Liberalism is a political current embracing several historical and present-day ideologies that claim defense of individual liberty as the purpose of government. It typically favors the right to dissent from orthodox tenets or established authorities in political or religious matters. In this respect, it is sometimes held in contrast to conservatism. Since liberalism also focuses on the ability of individuals to structure a society, it is almost always opposed to totalitarianism, and often to collectivist ideologies, particularly communism.
The word “liberal” derives from the Latin “liber” (“free”) and liberals of all stripes tend to view themselves as friends of freedom, particularly freedom from the shackles of tradition. The origins of liberalism in the Enlightenment era contrasted this philosophy to feudalism and mercantilism. Later, as more radical philosophies articulated themselves in the course of the French Revolution and through the nineteenth century, liberalism equally defined itself in contrast to socialism and communism, although some adherents of liberalism sympathize with some of the aims and methods of social democracy.
Classification in a consistent manner is made difficult by the tendency of the dominant strain of liberalism in a region to refer to itself simply as “liberalism” and reject that identification for other minority positions. Since the word “liberalism” can not only refer to a variety of distinct political positions in different countries but can also range from being highly complimentary to being a term of abuse, the connotations of the word in different languages can be starkly different.
Usage of the word liberalism
The word liberalism has several different, but generally related, political meanings.
The Oxford English Dictionary (OED) indicates that the word liberal had long been in the English language with the meanings of “befitting free men, noble, generous” as in liberal arts; also with the meaning “free from restraint in speech or action”, as in liberal with the purse, or liberal tongue, usually as a term of reproach but, beginning 1776–88 imbued with a more favorable sense by Edward Gibbon and others to mean “free from prejudice, tolerant.”
The first English-language use to mean “tending in favor of freedom and democracy” according to the OED dates from about 1801 and comes from the French libéral, “originally applied in English by its opponents (often in Fr. form and with suggestions of foreign lawlessness)”. They give early English-language citation, “1801 Hel. M. WILLIAMS, Sk. Fr. Rep. I. xi. 113,” presumably Helen Maria Williams, Sketches of the State of Manners and Opinions in the French Republic: “The extinction of every vestige of freedom, and of every liberal idea with which they are associated.”
The editors of the Spanish constitution of Cadiz in 1812 may have been the first to use the word liberal in a political sense as a noun. They named themselves the Liberales, to state that they opposed the absolutist power of the Spanish monarchy.
In its original political meaning, the term “liberal” refers to a political philosophy, founded on the principles of the Enlightenment, that tries to circumscribe the limits of political power and to define and support individual rights. In the present, a variety of ideologies attempt to claim the mantle of 19th century liberalism, from libertarianism to American liberalism to social-liberalism.
Both European liberalism and American liberalism see their tradition as embracing the Enlightenment, the American War of Independence, the more moderate bourgeois elements of the French Revolution, and the European Revolutions of 1848, with philosophical roots going back to the Renaissance traditions of empiricism, humanism and realism of Sir Francis Bacon, Erasmus and Niccolò Machiavelli respectively.
The original Enlightenment thinkers, such as John Locke and Baron de Montesquieu, attempted to establish limits on existing political powers by asserting that there were natural rights and fundamental laws of governance that not even kings could overstep without becoming tyrants. This was combined with the idea that commercial freedom would best benefit the whole of the political order, an idea that would later be associated with the advocacy of capitalism, and which was drawn from the works of Adam Smith and David Ricardo. The next important piece of the triad of ideas of liberalism, was the idea of popular self-determination. Most liberals support a combination of these ideas, although many would ascribe more importance to one of them than to the other two.
Beginning in the late 19th century, liberalism started to become the governing ideology in various countries, e.g. in the United Kingdom. At the same time, liberalism became a major ideology in virtually all developed countries. As a result of being so widespread, the term “liberalism” began to evolve rapidly, and took on different meanings in different countries. In some countries, liberalism remained in its late 19th century form: limiting government involvement in private transactions of whatever kind, with government being devoted only to protecting against threats from abroad and enforcing civil order at home, along with maintaining a stable currency, based on a “sound money” policy.
However, with the coming of industrialization, a new wave of liberal thinkers began seeing government as a tool to encourage social progress and hence supported government action as a means to this end. This was a departure from the belief that government interventionism restricted liberty and thus inevitably retarded progress. The change led to a fundamental split in “liberalism” as a broad ideology.
These two diverging branches of liberalism are known in the United States and some other countries today as libertarianism and social liberalism, respectively. However, both of them usually claim the name of “liberalism” as their own, and do not recognize the other branch as being liberal at all.
Origins of Liberalism
Historically, liberalism claims to trace its roots back to the humanism of the Renaissance and the Glorious Revolution in Great Britain. However, movements generally labelled as truly “liberal” date from the Englightenment, particularly the Whig party in England, the philosophes in France and the movement towards self-government in colonial America. These movements opposed absolute monarchy, mercantilism, and various kinds of religious orthodoxy and clericalism. They were also the first to formulate the concepts of individual rights and the rule of law, as well as the importance of self-government through elected representatives.
The focus on “liberty” as essential right of people within the polity has been repeatedly asserted through history: in the middle ages Italian city states rose against the Papal States under the banner “liberty”, and a century and a half later Niccolò Machiavelli would make preservation of liberties a key trait of a republican form of government. The republics of Florence and Venice had elections, the rule of law, and pursuit of free enterprise through much of the 1400s until domination by outside powers in the 16th century.
The history of liberalism as a conscious ideology, that liberty was not an amendment to, but a fundamental basis of the rights within the polity and later the state, began to take more definite shape in response to absolutism, particularly in the United Kingdom. The definitive break was the conception that free individuals could form the basis of political stability, rather than having license to the degree that they did not threaten political stability. This is generally dated from the work of John Locke (1632-1704), whose Two Treatises on Government established two fundamental liberal ideas: economic liberty, meaning the right to have and use property, and intellectual liberty, including freedom of conscience, which he expounded in A Letter Concerning Toleration (1689). However, he would not extend his views on religious freedom to Catholics.
Locke developed further the earlier idea of natural rights, which he saw as “life, liberty and property”. His “Natural Rights theory” was the distant forerunner of the modern conception of human rights. However, to Locke, property was more important than the right to participate in government and public decision-making: he did not endorse democracy, because he feared that giving power to the people would erode the sanctity of private property. Nevertheless, the idea of natural rights played a key role in providing the ideological justification for the (at least moderately democratizing) American revolution and French revolution.
On the European continent, the doctrine of laws restraining even monarchs was expounded by Charles de Secondat, Baron de Montesquieu, whose The Spirit of the Laws argues that “Better is it to say, that the government most conformable to nature is that which best agrees with the humour and disposition of the people in whose favour it is established.” rather than the mere rule of force.
Following in his footsteps would be political economist Jean-Baptiste Say and Destutt de Tracy who would be the most ardent exponents of the “harmonies” of the market, and in all probability it was they who coined the term laissez-faire.
In the later half of the 19th century two schools of thought particularly important for later liberal thinking emerged. One can be traced to the “Scottish Enlighenment”, including the thinkers David Hume, Adam Smith, Immanuel Kant and Anders Chydenius.
Hume’s contributions were many and varied, but most importantly his assertion that fundamental rules of human behavior would overwhelm attempts to restrict or regulate them. One example of this is in his disparging of the mercantile state’s project of accumulating more gold and silver as leading to more wealth. He argued instead that prices were related to the quantity of money, and therefore this would only generate inflation.
The Scotsman Adam Smith (1723–1790) expounded the theory that individuals could structure both moral and economic life without direction for the purposes of the state, and indeed, that the nations which would be the strongest would be those that left individuals free to follow their own initiative. He advocated the end of feudal and mercantile regulations, state granted monopolies and patents, and is seen as the promulgator of a principal of “laissez-faire” or “let [it] act” — minimal government intervention in the functioning of the free market. Adam Smith developed a theory of motivation that tried to reconcile human self-interestedness with unregulated social order (mainly done in The Theory of Moral Sentiments (1759)). His most famous work, The Wealth of Nations (1776), tried to explain how an unregulated market would naturally regulate itself via aggregated individual decisions.
Kant, while a German, was strongly influenced by Hume’s empiricism and rationalism. His most important contributions to liberal thinking are in the realm of ethics, particularly his assertion of the categorical imperative. Kant argued that received systems of reason and morals were subordinate to basic natural and moral law, and that, therefore, attempts to stifle this basic law would meet with failure.
The second strand of thinking which would become increasingly important was founded by Jean-Jacques Rousseau. His assertion that man is born free, but that education was sufficient to restrain him within society rocked the monarchical society of his age. His assertion of an organic will of a nation argued for self-determination of peoples, again in contravention to the established political practice of dynastic politics of the time, would be a key element in the declaration of the National Assembly in the French Revolution, and in the thinking of Americans such as Benjamin Franklin and Thomas Jefferson.
The Liberal Revolutions
These thinkers, however, worked within the political framework of monarchies (albeit sometimes constitutional ones). The idea that human beings could structure their own affairs through the working of understood rules remained theoretical until the American and French Revolutions. Thus, while the Glorious Revolution is often used as a precedent, the two late 18th century revolutions became the examples which later revolutionary liberals followed.
Franklin, Jefferson and John Adams would be instrumental in persuading their fellow Americans to revolt in the name of The Laws of Nature and of Nature’s God, echoing Montesquieu, and to secure life, liberty and the pursuit of happiness, echoing Locke. The “American Experiment” would be in favor of democratic government, individual liberty, and, as importantly, economic development which was best achieved through these two mechanisms.
However, when it came time to draft a Federal Constitution, it was two younger men, James Madison and Alexander Hamilton, who would find specific means to put the idea of competing interests within the law as being necessary and sufficient for liberty into specific structures. They furthered the influence of the new ideology on the American system of government, by advocating a system of checks and balances, federal states’ rights and a bicameral legislature.
At the core of this wave of liberalism was most often the ideal of a night-watchman state, a state limited to the functions of upholding the law, preventing abuses of civil authority, expanding markets and defending the country. Even standing armies were held in suspicion, and the belief was that the militia would be enough for defense, along with a navy maintained by the government for the purpose of trade.
The French Revolution, coming out of the direct overthrow of a monarchy, along with an aristocratic social order, was more vehement in its belief in egalitarianism, and the necessity of removing the old order. The key moment in the French Revolution was the rejection of a constitutional monarchy and the declaration by the representatives of the Third Estate that they were the “National Assembly” and the representatives of the interests of the French people.
The French Revolution proved unable to navigate the transition from revolt to stability as the American Revolution had. Instead of an ultimately republican constitution, Napoleon Bonaparte would rise from Director, to Consul, to Emperor. On his death bed he confessed “They wanted another Washington”, meaning a man who could militarily establish a new state, without desiring a dynasty.
Nevertheless, the French Revolution would go farther than the American Revolution in establishing universal male suffrage, national citizenship and a far reaching “Declaration of the Rights of Man”, paralleling the American Bill of Rights.
The Ideology of Revolutionary liberalism
With the coming of romanticism, liberal notions moved from being proposals for reform of existing governments, to demands for changes. The American Revolution and the French Revolution would add “democracy” to the list of values which liberal thought promoted, and based their political sovereignty on “the rights of man”. This idea, that the people were sovereign, and capable of making all necessary laws and enforcing them, went beyond the conceptions of the Enlightenment. Instead of merely asserting the rights of individuals within the state, the people were the state, and all of the state’s powers were derived from “the just consent of the governed”.
The contractual nature of liberal thought to this point must be stressed. One of the basic ideas of the first wave of thinkers in the liberal tradition was that individuals made agreements and owned property. This may not seem a radical notion now, but at the time, most property laws defined property as belonging to a family or to a particular figure within it, such as the “head of the family”. Obligations were based on feudal ties of loyalty and personal fealty, rather than an exchange of particular goods. Gradually, the liberal tradition began to see voluntary consent and voluntary agreement as being the basis for legitimate government and law. This view was further advanced by Rousseau with his notion of a social contract.
Between 1774 and 1848, there were several waves of revolutions, each revolution demanding greater and greater primacy for individual rights. The word “liberalism” itself was invented in this period. The revolutions placed increasing value on the idea that national unity was an important part of political unity, and that a people could not be properly governed by those who were not present. This was a particularly important concept in the revolutions which ended Spanish control over much of her colonial empire in the Americas, and in the assertion of nationalism in Europe, which separated regions from monarchies that had traditionally controlled them. As part of this revolutionary program, the importance of education, a value repeatedly stressed from Erasmus onward, became more and more central to the idea of liberty.
Dignity, equality, liberty and property
The early 19th century also saw the primary ideological conflict within liberalism brought forward. The two key concepts of liberalism are the dignity and equality of the individual and the right to individual liberty, particularly to own and control private property. These two principles found themselves in conflict, when it became obvious that the property rights of some individuals could not be reconciled with the dignity of others. The extreme case of this was chattel slavery, where one person was viewed as another person’s property. Generally, in this conflict, the weight of liberal thought tilted towards the importance of human dignity, viewed increasingly by liberals as more fundamental than the claims of property. However, balancing these two fundamental values still explains a series of conflicts within liberal thought.
The late 19th century saw the expansion of voting rights, education and economic progress in the form of industrialism. It also saw the expansion of trade, and therefore opportunity, as well as an explosive growth in the spread of culture and literacy. At the same time, it produced vast inequalities of wealth, and vast human misery in the form of famines, child labor, polluted urban centers, and deep poverty for the majority of the population. The conflict between property and dignity came forward. One strain of liberal thought demanded laws against child labor, and requiring minimum standards of work and wages, while the laissez-faire strain argued that such laws were an unjust imposition on property and a hindrance to economic development.
Another important principle of liberalism was the rationality of government and its institutions. The late 19th century saw the rise of standardization and internationalization of such things as time keeping and weights and measures, as well as money systems and international commercial transactions. Liberalism’s insistence that the individual, real or corporate, was the important unit of law, made it the only framework within which the increasingly interdependent trade could be governed. Feudal notions of property, in many nations still in force, were gradually stripped away. For example, serfdom was still practiced in Russia well into the 19th century, and commerce restrictions dating from the middle ages existed in German states right up to unification under Prussia in 1871.
John Stuart Mill (J.S. Mill, 1806-1873) was influential in developing modern concepts of liberalism. He opposed collectivist tendencies while still placing emphasis on quality of life for the individual. He also had sympathy for female suffrage and (later in life) for labor co-operatives. His support for utilitarianism grounded liberal ideas in the instrumental and pragmatic, allowing the unification of subjective ideas of liberty gained from the French thinkers in the tradition of Jean-Jacques Rousseau and the more rights-based philosophies of John Locke and the British tradition.
In the late 19th century and early 20th century, there was a growing body of opinion which asserted the idea that, in order to be free, individuals needed to have access to all of the requirements of fulfillment: in that view, individual liberty requires that society take responsibility for providing a basic level of opportunity, protection and education.
With the beginning of the 20th century, the conflict between dignity and property became even more acute. Industrialization produced vast fortunes, and a great increase in the potential standard of living. It also produced vast misery and poverty, as well as powerful engines of war. While in the late 19th century industrial nations had been able to seize land and materials from less technologically advanced and politically organized nations (during the age of imperialism), by the early 20th century the globe had been already carved up, and, in order to expand, industrial nations would have to turn on each other. World War I soon began.
In 1911, L.T. Hobhouse published Liberalism , which, while it summarized the liberalism of the 19th century, also included qualified acceptance of both government intervention in the economy, and the collective right to equality in dealings, what he called “just consent”, which included trade unions.
Liberalism against totalitarianism
In the mid-20th century, a new philosophy (or rather, a collection of philosophies) arose: totalitarianism. Totalitarian ideas were centered on the principle that absolute centralized control over all aspects of society was necessary in order to achieve prosperity, stability, and many other goals. Most totalitarians also wished to discredit and destroy liberalism in one way or another. In reply, liberalism spent most of the 20th century defining itself as an opposition to various strains of totalitarianism.
The Great Depression of the 1930s shook public faith in laissez-faire capitalism and “the profit motive”, as well as the ability of unregulated markets to produce prosperity. Liberalism was to make a third dramatic transformation: the creation of a more elaborate state apparatus was argued for as the bulwark of individual liberty and the continuation of capitalism without resorting to dictatorship. Key thinkers in this transition were John Dewey, John Maynard Keynes and in the political realm Winston Churchill and Franklin Delano Roosevelt. But unlike previous transformations, this one did not subsume all other strains of liberalism. Many “liberals” held to the 19th century version of liberalism, and believed that the Depression and Second World War were individual events, which, once passed, did not justify continuing intervention by the state. An example of this line of thinking is Hayek whose work The Road to Serfdom remains influential.
In Italy and Germany, nationalist governments arose that linked corporate capitalism to the state, rather than to individual liberty, and promoted the idea that conquest and national superiority would give these nations a rightful “place in the sun”. The totalitarian states argued that democracy was weak and incapable of decisive action, and that only a strong leader could impose the kind of discipline that was necessary.
The rise of totalitarianism became a lens for liberal thought. The majority of liberals began analyzing their own beliefs and principles to find out where they had gone wrong. Eventually, they came to the conclusion that totalitarianism rose because people in a degraded condition turn towards dictatorships for solutions. From this, it was argued that the state had a duty to protect the economic well being of its citizens. As Isaiah Berlin put it, “Freedom for the wolves means death for the sheep.” They also argued that rationality of governance required the government acting as a balancing force in economics, as shown by the recently developed theory of Keynesianism. It became necessary to “save capitalism from itself”, and for free nations to accept the burdens of defending democracy and liberty with force if need be.
People like Lujo Brentano, Leonard Trelawny Hobhouse, Thomas Hill Green, John Maynard Keynes, Bertil Ohlin and John Dewey theorized why and how a government could intervene in the economy without the country becoming a socialist planned economy. The above mentioned liberals took the name of new liberals, to underline how they endorsed the evolving tradition of personal liberty and dignity, while rejecting the radical capitalist element from the classical liberal school of economic thought, as well as the revolutionary elements from the socialist school. The term “new liberal” has passed out of general use, and is now called “liberalism” in the United States.
The origins of the this current can be found in the Liberal Party in Britain, particularly since Lloyd George’s People’s Budget. This is the “liberal tradition” that John Maynard Keynes claimed to uphold in the 1930s (although he was also influenced by Fabianism). The Oxford Liberal Manifesto of 1947 of the world organization of liberal parties, the Liberal International, also represents this form of liberalism. The influence of Keynesianism on Franklin D. Roosevelt’s New Deal has led liberalism to be identified with the welfare state in the United States and in Canada.
Liberalism after World War II
In much of the West, expressly liberal parties were caught between “conservative” parties on one hand, and “labor” or social democratic parties on the other hand. For example, the UK Liberal Party became a minor party. The same process occurred in a number of other countries, as the social democratic parties took the leading role in the Left, while pro-business conservative parties took the leading role in the Right.
Nevertheless, the post-war period represented the heyday of “new liberalism”. Linking modernism and progressivism to the notion that a populace in possession of rights and sufficient economic and educational means would be the best defense against totalitarian threats, the liberalism of this period took the stance that by enlightened use of government power, individual liberties could be maximized, and self-actualization could be reached by the broad use of technology. Liberal writers in this period include economist John Kenneth Galbraith, philosopher John Rawls and sociologist Ralf Dahrendorf. Many liberals in Europe, as well as in North America, participated in the building of the welfare state.
At the same time, a significant dissenting strain of liberalism developed – namely the trend which viewed any government involvement in the economy as a betrayal of liberal principles. Calling themselves “classical liberals” and/or “libertarians”, this movement was centered around such schools of thought as Austrian Economics.
The debate between personal liberty and social optimality occupies much of the theory of Liberalism since the Second World War, particularly centering around the question of to what degree social choice and the market mechanism interact to produce the most “just” distribution of goods and utility. One of the central parts of this argument concerns Kenneth Arrow’s General Possibility Theorem, which states that there is no consistent social choice function which satisifies unbounded decision making, independence of choices, Pareto optimality and non-dictatorship: in short, it is not possible to have both unlimited liberty, and the maximum amount of utility with unlimited range of choices.
Another important argument within liberalism is the importance of rationality in decision making – whether the liberal state is best based on rigorous procedural rights or whether it should be routed in substantial equality.
The crucial question of liberalism is the question of whether people have positive rights as members of communities – in other words, positive expectations in addition to being protected from wrongs done by others. For most modern liberals, especially in the United States (but also in Europe), the answer is “yes”: individuals do have positive rights based on being members of a national, political or local unit, and have a just expectation to benefits accruing to them, and protections being afforded to them. Other, more classical liberals, would answer “no”: individuals have no such rights as members of communities, for such rights conflict with the more fundamental “negative” rights of other members of said communities.
If individuals have positive rights as members of a community, they therefore have a right to expect that their community will regulate the economy, since rising and falling economic circumstances are not part of what an individual can control. If individuals have a right to participate in a public, then they have a right to expect education and social protections against discrimination as members of that public. And so on. Many liberals have widely different opinions about the precise number and nature of these rights that should be recognized.
The liberal pendulum
After the 1970s, the pendulum had swung away from government action, and towards a return to the use of the free market and laissez-faire principles. In essence, many of the old pre-World War I ideas were making a comeback.
In part this was a reaction to the triumphalism of the dominant forms of liberalism of the time, but as well it was rooted in a foundation of liberal philosophy, particularly suspicion of the state, whether as an economic or philosophical actor. Increasingly cogent criticisms of the governing liberal philosophy began to emerge with Milton Friedman in the United States, and with members of the Austrian School in Europe. Their argument was that regulation and government involvement in the economy was a slippery slope, that any would lead to more, and that more was difficult to remove. In this they had no small agreement from individuals such as John Maynard Keynes, who wrote to Hayek, saying he was “deeply moved” by the argument that temporary government programs could become permanent tyranny.
At present, liberalism and its many descendants are the most prominent philosophical schools in the west and in the increasingly large sphere of economies and societies linked to them. The ideas of individual liberties, personal dignity, private property, universal human rights, transparency of government, limitations on state power, popular sovereignty, national self-determination, privacy, enlightened and rational policy, the rule of law, fundamental equality – all radical notions some 250 years ago, and not all completely codified into law until late in the 20th century, are almost universally admitted as the goals of policy in most nations, even if there is a wide gap between statements and reality.
A caveat is in order: as with any other political philosophy, an abstract explanation of liberalism refers to an ideal. In practice, politicians make pragmatic compromises (see centrism), have personal interests, and may pander to voters, so that the ideal is never a perfect description of any one individual’s politics. Further, as with any other political philosophy, liberalism in any of its forms is defined somewhat differently by its proponents and its opponents. Those who adhere precisely to a well-defined set of principles are often those who are far removed from contention for power. The policies of liberal parties are always more or less based on the right to self determination of the individual, and the reciprocal responsibility of the state to protect and promote the individual citizens which make it up.
In general, liberals favor constitutional government, representative democracy and the rule of law. Liberals at various times have embraced both constitutional monarchy and republican government. They are generally opposed to any but the milder forms of nationalism, and usually stand in contrast to conservatives by their broader tolerance and in more readily embracing multiculturalism. Furthermore, they generally favor human rights and civil liberties, especially freedom of speech and freedom of the press (while holding various positions on whether people have an inherent right to the means of economic subsistence). However, the liberal commitment to unrestricted individual liberty is not necessarily absolute: as Oliver Wendell Holmes, Jr said, “The most stringent protection of free speech would not protect a man in falsely shouting fire in a theatre…,” and liberal parties support restrictions on incitement to violence.
Liberals also typically believe in a free market and free trade, but they differ in the degree of limited government intervention in the economy which they advocate. In general, government responsibility for health, education and alleviating poverty fits into the policies of most liberal parties. But all of them, even American liberals, tend to believe in a far smaller role for the state than would be supported by most social democrats, let alone socialists or communists.
Liberals generally believe in a neutral government, in the sense that it is not for the state to determine how individuals can pursue happiness. This self-determination gives way to an open mind in ethical questions. Most liberal parties support the ‘pro choice’ movement and advocate the emancipation of women and homosexuals. Equality before the law is crucial in liberal policies, and racism is incompatible with liberalism. All liberal parties are secular, but they differ on the issue of anti-clericalism. Liberal parties in Latin countries tend to be very anti-clerical.
Liberals agree on the idea that society should have very limited interests in the private behavior of its citizens in the areas of private sexual relations, free speech, personal conscience or religious beliefs, as well as political association. Assurance of personal liberties and freedom, particularly in the case of individual expression, is highly important to liberalism. As John Rawls put it, “The state has no right to determine a particular conception of the good life“. The left-wing of liberalism, especially in the United States, considers it fundamental that society has a responsibility to guarantee equal opportunity for each of its citizens. In general, liberals do not believe that the government should directly control any industrial production through state owned enterprises, which places them in opposition to social democrats.
Since liberalism is broad, and generally pragmatic in its orientation, there is no hard and fast list of policy prescriptions which can be universally assumed to be “liberal”. In some circumstances there will be tax increases, in others tax decreases. In some cases there will be the creation of a quasi-public entity to perform a function, in other cases privatization or the creation of a government program. Sometimes liberalism emphasizes financial aid to poorer citizens (e.g. as unemployment benefits or negative income tax or basic income, guaranteed minimum income or citizen’s dividend). Most liberal parties argue that the government should provide some form of health services and basic education. Also, most liberals believe that social security benefits should be financed from taxes, whereas perks must be purchased by private insurances. In order to provide fuller choice for individuals, they may sometimes support vouchers in utilization of government-paid benefits, such as education or senior care.
Liberalism in different countries
The word liberalism and its cognates have different (albeit related) meanings in various countries. In most countries, capital-“L” Liberal is used to label the members or sympathizers of a Liberal Party, while small-“l” liberal is used to label the adherents of liberalism as an ideology or simply a political stance.
- On the European continent, liberal generally refers to a broad tradition of individual liberties as well as democratically accountable government. This usually encompasses the belief that government should act to alleviate poverty and other social problems, but not through radical changes to the structure of society. European liberals are divided on the degree of government intervention in economy, but generally they favor limited intervention. In France and in Southern Europe, the word “liberal” can refer either to the traditional liberal anti-clericalism or to economic liberalism. However, in recent years in France, the word is being increasingly used by proponents of laissez-faire capitalism and minarchists; ultra-libéral is a pejorative term aimed by a large section of the French left-wing against those whom they regard as having extreme capitalist views. The progressive wing of European liberalism, e.g. in France, often uses the label “radical”. (See also Liberalism in Germany, Liberalism in the Netherlands, Liberalism in France, Liberalism in the United Kingdom.)
- In Australia, a capital-l Liberal (often spoken as such) is a member or supporter of the right-wing conservative Liberal Party of Australia. A small-l liberal generally refers to someone who champions civil liberties and progressive causes such as Australian republicanism and Aboriginal reconciliation, as in parties such as the Australian Democrats. Small-l liberals are becoming less and less visible members of the Liberal Party. (See also Liberalism in Australia)
- Canada: In Canada, liberal refers mainly to the policies and ideas of the Liberal Party of Canada, the most frequent governing party of Canada for the last century and one of the largest liberal parties around the world. The Canadian Liberal Party supports a welfare state and is generally regarded as a party of the center left.
- New Zealand: In New Zealand liberalism refers to a support for individual liberties and limited government. The term is generally used with a reference to a particular policy area, e.g. “market liberalism” or “social liberalism”. Unqualified liberalism is less common; in its extreme form it is known by the American term libertarianism.
- Russia: The so-called Liberal Democratic Party of Russia is not at all liberal; it is a nationalist, right-wing populist party. Russian liberals are organised into the Yabloko and Union of Right Forces parties.
- United Kingdom: The Liberal Democrat Party in Great Britain generally supports social liberalism, while taking a centrist, largely pragmatic view on economics, supporting economic freedom and market competition in principle but often advocating more state/government provision or regulation to support particular policy objectives. Generally identified with the term ‘Liberal’ in current UK politics, they hold a comparatively small proportion of the seats in parliament, but manage to pull much higher percentages of the popular vote, almost 20% at the last election. Generally therefore, in the contemporary UK, ‘Liberal’ refers to an ideology advocating broad social freedoms, but less attached to economic liberalism.
- United States: The primary use of the term liberal is at some variance with European and even British usage. The common meaning of liberal has evolved over time. In the 19th century it was not a common term in American philosophy or politics, partially because the two main parties were a mixture of populist and nationalist elements. The Democratic Party was the party of free trade, low tariffs and laissez-faire entrepreneurialism, while the Republican Party advocated national citizenship, transparency and a stable currency. However, more than in other countries, United States liberals adopted in the 20th century an agenda in which individuals have a right, as members of the community, to expect that the community will regulate and influence the economy as a means to achieve social justice. This was a consequence of the choice of American liberals for Franklin D. Roosevelt’s New Deal, influenced by the ideas of British economist John Maynard Keynes, therefore leading liberalism to be identified with the so-called “welfare state”. The absence of social democratic forces and the necessity to prevent social unrest strengthened this development. After World War II, the term “liberal” was expanded to include all left-of-center (but anti-Communist) politics, particularly new liberalism. As McCarthyism made the terms socialism and even social democracy anathema in the U.S., the former New Dealers and others to the left of center adopted the name liberal. To distinguish themselves from these, those in the U.S. who were closer to classical liberalism, adopted the name libertarianss. The term libertarian is now used with similar meaning in a few other countries, but elsewhere, especially in Spain, it refers to libertarian socialists. Since approximately the Reagan era, the word liberal has been so much used as a derogatory term by U.S. conservatives that a lot of the U.S. center-left now shuns it, calling themselves “progressives”. (See Liberalism in the United States)
Liberalism and related ideologies
As explained in the preceding sections, there are several diverging (and sometimes opposing) strands of liberalism. In addition, there are also a number of ideologies and philosophies that influence liberals and liberal theory, or that share many common points with (a certain version of) liberalism. Social democracy can be considered liberalism’s closest “neighbor” on the left, while conservativism is liberalism’s closest “neighbor” on the right. Neoliberalism is a certain type of pro-market economic policy that arguably rose from the liberal tradition. It is often adopted by conservative, christian-democratic and social democratic politicians, not necessarily combining this with a liberal agenda outside politics. Libertarianism, which developed out of classical liberalism, is sometimes considered a branch of liberalism and sometimes a separate ideology in its own right.
See main article Neoliberalism. Neoliberalism is an economic ideology rather than a broader political ideology. The swing away from government action in the 1970s led to the introduction of this term, which refers to a program of reducing trade barriers and internal market restrictions as a way towards a more free market capitalist system. It does accept a certain degree of government involvement in the economy, particularly the acceptance of the need for a central bank and a capable national defense, but it seeks to reduce government regulation (and particularly taxes) as much as possible. While neoliberalism is sometimes described as overlapping with Thatcherism, economists as diverse as Joseph Stiglitz and Milton Friedman have been described — by others — as “neoliberal”. As said before, this economic agenda is not necessarily combined with a liberal agenda in politics: neoliberals often do not subscribe to individual liberty on ethical issues or in sexual mores. An extreme example was the Pinochet regime in Chile, but some will also classify Ronald Reagan, Margaret Thatcher, Tony Blair or Gerhard Schröder as being neo-liberal.
Liberalism vs. social democracy
The fundamental difference between liberalism and social democracy, besides the fact that they have very different origins, lies in their views regarding the role of the state in the economy. Social democracy seeks to achieve a certain extent of equality of outcomes, and upholds egalitarianism as the source of its moral values. Social democrats support a large public sector and the nationalization of utilities such as gas and electricity in order to avoid private monopolies, achieve social justice, and raise living standards for all. Liberalism, on the other hand, prefers much more minor state intervention, for example in the form of subsidies, and believes that major industries should be regulated, but not state-owned. Beyond that, however, liberalism shares many of the same basic goals as social democracy.
It should be noted that, in the 1990s, many social democratic parties adopted neoliberal economic policies such as extensive privatizations and open markets, much to the dismay of their own voters. This has led these parties to become de facto neoliberal, and often resulted in a drastic loss of their popular support. For example, critics of the German Social Democratic Party and the British Labour Party accuse them of pursuing neoliberal policies. This last case has led to the odd situation where the Labour Party, is seen by some (many?) as being to the right of the Liberal Democrats.
Libertarianism vs. “classical liberalism”
The modern tradition of libertarianism claims the ideological inheritance of “classical liberalism”. However, many object to this blending of what they see as two separate, opposing philosophies.
Those who emphasize the distinction between classical liberalism and libertarianism point out that even Adam Smith believed a free market could not satisfy all the demands of a society. Furthermore, some (Haworth, 1994, pp. 27) argue that libertarianism and liberalism are fundamentally incompatible because the checks and balances provided by liberal institutions conflict with libertarian support of complete economic deregulation.
Libertarians argue that the term “classical liberalism” was actually coined by Friedrich Hayek, who was deeply critical of modern liberalism. Libertarians also support the philosopher Frederic Bastiat, who advocated the absolute free market unreservedly. Several smaller libertarian parties around the world who identify themselves with the Austrian school of economics call themselves “liberals” without further qualification. Generally, this happens in countries where no larger “liberal party” exists, and thus there is no risk of confusion