This August 3 Wall Street Journal article is based on a Legatum Institute survey comparing Indian and Chinese entrepreneurship and raises important issues about the roles of the state and the family in promoting entrepreneurship.

The common elements between Indian and Chinese wealth-creators are their optimistic view of the future, compared to Americans (“Why I’m Not Hiring”) and Europeans (“Everything’s Fine With Greece, Just Ignore Some Facts”) presumably, and their lack of concern about the impact of the global financial crises on their businesses.

But Indians and Chinese differ widely on why they become entrepreneurs in the first place, where they look for capital, and whether they look to the state to support and encourage them. As the article’s subtitle puts it, “Indians believe they succeed despite the state. The Chinese say they succeed because of it.”

I draw two conclusions from the study: Those who favor freedom, creativity and self-employment seek limited government, while those who seek greater wealth for its own sake are seemingly indifferent about the size and scope of government. And greater trust in the family seems to go along with less trust of the state.

It follows that friends of freedom and the family ought to favor the Indian to the Chinese version of entrepreneurship.

As Kishore Jayabalan noted yesterday, the fallacy of “broken windows” is, unfortunately, ubiquitous in discussions of public finance and macroeconomics. Though we are told that government spending and public works have a stimulating effect on economic activity, rarely are the costs of such projects discussed.

Such is the case with several stimulus projects in my own hometown of Atlanta, GA. The Atlanta Journal-Constitution reports on a list that Sen. John McCain and Sen. Tim Coburn drew up, criticizing wasteful stimulus projects throughout the country:

Their list includes Georgia Tech professors who received federal stimulus funds to understand how jazz, avant-garde art and Indian classical musicians improvise. The report cites an Atlanta Journal-Constitution article that describes the $762,372 study, which involves using brain imaging to learn how musicians do their work.

[....] The senators also highlighted a $677,462 research project at Georgia State University to study “why monkeys respond negatively to inequity and unfairness.” Asked about the project, the university sent the AJC a news release from last year that said the research “will hopefully answer questions about the evolution of responses to reward inequality — including those responses in humans.”

Georgia Tech has fired back:

Georgia Tech issued a statement in response, saying such research is “necessary for the long-term economic success of our state and our nation.”

But how can one verify such claims? As Kishore has pointed out, the mere fact that money is being spent is not enough to claim that the economy benefits from such expenditure. The hidden costs of stimulus money are the jobs and services that would have otherwise been funded by the private sector.

In order to actually determine whether an investment is truly beneficial to the economy, one must be able to subject it to the cost-accounting of profit and loss. A product or service that makes losses has consumed resources that could have otherwise been put to more productive uses in the economy. But since government expenditures are funded not through any kind of voluntary market exchange, but through taxation, this kind of mechanism cannot be used to evaluate them.

So we can be pretty sure that stimulus projects, in fact, are not as conducive to economic growth as we have been led to believe, since such projects would probably not withstand the profit-and-loss test of the market.

But this is not to say that funding any of this kind of scientific research is not worthwhile. Activities such as philanthropy and charitable giving do not produce any kind of profitable return, but are nevertheless recognized as noble and praiseworthy. There may be good reasons for funding these projects, but economic growth is not one of them.

Chinese Communism is no longer about ideology.  Now it is about power.

I reached this conclusion on the basis of six months spent in China and extensive conversations with my Chinese friend and fellow Acton intern Liping, whose analysis has helped me greatly in writing this post.

China began moving away from Communist ideology under Deng Xiaoping, whose economic reforms disassembled communes and created space for private businesses.  He justified these reforms to his Communist colleagues with the saying, “It doesn’t matter if the cat is white or black as long as it catches the mice,” implying that even “capitalist” policies were justified if they succeeded in bringing economic growth.  And they certainly did.  Since that time, China’s economic development has been tremendous, so now Chinese people overwhelmingly approve of the reforms.

Despite the success of the opening of China’s markets, the country has not completely embraced free enterprise.  The PRC’s 60th anniversary celebration last fall featured signs boldly proclaiming, “Socialism is good.”  The government still controls key industries such as oil and runs enterprises in many other industries.

Further, all land in China is owned by the government.  Home buyers are technically only leasing land for 70-year periods, a policy established assuming that by that time, the houses will need to be rebuilt anyway.  The government sometimes sells land inside cities to developers for vastly inflated sums of money, evicting the people who already live there.  The remuneration that these people receive is frequently less than the value of the house, forcing them to find inferior housing elsewhere.  These policies have made housing within cities prohibitively expensive for most Chinese people, forcing them to commute from the suburbs.

Despite these continued regulations, economic freedom in China has made significant advances compared to its previous completely collectivized state.  Enterprise is permitted and even encouraged, as is trade with the outside world.  As people come to recognize the benefits of free markets, more and more are becoming eager to participate, which will make it much more difficult for the government to restrict these freedoms again in the future.

However, this economic freedom does not imply political freedom.  Deng Xiaoping, the same leader who had spearheaded the economic reforms, was responsible for the Tiananmen Square crackdown on protesters for political reform.  That incident twenty years ago is only one of the better-known examples of the political suppression that still occurs today.

The government holds a monopoly on the media, dominates the flow of information, and censors any ideas it finds potentially threatening.  It blocks access to web sites that range from information on tense political issues to social networking sites like Facebook and YouTube.  When I was studying there, during a one-on-one session a teacher asked me what I knew about the Tiananmen Square massacre, admitting that due to censorship I probably knew more about it than she did.  When we had finished the discussion, she erased all relevant vocabulary from the board, saying that she didn’t want anyone to know what we had talked about.  Through the high school level and frequently afterward, students are indoctrinated with Marxist philosophy, and studies of literature are focused exclusively on nationalistic or patriotic themes.  Political dissent is strictly censored, and dissenters are often denied work or restricted from moving or publishing their work.

According to Liping, most new members of the Communist party do not actually believe in Marxism; they just see membership as a way to improve their chances of finding a good job.  Similarly, officials suppress opposing ideas, not because they are persuaded of the truth of Marxism but because they want to prevent dissent and opposition to their own party. Promoting Marxist ideas serves as a way to silence political rivals and to enforce popular support for their own rule.  The first Chinese communists sought power to serve their ideology, but today’s Chinese communists use ideology to preserve their power.

The expansion of economic freedom coupled with the continued political repression may seem like a contradiction, and indeed areas with more trade connections like Shanghai also have more political freedom than government centers like Beijing.  Yet fundamentally, this paradox exists because of the shaky foundation for what freedom they do have.

Deng Xiaoping’s justification for moving away from Communist economic ideology was based solely on pragmatic reasoning.  He figured that since the Communist system was failing miserably, changing economic systems might bring prosperity, a prediction that has been proven true.  Yet abandoning the one-party state did not have any such obvious benefits.  In fact, retaining a monopoly on political power was in the leaders’ personal interest.  They could even argue that it was good for the nation, creating what current president Hu Jintao euphemistically calls a “Harmonious Society” unified by common political beliefs.

In the West, arguments for freedom are closely tied to belief in individual rights which the government cannot legitimately violate.  These beliefs originated in the Christian view that people have special dignity because they are made in the image of God.  This foundation means that even if it would be expedient for the government to restrict freedom, it has no right to do so.  Officials may not always act to preserve the people’s freedom, but in violating freedom, they behave inconsistently with their own ideals.

In contrast, the Chinese Communist Party is consistent in pragmatically following policies that they think will be beneficial, whether they increased freedom or not.  Freedom can bring tremendous practical benefits, which is what one would expect of a concept based on a true vision of human nature.  Yet these practical benefits alone do not constitute freedom’s foundation.  The freedom the government gives pragmatically, it can take away when freedom is no longer practical, or when the benefits it provides are less obvious.

Thus, what China lacks is not merely policies that allow people to act freely but an understanding of the essence and importance of freedom.  Freedom cannot be guaranteed by government pragmatism, but only by a genuine understanding of the rights of the people within the country, coupled with leaders who are willing to restrain their desire for power in order to respect these rights.

Are the Old Continent’s farmers showing that they have a real entrepreneurial spirit and serving as role models of courage and innovation during the Great Recession? Surely not all of them, but there are some inspiring examples to be found in Central and Southern Europe.

This is somewhat surprising as Europe’s agricultural sector is usually among the most traditional, least open to market innovation and product flexibility, and heavily reliant on EU funding to keep the sector competitive. Alas, European leadership in international food trade has been slowly whittled down in the last 3-4 decades.

Some European farmers, however, are resilient and are pulling rabbits out of hats these days by risking and investing heavily to implement creative new forms of business on their farms – many of which had been on the brink of failure.

It is primarily the French and Italians who are showing their true entrepreneurial spirit and vocation to agriculture. They appear to be some of the most tenacious and creative. Just like the Michigan dairy farmer, Brad Morgan, the protagonist of Acton’s documentary The Call of the Entrepreneur, these farmers have turned to undervalued and completely overlooked assets to build lucrative profit-making ventures that often double and triple their old incomes. They have begun reshaping the way their traditional industry operates, and at a time when Europe has lost its competitive edge to cheaper food suppliers from Africa and South America.

Making matters worse has been the total evaporation of their once abundant workforce. In France, for example, rural industry employees currently make up a mere 3% of the nation’s workers, when it once boasted over 40% at the turn of the last century (cf. August 2010 Time article “How to Save Rural France”). And figures for those farmers who have registered as operating “professional” establishments in France’s campagne have dropped from 2,000,000 to 350,000 in the last fifty years. As noted out in a 2006 Acton commentary (“French ‘Security’ and Economic Reality”), this is not at all surprising: the vast majority of France’s youth dream of careers as civil servants, or want to secure life-long union protected contracts, and furthermore claim to generally dislike or distrust free market economics.

A final blow to European farming may come in a few years when the industry’s most heavily relied upon system of public subsidy – the Common Agricultural Policy – is set to undergo reform in 2013. And no one is quite certain what the consequences may be, as EU finance officials nudge the sector to become more competitive and market orientated.

Just what are they doing?


While some major industries in France, like auto manufacturing, have received generous public subsidies to remain competitive, French farmers are beginning to rely on their entrepreneurial spirit and genuine vocation to agriculture to turn their sector around.

They are achieving this by doing exactly what entrepreneurs are called to do: take risks through investment and creatively diversify their business offerings to customers.

For example, entrepreneurial farmers in the southern Ile-de-France grain producing region have utilized the bucolic beauty of their wavy golden fields and soft rolling hillsides to create profit-making ventures. The same beauty that inspired France’s great impressionnistes, now lures thousands of international vacationers to their prime holiday centers built out of once dilapidated grain storage facilities with glorious hill-top views.

It is these same farmers who are using abandoned wheat and barley fields as horse riding tracks. They are converting their dusty old barns into equestrian club houses. Others, like Rabourdin farms in Brie, have added premium beer making facilities to their production portfolios and now attract thousands to their own micro brew facilities and connoisseurs can order their products on-line.

While interviewed for the same Time article, agricultural entrepreneur Bernadette Porchelu said that for her Basque-country farm to succeed “it required a lot of work and investment.”

“But now,” she says, “We are hustling to keep up with the demand and have more than doubled our income. When we first decided to make this move, everyone said we’d fail. Today I wonder how most farms will survive if they don’t undertake similar diversification –which may be why some of our visitors include fellow farmers asking us how we made it work.”

It’s not just the French

One of Italy’s leading agricultural entrepreneurs hailing from Rome, Annibale Gozzi, says that while France is making headlines with its creative agrotourism, Italy is not lagging too far behind.

He says that “neither can Italian farms keep up with fierce international competition in food production…Manual farm labor in other parts of the world is ten times cheaper than in Italy and we simply cannot compete even with our tremendous advances farming methods and technology.”

“We too have been forced to try different things and strive for the full integration of our products, services and assets.”

Those farms that are most successful, like Gozzi’s own agrotourism south of Rome, Villa Germaine, are the ones that have become full-scale “multi-function” operations in addition to producing traditional agriculture.

Referring to his own agriculture establishment as an example, Gozzi says he has risked huge amounts of capital to maximize his farm’s business to include “integrative products and services” such as farming courses, horse riding, premium viticulture and olive oil production, tuffa cave wine and cheese tasting facilities, as well as a full-service hotel and restaurant. His establishment now even regularly hosts business luncheons and wedding receptions with lavish menus featuring his own fresh meat and produce.

He says he does this with dedication and pride, a dream to “do a first-class job for what I love”. Gozzi’s thriving business at Villa Germaine not only has allowed him to maximize his farm’s assets and profits, but truly exemplifies what it means to combine entrepreneurial spirit and tradition all in the same business.

He adds that Italians are catching on to but this type of inventiveness, “but it is still much more appreciated by foreigners and France is clearly leading the way.”

Why they really do it

Vastly increasing revenue has been a driving factor for the survival of European farmers – especially knowing their major public financial support may dramatically change in a few years’ time and as their industry is being swept away by international competition.

Even if Europe’s few remaining die-hards simply had more public financing, it doesn’t mean they would come out on top. It has not worked for decades and surely it does not provide the answer to their future.

Rather, we must follow the lead of those real entrepreneurs who in the toughest economic times are true to their vocation and come up with ingenious solutions to their sector’s woes. If there is a future at all, they are providing viable alternatives. And to do so, they must not only be highly creative. They must also be willing to take risks –a courageous attitude undertaken by those who genuinely live out a vocation and exhibit a real passion for their trade.

(This article is the first of a regular monthly series dedicated to entrepreneurship in Europe.)

A recent New York Times story reports that the new British government plans to “decentralize” the National Health Care system as part of its new austerity measures.

Practical details of the plan are still sketchy. But its aim is clear: to shift control of England’s $160 billion annual health budget from a centralized bureaucracy to doctors at the local level. Under the plan, $100 billion to $125 billion a year would be meted out to general practitioners, who would use the money to buy services from hospitals and other health care providers.

The plan would also shrink the bureaucratic apparatus, in keeping with the government’s goal to effect $30 billion in “efficiency savings” in the health budget by 2014 and to reduce administrative costs by 45 percent. Tens of thousands of jobs would be lost because layers of bureaucracy would be abolished.

[N.B. Note that the plan applies only to England; the other constituent countries of the UK will have to make their own policies]

Though I’m not by any means an expert on British politics, the move strikes me as bold for two reasons: (1) The Conservatives have reversed their original position on not touching the National Health Service, instead opting for a plan that seeks to make unprecedented changes to the system; and (2) according to the NYT”s reporting, the plan is predictably facing intense opposition from government employees that stand to lose their jobs, as $30 billion are saved and 45% of administrative costs are phased out by 2014. In fact, some union members are trying to derail the plan by portraying it as a stepping stone towards privatization.

But what is most pleasant about this whole affair is the precise appeal made to an idea very similar to the Catholic understanding of subsidiarity:

“One of the great attractions of this is that it will be able to focus on what local people need,” said Prof. Steve Field, chairman of the Royal College of General Practitioners, which represents about 40,000 of the 50,000 general practitioners in the country. “This is about clinicians taking responsibility for making these decisions.”

Dr. Richard Vautrey, deputy chairman of the general practitioner committee at the British Medical Association, said general practitioners had long felt there were “far too many bureaucratic hurdles to leap” in the system, impeding communication. “In many places, the communication between G.P.’s and consultants in hospitals has become fragmented and distant,” he said.

Here we once again have the understanding that society should deal with problems on the lowest possible level.

But the winning side in this plan is not just that of the proponents of subsidiarity. Economic theory also suggests that policies guided by sentiments similar to subsidiarity tend to increase prosperity: the $30 billion that the government plans to cut from the budget will now exist in the private sector, where it can be put to more productive uses, in accordance with consumer demand. The civil employees released from their positions in the government do not have to mire in unemployment; instead the money from their state salaries will be used by the private sector to create positions which they can fill.

On the other side of the ocean, the United States moves in the other direction: away from subsidiarity, and towards a “one-size-fits-all” solution to fixing our health care system. The office of Congressman Kevin Brady recently released a diagram prepared by the minority of the Joint Economic Committee. It’s a fully detailed diagram of what the new health care system in the United States will look like once all provisions of the legislation are in effect. Take a look:

Chart Outlining ObamaCare

America's New Health Care System

The current health care system already raises enough questions about whether the principle of subsidiarity is respected. But this newest remake makes the question all the more serious.

In fact, over 37 states have begun to take some form of legal action against the health care legislation on the constitutional grounds that regulations such as the individual mandate overstep the federal government’s legal bounds. As I’ve argued before, the federalism of the Constitution is a rather good embodiment of the principle of subsidiarity, since it recognizes that many issues (even urgent and pressing ones like health care) should be dealt with at the state level.

And some partial victories for advocates of subsidiarity are already making the news: Missouri voters overwhelmingly approved of a ballot initiative opposing the individual mandate (by a landslide ratio of 3 to 1), and a federal judge refused to dismiss a suit by Virginia that challenges the constitutionality of the health care law.

In addition to a national campaign to repeal the legislation at a Congressional level, supporters of subsidiarity would do well to also pay attention to the battles at the state level. I suspect this is where we will see the greatest impact.

Those who love freedom were saddened to learn this morning of the passing of one of the most significant contributors to the cause of liberty and individual responsibility in Latin America, Manuel F. Ayau, affectionately known as “Muso” to his many friends and acquaintances, after a long and brave struggle with cancer.

A humble, self-effacing but determined man, Ayau is a classic example of someone who made a difference. Whereas others confined themselves to talking about the free society, Ayau decided from an early age that he would do whatever he could to create the conditions that promote liberty and therefore the opportunity for authentic human flourishing.

Born in Guatemala City 85 years ago, Ayau undertook his university studies in the United States. An engineer by training, Ayau had one of those intellectually curious minds that are forever seeking to know the truth of things. Hence, alongside a successful career as an entrepreneur, businessman, company director, commercial banker, and member of the Central Bank of Guatemala, Ayau never ceased to be a pioneer in promoting the life of the mind.

In the late 1950s, Ayau founded the Center for Economic and Social Studies (CEES) in Guatemala. Its purpose was simple: to study and develop wider understanding of the preconditions of societies that were both free and prosperous. In the conditions of 1950s Guatemala, most would have viewed such an enterprise as worthy of Don Quixote himself. But to Ayau’s mind, ideas mattered, and unless people were willing to invest in good ideas, then bad ideas would surely prevail.

Eventually his determination to spread the ideas of liberty in his own impoverished, fractured country led Ayau to found what will surely be his most lasting legacy, the Universidad Francisco Marroquín in Guatemala, which today is widely recognized as one of the best universities in Latin America. Named after an early bishop of Guatemala, Francisco Marroquín, this university and its exceptionally talented faculty has educated thousands of young Latin Americans in the foundations of freedom and responsibility, and alerted them to the importance and virtue of always seeking after the truth.

But apart from his institutional achievements, I have often thought that what most characterized Ayau’s work and life was his courage. Not many people would take the risk of creating a private university in a Central American country noted for its instability and poverty. Nor was Ayau afraid to take his ideas directly into the public square. He served, for instance, as a member of Guatemala’s Congress and even stood for president in 1990. Ayau was no stranger to threats, including against his own life, yet he was never intimidated by those who prefer violence to reason. In the face of political pressures that most would find unbearable, Ayau never lost hope in the cause of freedom and its capacity to contribute to the common good of his country.

Ayau’s contributions to the growth of the habits and institutions of liberty in Guatemala are, like most substantive achievements, immeasurable. He did not, however, limit his activities to his own nation. He worked tirelessly for liberty at the international level for decades. As a reflection of the esteem in which others held him, Ayau served a term as President of the Mont Pèlerin Society and was a long time member of the board of directors of the Liberty Fund as well as a trustee of the Foundation for Economic Education—organizations that have all worked tirelessly over many decades in often difficult circumstances to explain and develop the ideas of freedom and the virtues needed to sustain them to several generations of students and scholars.

Much time will pass before Ayau’s full legacy bears all of its fruit, especially in the persons of the many young minds that have passed through Universidad Francisco Marroquín. But in all my conversations with Ayau, I always marveled at his quiet confidence that, no matter how difficult the odds, truth would prevail over error, not least because he believed that human beings were made for freedom—in the fullest and richest sense of that word—rather than slavery and ignorance.

Whenever I think about Ayau, however, I can’t help but recall the first time I read his Inaugural Address presented at the inauguration of the Universidad Francisco Marroquín on January 15, 1972. The 1970s were not a happy decade for freedom. The West was undergoing one of its worst crises of self-confidence, thousands of Latin American intellectuals were becoming convinced that the materialist and collectivist principles of Marxism-Leninism was the future, and universities around the world were increasingly descending into a morass of relativism and a preference for propagating ideology over the pursuit of truth.

Throughout Ayau’s remarks, however, breathes a spirit of optimism, a belief in humanity’s capacity for self-improvement, and an assurance that the light of liberty and truth could never be extinguished. “May God help us and show us the way to the truth”, were the words with which Ayau ended his address. His faith in the workings of Providence never dimmed.

In this moment of sadness, we remember Ayau’s family. They shared his dreams and in their own ways helped him to turn them into reality. But we also honor a man who never hesitated to put his talents and mind at the service of others, many of whom will never know just how much they owe him.

Manuel F. Ayau, requiescat in pace.

Today’s Wall Street Journal has a nice piece about the problem of graffiti in Rome and the obstacles to cleaning it all up.

While the graffiti are certainly an eyesore in an otherwise beautiful city, there is also great economic damage done, which leads to impoverished understandings of private property and general urban decay.

If cleaning up the graffiti on a four-story palazzo can cost as much as €40,000, there are surely people there to profit from the clean-up. And in Rome, there must be whole bureaucracies created to study, discuss and discuss and discuss the problem some more. Perhaps there are too many people making money off this graffiti affair to put an end to it. So maybe we should just get used to the graffiti and consider it all a net-plus to the city economically?

Margherita Stancati/The Wall Street Journal

Not at all. This should remind us of the French economist Frédéric Bastiat’s theory of “what is seen and what is not seen”, also known as his theory of the broken window. (Incidentially, Bastiat is buried in the Roman church of San Luigi dei Francesi and his simple tomb makes a great pilgrimage stop for those who appreciate market economics.)

When crimes against private property are not recognized for what they are and state officials choose to shrug them off, people will grow accustomed to such crimes and even seek economic justifications for them. This in turn leads to more crime and even less respect for private property. Not only is this bad economics, it is immoral and immensely demoralizing to those who care about their common life, i.e. politics in the widest and most important sense of the word. It also explains why Romans seem to care so little about their city, its public as well as its private spaces, and why it seems to take American volunteers to clean up the place. Che vergogna!

I just couldn’t pass this one up.

Below is an ENI story on the installation of 800 “colourful miniature figures of the 16th-century Protestant Reformer Martin Luther” in the market square of Wittenberg.

Just as last year there was a good deal of academic and commercial interest around the 500th anniversary of the birth of John Calvin, you can expect a great deal of activity leading up to the 500th anniversary of the traditional date of the dawn of the Reformation in 1517.

There are some more details on Ottmar Hörl’s installation here and at his personal website.

Martin Luther: Hier stehe ich

Ottmar Hörl, Martin Luther: Hier stehe ich, 2010 (Foto: Christoph Busse/Sven Hoffmann)

Here’s a video of the removal of the original nineteenth-century Luther statue upon which Hörl’s installation is based, in preparation for its restoration.

(more…)

One of the charges sometimes leveled against classical liberal thought is that it opposes all authority; that it seeks to reduce society to an amalgamation of atomized individuals, eliminating the role of religion, community, and vibrant social institutions.

The Place of Religion in the Liberal Philosophy of Constant, Tocqueville, and ActonHistorian Ralph Raico seeks to argue the very opposite in his dissertation, The Place of Religion in the Liberal Philosophy of Constant, Tocqueville, and Lord Acton. The work has been republished for the first time by the Mises Institute. (A particularly interesting note is that the chair of Raico’s dissertation committee was none other than F.A. Hayek).

Raico argues that these classical liberal thinkers did not, by any stretch, subscribe to the secularist views of some of their liberal contemporaries. Instead, they found compelling religious justifications for liberty. Contrary to the assertions of some critics of classical liberalism, they also did not oppose all authority: They recognized the essential value of family, church, and other vibrant and flourishing social institutions. These possess what I would venture to call a “natural authority,” a kind of authority and social standing that naturally arises from the workings of a free society (as distinct from the coercive authority of a government or state). Human beings congregate in these groups precisely because we are social animals, and because we identify these institutions as  conducive to our flourishing.

As Acton University faculty member Jeffrey Tucker notes:

What resources were available that highlighted this alternative liberal tradition? There weren’t many at the time. It was during this period that Ralph Raico went to work on his dissertation. He hit the target with an extended discussion of three massively important figures in the history of liberalism for whom a religious orientation, and an overarching moral framework, was central for their thought: French Protestant Benjamin Constant (1767–1830), French Catholic Alexis de Tocqueville (1805–1859), and Lord Acton (1834–1902).

All three were distinguished for

  1. consistent antistatism,
  2. appreciation for modernity and commerce,
  3. love of liberty and its identification with human rights,
  4. a conviction in favor of social institutions such as churches and cultural norms, and
  5. a belief that liberty is not a moral end in itself but rather a means toward a higher end.

[....] Raico provides a detailed reading of their work in all these respects and shows that one need not embrace statism, and that one can be a consistent and full-blown liberal in the classical tradition [...] Ours is a varied tradition of secularists, yes, but also of deeply pious thinkers. What drew them all together was a conviction that liberty is the mother and not the daughter of order.

As the case for liberty continues to be made, it is important never to neglect this extremely fruitful tradition in classical liberal thought.

Update: I stumbled across a Lord Acton quote that helps illustrate the distinction between the “natural” authority of voluntary institutions in civil society and the authority of the state:

“Authority that does not exist for Liberty is not authority but force.” – Lord Acton

I think that the oppression threatening democracies will not be like anything there has been in the world before….

I see an innumerable crowd of men, all alike and equal, turned in upon themselves in a restless search for those petty, vulgar pleasures with which they fill their souls….

Above these men stands an immense and protective power which alone is responsible for looking after their enjoyments and watching over their destiny. It is absolute, meticulous, ordered, provident, and kindly disposed. It would be like a fatherly authority, if, fatherlike, its aim were to prepare men for manhood, but it seeks only to keep them in perpetual childhood; it prefers its citizens to enjoy themselves provided they have only enjoyment in mind. It works readily for their happiness but it wishes to be the only provider and judge of it. It provides their security, anticipates and guarantees their needs, supplies their pleasures, directs their principal concerns, manages their industry, regulates their estates, divides their inheritances….

Thus, it reduces daily the value and frequency of the exercise of free choice; it restricts the activity of free will within a narrower range and gradually removes autonomy itself from each citizen. Equality has prepared men for all this, inclining them to tolerate all these things and often even to see them as a blessing.

Thus, the ruling power, having taken each citizen one by one into its powerful grasp and having molded him to its own liking, spreads its arms over the whole of society, covering the surface of social life with a network of petty, complicated, detailed, and uniform rules through which even the most original minds and the most energetic of spirits cannot reach the light in order to rise above the crowd. It does not break men’s wills but it does soften, bend, and control them; rarely does it force men to act but it constantly opposes what actions they perform; it does not destroy the start of anything but it stands in its way; it does not tyrannize but it inhibits, represses, drains, snuffs out, dulls so much effort that finally it reduces each nation to nothing more than a flock of timid and hardworking animals with the government as shepherd.

I have always believed that this type of organized, gentle, and peaceful enslavement just described could link up more easily than imagined with some of the external forms of freedom and that it would not be impossible for it to take hold in the very shadow of the sovereignty of this people.

Alexis De Tocqueville, 1840.

Democracy in America, pp. 805-6.