Home' Policy Magazine : Policy Vol 33 - No 4 Contents 34 POLICY • Vol. 33 No. 4 • Summer 2017-2018
REBUILDING THE LIBERAL PROJECT
Despite the obvious frustrations with the
establishment elite, it is a simple fact that 2016
was the first year in recorded human history when
less than 10% of the world’s population were living
in extreme poverty. This was realised in spite of
the establishment elite’s policies, and instead was
due to the power of economic liberalism even
when restricted and constrained. Smithian trade
and Schumpeterian innovation simply offset and
pushed ahead of the obstructions of government
stupidity.30 As Joel Mokyr likes to point out,31 there
are tail winds and head winds, and as long as the tail
winds are stronger than the head winds, progress is
inevitable. Liberalism provides those tail winds.
The challenge for liberalism in the 21st
century is the same as in the past—there will be
conservative forces that provide the head winds.
These conservative forces come in the form of the
entrenched interests of the status quo establishment
elite, and the populist movements on the left and
the right who, while criticising the establishment,
demand simply more of the same policies just in
greater proportion—more government intervention,
more regulation of industry, more restrictions on
the movement of people, more restrictions on the
flow of capital, and so on.
There can be no alliance between the liberal and
the populist precisely because populism is illiberal.
It is discriminatory, and it seeks not to limit power
but to put different people in power. The natural
ally of populism is planning and militarism.
It has fallen on the current generation of true
radical liberals to stand up against the threats to basic
human equality, to stand up against intolerance, to
fear, to meddlesomeness. We must embrace Hayek’s
challenge and explore the philosophical foundations
of a free society with a renewed excitement and
invitation to inquiry. And we must, above all else,
insist that liberalism is liberal in thought, in word
and in deed.
1 F. A. Hayek, ‘The Intellectuals and Socialism’, The University
of Chicago Law Review 16:3 (1949), 433.
2 It is important to note that true liberalism differs greatly
from the rhetoric of ‘litmus test’ libertarianism, which is
particularly unhelpful for thinking about what rules of
social interaction enable us to live better together than we
ever could in isolation. For a critique of what I call the error
of ‘litmus test’ libertarianism, see Peter J. Boettke, ‘True
Liberalism is About Human Compassion’ (Foundation for
Economic Education, 10 November 2017), https://fee.org/
3 See appendix in F. A. Hayek, Law, Legislation and Liberty,
vol. 3 (Chicago, IL: University of Chicago Press, 1979).
4 See James Buchanan’s address to the Mont Pelerin Society
on ‘The Soul of Classical Liberalism’. These calls are not
for a change in human nature, but for a cultivation of an
understanding and appreciation of how a change in the rules
that govern social intercourse can channel our behaviour
into productive and peaceful interactions. J. Buchanan,
‘The Soul of Classical Liberalism’, The Independent Review
5:1 (2000), 111-119.
5 The anti-globalisation movement of the 2000s and the
Occupy Wall Street protests in the wake of the global
financial crisis of 2008 reflect the populist left, while the
rise of the paleo-conservatives, paleo-libertarians, economic
nationalist segments of the Alt Right movement represent
the populist right. I am leaving out of the discussion the
odious racial politics that is also intermingled here in the
populist discussions of the US and in Europe concerning
immigration, refugees and public policy.
6 See F.A. Hayek, ‘The Pretence of Knowledge’, American
Economic Review 79:6 ( 1989), 362.
7 Adam Smith, An Inquiry into the Nature and Causes of the
Wealth of Nations (London: George Routledge and Sons,
8 L.M. Mises, Human Action (Auburn, AL: The Ludwig von
Mises Institute,  1998), 67.
9 F.A. Hayek, The Fatal Conceit: The Errors of Socialism, The
Collected Works of F. A. Hayek, edited by W. W. Bartley,
III (Chicago, IL: University of Chicago Press, 1988).
10 Hayek, ‘The Pretence of Knowledge’, 7.
11 I still find one of the most persuasive statements of
the underlying attitudes of a liberal society to be Steve
Macedo’s Liberal Virtues (1990), and of the institutional
infrastructure that might follow to be Chandran Kukathus,
The Liberal Archipelago (2003). The cultivating of mutual
respect and dignity accorded to each that a liberal order
must entail does, as my colleague Tyler Cowen argued
in Creative Destruction (2002), turn on the homogeneity
of some beliefs at the rules level of analysis while the
celebration of heterogeneity at the within rules level. It is a
question ultimately of the relevant margins that enable the
operationalisability of cosmopolitan liberalism. S. Macedo,
Liberal Virtues: Citizenship, Virtue and Community in
Liberal Constitutionalism (Oxford: Oxford University Press,
1990); C. Kukathas, The Liberal Archipelago: A Theory of
Diversity and Freedom (Oxford: Oxford University Press,
Populism is illiberal. It is discriminatory,
and it seeks not to limit power but to put
different people in power.
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