Tuesday, 1 May 2012

Can Europe return to its glorious liberal past?

The dream of a liberal society, respectful of freedom and individuals is, unfortunately, becoming more and more uncertain every day. However, the wishful answer to the question of whether Europe can become again a liberal society as it was in the past, is that yes, it can. Sadly, the only certainty is that it will take us a long time to get there and the road ahead is a mine-field full of uncertainties and difficulties. The change, if it happens, will most likely be a slow and stealthy, almost unnoticed, transformation and will require at least two more generations as a best estimate. There are of course, potential accelerators such us revolutions, wars or other calamities which may well trigger a faster change and a rethinking of the world we live in, however, History teaches us that most changes take long time even if, when we study them, specific events are recognised as speeding up the adjustment. 

Since the middle of last century, Europe has been the witness of the entrenchment of a social welfare economy and mentality which will take some time to disappear and give way to a more liberal system of managing countries and their economy. Since the big wars, social security systems and big governments were implemented across Europe and the trend continues to be “bigger” governments instead of leaner ones. However, the crucial problem lays in the very minds of individuals, their past and their culture.

The generation of individuals who grew up in these “social” states were provided with free education, free health system, job security, unemployment benefits and many other, apparently free, gifts which they saw as the achievement of a long-awaited aspiration by their parents and grandparents. Their offspring were born in a world were most countries (bar couple of sporadic reactions to unsustainable models such as those led by Lady Thatcher or Ronald Reagan) were accustomed to certain living standards that were no longer negotiable and did not want to give up at any costs. Not even a catastrophic event such as the financial crisis that started in 2008, and which is a clear proof that the model is broken, has been enough to awaken that second generation, now mostly in their late 30’s and 40’s. Similarly to drugs, social welfare systems have hooked millions of individuals and has consequently allowed the entrenchment of governments which are willing to keep the patient sedated in order to maintain their power and own privileges. However, Europe is running out of this drug and very soon the next generation will begin to wake up to an uncomfortable hangover. I cannot read the future, but it is not a wild guess to imagine that this generation will feel the “cold turkey” in its crudest form and the reactions are absolutely unpredictable. Certainly they will be upset and will fight back to recover their parents’ benefits and living standards, but the reality (i.e. unsustainability) will render them to find new ways and innovate, as humans have been doing for centuries. Slowly, they will learn to survive on their own, and so will do their children. And this is the time when liberalism can triumph again.

At some point in the near future, upcoming generations will need to make a choice: to return to the “granny state” (whereby slowly and painfully Europe will decline and die while being overtaken by developing countries) or to embrace a completely different system by which individuals re-invent themselves and are reborn as a different thriving country and economy. No one knows what that system will be and the former option seems more likely to this pessimistic author, but if the seeds are correctly planted now, the chances for a more liberal world with smaller governments may increase. As Hayek put it, “we must make the building of a free society once more an intellectual adventure, a deed of courage. Unless we can make the philosophic foundations of a free society once more a living intellectual issue, and its implementation a task which challenges the ingenuity and imagination of our liveliest minds, the prospects of freedom are indeed dark. But if we can regain that belief in power of ideas which was the mark of liberalism at its best, the battle is not lost.”

On the bright side, we are witnessing changes in the political, social and economical landscape. The rise of political parties on the right and left of the established centre are a living proof of movements in the tectonic plates of the society. The strong comeback of liberal voices like Hayek and the Austrian School are also a good sign, as is the fury and rage against politicians and governments that in a diffused way permeates many different layers of society.

On the dark side though, we can foresee how politicians will manage to maintain their “status quo” and even expand their powers. As Hayek irrefutably said, “’Emergencies’ have always been the pretext on which the safeguards of individual liberty have been eroded.” Governments can still manage to muddle through and provide individuals with a softer drug enough to debilitate their will and keep them calm until the good times return.

Almost 70 years ago, in his masterpiece “The Road to Serfdom”, Hayek said that “the first need is to free ourselves of that worst form of contemporary obscurantism which tries to persuade us that what we have done in the recent past was all either wise or unavoidable. We shall not grow wiser before we learn that much that we have done was very foolish. If in the first attempt to create a world of free men we have failed, we must try again. The guiding principle that a policy of freedom for the individual is the only truly progressive policy remains as true today as it was in the nineteenth century.” This remains as true today as it was in his time.

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