Opinion: The myth of classical liberalism
Written by John Dixon on 28th July 2007 – 1:39 pm‘To give is Liberality,
In him that shuns two contraries;
The one is prodigality,
The other hateful avarice.’Cervantes – Don Quixote, the 2nd part, 1614
I have been pondering a while over how to approach this subject. And, although I have only just got back from hospital, I feel that I am now ready to deal with this most troubling matter. I wish to discuss a phenomenon, one which used to relate only to America, that seems to have spread (or, perhaps I am wrong, and simply showing my young age) to our country.
My curiosity was sparked earlier when I asked a good friend why he was a Conservative. He replied that he believed that there needed to be order in our country (or ’society’, as any non-Thatcherite would have put it). An interesting and fine response, especially since this colleague was not simply a Conservative foot soldier, or someone who would simply vote Conservative, but also happened to be an incredibly intelligent man; and one who not only truly believed in the ideas of Conservatism and Thatcherism but understood them also.
He also later told me one thing that got me started along this thread of thought, that he believed himself to be a ‘classical liberal’. His version of the word ‘liberal’ certainly did not correspond to mine.
I have heard many other non-progressive thinkers describe themselves with this word - for example Friedrich Hayek (an Austrian aristocrat who once described altruism and ideology as irrelevant), Milton Friedman, and, of course, Mrs Thatcher herself (two people who both supported Augusto Pinochet’s dictatorship).
There seems to me to be something fundamentally wrong about the assertion that these people are indeed ‘classical liberals’, and not just because a lot of the people who assert that they are classical liberals are in fact incredibly authoritarian.
Neither can I simply put down the disparity between what these people describe as ‘truly liberal’ and what is now understood by the word ‘liberal’ by the ageing and changing of times, or what one historian noted as; ‘Today’s radical becoming tomorrow’s conservative.’
Nor can I put it down to these people simply being more right-wing in their liberal beliefs because, apart from a few ‘Anarcho-capitalists’ (Milton Friedman’s son for example), they often seem quite authoritarian when it comes to anything but economics.
Classical liberals largely seem to miss the point that a man’s liberality is not determined by how low they want taxes to be, nor one’s belief in the working’s of markets, but has far more to do with the workings of mankind. If liberals believe in a free market, it is not because they believe that it is the greatest way to prosperity, but rather that it is because mankind is capable of embracing and making its own economic decisions.
Anyone who has seen Ron Paul (a Libertarian Republican candidate for president) will know what I am talking about. He is a liberal, to be sure, but he is not so because of his beliefs in abolishing nearly every state department in the land for the private benefit of the people but because he honestly believes people are capable making those sorts of decisions themselves (although most of us would argue that democratically open and accountable state bodies are quite often better at fulfilling such roles without being in anyway illiberal as they correspond to the people’s political desires). Liberalism is not, and never has been, about economics on its own.
And there we have the crux of the matter. So-called ‘classical liberals’ have themselves failed to understand what liberalism truly means by believing that economics and ideology are inseparable, or at most one and the same. They see the glorious days of Ricardo, Malthus and Adam Smith as the days of true liberalism, when it meant what it said on the tin. Free trade was the conventional wisdom, and the evils of government intervention were negligible. To them this is liberalism, a free market, a small government and the public sorting public problems out themselves. Many within our party (and even more so within the conservative party) would agree. How wrong they all are.
Liberalism has never been about method, it is about fundamental beliefs in humanity that human beings are capable of making their own decisions in life, that they generally know what is good and bad for themselves and society - and are therefore capable of taking economic, political and social decisions themselves - combined with distrust for traditional and powerful elites (whether aristocratic, governmental or corporate).
‘Classical liberals’ place all their liberal faith in economic beliefs and none in the social or political ones, believing they can dilute humanity down to economic self serving machinations. Let me ask one question: if people are so capable of making their own economic decisions, then why are they so incapable of making political or social ones?
I know I would have disagreed with people like Ricardo and Malthus when it came to economics; although that may partly be due to the alien nature to them of the democracy and public services we have now. But under no circumstances would I question their being liberals. They fought against corporate and protectionist structures (the British Empire and East India Company), and believed strongly that through reform people should not have to be subject to the unaccountable powerful bodies that governed in those days of privilege equalling power. They, like me, had faith in humanity that all people (not just those with traditional power) could run their own lives, which is a fundamental assertion which is often missing from the rhetoric and actions of ‘classical liberals’.
In those days, however, the challenges were different. Poverty was not considered such a problem, and the methods for dealing with it had not yet been dreamed of. Instead, liberals of that time fought against the power of protectionist elites, cartels and the undeserving rewards those few gained from it, not because it would make certain people monetarily better off (which seems to be the sole aim of some classical liberals) but because it would lead to a free and just society. And, if liberalism is about anything, it is freedom and justice for all.
Classical liberalism should be erased from the political dictionary, or at least re-written as a word used by Tories to cover up their authoritarian nature. Liberalism is exactly what it says on the tin: liberty. And, although we may have different ways of achieving such a goal, the idea that liberals today are less liberal than their predecessors because they believe in using newer or different methods and ideas is, with all due respect, a complete and utter fallacy. Because, at its root, the heart and soul of liberalism remains - which so-called classical liberals often seem to be missing.
* John Dixon blogs at A Radical Writes.
Posted in Op-eds
28th July 2007 at 2:39 pm
Tories were against liberal free trade. So just because many contemporary classical liberals vote for the contemporary Tory party does not make them Tories.
Just as calling yourselves Liberal Democrats does not mean you are not really Social Democrats.
The labels are all mixed up nowadays.
28th July 2007 at 3:05 pm
This seems to me to confuse Liberalism and Libertarianism - Liberalism never was, and never will be, just about economics. For an interpretation of what we mean by Liberalism, you could do a lot worse than read Conrad’s “Intelligent Person’s Guide to Liberalism,” (borrow from Library, it’s v expensive,even from Abe books). He’s particularly good on why early Libs were in favour of Free Trade (to protect the poor!).
28th July 2007 at 3:22 pm
There are some good points in here. Hayek, Mises and other ‘Classical Liberal’ Libertarians are disturbingly disposed to distrust or at least minimise the value of democracy. Oddly enough though they don’t like Hobbes, they often lean to a Hobbesian ideal of a law governed free market, and the freedom of citizens from physical impediments to freedom, under a monarchical government with no democracy. Nevertheless, I think you’re a bit harsh on Friedman. Friedman’s account of his ’support for Pinochet’ is that he accepted invitations to advise the government of Chile at that time because he was willing to accept all such invitations from all governments. Friedman claimed that some leftists chose to turn that into accusations of active support for Pinochet. Pinochet was not such a pure free marketeer as legend suggests, in any case. Are you aware of any explicit pro-Pinochet declarations by Friedman?
28th July 2007 at 4:25 pm
John Dixon, first I must tell, that you are horribly illinformed, if you say that Milton Friedman supported Augusto Pinochet’s dictatorship. You have been listening rumours spread by socialists, which don’t have any ground in reality.
Milton Friedman was visiting his former students in Chile, when some of them, working in the central bank of Chile, had the idea to arrange a meeting between Friedman and Pinochet. That was, according to Friedman, their only contact ever. Friedman didn’t express his support to Pinochet or his regime, but gave some advice on currency policy. Later he visited also China and met local political leaders, but surprisingly you aren’t accusing him of supporting the Communist regime of China. He was an economist, not a politician, so you shouldn’t read too much from him meeting people who were somehow related to his work. You’ll find this information from the memoirs of Milton Friedman and his wife Rose D. Friedman, “Two Lucky People”.
It is also somewhat unfair to pass over Hayek as being an “aristocrat”. Yes, he had the “von” before his name, like so many Austrian families by the time he was born, but he wished himself that he would be called just “Friedrich Hayek” without “von”. And sespite his roots, he was never rich. Anyway, dismissing somebody only because of his or her descent is terribly illiberal.
About classical liberals - No, you are terribly wrong, again. Classical liberals aren’t interested only in economic beliefs and none in the social or political ones. Classical liberals are interested in both. And of course economics and ideology are inseparable. Do you really believe that economy doesn’t affect the every day life of each individual? Do you think, that a person can be free, if (s)he can’t do his or her own decisions conserning his or her own purse? Imagine, that you were taxed 100%. You couldn’t even decide what food you eat or whic kind of clothes you wear, if the government would have a 100% control of your use of money.
Again, you can take some liberal parties, parties who consider themselves as classical liberal, from the continental Europe. Take for instance the Radical Democratic Party of Switzerland. It support free markets, but also for instance legalisation of soft drugs and legal recognition for same-sex couples. Or take the Free Democratic Party of Germany, which again supports free markets, but also the legal recognition for same-sex couples and abolition of conscription. Or take the Dutch VVD, which again supports free markets, and has been instrumental in introducing same-sex marriages, euthanasia and abolishing the conscription.
But how could I convince you, as you clearly haven’t done anything to find out yourself, but prefer to believe what you want? I recommend that you would read some text from classical liberals. You could start from “Liberalism” by F. A. Hayek who you criticised, or Why I Am Not a Conservative from the same author. But probably you won’t bother, as you aren’t willing to change your mind.
If you really think that only the “anarcho-capitalists” aren’t authoritarian, I recommend for instance “Anarchy, State and Utopia” of Robert Nozick, “Persons, Rights and the Moral Community” of Loren E. Lomasky or “Principles for a Free Society” by Richard A. Epstein. None of these three authors is an anarcho-capitalist. On the other hand, if you take a closer look to some writings of such anarcho-capitalists as Murray Rothbard or Hans-Herman Hoppe, you may easily regard them as authoritarian.
And of course, just the fact that Mrs Thatcher said that she was following the teaching of Hayek doesn’t make her a classical liberal. She, as many conservatives, referred to Hayek’s “Road to Serfom”. This book is a criticism of totalitarianism in general and socialism in particular. Conservatives can easily agree with liberal on the criticism of socialism, but that doesn’t make conservatives liberals. But I have seldom, if ever, seen a conservative praising The Constitution of Liberty or Law, Legislation and Liberty in which Hayek presented his positive theory.
But maybe this is all only because you have misunderstood the term “classical liberal”, or your friend had misunderstood it. Classical liberalism refers to the original theory of liberalism, represented by such individuals as John Locke, Voltaire, Adam Smith, Immanuel Kant and John Stuart Mill. They all represented the kind of liberalism, which encompassed belief in both economic and personal freedom. People who share that view today can be also called “classical liberals”, in distinction from the later “new liberals”, who embrase only belief in personal freedom, and “neoliberals”, who embrase only belief in economic freedom. “New liberals” are also sometime called “social liberals” or “welfare liberals”, and “neoliberals” are sometimes called “economic liberals” or “conservative liberals”.
You asked: “if people are so capable of making their own economic decisions, then why are they so incapable of making political or social ones?” A real classical liberal, and certainly Friedrich Hayek or Milton Friedman, would answer: They are capable to do both. If somebody has told you something else, he’s wrong.
28th July 2007 at 4:39 pm
Many of the criticisms in this article wrest on false assumptions about what classical liberalism actually is.
To illustrate these problems just look at Milton Friedman. Far from being only concerned with economics or only liberal on matters, he devoted a considerable amount of time to campaigning for socially liberal causes like ending the draft or the legalisation of drugs.
Nor was he unconcerned with poverty. Much of criticism of state planning focused on its impact on the most vulnerable. He also devoted considerable thought to alternative ways to eliminate poverty. Tax credits and school vouchers were originally his ideas and reflected his belief that you could help the poor without disempowering them.
He was most certainly not a supporter of Pinochet. True, he gave advice and lectures to the Chilean government but he did the same for the Chinese government. Does that make Friedman a communist?
There are valid criticisms of classical liberalism but it being merely cover for authoritarian Tories is not one of them.
28th July 2007 at 4:39 pm
Serena H, you seem to be confusing libertarianism. Libertarianism never was, and never will be, just about economics. In United States the term was adopted to distinguish liberalsm who supported both economic and personal freedom, to distinguish them from people who called themselves “liberals”, but didn’t support economic freedom, but who might or might not support personal freedom. In the UK the term has been often misused, sometimes meaning people who support only economic freedom, and sometimes people, who support only personal freedom
Barry Stocker, you are mistaken, if you think that liberalism is the same thing as democracy. Sure, democracy is from a liberal point of view the best way to make common decisions, but the main issue for liberalism is not who makes the common decisions, but whether people can make their own decisions or not. As a simplified example, you could say that a society where people would vote on who will marry whom would certainly be democratic, but not very liberal.
28th July 2007 at 4:43 pm
Serena,
Um, I don’t think John is arguing that liberalism was ever just about economics. Rather, he is saying that many people who call themselves “classical liberals” are themselves labouring under that misapprehension.
28th July 2007 at 5:07 pm
I would like to make it clear that I do consider Friedrich Hayek and Milton Fridman Liberals (although very right wing ones). My problem with them is not with their ideas, although I do have qualms with them and their incapability to trust the state to anything but minor tasks, but rather with their use of the word classical liberal (which could truly be used in America I admit due to people like Roosevelt who used the word so as not to appear soialist). My point is that people often use the label ‘clasical liberal’ even though they are barely liberal at all and just support the ideas of a free market (for all the wrong reasons). I would also argue that there is far less difference between the liberals of the past and the liberals of today than classical liberals try to make out because they believed in the same fundamentals that liberals do today of human freedom. I see the label ‘clasical liberal’ as simply something created by modern free market economists to try to create a division beween liberals today and liberals past which in reality does not exist. I do not deny that many people who call themselves ‘classical liberals’ are i fact liberals but the term classical liberal is misleading and should be replaced by somethig more accrate like market liberals because the term separates ordinary liberals from old liberal ideas which newer liberals still agree with. The term is therefore devisive, misleading and should be abolished or replaced.
P.S. I thank you all on your advise of reading material! They sound perfect for getting me through recovery.
28th July 2007 at 5:10 pm
re. real classical liberal : that is the point of liberal plural democracy, to protect individual rights within a democratic state which I do think is a fundamental liberal idea (alhough a more modern one)
28th July 2007 at 5:36 pm
Like everyone else I think economics is only a small part of liberalism, although it is part.
Since the radical writing is keen on reading lists, I recommend J M Keynes essay “Am I a Liberal” which is in “Essays in Persuasion”. If you thought Conrad’s book was expensive, this one surely will be - but you might get it in the library. Keynes has some nice quotes on the other two parties, and he was an outstanding writer.
28th July 2007 at 5:46 pm
One ought to remember just who gave Hayek his most important platform…one William Beveridge as head of the LSE at the time.
Also, Milton Friedman explains why he is not a conservative here. Friedman is probably one of the most quoted political-economists in the cause of drugs laws liberalization.
As regards our own party’s history, for fifty years, right up until the 1930s, it was the Liberal party (and later the Labour party before socialism really ripped them assunder but never the Conservatives) that was the bastion of support for free trade (if you can get hold of a copy Henry George’s “Protection or Free Trade” it’s a good primer in the argument that free trade and not protectionism, private or public was the route out of welfare for the labouring classes). Indeed I only recently discovered that Lloyd-George left the National Government of the 1930s because of an argument with Tory members of that government who were pushing it towards their protectionist policies of old to get out of the depression.
I believe that a Liberal Democrat who does not believe they are the inheritors of Locke, Smith, Ricardo, the Mills and os on are not really Liberals. Either that or they do not understand their arguments about freedom and economics. The basic principal from what I can see of Locke is that of “self-ownership” - the idea that you are only truly free if you are able to fully enjoy all the fruits of your own labours.
The Liberals of the turn of the twentieth century knew all this. They were, in many ways, also the heirs of the early anarchists like Lysander Spooner nad Benjamin Tucker - they believed in the four great monopolies that the anarchist/libertarian movement said made men fundamentally unfree - land, money, patents and tariffs.
And actually we really need to get back to this understanding of Liberalism. A century of welfarism has surely shown us that that policy has not only not delivered in terms of poverty reduction and opportunity growth, but that it is costing ever huger amounts of money to perform it as a government function (and, inevitably as a result in my opinion will follow more and more restrictions on our freedoms in a newly globalized world so as government are still able to control their source of funds - taxes) and is producing government millionnaires by the week in the form of people who gain often badly worked out and always protectionist contracts with our money.
28th July 2007 at 6:51 pm
It would be a very foolish person indeed who only believed in economic freedom. Implicitly they would refuse to believe in those parts of our society that cannot be owned - and that either precludes things like borders, treaties with other nations and the rule of law, or (more likely in practice) places all of the above in the hands of an unelected despot.
I sincerely doubt that any of the economists that you list in your article were ever that headstrong!
No-one ever said economics was only about money. Certainly none of the above economists would have believed that. You simply cannot be a serious economist and deny the very real benefits of democracy and society.
On the other hand, it’s important to recognise that democracy has its limitations. To say otherwise would be to say that it’s OK for the state to decide how to spend 100% of our money as long as we have a vote on how it’s spent. I don’t believe that’s enough. When people spend money - as they do many times a day - they reveal a wealth of incredibly nuanced information about their wants and needs. When they vote, they can pick only one of an acutely limited number of options - in this country, they are extremely lucky if they have more than two real choices.
Taking that power away - the power to “put their money where their mouth is” - denies society vital information about what people actually want and need. No politician, however well intentioned (or liberally-minded) could ever hope to replicate that information. and so must attempt to second-guess those needs - with sometimes dire consequences. (Just look at any state that’s ever tried to plan the supply of food to its citizens and you’ll see what I mean).
I’m perfectly content for the state to leave people to planning their own lives for the most part (so long as no-one is enslaved by poverty, ignorance or conformity, that is).
Incidentally, I consider myself to be a supporter of free markets, democracy, and personal freedom - and I find “classical Liberal” an excellent description of that position.
28th July 2007 at 6:57 pm
Democratic government equals enslavement by conformity: discuss.
28th July 2007 at 7:00 pm
jockox3, I’m afraid your link to the Milton Friedman text doesn’t work.
28th July 2007 at 7:01 pm
13 - compare to John Stuart Mill’s tyranny of the masses.
28th July 2007 at 7:02 pm
Oh - I don’t know why - it’s not text, but a Google video of a very old TV program he was on:
http://video.google.com/videoplay?docid=6813529239937418232
or
http://tinyurl.com/2lc4or
28th July 2007 at 7:07 pm
OK, that explains it. I probably don’t have the correct plugins, because I can’t watch Youtube and Google videos with this computer. I’ll have to try when I’m at work. Thanks, anyway!
28th July 2007 at 7:10 pm
A transcript is available:
http://tinyurl.com/yh4dpc
28th July 2007 at 7:13 pm
What I find more interesting about that program though is that Friedman does not underestimate the problem of implementing true liberalism - that it appears to be counter-intuitive for humans not to have some “authority” in which to trust. That we have only really had a few decades of true liberalism before it was hijacked again by the masters of capitalism such as Rockerfeller and Morgan and the real beneficiaries of protectionism.
28th July 2007 at 7:22 pm
jockox3, Friedman wasn’t the first one to notice that. As John Cooke said, “We fought for the public good and would have enfranchised the people and secured the welfare of the whole groaning creation, if the nation had not more delighted in servitude than in freedom.” Or, Voltaire: “It is hard to free fools from the chains they revere.”
28th July 2007 at 8:22 pm
Strange the amount of free marketers we have on here at the moment. I would of course argue against the market as a means of making political and social decisions on mass as it can be tempered just as much, if not more so than democracy by powerful groups and the putting of individual gain above the public good although I believe it is the best way of allocating resources efficiently. The flaws in markets I find are often ignored by ‘classical liberals’ while the flaws in democracy are often exagerated. when it comes to life and death situations such as healthcare, fire control, etc the market is completely incapable of handling these functions andclassical liberals I find are often incapable of accepting this. The point I was trying to make in this article was that liberalism is not about method, economic and political systems and dogma but about a belief in human liberation and that liberals hae always believed ion this both in the 18th century and today and therefore the idea of classical liberalism is a myth because it perpetuates the idea that liberalism is about economic method rather than humanity. If anyone wants to see my view on markets and liberalism then Adam Curtis’ documentary ‘The Trap’ (can be found on google video) is a pretty good explanationof my discontent wih the dogmatic natue of no/classical liberals.
28th July 2007 at 9:49 pm
Perhaps there are so many free marketeers here because we have noticed the improving free market credentials of the Lib Dems. They have still a lot to do, though.
John Dixon: “The flaws in markets I find are often ignored by ‘classical liberals’ while the flaws in democracy are often exagerated.”
Funny you should say that, I have a feeling that you are ignoring the flaws in democracy and exagerating the flaws in markets. And you seem to artificially be separating the economic freedom from the personal freedom, like the economic decisions wouldn’t affect the individuals just as much. The reason why free markets are good is because they are the only economic system, where each individual can choose for him or herself. Markets are actually simply the sum of many indivual choices. In democracy each individual can, to be sure, participate to the decision making, but once the decision is made, everybody has to comply to it, and nobody can make his or her own, individual decisions. As Milton Friedman has said, “Underlying most arguments against the free market is a lack of belief in freedom itself.”
John Dixon: “when it comes to life and death situations such as healthcare, fire control, etc the market is completely incapable of handling these functions and classical liberals I find are often incapable of accepting this.”
Speaking about life and death situations, what about food industry and distribution, how can such vital functions be left to the markets? After all, people can live for a while without healthcare, but not without food. There are countries, where health care is produced (at least mostly) by the private sector, and the state only guarantees that everybody can afford it. For instance such countries as the Netherlands and Germany buy their citizens a health insurance, if they can’t afford one for themselves. The rest is left for the markets, which produce good quality services efficiently.
As for fire control, fire brigades are perhaps some of the few function of the state on which most classical liberals can agree about, though of course this service could also be bought from the private sector. If there is an oblicatory fire insurance, it might even be profitable to have private fire brigades, which would in the case of a fire then invoice the insurance company.
I can’t understand, why for some people claiming to be liberals it is so important that the state owns the means of production when it comes for instance to the health care or some other vital industry, though I can understand why socialists should think so. If the state owns the means of production in some sector, it limits the choice of individuals to choose where they buy what they need, and decreases the variety of products to those, which the state sees necessary, rightly or wrongly. What’s more, it prevents many private entrepreneurs entering the markets and competing with the quality and the price of their products, which again means less choice for the consumers. Don’t you think that holding on the publicly produced health care despite seeing the benefits of the private production is the real dogmatism?
28th July 2007 at 9:54 pm
Dear Real Classical Liberal, you are criticising me for things I didn’t say as well as playing down the suspicion of democracy in Mises and Hayek and many of their followers. Both, but particularly Mises, are frequently uncomfortable with the criticisms that are made of capitalism in democracies, and evidently consider the free exercise of such views more dangerous to liberty than even some of the famous absolutist monarchies of European history. I can provide quotations if needed. They are clearly happy with political systems which do not have universal suffrage and sovereign elected institutions if they give priority to private property. I did not say that Liberalism has to be democratic. I do however believe that liberalism that is not democratic, or is not at least paving the way for democracy, is going to betray the best insights of liberalism. What I said rather implied that Hobbes is the real ancestor of anti or a-democratic liberalism, which Mises and Hayek often came close to. Another example of an a-democratic liberal would be Humboldt who in some respects I admire very much, ands whose *Limits of State Government* I have read at least in part several times. Humboldt thinks his ideal of liberty and dialogue is best served by a monarchy concerned with defence of the community rather than politics, and with no democratic element. You are therefore incorrect in claiming that ‘Liberals’ always favour democracy as a method of discussion (unless you think democracy means discussion in the community outside political institutions which would be eccentric). Obviously you are entitled to defend your vision of liberalism, you might be a bit more careful in imputing claims to other people and in your account of possible interpretations of liberalism.
28th July 2007 at 10:35 pm
Barry Stocker, I apologise if I have misunderstood you, but that’s sure how I interpreted what you were saying, and no doubt also many others.
However, when criticising me of misinterpreting you, you might yourself want to be more careful in claiming what I have actually said. I wasn’t playing down the suspicion of democracy in Mises and Hayek. My point was, that that suspicion was justified, and I certainly wasn’t claiming that liberals (I consider myself one) always favour democracy as a method of discussion, on the contrary I was criticising such a thought already in the first sentence I addressed to you.
BTW, beside Humboldt, it might be worth mentioning the criticism to democracy made by John Stuart Mill, to which Ann refered in 15.
I was refering in an earlier posting to the essay “Liberalism” by Hayek. In the Systematic part of this essay, chapter 13, “Liberalism and democracy” Hayek writes:
“By the insistence on a law which is the same for all, and the consequent opposition to all legal privilege, liberalism came to be closely associated with the movement for democracy. In the struggle for constitutional government in the nineteenth century, the liberal and the democratic movements indeed were often indistinguishable. Yet in the course of time the consequence of the fact that the two doctrines were in the last resort concerned with different issues became more and more apparent. Liberalism is concerned with the functions of government and particularly with the limitation of all its powers.
Democracy is concerned with the question of who is to direct government. Liberalism requires that all power, and therefore also that of the majority, be limited. Democracy came to regard current majority opinion as the only criterion of the legitimacy of the powers of government. The difference between the two principles stands out most clearly if we consider their opposites: with democracy it is authoritarian government; with liberalism it is totalitarianism. Neither of the two systems necessarily excludes the opposite of the other: a democracy may well wield totalitarian powers, and it is at least conceivable that an authoritarian government might act on liberal principles.
Liberalism is thus incompatible with unlimited democracy, just as it is incompatible with all other forms of unlimited government. It presupposes the limitation of the powers even of the representatives of the majority by requiring a commitment to principles either explicitly laid down in a constitution or accepted by general opinion so as to effectively confine legislation.
Thus, though the consistent application of liberal principles leads to democracy, democracy will preserve liberalism only if, and so long as, the majority refrains from using its powers to confer on its supporters special advantages which cannot be similarly offered to all citizens. This might be achieved in a representative assembly whose powers were confined to passing laws in the sense of general rules of just conduct, on which agreement among a majority is likely to exist. But it is most unlikely in an assembly which habitually directs the specific measures of government. In such a representative assembly, which combines true legislative with governmental powers, and which is therefore in the exercise of the latter not limited by rules that it cannot alter, the majority is not likely to be based on true agreement on principles, but will probably consist of coalitions of various organized interests which will mutually concede to each other special advantages. Where, as is almost inevitable in a representative body with unlimited powers, decisions are arrived at by a bartering of special benefits to the different groups, and where the formation of a majority capable of governing depends on such bartering, it is indeed almost inconceivable that these powers will be used only in the true general interests.
But while for these reasons it seems almost certain that unlimited democracy will abandon liberal principles in favour of discriminatory measures benefiting the various groups supporting the majority, it is also doubtful whether in the long run democracy can preserve itself if it abandons liberal principles. If government assumes tasks which are too extensive and complex to be effectively guided by majority decisions, it seems inevitable that effective powers will devolve to a bureaucratic apparatus increasingly independent of democratic control. It is therefore not unlikely that the abandonment of liberalism by democracy will in the long run also lead to the disappearance of democracy. There can, in particular, be little doubt that the kind of directed economy towards which democracy seems to be tending requires for its effective conduct a government with authoritarian powers.
(Sorry to include such a lengthy quotation, but I thought it was necessary to better understand the suspicion of democracy expressed by Hayek.)
28th July 2007 at 10:53 pm
thanks real classical liberal, I do better understand Hayek’s view on things now. I disagree with Hayek it has to be said, and although I understand the limitation’s of democracy I believe liberty is jut as well obtained for people by them voting for what they want in society as well as them buying what they want in private. would you agree with me though that the unfettered power of private corporations is just as threaening to liberty as are unnaccountable beurocracies?
28th July 2007 at 10:53 pm
P.S: About capitalism vs. democracy, I indeed can see the contradiction. I remember than in seventies there were communist groupings demanding that the means of production should be submitted under democratic control, meaning nationalisation. Is this what you meant? If yes, I must say that I understand why Mises and Hayek prefered capitalism over democracy.
28th July 2007 at 11:03 pm
John Dixon: “Would you agree with me though that the unfettered power of private corporations is just as threaening to liberty as are unnaccountable beurocracies?”
That depends whether they use coercion against the individuals or not. If they have gained their position and retain it in free market, by for instance providing better services and products with lower prices than their competitors, and the consumers have voluntarily yielded this position for them for the same reasons, I can’t see there is a problem. However, at the moment the private corporation begins, by using force, to limit the liberty of the individual to make another choice, it becomes just as much a threat to the liberty than a criminal organisation.
29th July 2007 at 1:19 am
“Would you agree with me though that the unfettered power of private corporations is just as threaening to liberty as are unnaccountable beurocracies?”
Of course - any true liberal (of any kind) should oppose the monopoly power of big business - which not only threatens individual liberty, but does so precisely because it distorts markets.
When scarcity develops in a market system, it drives up prices and restricts individual choice. In any such system, there are always plenty of players trying to create and exploit positions of artificial scarcity, such as:
* Software giants trying to exploit a monopoly position and evade anti-trust laws
* Farming cartels lobbying for subsidies
* Manufacturing industries asking for tariffs to be placed on imported goods
* Oil-producing nations colluding to restrict international supply
* High-street computer game retailers fixing prices
Free-market aficionados do indeed oppose this sort of behaviour, despite the fact that they are what the companies that are providing these services would prefer to happen.
Free-marketeers should also fight strongly to protect consumers’ property rights, personal data, health and wellbeing against any malicious players in the market - because without trust, there is no market.
In short, free-market is profoundly not the same thing as pro-business.
29th July 2007 at 9:17 am
That I think is what separates true right wing liberals from what a lot of people call classical liberals.
29th July 2007 at 12:42 pm
John Dixon, I think that you are mistaken about whom most people call classical liberals. Your friend may call himself a classical liberal, but I think that most people who know what classical liberalism means, wouldn’t do so.
29th July 2007 at 1:37 pm
This is a rather good thread: well done to all. It is rare that disagre with Jock Coats but I don’t this any of us want to return to nineteenth century levels of governents spending (about, say, an eighth of today’s levels). The market economy rewards luck as well as work: if you are lucky to be born bright and in a well functioning family you may well be all set, but if you are not, well, the market economy without redistribution can be pretty brutal. That is not a vision that many LDs would want to subcribe too: we want everyone to have a chance, and we want support for those who for whom things go wrong. That is why our new poverty proposals (on which I worked) include more money for education for kids from underachieving backgrounds) and makes sure more money gets through to the poorest. But it does this without costing more, by chopping millions of middle class people out of tax credits.
29th July 2007 at 2:24 pm
I’d like to define more closely my point of view on the big corporations:
A monopoly position is not a problem as such, if it is achieved and retained without force, theft, fraud or breaking of contracts. The problem occures, if a company abuses its monopoly position in a non-acceptable way.
Likewise, all people (except for babies, the paralysed, etc.) have the ability to kill other people, but having that ability isn’t yet a crime. Only when one actually kills another person, he commits a crime.
29th July 2007 at 5:12 pm
Re Terry. My point is that the label classical liberal is misleadng because modern ‘new liberals’ ascribe just as much to fundamental classical liberal thinking as libertarians do. the only difference seems to be on governmnt intervention issues which has little o do in my view with the fundamentals of early lberal thought. However I have met many people who describe themselves as classical liberals who ar instead just rather right wing market conservatives, it seems to me like a misleading and often abused label.
29th July 2007 at 8:35 pm
Since 1938, Friedrich von Hayek and some other liberals distinquished themselves from classical liberals by calling themselves neoliberals. They were a “leftist” variant of classical liberals, the difference being that they wanted the state to exert some control on the abuse of monopoly power.
Milton Friedman is also a classical liberal. There is much classical liberalism in the Liberal Democrat party too, but that has been mixed with social democracy.
Milton Friedman has condemned Pinochet’s and China’s dictatorships and all other dictatorships too. Thatcher was not liberal but she was more liberal than the average Conservative, both economically and socially. E.g., she was among the first to support the decriminalization of homosexuality.
Not all classical liberals supported democracy, though it was often considered as the least evil, the form of government least dangerous to liberty.
Classical liberals generally supported Laissez-Faire. They include those mentioned above and also Anders Chydenius, Voltaire, Jeremy Bentham and Thomas Jefferson.
29th July 2007 at 10:02 pm
On that last point about Mrs Thatcher being a liberal; her record was mixed but on the who she as much an anti-liberal as she was anti-socialist.
On the positive side she supported a women’s right to abortion. On the negative side she introduced clause 28, she vilified gypsies and “immigrants”, supported apartheid, and firmly believed a women’s place was at home - even to the extent of having herself photographed doing the housework.
She believed in “Victorian Values” and absurdly believed that the permissive 1960s was caused by the decadence of socialism and that this could be rolled back by the free market. In fact precisley the opposite was the case - there are profits to be made from breaking taboos and the commercial sex industry is one of the most aggressive and ruthless fringes of capitalism.
From her perspective this was an unintended consequence, and we as Liberals should be careful that we are also not on some kind of receiving end if we decide to be as dogmatic as she was.
The Stern report identified global warming as a “market failure” and it is no surprise that free market ideologues such as Friedman, ASI, and IEA and other have had a blindspot as far as protecting the environment is concerned. You often hear then relying on unscientific arguments such as “Person X made an erroneous prediction 30 years ago that Y would happen, and look it didn’t, so therefore there is nothing to be concerned about”.
At a time we are determined to be the foremost green party on the political landscape - for very good reason - it would be absurd if our economic theories take as into the opposite direction.
30th July 2007 at 12:01 am
When I read things like this it just leaves me wondering whether the author wants the Liberal Democrats to be a broad liberal coalition of all our talents, with some chance of forming a government, or some narrow socialist libertarian sect questing for doctrinal purity on the sidelines.
The notion that the party can be divided neatly into factions, one of which that only cares about economics, the other only about social progess, is evidently codswallop.
The party largely holds a common consensus on what could be described as the social, personal & political aspects of liberalism. We believe in unleashing human potential, in individual freedom, rights, sustainability, international law, subsidiarity etc. the list of where we agree is long.
Where we seem to have most difficulty is on questions on how we get to what is often a shared belief in a liberal outcome. Sometimes it’s no more than the way we talk about it.
Does John for example sincerely believe ‘classical liberals’ don’t believe in redistribution?
It’s how you do it and why that often causes debate. I can’t for example see many ‘economic liberals’ having a problem with the Pupil’s Premium that targets additional educational resource to children from deprived backgrounds or removing tax breaks like taper relief.
I personally feel in today’s environment that the left and right of liberalism would be better defined as compassionate and aspirational in respect of emphasis than social and economic or classical.
For example evidently compassionate liberals are not 100% hostile to markets, more their failures and brutalism. Aspirational liberals don’t disagree with social justice or active government, more how they are defined and operate.
The crude divison of our party and guiding philosophy though into inaccurate charicatures of ultra-socialism and ultra-libertarianism is though wrong and unilluminating. In that regard this was a disappointing and ill-judged article.
30th July 2007 at 1:27 am
Interseting thread….but needing some clafification on aspects of Liberalism and what it s really about…go here for great info..
http://www.liberalvalues.org.nz/
http://freestudents.blogspot.com/
http://www.tvliberty.blogspot.com/
30th July 2007 at 7:36 am
The ‘what is liberal’ debate is an old chestnut.
I know what I am and I know why - I don’t need a label to define myself and my personal happiness does not depend on whatever label I choose to identify myself with, although it may determine it in the long run.
Intellectual theorising over systematised doctrines and purist philosophical positions is to miss the point of arguing a case - that of throwing specific perspectives into contrast to enable measurement and subsequent judgement on merit - extrapolating to the extremities of logical consequence is simply contrary to the nature of enlightenment!
History and society cannot be set apart from the works that analyse them, likewise the context of associations and influences built around them inform and prejudice the trends of current opinion due to their selectivity and emphasis.
Whatever any group or individual believes must still be reconciled with existence in a daily reality with infinite variety.
This is undeniable and inescapable - it is inevitable.
Truth is not restrictive or static; truth grows and changes - it doesn’t fit any preconcieved formula.
And this is the inherent problem, we may choose to call this intangible ‘liberty’, while others may call it something else, but it will be the party with the best discernable handle of an accurate description that will lead the upswell of popular support - so we must win this argument and own our own identity.
You may not be able to describe it, but you know it when it hits you - like when a bell chimes, when a goal is scored, when anything exactly hits the spot required.
Life+love=liberty
30th July 2007 at 9:45 am
As I’ve said earlier this isn’t so much an attack on right winged liberals (who I happen to get on quite well with in general) but an attack on the idea that liberalism can be described as classical. I’ve also been repeatedly quite annoyed by very conservative and authoritarian people(Mrs Thatcher for instance) who use the phrase ‘classical liberal’ to describe themselves when there is nothing liberal there to describe but think being a liberal equivolates to being a free marketer.
30th July 2007 at 10:43 am
A brand of liberalism has been described “classical” since the so-called “new liberalism” appeared in the end of the 19th century and the beginning of 20th century. And it was the “new liberals” who initially called themselves “new”. I don’t know whether it was them who begun to call the “old” liberals “classical”, or was it the “old” liberals themselves, but the term was created in order to distinguish them from a grouping calling itself “new”. Nowadays the “new” liberals usually use some other prefix, like “modern”, “social”, “welfare”, “agalitarian”, “left”, etc, or none, but “classical” has survived.
31st July 2007 at 10:22 am
There’s a lot of misunderstanding here.
There are two groups which can be called Classical Liberals - those who are liberals in all aspects and those who have adopted the terminology to simply promote economic liberalism.
The former are liberals in the various radical traditions before socialism - their heroes are likely to be Trenchard and Gordon or Cobden and Bright and Bradlaugh or John Lilburn or JS Mill or Jefferson and Jackson. There is no exact definition, but they favour little state intervention in any area of life.
The commenter who tries to claim that libertarianism is about economic liberalism alone is wrong too. Libertarianism is a more radical version of classical liberalism, libertarians are anti-prohibition, anti-aggression, pro-individual, anti-collectivist. They want to be left alone and want to leave others alone. They allow for less intervention by the state and for all actions to be voluntary if possible. They run the gamut from anarcho-capitalists and mutualists (anti-capitalist free marketeers) to what are basically classical liberals (who have abandoned liberalism due to its change in meaning)
Hayek, Friedman and von Mises are all liberals. They were concerned with freedom and liberty. They opposed tyranny, whether of the individual or of the majority.
Democracy poses problems, especially with the massive state which we have today - it easily becomes a tool for a powerful minority to impose their will upon others.
Democracy is a means not an end and as such it can be used for illiberal ends. That is why many Classical Liberals call for a small state - the power should lie with individuals over their own lives not with the state.
In a free market, all transactions are voluntary - that means that it is in fact far more open and democratic than voting once every four or five years for a member of a political elite. There may be problems with markets but these I feel are over stated, especially by those who believe in a strong state as the solution to problems.
I prefer making my own choices and I don’t claim to be able to make choices for others. That is what liberalism is to me. It means I don’t like the state, it forces me to do things I wouldn’t otherwise do and prevents me from doing things I’d like to.