How far was the New Liberalism a Departure from the Old?

The degree to which new Liberalism departed from old (or classical) liberalism
is a complex one to answer. While there is broad agreement on the definitions
and usage of the terms, the degree to which the differences between them
represented a fundamental shift in philosophical and political viewpoint is
unclear. While the emphasis on personal freedom and self-actualisation remained,
increasingly it was argued that a key to ensuring this was governmental help to
help safeguard opportunity rather than a laissez-faire 'nightwatchman' state.
Even the most prominent proponents of new Liberal thinking, however, retained a
greater skepticism towards state intervention and a than was previously thought
to be the case. New Liberalism was also not a synchronic phenomenon, rather a
loose and evolving set of ideas whose proponents developed their thinking over
time, and the descendents of these ideas could be said to have developed into
the more socialist and universal policies of the post-war welfare state. As
such it is arguably impossible to pin down exactly how far new Liberalism
departed from the old, as the path between them and beyond have the continuity
of a rope rather than a single strand.

New Liberalism organically grew from the old Liberalism and retained a
continuity of certain key principles. Both emphasised the importance of
political rights and freedoms, and democratic principles around the importance
of political participation and governance. These were rooted in the British
political and intellectual traditions of political participation and governance
stretching back to Mill, Locke and arguably all the way back to Magna Carta.
The new Liberal Beveridge, for example, in his 'Unemployment (1909)' did not
seek to remove the existence of unemployment through state intervention as the
Soviets tried to in the following decades: 'It is obvious that [...] there must
be insecurity of employment. [...] Unemployment, in other words, is to some
extent at least part of the price of industrial competition'. This emphasises
the continuity between old and new Liberalism in that new Liberalism was more
about improving economic efficency and the worst effects of capitalism rather
than fighting for an abstract ideal of social justice. Similarly
Mill - arguably a prototypical new Liberal - wrote a book 'On Liberty' whose
central concern was how to retain those key principles in the face of the
limitations to freedom that unregulated freedom itself could bring.

In economic philosophy, new Liberalism departed significantly from old
Liberalism by accepting a more interventionist role for the state in economic
affairs. Old Liberal thinkers such as Adam Smith placed great faith in the
ability of markets to allocate resources efficiently for the benefit of all.
This changed with ideas such as the Webbs' notions of the 'national minimum',
which were enthusiastically championed by Beatrice Webb. Arguably, these
arguments reached an apotheosis of new Liberalism in Keynes, whose economics
sought to refine Adam Smith's laissez faire conclusions with anti-cyclical
market regulation by government designed to avoid the worst excesses of the
free market capitalism that Beveridge arged socialism had 'much justificiation'
in critiquing.

Economic philosophy's adjustments to Liberal philosophy went hand-in-hand with
changes to attitudes to social justice. In his 1911 work 'Liberalism', Hobhouse
argued for 'positive freedom', which can be characterised as the enablement of
the individual to be unencumbered by obstacles to their choice of action, and
implied that an outside agency such as government may need to be involved to
ensure these obstacles are not in place. This is contrast to 'negative freedom'
notions in Liberalism, which argued that freedom can be best safeguarded by the
removal of interventions by outside forces, exemplified by old Liberalism's
notions of 'laissez faire' in matters of government.

These arguments for social justice went together with arguments for economic
efficiency. While Beveridge bemoaned the inefficiencies of the free market in
his Unemployment, the Webbs, in their co-produced Minority Report of 1909
stated its aims as: 'to secure a national minimum of civilised life ... open
to all alike, of both sexes and all classes, by which we meant sufficient
nourishment and training when young, a living wage when able-bodied, treatment
when sick, and modest but secure livelihood when disabled or aged'. The degree
to which the Webbs' motives were social justice rather than classical Liberal
philosophies are difficult to disentangle. However, it might be argued that
Sidney Webb's move from an early interest in minimum guarantees of personal
freedom towards a later increasing interest in addressing social and economic
inequalities via collective action was a reflection of how new Liberalism itself
developed into the ideas that underpinned the more socialist welfare state that
was set up after the second world war. Webb himself reflected this evolution in
his work, moving from individual freedom being the focal point of discussion in
The Basis of Socialism (1889) to discussion of the limits of individualism in
The Difficulties of Individualism (1896). For Beveridge, it is easier to trace
this relationship as his theory became concrete practice when he, Churchill and
Lloyd George set up Labour Exchanges in 1909 to ensure the efficient and timely
allocation of work to obviate 'the incalculable changes and irregularities of
economic conditions will still make nearly all men insecure.' (Beveridge,
Unemployment, 1909).

Tensions and continuities between old Liberal ideas of economic efficiencies and
supposedly new Liberal ideas of equality were a common theme of the time. The
Old Age Pensions act in 1908 brought in under Asquith provides some examples of
this. When first drawn up, exclusions were made for various groups who, by their
immoral or 'habitually improvident' behaviour were deemed unworthy by the state.
Collini points this out as an example of where the new Liberalism's differences
from the old have been significantly overstated. In this context, the revelation
that Hobhouse, the principal proponent of 'positive freedom', was content make
the Old Age Pension available 'for all persons of respectable standing'
(Hobhouse, Social Evolution), implies that rather than foreshadowing a purely
socialist ideal of universal living standards, new Liberalism clung relatively
close to older ideas of moral worthiness than previously thought by historians
such as Weiler.

The field of foreign affairs demonstrates again some of the key differences
between old and new Liberalism. Whereas old Liberalism clung firmly to the
notion of state sovereignty and non-intervention in international affairs, new
Liberalism saw a role for more interventionist international insitutions like
the League of Nations. J. A. Hobson, whose 'Imperialism: A Study' (1902)
espoused the view that the pursuit of economic interests by powerful nations
often led to geopolitical tensions and conflicts contrasted firmly with the old
Liberal view of free trade bringing relative prosperity, freedom and peace
espoused by Cobden in his "Manchester Speech" of 1846, showed a great interest
in the formation and structure of the League of Nations in the early 20th
century.

The transition from Old Liberalism to New Liberalism was marked by both
continuity and departure, reflecting the changing socio-economic landscape
and ideological responses to it. While both strands maintained a commitment
to political rights and democratic principles rooted in British traditions,
New Liberalism introduced significant shifts, particularly around the
necessity of state involvement in defending freedoms foreshadowed by Mill's
political philosophies. The embrace of state intervention in economic affairs,
as seen in the works of Beveridge and the evolution of Keynesian economics,
marked a departure from the laissez-faire principles of Old Liberalism.
Similarly, the emphasis on "positive freedom" and the pursuit of social justice
reflected in Hobhouse's writings illustrated a widening of Liberal ideals. The
foreign policy arena further exemplified the distinctions, with New Liberals
advocating for interventionist international institutions like the League of
Nations. To a large extent, these changes can be seen as a continuation of
older Liberal ideals responding to the changes brought by a modern
industrialised and urbanised economy, the response to which was more
small-c conservative, gradualist, and tempered than Marx's more apocalyptic
prognoses.