Response Of Socialism To Classical Liberalism

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Commanding Heights:
Social Assignment:
1. Response of socialism to Classical liberalism:
Classical liberalism is an ideology that embraces the principles of individualism such as rule of law, individual rights and freedoms, private property, economic freedom, self-interest, competition. Classical liberalism stresses the importance of human rationality. Just as it values political freedom, classical liberalism also holds freedom to be the basic standard in economics, and believes the most beneficial economic system to be the free market. Whereas, the term socialism, when generally used refers to any ideology that believes that resources should be controlled by the public for the benefit of everyone in society and not by private interests for the benefit of private owners and investors. From the description of both classical liberalism and socialism provided above it is clear that the two are conflicting ideologies where one supports individualism the other supports collectivism that believes in the wellbeing of all citizens in a community.

2. Franklin D. Roosevelt, president of the united states from 1933 to 1945 (and the distant cousin of Theodore Roosevelt), was the first to convert to Keynes’s theories. He implemented massive public works programs to put people to work. Called the “New Deal”, an echo of Theodore Roosevelt’s square deal, it consisted of a series of programs from 1933 to 1938. As well as providing employment through massive works projects such as the Tennessee valley authority, which built dams to generate electricity. New deal programs provided emergency relief, reformed the banking system, and tried to invigorate agriculture and the economy. Many other programs were also put into place with were used to attemp...

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...h he had favored central banking for most of his life, in 1970 he had begun advocating denationalizing money. In his opinion private enterprise’s that issued distinct currencies, he argued, would have an incentive to maintain their currency’s purchasing power. Which would then mean that customers could choose among competing currencies. Now, whether they would revert to a gold standard or not was a question that Hayek was too much of a believer in spontaneous order to predict. With the collapse of communism in Eastern Europe at the time, some economic consultants had considered Hayek’s currency system as a replacement for fixed-rate currencies.

Even at the age of 89, Hayek was still publishing. In his book The Fatal Conceit, he laid out some profound insights to explain the intellectual’s attraction to socialism and then chose to refute the basis for their beliefs.

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