Published September 9, 2004 in FrontPageMagazine

Liberalism: History and Future

by Barry Loberfeld

The principles that have classically defined liberalism -- the primacy of the individual; the distinction between civil society and the political state; natural law and natural rights; political equality and limited government; private property and free enterprise -- existed in piecemeal form at various times before the advent of John Locke. We may think of the Greek Sophists, the Roman Stoics, the biblical separation of Caesar and God, the Spanish Scholastics, Milton, Spinoza. And among the key examples of practice that preceded theory are Magna Carta of England, Magdeburg law of Germany, the Golden Bull of Hungary, and the toleration of seventeenth-century Holland. But it is in Locke that the philosophy of liberalism finds its fountainhead. With his Second Treatise on Government, he distilled these principles from his precursors and linked them together into a practical framework for contemporary government -- that is, as a confident creed to challenge royal absolutism:

Among the links was one between political liberty and private property, which would take the world stage in a single year not even a century later. In 1776, the American colonists issued a Declaration of Independence that echoed Locke for all its central themes, and Adam Smith published his Wealth of Nations, the work that founded the science of economics with its demonstration of the productive superiority and universal benevolence of the free market. Liberalism was evolving from the proposals of philosophers into the policy of governments. (The term itself eventually came from the Spanish parliament's anti-monarchist Liberales of the 1820s. Marx soon after added "capitalism" as a synonym.)

The century of 1815-1914 is widely recognized as the liberal epoch, a period of industrial progress, unprecedented growth in both population and living standards, expansion of individual liberties and social tolerance, the abolition of slavery and serfdom, a reprieve from major wars, and the waning of political authoritarianism. "Until August 1914," observed British historian A. J. P. Taylor, "a sensible, law-abiding Englishman could pass through life and hardly notice the existence of the state." The government did not control how he lived, where he lived, where he traveled, what he purchased, whom he traded with, or whether he should enlist in the military. "It left the adult citizen alone." Such is the laissez faire that comes to mind when we speak of classical liberalism.

And so the question arises: How did liberalism transform, moving to our American context, from a term denoting a policy of Jeffersonian domestic freedom and Washingtonian foreign nonentanglement into a synonym for what has been called the "welfare-warfare state"? How did a "liberal" go from being an advocate of limited government to being one of expansive statism? Was this change substantive or semantic, i.e., an example of ideological evolution or an act of terminological theft? Proponents of the latter theory included the economist Joseph Schumpeter, who quipped, "As a supreme, if unintended, compliment, the enemies of private enterprise have thought it wise to appropriate its label." That the "new" liberalism was in many ways part of the collectivist reaction against the old was not something that these "enemies" would (or even could) outright deny. Indeed, in August 1934 The Nation opined that "the New Deal in the United States, the new forms of economic organization in Germany and Italy, and the planned economy of the Soviet Union" were all strands of the trend "for nations and groups ... [to] demand a larger measure of security than can be provided by a system of free enterprise." Even earlier, John Dewey stated that the "reconstruction" of society by the American electorate "would signify that we had entered constructively and voluntarily upon the road which Soviet Russia is traveling with so much attendant destruction and coercion." And yet he called himself not a Marxist but a liberal -- a "new" liberal -- and his ideas not collectivism but individualism -- a "new" individualism. Evidently this terminology served double duty by separating American statism from the tyrannies of its European counterparts and associating it with the glories of our Western and Revolutionary heritage. "Liberalism" was the proverbial velvet glove.

There are two more points to be made for the case for label-theft. One is that, in contrast to the Anglo-American world, the term largely retains its meaning on the Continent, where a “liberal” is still one who is pro-laissez faire. It would be a difficult task indeed to promote welfarism as "new" in a land where "poor laws" go all the way back to Rome. The other is the simple fact that the term really never lost its original meaning completely. When we speak of the U.S. or the U.K. or even Sweden as a "liberal" democracy, the term refers to the large measure of political freedom and private property that still constitutes the base of each nation, not to the overlaying socialistic programs that burden that base.

The contention that the change in liberalism's meaning represents a change in liberal thought is always made in reference to a single thinker: John Stuart Mill. Contrary to a popular impression, Mill never adopted socialism and actually grew more critical of it (cf. his unfinished Chapters on Socialism). His real break with (rather than "development of") liberal theory was the proposition that the distribution of wealth, unlike its production, was not subject to natural economic laws or property rights: "The things once there, mankind ... can do with them as they like." The resulting formula -- private production but political redistribution -- is easily recognizable as the contemporary Anglo-American model. In 1905, legal scholar A. V. Dicey taught that Mill's dissent was "in England, to a great extent, the cause of the transition from ... individualism ... to ... collectivism. His teaching specially affected the men who were just entering public life towards 1870. It prepared them at any rate to accept, if not to welcome, the collecti[vism] which from that time onwards has gained increasing strength." Eventually, those disciples of that collectivism (such as L. T. Hobhouse) who opposed Fabian imperialism and Shavian authoritarianism would point to Mill and claim their own collectivism to be the scion of liberal ancestry -- which seems to bring us back around to the velvet glove.

However, in terms of both semantic usage and governmental policy, "liberalism" is most widely associated today with a single concept: the mixed economy, i.e., a state that is neither completely capitalist (laissez faire) nor totally socialist (totalitarian). It is, to be sure, a union of conflicting -- liberal vs. anti-liberal -- elements. As F. A. Hayek, the great twentieth-century scholar of liberalism, observed: If we have the redistribution of wealth, then what of private property? If we enact biased laws to effect economic (or "social") equality, then what of political equality? If we regard the collective as the essential entity (which Hayek called "anthropomorphism or personification"), then what of the primacy of the individual?

To be capitalist or to be socialist? -- that is the question. Precisely what is the mix of the mixed economy? When is it capitalist and when is it socialist? When does it protect property and when does it confiscate it? When does it leave people alone and when does it coerce them? When does it adhere to the ethics of individualism and when does it obey the code of collectivism? And just which is the metaphysical primary -- the individual or the collective (e.g., the nation, the race, the class)? The fundamental truth about the mixed economy is that mixed practices imply mixed principles, which in turn imply mixed premises -- i.e., an incoherent grasp of reality. With socialism, the chaos was economic; with "social democracy," it's epistemological. Ultimately, the latter can no more generate rational policies than the former could generate rational prices. The mixed economy doesn't present us with a mosaic portrait of the just society, but with a jigsaw of pieces taken from different puzzles.

And it is just that jumble that constitutes the modern liberal welfare state. Consider its exemplar, the "liberal," who supports laissez faire for social (i.e., cultural) issues but statism for economic issues. The soundness of this position is best demonstrated by how easily it is inverted by his putative opponent, the "conservative," who supports laissez faire for economic issues but statism for social issues ("social-issues socialism"). Both, however, belong to a generation now gone. As if ideology possessed its own laws of genetics, inconsistency has begotten only more inconsistency. Among the present generation we behold liberals who no more support free speech (e.g., Catharine MacKinnon) than their conservative peers support free trade (e.g., Patrick Buchanan). We see people who

We can have a veritable "Heinz-57" of possible positions if we consider the multitude of thinkers, activists, and voters, and the only unity that comes out of all this division is the implicit creed they share:

  1. Give us the tax dollars and the tax breaks, but give them the tax bill.

  2. Give us liberty, but get those perverts!

After all, while there is a myriad of voices clamoring for censorship, who ever says, "There have to be some limits on free speech, and we should start with mine"? Among all the calls for protectionism, do we ever hear, "You know what? Give the competition the subsidies. Me, I'll bear the rigors of the market"? Capitalist freedoms and socialist entitlements for me, but socialist restrictions and capitalist responsibilities for thee -- that becomes the mix of the mixed economy. Such is the "idealism" that distinguishes contemporary liberalism from the "selfishness" of classical liberalism and its establishment of the same rights for oneself and one's neighbor.

As universal principles, the self-interest of capitalism and the self-sacrifice of socialism have both given way to the "special interests" of pressure groups. Consequently, we no longer really have political philosophies so much as political lobbies hiding under the wool. Feminism is perhaps but one of the more obvious examples. This is not an ideology but an advocacy group that will say whatever its takes to load the dice in its members' favor. Chants of "privacy" and "choice" are sufficient to establish a "woman's right to control her own body" (abortion), but not enough to establish a man's right to control his own mind (free speech). The politics of prohibition? While feminists widely dismiss that notion that the outlawing of guns will mean that only outlaws will have guns, they regard virtually as divine revelation the notion that the outlawing of abortion will mean that only outlaws ("back-alley butchers") will perform abortions. (Their conservative opponents, who ostensibly flip the issues, share this fair-weather recognition of the law of unintended consequences.) And while they oppose individualism and defend popular democracy, does the former find a better friend -- or the latter a fiercer foe -- than the feminist fighting to maintain the wall of separation between Abortion and Plebiscite?

When a principle or premise defends one's case, it is affirmed; when it doesn't, it's denied. Think about these two statements:

So, which does our "liberal" believe in? Well, if the issue's smoking, the second. But if it's "sodomy," then the first. And the "conservative"? Just the reverse. What prevails is a now-you-see-it-now-you-don't commitment to any tenet. Moral integrity falls to personal prejudice, and hypocrisy becomes the standard of "social democracy."

Soon enough, however, such hypocrisy on everyone's part becomes impossible to miss, as witness the exchange of barbs on the sundry "debate" shows. And "victimology" -- of which the above feminism is definitely one of the more obvious examples -- collapses when everyone eventually claims (on one basis or another) victim status. The "end of ideology" truly has arrived. Laws are passed, not with reference to philosophic principles, but only with an eye on the polls; "social democracy" devolves into majoritarian democracy -- a one-party democracy, where Republicans and Democrats "run towards the center" as closely as possible. Realizing James Madison's great fear in Federalist No. 10, the country has come to that stage where "measures are too often decided, not according to the rules of justice, and the rights of the minor party; but by the superior force of an interested and over-bearing majority."

There is, of course, another conceivable direction for the mixed economy: the opposite one, i.e., a move towards ideological consistency, be it capitalist or socialist.

We'll examine the second possibility first. The name Ludwig von Mises gained currency during the demise of the Soviet Union because many (e.g., Robert Heilbroner, who was generally not known for his sympathy to free-market theories) pointed to his prediction that a socialized economy could only decline because its abolition of the market robbed itself of any means to rationally calculate prices and thus determine production. But the Austrian economist also made another stark prediction -- that a mixed economy could not help but move towards total control. His argument ran like this: Imagine that the first control mixed into the economy is a price ceiling on the sale of milk, since the politicians promised to make it more affordable. What invariably follows is that the marginal producers of milk go out of business; milk actually becomes less plentiful. Now the politicians can repeal this control -- or they can impose a new one on the "factors of production necessary for the production of milk ... But then the same story repeats itself" on a wider level. If the latter course is chosen, we logically head towards socialization of the entire economy.

Let's move from milk in theory to medicine in practice. For about a hundred years, America has been a nation of accumulating medical controls. Each new regulation was passed with the same justification made for the previous one: This measure will sufficiently correct the failings of the free market and thus save the free-market system. And the result? Today's "crisis in health care" -- as the welfare statists themselves call this iatrogenic disease. The more band-aids are applied, the more wounds appear! And with nothing but band-aids in their bags, these "liberals" (often the same aging advocates of past regulation) can now prescribe only covering the patient head to toe -- i.e., the final move to the outright socialization of all medicine. What this says about the microcosm of medicine is obvious; what it means for our mixed economy is ominous.

What limits the limited welfare state? Even with socialism discredited both theoretically and practically, state control over society grows. Do the apologists for government intervention imagine that we can move asymptotically towards the electrified fence of totalitarianism without ever touching it? This political progression has its semantic parallel: As the nation encompasses greater government control, so does the meaning of “liberalism.” When the term (like the country) shifted from laissez faire to interventionism, with the advocates of the former renamed “conservatives,” both the term and the policy continued down that road -- unstoppably: Progressivism, the New Deal, the Fair Deal, the New Frontier, the Great Society. When some liberals (including a few leftists-turned-liberals) in the 70s opposed any further move beyond the "alphabet soup" (FDR-JFK-LBJ) consensus, they suddenly became "neoconservatives." A person wasn't a neoconservative because he rejected Hubert Humphrey liberalism in favor of a return to Jim Crow, but because he clung to its opposition to quotas and "affirmative action" in the face of the absorption of such programs by the "liberal" juggernaut. And when that juggernaut then absorbed the sunny disposition towards the Soviet Union of George McGovern and his supporters, "neoconservative" pushed out even "Cold War liberal" as a term to denote Henry Jackson and the older (now former) liberals. Any number of persons and publications (e.g., The New Republic) went from "liberal" to "neoconservative" merely by standing still. Despite both hope and hysteria over the possibility of the contrary, "liberal" policies expanded in the Reagan-Bush era, and by the 90s the term itself had hit the fence -- and plowed through. Now no one was too left to be "liberal." Radio personality Rush Limbaugh used it to describe the once "radical" William Kunstler, and literary theorist Stanley Fish, a "politically correct" leftist who nonetheless is himself often labeled a "liberal," tagged civil libertarian Nat Hentoff, once the prototypical liberal, as "right wing" -- for his uncompromising defense of free speech. One wonders drolly if in a few years the only "liberal" left in the Western Hemisphere will be Economic Democrat for Life Fidel Castro.

That last thought returns us to the question: What limits the limited welfare state? Not only has "liberalism" meant ever greater economic controls, but now it means the application of socialist ideology to social issues. This has always been a dubious dichotomy -- Is a book a manufactured product or an expressed idea? -- and one that didn't exist among either the classical liberals or the Marxist regimes. Yet a surging number of voices tell us that "equality" demands, not only a redistribution of wealth, but also the banning of speech -- not only an end to "economic violence," but also the suppression of "verbal violence." How this rhetoric translates into reality can be glimpsed by looking north. The legal perversity that pornography constitutes the criminal "exploitation" and "objectification" of women -- a linguistic legerdemain whereby bourgeois feminists exculpate their own capitalist occupations as the "exploitation" and "objectification" of the proletariat, thus metamorphosing themselves from class oppressors into gender victims -- was affirmed by the Canadian Supreme Court. This idea, in turn, evolved into that of "hate speech," which was extended to "protect" other groups, such as homosexuals. So now when the Rev. Jerry Falwell airs his show in Canada, he must edit his preachings on homosexuality, which are not protected by freedom of religion or freedom of speech. Here is a "welfare state" that has gone well beyond taxing millionaires to house orphans.

It's all really very easy to understand as the philosophic analogue to Mises' economic analysis. The initial introduction of a socialist law into a liberal society forces the question: Do we accept or reject this violation of the liberal ethic? If we accept it, we set a precedent for the next proposed socialist law. We have made a very clear moral decision -- collectivism trumps individualism. In contrast to the cynicism that leads to a deluge of special interest groups, this trend involves taking ideas seriously -- i.e., recognizing the mutual exclusiveness of the capitalist and socialist paradigms, and thus the imperative to choose one. It acknowledges the hypocrisy -- the incoherence -- of bringing the socialist outlook to issue A but not issue B, to the "economic" issue but not the "social" issue.

A commitment to greater statism begets more such commitments, and if what we may call the Ronald Dworkin generation pooh-poohed the "silly proposition that true liberals must respect economic as well as intellectual liberty," the Cass Sunstein generation repudiates as even sillier the proposition that liberals cannot impose on the free market of ideas the same doctrines and controls they impose on the free market in widgets. (The esteemed professor has insisted that speech, like commerce, must have its own "New Deal." With Sunstein as thought control's FDR, who will be its LBJ?)

As the no-end-in-sight march of greater government demonstrates, there is no reason to think that democracy is a check on despotism. An electoral majority can indeed embrace the concept and agenda of unlimited statism. "Totalitarian democracy" exists, not merely as a troubling construct, but as a threatening possibility.

Another possibility, however, is that people might take the idea of liberty seriously. By the end of the twentieth century, "the planned economy of the Soviet Union" finally followed into oblivion "the new forms of economic organization in Germany and Italy." A general respect for a foundation of private property and a market economy emerged among both intellectuals and the populace, edging out hopes for socialism with any kind of face. This was due in part to the lessons of Communist experience, in part to the renascent teachings of Mises and Hayek. Free-market economists have made their influence felt in everything from history (debunking the canard that unregulated "market forces" caused the Great Depression) to theory (refuting the general theories of John Maynard Keynes, the Marx of the mixed economy) to policy -- the rise of free trade between nations (even though the actual treaties often muddle free trade with pages of protectionism). An indication of this trend can be found in the latest edition of The American Heritage College Dictionary, which, in addition to a "political theory favoring civil and political liberties," further defines liberalism as an "economic theory in favor of laissez-faire, the free market, and the gold standard." Possibly as a reaction against this recent semantic development, diehard proponents of statism on the left have taken to once again calling themselves "progressives" (e.g., Ralph Nader, a "liberal" until late). As a practical challenge to the welfare state, only New Zealand in the mid-80s (and Thatcherite Britain, to a lesser extent) succeeded in cutting government down to a significantly smaller size. But the ideal of laissez faire continues to thrive, most notably within the libertarian movement, which poses a challenge on all levels to the dog-eat-dog grapplings of the special interest groups. In doing so, they are reflecting the wisdom of one of their classical liberal forebears, himself something of a founder of a new "movement," who warned that whenever "we depart from the principle of equal rights, or attempt any modification of it, we plunge into a labyrinth of difficulty from which there is no way out but by retreating."


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