In the Wall Street Journal’s most recent “Weekend Interview” feature, columnist William McGurn spoke to Professor Patrick Deneen, a political theorist at Notre Dame, about his influential 2018 book Why Liberalism Has Failed. McGurn, himself a Notre Dame graduate, takes Deneen to task for selling the Founders “short” by supposedly exposing their weak moral and social foundations in his book. “Liberalism has failed,” Deneen provocatively claims, “not because it fell short, but because it was true to itself. It has failed because it has succeeded.”

In Deneen’s view basic liberalism necessarily goes astray because it treats the atomistic individual, shorn from his or her social and religious context, solely as a rights-bearing entity. Deneen thus attacks the Framers worldview with its strong protections  of individual rights, free and fair elections, and an independent judiciary.  Writing even before Trump was elected, Deneen argues that it is “evident to all that the political system is broken and social fabric is fraying, particularly as a growing gap between wealthy haves and left-behind have-nots increases, a hostile divide widens between faithful and secular peoples, and deep disagreement persists over America’s role in the world.”

It is one thing, however, to identify a broken social culture; it is quite another to offer a diagnosis and cure for the condition. Deneen does neither. The book’s flap description leads with its chin: “Of the three dominant ideologies of the twentieth century—fascism, communism, and liberalism—only the last remains.” Ridding the world of both fascism and communism will never come soon enough, given that both forms of government necessarily degenerate into police states. The same must be said today of socialism, which produces tyrannies in countries such as Russia, China, Cuba and Venezuela.  Even the worst form of liberalism is far better than these mutant forms of social organization.

Deneen mistakenly lumps together three species of liberalism under a single banner.  Libertarianism, classical liberalism, and the modern progressive variation all have very different properties. The kinship between libertarianism and classical liberalism is clearly the closest.  Both systems put a lot of weight on individual autonomy whereby all people, not just some privileged few, are entitled to set their own course of action so long as they do not by force or fraud interfere with the like liberties of others.  Both systems of thought start with the assumption that property rights over land, chattels, and animals (water remains in the commons for good reasons) are acquired by the ancient principle of occupation, which removes them from their unowned condition in the state of nature. The offices of tort and criminal law then ensure that all individuals must respect the rights that other people have in their own bodies and possessions.

It is, however, a huge mistake to assume that this system creates atomistic egoists whose highest aim in life is to secure their own isolation from the world.  The missing piece of the puzzle is the law of contract, which allows for spot transactions whereby one person buys some good or service from another, at a mutually agreed price.  Most critically, the law of contract also allows individuals to form complex business and social organizations, including religious institutions, universities, charities, reading groups, fraternal societies, and so on—all of which are designed to form the tight intermediate communities situated between the individual and the state that Deneen so desperately wants.

These institutions reached their peak, it should be stressed, during the period of laissez-faire capitalism, and they flourished as coherent units because of their ability to determine their own membership.   It  should never be forgotten that the highest level of social and material advancement, as Robert Gordon has shown in his book The Rise and Fall of American Growth, took place in the years between 1870 and 1940. (Ironically, Gordon failed to draw the tight connection between human flourishing and the laissez-faire constitutionalism of the so-called Lochner era.) Its principle of freedom of contract succeeded then, as it can succeed now, because it rested on a thin, not thick, conception of human beings.  Mr. A, Ms. B., and thousands like them fashioned whatever relationships they wanted with whom they wanted.  Mutual gains, privately defined, for all parties drove (and continue to drive) the engine of progress.

There is, however, one huge difference between the libertarian and the classical liberal. The former relies solely on voluntary organizations to advance the public good, worrying (rightly) about the risk of excessive government intervention.  But the classical liberal adds two other key elements in the mix—taxation and eminent domain—to overcome the intractable holdout problem when the cooperation of all is needed for any one person to prosper.  Taxation provides government with the resources to maintain social order and provide needed infrastructure.  Eminent domain lets government acquire key property for specific uses.  Historically, it also allowed government to impose non-confiscatory rates to limit the monopoly power of common carriers and public utilities, and to develop a sensible antitrust law chiefly to stop cartels from engaging in price fixing or territorial division.

The circumscribed power to initiate forced exchanges allows the state to maintain public waterways to control for the excessive waste that can arise from overfishing and overhunting, to facilitate the creation of intellectual property rights, and much more.  In all these diverse settings, the classical liberal allows, as the libertarian will not, for forced exchanges that benefit the individuals who are subjected to government coercion by the imposition of like restraints on others, or by payment of just compensation. The government is strong enough to rule, but not so strong as to snuff out individual rights and voluntary associations.

To a classical liberal, the role for coercion is sharply limited.  But that is decidedly not the case for modern progressives, who relish the prospect that the state can use its power to tax and regulate to secure massive redistributions of wealth for their favored groups.  To a modern progressive, the state is no longer obliged to prevent the taking of the property of A and giving it to B.  Instead, the raison d’etre of the post-New Deal administrative state is to secure its preferred form of redistribution.  Accordingly, the modern progressive synthesis looks askance at the common law rules of the classical liberal system. All individuals may only defend their rights by participating in a contentious political process that is sure to go awry.  Under the progressive vision, weak property and contract rights lead to widespread deference to expert legislative and administrative bodies on all matters of economic and social allocation.

When property rights are by design made weak and indefinite, an endless array of bruising battles follow at the local, state, and national level. The new law of property uses government decrees to determine which property shall remain vacant and which may be developed and for what use. Modern employment law lets the state upend private labor contracts set in highly efficient competitive markets. In their stead, government bureaucrats can put some individuals under a duty to deal with others on the terms and conditions set by modern labor and antidiscrimination law.

The upshot is that the divide between secular and religious forces that Deneen deplores plays out when the federal government takes it upon itself to mandate, for example, that religious employers must supply contraceptives free of charge to their employees, or when state commissions decree that small bakers must craft wedding cakes for same-sex couples even when it cuts against their religious beliefs.

The great virtue of a competitive market is that it respects the right to refuse to enter these arrangements for good reason, bad reason, or no reason at all. The classical liberal or libertarian state is thus forcibly restrained from fomenting trouble on our most divisive issues, and thus promotes the kind of civil peace that Deneen rightly seeks, by insisting that those who disagree go their separate ways. The U.S. Constitution is mainly a classical liberal document, not a libertarian one. McGurn was right to say that Deneen gives up too quickly on the strongest features of that constitutional design when he dismisses separation of powers, the rule of law, and private property rights in favor of what looks like some woolly communitarian approach.

Indeed, one dangerous consequence of Deneen’s view is that it blinds us as a nation to the insidious threats of liberty throughout the world.  In a recent, column entitled  “Help Is Not on the Way,” Gabriel Schoenfeld despaired that “illiberal conservatives” like Deneen promote intellectual disdain for American institutions, so that Americans become unwillling to assist beleaguered citizens around the world fighting for their rights, like the dissidents in Hong Kong who now face the imminent threat of forced incarceration in China. Whatever the defects of American institutions, they are trivial compared to gaping flaws of China’s systematic tyranny.

© 2019 by the Board of Trustees of Leland Stanford Junior University