Whereas postwar German neoliberalism emphasized a strong state, U.S. neoliberals worked hard to narrowly define the areas in which a strong neoliberal state could ascertain its pro-capitalist power and roll back the New Deal advance of social liberals and trade unionists. Chicago became the key staging ground for forging a lasting alliance between neoliberal intellectuals and the corporate opposition to the New Deal. Contrary to the widespread belief in a continuous history of the Chicago School, Rob Van Horn and Phil Mirowski in Chapter 4 document the central roles played by Henry Simons and Friedrich von Hayek in founding the Chicago bastion of neoliberalism. The combined effort of these two intellectuals succeeded in establishing the Free Market Project in Chicago at the behest of the Volker Fund. Volker's president, Harold Luhnow, hoped to obtain an American version of Hayek's Road to Serfdom and was willing to fund the academic positions of Aaron Director and Hayek, as well as subsidize travel money for American participation in Mont Pèlerin Society proceedings in Europe. But more importantly, a specific Chicago version of young and radical neoliberalism emerged during the 1950s, which differed markedly both from the liberalism of the older generation of Chicago-based scholars like Simons and Knight, and from the Austrian economics and philosophy Hayek promoted. The chapter demonstrates that the second Chicago School and the Mont Pèlerin Society were substantively parts of one project rather than different parallel projects.

Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin, loc. 155