Liberalism and the Welfare State

This weekend I finished my book on the 1848 revolutions and started Roger Garrison's Time and Money (something of a restatement of Hayek's Prices and Production). The book was very good, but there was an interesting part at the end on the relationship between nineteenth century liberalism, revolution, the resolution of the "social question" (i.e. - unemployment), and the rise of the welfare state in the conclusion that I wanted to share. I know this might sound a little odd to some readers, but there is actually a contingent out there that believes that the American welfare state emerged out of Bismarkian authoritarianism, and that it wasn't derived from, say, long liberal struggles with the issue in the 18th and 19th century and an even longer history of poor relief in the colonies that was ultimately derived from Great Britain (here, here, here, and here for a start). They often ignore this broader history and highlight the work of German-ancestry progressives in the early twentieth century that contributed to an already robust reform movement (never mind the fact, of course, that a lot of these German immigrants - like the Kuehns who had left Hesse - were escaping conscription and repression in Bismark's Germany). Anyway, this was an interesting paragraph from p. 407 of the book:

"Namier's term, a 'seed-plot of history', can be applied to this aspect of 1848 because the revolutions of that year witnessed the fatal consequences of the perennial tension between, on the one hand, the liberal emphasis on political freedom and civil liberty and, on the other, the socialist stress on social justice, or the friction between the individual and society. Since 1848 this tension has provoked a wide range of responses, ranging from liberal capitalism to totalitarianism and all points between. Most modern democracies cope with the social question because it is debated within a constitutional framework on which all parties are (more or less) agreed and which protects democratic freedoms. In 1848, no such political consensus existed in most European countries. The 'social question' could therefore not be resolved within a peaceful, legal framework. So the revolutions faced the great challenge that confronts all modern states: how to integrate the masses into the state and to resolve the social question without provoking instability? Some states, such as the French Third Republic and Britain, managed to forge a political consensus by appealing to traditions (in the French case, to the democratic inheritance of 1789), which enabled them to offer some social reform through liberal, parliamentary systems. Others imposed reform from above through more authoritarian regimes, as in Bismark's Germany during the 1880s. A third solution was revolutionary, where integration of the masses failed, or was not even seriously attempted, and where alienation lead to a violent challenge to the old order, as in Russia, where the result was a totalitarian answer to the social question, in which the needs of society and, above all, the state took precedence over the liberty of the individual."

This probably won't move some people. There are of course those who see any constitutional expression of a social contract for solving social problems as threat to human liberty. Even among those who accept constitutional liberalism for whatever reason, there are those who will argue that Roosevelt and other 20th century progressives had more in common with Otto "iron and blood" Bismark than French and British parliamentarians. Nevertheless, I think the author's point that (1.) yes this is a tension, and (2.) it was resolved in a variety of ways, shouldn't be lost on people who claim the mantle of classical liberalism. Earlier in the text, the author notes that "the social question ulcerated the liberal regimes because there was no revolutionary consensus". Despite the absence of such consensus, claims are regularly made by modern libertarians that engaging this question is an abandonment of classical liberalism. A consensus on the social question, in other words, is retroactively imposed on the 19th century by these modern libertarians.

I'd also just note the strong Public Choice Theory/James Buchanan understanding of constitutionalism in the passage I presented above.