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The Shock of the Real: TheNeoliberalNeurosis in the Life and Times of

Jeffrey Sachs

Japhy WilsonSchool of Social Sciences, University of Manchester, Manchester, UK;

[email protected]

Abstract: This paper draws on Slavoj Žižek’s critique of ideology in seeking to account forthe persistence and transformability of the neoliberal project. Against understandings ofneoliberalism as a utopian representation projected onto an external reality, I argue thatneoliberal ideology operates as a social fantasy, which structures reality itself against thetraumatic Real of Capital. The evolution of the neoliberal project should be understood,not as the meticulous manipulation of social reality, but as a series of increasingly desperateattempts to hold the very fabric of reality together. Reconceptualizing neoliberalization as aform of obsessional neurosis can help to explain the relentless persistence of “zombieneoliberalism” and its paradoxical trajectory towards increasingly intensive forms of socialengineering. This argument is developed through a critical engagement with the work ofthe economist Jeffrey Sachs. From shock therapy to the Millennium Villages Project, Sachs’strajectory embodies the characteristics of the neoliberal neurosis.The paper aims to undermine the apparently monolithic power of neoliberalism, bychallenging dominant critical representations of the neoliberal project in terms of ahyper-rational governmentality. It also aims to subvert the attempts by Jeffrey Sachsand other neoliberals to reposition themselves as opponents of the WashingtonConsensus, and as spokesmen of the Occupy movement. The chosen method ofattack is more satirical than polemical. Neurotic neoliberals such as Sachs havesuccessfully appropriated ethical objections to neoliberalism in the name of “global-ization with a human face”. In the present conjuncture, an immanent critique thatreveals the internal incoherence of neoliberal ideology, and the hapless flounderingof its proponents, is perhaps more effective than a repetition of familiar forms ofmoral condemnation. An alternative subtitle for this paper might therefore be“Towards a satirical materialism”.

Keywords: neoliberalism, ideology, fantasy, the Real, Slavoj Žižek, Jeffrey Sachs

The Enigma of Zombie NeoliberalismThe relentless dominance of neoliberal ideology in the wake of the Great Recessionof 2008–2009 has surprised even its most battle-hardened critics. Colin Crouch hasnoted “the strange non-death of neo-liberalism” (Crouch 2011), Mitchell Dean hasobserved that “neoliberal regimes persist in an ‘undead’ form” (Dean 2012:11),and Jamie Peck has wearily acknowledged that “The living dead of the free-marketrevolution continue to walk the earth” (Peck 2010b:109). These appeals to themetaphor of the undead indicate a deeper uncertainty concerning the seeminglyirrational endurance of neoliberalism in the face of all failures. Peck himself raises thisquestion, asking “What is it, then, that sustains this perverse form of worst-practiceconvergence, in the face of such deep contradictions and episodic waves of resistance

Antipode Vol. 46 No. 1 2014 ISSN 0066-4812, pp 301–321 doi: 10.1111/anti.12058© 2013 The Author. Antipode © 2013 Antipode Foundation Ltd.

and contestation?” (Peck 2010a:108). Yet he is forced to leave his own questionunanswered, resorting instead to the speculative invocation of “zombie neoliberalism”

(Peck 2010b).This failure to explain the persistence of neoliberal ideology is matched by a

similar uncertainty concerning the seemingly infinite transformability of the neoliberalproject, which has evolved from the macroeconomic abstraction of shock therapytowards ever-more intensive forms of social engineering. This transition has beenconceptualized as the shift from “roll-back” to “roll-out” neoliberalism (Peck andTickell 2002); from “shallow interventionism” to “deep interventionism” (Cammack2004); and from the “Washington Consensus” to the “Post-Washington Consensus”(Sheppard and Leitner 2010). Critics have noted the contradictory nature of thisprocess, through which the supposedly natural order of a market society is sociallyproduced. Graham Harrison has observed that “free market economics … can onlyrealise itself in development policy by engaging in broader social policy”(Harrison 2005:1304), while Thomas Lemke has wryly pointed out that theneoliberal project “endeavours to create a social reality that it suggests alreadyexists” (Lemke 2001:203). Despite identifying the paradoxical trajectory of neoliberaldevelopment, however, these theorists have not adequately accounted for it. AsHarrison admits, “we have some work to do before we can define [neoliberalism] ina way that works in the present day” (Harrison 2005:1304).This paper aims to account for the persistence and transformability of the neoliberal

project, through a reconceptualization of neoliberal ideology, based on the psycho-analytic social theory of Slavoj Žižek. Ideology is of course a terribly unfashionableconcept, owing to its binary juxtapositions of fact and value, appearance and essence,truth and falsity, and so on (Dikeç 2013). Much of the critical literature on neolib-eralism reproduces this standard notion of ideology, conceptualizing neoliberalismin terms of the projection of a utopian representation of a self-regulating market ontoa more-or-less intransigent social reality.1 Ben Fine, for example, describes the neolib-eral project as an attempt tomake the world “conform as far as possible to an entirelyimagined (free market) representation of itself” (Fine 2004:216), while Simon Clarkeclaims that its objective is not “to make a model that is more adequate to the realworld, but tomake the real worldmore adequate to its model” (Clarke 2005:58). Thisunderstanding of ideology rests on the Cartesian ontology of a rational, unitarysubject interacting with an objective external environment. For Žižek, by contrast,the subject is not the “primordially given” subject of the cogito, but is “the result ofa process in which traumatic cuts, “repressions”, and the power struggle intervene”(Žižek 1999:328), and reality is not instrumentally manipulated by the subject, butis cobbled together from a combination of Imaginary and Symbolic elements, in orderto protect the subject from a threatening and traumatic Real (Žižek 1989:133). Thisentails an understanding of ideology, not as an appearance projected onto an exter-nal reality, but as a “social fantasy” structuring reality itself, as a defence formationagainst the traumatic content of a Real social antagonism (Žižek 1989:126). Thisreconceptualization of ideology captures the orthodox neoliberal understanding ofmarket society as a spontaneous natural order that is already immanent in thestructures of the social world, rather than a social order to be constructed upon apre-existing reality. The persistence and transformability of the neoliberal project

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can accordingly be understood, not as the meticulous manipulation of social reality,or the gradual unfolding of a technocratic masterplan, but as a form of obsessionalneurosis—a series of anxious attempts to maintain a social fantasy in which the Realof Capital is disavowed.I develop my account of the neoliberal neurosis through a critical engagement

with the work of the economist Jeffrey Sachs, as a key figure in the evolution ofthe neoliberal project. Sachs is notorious for his shock therapy experiments in LatinAmerica, Eastern Europe, and the ex-Soviet Union, in which neoliberal policypackages were rapidly implemented, often with extremely negative social conse-quences. Yet he is now a prominent critic of the Washington Consensus that he usedto endorse, and has reinvented himself as one of the world’s foremost authorities onpoverty alleviation and sustainable development. He is Special Advisor to theSecretary General of the United Nations, Director of the Earth Institute at ColumbiaUniversity, friend of celebrity advocates such as Bono and Angelina Jolie, and thedriving force behind the Millennium Villages Project, which aims to achieve theMillennium Development Goals within a series of model villages across sub-SaharanAfrica. Yet despite his rejection of the Washington Consensus, and his embrace ofsocial engineering, the substance of Sachs’s economic theory and policy prescriptionsretains a commitment to neoliberal fundamentals.Sachs’s career thus embodies the persistence and transformability characteristic

of the neoliberal project. Through an engagement with his work, I argue that thisintertwining of persistence and transformability can be thought of as a form ofobsessional neurosis, through which the neoliberal fantasy is held together “by allkinds of frantic activity … precisely in order that nothing Real should happen”(Daly 2009:294). I begin by setting out the basis for a Žižekian contribution tothe critique of political economy, and sketching a preliminary account of the neolib-eral neurosis. I then develop this approach in the case of Jeffrey Sachs, identifyingthe catastrophic failure of shock therapy in Russia as an Event in which his neoliberalfantasy was ruptured by “the shock of a totally contingent encounter with the Real”(Žižek 1999:185). This traumatic encounter has been disavowed by Sachs in theoryand in practice. In theoretical terms, Sachs has engaged in an elaborate series ofmodifications of the neoliberal imaginary, framed in medical discourse, throughwhich symptoms of the Real of Capital have been externalized as pathologicalfactors threatening the natural health of the capitalist social body. Practically, Sachshas put this series of disavowals to work in the Millennium Villages Project, whichaims to reconstitute the neoliberal social fantasy in the midst of the supposedlyabject space of sub-Saharan Africa. In their willingness to betray many of theideological precepts of neoliberalism in order to sustain its basic symbolic coordinates,it is neurotic neoliberals such as Sachs who have ensured the continuity of actuallyexisting neoliberalism into, and perhaps beyond, its current “zombie” phase.

Neoliberalization as Obsessional NeurosisSlavoj Žižek is arguably the most prominent radical intellectual of our time. Yet incontrast to the widespread appropriation of his work in other fields, Žižek’s ideasare rarely applied to the critique of political economy.2 This is perhaps unsurprising,

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given that his own work in this field has lacked the rigour and originality of hisearlier contributions to philosophy and cultural theory (Parker 2004:83; Sharpe2004:198). Despite his turn from cultural studies towards political economy inrecent years, Žižek has not adequately grounded his political-economic interventionsin his own psychoanalytic approach, and has not developed this approach throughthe rigorous analysis of contemporary global capitalism. However, despite his failureto adequately realize the potential of his approach in this regard, Žižek’s earlier workon the critique of ideology provides the potential theoretical foundations for areconceptualization of neoliberalism that can help to explain the persistence andtransformability of the neoliberal project (Žižek 1989, 1993, 1997, 1999). Even whenrestricted to this earlier period, Žižek’s oeuvre is immense and extraordinarily diverse,and I make no claim to providing a comprehensive overview of it here. 3 Instead, Iconcentrate on the elements of his theoretical edifice that are most relevant to myaccount of the neoliberal neurosis.As already mentioned, Žižek’s ontology destabilizes the foundational Cartesian

assumption of a rational, unitary subject interacting instrumentally with anobjective external reality. Against this assumption, Žižek adopts Kant’s post-Cartesianassertion that “there is no reality prior to a subject’s positing activity” (Žižek 1999:87).However, whereas Kant retained the Cartesian subject as the rational constructor ofphenomenal reality, Žižek’s Lacanian reading of Hegel leads him to an understandingof the subject as constituted through incompleteness and lack. Given the ontologi-cally constitutive character of the subject’s activity, this implies “a pathological biasconstitutive of ‘reality’ itself” (Žižek 1999:87). For Žižek, following Lacan, what weexperience as reality is composed of three registers: the Imaginary, the Symbolicand the Real. The Symbolic is “the domain of structure, difference, and gap”,while the Imaginary “provides the illusion of stability, content, and wholeness”(Kay 2003:169), and these two registers are intertwined to form a fragile andincomplete “reality” against the traumatic Real. Žižek suggests that the Real can beunderstood as both an inert presence resisting symbolization, and a void aroundwhich the symbolic order is structured (Žižek 1989:170). As such, the Real is anelusive and threatening X that lies beyond the reach of direct experience, but thatnonetheless imposes itself upon reality, and is identifiable by its disruptive effects(Žižek 1989:162).Žižek’s account of the subjective construction of reality places particular signifi-

cance on the Event, which he defines as a contingent occurrence in which theSymbolic and Imaginary co-ordinates of “reality” are ruptured, and the Realimposes itself as a terrifying and incomprehensible force (Žižek 2002:19). In orderto re-establish a sense of identity and reality in the aftermath of an Event, the subjectmay resort to unconscious strategies of repression or disavowal. In repression, thetraumatic Real is excluded entirely from consciousness, though it remains operativein the unconscious, from which it continues to exert its destabilizing influences. Inthe subtler operation of disavowal, the Real is incorporated into the subject’ssymbolic universe through a variety of displacements, through which its properlytraumatic dimension is at least temporarily diminished (McMillan 2008). In eithercase, reality comes to be plagued by “symptoms”, certain stains upon the symbolicfabric, which mark the indelible presence of the Real (Žižek 1989:78, 1999:331).

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In cases of obsessional neurosis, the subject seeks to cope with the recurrentappearance of these symptoms through engaging in frenetic activity in order tostop the stains from spreading, and to guard against the possibility of a repeatencounter with the Real (Žižek 1989:191). In such circumstances, Žižek argues,reality is held together by a specific fantasy, operating in the Imaginary register,which infuses reality with a sense of stability and order, and which fills out thegaps and voids in the symbolic order through which the Real would otherwisecontinue to make its presence felt. For Žižek, then, fantasy is not an escape fromreality, but is integral to the structure of reality itself (Žižek 1989:30), constituting“the frame through which we experience the world as consistent and meaningful”(Žižek 1989:123).Žižek’s ontology is thus permeated by a “disturbing vision … of order precariously

balanced on a seething morass of disorder, and at the same time incomprehensiblypenetrated by it, so that in the midst of the order there always persists an ‘indivisibleremainder’ of chaos” (Kay 2003:113). Here I suggest that this “disturbing vision”captures the predicament of the neoliberal technocrat, who, through a series ofneurotic disavowals, seeks to sustain their social fantasy against the “seething morassof disorder” that is the Real of Capital. In recent years, Žižek has repeatedly identifiedCapital as the Real of our age, arguing that “‘reality’ is the social reality of the actualpeople involved in the productive process, while the Real is the inexorable ‘spectral’logic of Capital which determines what goes on in social reality” (Žižek 1999:331).Žižek does not develop this point systematically, and his claim has been dismissedby his critics as evidence of the inconsistency between his psychoanalytic theoryand hisMarxist political commitments, given that capital necessarily operates throughthe symbols, institutions and practices of phenomenal reality, and therefore “cannotbe the Lacanian Real” (Laclau 2000:291). However, Žižek’s terminology in thisinstance, and in his earlier engagements with Marxism (see Žižek 1989:11–54),suggests an understanding of capital not as a quantitatively measurable inventoryof things, or as a static relationship between sociologically defined classes, but asvalue-in-motion—as the alienated product of human labour which comes to developa quasi-autonomous, self-expansionary and crisis-ridden dynamic that increasinglyimposes itself upon social reality as an abstract form of domination (Postone 1993).4

From this perspective, capital can indeed be understood as Real, in the sense of anintangible substance only identifiable by its effects; as the void constituted by the classrelation that cleaves the fabric of capitalist society; and as the spectral and traumaticpresence that the neoliberal social fantasy operates to disavow.In speaking of a neoliberal social fantasy, I am again drawing on Žižek’s own

application of psychoanalytic categories to the broader social realm. For Žižek, theLacanian understanding of fantasy implies a radical reconceptualization of ideology.In its deepest and most powerful form, Žižek argues, ideology operates not as anillusory appearance projected onto an external reality, but as a social fantasy structur-ing reality itself (Žižek 1989:33). Just as the individual fantasy conceals the traumaticpresence–absence of an unsymbolizable Real, so the social fantasy functions to con-ceal the constitutive antagonisms of a given social order by constructing “a vision ofsociety which is not split by an antagonistic division, a society in which the relationbetween its parts is organic, complementary” (Žižek 1989:126). Žižek tends to draw



his examples of social fantasy from nationalist, racist, and totalitarian ideologies, butthe concept is equally applicable to the neoliberal adaptation of Adam Smith’s visionof a natural and harmonious market society, in which the self-interested activities ofindividual entrepreneurs are mediated by the invisible hand of the market to ensurethe optimal allocation of resources. As I argue in greater detail in the case of JeffreySachs, this ideology operates at the level of fantasy, to the extent that it is perceivednot as a utopia to be constructed, or as a vision to be projected onto an intransigentreality, but rather as a natural reality already immanent in the structures of the socialworld, to be uncovered from beneath the bureaucratic undergrowth of the interven-tionist state.5 Just as fantasy functions to conceal the void of the Real, so the neoliberalsocial fantasy functions to fill out the voids of the bourgeois symbolic universe againstthe Real of Capital: value is concealed by marginal utility; class relations are obscuredby freedom of exchange; the crisis-ridden dynamics of capitalism are nullified by theassumption of perfectly competitive equilibrium; and the spectral logic of capital asan abstract form of domination is expressed in disavowed form as the benignoperation of the self-regulating market. In the case of neoliberalism, then, as Žižekargues more generally:

Ideology is not a dreamlike illusion that we build to escape reality; in its basic dimension it isa fantasy-construction which serves as a support for our reality itself: an “illusion” whichstructures our effective social relations and thereby masks some insupportable Real …The function of ideology is not to offer us a point of escape from our reality but to offer… social reality itself as an escape from some traumatic, Real kernel (Žižek 1989:45).

The trajectory of the neoliberal project can be interpreted in precisely theseterms, as marked by repeated attempts to structure reality as an escape from thetraumatic Real of Capital. Adam Smith’s theory of the invisible hand was itself bornin the midst of the violent establishment of capitalist social relations, providingSmith with a reassuring vision that concealed “the harsh reality of the world aroundhim” (Perelman 2000:208). The economists of the Mont Perelin Society likewiseformulated the neoliberal project in the context of the Great Depression, theSecond World War, and the rise of communism, and have described themselvesas “drawn together by a common sense of crisis”, and “huddled together … forwarmth on a cold dark night” (cited in Peck 2010a:50, 66).6 In this traumaticmoment, the neoliberal fantasy acquired “an irresistible attraction … the almostsilent hum of a perfectly running machine; the apparent stillness of the exactbalance of counter-acting pressures; the automatic smooth recovery from a chancedisturbance” (Robinson 1962:77–78).Neoliberalism rose to hegemonic status through representing subsequent

economic crises as crises of Keyensianism or developmentalism, against which theneoliberal project could be advanced as a return to the natural order of a marketsociety (Peck 2010a:83, 106). From the 1980s onwards, however, with the consol-idation of neoliberalism as the hegemonic ideology, these crises began to tearthrough the fabric of the neoliberal fantasy itself. The continuity of the neoliberalproject has thus taken the form of an increasingly elaborate process of disavowal,through which the symptoms of the Real of Capital have been incorporated intothe symbolic universe of neoliberalism.7 Hence the proliferation of discourses of

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“market failure”, “imperfect competition”, “bad equilibrium” and so on, which havemodified the neoliberal imaginary while leaving its fundamental co-ordinatesunchanged, and which have framed the trajectory of the neoliberal project towardsincreasingly intensive forms of social engineering (Fine 2006; Peck and Tickell 2002).In the field of international development, for example, this trend has been embodiedin the transition from the Washington Consensus to the Post-Washington Consensus,which retains the basic principles of the Washington Consensus, while augmentingthem with multiple social interventions that aim to address the proliferating negativesymptoms of uneven capitalist development in order to maintain the neoliberal idealof “rational utility-maximising individuals engaged in harmonious exchange relations”(Taylor 2004:17). Despite their divergence from orthodox neoliberalism, the Post-Washington Consensus and other forms of “roll-out neoliberalism” should thereforebe understood as preserving rather than transforming the fundamental structures ofthe neoliberal fantasy. As Žižek explains in a different context:

The general lesson to be drawn … with reference to how ideology works concerns thegap that separates ideology qua discursive formation from its fantasy support: anideological edifice is of course submitted to incessant retroactive restructurations, thesymbolic-differential value of its elements shifting all the time, but fantasy designatesthe hard kernel which … anchors an ideology in some “substantial” point and thusprovides a constant frame for this symbolic interplay (Žižek 1993:213).

From this perspective, the evolution of the neoliberal project appears not as themeticulous manipulation of social reality, but as a series of anxiety-ridden attemptsto hold the very fabric of reality together, through constant ideological modificationsdevoted to explaining away the symptoms of the Real of Capital in such away that thecontours of the neoliberal fantasy can be retained. This process typifies the behaviourof the obsessional neurotic, who “builds up awhole system enabling him to postponethe encounter [with the Real] ad infinitum” (Žižek 1989:192). We can thereforeconceptualize neoliberalism, not as a hyper-rational technocratic project, but as aform of obsessional neurosis. The remainder of this paper develops this argument inthe case of Jeffrey Sachs, interpreting the failure of shock therapy in Russia as atraumatic Event, in which his neoliberal fantasy was shattered by the Real of Capital,and exploring the strategies of repression and disavowal through which he hassought to reconstruct the co-ordinates of his social fantasy.8

From Shock Therapy to Clinical EconomicsFor Jeffrey Sachs, as for the members of the Mont Perelin Society before him, theattraction of neoclassical economics was rooted in an obscure dread of communism.Sachs describes a high-school trip to Russia and a subsequent visit to East Germany aslife-changing experiences, in which he was confronted by the differences betweencapitalism and communism in ways that caused him to question the inherentsuperiority of the capitalist system (Sachs, in Richardson 2003).9 In 1972, Sachsentered Harvard to read Economics, and was placed under the tutelage ofAbram Bergson, a neoclassical economist and an expert on the Soviet economy(Ofer 2005). Bergson introduced Sachs to the work of the key figures of the



Mont Perelin Society—Friedman, Hayek, and VonMises, and as Sachs recalls, “I learnedabout a way of seeing the world” (Sachs 2005b:495, emphasis in original).10 Onceimmersed in the neoliberal imaginary, Sachs rose rapidly through the academic ranksat Harvard, becoming a tenured professor in 1983 at the age of 28. Two years later, aBolivian delegation requested his assistance in managing a crisis of hyperinflation. Itwas here that Sachs first developed the doctrine that became known as “shocktherapy”, based on the imposition of a sudden and systematic package of neoliberalreforms, including privatization, trade liberalization, macroeconomic stabilization,and the abolition of subsidies and price controls. The speed and comprehensivenessof shock therapy was designed both to shock the economy into health, and to shockthe population with its immediacy, in order to avoid effective political contestation(Murrell 1993:111–115; Sachs 1990, 1994b).11 Against theories of neoliberalism whichsee it as a “constructivist project” that aims to socially produce a market society (Brown2003), shock therapywas understood by Sachs as a project that aspired not to constructa utopian reality but to reveal a natural order. This is clear from the following statements:

Shock therapy has been attacked by many intellectuals as being yet another “construc-tivist” system of social engineering, trying to replace one dogma with another. This ismistaken … Whereas Lenin had also advocated a kind of “shock therapy” in 1902 inhis fateful and disastrous What is to be done?, his version … was to create a new worldthat had never existed … Shock therapy was relentlessly down to earth by contrast …(Sachs 1994c:270).

Like the old discussion of how you make a sculpture of an elephant … You just cut awayeverything that doesn’t look like an elephant (Sachs, in PBS 2000:19).

For Sachs, shock therapy is therefore premised not on the creation of a new world,but on the removal of everything that does not correspond to the pre-existing realityof a market society. As we have seen, this assertion of the neoliberal nature of reality ischaracteristic of social fantasy, understood as a deeper level of ideology that structuresthe very coordinates of reality itself. The implementation of shock therapy in Boliviaseemed to confirm the reality of this fantasy by ending hyperinflation and facilitatinga rapid transition to a free market economy, despite being characterized by increasedpoverty and political repression (Green 2003:74–75; Klein 2007:153). Sachs receivedinternational acclaim, leading to consultancy roles around the world in which he wasinvited to repeat his experiment (Sachs 2005a:108). When communism began tocollapse, Sachs returned to Eastern Europe, contributing to shock therapyprogrammes in Poland and elsewhere. Despite inducing a deep recession with severesocial consequences, Sachs’s role in Poland was again hailed as a triumph. Sachs wasdescribed in the New York Times as “the Indiana Jones of economics” (Wayne 1989),and commentators marvelled at his “Sachs appeal” (Holstrom 1992).In November 1991, while still only 37 years of age, Sachs was invited to serve as

an economic advisor to the Yeltsin administration, with the responsibility ofplanning Russia’s transition from communism to capitalism.12 This was animmensely significant opportunity, in personal as well as world-historical terms. Afterall, Russia was the place where Sachs had first been confronted by an alternativesystem of economic organization. It was the specialist subject of his mentor at Harvard,who provided himwith the conceptual frameworkwithwhich hewas able to affirm the

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naturalness and superiority of the capitalist system. This framework then inspired hispolitical interventions around the world, which seemed to offer dramatic confirmationof its validity. Now, riding awave of elite adulation, Sachs had the opportunity to imple-ment his shock therapy programme in Russia itself, at a truly world-historical momentin the consolidation of global capitalism. As Sachs himself recalls, “Communism wasfalling, and I was pinching myself because I was in the centre of this, the absoluteepicentre of it” (cited in Richardson 2003).At thatmoment, disaster struck. Russia’s shock therapy programme resulted in “the

longest and deepest recession in recorded human history” (Clarke 2002:187). Indus-trial production halved between 1990 and 1999 (Clarke 2002:196–197), and thenumber of people living in poverty increased from 2 million in 1989 to 74 million in1996 (Klein 2007:237–238). Furthermore, the Russian privatization process of1992–1994—the largest and most rapid privatization in world history—has beendirectly correlated with a dramatic increase in mortality rates (Stuckler et al2009), while also facilitating the rise of the notorious “oligarchs” (Holmstromand Smith 2000). In 1994, Sachs resigned from the Yeltsin administration,and abandoned Russia to its continued implosion (Erlanger 1994). He has sincedescribed Russia’s collapse as a “whirlwind” (Sachs 2005a:131), which gener-ated “confusion, anxiety, and [a] profound sense of bewilderment aboutmarket forces” (Sachs 1994b:507), and which he experienced as “life in theshock-trauma unit” (Sachs 1994b:503). This language suggests the disorientation ofsomeone whose fantasy frame has disintegrated, and who is suddenly and directlyconfronted by the Real of Capital, revealed not as a harmonious natural order, butas a formless vortex, a destructive force operating beyond the limits of humancontrol.13

As Sarah Kay argued, the shock of the Real thus “makes legible … what wasrepressed or rendered invisible by the current order. However, the Event and itstruth are unrecognizable within the order of knowledge that is sanctioned by theprevailing ontology” (Kay 2003:118). Despite being confronted by Real of Capital,Sachs was therefore unable to comprehend the “truth” of capitalism that Russia hadlaid bare—its grounding in the production of specific class relations, its generationof poverty and inequality, and its uncontrollable, crisis-ridden dynamics. In the yearsfollowing his abandonment of Russia, Sachs published a series of papers celebratingthe final consolidation of “a global capitalist world system, with profound benefitsfor both rich and poor countries” (Sachs 1995:50), and setting out a vision of capital-ism fromwhich all symptoms of the Real had been erased.Marx, he argued, had beencorrect in his prediction of the triumphant march of globalization, but had beenlimited by “a very crude labour theory of value, according to which … the incomeof capitalists resulted from the exploitation of labour” (Sachs 1999:91). Equally, Keyneshad been mistaken in his claim that capitalism was inherently unstable, as the GreatDepression had proved to be “a one-time fluke of grotesque proportions” rather thanindicating “an intrinsic feature of industrial capitalism” (Sachs 1999:100, 96). Further-more, colonialism was not the pioneer of capitalism, but was to be ranked alongsidecommunism and developmentalism as examples of failed non-market systems(Sachs 2000). Capitalism was thus cleansed of exploitation, crisis and past violence.Yet these samepaperswere haunted by incongruous visions of possible social collapse,



of “chronic chaos”, “turbulence and value destruction”, “disease ravaged societies”and “an orgy of … lawlessness and … war” (Sachs 1995:64; 1998: 7, 2; 2000:36).The intrusion of such apocalyptic imagery within Sachs’s determinedly Panglossian

representation of global capitalism can be interpreted as the return of the repressed—as the intrusion of the Real within a symbolic universe from which it has been forciblyexcluded (Žižek 1989:55, 169). Over time, however, Sachs’s understanding ofcapitalismhas come to be characterized less by repression than by disavowal. Poverty,inequality and other symptoms of the internal contradictions of capitalism are increas-ingly acknowledged, but are explained in terms of external pathologies threateningthe natural health of the capitalist social body. Sachs’s work in this regard includes arevival of environmental determinism, in which uneven geographical developmentis attributed to inherent environmental differences rather than political-economicprocesses (Bloom and Sachs 1998; Gallup et al 1999). He has also sought toreframe the relationship between poverty and health, arguing that poor health isa cause of poverty rather than vice versa, and reducing the value of healthcare toits quantifiable contribution to labour productivity (Commission onMacroeconomicsand Health 2001). Continuing the medical metaphors of shock therapy, Sachs nowdescribes his approach as “clinical economics” (Sachs 2005a:74–89), according towhich multiple “infectious agents” can contribute to the crisis of a normally healthysystem, provoking “a downward spiral of catastrophe” (Sachs 2005a:76).14 Theseexternal agents include “urgent problems involving poverty traps, agronomy,climate, disease, transport, gender and a host of other pathologies that undermineeconomic development” (Sachs 2005a:79). From this perspective, capitalism appearsnot as a social order to be constructed, but as a natural body to be returned to health.This again suggests that, for Sachs, neoliberalism is not a utopian ideology projectedonto an external reality, but a fantasy structuring reality itself.15

What is it, then, that has allowed Sachs to sustain this fantasy? In other words, ifactually existing capitalism is so “diseased”, what grounds his belief in its naturalhealth? Here we reach the level of the “fundamental fantasy”, which for Žižek isalways a “fantasy of origins” (Sharpe 2004:154). Žižek identifies Adam Smith’s myth-ical prehistory of capitalism as the quintessential fantasy of origins (Žižek 1997:11),and it is precisely this fantasy that grounds Sachs’s faith in the natural health ofcapitalism. Following the Russia Event, Sachs has increasingly invoked the name ofAdam Smith as the “subject supposed to know”—the figure whose knowledge thesubject typically appeals to in the generation of new meaning (Žižek 1989:185).16

The attraction of Smith for Sachs is clear. As discussed above, Smith himself wasconcerned with providing an account of capitalism that removed all traces of internalantagonism. Central to this account was an imagined history of the original accumu-lation of capital as a natural and inevitable process. According to Smith, the origins ofcapitalism lay in private smallholding farmers accumulating capital by dint of theirown frugality, and putting it to work in the process of further accumulation, leadingto the division of labour and the growth of trade, and resulting in the peaceful emer-gence of a commercial society of small-scale entrepreneurs (Perelman 2000:171–228).In setting out his own account of economic development, Sachs reproduces thisfantasy of origins, telling a story of the emergence of capitalism through theaccumulative activities of “a single farm household” (Sachs 2005a:51), which

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“exemplifies Smith’s insight” (Sachs 2005a:53). Through hard work the householdacquires some savings, moves from subsistence to cash crops, begins to specializein a single crop, upgrades its capital inputs, and acquires more land (Sachs2005a:52–53). Capitalism, Sachs concludes, is the aggregate outcome of this pro-cess operating “through the interactions of thousands or millions of householdslinked together by markets” (Sachs 2005a:54). This, then, is the naturally healthycapitalist social body that clinical economics endeavours to cure and protect.Adam Smith’s fantasy of origins can therefore be identified as the fundamental

fantasy upon which Sachs has structured his system of disavowal, through whichsymptoms of the Real of Capital appear as external pathologies, rather than internalcontradictions. For Sachs, this fantasy also functions to conceal the necessarilyviolent foundation of capitalist social relations (Žižek 1997:11). As Marx has arguedin his critique of Smith’s account of original accumulation, this “paradise lost of thebourgeoisie” functioned precisely to obscure the violence of primitive accumulation—the separation of the peasantry from the land through which capitalist socialrelations were historically established (Marx 1972:59; 1977:873–940). Thisfounding violence was implicit in the rapid privatization programmes so centralto shock therapy, but it was only in Russia that Sachs was confronted with the fullmaterial force of its social implications. Smith’s fantasy of origins is thus a screen thatshields Sachs not only from the Real of Capital, but also from his own instrumentalityin the violence of its production. As Žižek insists, “There is no order of being as apositive ontologically consistent whole: the false semblance of such an order relieson the self-obliteration of the Act” (Žižek 1999:287). The following section interpretsthe Millennium Villages Project as a further attempt at “obliteration” in this sense,throughwhich Sachs has sought to realize his fantasy of originswithin the supposedlyabject space of “Africa”.

The Sublime Object of Neoliberal IdeologySince the start of the new millennium, Jeffrey Sachs has successfully reinventedhimself as a development guru. His work on clinical economics discussed in theprevious section led to his appointment in 2002 as the UN Secretary General’sSpecial Advisor on the Millennium Development Goals, and in the same year hewas appointed Director of the Earth Institute at Columbia University. He has madehigh-profile journeys to sub-Saharan Africa with celebrities such as Bono, Madonnaand Angelina Jolie, and was listed among Time Magazine’s 100 most influentialpeople in the world in 2004 and 2005. In his best-selling anti-poverty manifesto,The End of Poverty, Sachs distances himself from shock therapy, makes no directmention of capitalism, and argues for an increased role for state intervention andinternational aid in providing the “big push” necessary for poor countries to “gaina foothold on the bottom rung [of] the ladder of development” (Sachs 2005a:2).Many influential critics of neoliberalism, including David Harvey (2005:221) andNaomi Klein (2007:247), have suggested that Sachs’ new agenda indicates anabandonment of neoliberalism. Equally, unreconstructed neoliberals such asWilliam Easterly have attacked Sachs for betraying the fundamental tenets of neoliber-alism by engaging in “utopian social engineering” (Easterly 2006:96). Here I suggest



that, on the contrary, Sachs’ newfound concern with poverty in sub-Saharan Africacontinues to demonstrate the characteristic tendencies of the neoliberal neurosis.Žižek argues that when the Real of Capital “is disavowed, when its key structuring

role is suspended, other factors…may come to bear an inordinateweight; indeed, theymay bear all the weight of the sufferings produced by capitalism” (Žižek 2000:97). ForSachs, it is “Africa” that has come to bear this weight. Following his abandonment ofRussia in 1994, Sachs immediately became fixated upon sub-Saharan Africa, makinghis first journey there in 1995 (Sachs 2005a:188). Sachs recalls experiencing Africa asa “horrific catastrophe” (Sachs 2005a:7), “collapsing from social and economicdisorder” (Sachs 1995:59), and characterized by the “omnipresence of disease anddeath” (Sachs 2005a:194), and he persistently depicts the continent as the land of“the voiceless dying” (Sachs 2005a:188), in which “people have nothing and arenot even successful enough to stay alive” (Sachs 2006).17 Sub-Saharan Africa is ofcourse confronted by very severe socio-economic problems. Nevertheless, the apoca-lyptic imagery with which “Africa” is relentlessly portrayed by Sachs, and his suddenshift of attention from Russia to Africa, together suggest that the disturbing symptomsof the former may have been displaced onto the latter. Writing in 1994, only monthsafter leaving Russia, Sachs contrasted Russia’s circumstances to those of Africa,arguing that “If its reforms are given a chance, Russia will prove not merely viableeconomically, but highly promising. The same cannot be said of … Africa, wheremisrule, disease, and civil strife have left hundreds of millions untouched by the forcesof global economic integration” (Sachs 1994a:28). For Sachs, then, the discovery ofAfrica allowed the symptoms of shock therapy’s failure in Russia to be displaced intoan abject space in which they could be attributed not to global capitalism, but ratherto its absence, appearing as grotesque aberrations of poverty, crisis and death, inrelation to which Sachs has been able to reconstruct his own identity as an economicdoctor administering emergency treatment.18

Within the symbolic universe of Jeffrey Sachs, Africa has thus come to function aswhat Žižek would call a “sublime object of ideology” (Žižek 1989). A sublime objectis a common material object which acquires a peculiar fascination for the subject,due not to some inherent essence, but to its symbolic location as an object thatboth obscures and embodies the void of the Real. The sublime object providesstability to the symbolic structure by concealing the traumatic Real within it, yetat the same time, the Real “shines through” this object, illuminating it with anuncanny presence that is both terrifying and compelling (Žižek 2001:100).19 ForSachs, “Africa” can be understood as a sublime object in this sense, covering thevoid in his symbolic universe that the Russia Event had revealed, but bathed inthe light of the Real of Capital that shines behind it, leading Sachs to recoil inhorror—as demonstrated by his apocalyptic descriptions of the continent—but alsodrawing him towards it as site for intervention in which the Real can be meaning-fully and bearably engaged with, if only in disavowed form. As Sachs himself saysof his experience of Africa, in terms that capture this unsettling mixture of horrorand fascination, “The dominant experience is disease and death; it was shockingand riveting on an emotional level” (cited in McClellan 2003, emphasis added).Increasingly, “Africa” has come to occupy the place of a sublime object, not only

for Sachs, but for the neoliberal project as a whole. The shift to the Post-Washington

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Consensus has been accompanied by the representation of sub-Saharan Africa asthe one place on the planet still excluded from the “virtuous circle” of globalization.This has functioned both to detract attention from the persistent failures ofneoliberal development elsewhere in the world, and to foreclose the possibilitythat the economic and social crises of sub-Saharan Africa are not an exceptionto globalization, but are integral to the functioning of global capitalism itself(Ferguson 2006:41). A defining moment in this process was the designationof 2005 as the “Year of Africa”. Events that year included Make Poverty History,the G8 Summit on African development, and the publication of Tony Blair’sCommission for Africa report, all of which contributed to the consolidation ofthe Post-Washington Consensus (Cammack 2006; Harrison 2010a). Sachsplayed a key role throughout, publishing The End of Poverty and the UnitedNations’ Millennium Project report, which was produced by a 250-strong taskforce chaired by Sachs himself. The report set out a comprehensive policypackage for the achievement of the Millennium Development Goals. Despitebeing framed in the discourse of human development, the report retained acommitment to Washington Consensus fundamentals concerning free trade,export-led development, and macroeconomic stability. The macrostructures ofglobalized neoliberalism were therefore to remain unchanged, with interventionslimited to the targeted provision of basic needs to “the poorest of the poor”(Millennium Project 2005).The fundamental assumption underpinning the Millennium Project is that “If

every village has a road, access to transport, a clinic, electricity, safe drinking water,education, and other essential inputs, the villagers in poor countries will show thesame determination and entrepreneurial zeal of people all over the world” (MillenniumProject 2005:15, emphasis added).20 This appeal to the universal human nature ofhomo economicus is combined with a revival of the Dickensian fantasy of the selflessdeserving poor, who are “hard working, prepared to struggle to stay afloat and toget ahead … They are also ready to govern themselves responsibly, ensuring thatany help they receive is used for the benefit of the group rather than pocketed bypowerful individuals” (Sachs 2005a:242). Here we can see the outlines of theSmithian fantasy of origins discussed in the previous section—the imagined historyof capitalist development based on the entrepreneurialism and community spirit ofthe smallholder village. This fantasy is now being realized in the Millennium VillagesProject, which Sachs launched in 2005 to demonstrate the effectiveness of theMillennium Project agenda. The Millennium Villages Project applies this agendain 80 villages across 10 countries in sub-Saharan Africa, with the aim of achievingthe Millennium Development Goals by 2015.21 Funded by his own MillenniumPromise philanthropic organization, and drawing on the scientific expertise of theEarth Institute, the Millennium Villages Project constitutes Sachs’s first directengagement in policy implementation since his abandonment of Russia. As such,the Project can be interpreted as a further attempt by Sachs to reconstitute his socialfantasy, through revealing the immanence of a harmonious market society withinthe sublime object of “Africa”. As Sachs himself explains, this social order is alreadylatent in African reality, and will spontaneously emerge as soon as the rightconditions are in place:



Almost all of Africa is the private sector. Farmers, that’s the private sector … But privatesector doesn’t mean you just leave them alone … They can’t get started because they’reso impoverished. So we should help a private sector-led development by helping thesefarmers use inputs, boost their productivity … Bring in microfinance and let them rip.And that’s basically the model (Sachs 2006).

The irony, of course, is that far from demonstrating the natural order of amarket society, the Millennium Villages Project demonstrates the extent towhich this society must be socially produced. The first 5-year phase of theProject included a comprehensive and integrated set of interventions targetingall dimensions of everyday life, and focused on raising the inhabitants’ human,social, physical, natural, and financial capital to “the threshold level, abovewhich the villages can move towards self-sustaining growth” (Sanchez andSachs 2007). Beginning in 2011, the second 5-year phase is focused primarilyon “business development” (Millennium Villages Project 2011). Subsidies arebeing replaced by micro-credits for farm inputs, links are being established withprivate sector agribusinesses, and peasant farmers are being encouraged to“diversify to off-farm employment”, and to make the shift “from sub-subsistence tosmall-scale entrepreneurs” (Sanchez and Sachs 2007). Having begun his careerwith shock therapy, which assumed that the removal of state impedimentswould be sufficient to reveal the spontaneous order of a market society, Sachsis thus finally forced to engineer that society in its entirety in the form of theMillennium Villages.For Sachs, the success of the Millennium Villages is paramount. Were the

Project to achieve the Millennium Development Goals by 2015, Sachs wouldnot only have further distanced himself from the legacy of shock therapy, butwould also have successfully reconstituted his social fantasy in the face of theReal of Capital revealed by the Russia Event. The Project’s official statisticssuggest that the Goals are indeed on target to be achieved (Millennium VillagesProject 2011), but these statistics have been disputed by independent econo-mists (Clemens and Demombynes 2010; Wanjala and Muradian 2011).Development experts have also questioned whether the successes of the Projectcan be scaled up to a more inclusive level, or sustained beyond its completiondate in 2015, given the failure of similar projects in these respects in the past,and the Project’s affirmation of the macroeconomic structures of neoliberalism(Cabral et al 2006; Carr 2008). Furthermore, by misrepresenting the Africanvillage as the smallholder community of Smithian fantasy, the Project threatensto exacerbate the inequalities of wealth and power that already exist in suchplaces (Mueller 2011; Oya 2010). Project inputs have proven vulnerable to“elite capture” (Overseas Development Institute 2008), and the expansion ofagribusinesses and cash crop production is likely to extend capitalist social relationswhile aggravating their attendant tensions and antagonisms, leading to the produc-tion of a social reality very different from the harmonious village that Sachs imagines.In other words, the Millennium Villages Project threatens to confront Sachs withprecisely the “return of the repressed” that it has contributed to protecting him from,by once again exposing both the Real of Capital and his own continued instrumentalityin its social production.

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Traversing the Fantasy?This paper has drawn on the case of Jeffrey Sachs in seeking to account for theremarkable flexibility and endurance of neoliberal ideology in the face of therepeated failures of the neoliberal project. In contrast to other critical approachesto neoliberalism, I have argued that neoliberal ideology operates less as a utopianideal to be constructed within reality than as a social fantasy structuring reality itself.The persistence and transformability of the neoliberal project can therefore beunderstood, not as the calculativemanipulation of social reality, but as an increasinglydesperate struggle to hold reality together, against the traumatic incursions of theReal of Capital. It is this continual struggle, advancing through multiple processes ofrepression and disavowal, which has driven the neoliberal project towards ever moreintensive forms of social engineering, resulting in the social production of the suppos-edly natural order of a market society. This constant anxious activity, directed towardsensuring the stability of the subject’s symbolic universe against encounters with theReal, is the definitive characteristic of obsessional neurosis. For this reason, I havesuggested that the neoliberal project can be conceptualized in terms of a “neoliberalneurosis”. This is not to claim that all neoliberals are neurotic. On the contrary, theparameters of mainstream debate are increasingly defined by neurotic neoliberals likeSachs on one side, and unreconstructed neoliberals like William Easterly on the other.As we have seen, Easterly accuses Sachs of compromising his commitment to themarket. Yet it is precisely through their willingness to compromise certain ideologicalprecepts that Sachs and his fellow neurotic neoliberals have succeeded in sustainingthe basic symbolic coordinates of neoliberalism as the foundation of mainstreamdevelopment policy. It is therefore the neurotic neoliberals, as opposed to their moreorthodox counterparts, who have ensured the continuity of the neoliberal project.22

To conclude, we can return to the metaphor of the undead with which thisdiscussion began. As we have seen, the neoliberal neurosis is characterized byrepeated attempts to maintain the coherence of the subject’s social fantasy againstthe Real of Capital. Yet because neoliberalism is premised on removing all barriersto the movement of value, and on extending capitalist social relations to the endsof the earth, it paradoxically intensifies the very contradictions of capitalism that itis shielding its protagonists from. The predicament of the neurotic neoliberal thusrecalls that of the private investigator Harry Angel in Alan Parker’s Angel Heart,who fruitlessly pursues a serial killer through numerous false leads, only to makethe final discovery that he himself is the murderer. In a similar way, the neoliberalneurosis compels its agents to engage with the symptoms of capitalism, but in adisavowed form that prevents them from identifying themselves as those responsi-ble for the exacerbation of the very symptoms that they are attempting to address.Angel’s final realization results in psychotic breakdown. Is this not analogous to the“zombie neoliberalism” that Jamie Peck alludes to? The “strange non-death ofneoliberalism” in the aftermath of the global crisis of the neoliberal project couldthen be compared to the disintegration of the symbolic universe characteristic ofpsychosis, in which the distance between the Imaginary and the Real has finallycollapsed, and the subject is gripped by what Freud called “death drive”—the“blind insistence that follows its course with utter disregard for the requirementsof our concrete life-world” (Žižek 2001:98). This definition of death drive resonates



with an understanding of the Real of Capital as an abstract form of domination thatis “blind, processual, and quasi-organic” (Postone 1993:270). Could this be themysterious force that continues to animate “the living dead of the neoliberalrevolution”? If so, then the death drive of zombie neoliberalism is the Real ofCapital itself.For the neurotic neoliberal, an unlikely alternative to this blind submission to the

death drive would be to “traverse the fantasy” (Žižek 1999:460), confronting theReal of Capital in all its traumatic horror, and forging a genuinely transformativepolitics on the basis of this experience. Strangely enough, this would appear tobe exactly what Jeffrey Sachs has done. Since the onset of the Great Recession,Sachs has launched outspoken tirades against “the mad pursuit of corporateprofits” (2011a) and “the avarice of globally mobile capital” (Sachs 2011b). Heeven appeared at Occupy Wall Street, where he gave an angry speech denouncingbankers, corporations and the business press.23 Yet this seemingly radical discoursecontinues to be underpinned by an appeal to Adam Smith’s faith in a benign andethical capitalism, based on both the invisible hand of the market and the moralsentiments of the good capitalist. In the pages of the Financial Times, for example,Sachs continues to insist that “self-interest, operating through markets, leads tothe common good”, while gently warning his readership that “self-interest, withoutmorals, leads to capitalism’s self-destruction” (Sachs 2012). The neoliberal fantasyis thus retained, and corrupt bankers and corporate law-breakers are only the latestsymptoms through which the Real of Capital is disavowed. Once again, the solutionto the pathologies of global capitalism is to be found in capitalism itself. Indeed, it iscapitalism that is to be defended against its own potential “self-destruction”. In thisway, the transformative potential of Occupy Wall Street is sublimated into areaffirmation of the status quo. If there is a lesson for those struggling againstzombie neoliberalism, it must be to keep a close eye on those who appear to befighting alongside you. As Žižek warned during his own appearance at Occupy,“Beware not only of enemies, but also of false friends who pretend to support us,but who are working hard to dilute our protest” (Žižek 2011). In other words, JeffreySachs wants to eat your brain.

AcknowledgementsThanks to Terrell Carver, Greig Charnock, Andy Merrifield, Fabiola Mieres, Jamie Peck, StuartShields, Erik Swyngedouw, and three anonymous reviewers for helpful comments on anearlier draft. Any errors are of coursemy own. Versions of this paper were presented to the ThirdWorld Research Group at Aberystwyth University in May 2012, the Northern IPE Network’sannual meeting at the University of York in June 2012, and the Open Spaces Forum at theUniversity of Manchester, also in June 2012. I am grateful for the comments that I received fromthe audience on these occasions. I acknowledge the financial support of the HallsworthResearch Fellowship in the funding of this research.

Endnotes1 This literature includes key contributions from a variety of theoretical perspectives, including

Marxist (Cammack 2004; Harvey 2005), constructivist (Mirowski 2002; Peck 2010a), andFoucauldian (Lemke 2001; Dean 2012). The Foucauldian contributors in particular mightwish to contest the charge of Cartersianism, given the centrality of the critique of the subject

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within Foucauldian theory. Yet much of the literature on neoliberal governmentality concep-tualizes neoliberalism as a meticulously instrumental rationality.

2 Other applications of Žižekian theory to questions of political economy include Dean 2008;De Vries 2007; Kapoor 2005; Kingsbury 2005; Secor 2008; Sharp et al 2010; Swyngedouw2010.

3 There have been several book-length attempts to provide a synthetic overview of Žižek’swork, but even these have found it necessary to concentrate on a specific dimension ofhis work, be it the Real (Kay 2003), jouissance (Dean 2006), objet petit a (Sharpe 2004),or the master-signifier and the Act (Butler 2003).

4 Žižek draws on Postone’s work in his own recent proposal for a “return to the critique ofpolitical economy”, although he does not engage with Postone in the way that I amsuggesting here (Žižek 2010:181–243).

5 It is important to distinguish here between the ordoliberal and neoliberal strands of theneoliberal project, the former of which originated in Germany, with the latter being mostclosely associated with Milton Friedman and the Chicago School. Whereas for theordoliberals, neoliberalism was a self-consciously constructivist project, the ChicagoSchool neoliberals understood market society as a spontaneous order to be revealed ratherthan produced (Lemke 2001; Peck 2010a:65–68). It was the latter strand of the projectthat became hegemonic, hence my privileging of it here.

6 As Karl Polanyi pointed out at the time, “The origins of the cataclysm lay in the utopian endeav-our of economic liberalism to set up a self-regulatingmarket system” (Polanyi 1944: 39) Giventhis fact, it seems incomprehensible that the members of Mont Perelin would have chosen toresurrect the same project, and Polanyi himself discounted the possibility of such anoccurrence. Yet this is to misunderstand neoliberalism as an ideology projected onto reality,as opposed to a fantasy providing the basic coordinates of reality itself, which the traumatizedsubject strives to reconstitute rather than replace.

7 In the words of one neoclassical economist cited by Naomi Klein, “It’s as if there is a verypretty but highly complex picture out there, which is perfectly harmonious within itself… and if there’s a speck where it isn’t supposed to be, well, that’s just awful … it is a flawthat mars the beauty” (cited in Klein 2007:53). This comment captures the experience ofthe symptom as “a stain … which colours the alleged neutral universality of the symbolicframe” (Žižek 1999:331).

8 My engagement with Sachs’s work in this paper is necessarily brief and impressionistic. Fora more detailed and sustained critique of Sachs, see Wilson (2014), which builds on thetheoretical approach taken in this paper.

9 Sachs recalls that he was “besieged with questions from young East Germans. Why do youhave unemployment in the US when we do not? Why do you have poor people andinequality in the US? I could not challenge or give satisfactory answers to these questions… I did not even know … what the appropriate framework was to think about these questions”(Sachs, cited in Snowdon 2005:29, emphasis added).

10 Bergson was not a doctrinaire neoliberal, and also introduced Sachs to the work of“neo-Keynesians” such as Paul Samuelson. Nevertheless, Bergson considered hisresearch on Russia to be a confirmation of Hayekian theory (Ofer 2005).

11 There is an immense literature on shock therapy, and my concern here is only to indicatesomething of its theoretical content and personal significance for Jeffrey Sachs. Fordiscussions of the social impact of shock therapy in Bolivia, see García Linera (2006)and Green (2003). For Poland, see Murrell (1993) and Shields (2008). For Russia, seeBurawoy (1996) and King (2002). Wilson (2014:ch 1 and 2) provides an overview ofthe social consequences of shock therapy in Poland, Bolivia and Russia.

12 Sachs describes his project in both Poland and Russia as a return to “normalcy”—a phrasewhich again demonstrates the extent to which neoliberalism is perceived by him, not as areality to be constructed, but as the structuring principle of reality itself (Sachs2005a:133–134).

13 “For Lacan, fantasy is on the side of reality—that is, it sustains the subject’s ‘sense ofreality’: when the phantasmatic frame disintegrates, the subject undergoes a ‘loss ofreality’ and starts to perceive reality as an ‘unreal’ nightmarish universe with no firmontological foundation; this nightmarish universe is not ‘pure fantasy’ but, on the contrary,



that which remains of reality after reality is deprived of its support in fantasy” (Žižek 1999:57,emphasis in original).

14 There is a long tradition of medical metaphors in bourgeois economics, dating back toeighteenth century political economists such as Locke, Mandeville and Quesnay(Caffentzis 2003; Groenewegen 2001).

15 Discussing the politics of disavowal, Žižek notes the appeal of “the medical model: society isa corporate body, an organism; social divisions are like illnesses of this organism”, whichmust be cured if “the health of the social body is to be established” (Žižek 1999:226). Theimplicit assumption of a healthy social body underpinning Sachs’s metaphors of pathologyand disease typifies this medical model.

16 Sachs appeals to Adam Smith as an unquestionable source of authority on innumerableoccasions, including his writings on geography (Sachs 2005a:34), his theory of value(Sachs 1999:91), and his account of human nature (Gallup et al 1999:166). In Sachs’sown words, “It’s all in Adam Smith!” (Sachs, in Snowdon 2005:37).

17 When Sachs speaks of Africa he generally means sub-Saharan Africa. The language Sachsuses to describe “Africa” reproduces Enlightenment representations of the continent as avoid of chaos and despair (Mbembe 2001:1–9). Indeed, at one point Sachs uncriticallycites Adam Smith’s claim that “All inland parts of Africa … seem in all ages of the worldto have been in the same barbarous and uncivilized state in which we find them atpresent” (Gallup et al 1999:132).

18 This representation of African poverty also obscures the contribution of shock therapy-inspired programmes to the exacerbation of poverty and conflict in sub-Saharan Africa(Harrison 2010b:100).

19 As such, the sublime object possesses the quality of the sublime as theorized by Kant—theencounter with a presence that can be sensed in “chaotic, terrifying, limitless phenomena”,but that transcends the powers of subjective representation (Žižek 1989:202–203).

20 The Report thus reproduces the basic assumption of the Post-Washington Consensus,according to which “It is not… the substantive irrationalities of marketized social relationsthat are causatively related to the creation and reproduction of poverty, but rather thefailure of poor people to adequately access and participate in markets owing to institutionaland social impediments” (Taylor 2004:19).

21 The countries participating in the Millennium Villages Project are Ethiopia, Ghana, Kenya,Malawi, Mali, Nigeria, Rwanda, Senegal, Tanzania and Uganda. These countries were se-lected for their established records of “good governance”, and the Millennium Villages arethus embeddedwithin neoliberal policy landscapes at the national level. The total populationof the Millennium Villages is approximately 500,000 (Millennium Villages Project 2011).

22 Other examples of neurotic neoliberals might include Joseph Stiglitz, Paul Krugman andNicholas Stern. Like Sachs, Stiglitz has made a name for himself as a critic of the neoliberalproject, but has remained wedded to its fundamentals. Stiglitz served as Chief Economistof the World Bank from 1997 to 2000, and masterminded its transition from Washingtonto Post-Washington Consensus, which he described as a shift from “shallow intervention-ism” to “deep interventionism” (Cammack 2004). Despite his current status as a rebornKeynesian, Krugman served as an Economic Advisor in the Reagan administration, andthen played a key role in the shift to the Post-Washington Consensus, through thedevelopment of his “new economic geography” (Wilson 2011). Stern has similarly evolvedfrom an orthodox neoclassical economist to a key architect of the Post-Washington Consen-sus, the Commission for Africa, and market-driven policy responses to climate change(Cammack 2006).

23 Sachs’s speech at Occupy Wall Street can be seen at http://www.youtube.com/watch?v=mB_eoUqbKDw (accessed 15 May 2012).

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