An end to liberalism

Recently, The Economist celebrated its 175th birthday. As it reminded its readers, “in September 1843 James Wilson, a hatmaker from Scotland, founded this newspaper. His purpose was simple: to champion free trade, free markets and limited government. They were the central principles of a new political philosophy to which Wilson adhered and to which The Economist has been committed ever since. That cause was liberalism.”  

In its anniversary edition, the paper published a long and excellent review of what liberalism has achieved, and has failed to achieve, in the intervening years, and of where it stands today. The answer to the last point, to no one’s surprise, is that liberalism is in a much less healthy position now than it was on the paper’s 150th birthday. It is under assault wherever you look: from a protectionist US President, to assorted populist regimes around Europe and the world, to the growing ascendancy of an illiberal China.

The review also offered a comprehensive analysis of almost every policy area, national and global, and of what could and should be done to improve the status quo, to recapture the ground lost by liberalism and to advance into new territory. This amounts to a non-party political manifesto, and one that will be broadly shared by anyone with centrist opinions in any democracy (and in many non-democracies). So far so good. But where does this actually leave us? There are three questions, all of which the review touches on, none of which it is able to answer, but each of which is vital to the discussion.

They all stem from the first and most fundamental question: what is liberalism? As the article acknowledges, liberalism now encompasses economic, political, social and moral aspects. Nor do they necessarily go together. An ideological socialist, for example, could embrace social and moral liberalism, while rejecting economic and political liberalism. As the article also points out, in America liberalism is to many people a synonym for socialism, while in France it is a synonym for extreme free market economics. In Anglophone countries, liberal is an adjective that has become attached to the noun ‘elite’, which accounts for much of its current unpopularity.

The most important question, therefore, is whether there is any continuing value in a word that is capable of such elastic definition?

The second question is whether liberalism is an ideology or an attitude of mind. In its present incarnation, it cannot be an ideology. Liberalism is so broad and so varied that it can’t be codified into a single all-embracing creed. Yet, when Wilson founded The Economist, it was most certainly an ideology: an economic ideology. Liberalism was as dogmatic as Marxism in offering specific remedies to the momentous economic and social questions thrown up by the industrial revolution. (And, one might add, it has been a great deal more successful than Marxism in solving them.)

In that respect, Milton Friedman and his neo-liberal successors are the true heirs of liberalism, and the French are quite right in their definition of the word. So why does The Economist now advance the case for greater taxation on inheritance and capital? Because, as it somewhat coyly acknowledges, it has moved beyond its own founding ideology towards a broader definition of liberalism.

The article is endearingly honest in recognising the struggles that the paper has had with its founding principles over time, including the citation of positions taken that it would now rather forget. I think this has been all to the good. No ideology explains or solves everything. Circumstances constantly change, and processes of thought need to change with them. For The Economist, liberalism has rightly been an evolving creed, not a fixed ideology.

One such evolution has been from insurgent to insider – always the price of success. This raises the third question: can liberalism prosper as an orthodoxy, especially in an age of insurgency? At the beginning, The Economist was an outsider, and its adherents were outsiders. It assaulted the barricades of the old faiths – mercantilism, feudalism and nationalism – and defeated them. But for a long time now it has itself been the orthodoxy, with the same tendency to complacency, the same myopia towards its own deficiencies, that an easy ascendancy usually produces.

Admirably, The Economist still has the intellectual honesty to admit to these shortcomings. What to do about them is a more difficult matter.

In my recent thesis on the cotton trade in the mid 19th century, I quoted often from The Economist of the 1860s, because it was so good and so rigorous. In defending the cotton manufacturers against the charge that they had caused the Lancashire Cotton Famine themselves by over-producing cotton goods, the paper wrote: “The truth is this … ‘over-production,’ and ‘over-supply,’ are purely relative terms, and are so vague and inaccurate that it would be well if we could forego their use.”

Today, I think, the word liberalism has become so vague and inaccurate that it would be well if we could forego its use. It now carries so much baggage, a great deal of it undeservedly negative, that it is in danger of doing more harm than good to its own cause. I also think that its adherents should separate the economic and political elements of their creed from the moral and social, and concentrate their arguments on the former. (There is no shortage of others who will focus on the latter.) I also think that the flight from ideology should be maintained, but that the dynamism of insurgency needs to be rediscovered.

If the word is not liberalism, what is it to be? When a friend of mine was writing his MA thesis, he needed a word for God, but without the baggage of God, and proposed the word Ultima. We told him it sounded like a brand of washing powder. He didn’t agree. It is not easy to find a replacement for a word that everyone knows, and of which everyone has a different understanding.

May I propose the word ‘openness’? Still vague, I agree. But open economies, open politics and open societies remain at the heart of the argument. And if people talk in time of ‘the open elite’, it will at least sound as if anyone can join. No one objects to being called ‘open’. Just as, once, no one objected to being called ‘liberal’.