Classical Liberalism

 

 

            Meaning of "liberalism."  The word "liberal" is said to have been coined in Spain early in the 19th century.  During the first half of that century, the word was most often used to refer to the philosophy of individualism.  Someone was a liberal who advocated capitalism, free trade, limited constitutional government, the Rule of Law, individualism, an essentially "bourgeois" (i.e., largely middle class, commercial) way of life, and a rationalist, secular outlook.

            In England after the middle of the 19th century, however, this sort of liberalism was overshadowed by something very different -- welfare liberalism.  This change was opposed by such thinkers as John Bright and Herbert Spencer, who (as the original form of liberal) saw that the new type represented the impact of the newly developing socialist ideas.  The welfare liberalism rapidly merged with the Fabian socialist movement when it arose.  Classical liberalism and socialism were strong antagonists.  For the most part, in England and on the continent of Europe the word "liberal" continued to mean a society centered on individualism.  It became, with many, a derogatory term as it was spoken of derisively by Hitler and the Marxists.

            In the United States, the incoming welfare liberalism preferred to call itself "progressivism" until the failure of the Progressive movement.  It began to call itself "liberal" primarily in the 1920s and 1930s.  The individualist-type liberals were displaced, and came to be known as "conservatives" (or, to those most versed in the history of these things, as "classical liberals," meaning the original form of liberal).  In this Study Guide, I will differentiate between "classical liberals" and "modern liberals."

            This explanation helps clarify the competing uses.  Unfortunately, it does not explain all usage.  There are authors who make none of these distinctions, but instead refer to all modern thought as "liberal," using the word to distinguish modern thought from that of the pre-modern regime of feudalism, faith and monarchy.  In this usage, even Rousseau and Marx are "liberals" -- and it becomes possible even to speak of "totalitarian liberalism."

            Historical development of classical liberalism.  Classical liberal thinking developed over many centuries.  The ancients contributed much, and even the feudal ideas of the Middle Ages contained important ingredients.  In his The Constitution of Liberty, F. A. Hayek traced a 2500-year development of the Rule of Law as a vital restraint on arbitrary government.

            The development of classical liberalism as a comprehensive social philosophy awaited, however, the rise of the commercial middle class at the end of the Middle Ages.  Classical and neo-classical economics, stating the theory of a market economy, has most thoroughly formulated classical liberal thinking.  Although there are many "non-economic" elements in its total position, classical liberalism has primarily been formulated as a "theory of capitalism."

            Classical liberalism has been on the defensive throughout the world during the 20th century.  In the United States, modern liberalism has largely been dominant instead.  Nevertheless, classical liberal attitudes, values and concepts continue to serve as an "underlay" for much of American life and to form the basis for the thinking of many Americans; and at least one important type of "conservative" holds strongly to a classical liberal viewpoint.  (It is worthwhile to understand that the "conservative movement" in the United States is an amalgam of several diverse elements: The most prominent part of American "conservatism" since 1960 has been Burkean conservative, which has taken a dim view of much of classical liberalism.  What is called "neo-conservatism" arises from thinkers who have left modern liberalism or socialism and have embraced part, but only part, of the classical liberal model.  Irving Kristol's book Two Cheers for Capitalism [you'll notice it isn't the usual three cheeers] is a good illustration.  The "libertarians" have carried the voluntaristic principle within classical liberalism to the point of being virtually an exclusive value, with comparatively little concern about cultural, ethical and institutional context.)    

 

            Central concepts.  The classical liberal considers the central problem in human life to have been the denial of individual liberty.  History is seen as primarily a struggle for liberty.

            Of the many definitions of "liberty," the classical liberal holds those to be spurious that do not concern themselves with the problem of coercion.  By coercion is meant one person's manipulation of another's circumstances in a way to cause him to act as the first desires, where the effect is detrimental from the point of view of the person manipulated.  The opposite of a coercive transaction is a voluntary one, where A offers B an enhancement of one alternative to make it more attractive to B than his other options.  This involves putting B in a better, not worse, overall position (although it is important to note that socialist "exploitation theories" say otherwise).  The uncoerced contract becomes for classical liberals the basic building block for human relationships, and a highly developed economy featuring specialization and the division of labor is to be founded on the interaction of vast numbers of contracts. 

            In striving for a society founded upon a voluntary nexus, the classical liberal seeks to obviate the degradation that comes from oppression, and to permit people to live as their own agents.  A free society is seen as a peaceable, productive plateau from which people can rise to their own self-determined heights of intellectual, aesthetic and moral attainment.  This spiritual dimension of classical liberalism finds its strongest expression in the writings of Ayn Rand in such books as Anthem, The Fountainhead and Atlas Shrugged.  (Rand was not an unmixed classical liberal, however, since she seems to have brought into it considerable influence from 19th century Russian nihilism and from Friedrich Nietzsche.)

            Perhaps one of classical liberalism's most important concepts is what I have called "the vitalist perspective."  To a very large extent, the classical liberal is persuaded that the world can in fact operate successfully if people are left to their own devices (assuming a social order that establishes the preconditions for this, although classical liberals differ among themselves about what preconditions are necessary).  He does not think that liberty is chaos.  He is willing to rely on human vitality and does not see people as inert matter.  His assertion of human capability is partly an empirical observation and partly a moral injunction, calling out to people to "so conduct yourselves that human life can be placed on a satisfactory footing."  The entire classical liberal "model" for society was built upon this assumption of human capability.  Adam Smith's conception of a workable market economy was based on a newly developed realization of the harmony of voluntary human energies.

            At the same time, the philosophy is oriented toward the real world, not utopianism.  The focus is primarily on production, motivation, work.  The classical liberal is ready, in keeping with his principles generally, to let the distribution of the product of that work be determined by the contractual arrangements people choose to make. 

            The classical liberal seeks to maximize individual voluntarism, but in a "do your own thing" age this is easily misunderstood.  Within the classical liberal conception of liberty (subject to the differences of opinion that I will comment on later about this), there is as much emphasis on responsibility as on the individual's unfettered right to do as he pleases.  The free society depends vitally on a moral order, and is seen to depend profoundly upon a net of subtle cultural patterns or mores, an ethical sensibility shared by the overwhelming majority of the population, and finally upon law and government.  The right of the individual to live his own life is the overriding purpose, but to accomplish this requires all of the cements that go to hold a civilization together.  Among other things, the monogamous family is important to classical liberalism because it serves as a supportive unit for the individual; because it is a source of moral values; and because, in contrast to a state nursery, it provides a multicentered source for the passing on of ideas and values to the next generation.

            "What ought to be the functions of the state?" is another central concern (and you can usually tell a classical liberal by his attentiveness to this, whereas most other philosophies give it little direct attention).  "Liberty under law" is part of virtually all classical liberal models.  The "Rule of Law," as Hayek recounts, was known to the Greeks as "isonomia."  It meant that the actions of the state should conform to criteria designed to make those actions mere impersonal guidelines that the acting person may use as data: a Henry VIII who must rule according to English law is a different sort of kind than a Henry VIII who can stretch the rules to behead whomever he pleases with the acquiescence of corrupt judges.

            Hayek wrote that the United States' main contribution to the Rule of Law has been its written Constitution.  To this is to be added certain main features of that Constitution: the separation of powers among the branches of government so that power is not centralized into one set of hands; and the decentralization of power through the "federal system" of divided sovereignty between the national government and the many states.

            Historically, classical liberals differed among themselves about how much they could trust the "common man" to preserve liberty.  On the continent of Europe, they supported "enlightened despotism" wherever kings and tsars would lead the way toward the Rule of Law, private property and a market economy.  To the contrary, in England and the United States classical liberals led the way toward universal suffrage.  No classical liberals, however, have been willing totally to subordinate the basic ingredients of individual liberty to the will of the majority.  They favor majority rule in the operation of a limited government, but oppose majority rule to the extent that it becomes the rationale for widespread statist action.  They have spoken of limiting majorities "by the chains of the Constitution."  (In the United States in the late 20th century, classical liberals give more support to majority rule than they have historically.  This is because they see the population as a whole as being much more "conservative" (in a classical liberal sense) than the political-media-and-academic elite that sets the tone for most public discourse.) 

 

            The challenges classical liberalism faces now.  In their role as "conservatives" in the United States and Europe opposing the "welfare state" and socialism, classical liberals have been pretty much united during the 20th century.  The need to oppose Communism prior to the collapse of the Soviet Union also kept them together.

            Divisions among them are now becoming apparent, however, as new challenges pose for them the question of what is most important within their philosophy.  This is bringing to the fore the fact that classical liberals differ among themselves about how much a society of personal freedom requires cultural and moral prerequisites.           

            First, those who stress their "libertarianism" tend virtually to agree with the 1960s' counterculture's vision of freedom as a "do your own thing" sort of lifestyle, while other classical liberals have, to the contrary, found reason to stress their cultural conservatism in the context of what they see as an erosion of the cultural and moral underpinnings of a free society.  The latter see personal responsibility as every bit as important as personal autonomy.

            Second, the nations of the world are rapidly moving into a global marketplace in which economic competition comes not just from within a given country but from peoples everywhere.  World population is growing beyond anything ever envisioned in human history, and is passing from four billion people a few years ago to a projected 10 and even 15 billion people within the span of lives now in existence.  Vast populations, largely impoverished, offer endless cheap labor, while at the same time those same populations offer, as well, the prospect of tens of millions of highly intelligent skilled workers.  In this context, many classical liberals follow the logic of their traditional free trade position -- which is that all peoples will be enriched by open competition in which those who can make something the cheapest should be the ones to do so, with all producers gravitating toward whatever products and services give them a "comparative advantage."

But here, too, there are other classical liberals who ask themselves whether this unlimited pursuit of voluntarism might not undermine the social, cultural and institutional prerequisites of a free society.  Might, say, the United States cease to be a producer of electronic products, cars, steel, airplanes, and the like?  Might the United States come to have millions of low-paid workers who must compete in an open international market with hundreds of millions of other low-paid workers?  These questions cause them to inquire into what constraints may be necessary to maintain each country's viability as a producing economy and as a cohesive society.  All classical liberals will have a predisposition toward free trade, since they are very much conscious of its benefits, but some feel it essential to mix this with other concerns.

            Third, though it is related to the preceding point, there is a growing division among classical liberals over the continuing existence of American and European national and cultural identity.  Both the United States and Europe have opened themselves to massive immigration, which offers to change the entire makeup of their societies within a few years; and there are international trends toward the submergence of national sovereignties into international organizations.  Many classical liberals welcome these developments as in keeping with their historic opposition to passports and to limits on the migration of individuals, and as consistent with  the 19th century classical liberal internationalist outlook that had little regard for nationalism.  It should be apparent from what has been said above that there are other classical liberals who disagree vehemently with this.  To them, the United States and Europe are the primary sources of the entire complex of values and institutions that form the basis for a free society.  They have no equal confidence in the rest of the world as a source of those things.  This leads them to postulate the vital necessity of preserving the identity and sovereignty of Euro-American civilization. 

            In part, these divisions came to a head during the primary election campaign in the 1996 presidential election.  They are bound to loom ever larger as time passes.

 

 

 

 

                                                            Bibliographical Notes

 

Most of the theoretical work done in formulating classical liberalism has overlapped with the work of the classical and neo-classical economists, which means that most of its theory has been in the realm of economics.  This makes it difficult to cite books that present an overview of classical liberalism as a total view of society.  The professor, who is a classical liberal, has long been aware of this deficiency, and he has sought to fill the void in his own writings, which remain almost entirely unknown.  The short monograph The Principles of Classical Liberalism is perhaps adequate to the purpose.  For a longer, more complete exposition, see the professor's Modern Social and Political Philosophies: Burkean Conservatism and Classical Liberalism (pages 97-452).  His first book, Emergent Man, stressed the spiritual dimensions, especially in its first third.  This book was strongly influenced by Ayn Rand, whose main books are mentioned in the preceding discussion.

 

Ludwig von Mises' Human Action and John Stuart Mill's Principles of Political Economy are vast treatises on economics, but can also be seen as principal statements of classical liberalism.  F. A. Hayek's The Constitution of Liberty deals with the history of legal and Constitutional underpinnings.  Milton Friedman's Capitalism and Freedom has the virtue of talking in terms of issues most important in the second half of the 20th century.  Herbert Spencer's The Man Versus the State is a powerful statement of a highly libertarian version.  Frederic Bastiat's short classic The Law is considered by many to be one of the great founding documents of classical liberalism.  Adam Smith's The Wealth of Nations (along with his The Theory of Moral Sentiments) is seen in the same way.  Lord Robbins' Politics and Economics is in keeping with the professor's own preference for a less deductive, more expansive statement of the prerequisites of a free society.  Wilhelm Roepke's The Humane Economy blends classical liberalism with a fair portion of Burkean conservative values.