In my wild youth, which was as long as it was fecund, I enjoyed a brief and mutually unsatisfactory fling with Marxism. One of the most fearsome methods used by Marxists to direct debate is to retreat into the world of “ism”’s, where, rather than engage in discussion of the relevant point, opponents are branded with the prevailing pejorative ‘ism’ of the day.
While its probably too late for Marxists to change, it’s rather disturbing when more mainstream political figures fall into the same habits. A recent example of this came when Labour MP Peter Hain, speaking on The Week in Westminster on Radio 4, described the coalition government as “neo-Liberal”. As a former Chair of the Young Liberals, Hain should understand the tenets of Liberalism a little better than that. And as a man who served in Labour Cabinets during the Iraq war, he should be familiar with Neo-Liberalism, as that war was cloaked in the ideology of ‘Liberal Interventionism”, a worldview which is at the core of Neo-Liberalism. In reality, there are no neo-Liberals in the Liberal Democrats, and only a handful among the Tories, while Labour, from Blair to the present day, practice neo-Liberalism with the fervour with which they once practiced Socialism.
Put simply, Neo-liberalism is the world view which argues that the biggest obstacle preventing man from living in a Liberal society is man himself. The differs from the traditional, classical Liberal view usually advocated by Liberal Democrats which argues that large institutions, and vested interests, ranging from the State, to big business and special interest groups are the barriers obstructing the path to a truly Liberal society. The social Liberal tradition enhances this by emphasising that both institutions and individuals have the capacity to cause harm to wider society, and so the state must step in to supply safeguards. Liberals of all stripes adhere generally to the view that society is enhanced when the means of production: Land, Labour, Capital and Enterprise, have the freedom to operate regardless of borders, race or religion.
That’s why it’s inaccurate to describe Tories as neo-Liberals. In their historic guise as defenders of protectionism, in their Thatcherite guise preaching an industrial policy which relies of ‘picking winners’ or in their contemporary Eurosceptism, and as opponents of mass immigration, the Conservative party have always had a worldview which is the very opposite of neo-Liberalism. The closest to a neo-Liberal in the Tory party is Kenneth Clarke, and he is perhaps more popular among Lib Dems than his own side.
The neo-Liberal economic ideology combines “Light touch regulation” with “post neo-classical endogenous growth theory”, both theories which the Tories would enjoy, but combined with a pro-Europe stance. These theories argue that man interfering in markets makes those markets less efficient and less Liberal. Classical economic Liberals posit the view that the government must act to protect the market, ensuring that none of the various vested interests become too powerful.
In social policy terms Neo-Liberals repeat their prognosis that the greatest obstacle to Liberal outcomes is Man. Labour try to deliver a Liberal social policy by enhancing the power of the state and its institutions. This manifests itself in the culture of centrally imposed targets, increased regulation and the ever expanding nanny state. Classical Liberals, in contrast, believe that truly socially liberal outcomes can only be achieved when the state sets only the broadest parameters, then allows individuals and relevant practitioners decide how best to proceed. This mantra was best defined by JS Mill, with his ‘harm principal”. Tories don’t traditionally want socially Liberal outcomes and generally use the state to prevent them occurring. So the next time Peter Hain or similar cast their gaze across the political spectrum to deploy the fashionable ‘ism’ of the day, perhaps they would be best served by first glancing in the mirror.
* David Thorpe is a member of the Liberal Democrats in Newham, and works for an economics publication.