Evolution of Classical Liberalism Flashcards
(38 cards)
4 principles of classical liberalism
Natural Right
Limited Government
Rule of Law
Consent of the Governed
Natural law
Personal freedom refers to the absence of coercion in the various realms of life
Includes free speech, religious liberty, right of private property, right of political opposition
Limited government
State is an instrument serving a particular function in society and is not in general charge of all society
Rule of law
Equality of right implies that all must abide by the same laws, which the state enforces with impartiality
Consent of the governed
Government emanates from the people, is responsible to them, and may be changed by them. It is a moderate and practical statement of the doctrine of popular sovereignty
John Kenneth Galbraith
Argued that increases in wealth in the United States were concentrated more and more among people with high incomes, and people with low incomes were not earning more
Encouraged efforts to reduce the gap - war on poverty, large-scale publicly funded education programs
Few industries demonstrate perfect competition
What kind of system did principles of liberalism establish?
The largest number of citizens can achieve the greatest autonomy possible
Each individual free to pursue their own interest unencumbered by government
Supported democracy and free markets
Key doctrine of classical economics
A laissez-faire attitude by government allows the invisible hand to guide everyone in their economic endeavors, create the greatest good for the greatest number of people, and generate economic growth
Welfare state
Economy is capitalist, but government uses policies that directly or indirectly modify the market forces in order to ensure economic stability and a basic standard of living for its citizens
Ways Smith’s theory reflects principles of liberalism
Individual autonomy is emphasized
Private property is considered a natural right providing the basis for working in one’s own self-interest
Government is limited to public works, ensuring rule of law and protection of private property
Kenneth Galbraith, war on poverty
Efforts to reduce gap between high and low income people
Encouraged large-scale publicly funded education programs
Britain’s traditional economy
Based on subsistence farming
Importance of Great Britain’s island
Highly dependent on sea trade, led to a large commercial fleet, powerful navy
Provided the means for the creation of many personal fortunes for enterprising ship owners and merchants
Many merchants had large amounts of money available for investment
Enclosure Acts
Series of laws that served the interests of merchants and landowners by forcing thousands of low-income farmers away from farmland and into towns and cities - uncommonly large pool of cheap labour
3 factors that came together in Britain during the Industrial Revolution
New ideas of human potential and human worth - commoners could create wealth and achieve status
Government friendly to business and innovation
Huge amount of investment capital and cheap labour, large number of inventors and innovators who were encouraged by the possibility of reward
Physiocrats
Led to laissez-faire capitalism
Enlightenment thinkers who critiqued mercantilism
Believed that the pursuit of self-interest in economic affairs would benefit everyoneMe
Mercantilism
The aim of all economic pursuits should be to strengthen the power and wealth of the state
Smith’s justification for self-interest
By having every individual look after his or her own best interests, he or she unwittingly ends of helping everyone else by providing jobs and cheaper products
Smith’s beliefs in role of the government
Limited to maintaining the rule of law, ensuring contracts were followed, and to providing some public works like primary education and road maintenance
Enclosure/Consolidation Act
Allowed enclosures on farms because of mounted pressure, invention of new agricultural technologies that required large enclosed fields, and liberal beliefs in the sanctity of private property
Farmers received minimal compensation for their small strips of land, fewer agricultural labourers were needed on mechanized farms
Farmers forced off the land became a large workforce for new factories
Where did large-scale production begin?
In the textile industry
Effects of Industrial Revolution on class structure
Wealth was previously derived from land ownership. Aristocratic class that controlled land dominated social structure
As industrialization progressed, new class arose with factory owners, bankers, lawyers, engineers. They gained substantial wealth and challenged the aristocratic class for power and position
Urbanization
Large segments of the population migrated to cities in the 19th century
Led to overcrowding and unsanitary living conditions, with tenants sometimes being exploited by landlords
Grassroot Movements
Protests against the effects of capital liberalism and capitalism
