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specter is now haunting Indonesia: the specter of neoliberalism. I call it a specter, or ghost, because everyone is talking about it but few are really sure about what it is.

Neoliberalism is mainly referred to as a political economic system. However, for economists, it is not a common term to classify a set of ideas or policy orientation. One can find those claiming to be liberal, socialist, conservative, existentialist, Keynesian or neoclassical, who passionately defend the schools of thought they subscribe to, but I don't think there is anyone who considers her or himself a *neoliberal'. This is due to a feature of the so-called neoliberal philosophy: it is defined by its critics.

As the name suggest, neoliberalism is seen as the revival of Adam Smith's economic liberalism. The core philosophy of neoliberalism is that of liberalism: freedom for individual transactions, guided by market mechanisms where price is the signal to allocate resources based on demand and supply, minimum regulation and government intervention in the market, and the elimination of all barriers to exchange and trade.

So what is "neo" about neoliberalism? There is a spectrum of arguments raised by its critics. But they seem to converge on a couple of things.

First, neoliberalism seeks to expand and apply market mechanisms everywhere and in all aspects of life, with the help from government or international agency-driven policies. In other words, neoliberalism is top-down liberalism.

Second, typical neoliberal policies are summarized by the "Washington Consensus": tight fiscal policy, limited social spending, trade liberalization, privatization of SOEs, deregulation and legal security of property rights.

Third, neoliberal philosophy and policies are responsible for the recent global inequalities, poverty, marginalization and exploitation. Critics also point out that the (evil) neoliberal spirit has reduced humans to agents of market mechanisms. Transactions have become impersonal; cooperation and communalism is seen as inferior to competition.

While these criticisms have some points, they also tend to over-generalize. Market-oriented policies could have led to the creation, or the preservation, of poverty and inequality. But so could government intervention and a lack of market competition. On the other hand, introducing more market mechanisms could help alleviate poverty. Look at what has happened in India and China.

Market-driven innovations like the growth of IT industries may create inequalities, but the same innovations have also the potential to narrow that same division. Mobile phones have made the lives of farmers, small traders, fishermen and migrant workers in India and Africa much easier. They can make transactions faster, check the market for their commodities, and send remittance to their families through SMS banking.

In short, while it is true that poverty and inequality is a pressing issue, it is misleading, even disingenuous, to attribute it to a single ideology or system. We must evaluate the underlying reason and policy impacts, case-by-case. This is what most contemporary economic research is about. It is not about market versus government intervention, but which policies work better than the others.

Today, neoliberalism is becoming less of an academic term, and more of a pejorative label. Everywhere, neoliberal is associated with all the bad things under the sun. From global warming to underperforming soldiers, even to mutilation. This has created an inflated meaning of neoliberalism, which has made the term lose credibility.

This is a concerning issue. People are less appreciative of scholarly arguments, and more interested in attaching stigmas on other people. Consider one example of a classic academic debate: how to improve the wellbeing of the poor. We know that most of the poor are in the rural agriculture sectors. Thus, a typical response calls for the protection of the agriculture sector so that farmers will not face cheap competitors, and their revenue will be secured.

But such policies will then hurt farm workers - net consumers of rice but are the majority of farmers - and urban poor. Meanwhile, a "neoliberal" economist would suggest reducing the trade barriers for rice so we can buy rice more cheaply, and eliminate domestic market distortions so the gap between prices between producer and consumer is not too big.

In addition, the neoliberal economist would also argue for a more flexible labor market to ensure greater mobility from the informal to formal sectors. Most workers in the overcrowded rural labor market are trapped in the informal sector. But the formal job market has become more and more protected. This is good for those already in the formal sector, but it means even slimmer chances for the ojek (motorcycle taxi) drivers or casual workers to find more permanent jobs. Hence, it is not obvious which policies create poverty and which ones alleviate it.

This political labeling also creates another problem of its own. The boundary of neoliberalism and neoliberal policy is blurred. Many attacked the current government saying it was run by neoliberals when they increased fuel prices - mainly hurting the middle class. At the same time, the same government is still labeled neoliberal even though it provided cash compensation. The neoliberal-bashers' position became more unclear when they were unhappy at rice prices going down, but then also unhappy when rice prices were going up.

There are many scholarly critics of neoliberalism, some of whom I know and respect well. However, I find it annoying that the academic debate is hijacked by those using it for political labeling. This is a big challenge now for scholars, since despite the labeling, the "neoliberal" candidate still has the biggest chance of being democratically elected.