Why Being a Liberal Doesn’t Mean You Support Capitalism

Matt McManus

October 4th, 2022

“In those days, I had seen little further than the old school of political economists into the possibilities of fundamental improvement in social arrangements. Private property, as now understood, and inheritance, appeared to me, as to them, the dernier mot of legislation: and I looked no further than to mitigating the inequalities consequent on these institutions, by getting rid of primogeniture and entails. The notion that it was possible to go further than this in removing the injustice—for injustice it is, whether admitting of a complete remedy or not—involved in the fact that some are born to riches and the vast majority to poverty, I then reckoned chimerical, and only hoped that by universal education, leading to voluntary restraint on population, the portion of the poor might be made more tolerable. In short, I was a democrat, but not the least a Socialist. We were now much less democrats than I had been, because so long as education continues to be so wretchedly imperfect, we dreaded the ignorance and especially the selfishness and brutality of the mass: but our ideal of ultimate improvement went far beyond Democracy, and would class us decidedly under the general designation of Socialists.”
J.S Mill, Autobiography

For many, being a liberal intrinsically means supporting capitalism. Consequently, this has meant accepting high levels of inequality and precarity. Of course, even hardened supporters like F.A Hayek supported minimal forms of welfarism and were deeply critical of the meritocratic mythologizations typically rolled out in support of market society. Indeed he often framed the conservative yearning for social hierarchies to rank the deserving from the undeserving in terms similar to his critique of the progressive yearning for a society to truck with social justice. Both attempted to impose abstract ideals of deservingness onto a free society, at the cost of both freedom and economic efficiency, beneficial to improving the quality of life for liberal citizens. From the standpoint of supporters of liberal capitalism, all people should obtain equality of basic rights, which includes the right to exchange and work as one wishes. But this does not imply that liberals should aim to create equality of outcomes. To do so would require constitutes what Nozick would call a violation of the results of freely chosen exchanges in favor of the authoritarian imposition of a “patterned” theory of economic justice.

The Liberal Socialism of John Stuart Mill

What complicates this picture is the fact that liberals have long held had deep reservations about the excesses or and sometimes even the legitimacy of capitalism, often rivaling and sometimes even outdoing their socialist peers in their critiques. Startlingly this includes the two mos