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Classical Liberalism: An Overview

A personal interpretation of the ideology, and why it's necessary.

by James Leroy Wilson
September 7, 2010

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Classical Liberalism: An Overview

In May, 2009, I wrote a column about two 20th-century figures, generations apart in age and worlds apart in matters of religion and lifestyle. They were Gresham Machen, godfather of American Christian fundamentalism, and Frank Zappa, rock composer.

Although they were very different people, I detected that they had the same underlying ideology: Classical Liberalism.

I revisited the subject of Classical Liberalism two weeks ago. I argued that Classical Liberalism is an ideology with an agenda, NOT a political philosophy with strict principles.

This is what distinguishes itself from libertarianism, which is a political philosophy and principle based on self-ownership. Classical liberals need not agree on a particular philosophy; they could be as diverse as Machen and Zappa. They don't even have to agree on the form of government. They just agree that the classical liberal agenda contains positive goods for everyone.

Inspired by the concept of Classical Liberalism articulated by Ralph Raico, I would summarize, and in a couple of cases re-frame, Classical Liberalism as the ideology that advocates:

  • Private Property
  • Free Exchange
  • The Rule of Law
  • Civil Liberties
  • Free trade

The following is a brief summary of what I understand these five concepts underlying Classical Liberalism to be.

Private Property

No one believes that private property owners have the right to do whatever they please on their own property. They cannot commit violence. They cannot pollute. If their purchase of the property was on condition of a covenant with strict requirements and regulations regarding building and upkeep, these contractual obligations must be respected.

But even if private property ownership is qualified by the above restrictions, governments now treat us as if all property really belongs to the government, and we must ask for permission for everything we do:

  • If you make improvements on your residence at your own expense, you increase its "value" and therefore your property tax bill - even if you have no desire to sell it
  • You are subject to eminent domain laws in which the government can seize your land not just to build military fortifications for defense, but to give it to a private business in order to "improve the economy"
  • Your property is subject to civil asset forfeiture laws, as local, state, and federal law enforcement can take and keep your property without even charging you for a crime, and make it almost impossible for you to get it back
  • Governments regulate the kind of business you do on your own property, even if you don't cause traffic hazards or noise pollution for your neighbors
  • Governments legislate who can and can't enter your private property, and how you treat guests

In the eyes of government, your home is not your castle, and your place of business is nothing more than an administrative arm of the government. To own property does not make you freer, it just make you subject to even more government intrusiveness.

Free Exchange

The word "market" seems to set off alarm bells in some people's minds. They associate the word with unscrupulous sellers placing profits above all. No matter how tightly regulated and distorted the market may be, every mishap or catastrophe is blamed on the "free" market.

But it is not "the market" that needs defending. I will rather defend the free choices of people, the voluntary exchanges of individuals. A free economic exchange occurs when both persons involved:

  • Engage in it voluntarily
  • Do not have to seek permission
  • Are not coerced (by government or anyone else) into making the exchange
  • Are acting in good faith (such as, no fraud or negligence)

If two people want to make a trade, of money for something, or something for something, and neither one willfully or negligently harms the other, what business is it of anyone else? How is this unjust? How is "the public" endangered so that the government must step in?

The only reason governments step in is that the government, and perhaps voters who back the government, simply doesn't like some of the free exchanges carried on by their neighbors. Government needs its share of the pie. Government also needs to put more people in jail to tell the people it is successfully fighting "crime."

As a result . . .

  • Legal tender laws make it impossible for alternative forms of currency, from gold and silver to voluntary community-based scrip, to compete with the government's inflated Federal Reserve Notes.
  • Barter exchanges, which by definition are "even trades" at the agreement of the parties involved, must be reported on income tax forms
  • Wages and salaries, which are by definition "payment in exchange for work," must be reported as "income" for tax purposes, even though these were also mutually agreed-upon "even trades."
  • Working conditions and wages cannot be made between employer and employee, they must be determined by federal legislation which in many cases empower unions at the expense of workers who would rather negotiate their own terms of employment
  • Government seeks to prevent bad things from happening through uniform regulations that a) are proportionally costlier for smaller businesses, making it more difficult for them to compete against large corporations, and b) are of a one-size-fits-all nature that force businesses to comply with the regulation rather than in actually making their workplaces and products safer
  • AND, the government prohibits many things that some people want to buy and others want to sell, creating black markets run by violent thugs.

To promote free exchange is to promote the rights of consenting, responsible persons to pursue their own good. Even if you want to keep in place an age requirement, such as saying "consenting (18 or over) adults" you would STILL be promoting more free exchange than we presently have.

Today's regulations prevent the unemployed from using their cars as taxis, and from providing meals, haircuts, and massages from their own homes. It is clear to me that those who advocate government monopolization of money and punishments of consensual behavior have nothing but hatred and contempt for the poor.

The Rule of Law

The rule of law relates to powers and limitations on each branch and level of government. The purpose is that no single person or branch of government has too much arbitrary power. But it is more than that. It is a signal that the people know what the laws will be. While Classical Liberalism as an ideology is seen throughout the West, let's place this in an American context. If Congress passes a bill "authorizing" the President to start wars, to detain people indefinately without a court hearing, or to have his underlings issue regulations on private enterprise, we are relying on the rule of men, not of law.

The concept of the Rule of Law can't possibly be executed perfectly anywhere in any system of government. Moreover, we shouldn't be under illusions about America's past and Presidential misdeeds. But at least when crimes were committed by most 20th-Century Administrations, there was usually enough respect for decency and The Rule of Law so that there was a cover-up. They knew they were guilty. But our two most recent Presidents are quite brazen about torture, assassinations of U.S. citizens, and spying on Americans without search warrants.

When the government is the chief cause of abuse and injustice and the courts can't or won't help you, it's every man for himself. I've heard it said that anarchy is law without rulers, whereas chaos is rulers without law. We see what happens in countries where rulers aren't bound by law. Do we want that to happen here?

Civil Liberties

By Civil Liberties I mean respect for personal privacy, freedom of conscience and religion, freedom of speech, press, and other forms of expression, and equal protection of the law.

In one sense, the U.S. has retained some respect for these values in that even most critics of the so-called Ground Zero Mosque concede the right of Muslims to build it. While the courts have stripped away civil liberties in relation to the War on Drugs, War on Terror, and so-called "commercial" speech, they have generally been favorable to the rights of religious minorities, artists, and non-violent protesters. A major victory for free speech this year was the Supreme Court's Citizens United case which removed some barriers to free political expression.

Ideas must not be suppressed and minorities, even hated political and religious minorities, must not be oppressed. Your speech may be controversial some day. Your affiliations may be subject to public scorn. You WILL be a civil libertarian fighting for your own rights when that day comes. Your best protection is to fight for the rights of people you disagree with today!

Free Trade

"Free Trade" does NOT mean "Free Trade Agreements" between the U.S. and other countries. Those are loaded with exceptions, special favors, and regulations.

Free Trade means, rather, the unilateral elimination of all tariffs. Or, if tariffs are essential to funding the government, Free Trade means tariff policy serving ONLY the goal of tax revenue but otherwise has minimal market distortions. This means tariffs rates won't discriminate by industry or country of origin: all would see the same flat tariff rate.

Let's say the U.S. was the only country that could grow apples and "Banania" was the only country that could grow bananas. It would be in our interest to sell apples to Banania in exchange for their bananas. The two countries don't even have to agree with each other's internal political systems and policies. Banania's problems are not our problems, and if we try to punish Banania for being insufficiently democratic or some other reason, and try to make them change their ways by withholding our apples, they will likely retaliate and withhold their bananas.

As a result:

  • The U.S. government's self-imposed apple export restriction leads to a glut of apples in the domestic market, diminishing their price and ruining growers
  • The worldwide market supply of bananas is diminished, leading to higher prices

America's apple growers and banana consumers would be hurt - all because of their own government's policies.

Free Trade is really just a broader extension of Free Exchange. If the person you're exchanging with is in another country, who cares?

At the same time, the implications for diplomacy and peace are far greater. When a country imposes a tariff or embargo on another country - for either protectionist or ideological reasons - it is telling that country's government: "We couldn't care less if your people starve to death."

I'm not saying that every person ought to find the cheapest price for a good, no matter its origin. That is up to you. Personally, I think communities would be stronger if they spent more money on their neighbor's businesses than seeing their money sent to Bentonville, Arkansas or China.

But just as neighbors who do business with each other tend to be friendly toward each other, countries that trade with each other don't go to war with each other. If you don't like another country's policies, sneak into that country and become a rabble-rouser. But don't support tariffs, sanctions, and embargoes in our country that will punish your fellow citizens with lower sales and higher prices.

* * *

Classical Liberalism is taken for granted in the United States, so much so that it is despised. Many people don't like property rights when the other person's property is "blight." They don't like free exchange when it's "immoral." They don't like due process of law when the accused is a suspected terrorist. They don't want freedom of speech for Flag desecrators or freedom of religion for drug users and polygamous cults. They want to punish other countries for their ability to make some products cheaper than we can.

But when it is their own property, their own choices, their own rights, their own opinions and religion, or their own foreign exchanges that are under attack, EVERYONE becomes a Classical Liberal. All that Classical Liberalism asks is that you support the rights of your neighbors and fellow citizens as much as you would want them to support you.

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