-export taxes or other trade barriers.
Free trade can also be defined as the absence of artificial barriers (government imposed constraints) in trade among individuals and companies that are in different countries.
Forms of trade barriers, among others:
- Rates or customs
- Quotas that limit many units that can be imported to limit the amount of goods in the market and raise prices
- Subsidies are generated from taxes as government assistance to local producers
- Local charge
- Regulation of the administration
- Anti-dumping Regulation.
History and Characteristics of the Implementation of Neoliberalism
Neoliberalism was developed in 1980 by the IMF, World Bank, and the U.S. Government (Washington Consensus). Aiming to make the developing countries as a cash cow the United States and its allies / MNC.
"Capital Market" (Money Market, Stock Market and Commodities Market) is a priority utama.Neoliberalisme prefers the financial sector (Macro) than the real sector. In Indonesia, about Rp 60 trillion / year for the owner of SBI / SUN.
Giving "policy" loans with terms of debt for the world of Neo-liberalism agenda. Awards are given to countries that adhere to and punishment for the disobedient. Afghanistan, Iraq, North Korea, and Iran is a prime example.
Neoliberalism system prohibits state interference against businessman / speculators. For example countries around the world are powerless to stop oil speculation.