In Defense of Classical Liberalism
The classical liberals were, after all, liberals, even as we understand the word today. They valued personal liberty and moral equality, and were prepared to undertake radical social reform to advance those values.
I am a liberal—full stop. I am a “mere liberal.” I situate my political practice in the history of liberalism, drawing inspiration from the works of the “classical liberals,” and especially Adam Smith, Benjamin Constant, and John Stuart Mill. There is much in their writings of evergreen relevance to liberals today. But for just this reason, I resist efforts by libertarian conservatives to commandeer the classical tradition of liberalism. Many who now pretend to the title of “classical liberal” do so, not to advance liberalism, but to thieve the prestige of better thinkers, and to throw unearned glory over their own opinions. The phrase now risks becoming nothing more than a pompous and obscurantist piece of cant for conservatives.
Liberals must defend their history. What is the legacy of the early liberals? What is worth keeping and reviving? It is up to the liberals of today to present a truly liberal interpretation of classical liberalism, one that speaks to our current political problems and priorities.
I define classical liberalism in the strict sense as political thought and practice in the tradition running from Adam Smith to John Stuart Mill. It is not an abstract type; it is a particular, distinguishable period of history with a beginning, a duration, and an end, extending roughly from the 1770s to the 1870s. Liberalism of this period warrants the name “classical” for two reasons. First, it is the exemplar that defines its class. Adam Smith popularized use of the word liberal in a political sense in The Wealth of Nations (1776), with its vision of a “liberal system” contrasted against the older “mercantile system” of tariffs, monopolies, militarism, colonialism, and slavery. It is not his focus on liberty that makes Smith a liberal, but specifically his proposal to derive a system of policy from assumptions of universal liberty.
Benjamin Constant elaborates and codifies a complete liberal political programme in his Principles of Politics (1806), which takes up Smith’s ideas as extended and amended by Jean-Baptiste Say. These works mark the beginning of political liberalism. When, in the early 19th century, political actors and theorists in Europe began calling themselves “liberals,” it was in reference to just this programme. John Stuart Mill’s works (often written with contribution by Harriet Taylor Mill) including Principles of Political Economy (1848), “On Liberty” (1859), and others provide an epitome of this tradition.[1] In the 20th century, after a “new liberalism” emerged that was clearly distinct from the old, the phrase classical liberal was coined to refer back to this period retrospectively (not, I stress, to the work of John Locke or earlier figures).
Crucially, we identify other theories as varieties of liberalism on the strength of their resemblance to the classical theory, even as we distinguish them on the strength of their departures from it. For example, we identify earlier figures as precursors to liberalism when they anticipate identifiable and significant classical features. Similarly, we say that social liberalism is a kind of liberalism because we can see in it certain elements of the classical doctrine transformed, more or less, into something new. In short: the common thread of liberal doctrine running from Smith to Mill is the yardstick by which all “liberalisms” are measured.
Second, liberalism in this era is “classical” because it is thoroughly grounded in what we call the “classical school” of political economy. The two traditions emerged together and matured in parallel. Classical economics originated with Smith’s Wealth of Nations, which is above all a treatise on economic policy. As the classical school developed, liberal thinkers took its prescriptions as their own policy objectives. Both traditions shared an underlying view of the world, according to which human beings thrived under conditions of peace and voluntary exchange. One might say that classical political economy simply was the economic policy of liberalism of this era. Moreover, the decline of the classical liberal doctrine and the transition to the “new” social liberalism associated with Thomas Hill Green, Leonard Hobhouse, and John Maynard Keynes in the late 19th and early 20th centuries coincides with the decline of the classical school of political economy. The decline of classical political economy thus marks a shift not only within economics, but within politics as well. Classical liberalism and classical political economy were enmeshed; they shared a destiny.
With this definition, we can put the classical liberal style of thought clearly into view. In their historical and cultural milieu, the classical liberals had a radically progressive social agenda. They addressed themselves to a European audience restless for change. In the wake of the French Revolution, they embraced the values of liberty, equality, and fraternity, and saw their programme as the best realization, or the only possible realization, of those values. They drew on the traditions of civic republicanism and natural law, but they were willing to extend these traditions in ways that suggested social, legal, and political transformations reaching to the very foundations of society. They believed reform should be achieved peacefully and according to regular procedures whenever this was at all possible, and—especially in the case of continental liberals with memories of the French Revolution—by armed revolution only when all other options had been foreclosed. They advocated the abolition of slavery. They rejected absolute executive power in government and were critical of the centralized ministerial state. They also opposed oligarchy and the privileges associated with land ownership, hereditary ranks, and clerical office.
The classical liberals were all critical to varying degrees of empire. The earliest classical liberals were uniform in their unsparing opposition to colonialism. Smith’s view is representative. Colonies are economically burdensome to the colonizing nation. They are also morally corrosive. While the reach of the European empires brought new opportunities for global trade, for indigenous peoples,
all the commercial benefits which can have resulted … have been sunk and lost in the dreadful misfortunes which they have occasioned.… [T]he superiority of force happened to be so great on the side of the Europeans that they were enabled to commit with impunity every sort of injustice in those remote countries. (Wealth of Nations, 2:125.)
Smith goes on to express a hope that global trade will eventually erode the European power advantage, so that people of all nations can participate in global markets on equal terms.
Some classical liberals of a later generation were more ambivalent toward empire. They acknowledged the economic arguments against colonialism, but supposed that empire might be a necessary evil for some time into the future. Tocqueville believed that the French would fall into civil war again if they didn’t have a national project to unite them, and saw the conquest of Algeria as just the thing. John Stuart Mill, who began his career as an administrator for the East India Company, convinced himself that Indigenous and Asian peoples were not ready to govern themselves, and needed to be under paternalistic custody for their own good. For more on this change in the liberal outlook, see Jennifer Pitts’s A Turn to Empire (2006).
Everything wrong with these views had already been expressed clearly and effectively by earlier classical liberals, and indeed even contemporaries of Tocqueville and Mill, such as Richard Cobden and John Bright, who maintained the argument against empire. Liberals today can still draw upon their critical perspective to chart out a principled response to the legacy of colonialism.
The classical liberals all supported representative government, but debated the question how broadly the voting franchise should be distributed. Constant favoured limiting the vote to owners of real property generating an income sufficient to live on. This was not an unusual restriction in that era.[2] However, other classical liberals were early adopters of the more thoroughly democratic attitude we take for granted today. The Manchester Radicals, Cobden and Bright, advocated universal men’s suffrage. And, of course, Harriet Taylor Mill (writing as “Mrs John Stuart Mill”) argued for extending the franchise to women in “The Enfranchisement of Women” (1851). None of the classical liberals argued for applying new restrictions on voting, and their debates over the course of this period tend to favour universal adult franchise.
Though they differed in their moral theories, the classical liberals believed in the moral equality of all human beings—not that we are all equally righteous in our conduct, but that we are all equally deserving of basic respect and care for our well-being. Accordingly, they argued that social institutions should serve the interests of all, not just those of a ruling class, race, or faith, a powerful faction, or even the majority, at the expense of any part of it. But the classical liberals interpreted this task in a distinctive way. In their view, individuals are the best judges of their own interests. This is not to say individuals always correctly recognize their interests; both history and personal experience amply attest otherwise. It is, however, to say that no one else is better positioned to overrule individuals “for their own good.” Rejecting paternalism, the classical liberals maintained that government best serves the people by protecting them from oppression, providing them with means to use as they will in the conduct of their own affairs, and otherwise getting out of their way. This is the “obvious and simple system of natural liberty” which Adam Smith believed “establishes itself of its own accord” when government neither restrains people in the pursuit of their own interests nor favours the interests of some at the expense of others (Wealth of Nations, 2:184). As Constant puts it:
It is not a crime in man to mistake his own interest, always supposing he does so; it is not a crime in man to want to manage himself by his own lights, even when government finds them imperfect. It is a crime in government, however, to punish individuals because they do not adopt as their interest what seems so to other men or because they do not rank their own judgments of enlightenment beneath those of others…. To subordinate individual wishes to the general will, without absolute necessity, is gratuitously to set up obstacles to all our progress. (Principles of Politics, 322.)
And, as Mill famously writes:
The sole end for which mankind are warranted, individually or collectively, in interfering with the liberty of action of any of their number, is self-protection. … [T]he 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. (“On Liberty,” 223.)[3]
Government best advances everyone’s interests by providing a neutral legal and institutional environment to support individuals in making their own arrangements for themselves and for their communities.
The classical liberals also advocated positions that, today, we are used to thinking of as “conservative,” especially in economic policy. But they arrived at these positions while adhering to recognizably progressive principles. It should really be said that conservatives adopted large parts of the classical liberal programme when liberal policy victories, only ever partial and hard won against the objections of contemporary conservatives, became part of the status quo defended by conservatives of subsequent generations. The first “conservatives” were defenders of hereditary oligarchies, subsidies for landowners, commercial monopolies, and all the oppressive mercantile policies the classical liberals attacked.[4]
The classical liberals are most remembered today for advocating laissez faire, but we would do well to remember what this slogan meant for them. It was an argument against state-backed monopolies for joint stock corporations and subsidies for the “noble” and “gentle” classes of landowners. More generally, it was an argument against protectionism and regulation that strangled competition for the benefit of established interests and drove household costs higher than they had to be. This is all to say: laissez faire was an argument against using government power to transfer wealth from the poor to the rich. It was not an argument against regulation per se, where this had a rational purpose relating to public safety; nor was it an argument against tax-funded assistance for the poor (which, in their day, barely existed in a form we would recognize); nor was it an argument against equitable access to justice for those who had been wronged by the rich, the privileged, and the powerful. We might even extend this principle to modern anti-discriminaion law; the classical liberals didn’t contemplate it themselves, but their thinking gives us all we need to articulate the justification for it. The suggestion that anti-discrimination law is incompatible with classical liberalism is a conservative dogma that liberals need not accept.
The classical liberals recognized a role for government in “erecting and maintaining certain public works and certain public institutions,” as Smith puts it,
which it can never be for the interest of any individual, or small number of individuals, to erect and maintain; because the profit could never repay the expence to any individual or small number of individuals, though it may frequently do much more than repay it to a great society. (Wealth of Nations, 2:185.)
Highways, bridges, and canals, for example, support all kinds of activities. They are neutral with respect to the business of their users, whether they are competitors with one another, and so on. And they support many non-commercial uses as well. On similar reasoning, the classical liberals saw a role for government in recognizing business companies and certain trade associations, as long as they do not function as monopolies (ibid, 2:223–225)—these create a sort of immaterial “infrastructure” of institutions that empower individuals in their own projects to support themselves and their communities.
The classical liberals also recognized a role for government in funding education, though they were wary of the effects of giving government control over teachers. For Smith, the best argument for government support for education is that it offers children of poor families a way out of the drudgery of work under a highly refined division of labour (Wealth of Nations, 2:267–270). He also notes that government support for higher education lowers the barriers preventing entry into the skilled trades and professions, improving competition (Wealth of Nations, 1:131–134).
The classical liberals did not have a selfish “extractive,” “acquisitive,” or “possessive” view of human nature. They defended commercial society, not because they wanted individuals to be isolated from one another like “atoms” and pitted in an unwinnable war of all against all, but because they believed—rightly or wrongly—that it was by participating in civil society, including its commercial elements on their own terms that individuals drew greater strength from one another and could live together in peace, notwithstanding their differences. They advocated capitalism and free markets not because they wanted to reinforce social hierarchies, or because they believed common people should be beholden to their natural “betters,” but because they believed—rightly or wrongly—that open, competitive employment and capital markets tend to degrade social hierarchies, and liberate common people from the control of their so-called“betters.”
Classical liberals accepted private ownership of the means of production, not because they had a narrowly “formal” or merely juridical notion of equality and disregarded material well-being, nor because they believed people have natural and inviolable moral connections to their possessions. They recognized that property is a social construct; but this doesn’t mean it can be varied, redistributed, or abolished arbitrarily. Rather, they believed—rightly or wrongly—that, put to remunerative use in the circumambience of free markets, property benefits the whole community, non-owners as well as owners. Property becomes dangerous, however, when it provides access to political power, or to income that doesn’t require the owner to serve others. Before we declare the classical liberals refuted by history on any of these points, we might consider all the ways their opponents forced them to compromise their programme in its actual realization, with deleterious effects the classical liberals themselves often predicted.
The classical liberals were wary of big business, and believed in keeping arm’s length between business and government. Constant warns us, for example, that business people are ever ready with apparent reasons why government should restrict the activities of competitors and of the public to their benefit. As a rule, established business interests prefer the markets in which they operate to be free only as long as they believe they have a competitive advantage. But it is precisely when an economy is at its strongest that competitive advantages are hardest to come by.
When profits fall, business people are inclined to complain of the decline of trade. The diminution in profits is, however, the natural effect of progressive prosperity. Business profits fall: 1. Because of competition. 2. Because earnings rise, as a result of competition which increases labor prices. 3. By the increased flow of capital into commerce, which lowers the rate of interest. Now, these three causes of the diminution in profits are three signs of prosperity. This, however, is when business people complain and appeal about it to government, for special intervention, such that in the event, business people call for the intervention of government against commercial prosperity. (Principles of Politics, 249.)
This failure to respect the interests of the public isn’t unique to an owner or manager class, Constant continues, but affects us all when and insofar as we act as sellers (ibid, 250). But intervention tends to hurt us all when and insofar as we act as buyers and consumers—that is, as the enjoyers of prosperity, for whose sake goods are produced in the first place. It is not the role of government to ensure profit for anyone, and good government means resisting sympathetic temptations to intervene in markets to favour one interest over another, recognizing that it leaves us all worse off.
The classical liberals recognized that property and commercial rights cannot be absolute any more than can any other rights, precisely because one person’s exercise of these rights can come at the expense of others’ lives, the free exercise of their liberty, their own commercial interests, or the enjoyment of their own property. Moreover, the classical liberals didn’t seem to believe we could precisely delineate the scope of each individual’s sphere of private action by reasoning from abstract principles. They insisted that government has the authority and the duty to intervene in the private affairs of individuals when and to the extent the respective interests of individuals conflict with one another. But adversity of interests can arise in practically any area of human life. Even actions that are not wrong in themselves can contribute to public dangers indirectly. Deciding what actions must be prohibited in what circumstances is the legitimate object of politics in a representative system of government. What is essential is that the law must aim at prohibiting the actions that give rise to harms, rather than maligning and persecuting individuals according to their perceived worth.
To serve its function in upholding a lawful and neutral commercial environment, government needs to have the capacity to intervene as needed, and the classical liberals warned against making government weak on the misguided assumption that this would better secure personal liberty. They did not regard government as a necessary evil, or any evil at all, when it acts within its proper remit. They certainly never boasted of their contempt for it, as libertarian conservatives seem never to tire of doing, and nothing in classical liberal thought requires us to insult civil servants or disparage their work.
The classical liberals also recognized that their economic project was more controversial than their constitutionalism and the primacy they assigned to personal liberty. “I do not wish … to put commercial freedom and civil freedom at the same level,” Constant writes, because although he believed they are connected, he feared “that men who would disagree about the former might be just as likely to dispute the important principles on which the felicity of civil society and the security of citizens are based” (Principles of Politics, 227). Weighing economic liberties against civil liberties tends to bring both into doubt and discredit in the popular imagination. There is no suggestion in classical liberalism that its proponents should ever push their agenda in any way that would be prejudicial to the rule of law.
In a word: the classical liberals were, after all, liberals, even as we understand the word today. They valued personal liberty and moral equality, and were prepared to undertake radical social reform to advance those values. Their economic policy was grounded in progressive values, but interpreted in light of the best evidence and arguments of the social science of their time. With the decline of classical political economy in the late 19th century, the mainstream of liberalism moved on from its own classical period. Classical liberalism is no longer a living tradition, and there is something absurd about calling oneself a “classical liberal” nowadays. But as modern liberalism abandoned certain classical ideas, it wasn’t always in favour of better ones. What classical liberalism offered the public, for the first time in history, was a unified political programme rooted in radically progressive values, informed and inflected by a view of civil society that was both humanistic and scientifically sophisticated. It remains a model of how moral clarity, critical insight, institutional creativity, and attentiveness to social science can come together in the service of freedom, compassion, and social progress.
[1] Recent scholarship has explored Mill’s relationship to socialism. Matthew McManus discussed some of this literature in an article for Liberal Currents in 2022, and he has since contributed to that literature in his book The Political Theory of Liberal Socialism (2025). I set this issue aside for now. It warrants deeper discussion than I can give it in this essay. For my present purposes, I count Mill as a classical liberal for at least the early part of his career, though it remains an interesting question how far he deviated from the classical paradigm.. What matters for my argument is that he grounds his policy thinking in the classical school of political economy, even as he draws what might seem like surprising or uncharacteristic conclusions from it.
[2] France’s first experience of universal suffrage was the Reign of Terror; after the Revolutionary period, it would have property qualifications of one kind or another until 1848. British subjects at that time could vote in a county only if they were “forty shilling freeholders,” that is, owners of land in that county with annual rent of 40 shillings (£2) or more. Towns had their own local voting rules.
[3] Mill’s phrasing is significant, and marks a critical theoretical difference between classical liberalism and the libertarian “Non-Aggression Principle.” The latter principle justifies interfering with a person’s action when that action aggresses on another—that is, it does them direct harm. The classical liberal principle permits and requires interfering with a person’s action as needed to prevent harm, whether or not the impugned action directly causes it. As Constant emphasizes, actions may be innocent in themselves and yet expose others to significant harm. (See, for example, Principles of Politics, 383; 475; 534.)
[4] For an overview of the history of conservatism, see Edmund Fawcett, Conservatism: The Fight for a Tradition (2020).
Constant, Benjamin. Principles of Politics Applicable to All Governments. Translated by Dennis O’Keefe. Liberty Fund, 2003.
Mill, John Stuart. “On Liberty.” In Collected Works of John Stuart Mill, volume 18: Essays on Politics and Society, 213–310. Routledge, 1977.
———. Principles of Political Economy, 2 volumes. Liberty Fund, 2006.
Smith, Adam. An Inquiry into the Nature and Causes of the Wealth of Nations, 2 volumes. Methuen, 1904.
Featured image is Tocqueville at the 1851 "Commission de la révision de la Constitution à l'Assemblée nationale"
