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Essay/Term paper: Differences and similarities of liberalism

Essay, term paper, research paper:  History Essays

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Differences and Similarities of Liberalism

The purpose of this paper is to treat the similarly and differences of
liberalism. I will use John Locke and Adam Smith to represent classical
liberals. John Stuart Mill and John Maynard Keynes will be used to show
contemporary liberals.

John Locke

In John Locke's Second Treatise of Government he develops a theory of
government as a product of a social contract, which when broken justifies the
creation of a new government for the protection of life, liberty and property.
He begins his argument by developing a theory of the state of nature which is

...what state all men are naturally in, and that is, a state of
perfect freedom to order their actions and dispose of their
possessions and persons as they think fit, within the bounds
of the law of nature, without asking leave or depending upon
the will of any other man.1

The state of nature includes the "...law of nature to govern it, which obliges
everyone; and reason, which is that law, teaches all mankind who will but
consult it..."2 The state of nature also includes inequality

...since gold and silver, being little useful to the life of a
man in proportion to food, raiment, and carriage, has its value
only from the consent of men, whereof labour yet makes, in
great part, the measure, it is plain that men have agreed to a
disproportional and unequal possession of the earth.3

In Locke's state on nature there are also three distinct problems. First
there is no established settled known law. As each man consults his own law of
nature he receives a slightly different interpretation.
Secondly there no known and indifferent judge. Which creates the
problem of trying to decide which is the correct law of nature which will be
followed in an impartial manor.
Thirdly there is insufficient force of execution. This is the problem
of how to carry out the decision of the law of nature on another when he has a
different interpretation or doesn't consult the law of nature.
Locke states that the three problems in the state of nature would be
best solved by coming together to form a new government to protect there

The great and chief end therefore, of men's coming into commonwealths,
and putting themselves under government, is the preservation of their

And goes further into what this new government should be empowered to do

firstly...established, settled known law, received and allowed by
common consent to be the standard of right and wrong, and the
common measure to decide all controversies between them...
secondly...there wants a known and indifferent judge, with
authority to determine all differences according to the
established law...thirdly...There often wants power to back
and support the sentence when right, and to give it due execution.
They who by any injustice offend, will seldom fail, where they
are able, by force to make good their injustice...5

In Locke's government men only give up the right to the above mentioned
things, to create the law for themselves, to judge the law for themselves, and
to execute the law for themselves. These are the only rights that the
government has the right to interfere in as it is the only reason that people
entered into a commonwealth. Locke also explains the new social contract that
the new government should operate under. The first point of the contract is
that the people agree to form a body politic, in which the majority rule.
Second the body politic selects a government of the day. (elects people on a
regular basis to the government to legislate the law)
Locke laid out who should be allowed the right to vote, who shouldn't be
allowed to vote and gives his reason why.

...all men as members for the purposes of being ruled and only men
of estate as members for the prepossess of ruling. The right to
rule (more accurately, the right to control any government) is
given to the men of estate only: it is they who are given the
decisive voice about taxation, without which no government can
subsist. On the other hand, the obligation to be bound by law
and subject to the lawful government is fixed on all men whether
or not they have property in the sense of estate, and indeed
whether or not they have made an express compact.6

Johns Stuart Mill

There is no difficulty in showing that the ideally best form of
government is that
in which the sovereignty, or supreme controlling power in the last
resort, is
vested in the entire aggregate of the community.7
It is with this statement that Mill begins his augment in The Ideally
Best Polity showing his believe in Locke's democracy but saying that all people
could be best served by the government if everyone could vote. As this is the
only way the government learns what it needs to know in order to govern. He
comes to this concussion by saying that participatory democracy is the best
answer to the two questions that he poses as to what makes a good government.

...namely how far it promotes the good management of the affairs
of society by means of the existing faculties, moral, intellectual,
and active, of its various members, and what effect in improving or
deteriorating those faculties.8

Mill believes that it is necessary to expand the role of government not
only to protect the people from the government but to promote liberty by putting
limits on what can be expressed as public opinion against a minority, and to
involve people in the government so as to give them stimulation and help them
In Mill's writings he also discuses the idea of liberty and what limits
government and public opinion should have on interfering with a individuals

...the only purpose for which power can be rightfully exercised
over any member of a civilized community, against his will, is to
prevent harm to others. His own good, either physical or moral,
is not a sufficient warrant.9

Differences Between Locke and Mill

Although Locke and Mill both believe in government by and for the
governed there chief difference is in the idea of who the government is for.
Where Locke believes that the purpose of government is to protect property,
there for if you did not have property you didn't have anything to protect and
shouldn't have a voice in the government. Mill believes in an participatory
democracy in which everyone should have the right to vote as it is a way of
bettering society as a whole and making sure that everyone's interests are
consulted. They also differ on the role the government should play in the lives
of the governed. Locke advocates a government which doesn't have any power to
interfere in the lives of the governed out side of protecting their property.
Where Mill would like to see a government which attempts to better the lives
that it governs and protect them form the tyranny of the majority.

Adam Smith

In 1776 Adam Smith published a book titled The Wealth of Nations in
which he recorded his ideas on the way the money and the economy worked. He had
came to some important concussions about how the market worked which went hand
in hand with why the government shouldn't interfere in its workings.

There are three main points in his idea of capitalism the first
was self interest...a drive to maximize income...by concluding
the best possible bargain on the marketplace into which everyone
ventured, either to sell his or her labor power or other
resources, or to purchase goods.10

Second competition would act as a regulator

For each man, out to do the best for himself with no thought of
others, is faced with a host of similarly motivated individuals
who are in exactly the same position. Each is only too eager to
take advantage of his competitor's greed if it urges him to
raise his price above the level "set" by the market.11

Thirdly the idea of supply and demand would automatically regulate what is
produced, the quantity produced, quality of goods, and increase efficiency in
the production process. "...the changing desires of society lead producers to
increase production of wanted goods and to diminish the production of goods that
are no longer as highly desired."12

John Maynard Keynes

While Keynes agreed with Adam Smith on the way the market place works he
noted that the wealth of an economy depends on the amount of money flowing and
the rate at which it flows. This means that the market place was prone to
certain types of macro economic illness. These illesses are

First, that an economy in depression might well stay there; there
was nothing inherent in the situation to pull it out. Second,
that prosperity depended on investment; for if savings were not
put to use, the dread spiral of contraction began. And third,
that investment was an undependable drive wheel for the economy
threated with satiety, and satiety spelled economic shrinkage.13

Keynes reasoned that

...if investment could not be directly stimulated, why then, at
least consumption could. For while investment was the capricious
element in the system, consumption provided the great floor of
economic activity...14

He looked to the government to maintain the macro economy. Saying that if
consumption could be controlled in a way to heat up the economy when it is
running cold and cool it down when it is running hot. This was to be done
through the policies of

...monetary control, mainly centered in the Federal Reserve banking
system. By easing or tightening the reserve requirements that all
banks had to maintain behind their deposits, the Federal Reserve
was able to encourage or discourage lending, the source of much
economic activity. In addition, by buying or selling government
bonds, the Federal Reserve was able to make the whole banking
system relatively flush with funds when these were needed, or
relatively short of funds when money seemed in excess supply.
...second was tax adjustment...By raising or lowering taxes,
particularly income taxes, the government could quickly increase
or diminish this broad flow of purchasing power.
...third was the federal budget...In inflationary times, a budget
surplus would sere to mop up part of the inflationary purchasing
flow. In depressed times, a budget deficit (covered by borrowing)
was a mechanism for generating a desired increase in that flow.15

Similarities common to liberals

Classical liberals held the believes that the government should be for
thoughts who were governed and held property. Inaddision that the governments
only role should be to protect peoples property and shouldn't interfere in any
other part of peoples lives.
Contemporary liberals believe that the government should take a much
more active role in the lives of the governed both to better society and to
protect it form fluctuations of the business cycle.
All liberals believe that government should be held responsible to the
governed to serve there secular purposes. That capitalism is the corner stone
of the free market society and that the government should not directly interfere
in the micro economy. And lastly in individualism that we are all free,
rational, equal, act only according to our own consent, and have a right to
voluntary association.


In drawing this brief account of the liberal-democratic analysis of
equality to a concussion we are properly struck by the significant distance
which separates the contemporary, revisioist idea from that of its classical


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