The Decline of Classical Liberalism: 1860-1940

First, how significant and fundamental was the change in the nature of liberalism? Arblaster argues that the change was limited, with any differences between “classical” and “revisionist” liberalism less significant than what they shared. He also argues that any change that did occur in the nature of liberal ideology was limited and partial in its effect on liberal politics and argument. He thus emphasizes the persistence of “classical” liberal ideas within “revisionist” liberalism. Another who argues that change was small is Robert Eccleshall in his introduction to the documentary collection, British Liberalism: Liberal Thought from the 1640s to 1980s (New York: Longmans, 1986). However, Eccleshall minimizes the change by stressing “revisionist” elements in the thought of “classical” liberals and by disregarding important figures such as Herbert Spencer. Both Arblaster and Eccleshall also assert that liberalism remained the dominant western ideology even when explicitly liberal political parties had become peripheral.

In marked contrast, both Gray and Salvadori argue that liberalism underwent a fundamental change, or rupture, towards the end of the last century. Most of the historians who have studied this topic take a similar view. Michael Freeden’s The New Liberalism: An Ideology of Social Reform (Oxford: Oxford University Press, 1978) argues very strongly for this interpretation, as do Stefan Collini’s Liberalism and Sociology: L. T. Hobhouse and Political Argument in England 1880–1914 (Cambridge: Cambridge University Press, 1979) and Peter Weiler’s The New Liberalism: Liberal Social Theory in Great Britain 1889–1914 (New York: Garland, 1982).

Moreover, the “new” liberals themselves emphasized the extent of their departure from the “classical” model, as a quick glance at Hobhouse’s work will reveal. There were dozens of books and articles published between 1890 and 1930 by “revisionist” liberals that took a similar line, two typical works being Herbert Samuel’s Liberalism (London: Grant Richards, 1902) and C. F. G. Masterman’s The New Liberalism (London: Leonard Parsons, 1920). There are two issues of interpretation here. First, what value should be put on the protestations of the “new” liberals themselves? For Arblaster and Eccleshall these should be treated skeptically, on the grounds that as participants in an internal liberal debate writers like Hobhouse and Masterman deliberately sought to exaggerate the differences between their own views and “classical” liberalism. The contrary view would take them at face value. Second, there is the crucial question of definition: Who should count as a liberal? Only by arguing that Spencer should be regarded as a conservative and not as a liberal is Eccleshall able to minimize the differences between “new” and “classical” liberalism. This is certainly stretching things. If liberalism is defined in a way that excludes the more rigorous proponents of the “classical” tradition, then clearly the ideology becomes more homogeneous and any change less significant. If, however, it is defined loosely as to include everyone who is neither a revolutionary socialist nor a reactionary (as it is by Arblaster) then it again becomes hard to discern any real ideological change.

The second main issue is more straightforwardly empirical. When and how did the decline of “classical” liberalism take place? Unfortunately, there is little in English on developments in the major Western European states. In addition to the work of de Ruggiero and the introduction to the volume edited by Bramstead and Melhuish, there are four important works in English that deal with the fate of German liberalism: Leonard Krieger’s The German Idea of Freedom (Boston: Beacon Press, 1957), Donald G. Rohr’s The Origins of Social Liberalism in Germany (Chicago: University of Chicago Press, 1963), John H. Hallowell’s The Decline of Liberalism as an Ideology (Berkeley, CA: University of California Press, 1943), and James J. Sheehan’s German Liberalism in the Nineteenth Century (London: Methuen, 1982). For Italy and France the best short work is an article by D. Harris, “European Liberalism in the Nineteenth Century” (American Historical Review, Vol. 60, 1955). Arthur E. Ekirch’s The Decline of American Liberalism (1955; New York: Atheneum, 1976), written from a “classical” perspective, provides a clear guide to American developments and should be read along with Robert Higgs’s recent and pathbreaking Crisis and Leviathan: Critical Episodes in the Growth of American Government (New York: Oxford University Press, 1982). Another work on American liberalism, written from a “revisionist” position, is Harry K. Girvetz’s The Evolution of Liberalism (New York: Collier, 1963).

Much more attention has been paid to developments in Britain, partly reflecting the importance of developments there for the fate of “classical” liberalism worldwide. Most of the works focus on the period between 1880 and 1914 and the “debate between individualism and collectivism” that took place in those years. “Classical” liberalism did not succumb without a fight: the thirty years before World War I saw an intense debate between the two strands of liberalism and a vigorous attempt to proselytize and spread the ideas of “classical” liberalism. This was carried on by intellectuals and publicists grouped in a series of organizations, of which the most significant was the Liberty and Property Defense League, set up in 1882. The best short introduction to the debate is the first chapter of Stefan Collini’s Liberalism and Sociology, which should be supplemented by Harold J. Schultz’s English Liberalism and the State: Individualism or Collectivism? (Lexington, Mass: D. C. Heath, 1972) and the classic work of Albert Venn Dicey, Lectures on the Relation between Law and Public Opinion in England (1905; New Brunswick, N. J.: Transaction Books, 1981). For background, the best accounts are still two old classics, Helen Lynd’s England in the Eighteen Eighties (London: Frank Cass, 1968) and Elie Halevy’s A History of the English People in the Nineteenth Century: Epilogue, Vol. I Imperialism and the Rise of Labour; Vol. II The Rule of Democracy (London: Benn, 1961).

In addition to the works by Freeden and Weiler cited above, one should also consult Peter Clarke’s Liberals and Social Democrats (Cambridge: Cambridge University Press, 1978) and Freeden’s Liberalism Divided (Oxford: Oxford University Press, 1986), which covers the later period from 1914 to 1939. The essential text, however, is the magisterial work of W. H. Greenleaf, The British Political Tradition: Vol. I The Rise of Collectivism; Vol. II The Ideological Heritage (London: Methuen, 1983) and (in two parts) Vol. III A Much Governed Nation (London: Methuen, 1987). The central argument of Greenleaf’s massive work is that the fundamental division in modern politics is between what he calls libertarianism and collectivism. He argues further that the three main traditions of British (and western) politics—liberalism, conservatism, and socialism—all contain both libertarian and collectivist elements and that the period 1880 to 1940 saw a move from libertarianism to collectivism in all three, with the change in liberalism the most dramatic and far-reaching. Having defined his terms he goes on to look at the process of ideological debate and its outcome before offering various explanations. The great strength of Greenleaf’s thesis is that it can try to explain both the transformation of liberalism from “classicism” to “revisionism” and the failure of “classical” liberal analysis to sustain itself within other ideologies, such as conservatism.

Original Sources

As well as the analytical surveys of Greenleaf, Freeden, and Collini, many works by the participants in the original debate are still in print and easily available. There is also a substantial secondary literature on important individuals and groups. On one side are the self-styled “new liberals,” of whom the most important were J. A. Hobson, L. T. Hobhouse, D. G. Ritchie and J. M. Robertson, and, slightly later, C. F. G. Masterman. The English Hegelian T. H. Green is often included as the “founding father” of the group, although this is a matter of controversy. The most important works by these figures are: for Hobson, The Crisis of Liberalism (1909; Brighton: Harvester, 1974), The Industrial System (London: Longmans, 1909), and The Social Problem (London: J. Nisbet, 1901); for Hobhouse, The Labour Movement (1893; Brighton: Harvester, 1974), Liberalism (op. cit.), Democracy and Reaction (1904; Brighton: Harvester, 1972), and “The ethical basis of collectivism” (International Journal of Ethics, Vol. VIII, 1898, pp. 137–56). There are no modern editions of Robertson and Ritchie but they are well worth reading if obtainable; this is especially true of Ritchie. Ritchie’s main works were The Principles of State Interference (London: Sonnenschein, 1891), consisting of a series of essays he had written in response to Spencer’s The Man Versus The State in 1886–1887, and The Moral Function of the State (London: Sonnenschein, 1887). Robertson wrote a staggering number of books but the most important for this topic is The Meaning of Liberalism (London: Methuen, 1912). Apart from the work cited earlier, the most important of Masterman’s productions is The Heart of the Empire (London: Fisher Unwin, 1901).

In the secondary literature, apart from the second volume of Greenleaf, the one full-length study is Edward Bristow’s Individualism Versus Socialism in Great Britain, 1880-1914 (New York: Garland, 1987). Bristow has also written “The Liberty and Property Defense League and Individualism” (Historical Journal, Vol. 18, 1975, pp. 761-789). There are several relevant essays in Essays in Anti-Labour History: Responses to the Rise of Labour in Britain, Kenneth D. Brown, ed., (London: Macmillan, 1974), particularly “Laissez-Faire as Dogma; The Liberty and Property Defense League, 1882-1914” by N. Soldon and “Thomas Mackay: The Anti-Socialist Philosophy of the Charity Organization Society” by J. W. Mason. For the COS the essential work is Charles L. Mowat’s The Charity Organisation Society 1869-1913: Its Ideas and Work (London: Methuen, 1961).

Dating the Decline

To return to the question posed earlier, “when and how did ‘classical’ liberalism decline?” even cursory examination of the books and essays cited reveals that this is a rather difficult question. In all history of ideas there is a great danger of reading contemporary debates back into the past, of recognizing and emphasizing familiar elements at the expense of the strange and of interpreting people and debates in terms that are modern and anachronistic. Freeden and Collini are particularly aware of this, being followers of the “Cambridge School” of Quentin Skinner, which emphasizes the importance of intellectual context. There is, however, little agreement among scholars as to what that context might be. There are three main questions here, each with several possible answers.

First, what did each of the two parties to the debate see themselves as doing, what kind of enterprise did they feel they were engaged in? Both the “new” liberals and the individualists saw themselves as radicals, their opponents as reactionaries, and claimed to be the “party of progress.” For Freeden the “new” liberals were genuine liberals trying to change liberalism from within and to make it, as they saw it, more up-to-date. This approach emphasizes the difference between “new” liberals and other collectivists such as the Fabians. Others, like Clarke, stress the overlap between “new” liberals and Fabians, seeing both as belonging to one “progressive movement” that was not simply or even primarily liberal. A related argument comes from Collini, who sees the “new” liberals as primarily committed to a collectivist philosophy and only secondarily to liberalism, having decided to work through the existing discourse of liberalism and the Liberal party. With the individualists, problems of labeling are even more acute. Many were Conservatives and collectivism. It is therefore both an argument within liberalism and one between “new” liberalism and the libertarian variety of conservatism. Greenleaf argues that at first the argument was mainly within liberalism and the Liberal party but by the late 1890s most liberals had been won over to collectivism and the debate had been redefined as one The LPDL was largely funded by commercial interests. Many individualists, however, denied that they were in any sense Conservative and the ideas they produced were often anything but conservative. For Dicey and Schultz they were a mixture of liberals and conservatives trying to uphold “old style” liberalism against innovations from such as Hobson and Hobhouse. The problem with this interpretation is that the philosophy and programs of leading Individualists were not typical of earlier English mainstream nineteenth-century liberalism. One possible argument, suggested by J. W. Mason, is that, whatever their party labels, they were ideologically “classical” liberals who had responded to the challenge of collectivism by reviving the older tradition of writers like Thomas Paine, William Godwin, and Thomas Hodgskin (1832; The Natural and Artificial Right of Property Contrasted, Clifton, N.J.: Augustus M. Kelley, 1973). For Marxists such as Eccleshall the individualists were essentially conservatives engaged in producing an ideology to defend established interests (represented politically by the Conservative party) from the political challenge of labor and the ideological threat of the “new” liberals and Fabians. This model has difficulty in explaining the radical, even revolutionary, proposals of some of the individualists, such as Spencer, Donisthorpe, and Herbert, proposals that included the single tax on land, profit sharing, and the replacement of wage labor by a system of self-employment, not to mention repealing the marriage laws.

This leads to the second question: what was the nature of the dividing issue in the debate? For Lynd it was a matter of socialism versus liberalism, thus making the “new” liberals ideological socialists, the individualists liberals. By contrast, Arblaster sees it as an internal debate within liberalism, thus making both sides liberals but of different varieties. Freeden and Eccleshall both see it as a debate between progressive liberals and reactionary conservatives. The argument of the latter two thinkers is that ideas that were progressive in early to mid-nineteenth century and hence suitable for the “left” to espouse had become outdated and reactionary by the end of the century and therefore suitable fare for the conservative section of politics. This “whiggish” notion of ideological development is very widespread. For Greenleaf the debate between individualists and “new” liberals was only one part of a general debate taking place within all three main political traditions, the debate between libertarianism between liberals and ultraconservatives. Thus Spencer could say in 1884, “most of those now passing as liberals are Tories of a new type,” so placing himself and those who thought like him in the “true liberal” camp, while by 1895 he and his epigones such as Donisthorpe were almost universally regarded as Tories—a fact they recognized. In Greenleaf’s view the battle between libertarianism and collectivism was finally fought out within conservatism, hence the crucial importance of the dispute over Tariff Reform in 1904-6. By the 1920s, libertarian-“classical liberal” ideas had been defeated within the conservative tradition and relegated to the margins of politics.

There were similar debates in every major Western nation between 1880 and 1920, but the results were everywhere the same as in England: the defeat of those ideas defined as liberal in 1880. This had two consequences: The word liberal acquired an additional meaning and “classical” liberal ideas were eliminated from political argument.

Why Did Liberalism Decline?

The third major question is simply, why did this happen? For many commentators the answer is straightforward. Liberalism changed and “classical” liberalism declined because by 1900 it was an idea whose time had passed; it was no longer progressive. Behind this lies a teleological, “whiggish” view of history, which sees political philosophy as passing through stages en route to some distant end. Ideas that are progressive in one stage become reactionary in the next and ultimately irrelevant. This model can be criticized on many grounds but particularly because it imputes a false inevitability to history. So dominant is it, however, that other explanations are put forward only as secondary factors, subordinate to the notion of ideological progress. I shall briefly run through some of these and mention others that have received little investigation as yet, but merit further exploration.

One argument has it that “classical” liberalism was defeated in the 1880s and 1890s because the important battles had been lost some forty years before with the rise of the modern state. This was the view of Sidney Webb, expressed in many of his essays. There is now an enormous literature relating to the growth of the state in the early to mid-nineteenth century, most of it centering on the questions of whether there was an “age of laissez faire” and what role the Benthamites played. Schultz’s English Liberalism and the State (op. cit.) has an extensive bibliography.

The other arguments can be conveniently put into three groups. There are several intellectual or “idealist” theories, which explain the demise of “classical” liberalism in terms of purely intellectual developments. Some authors stress the importance of crucial concepts or theories, particularly idealism and scientism, the latter meaning the application of the methods and concepts of the physical sciences to the field of human action. The article by Freeden cited earlier exemplifies this approach. A related argument emphasizes the central role of particular individuals. T. H. Green is frequently cited in this regard, but almost as popular a figure for this role is J. S. Mill. Gray (in Liberalism, op. cit.) in particular argues that what he calls the bifurcation of liberalism first happened in Mill’s own work and that the status and influence of Mill gave his ideas and arguments tremendous influence. This was the view of Dicey, but other contemporary observers regarded Mill as an individualist. Mill’s ambiguity meant that both factions could claim him as their ancestor while his status led to a struggle for his mantle. A third idealist explanation sees the key factor in the intellectual failures of “classical” liberalism. In particular “classical” liberalism is supposed to have had an inadequate theory of the trade cycle and no satisfactory account of poverty and distributive justice. Certainly, the question of wealth and poverty and the distribution of goods was the area where the defeat of “classical” liberalism was most complete. Another frequently mentioned failure was the inability of “classical” liberals to produce a convincing concept of nationality that could be reconciled with liberal beliefs. One problem with this model is the evident intellectual vitality and inventiveness of the later “classical” liberals. They were not simply rehearsing old ideas but extending and developing them. One point however is clear. Even if the model that sees “classical” liberal ideas as outdated by 1900 is rejected, that was how they were seen by contemporary critics. The shift of language by which ideas regarded as “radical progressive” in 1870 came to be classified as “ultraconservative” thirty years later, without actually changing in content, or in their radical critique of existing society, was perhaps the crucial part of the wider process of decline. Other arguments concentrate on wider social changes. One, currently enjoying a revival, holds that “classical” liberalism was doomed by changes in the nature of politics, especially the development of mass democracy. This was a common view at the time, its classic expression being W.E.H. Lecky’s Democracy and Liberty (Indianapolis: Liberty Classics, 1981). Among modern writers Gray, Greenleaf, and Salvadori all put great stress on this. A related thesis emphasizes the impact of war and the preparation for war. In this model, on which Greenleaf elaborates in his third volume, wars and prolonged periods of international tension and deterrence (as in the years before World War I) led to a permanent expansion of the state and undermined an ideology that had difficulty explaining such a situation or in generating practical proposals to deal with it. (For America, see the work of “classical” liberal Garet Garrett, The People’s Pottage [Caldwell, Idaho: The Caxton Press, 1953], and Walter Karp’s The Politics of War [New York: Harper and Row, 1979], dealing with the Spanish-American War and World War I and their effect on American political life. Robert Higgs’s Crisis and Leviathan (op. cit.) includes valuable sections on “the political economy of war.”) Cultural change is also often used as an explanation (culture meaning not only cultural products but also a way of life). In the British context much stress is put on the decline of the distinctive culture of Nonconformity (e.g., in T. F. Glaser, “English Nonconformity and the Decline of Liberalism” [American Historical Review, Vol. 63, 1958, pp. 352–363).

Closely related are explanations that rely on accounts of changes in the class composition of society and in particular the growth of a large working class with a collectivist outlook, broadly conceived. Clarke takes this line in both of the works cited above, arguing that liberalism as a political philosophy had to change to reflect the actual experience and outlook of the new majority. The third class of possible explanations are materialist, emphasizing changes in material conditions and circumstances. Such an approach would differ from an orthodox Marxist one insofar as it would avoid both the deterministic and class-reductionist aspects of that “line.” It should be seen rather as a revival of the “liberal materialist” history of Buckle and the Scottish Enlightenment. This area has received little attention so far. One possible model would relate ideological developments to changes in technology, which from the 1870s onwards led to a series of economic developments that both undermined “classical” liberal assumptions and brought about patterns of life and work that were much more collectivist in their content and impact. The change in communications accompanying the rise of the mass-circulation press, leading to the appearance of a new kind of mass culture hostile to individualism, is another possible candidate.

Of course, the theories mentioned above are not exclusive; the scholars cited typically combine several of them.

The decline of “classical” liberalism, which may now be in a process of reversal, was a political transformation both subtle and profound. Much more work is needed before it can be adequately understood. In particular, we need much more work on the ideas and activities of the later exponents of “classical” liberalism (such as the LPDL), looking at such questions as their relation to the mainstream liberalism of the mid-nineteenth century. The decline of liberal beliefs among the mass of population, as opposed to the intellectual elite, is another important and unstudied topic, as is the whole question of the rise and demise of a liberal culture in literature and the arts. A detailed study of the change in political language and the way in which key terms came to change their meanings or pass from one discourse to another would also be very useful. Opportunities abound for research papers, journal articles, dissertations, and books in political science, historical sociology, history, philosophy, and related disciplines. In any event, we have here a topic that is important, wide ranging, and stimulating!

Stephen Davies is a senior lecturer in the Department of History and English at Manchester Polytechnic in Manchester, England.