May 27, 2020

Now, More Than Ever, Classical Liberals Must Fight To Uphold the Open Society

The historical lessons of the Mont Pelerin Society provide the path to save the liberal order
Dalibor Rohac

This article is part of a series titled "Liberalism After Coronavirus." The purpose of the series is to give different authors an opportunity to explore the future of liberal values through the lens of the pandemic. 

Whenever classical liberals feel despondent about the present moment, they ought to remember the circumstances surrounding the creation of the Mont Pelerin Society, which helped give birth to the contemporary version of their intellectual movement. When in 1947 Friedrich Hayek invited three dozen scholars to a hotel in Switzerland near Mont Pèlerin to discuss the future of liberalism, a large part of Europe was under Soviet domination and America’s commitment to the security of Western Europe was far from certain. Meanwhile, the drafting of the Marshall Plan was still months away, and it was very much an open question whether liberal democracy would take root in Germany after the experience of Nazism.

There are two lessons from the early days of the movement. First, a sense of perspective and proportion is necessary to evaluate the threats the free world faces at the present. Second, questions of the international economic order and geopolitics ought to be at the heart of classical liberals’ efforts to preserve and strengthen the foundations of a free society.

The COVID-19 pandemic has given rise to sweeping predictions of deglobalization and an end to the neoliberal consensus of the past decades. “Don’t expect a quick return to a carefree world of unfettered movement and free trade,” warns The Economist. “This is not a temporary rupture in an otherwise stable equilibrium,” writes John Gray in the New Statesman.

Indeed, the Overton window of politically acceptable policies has shifted. Sen. Josh Hawley (R-Mo.) wants the United States to leave the World Trade Organization; there is talk of repatriating supply chains; and some even argue for an economic decoupling from China. In the European Union, the pandemic has meant an end, at least temporarily, to the Schengen Area of passport-free travel, threatening the EU’s founding principle of free movement.

However, this is not a time to despair. Most of us want to go back to the 21st century world with all its amenities as soon as the virus abates. Notwithstanding the calls to rethink our way of life, few desire to remain trapped in the present dystopia, where one’s ability to travel or do business across borders is dramatically restricted. The experience of the Great Depression is also a reminder that the recovery from the extraordinary economic shock of the pandemic will be slower if crude protectionism makes a comeback into the repertoire of policy tools used by Western democracies.

Yet, there are few constituencies advocating for a radical upending of existing international arrangements. Before the pandemic, the number of Americans supporting free trade had been steadily growing, with 4 in 5 seeing it as an opportunity, according to a Gallup Poll. Sen. Bernie Sanders (I-Vt.), whose economic platform departed the most radically from conventional wisdom, saw his bid for the Democratic presidential nomination fizzle. President Trump’s nativism and protectionism might get him reelected, but the long-term prospects of such politics look bleak in light of demographic trends such as urbanization and the growing diversity of the US population—as already noted in the GOP “autopsy” that followed the 2012 election.

Moreover, in spite of efforts to build a national conservative movement in the United States, borrowing from the ideological playbook of European nationalist leaders such as Viktor Orbán of Hungary, we have yet to see these efforts produce a compelling policy agenda and not just a set of ill-thought-out impulses. And unlike in the 1930s and 1940s, which were marked by the dual threat of Soviet communism and German Nazism, the West’s main authoritarian challengers today—China and Russia—do not seem to offer an exportable model of social organization.

As a result, the West is not facing the kind of threat from totalitarian regimes and their ideologies that loomed when the Mont Pelerin Society first met. The biggest risk today is not the appeal of new, seemingly exciting ideas—protectionism and nativism are as stale and unimaginative as it gets. The danger is not Russian or Chinese tanks rolling over Western capitals, either.

Rather, the threat we confront is the temptation to give up on the very ideas that made the West successful in the first place. Disinformation and the co-opting of political elites by foreign authoritarians thrive in an atmosphere of nihilism and unreality. The point is not to convince anybody of anything in particular. It is to create an environment in which “nothing is true and everything is possible,” as the title of Peter Pomerantzev’s prescient book on Russian propaganda puts it.

While this atmosphere of unreality changes somewhat the role that classical liberal (or neoliberal) intellectuals ought to play, it does not make the role any less important. It should also focus people’s minds on what truly matters. While questions of domestic policy, including the fiscal size of government, marginal tax rates, and the regulatory state are still relevant, they do not come anywhere near the imperative of keeping the global economy integrated.

The centrality of an intact global market is something the first generation of Mont Pelerin Society intellectuals understood well, for reasons that go far beyond narrow economic ones. The economists, philosophers, and others who accepted Hayek’s invitation focused overwhelmingly on international questions, including the German problem and the post-war reconstruction of Europe. In addition to Hayek, Lionel Robbins, Wilhelm Röpke, Luigi Einaudi, and even Ludwig von Mises all advocated international federalism as a way of constraining the destructive power of nation-states, with a particular emphasis on Europe. While the European project has been a product of many compromises, it reflects discernible classical liberal influences, with the single market, pioneered by the UK government in the 1980s, being the most prominent example.

Rather than accepting the supposedly inevitable end of globalization, it is time for classical liberals to regain relevance in the debates over the future of the international economic order. That does not mean embracing an uncritical view of the status quo. There are gray areas, such as the resilience of our global supply chains in sectors that are critical for security or public health purposes, including in defense industries, pharmaceuticals, and telecommunications. There are also legitimate debates to be had about multilateral organizations, which often treat autocracies as responsible stakeholders in the international economic order. The role of the World Health Organization in the current pandemic illustrates the weakness of that approach. But ensuring that autocrats don’t write the rules for the global economy requires free societies to work closely together and not disengage.

To be effective advocates for an open, globalized world, classical liberals need a more sophisticated understanding of the international order—which seems to have been lost since the time of the Mont Pelerin Society’s founding. It is, for example, delusional to think that bilateral trade agreements, which Trump advocates, can ever work as an alternative to a global trade regime of nondiscrimination, created through decades of multilateral efforts. More broadly, effectiveness requires recognizing the vital role of multilateral institutions in the international arena, which is alien to the crude neorealist mindset that dominates thinking on foreign policy in classical liberal circles in the United States.

Most importantly, successfully upholding the liberal order requires accepting that defending the open society is a long game. But it is one in which quiescence is not an option—and neither is the idea of “capitalism in one country,” which lies at the heart of the bargain that some free marketeers struck with the nationalist right. As Vincent Ostrom put it after the fall of the Iron Curtain, “The world cannot remain half free and half servitude. Each is a threat to the other.” The classical liberal movement has to relearn that lesson.

Dalibor Roháč is a resident scholar at the American Enterprise Institute in Washington, DC and author of In Defense of Globalism (Rowman and Littlefield, 2019). Twitter: @DaliborRohac.

Photo credit: FABRICE COFFRINI/AFP via Getty Images

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