Clay Risen has a perceptive article in Slate today, warning non-German observers that Angela Merkel (Gerd Schr?der’s likely successor) is no Margaret Thatcher. But embedded in that article is this astounding sentence:
[T]he CDU … is actually an alliance between the more free-market-oriented Christian Democrats, from which Merkel hails, and the more economically liberal Bavarian Christian Social Union. [Emph. added.]
Would these two terms be viewed as opposites anyplace else than America? In any other country, would the term ‘economically liberal’, as applied to the CSU, make any sense at all? (For the thing about the CSU is that it is more culturally conservative and less economically liberal than its sister party.)
Which does not detract, of course, from what Risen hints at: ‘economic liberalism’ is a relative concept. If the Union, even under Merkel, proves more liberal than the SPD, it will be a difference of degree not kind; and I suspect of quite modest degree at that.
Oh, I don’t know. Is your usage anymore valid than the American? It’s more grounded in history, but I don’t think I’d equate liberalism with any particular economic doctrine.
I’ve probably been away from the States too long. When I read the quote I first did a double-take, and it took me about a minute to figure out what it really meant.
Isn’t “economically liberal” an oxymoron, along the lines of “military intelligence”?
@Scott: Isn’t “economically liberal” an oxymoron, along the lines of “military intelligence”?
Only to an American then.
@David: […] I don’t think I’d equate liberalism with any particular economic doctrine
Nor would I, but I do when it has the adjective “economically” in front of it. It took me some time as well before I understood the quote (and then only thanks to the helpful hint in Mrs T’s article title).
@me: when it has the adjective “economically” in front of it
Er.. that would of course be the adverb “economically” or the adjective “economical”. Whatever…
“Is your usage anymore valid than the American?”
American usage is a mess right now.
On economics:
“Conservative” = fiscally reckless, a fan of market-based creative destruction
“Liberal” = protectionist on trade and jobs
On the culture wars:
“Conservative” = overturning the established consensus
“Liberal” = rearguard defence against a cultural insurgency
And on foreign policy:
“Conservative” = transformative democratic radicalism
“Liberal” = stability-focused, rule-based multilateralism
Of course, there are subtleties that I’m obscuring here. One obvious one is that there are plenty of conservative protectionists. And plenty more conservative budget hawks. And plenty of libertarians with no patience for the cultural wars.
In fact the confusion should be another reason why Americans should be careful about how they deploy their labels, especially when they deploy them abroad. To describe anything about the CSU as “liberal” is just wrong.
Scott,
‘economically liberal’ is no oxymoron. Historically, ‘liberal’ meant two things; these two were often found in the same person, but needn’t be. (I should note here that I am shamelessly plagiarising-from-memory Norman Davies’s brief pr?cis of liberalism from his big fat pr?cis of European history, which occupies my free time at the moment.)
Political liberalism was all for limited government with powers clearly set forth in a binding constitution (though plenty of liberals could accept a monarch, so long as he was bound by the constitution); general equality of opportunity (i.e., no special privileges for nobles, clergy etc.); freedom of expression, association etc.; religious tolerance (again, lots of liberals had no problems with an established church as long as dissenters did not suffer disabilities); and so on.
Economic liberalism was all for free trade, free markets, secure property rights and economic freedom generally. So it was against lots of things that aren’t really an issue anymore (e.g., royal monopolies granted to court favourites) as well things that still are (e.g., tariff barriers).
Both political and economic liberalism were big vague boxes of loosely related ideas, and it should not be surprising to find people in the 19th c. who called themselves liberals but didn’t advocate every item in the box. As Davies notes, the line between liberal-leaning conservatives and conservative-leaning liberals was not bright.
The term becomes problematic in our time for two main reasons. First, in many ways we are all liberals now; liberalism (esp. political liberalism) has triumphed in a number of spheres. Bar the extreme fringe, most conservatives today would be political liberals by 19th c. standards; and many of them would be economic liberals as well. (Another, handbag-wielding Mrs. T springs to mind. The tories still have their hangin’-and-floggin’, wogs-begin-at-Calais, Church-and-State contingent. But I think that many tories of the previous century would not recognise their contemporary party brethren as comrades. John Mortimer’s fictional Thatcher-era tory Leslie Titmuss was a loathesome fellow, but in an impassioned speech before his fellow party-insiders espoused some genuine, indeed moving liberal principles.)
Second, the word has undergone a fundamental change in meaning across the Atlantic. There it has come to mean people who (though they might well fit the classical definition of political liberals) are not, by modern American standards, very liberal economically. Americans usually use ‘liberal’ to mean ‘leftist’. Though again, all is relative. American liberals are not really very far to the left; what they espouse is essentially social-democracy-and-water.
If Risen’s description of the Bavarian CSU as ‘economically liberal’ was not simply a lapsus claviaturae, it can only refer to the fact the CSU tend to be less economically liberal than the CDU. That is, they are in some respects closer to the idea of American ‘liberalism’ in that they favour a stronger social safety net. Nowhere in this thread has my theme that all is relative been truer than it is here, though; you’d have to squint awfully hard to confuse Ede Stoiber with Ted Kennedy.
As an American, this comment confused me too. I had to reread the sentence a few times and eventually just assumed it was a typo. However I got the intent, and I suppose it is attempting to use the “American” usage of liberal, and not the traditional one. But I think typically when talking about economics, liberal mostly retains its original meaning, even in the US. However politicians on the left here are accused of wanting to fund programs that will spend money liberally.
But this is all just a difference of terminologies between the US and the Continent. Even continental politicians of the right are known for being what Americans would see as “economically liberal” or at least economically nationalist and unopposed to state intervention. If Merkel does pursue a free-market agenda, and especially if Sarkozy comes in an follows suit, there may be a redefinition of terms along the American lines.
In the US political lexicon, the term “liberal” doesn’t evoke a particular economic political philosophy as it usually does elsewhere in the english speaking universe. A Libertarian in the US is more or less akin to a “liberal” in Europe or Latin America, which can cause a bit of confusion… especially when an American author fails to be clear regarding their intended meaning.
In this sense, Bill Clinton was arguably more of an economic “liberal” than G.W. Bush… Just as JFK was MUCH more economicially liberal than Nixon. But as the two US party’s hire hundreds of consultants to confuse the electorate with various spin doctoring, it’s this, rather than any fundamental difference in our relative understanding of policy positions, that divides our understanding of the terms. Blame us Americans for our muddied and cynical political rhetoric, ok, but don’t imagine we have any monopoly on newspeak weirdness when it comes to economic debates. (The Lib-Dems in the UK spring to mind).
Basically, the Salon author was merely guilty of sloppy use of the adjective, “liberal”. Maybe Risen doesn’t realize that there’s a viable “Liberal” (aka Libertarian) Party in Germany, and thus was more haphazard with the label than he’d have been otherwise?
From my own limited understanding of Merkel’s politics, she strkes me as very much akin to a German version of Thatcher, if one takes the cold war out of the equation. British politics doesn’t have basic “Libertarian” party for historic reasons particular to the UK, so liberal economic policy ends up split between Thatcherite Tories and Blairs New Laborites (who’ve basically continued Thatchers policies themselves).
Obviously Merkel is a smart woman, she’s a physicist, no? And obviously she’s seen the damage statist, anti-market policies cause if left unchecked coming as she does from the East. Yet pragmatically speaking, there’s only so much she can do within the boundries of the German system as it currently exists. Just as there were a series of trade offs that Thatcher had to live with in order to pave the way, so too will Merkel have to horse-trade herself according to the particulars of German politics and political culture.
The lesson, I think, in the analogy is that Merkel will have to choose between her own Parties electoral health in the short term, and all of Germany’s economic health in the long term. Thatcher chose Nation over Party, and the Tories have yet to recover. Will Merkel have the political courage to do the same?
“If Merkel does pursue a free-market agenda”
Politics is the art of the possible. Germany’s economic malaise runs so deep that any incoming government is going to have its work cut out just moving things forward. Three issues are going to be important, reform of the labour market regulations (and tampering with the tax wedge which makes it difficult to employ low-paid unskilled workers), reform of the health and pension systems and reduction in the government deficit.
Proposals are not yet clear but they will be something like changing the marginal tax and ss contribution payments for new entrants to work, containing the spiraling health cost problem, maybe increasing the working age to 67, maybe reforming the pensions system (this will be more difficult for them, given they may have an elderly voting constituency). In order to cut the deficit and finance health she is rumoured to favour raising the consumption tax VAT from the current 16% to 18%.
Schr?der would probably sign up to all this (except the VAT part since this will be anti-growth in its impact). He however is constrained by a part of his party which is in denial about the need to do any of it. So the hope is that Merkel may be more successful in carrying through the reforms, especially in creating a new mood in Germany (I personally am doubtful about this).
Incidentally the FT today has a piece of interest to this discussion:
http://rds.yahoo.com/S=53720272/K=merkel/v=2/SID=e/l=NSR/R=1/SIG=12mbnclur/EXP=1120799401/*-http%3A//news.ft.com/cms/s/a4e0fff4-ee84-11d9-98e5-00000e2511c8.html
this part is worthy of note:
“Angela Merkel, Germany’s opposition leader, indicated yesterday she would reintroduce a capital gains tax for companies that sold stakes in other groups if she was elected chancellor in September.”
“Mrs Merkel also backed calls for tighter controls on hedge funds, arguing that common international regulations were needed. The abolition of the capital gains tax in 2002 by Chancellor Gerhard Schr?der was heralded as one of the most important German tax reforms in decades, as it encouraged banks and insurance companies, in particular, to unravel the tight web of cross-shareholdings among them………….”
“Mrs Merkel’s comments on this tax break, plus those on hedge funds, appeared aimed at deflecting criticism that the CDU wanted to pursue a neo-liberal economic reform course, analysts said.”
Sarkozy, if elected, will probably be very different.
As Scott Crawford notes, ‘liberal’ (sensu nonamericano) is roughly analogous to what Americans understand by ‘libertarian’. But only roughly.
Leaving aside the joking definition of libertarians as ‘Republicans who smoke dope’, American libertarianism strikes me as having a doctrinaire edge to it usually lacking in liberalism. To oversimplify both positions unfairly, a libertarian says, ‘The best allocator of resources is the market. So long as an individual’s actions do not impermissibly injure the rights of another, the state must not interfere with his freedom to act.’ The liberal says, ‘All else being equal, the best allocator of most resources will usually be the market. The state must not interfere with an individual’s right to act absent overriding interests of society as a whole (which the legislator should not be too quick to find exist)’. In more technical terms, your hardcore libertarian says, as your liberal does not, ‘to hell with consequentialism’.
I find it hard to think of Germany’s FDP as libertarian. By tradition they are strongly liberal (both politically and economically), at least by German standards, trying to act as a brake on the Union’s overweening statism, opposing subventions, etc. But they also have the reputation of being what the Germans call a Klientelpartei, a party bent above all else on securing goodies for their core electorate (e.g., affluent professionals and owners of small businesses).
‘Libertarian’ itself presents a transatlantic ambiguity. In its American sense it seems to have caught on in Britain, at least among the Samizdata crowd. Historically, though (at least on the continent) the word has long had radical leftist (though non-Marxist) revolutionary connotations, being associated with anarchist and anarcho-syndicalist movements.