Opinion: Why Lib Dems Need To Reinvent The State

By David Howarth | Thu 13th September 2007 - 11:25 am

The new book Reinventing the State is an attempt to update social liberalism for the present day. The origins of social liberalism lie in the party’s re-creation of itself in the early 20th century as a party not just of political reform but also of social reform, when radical Liberals added a commitment to social justice and democracy to the older Liberal commitments to expanding civil and political rights. The question is what that tradition means now.

Unlike socialists, liberals never allowed the desirability of greater equality to undermine their belief in individuality or their belief in the primacy of politics. Part of the process of updating social liberalism, however, is to remind ourselves that it does mean taking equality seriously – at a minimum level because of the political importance of not letting the super-rich take control of politics (either directly through donations to parties or through their control over the media) and, beyond the minimum, as a requirement of fairness. That means, for example, taxation policies that are designed not just to raise money for public goods but also to rein in economic inequality.

Another part of the process of updating social liberalism is to incorporate into our theoretical approach issues that the party has taken very seriously at the level of practical politics – for example climate change. What limits would we put on the power of the state to stop carbon emissions? Climate change is an existential threat (unlike terrorism), and that must influence our view of the fundamental social contract. As liberals, and not libertarians, we believe that property rights are tools to be designed, and redesigned, to maximise social welfare, not inviolable natural rights, and that is precisely what has to happen if we are to avoid catastrophe. But we would not permit the state to undermine democracy itself, no matter what the goal.

There are a number of other issues that the party has not taken seriously enough that require both theoretical incorporation and practical proposals – for example the mainly harmful transformation of everyday life that has taken place as a result of the replacement of personal relationships within families and communities by impersonal relationships via the media and the market. Democracy itself becomes highly unstable if it is seen solely as a different way of summing what individuals desire (which is what a market does). Democracy should be a process of deciding what we ought to desire, not just a mechanical device for deciding whose desires should be acted on. But in a fractured, atomised, media-dominated society, it is difficult to maintain any kind of debate about what we, as a body of citizens, ought to want.

We need ways of re-creating communities – preferably liberal communities. That means, for example, re-launching community politics as being about making new communities, not merely reflecting the views of existing communities (and even less a device for collecting votes). It also means thorough-going localism in politics, a politics in which people can take a meaningful part, and which really will make a difference to their lives.

Reinventing the State is not intended as a riposte to the Orange Book – indeed the list of authors of the two books overlaps to a considerable degree, and its working definition of social liberalism (as a form of liberalism committed to social justice and democracy, not just to individual rights) covers the vast majority of ‘economic liberals’ within the party, who are largely ‘economically liberal’ (i.e. want to use market mechanisms) about means, not ends. But ‘Reinventing the State’ does differ from the ‘Orange Book’ in taking into account the social and cultural consequences of handing over all collective decisions to market mechanisms. Markets in their proper place have considerable appeal for liberals, because they allow for variation and experiment and they disperse power, but their effects when uncontrolled, not only on equality but also on community and thus on the possibility of democracy, mean that they should not be allowed to displace politics. Localism also encourages variation and experimentation, and also disperses power, but, in contrast with the market, it has the power to create communities and to reinforce democracy.

David Howarth is MP for Cambridge, Lib Dem Shadow Solicitor General and a co-editor of ‘Reinventing the State’, which will be launched at our Brighton conference next week.

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8 Comments

Geoffrey Payne 13th Sep '07 - 1:10pm

I look forward to reading the book. When I joined the Liberal party in 1983, Liberals argued for a decentralised state. Mrs Thatcher, on the other hand, was persuing free market economics and simultaneously centralised government even more, even by abolishing democracy (eg the GLC) without a referendum.
What concerns me today is the rhetoric of some Liberal Democrats, particular those on the libertarian fringe who give the impression they want to abolish the state altogther.
In fact the countries of the world with the weakest states are some of the most illiberal; Columbia, Moldova, Albania, Iraq, Afghanistan, DRC all spring to mind.
Even the USA, not a country in anything like the same category, nonetheless showed the cost of a weak state by their inadequate response to the devestation of New Orleans, despite being the richest country in the world.
Stern identified global warming as the biggest market failure of all. Where economics fails, then politics has to intervene, just as Keynes and Beveridge proposed when tackling poverty in the 20th century.
It follows of course that if the market can fail, then we should always question whether market outcomes are the best in any given sector, and where not should not be afraid to look for alternatives.
After all, none of us want the British government to copy US health system or to legalise guns, so we do it already.
Edward 13th Sep '07 - 2:45pm

But where, Mr Howarth, do you draw the line? The problem is that you have to trust the state, over time, to better evaluate people’s real needs and interests than people themselves.
Joe Otten 13th Sep '07 - 3:46pm

Democracy should be a process of deciding what we ought to desire, not just a mechanical device for deciding whose desires…

A fascinating idea, but one I disagree with. I think this is the definition of ethics. Ethics is about what we ought to desire and value – which desires to encourage in others and which to discourage.

And politics shouldn’t be applied ethics. Society cannot make people good, but it can prevent them doing ill. Separating politics from the question of whose desires to act upon, preferring some greater unified noble virtue, seems necessarily to make it less democratic. Sure, people don’t always want what they should want, but this does not, contrary to what conservatives and socialists have always clamed, make any elitist institution any more virtuous than the people as a whole.
peter 13th Sep '07 - 4:28pm

“Democracy itself becomes highly unstable if it is seen solely as a different way of summing what individuals desire (which is what a market does). Democracy should be a process of deciding what we ought to desire, not just a mechanical device for deciding whose desires should be acted on. But in a fractured, atomised, media-dominated society, it is difficult to maintain any kind of debate about what we, as a body of citizens, ought to want.”

I largely agree with Joe, and I am not at all convinced that this passage represents a convincing critique of the world in which we live.

Look at the news over the last week. A lot of it has been about how to make people “better”: (less obese, less spendthrift). The fight against global warming is constantly presented (in the media) as an exercise in applied Kant: how should we behave differently as individuals to forsestall the destruction of the world?

Conceptualising market and state as in oppostion to each other hardly works in my view (the state defines property rights; the market decides how they are used). The relevant response to issues like global warming is not to abolish the market and replace it with the state (or individual altruism), but to introduce appropriate costs into the market (through taxes and or ETS etc).

Good to have a thoughtful article though…
Geoffrey Payne 14th Sep '07 - 7:44am

Peter, I think the state intervening by introducing taxes to mitigate market failures is something we can all agree on and is not contrary to anything written.
However it is one of a number of interventions. No one is taking about “abolishing the market”, not even the Swedes managed that. It is only where markets fail that action is needed from government.
Simon 14th Sep '07 - 10:52am

Liberals don’t value ‘equality’ per se, but should seek to pursue equality under the law, and equality of access to good opportunity. That might mean that we should use progressive taxation to fight poverty and exclusion (as many ‘Orange Bookers’ like Paul Marshall advocate in his pamphlet on educational inequalities for CentreForum). Largely it has been the Lib Dem ‘left’ that has argued for taxing the better-off to pay for those who are comfortable (tuition fees, old age care, prescriptions etc).

A more liberal and interesting take on the above is that markets work, but that the government has to factor in externalities like pollution. Robert Reich’s new book on Supercapitalism also argues that a liberal state should factor in factors relating to social capital. This does not mean resorting to some anti-Thatcherite market-bashing, but merely that the market must be damned and brooked more effectively rather than seek to increase the state’s homogenising role in our lives.
Tristan Mills 14th Sep '07 - 10:58am

Just to pick out the ‘Katrina failure’ the government failure was not due to lack of government, it was due to government failure. Bigger or stronger government would not have worked any better.

Those places which are asserted as weak states do have government, its just that the official government does not control the whole area they nominally control and rival governments consisting of militias and gangs control much of the place. So instead of the nominal state which we deal with, there are many, competing (and sometimes overlapping) states with no fixed boundaries.
What you’re really saying is that there’s a weak central and official state and many unofficial ones competing for power.

What those of us on ‘the libertarian fringe’ argue is that the state should be reduced since it far exceeds the minimum necessary. The debate for liberals in my mind is a debate as to what the minimum scope of the state is.
Tristan Mills 14th Sep '07 - 11:05am

I also disagree that markets cannot produce community.

Markets are the outcome of uncoerced human cooperation and interaction. That produces communities. Whether built around hobbies, a common locality or the use of a common resource.

I find that traditional communities have at times fallen apart with technology whilst others have been created.
The other source of destruction of communities is however the state. In the 20th Century, the state attempted to take on the functions of community (something the New Liberals never intended I believe). This can be seen today in the posters of say Waltham Forest council stating that the entire borough is one community – this is absurd. There are many communities within the borough. They overlap, but they are not based upon the lines of an artificial borough.