Liberalism: two incompatible traditions

Social liberalism and neo-economic liberalism are largely incompatible. The former is under threat in the current wave of right-wing populism.

In the wake of Brexit and Trump, it is fashionable for political commentators to say that liberalism is in retreat. Yet what they fail to mention is that that there are two, and two largely incompatible, political traditions of liberalism. So talking about them as if they were one makes no sense.

The first, social liberalism, is the "good" liberalism, namely. In outline, this is a movement that gives rights to individuals to do their own thing, and argues for people not to be coerced by governments unless they are doing something which materially harms others. For social liberals the state exists to uphold personal and civic rights and to regulate the free market, and redistribute money, so that the operation of the capitalist economy doesn’t negate those rights in practice.

The second is the "bad" tradition of liberalism, which is called neo-economic liberalism - or otherwise known as market fundamentalism. The modern founders of this school were economists like Hayek and Friedman who argued for the untrammelled free market enforced by a nightwatchman state. The inequalities and injustices thrown up wherever this ideology has been allowed free rein are so large that it can only be imposed in illiberal regimes, such as Pinochet’s Chile after 1973, or in today’s Singapore with its hangman’s rope and rattan canes.

Quite clearly the Brexiters and Trumpists want to trash social liberalism, but the jury is still out on whether their intentions, rather than some of their rhetoric, will result in a full reversal of the neo-economic liberalism which has been the dominant world ideology and practice since the end of the 1970s.