Modern liberalism is generally considered to be in the center of the economic spectrum and is based upon the idea of a mixed economy that includes elements from both the left and right.\u00a0 It first emerged out of the late 19th and early 20th centuries with the rise of socialist movements and values that swept across Europe and North America at the time.\u00a0 Historians consider the emergence of socialism, and in turn modern liberalism, as a response to some of the appalling conditions present in classical liberal societies of the Industrial Revolution.\u00a0 Modern liberalism was preceded by classical liberalism and both are part of liberalism as an ideology.<\/p>\n\n\n\n
The main principles of modern liberalism focus on balancing individual freedom with the collective interest of the larger society. Modern liberals believe that while personal liberty and free choice are essential, the government also has a responsibility to ensure fairness and protect citizens from exploitation and inequality. As such, modern liberals support a mixed economy, where both private enterprise and government programs work together to promote growth and social welfare.<\/p>\n\n\n\n
Modern liberalism also values the concept of equal opportunity, which means that everyone should have equal access to education, healthcare, and jobs regardless of their background. As well, modern liberalism emphasizes the promotion of human rights, democracy, and the rule of law as foundations for a just and free society. In short, modern liberalism seeks to create a society where freedom and equality work together in an attempt to create a more equal and just society.<\/p>\n\n\n\n
As an ideology, modern liberalism is associated with the center of the economic and spectrum because it allows for elements from both socialist ideologies and capitalist ideologies, combined with individual rights and freedoms and the principle of rule of law. As such, economists consider modern liberal societies to be examples of a welfare state and mixed economy.<\/p>\n\n\n\n
One of the primary causes of the Industrial Revolution was the emergence of\u00a0laissez-faire capitalism\u00a0as an economic system.\u00a0 Laissez-faire capitalism is a highly individualistic ideology in which the government plays as little a role as possible in the economic decisions of a country.\u00a0 Historians often refer to the ideology of the Industrial Revolution as classical liberalism since it included the principles of laissez-faire capitalism while also promoting basic individual rights.\u00a0 This political and economic climate created a situation in which wealthy factory and mine owners were able to exploit working-class people.\u00a0 As a result, this led to\u00a0horrible working conditions\u00a0for the people of the Industrial Revolution in both Europe and the United States.\u00a0 For example,\u00a0child labor\u00a0was a common feature of the Industrial Revolution with children as young as four working in dirty and dangerous conditions without protection from the government.\u00a0 As time passed, socialist ideologies emerged in response to this exploitation, and tried to solve the perceived failures of classical liberalism.<\/p>\n\n\n\n
Several prominent socialist ideologies that emerged at the time included:\u00a0Marxism\u00a0and\u00a0utopia socialism. Marxism is best associated with\u00a0Karl Marx\u00a0and the system of ideas he established in his books \u2018The Communist Manifesto\u2019 and \u2018Das Kapital\u2019.\u00a0 In each book, he argues against the exploitation of the working-class and for a more equitable society in which there are no class divisions.\u00a0 Utopian socialism is best associated with\u00a0Robert Owen, who owned a factory in New Lanark, Scotland, during the time period of the Industrial Revolution.\u00a0 He operated the profitable business while also treating his workers well.\u00a0 For example, he provided basic education and healthcare to his workers while also paying them a decent wage.\u00a0 He proved it was possible for wealthy owners to still make a healthy profit while sharing their wealth with their workers.\u00a0 The growth of these socialist movements was significant because of the impact they had on the world in the decades and centuries that followed.\u00a0 For example, throughout the 20th century socialist ideologies transformed classical liberal societies and laissez-faire capitalism to a more mixed economy based upon the principles of the\u00a0welfare state\u00a0and modern liberalism.\u00a0 This included more collectivist principles, such as: economic equality, cooperation, public ownership and collective-interest.\u00a0 As such, most modern democracies include elements from both sides of the economic spectrum.\u00a0 This is important, because while modern liberal societies include collectivist or socialist principles, they are still fundamentally based on key classical liberal principles, including: individual rights and freedoms, rule of law, some degree of economic freedom, completion, self-reliance and private ownership.<\/p>\n\n\n\n
This shift left for classical liberal societies continued during the early 20th century and the events of the Great Depression.\u00a0 This is especially true in the United States, which responded to the events of the Great Depression by fundamentally transforming its economy.\u00a0 The Great Depression in the United States began in 1929 with the stock market crash and continued throughout the rest of the 1930s until\u00a0World War II\u00a0began in 1939. \u00a0It was characterized by years of high unemployment and a lack of consumer spending. \u00a0As well, the events of the Dust Bowl worsened life for many working-class people and farmers.\u00a0 Similar to the effects of the Industrial Revolution, the Great Depression was characterized by a period of time in which working-class people struggled.\u00a0 As a result, governments around the world, including the United States, tried to end the crisis by intervening in the economy to create programs to end the recession and get people back to work.<\/p>\n\n\n\n
\u200bThe first major impact of the Great Depression was the election of Franklin D. Roosevelt in 1932.\u00a0Herbert Hoover\u00a0was the President of the United States at the start of the Great Depression and held a general view based on self-reliance.\u00a0 This means that he believed it was the responsibility of individuals to take care of themselves and not rely on assistance from the government.\u00a0 As such, he did not agree that the government should intervene in the economy and referred to the economic hardship of the Great Depression as \u201ca passing incident\u201d.\u00a0 As a result of his presidency, many working-class people began to name aspects of their poverty after Hoover.\u00a0 For example, shanty-towns that were constructed on the edge of cities in the 1930s were often referred to as \u2018Hoovervilles\u2019.\u00a0 In the 1932 presidential election, Hoover faced off against Democratic candidate Franklin D. Roosevelt.\u00a0 Roosevelt offered a completely different view of the recession and ran on the platform of a \u2018New Deal\u2019 for the American people.\u00a0 With unemployment over 20% in 1932, Roosevelt blamed the worsening economic conditions on Hoover\u2019s mishandling of the crisis.\u200b<\/p>\n\n\n\n
As a result, Roosevelt won the election in a landslide victory winning 472 electoral votes to Hoover\u2019s 59.\u00a0 Roosevelt\u2019s presidency was one of the most significant in all of American history due to his role in major world events such as the Great Depression and World War II.\u00a0 When he took office on March 4th, 1933, the economy was in a downward spiral.\u00a0 Unemployment had increased and industrial production had dropped drastically.\u00a0 As a result, he set out right away to begin implementing many of the measures of his New Deal.\u200b<\/p>\n\n\n\n
The New Deal was a series of government initiatives and programs aimed at ending the economic devastation of the Great Depression.\u00a0 Many historians agree that the New Deal included two distinct stages.\u00a0 The First New Deal occurred from 1933, when Roosevelt took office until 1934, and focused on issues related to banking.\u00a0 The Second New Deal occurred from 1935 until 1938 and focused on several important programs including the Social Security Act.\u00a0 In general, Roosevelt\u2019s plan was for the federal government to spend money in an attempt to achieve three goals:\u00a0 economic recovery, job creation, and investment in public works projects.\u00a0 The policies of the New Deal had a profound effect on the United States and created several different programs that are still in existence today.\u00a0 For example, the Social Security Act established old age pensions, unemployment insurance and benefits for the disabled and dependent children.\u00a0 This idea of federally-funded social assistance programs emerged out of the New Deal and continues today.\u00a0 This was a dramatic change for the United States, which had previously been based more on principles of individualism and caused the country to shift more towards the center of the economic spectrum and towards modern liberalism.\u00a0 Over the next 80 years, many more social-assistance programs were created, but they were generally built upon the foundation of the Social Security Act of 1935.\u00a0 The emergence of federally-funded social assistance programs fundamentally changed the political landscape of the United States for several decades following the Great Depression.\u200b<\/p>\n\n\n\n
Due to the economic crisis facing the United States at the time, the federal government undertook a high level of intervention in the economy in hopes of helping working-class people. In general, this had a profound effect on the United States and resulted in a dramatic shift in American politics.\u00a0 The best example of this is the election of Franklin D. Roosevelt and the creation of the New Deal.\u00a0 As stated previously, the New Deal was a collection of policies and programs aimed at stabilizing the economy, combating unemployment and ending the panic of the economic collapse that began with the stock market crash in October of 1929.\u00a0 The implementation of the New Deal saw the United States combine aspects of socialism with its more capitalist history.\u00a0 In general, socialism is a left-wing economic system that favors government intervention in the economy in order to try to solve economic issues.\u00a0 At the time, socialist policies were popular around the world and were causing many countries to change their policies.\u00a0 American politics and economics had been much more right-wing in the decades before the Great Depression.\u00a0 This meant that the United States was based upon the principles of capitalism, which is the idea that the government should play as little a role as possible in the economy and allow people to have more control over their own economic wellbeing.\u00a0 The policies of Roosevelt and the creation of the New Deal fundamentally shifted the United States left on the economic spectrum to a form of capitalism that economists refer to as the\u00a0welfare state.\u00a0 Modern liberal democracies such as the United States are considered to be based on mixed economies and the welfare state.\u00a0 For the next several decades, American politics were centered on a relatively increased role for the government in the lives of average citizens.\u00a0 The United States would not make another large shift right until the election of Richard Nixon in 1968 and again in the 1980s with the presidency of Ronald Reagan.<\/p>\n\n\n\n
In part, the further development of modern liberalism in the United States during the Great Depression came from the ideas of John Maynard Keynes.\u00a0 Just as economist Adam Smith influenced classical liberalism with his ideas in \u2018Wealth of Nations\u2019, Keynes influenced modern liberalism.\u00a0 Keynes was a British economist during the early part of the 20th century and had a profound impact on economic theory during the Great Depression.\u00a0 His most famous economic proposal and best known work, was published in 1936 and was titled \u2018The General Theory of Employment, Interest and Money\u2019. The book outlined Keynes\u2019 idea that when national economies suffer a downturn, as happened in the Great Depression, governments should borrow and spend money to boost economic activity. Keynes argued that by doing so economic growth would occur, and some of the proceeds could be used to repay the debt incurred. Keynes\u2019 theory influenced President Franklin D. Roosevelt and his establishment of the programs and policies of the New Deal.<\/p>\n\n\n\n
Therefore, modern liberalism emerged as a result of the hardships experienced by working-class people during the Industrial Revolution and Great Depression, especially due to the conditions present in classical liberal societies based on laissez-faire capitalism.\u00a0 Socialist movements developed throughout the late 19th and early 20th centuries and transformed classical liberalism into modern liberalism through the increase of government intervention in the economy.\u00a0 As stated above, this occurred from the creation of social programs that were designed to benefit the collective-interest of society.\u00a0 For example, the programs of the New Deal included elements of collectivism.\u00a0 Other modern programs and initiatives are examples of a modern liberal society.\u00a0 These include: public education, public healthcare, labor unions, workers\u2019 rights movements, minimum wage laws, etc.<\/p>\n\n\n\n
As an ideology, modern liberalism is associated with the center of the economic and spectrum because it allows for elements from both socialist ideologies and capitalist ideologies, combined with individual rights and freedoms and the principle of rule of law. As such, economists consider modern liberal societies to be examples of a welfare state and mixed economy. It developed in response to the perceived hardships created by classical liberalism in the 19th century and the early 20th century in England and the United States during the time frame of the Industrial Revolution and the Great Depression. Today, most modern democratic countries are some degree of modern liberalism, including: United States, England, France, Canada, etc. As such, when people today consider the positives and negative aspects of modern liberalism they often use the impacts of industrialization and economic recession to determine their response.<\/p>\n\n\n\n
First off, there are several positive aspects of modern liberalism.\u00a0 On the positive side, a mixed economy benefits society because it focuses on the principles from the both the left (collectivism) and right (individualism) sides of the spectrum.\u00a0 This is positive because it means that a mixed economy does not contain the extreme left elements of a command economy or the extreme right elements of a free market economy and it instead tries to strike a balance between both.\u00a0 As such, many economists argue that a mixed economy is more stable because it can change to the conditions of the economy and be more free market or command when needed.\u00a0 For example, usually in a mixed economy, the government intervenes less in a period of boom which is when the economy is doing well.\u00a0 However, when the economy is in recession, the government generally intervenes more in order to prevent a crisis and improve the overall economy.\u00a0 Furthermore, under a mixed economy, the government still allows free market principles, thereby still allowing for self-reliance and competition in the economy.\u00a0 At the same time, a mixed economy avoids the issue of income disparity common in a classical liberal society under a free market economy, because it allows government intervention that steps in to provide basic social programs if people are in need.\u00a0 Therefore, many consider a mixed economy to be a system that balances the needs of the citizens with their freedoms.\u00a0 Furthermore, another positive of modern liberalism is that while it includes elements from the left side of the spectrum, it still allows for both individual rights and freedoms and rule of law.\u00a0 These principles are important in maintaining a society based on democratic values and their inclusion ensures that citizens in modern liberal countries enjoy freedom from oppression by their own governments.<\/p>\n\n\n\n
Another positive development of classical liberalism was the emergence of rule of law.\u00a0 Similar to the development of rights and freedoms, rule of law protected citizens from the authoritarian rule of absolute monarchs.\u00a0 For example, the concept of rule of law is based on the idea that a country should be ruled by a distinct and clear set of laws instead of the individual rule of a singular person.\u00a0 Rule of law also holds that all people are equal before the law, including the rulers.\u00a0 As such, the development of rule of law in societies across Europe and the United States were positive because they limited the rule of the government and protected the security and well-being of individual people.<\/p>\n\n\n\n
With that said, there are several negatives associated with modern liberalism. As stated above, modern liberalism is best associated with a mixed economy since it is also in the middle of the economic spectrum and includes elements from both the left and right. First, a mixed economy contains more government intervention than a free market economy (through taxation) and therefore may not lead to the periods of boom that a free market economy does. The taxation required to fund the social programs puts a burden on private businesses and limits their ability to thrive. This problem highlights another issue with mixed economies, which is finding the right balance between socialism and laissez-faire capitalism. Although a mixed economy contains elements of both, it can be a struggle to truly find a balance and governments may sometimes intervene too much and other times intervene too little. Furthermore, mixed economies sometimes struggle from large income gaps, just as free market economies do. Although mixed economies contain social programs such as welfare to avoid these gaps, the programs often do not do enough to truly stop wide gaps from growing between the rich and poor. As such, modern liberal societies with mixed economies often still struggle with the issues of poverty and unemployment.<\/p>\n","protected":false},"excerpt":{"rendered":"
As an ideology, modern liberalism is associated with the center of the economic and spectrum because it allows for elements from both socialist ideologies and capitalist ideologies, combined with individual rights and freedoms and the principle of rule of law. This article details the main principles, history, positives and negatives of modern liberalism.<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"iawp_total_views":6,"footnotes":""},"categories":[111,49,50,32,108,11],"tags":[129,62,63,66,15,107,17,113],"class_list":["post-3983","post","type-post","status-publish","format-standard","hentry","category-liberalism","category-economics","category-government","category-great-depression","category-human-rights","category-industrial-revolution","tag-democracy","tag-economics","tag-government","tag-great-depression","tag-history","tag-human-rights","tag-industrial-revolution","tag-liberalism"],"_links":{"self":[{"href":"https:\/\/crunchlearning.com\/website_ec2cbfb0\/wp-json\/wp\/v2\/posts\/3983","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/crunchlearning.com\/website_ec2cbfb0\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/crunchlearning.com\/website_ec2cbfb0\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/crunchlearning.com\/website_ec2cbfb0\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/crunchlearning.com\/website_ec2cbfb0\/wp-json\/wp\/v2\/comments?post=3983"}],"version-history":[{"count":2,"href":"https:\/\/crunchlearning.com\/website_ec2cbfb0\/wp-json\/wp\/v2\/posts\/3983\/revisions"}],"predecessor-version":[{"id":3986,"href":"https:\/\/crunchlearning.com\/website_ec2cbfb0\/wp-json\/wp\/v2\/posts\/3983\/revisions\/3986"}],"wp:attachment":[{"href":"https:\/\/crunchlearning.com\/website_ec2cbfb0\/wp-json\/wp\/v2\/media?parent=3983"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/crunchlearning.com\/website_ec2cbfb0\/wp-json\/wp\/v2\/categories?post=3983"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/crunchlearning.com\/website_ec2cbfb0\/wp-json\/wp\/v2\/tags?post=3983"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}