Will Liberalism Prevail?

If liberalism is to prevail in the West, what needs to happen?

History did not “end” in 1991 with the dissolution of the USSR and the victory of the liberal democratic West. After a brief ascendancy, based on a fleeting US hegemony, liberalism once again faces existential challenges from:

  • Populism—both from the right (e.g., Trumpism) and from the left (e.g., “wokeism”) and
  • Illiberal governance models, notably China’s, which claim to deliver better performance than those of the decadent West.

In most Western countries and particularly in the United States, there is a growing sentiment that society is a mess and liberalism, in one way or another, bears much of the blame. This raises several questions:

  1. What are the root causes of the contemporary challenge to liberalism? This is certainly not its first challenge, as two World Wars, the Great Depression, and a Cold War demonstrate. Why now?
  2. What are the implications of the challenge, particularly for democratic institutions?
  3. If liberalism is to prevail, what needs to happen?

This introductory note addresses the first two questions. The third is for discussion. My comments will focus on the challenge to liberalism in the United States because it is so vividly expressed there, and because what happens in the US is of such great significance for the world and for Canada particularly. 

Defining terms

Liberalism: In a phrase, liberalism is founded on a belief in the primacy of the liberty of the individual. After that the details get messy. Basic components of liberalism as a political philosophy include, for example: government only with the consent of the governed (democracy); onus on those who would restrict individual freedom to provide public justification for such restrictions; equality before the law; and freedom of speech and assembly. Over time, as the liberal economies prospered, while the concentration of wealth and power increased, the locus of concern moved from protecting liberties that fostered “production” to interventions aimed at ensuring its fairer distribution—the welfare state. Today, the word “liberal” is primarily associated with its redistributive aspects, whereas “conservative”, in its economic sense, harkens back to the earlier emphasis on protecting the means of production—the “free” market. (The intellectual case for free markets is usually associated with Adam Smith’s metaphor of the “invisible hand.” Kenneth Arrow and Gerhard Debreu provided a mathematically rigorous demonstration of the optimality of perfectly competitive markets in the early 1950s. Based on idealized assumptions they showed that competition was sufficient to produce a “Pareto optimal” outcome—a situation where no one can be made better off without making someone else worse off. Once more realistic assumptions are introduced, the proof of optimality fails, and certain government interventions can in principle produce better results. This has given rise to an ideological debate—never resolved—as to which interventions actually improve outcomes.) 

In the early 1980s, in the context of weak growth and high inflation (“stagflation”), the liberal pendulum swung back toward an emphasis on production—freer trade, deregulation, privatization, lower taxes, etc.—a system labeled neoliberalism and championed politically by Thatcher and Reagan, and giving rise to an orthodoxy that came to be known as the Washington consensus. Forty years on, with the cracks in neoliberalism exposed, the pendulum is swinging back, but to what destination is uncertain. 

Populism: Populism is a political movement that purports to advance the interests of “ordinary people” against those of the “corrupt elites” and is usually characterized by populists as a struggle between good and evil. As such, the stakes are high, so the niceties of fair play can receive short shrift. Populist movements arise out of a sense of grievance and are usually given voice by charismatic and/or demagogic leaders. Right-wing populists appeal to nationalistic, nativist sentiment and typically demonize the “other”—whether foreigners and immigrants, or domestic groups that can be identified and blamed as the source of grievance. Donald Trump is a classic example. Left-wing populists have typically focused on the economic consequences of the shadowy elite power structure and seek to mitigate its influence while also emphasizing the economic and political rights of marginalized groups that are demonized by right-wing populists. Bernie Sanders is a classic example.

The essence of populism, whether right or left, is a politics of grievance—the virtuous “us” against the corrupt “them”. Compromise is not in the vocabulary.

Wokeism: The term “woke” originated in America’s Black communities in the 1980s and initially signified the need to remain alert (awake) to threat and injustice. Around 2014, it became more broadly associated with the emerging Black Lives Matter movement and has since morphed into a catch-all that signifies one’s profound sensitivity to the full gamut of social justice issues. It has become a sort of shorthand for a collection of movements and attitudes including political correctness, identity politics, JEDI (justice, equity, diversity and inclusion), #MeToo, and—for those who do not conform—cancel culture. Because of some well-publicized excesses that have become fodder for right-wing critics, the term “woke” has become pejorative and thus largely abandoned by its adherents in favour of social justice activism.

I believe that wokeism can be categorized as a contemporary form of left-wing populism in North America (and spreading in the West) with the target of grievance primarily cultural—e.g., systemic racism; various gender-related phobias—rather than strictly economic. In this case, the woke claim the “corrupt elite” are the white, mostly male, component of the population whose beliefs and institutions, whether deliberately or not, are agents of systemic social injustice.

The Nature and Sources of the Populist Challenge to Liberalism

To the extent that populism is an attack on the power structure in a society, and that power structure purports to be liberal, it follows that populism is a challenge to liberalism. But the challenge mounted by contemporary populisms of right and left is more one of means than of purported ends. By seeking greater fairness of opportunity, populists can claim to be promoting individual liberty. The problem is that in confronting an entrenched power structure, the rebel cannot afford to play by the rules that have been set by the incumbent power. It’s David vs. Goliath so one has to find a slingshot. 

In the case of right-wing populism—especially in the US today—the slingshot is the manipulation of voting rights and election rules that Republican legislators are enacting in several States. While purporting to protect democracy, the real objective is to disenfranchise the “other”. Although slogans like “Stop the Steal” are transparently disingenuous, the base supporters of Republican populism are willing to suspend disbelief—and democratic legitimacy—in order to protect their livelihood from the low-wage others at home and abroad; to protect their culture from the non-white (or in Quebec, the non-pure laine) and to protect their social standing and self-respect from the sneering intellectual elite. If this requires delusional conspiracy theories and a war on truth, then so be it.

The result has been a purely reflexive rejection of anything coming from the other side. Vaccination mandates, ironically opposed as a violation of the liberal principle of individual freedom that fails to acknowledge the freedoms of others, are one recent example. The human mind’s gymnastic capabilities have been on stunning display in the aftermath of Trump’s defeat and in the response to COVID.

In the case of contemporary left-wing populism—manifesting as militant social justice activism—the principal weapon is an attack on the “incorrect” thought accused of justifying and perpetuating the subjugation of marginalized and especially racialized groups. Some of the manifestations in the form of the persecution (cancellation) of those who violate the rules may appear to be absurd or cruel and are gross violations of liberal tenets regarding free speech and due process. The proponents have nevertheless been remarkably effective in putting a deep chill on dissent within the ranks of the liberal elite—academia, mainstream media, and corporate and NGO leadership. This is all the more remarkable and alarming since liberal societies rely on academia and the media to provide the arenas for free speech and the contest of ideas. If that function is impeded—as it is in all authoritarian regimes—groupthink results and society is at great risk of going down the wrong path, if not down the drain.

How is it, therefore, that social justice activists (the woke), despite a radical agenda, have managed to virtually squelch dissenting views within polite society? I would suggest a combination of the following four factors, in no particular order: 

  • Underlying the movement, quite apart from its tactics, is the justice of its objectives—the liberal advancement of the rights of the marginalized and otherwise disadvantaged. The present manifestation can be seen as the latest stage in an evolution from the end of slavery, to universal suffrage, to gay rights. None came without radical struggle.
  • Academia and influential mainstream media like the New York Times, the Washington Post and CNN are already overwhelmingly sympathetic to the social justice agenda, if not its hyper-aggressive tactics. In the bitterly polarized US political climate, not being seen as woke risks being regarded as sympathetic to Trump. The middle has disappeared.
  • While only a small percentage of university faculty and students are militantly woke, they are a deeply committed and energetic cadre and very effective in using social media to mobilize support and to punish deviance. In the metaphor of David versus Goliath, social media provides the slingshot.
  • Others—the less militant students and faculty—fall in line out of shame, or fear, or ambition, or simply indifference. Meanwhile, university administrators and corporate and NGO leaders go along to avoid either controversy or alienating their young employees who are often social justice advocates themselves.

The Crisis of Contemporary Liberalism: The question as to why the challenge to the prevailing liberal order has become virulent in the past 5-10 years has been the subject of a great deal of commentary, particularly in the wake of Trump, Brexit, and democratic backsliding in Eastern Europe, Turkey, and elsewhere. I believe that in addition to the many specific, local causes—e.g., the particular legacy of racism in the US and of Indigenous dispossession in Canada—four widely acknowledged systemic factors have coalesced to create a tipping point:

  • Technology, liberalized trade, and the emergence of new industrial powerhouses—notably China— have eliminated millions of the jobs that once provided middle class incomes for workers without college education—a situation exacerbated by neoliberal policies that undercut blue-collar unionization. Outside the US, stronger social safety nets have mitigated the consequences and somewhat muted the populist backlash.
  • Income and wealth inequality has increased to levels last seen in the Gilded Age—especially in the US and the other anglosphere countries (i.e., those that most thoroughly embraced neoliberalism). This is seen as stark evidence that the economic deck is stacked in favour of the few and gives credence to a core populist presumption. At the same time, the protracted slowdown in economic growth in the West, punctuated by the Great Recession in 2008, exposed the folly of trusting too much in the neoliberal free market as the most efficient allocator of resources while not providing, in the case of the US, an adequate social safety net to cushion the fallout that neoliberal policies can create.
  • Regional wars and economic misery have meanwhile put increasing pressure from migrants and refugees on the borders of most rich countries, straining settlement capacity and generating a nativist backlash that right-wing populists exploit.
  • Finally, China has emerged as a superpower. As the West has struggled to maintain economic growth and political consensus in the face of the foregoing developments, China illustrates an alternative, illiberal approach to that of a weakening West.

Will Liberalism Prevail?

The pessimist in me would fear that politics in the West—and especially in the US—has demonstrated little capacity for creativity to confront the foregoing constellation of challenges. Neoliberal market capitalism may have been found wanting but, apart from technical tinkering around the edges, the liberal establishment has not attempted any serious fundamental reforms. Then again, perhaps there is no feasible better alternative given the cultural and political constraints prevailing in Western democracies, and particularly in the US? Where is moral leadership to be found? The dominant response of the liberal elite—what Richard Florida has dubbed the creative class—has been to wall themselves up in affluent urban enclaves while ensuring that their children are given the opportunity to follow in their privileged footsteps. Ironically, some of those children are in the vanguard of the radical movements to achieve social justice and to combat climate change. But will enough of their activist impulses survive into adulthood? Meanwhile, the liberal elite only makes itself a bigger target for the populist insurgents from the right, and now also from the left.

The populist response is pure outrage. In the best case this can arouse widespread awareness of an injustice and thus prepare the political ground for reform. The BLM and Truth and Reconciliation movements in the US and Canada are cases in point.

The trouble is that it’s much easier to stoke outrage than it is to design practical and effective solutions. At some point, for example, the dominant narrative around justice for Indigenous peoples must shift from the injustices of the past to a viable course for the future. There are no easy answers.

I believe that by far the most dangerous consequence of contemporary populism on the left and right is a resulting (negative affect) polarization that makes it difficult or impossible to craft the compromises on which liberal democracy depends. Right-wing populists have fomented polarization as a tactic. The greatest threat arising from today’s left-wing populists—the militant social justice activists—is less their intolerance of dissenting views, annoying as that is, but more their uncompromising “moral superiority” which plays directly into the right-wing polarization tactic. Woke culture enrages those—often of leftish liberal sympathy—who disagree, or feel disrespected and unjustly accused. Too many “independent” voters then become vulnerable to the siren song of right-wing populism or to quixotic attempts to form third centrist parties that only divide the progressive vote. For a second time, Donald Trump, or someone like him, could then end up as President of what is still the world’s number one power. Clearly, that would be the greatest catastrophe for liberalism. 

The optimist in me would nevertheless be justified in believing that the West—and especially the United States—will find a way through the challenges I have outlined. After all, the liberal democracies have survived wars, depressions, and political crises galore, and yet managed to summon the inner resources to prevail for well over 100 years. We may not be able to clearly see the way forward, but the diversity of liberal societies is sufficient, we hope, to create the route.

About the Author

Peter NicholsonPeter Nicholson was educated in physics (BSc, MSc, Dalhousie University)and mathematics (PhD, Stanford). He has served in numerous posts in government, business, science, and higher education. His public service career included positions as Deputy Chief of Staff, Policy in the Office of the Prime Minister of Canada and as Special Advisor to the Secretary-general of the OECD in Paris. Dr. Nicholson's business career has included senior executive positions with Scotiabank in Toronto and telecom holding company, BCE Inc. in Montreal. He retired in 2010 as founding president of the Council of Canadian Academies. He is currently the Chair of the Board of the Canadian Institute for Climate Choices. Dr. Nicholson is a Member of the Order of Canada and the Order of Nova Scotia and is the recipient of five Honorary Degrees.  

MAX Policy

Max Policy is a collection of provocative ideas and policy solutions generated by the minds at the Max Bell School of Public Policy.


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