State Intervention: A Liberal Defence

By Paul Hindley 

The issue of state intervention has often been a contentious one for liberals. Classical liberals especially those in the laissez-faire or libertarian tradition have often stated their rejection of state intervention especially on the grounds of economic affairs. Classical liberals would oppose anything other than the most extremely limited economic intervention; believing such intervention to be corrosive to individual freedom.[1] It shall be argued that state intervention; especially state economic intervention can be justified on liberal grounds and furthermore that it does not corrode freedom but in fact enables and enhances freedom.

The spectrum of liberal philosophies ranges from centre-left to right wing, their common thread is that they each seek to promote and enhance the freedom of the individual. There are two dominant conceptions of liberty, those of negative and positive liberty. Negative liberty is the freedom from restraint and coercive authority.[2] Positive liberty is the freedom the individual has to develop and enhance their individuality.[3] While all liberals are suspicious of the reach of the state’s power and the state’s capacity to erode civil liberties; it is only the liberals on the left who pay much credence to the perspective of positive liberty. Social liberals in particular have come to acknowledge the fact that social and economic inequalities may indeed limit the freedom of the individual.[4] Hence the state is justified in intervening in economic affairs and redistributing wealth in order to enable the poorest in society. Thus the state is an economic enabler.

The preamble to the Liberal Democrat Constitution states that “no one shall be enslaved by poverty, ignorance or conformity.”[5] This statement implies quite rightly that the social factors of poverty, ignorance and conformity can indeed enslave the individual and curtail their freedom. Hence giving the state justification to ensure a viable redistribution of wealth and a state funded education system. This embodies the developmental individual freedom associated with positive freedom.

The intellectual roots of the modern Liberal Democrat party lie in the New Liberal Movement of the early 20^th Century. New liberalism (not to be confused with free market neo-liberalism) has a basis in the writings of philosophers such as Thomas Hill Green and Leonard T. Hobhouse. Today, we refer to new liberalism as social liberalism. The philosophy of new liberalism was at the heart the Welfare Reforms of the Liberal Government of 1906-1914. State intervention was seen as necessary to enhance the freedoms and rights of individuals suffering from crippling levels of Edwardian poverty. The welfare reforms included the first old-age pensions, unemployment benefits, maternity benefits and National Health Insurance. In 1911, Leonard T. Hobhouse wrote “we constantly define the rights of the individual in terms of the common good, and think of the common good in terms of the welfare of all the individuals who constitute a society.”[6] Hobhouse confirms the social liberal view of human nature, as being one that is altruistic. The concern for the welfare of all individuals, especially the poorest, forms the basis of the social liberal conception of social justice.

The qualified collectivist policies of the Asquith Liberal Government were enhanced further by the Welfare State of William Beveridge. Beveridge believed state welfare was necessary to combat the five giant evils of “want, disease, ignorance, squalor and idleness.”[7] In harmony with state based welfare were the policies of the social liberal economist, John Maynard Keynes. Keynesianism emphasises the need for the state to intervene in the economy so that capitalism could be stabilised and regulated in-order to achieve economic growth and full employment. Keynesianism became the dominant philosophy of the capitalist West between the end of the Second World War and the rise of neo-liberalism in the 1970s and 1980s.[8]

The Liberal Democrats and prior to them the Liberal Party have had a belief in state intervention ever since the Liberal Welfare Reforms and the Peoples Budget of the early 1900s. This tradition was reinforced by the injection of social democracy that came from merging with the Social Democratic Party (SDP) in 1988. Hence the Liberal Democrats have a long-lasting tradition of state intervention to prevent economic inequalities becoming too large. The Liberal Democrats historically have not been afraid to pursue social justice and state intervention by the means of progressive taxation. Up until 2006 it was still Liberal Democrat policy to increase the top rate of income tax to 50% for everyone earning over £100,000.[9] Furthermore throughout the 1990s the Liberal Democrats stood on a policy of “a penny for education.”[10] This is a social concern for education that is echoed in the party’s current policy priority to enact the pupil premium. Also progressives around the world, and especially those in the Liberal Democrats, seek the paramount importance for the state to intervene in environmental affairs in order to protect the natural environment and prevent the rise of climate change by reducing the amount of greenhouse gases that are emitted.

The social liberal concern for the poor and the welfare of all individuals is central to positive liberty. The freedom to grow and develop is an essential right of all individuals. In order to achieve this, the individual must be freed as much as possible from poverty, ignorance and conformity. This naturally lends itself to a justification of state intervention in order to reduce these social conditions. The state therefore has a social responsibility to protect and enhance the welfare of all of us and in thus doing so; it will enhance the freedom of the individual. The state can henceforth be an enabler. It is only an enabling state that can truly defend and enhance the freedom of the individual. Therefore as liberals, if we are concerned about liberty we must therefore understand that although it is vital that individuals are free to do as they wish; they must also have the freedom to break out of the shackles of inequality that coerce them; especially those caused by poverty.

Paul Hindley is a Liberal Democrat, Social Liberal Forum and Liberal Left member based in Blackpool, he recently graduated from the University of Lancaster. You can find and follow Paul on Twitter. 

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