The Early Form of Liberalism

The early form of liberalism emphasising the individual is expressed in 1776 in the American Declaration of Independence, in Jefferson’s famous demand for rights to ‘life, liberty, and the pursuit of happiness’ against the tyranny of the British. In the same year Adam Smith published his work The Wealth of Nations which extols the usefulness of merchant capitalism and shows how beneficial it is for governments to invest in ports, roads, and other infrastructure which advances commerce. Smith supported individualism and argues in the book that individuals competing in the market place produces an ‘invisible hand’ working for the good of society. But the liberalism of the modern world needs to account for modern conditions and we need to look at how it developed after the beginnings of industry. The first writers to consider politics in this new era sought to adapt the older mercantile forms to the new realities, and they came up with laissez-faire liberalism. Writers like Jeremy Bentham in Britain were arguing that the new industries ought to be left entirely alone by governments because such a ‘hands off’ approach would in the long run produce ‘the greatest good for the greatest number’. A completely unregulated economy was emerging in which there was great suffering, but it was argued that wealth would trickle down.

The emergence of what is termed ‘classical’ liberalism came with John Stuart Mill, another British writer, who was writing from the 1840s to the 1860s. This does see a role for the state in the economy, but it is limited to ensuring that very minimal levels of health and opportunity exist. Individualism is still at the heart of classical liberalism and it places a very strong emphasis on self help and thrift. The basic form of interaction is the contract, which must be adhered to at all times, and the state is expected to enforce contracts, law and order, military defence, and some very minimal levels of health and education.