DLT: Economic Liberalism

Duncan Brack and Ed Randall, authors of the Dictionary of Liberal Thought, have kindly agreed to let us publish extracts on Lib Dem Voice. This month we continue our trilogy of postings on liberalism – classical, economic and social. Last month it was classical; this month, it’s economic. You can read other previous extracts on LDV here. The entire book is available on Amazon here and can also be bought at the Westminster Bookshop.

Economic Liberalism

In political terms, economic liberals proclaim their belief in individual freedom and free markets; they support a reduction in the role of the state, particularly in the spheres of economic management and social welfare. The term is often used interchangeably with classical liberalism and that entry should be referred to for a summary of the economic liberal position.

The term ‘classical liberalism’ itself tends to be associated with nineteenth-century approaches to political and economic questions, such as that of the Manchester School. The label ‘economic liberal’ has been more commonly used in modern times, in particular to contrast such individuals’ views with those of social liberals, who are more willing to accept the case for state intervention as a means of promoting freedom. Economic liberals point to the dangers inherent in such state action, including the growth in bureaucratic power, the threat to civil liberties from an overweening state, and the potential reduction in economic competitiveness.

Although the British Liberal Party/Liberal Democrats are in general viewed as a social liberal party, there have been and remain some tensions between social and economic liberals, explored in the entry on social liberalism. That entry also explores why continental European liberal parties tend to be more likely to identify themselves as ‘economic liberal’, although several European countries possess both social liberal and economic liberal parties.

The term ‘economic liberal’ – or ‘neo-liberal’ – has also been used to describe the economic and trade liberalisation policies of the ‘Washington consensus’ promoted in particular by the International Monetary Fund, involving a withdrawal of state involvement in the economy and a reduction in trade barriers.

Duncan Brack

The Dictionary of Liberal Thought is one of the many titles available from the Liberal Democrat History Group. Find out more about them on their website.

Read more by .
This entry was posted in Dictionary of Liberal Thought.
Bookmark the web address for this page or use the short url http://ldv.org.uk/13570 for Twitter and emails.
Advert

6 Comments

  • Peter Bancroft 18th May '09 - 11:13am

    I’ve agreed with the new dictionary on controversial areas so far, but surely this description leaves out the actual cornerstone of economic liberalism?

    It is not important that some people happen to identify as economic liberals – what is important is that there is a more than century old political philosophy on economics involving free trade, access to markets and market-led mechanisms (e.g. price of energy dependent on supply & demand, not a Parliament vote).

    Yes, this is related to the Washington consensus (in the same way as Marxist economic theory is related to the 1939 5 year plan in the USSR), but relatively casually.

    Politically, there is also no addressing of the question of whether “social liberals” are “economically liberal” – i.e. liberal when it comes to the economic sphere, just as they are liberal on personal and social issues. Most clearly are – few “social liberals” want to nationalise major industries, unfloat the currency, put up more trade blocks to Africa, increase power of collective national pay bargaining, etc. Nor do they want to take apart the competition commission, spend state money on financing large corporations, using state money to give our corporations overseas, promote national champions, etc.

  • Duncan Brack 21st May '09 - 12:45am

    I’d accept this is a fairly slim entry, but that’s because we felt we’d covered the ground already in the ‘classical liberalism’ entry, which is already up on LDV. And you’ll see some of thw

  • Duncan Brack 21st May '09 - 12:48am

    [don’t know why I was cut off there!] … some of the questions that Peter Bancroft raises dealt with in the ‘social liberalism’ entry, which will be next up.

    Outside the party, the term ‘economic liberal’ IS often used to refer to the Washington consensus, so we thought we ought to mention it.

  • Geoffrey Payne – “economic liberals… believe in light-touch regulation”. I’m not entirely sure about that. There have been plenty of economic liberals in our party who advocated pretty extensive regulation. Look at the whole Ownership for All movement of the Thirties and Forties.

Post a Comment

Lib Dem Voice welcomes comments from everyone but we ask you to be polite, to be on topic and to be who you say you are. You can read our comments policy in full here. Please respect it and all readers of the site.

If you are a member of the party, you can have the Lib Dem Logo appear next to your comments to show this. You must be registered for our forum and can then login on this public site with the same username and password.

Your email is never published. Required fields are marked *

*
*
Please complete the name of this site, Liberal Democrat ...?

Advert



Recent Comments

  • User AvatarJohnTilley 21st Dec - 9:00am
    14 women have been appointed to the HofL by Clegg, according to this helpful briefing - http://www.parliament.uk/Templates/BriefingPapers/Pages/BPPdfDownload.aspx?bp-id=LLN-2014-008 Which also includes the following -- 978 party...
  • User AvatarDenis Mollison 21st Dec - 8:56am
    @TonyGreaves Thanks for your thoughtful contribution, but NOT "open party lists for European elections", please. This was proposed in the constitutional motion at a recent...
  • User AvatarJohnTilley 21st Dec - 8:35am
    "....Or would they just shoot everyone in sight including doddery old peers caught in the cross-fire across the House of Lords Car Park?" This approach...
  • User AvatarJohnTilley 21st Dec - 7:50am
    Tony Greaves According to this website -- http://www.parliament.uk/mps-lords-and-offices/lords/composition-of-the-lords/ There are 105 Liberal Democrats in the HofL. 4 are hereditary. (I assume all hereditary peers are...
  • User AvatarJohnTilley 21st Dec - 7:11am
    "...........a Liberal Democrat initiative led to the unitary council taking the first steps to revert to a committee structure." Just like Sally Hamwee I’m of...
  • User AvatarChris_sh 20th Dec - 11:38pm
    @Paul Walter Apologies if "political types" offends you, it was intended as a term to include everyone from the PM down to the lowliest door...