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Austin Is Ground Zero for a Different Kind of Neoliberalism

Known for its quirky institutions, eccentric characters, and progressive culture, Austin’s famous “weirdness” has long masked a deeper commitment to neoliberalism — which has in turn accelerated its de-weirding.

Festival goers are seen during Austin City Limits at Zilker Park in Austin, Texas. (Rich Fury / Getty Images)

In January, Elon Musk, Grimes, and Joe Rogan were photographed with Dave Chapelle during the comedian’s residency at Stubb’s Bar-B-Q, the revered Austin music venue in the iconic Red River live music corridor.

To the irritation of many locals, the three had joined the latest surge of transplants, many of them Californians, fleeing to a state with abundant local culture and no income tax. Rogan had relocated his podcasting operation to a house on Lake Austin in the summer of 2020, and Musk had followed just a few months later, building a Tesla facility outside Austin and a SpaceX launch site near Brownsville.

A comment on the Instagram post summed up a common sentiment about the trio’s arrival: “That ‘new’ Austin.”

Many Austinites read the gathering as emblematic of how the old Austin of creatives, musicians, weirdos, and dropouts — an island of idiosyncrasies in a sea of conservatism — was now, this time, truly dead and being supplanted by tech start-ups, interchangeable “offbeat” Rainey Street bars, and billionaires. A further implication seemed to be that Rogan and Musk, exponents of a sardonic libertarian-leaning brand of neoliberalism, were at odds with Austin’s essentially progressive identity.

But the new Austinites aren’t as out of place as they might seem, nor is Austin as out of step with the rest of Texas as it likes to pretend.

Political theorist Nancy Fraser has used the term “progressive neoliberalism” to describe the dominant political-economic paradigm of the past half-century, defining it as a synthesis of identity-based social movements and various financial sectors. In Fraser’s view, this synthesis represents an effort to render capitalism palatable, celebrating racial diversity and female empowerment while nevertheless supporting economic expansion and financialization that exacerbates inequality. For years, Austin has embodied this paradigm with pro-business policies and a socially liberal worldview.

“Progressive neoliberalism” may strike many liberals as the opposite of the Trumpism that gripped conservative parts of the state, but Fraser contends otherwise. Its cousin is “hyperreactionary neoliberalism,” a syncretic blend of libertarianism and authoritarianism sutured to the same business-friendly ethos at the heart of progressive liberalism. Progressive and hyperreactionary neoliberalism are not actually worlds apart; rather they are conjoined in their support for an economic agenda of aggressive privatization and deregulation.

In the post-Trump era, Texas is now the vanguard of hyperreactionary neoliberalism, and Austin’s cultural progressivism has done little to stem its rise. On the contrary, the city’s embrace of neoliberal ideology, even at its “weirdest,” paved the way for both the cultural homogenization of Austin and the recent revival of Texas’s timeworn reactionary right, a long-standing presence that dimmed in the 1980s only to reappear in full force today.

“I’ve Got Maps in My Room, and I’ll Do It someday”

Just over twenty years ago, the “Keep Austin Weird” campaign emerged as an effort by the Austin Independent Business Alliance to prevent a Borders Books and Music from edging out two of the city’s most adored institutions, Waterloo Records and BookPeople. But even in 2000, the university town’s neoliberal transition was already well underway. There had been a similar uproar two years earlier over the closing of Liberty Lunch, a shabby but beloved downtown music venue. Even then, people lamented the loss of the old Austin.

Keep Austin Weird was initially met with some success — Borders was thwarted and eventually went into liquidation in 2011, while Waterloo Records and BookPeople are still around. But it proved to be a minor victory in a lost war. While some of the city’s most important cultural institutions have survived, few would disagree that Austin has been aggressively de-weirded.

Due to extensive tax abatement packages and its promotion as a party town, Austin has become one of the fastest growing cities in the nation with one of the hottest housing markets — the median cost of a home in the city is now $425,000, a 29 percent rise over the previous year. Rents are equally dear, with apartments often hard to come by and annual increases sometimes as high as 30 to 40 percent. Gentrification is rampant, with many Hispanic and black minorities being displaced by “urban renewal” projects in East Austin.

While these changes have often been understood as bulldozing the city’s esteemed heritage, Austin’s cultural cachet emerged relatively recently. In the 1970s, the city was still very much a college town with less than a third of its current population. The few tech companies, like IBM and Texas Instruments, that dotted the outskirts were outliers. Unlike today, newcomers weren’t drawn by the tech industry but rather the university or the culture. Venues like Antone’s Nightclub, the Soap Creek Saloon, and the Armadillo World Headquarters served as Austin’s de facto salons, home to Waylon Jennings’s Outlaw Country and a thriving rock scene with bands like Roky Erickson’s 13th Floor Elevators and The Skunks.

In 1975, the city elected its “hippie mayor,” a thirty-year-old activist named Jeff Friedman, swept into office by a young, progressive, and diverse voting bloc benefiting from a recently lowered voting age. While the city’s protest scene never reached the heights of what was seen in Berkeley, California, or Madison, Wisconsin, in the 1960s, Austin in the mid-1970s saw a period of intense political activity with frequent marches and protests in support of laborers, farmworkers, and environmental issues. Through the decades, Austin would continue to have a reasonably healthy culture of activism, particularly the city’s LGBTQ community.

Eeyore’s Birthday, 2010. (Wikimedia Commons)

Along the way, Austin developed a number of cultural institutions that have lent the city its particular reputation for weirdness. Eeyore’s Birthday, an annual all-day celebration held in Pease District Park, began in 1963 as a university party and was later co-opted by local hippies who shifted the event toward drum circles, costumes, and body paint.

In 1974, Bill Arhos, Bruce Scafe, and Paul Bosner created Austin City Limits, a nationally syndicated and immensely popular music showcase originally recorded in Communications Building B of the University of Texas (UT) on Guadalupe Street. Focused predominantly on the local music scene, the show would host acts from across the industry. It now records in a new dedicated theater downtown.

Emerging a few years later in 1987, South by Southwest originally started as a music festival spread across a rainy week in March, but, in keeping with the city’s transformation, eventually grew to a three-festival event, focused not only on music but also film and tech. It now brings upward of four hundred thousand visitors to the city.

Despite changing eras and sensibilities, these and other Austin institutions shared, at least initially, a seeming commitment to idiosyncrasy and self-expression. Openly antagonistic to corporatization and governmentality, Austinites tended to be politically liberal, but theirs was a unique form of leftism inflected by anarchist and libertarian sentiments.

Comedian Bill Hicks, who spent time in Austin before his death in 1993, characterized this mentality when he joked about Branch Davidians cult leader David Koresh: “Frustrated rock musician with a messianic complex, armed to the teeth and trying to fuck everything that moves . . . sounds like every one of my friends in Austin.”

Richard Linklater’s Slacker, shot in 1989 and released in 1990, also captured aspects of this attitude in the years before the city’s acceleration. Archetypically Generation X, the meandering film depicted Austin as a home for politically minded but mostly directionless and disaffected misfits, and dramatized their resistance to the careerist, capitalist mentality of larger cities.

Slacker also focalized the city’s simmering political tensions. In one of the most memorable scenes, an old anarchist played by UT philosophy professor Louis Mackey interrupts a burglar in his home and, rather than calling the police, leads him on a tour of the center of town. Gesturing toward the capital, Mackey says:

Just look at that shit. I’ve always dreamed of pulling a Guy Fawkes on the Texas Legislature. Just blow the damn thing sky high. I’ve got maps in my room, and I’ll do it someday. Texas is so full of these so-called modern-day libertarians, with all their goddamn selfish individualism. Just the opposite of real anarchism. They don’t give a damn about improving the world.

While capturing anti-governmental views of many of the city’s renegade intellectuals, the scene is also darkly prophetic about the influence that “modern-day libertarians” would have in the years to come. Just a few years after the film, Texas Republicans would scheme to supercharge the economy, mostly through tax abatement programs.

Detaxation, Baby

While many factors contributed to Austin’s cultural and economic transformation over the following decades, some of the most consequential and lasting have been the efforts of state Republicans to implement corporate subsidy programs. As a means of drawing business to the state, the tools were unimpeachably successful. But they’ve also been accompanied by massive environmental cost, rising income inequality, and, indeed, cultural homogenization.

In 1991, after losing a bid to attract Intel, Texas lawmakers created Chapter 313, an inducement program that, over the next thirty years, would offer property tax abatements to dozens of companies to relocate from out of state. Over the years, the program has been used to distribute nearly a billion dollars to a variety of companies, including, most recently, Elon Musk’s Tesla.

George W. Bush became governor of Texas in 1995, offering a raft of nearly bankrupting tax cuts that, by most accounts, were otherwise ineffective. Rick Perry, who took office in 2000, would be far more impactful. As a New York Times investigation found in 2012, Perry distributed a staggering $19 billion dollars a year in direct subsidies to companies, far more than any other state at the time, inducing corporations like Apple, Caterpillar, Facebook, Toyota, eBay, and others to either move to Texas or expand in the state. Notably, despite the enormous size of the subsidies, the companies underdelivered on jobs and failed to keep development promises.

Nevertheless, during Perry’s tenure, the state significantly increased jobs, with employment rising by 2.2 million. It was also a period of change and growth for Austin’s culture. With money and transplants pouring in, the city’s nightlife district spread across I-35 into East Austin, displacing many minority-owned businesses. It was also a period of vitality for the city’s restaurant scene.

However, in contrast to the previous era, this new age of Austin’s culture was deeply informed by the values and tastes of progressive neoliberalism. It was an era when Aaron Franklin of Franklin Barbecue, arguably the lodestar of the new food culture, could appear in a commercial for the Chase Sapphire Preferred card alongside Nobu Matsuhisa without backlash or a hint of irony.

Greg Abbott, who took office as governor in 2015, has continued the trajectory of the prior administration in making Texas a welcoming site for corporate relocation by offering enormous corporate tax incentives. Companies such as Oracle, Samsung, HID Global, and Charles Schwab have all been lured under Abbott. Yet, emboldened and empowered by the Trump administration, the governor’s rhetoric, policies, and executive orders, particularly in the 2021 legislative session, have demonstrated a sharpening far-right turn resonant with Fraser’s conception of hyperreactionary neoliberalism, or Trumpian capitalism.

First as a candidate and then as president, Trump garnered support by highlighting the hypocrisy of progressive neoliberalism. But, rather than make good on its empty promises of social equality, he showed hostility to the entire premise. With Trump now out of office, several Republican governors have sought to extend his political legacy by instituting reactionary social policies in their states. Florida’s Ron DeSantis is one figure practicing what has ominously been called “competent Trumpism.” Abbott, however, is both the most dogged and the most successful in this pursuit, instating policies restricting voting and abortion rights while seeking to eliminate COVID restrictions as well as firearm regulations.

This September, among a flurry of far-right legislation, Abbott signed a permitless carry law and a “near-total” abortion ban that permitted suing those abetting women in obtaining abortions after six weeks by so-called “bounty hunters.”

Additionally, Abbott recently signed an executive order banning mask mandates in the state; approved a nearly $2-billion border funding package, including a $750-million allotment for the border wall; and passed a law eliminating previous measures easing voting, particularly for minorities. The latter prompted dozens of House Democrats to break quorum and flee the state to prevent passage of the law. On these developments, Casey Boyle, associate professor in the Department of Rhetoric and Writing at UT Austin, notes that the state is “becoming the new model for how other conservative states might operate.”

Texas Republican governor Greg Abbott. (Montinique Monroe / Getty Images)

Like Trump’s own bizarre contradictions between libertarianism and authoritarianism, Abbott has frequently found himself on unsteady footing between his encouragement of unimpeded economic growth and his institution of conservative social policies.

In April 2021, Abbott condemned Facebook as “un-Texan” for removing content it deemed as hate speech — in September, making good on the condemnation, Abbott ratified a law that would prohibit social media companies from banning conservative content. However, despite these public denunciations, he reportedly remained in private negotiations with the company in efforts to bring a second data center to the state and, like with his other endeavors, was working to provide the company with generous tax incentives. Abbott’s conflicting policies accordingly conform, in part, to Fraser’s notion of hyperreactionary neoliberalism in that they are “contrary, chaotic, unstable, and fragile.”

Unsurprisingly, many in the business world have publicly opposed these policies. Apple CEO Tim Cook committed to helping employees travel to other states for abortions. Many also suspect that these and similar policies may have a chilling effect on the growth of the local tech scene. Beyond the tech world, at least one prominent figure, Wire creator David Simon, has refused to film in the state because of the new abortion law.

And yet Abbott’s policies haven’t appreciably dampened enthusiasm for Texas. Californians are still arriving. In 2021, Austin emerged as the number-one place in the country for commercial real estate development. As Rogan and Musk’s relocations indicate, those with strong neoliberal sensibilities have been thus far undeterred. Perhaps the most compelling reason for this is that while hyperreactionary neoliberalism enacts deeply conservative social policies, it is nevertheless cut from the same cloth as its predecessor and is largely compatible with it.

“The Strangest City in America”

There are two important implications of Austin’s long trajectory and its most recent turn. First, it indicates that Austin’s transformation was never just a matter of culture. The city and state’s neoliberal transition solidified corporate and conservative control at both the city and state level, weakening not only the city’s culture but allowing Republicans to more deeply entrench their agenda. This cleared the way for the state’s eventual Trumpian turn and has helped to protect lasting Republican control of the state.

Second, Austin’s popularity, growth, and enduring reputation as “The Strangest City in America” suggest that the city’s supposed weirdness was perhaps never as progressive as many believed it to be, and perhaps that the city’s identity was, in many respects, often only nominally progressive and frequently unaware of the limitations of its worldview. Musician and writer Kinky Friedman offered a similar conclusion in 2004: “In my bright college days we pretty much took for granted that Austin was far more progressive than the outlying provinces. Looking back, I’m not so sure that was entirely true.”

The starkest example of this lies in the city’s history of discrimination. As a consummate Southern city, Austin long maintained racial segregation through zoning laws and, later, through redlining. Construction on I-35 began in the 1950s, cutting a border between the wealthier white neighborhoods to the west and black and Latino neighborhoods to the east. Even into Austin’s progressive period, racial boundaries were often starkly maintained.

Writing for Texas Monthly in 2013, Cecilia Ballí, then an assistant professor of anthropology at UT, noted that while the city “prides itself on its cultural liberalism and sophistication,” it has preserved various forms of racial segregation.

Further problems include the reverence many in the city have afforded to conservative figures who emerged from Austin’s cultural scene but nevertheless embodied a local variant of the “Californian Ideology.” Whole Foods CEO John Mackey is an emblematic example. Whole Foods opened in 1980 as a single-location neighborhood store on North Lamar and initially distinguished itself by its commitments to environmentalism, organic food, and the humane treatment of animals.

These surface-level progressive values masked Mackey’s deep commitment to neoliberalism. Amazon bought Whole Foods in 2017, and since then, Mackey has vocally opposed unions and government-funded health care. He told the New Yorker in 2021, “I believe in capitalism. I believe it’s the greatest system for helping humanity to be advanced that’s ever been created.”

An even starker example is Alex Jones, who many locals remember from his appearances on Austin’s Community Access Television (CATV) in the 1990s. As Harmon Leon explains in a 2019 profile for Observer, Jones appeared alongside a cavalcade of other local eccentrics and became a cult figure for his entertainment value. Charlie Sotelo, a former CATV producer, recalls that Jones, in those days, “was a joke.” And yet, despite his obvious flirtations with conservative ideology, it was precisely because Jones cut a familiar, antiestablishment figure that he seemed part and parcel of Austin’s defining ethos, so much so that he was featured in Richard Linklater’s films Waking Life and A Scanner Darkly.

It wasn’t until a few years later that the full scope of Jones’s politics would emerge as he transitioned from an anti–police state libertarian to a far-right figure. Jones has since denied the Sandy Hook Elementary School shooting, remarks he was sued for, and propagated the Pizzagate conspiracy. Linklater, who claims he always “just thought [Jones] was kind of funny,” professes confusion regarding the InfoWars host’s later Trumpian turn. Nevertheless, Jones’s conservatism and his antipathy toward the Left, personified in the early years by his sneering animosity toward local government, was always apparent, even in his days at CATV.

These and other examples of Austin’s tolerance for reactionary politics complicate narratives of the city’s weirdness. While Austinites have supported various leftist issues over the years, the city’s eccentricity has occluded or distorted conservative elements. Examples of the failings of Austin’s cultural identity also demonstrate that figures like Musk and Rogan, despite seeming deeply at odds with Austin’s progressive identity, may in fact be well matched to the city in their contrarian and anti-governmental brand of neoliberalism.

This is not, however, to suggest that Austin should be simply dismissed. The city, for all its flaws and the imperfections of its sense of weirdness, has offered a vital sense of community to many, particularly its musicians. Hudson Mueller, a Brooklyn-based musician who grew up in Austin, recalls of the city in the early 2000s:

There was also a great jam culture in Austin at the time. If you hung around long enough, somebody would invariably say something like, “After the gig, we’re all going to Daren’s house for the Ham Jam, and we’re gonna stay up ’til sunrise playing swing tunes with Slim Richey,” and off you go.

However, a progressive future for the city can’t rest on the preservation or revivification of a sense of the weird. For Fraser, the answer lies in a coalitional “progressive populism” that makes class its central concern.

The rampant overdevelopment of Austin over the past two decades can’t be undone, but progressives can continue to fight corporate welfare. Likewise, Abbott’s policies, both existing and future ones, can be fought legislatively and through grassroots activism. Local resistance in Austin to Abbott’s various bills demonstrates that they remain unpopular and that there is a collective will to combat them. Labor activists, while not currently a massive coalition in the state, nevertheless maintain a vocal presence. It is these strains of a political left in the state that offer hope for a different kind of city, and perhaps a different kind of Texas.