The Truth About Liberalism

Ludwig von Mises, Founder of the "Austrian School" of Economics, and Proponent of Free-Market Capitalism

Ludwig von Mises, Founder of the “Austrian School” of Economics, and Proponent of Free-Market Capitalism

What is liberalism?  What is a liberal education?  Why do college students receive degrees in something called “liberal arts”?  Has liberalism always been what it is today?  These are fascinating questions.

Many people fail to understand that what is now referred to as “liberalism” was once known more by the terms “statism” and “socialism.”  The original version of liberalism–which is often known as classic liberalism–is now found among those who prefer smaller government and free markets.  As the power of monarchies in old Europe came crashing down with the Enlightenment and the dawn of modernity, the “liberals” back then were those who argued that government is valid only when it receives the approval of the people.  Those classic liberals understood that if economic freedom was granted to everyone, wealth could be pursued by all and would no longer be the prerogative of a few powerful lords and ladies.

We Americans are inheritors of this vision.  It came from the great thinkers of Europe and is enshrined in the founding documents of our nation.  “Life, liberty, and the pursuit of happiness” are specifically mentioned in the Declaration of Independence.  There we are told that the power of government is derived from “the consent of the governed.”  If government no longer assists us in securing these aims, “it is the right of the people to alter or to abolish it.”  Note that there is no mention in the Declaration that government should make us happy or give us the things that secure our happiness.  That is up to us.

Liberalism as originally defined was freedom from many evil things:  the powerful grip of royalty, excessive taxation, limits on legitimate business, forced enlistment in the army or navy, and from the destitution caused when economic power is held only by a privileged few.  Those early liberals were apostles of freedom.

The right of kings and princes to rule was a divine right, one granted by Almighty God–or so the people were told.  Who told them that?  The princes and kings, of course.

The first people who engaged in the free exchange of goods or services put a kink in the armor of the powerful.  All it took was for one person to trade something to someone else, not because they were told to do so, and not because a feudal prince demanded it.  They did it because it was of economic benefit to themselves and their loved ones.

With that first exchange the notion of economic liberty was born.  The Genie of Power and Control was out of the bottle.  Kings, princes, and sometimes even popes have been trying to put that genie back ever since.  You see, it’s not just the genie that has a name.  The bottle also has a name.  It’s called Government.

The freedom of making one’s own economic choices has proved its power to make the lives of everyone better.  With its arrival a new light burst upon the affairs of humanity.  As economist Ludwig von Mises wrote in his book Liberalism, “a magnificent economic development took place.  The release of man’s productive powers multiplied the means of subsistence many times over.”  The ideas of classic, original liberalism dropped the infant mortality rate, increased health, and destroyed “the barriers that in earlier ages had separated the lords and serfs.”

But woe to the growing middle class!  When there is creation of genuine wealth, the tax collector is never far behind.  Princes may be rare today or may supposedly be curtailed by constitutions, but we humans lose our abilities to reason when it comes to the hard work and wealth of others.  Under the guise of guaranteeing equality, the monarch has returned to America but with a new name:  the federal government.

Government feeds upon the anxiety and greed of the people who would rather know immediate gratification than long-term security.  As Mises tells us, the light of a free economy emancipated humanity from a society where power was in the hands of “the special interests of certain classes.” In response, what did powerful government do?  It involved itself in those formerly free transactions and once again granted power to its chosen classes of special interest.

This was done, of course, under the guise of securing equality.  What was really guaranteed was not equality but statism, powerful centralized government that increasingly meddled in the affairs of citizens at all levels.  Then, insult was added to injury:  powerful statists and their socialist supporters hijacked the name “liberal.”  Twisting the facts, statists repainted the world to convince the greedy that the free exchange of goods and services was the cause of all the world’s misery and poverty.  The truth was just the opposite.  Those who tried to point this out were labelled as “dangerous” and “radical.”

These days, it would appear that Ludwig von Mises was right:  “nothing is left of liberalism but the name.”  Today’s liberals–who have stolen the name “liberal” from those who value freedom–spend their time condemning the advocates of free markets.  Capitalism, they claim, promotes “only the special interests of certain classes.”  Nothing could be farther from the truth.  Only government has the necessary power to guarantee the success or destruction of any class of people.

America has come full circle.  Is it an economic monarchy that we want?  Call them presidents, senators, congressmen, or bureaucrats–if they wield excessive power they might as well be princes or kings.

Imagine an economic and social system where powerful people constantly tell you what to do, and how to do it.  Imagine that these powerful people live extraordinary lives of privilege.  Imagine that they have armed men and women to enforce their will.  No matter how often they tell you that their actions are “for the common good,” it still sounds like monarchy to me.

Do you duty as a free citizen tomorrow.  Revolt.  Do it peacefully, but revolt.  Remind the political elites that you are not a serf.  We don’t have princes in America.  We don’t have kings.  And we don’t want them.

Mises was inspired by the legendary character Faust, taking for himself the immortal words with which I leave you.  I beg you to remember them tomorrow as you vote:  “No man deserves his freedom or his life who does not daily win them anew.”

Quotations from Ludwig von Mises are drawn from the introductory chapter of the 2012 reprint of his 1962 edition of Liberalism (Important Books imprint, first paperback edition).  The text is also found online, compliments of the Ludwig von Mises Institute at Auburn University.  To access the online version, click HERE.  


9 thoughts on “The Truth About Liberalism

  1. WOW!

    This has been my favorite post by The Liberty Professor to date!

    (Of course, I’m biased towards articles that are pro-Mises!)

    I would love to read the Liberty-Professor’s book review of Mises’s “Liberalism”! Please consider it.I think it’s one of many works by Mises every American ought to read.

  2. Another great post!!! I will get Mises book “Liberalism”. I’m a senior citizen but living in such uncertain times, I need all the knowledge I can gather.

  3. I like this one alot. Hopefully, there will be a company or at least a platoon of liberals returning from Afghanistan next summer.

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