Differences and conflict within Liberalsim
There are tensions within liberalism
■ Human nature: all liberals believe that individuals are generally rational, intelligent, keen to pursue their own individual happiness and fulfillment, and respectful of other individuals’ wish to do the same. However, early classical liberals like Locke, and neo-liberals like Hayek, believe that individuals are naturally blessed with such qualities, while Mill and modern liberals like Rawls tend to think that such qualities are potential features of human nature, to be developed by enlightened liberal authorities. This is why modern liberals endorse Mill’s concept of individuality — one that refers to what individuals could become, once ‘enabled’ to fulfil their potential. So for example a libertarian might well feel that all human can be trusted to own guns, use drugs or educate their children. While a modern liberal would suggests that such individual freedoms need to be regulated at least.
■ Society: classical liberals believe that human society predates the state, while all liberals see society as a collection of diverse and potentially autonomous individuals, seeking self-determination, self-realisation and self-fulfilment. Modern liberals like Rawls, however, believe that industrialised and urban societies are those where individuals are less autonomous and therefore require state support to be free (‘positive liberty’). They would support a Welfare State and social services. Neo-liberals often see society as one where individuals have been damaged or unnecessarily restricted by ‘positive liberty’ and that the ‘dependency culture’ must now be corrected by a radical reduction of the state. Some neo-liberals might see the ideal situation as one where ‘there is no such thing’ as society, just a collection of atomised individuals pursuing self-interest.
■ The state: all liberals believe that the state should function according to prearranged rules and procedures, with power fragmented and authority subject to the consent of the governed. However, liberals vary on the extent of state activity. Classical liberals like Mill, in accordance with ‘negative’ liberty, believe state intervention should be minimal and individuals left unchecked (unless they hamper the freedom of others). Modern liberals like Friedan, in accordance with the concept of ‘positive liberty’, believe state intervention should be much more extensive so as to ‘enable’ individuals to reach their potential. Liberals have also varied over how democratic the state should be. Modern liberals are satisfied that representative democracy enhances constitutional government, whereas early classical liberals saw democracy as a threat to property rights.
■ The economy: following Locke’s assertion that property is a ‘natural right’, all liberals believe that the economy should be based on private property and private enterprise. However, while classical liberals and neo-liberals support Adam Smith’s thesis (that the state should adopt a laissez-faire attitude to the economy), modern liberals have more sympathy for the view of John Maynard Keynes (that capitalism requires regular state management to ensure full employment). Modern liberalism’s belief in ‘managed’ capitalism also explains its support for supranational organisations like the European Union, which many neo-liberals see as an obstacle to global free trade.
Classical liberalism . It is associated with the rise of industrial capitalism in the 18th and 19th centuries. Followers of classical liberalism prized freedom above other values, and believed that freedom could best be achieved by restricting the power of government. In the late 20th century, classical liberalism was reinvented in Britain and the USA as neoliberalism. It was associated with the New Right, an important influence on the British Conservative Party under the leadership of Margaret Thatcher (1975-90) and her successors.
Modern liberalism emerged in the early 20th century in reaction to the growth of free-market capitalism. It did not wish to abolish capitalism and replace private ownership with state control of the economy, but its adherents did believe in regulating the market in order to counter excessive deprivation and inequality. Modern liberals do not believe that people can be truly free if simply left alone' by the state.
Different views of freedom
Both classical and modern liberals value freedom, but they disagree over its nature. Classical liberals believe in negative freedom, a principle often linked to the idea of freedom of choice or privacy. Freedom can be expanded most clearly by restraining state power. Classical liberals also believe in egoistical individualism: that society is composed of rational individuals who can make decisions in their own interest.
The logic of negative freedom leads to the rolling back of the state, to encourage individuals to take more responsibility for themselves. Self-reliance is a key virtue for classical liberals.
Dependence on the state is damaging because it undermines the self-respect of the individual and saps the spirit of enterprise on which economic growth depends.
Current debates over the growth of a 'dependency culture' are linked to the ideas of classical liberalism. The idea of the dependency culture has come from the expansion of the UK welfare state since 1945, which has been associated with a loss of personal responsibility, the breakdown of the traditional family and the persistence of unemployment across generations. Neoliberals argue that social welfare should be targeted at those who really need it, and that others should be encouraged to lift themselves out of poverty through their own efforts.
Modern liberals believe that negative freedom is necessary but not sufficient for a good society. It can amount to little more than 'freedom to starve' for those facing disadvantages over which they have no control — for example, working in an occupation prone to periods of unemployment, or suffering an industrial accident. These people need assistance to live truly free and fulfilling lives.
This is why modern liberals support the idea of positive freedom. This defines freedom as self-mastery or self-realisation. Freedom can be expanded by qualified state intervention in the economy and society, to widen individual opportunity and liberate citizens from social evils such as poverty. Modern liberals favour developmental individualism — enabling individuals to enjoy personal growth and empowerment.
Different views of the state
Classical and modern liberals have some common ground on the nature of the state. Bothbelieve in the decentralisation of government and protection of civil liberties. In the 19th century, Gladstone tried to grant Home Rule or self-government to Ireland. In the 20th century this equated to the concept of devolution — the transfer of certain central government functions to elected bodies in the different parts of the UK. This influenced the New Labour governments of 1997-2010, which set up elected bodies for Scotland, Wales and Northern Ireland. Liberal reforms of the constitutional framework in the same period included the Human Rights Act and Freedom of Information Act, which guaranteed certain rights for citizens.Liberawisdom of the past and view the state as an organic entity whose component parts cannot be rearranged at will. Liberals subscribe to a mechanistic theory of the state — they see it as a machine created to serve the individual. Its parts are equal in worth and interchangeable.
However, there are different liberal views of the role that the state should play. Classical liberals believe that the state should merely lay down the conditions for orderly existence and leave other issues in the hands of private individuals and businesses. They support the idea of a minimal or 'night watchman' state, whose role is to maintain social order, enforce contracts and provide defence against external attack. The state should not interfere in economic and social life more than is strictly necessary, since this would risk undermining individual liberty. Its role is to maintain a stable framework for trade, uphold the value of the currency and generally create an environment within which laissez-faire capitalism can thrive.
In the 19th century, some classical liberals went further and developed what later became known as Social Darwinism. They borrowed from the naturalist Charles Darwin the concept of natural selection, which they applied to human society. They argued that, because individuals differ in their abilities, it is unavoidable that some will succeed and others will fail. Their most important figure was Herbert Spencer (1820-1903), author of the classic text The Man and the State (1884), who coined the phrase 'survival of the fittest'. He maintained that those who do well are those who adapt most successfully to their economic environment. The logic of this position is that government should not intervene to support people through the provision of social welfare.
By contrast, modern liberals believe in an enabling state — a larger role for government in helping individuals to be free and to achieve their potential. They arrived at this position through a growing awareness of the inequality of late 19th-century society, which they linked to low pay, unemployment, slum housing and poor working conditions. Known in the late-Victorian and Edwardian periods as 'New Liberals', they supported policies of welfare as the way to bring about equality of opportunity. They argued that, if individuals and groups are held back by their social circumstances, the state has a social responsibility to reduce or remove these disadvantages —known as welfare or social liberalism. It was expressed in the reforms of the Liberal governments
of H.H. Asquith before the First World War, including the first old-age pensions, National Insurance and labour exchanges, the forerunner of today's job centres.
The Beveridge Report
These ideas were taken further in the mid-20th century by Sir William Beveridge, a leading civil servant and academic. He was the author of the influential Beveridge Report (1942), the foundation of the post-war British welfare state. He argued that liberty should be available equally to all, and this was impossible if part of the population was held back by the 'five giants': poverty, lack of education, ill health, poor living conditions and unemployment. Beveridge's report had a major influence on the post-war Labour government. Comprehensive National Insurance, the National Health Service and improved housing and education were all responses to the challenges he outlined.
Modern liberalism also includes economic management on the lines proposed by the economist John Maynard Keynes (1883-1946). Keynes argued that the image of a self-regulating free market is a myth, and that government intervention is necessary to ensure that market economies deliver sustainable growth and keep unemployment low. In particular, governments should prevent a slump by managing the level of demand in the economy so that full employment is maintained. In his best-known book, The General Theory of Employment, Interest and Money, written during the Great Depression of the 1930s, Keynes argued for a programme of public expenditure to create jobs and stimulate the economy. Keynesianism was most influential in the decades immediately after the Second World War, when governments became more willing to act in order to correct the failings of the market.
Has modern liberalism abandoned the principles of classical liberalism?
■Classical liberalism defined liberty as individuals being left alone (negative freedom). Modern liberals think individuals are not free unless they are actively ‘enabled’ via interference from others (positive freedom).
■Classical liberalism championed a minimal state. Modern liberals champion an enlarged, enabling state. Classical liberalism was inclined to see taxation as ‘theft’ and sought to restrict it. Modern liberals often see increased taxation as the key method for implementing positive freedom.
■ Classical liberalism favoured laissez-faire capitalism from which the state is detached. Modern liberals favour Keynesian capitalism, where the state seeks to ‘manage’ market forces.
■ Classical liberalism had an unenthusiastic view of democracy, prioritising instead the interests of property owners. Modern liberalism has championed representative democracy.
■Both classical and modern liberalism have an optimistic view of human potential. Both classical and modern liberalism believe in rationalism and insist upon tolerance of minorities. Both classical and modern liberalism see individualism as the goal of politics and society — they differ merely about how to achieve it.
■Both classical and modern liberalism believe in capitalism and oppose state ownership of the economy.
■ Both classical and modern liberalism believe in a constitutional (‘limited’) state and ‘government by consent’.
Is modern liberalism a contradiction or a continuation of classical liberalism?
There is a clear difference between the classical liberal fear of the state and modern liberals' willingness to use its power to promote social justice. In the 19th century, liberals were sceptical of the benefits of state intervention. Gladstone described it as 'construction', a term that to him had negative connotations. He believed that it would take responsibility out of the hands of the individual.
Nevertheless, both classical and modern liberals are concerned in their different ways by expanding the freedom of the individual. Modern liberals see the state as helping individuals to help themselves and they regard state provision of welfare and education as a means to ensure equality of opportunity.
Both types of liberal are anxious to resist the idea of an over-powerful government. They share a commitment to holding the government to account, to decentralising power and to protecting therights of the citizen. Where they differ is in the extent to which they are prepared to use the state to achieve liberal objectives.