Basic Characteristics of the Liberal Tradition in the United States and of State-

The economic system in both the United States and the European Union is capitalism, an arrangement characterised by the exchange of goods and services with the intent of gaining profit. Using Max Weber’s definition, capitalism is “the pursuit of profit, and forever renewed profit, by means of continuous, rational, capitalistic enterprise” (17).

Depending on various characteristics, importantly the role the state plays in the society, capitalism can appear in different forms. Whereas the Anglo-Saxon world (especially the United States) can be considered to foster liberal market economy, relying on competitive relationships and transactions on the impersonal free market, following the Second World War, Central and Northern European countries have been referred to as state-coordinated economies, with the state playing a more active role in mediating the economic functioning of the society. It should be noted that European countries are not uniform in their approach, with the Anglo-Saxon Ireland and the United Kingdom exhibiting more liberal tendencies than other West European countries. Also, liberal tendencies have been strengthening in more recent times throughout the continent (as pointed out by e.g. Lipset in “Still the Exceptional Nation?”).

While Europe has embraced numerous ideas connected to the socialist movement, the US remains markedly liberal in its approach. Indeed, Cheryl Greenberg has indicated that

“our [American] society has been liberal by consensus; there was no other American political tradition,” and traces the liberality back to “the absence of a feudal or aristocratic system, the hardiness of our [American] small producers and yeoman farmers, the proliferation of voluntary societies, the openness of our [American] frontier, our [American] rag-to-riches meritocracy, and our [American] melting pot pluralism”

(Sitkoff 66) – thus to cultural and historical factors. John Micklethwait and Adrian Wooldridge further note the “differing underlying values, many of which date back centuries,” to be part and parcel of “American Exceptionalism” and state that “America’s default position on most subjects is somewhat to the right of the default positions of other rich countries,” including and especially to the right of the West European nations, with even American left-wingers sounding right-wing to European ears (291). Similarly, Luigi Barzini states that “Americans, whether they know it or not, are eighteenth-century philosophers at heart” (225), and Jean Baudrillard remarks that “in their collective consciousness they [Americans] are closer to the models of thought of the eighteenth century, which are utopian and pragmatic, than to those that were imposed by the French

Revolution, which were ideological and revolutionary” (“America” 90). The 19^th century ideas connected to Marx and socialism had a negligent impact in the United States, compared to the impact they effected in Europe, and the United States has continued on its course of liberalism.

A key feature of the American brand of capitalism lies in the influence of laissez-faire philosophy of letting the market take its course without the government intervening much. John Kenneth Galbraith sums up laissez-faire as the “belief that economic life has within itself the capacity to solve its own problems and for all to work out the best in the end” (79) referring to the attitudes prevalent among the so-called ‘contented majority’

among Americans, who believe that “government intervention, specifically government regulation, is unnecessary and normally damaging to the beneficent processes of nature”

(82). Corresponding with the value placed on individualism and the antistatist bent prevalent in the United States, the market is seen as the best guarantor of unbiased freedom and equality to act for each individual. The state is necessary for maintaining the legal framework for the providers of services and products to operate in, and state institutions are not seen as patrons of social equality in charge of a support system that would protect individuals against possible inequalities emanating from the marketplace.

According to Zeitlin, liberal market economies are characterized by strategies such as

“deregulation, privatization and welfare retrenchment” (11), meaning that Americans remain suspicious of big government and the prevailing ideology encourages individuals to be left to their own devices as regards their welfare and security.

The American anti-statist mentality can be seen as different from the West European reliance on the government to regulate economic life and provide security to its citizens.

Beck has pointed out that “The central task of the state in Europe – the closing of inequalities due to the unfettered market represents a principle exactly opposite to Isaiah Berlin’s classical definition of the American concept of liberty ‘freedom from state interference’ and ‘freedom to do our own thing”’ (112) – Americans are considered to value their freedom and oppose the state to have too much control over their lives or too big an influence in the community life. Correspondingly, Micklethwait and Wooldridge affirm that for (conservative) Americans “power rests first with individuals, then with local communities and then with states; the federal government comes last in pecking order” (304) showing the potential harmfulness of government agency, particularly on the level of federal govenrment. Timothy Garton Ash further points out that “Americans in aggregate think it more important that the government should leave them free to pursue their own goals, whereas Europeans think it more important that governments should guarantee that no one is in need” (74). The difference is illustrated on the example of France by the comments of Nadeau and Barlow, who have observed that “social rights are as important to the French, as individual liberties are to Americans” (248), “the French are blunt in affirming the role of the state, whereas other countries understate it,”

“Americans who value community life and civil society have always underplayed the role of their government and championed their business-sector” (275), and “in the Anglo-Saxon value system, the state is like a backup. […] It’s the skeleton of French society”

(126). Ferrera and Hemerijck further contend that “one of the most distinctive elements of the European welfare state [italics original] has been its public nature: the responsibility for ensuring social solidarity & cohesion lies with the government – ultimately national (i.e. central government)” and “public funds, public schemes and

public bureaucracies have traditionally been the main pillars of the welfare edifice” (93) demonstrating the commonplace West European thought pattern diametrically opposing antistatism. Americans and West Europeans thus view state activity differently and their considering the state as either unnecessary or beneficial doubtless has ramifications on a number of important areas in those societies.

West European states tend to be more community-oriented, looking out for the wellbeing of the weaker members of society and regulating the system more actively. The North and Central European brand of capitalism or that of coordinated market economies can thus be characterized by a larger public sector and a higher level of public services, stricter regulation of business practices and labour laws, but also by higher taxes than that of the United States. Active European states intend to reduce unfairness in the society, limit poverty as well as foster an overall sense of security in the citizens, or using the words of Delanty and Rumford, “the tradition that is most distinctly European is the aspiration for social justice” that includes “solidarity, welfare state, social care, equality, vision of a fair society” (67). The aim to counter the adverse effects of the market by a safety cushion provided by the state has been referred to as the European social model.

According to Trubek and Mosher the concept of the ‘European social model’ can be summed up as a “three-fold commitment” to “extensive benefits, relative wage and income equality, and coordinated bargaining by organized interest groups” (34). The term may disregard the diversity that exists among West European nations, but denotes the phenomenon of “a desire to maintain protection in those countries that have advanced welfare states and expand it in those that don’t” (ibid).

(Western) Europe seen as an entity can be characterized by its greater orientation towards solidarity, but the approaches of individual states have their individual traits. On the whole, European welfare systems can be divided into four: the Nordic model (of universal welfare coverage funded by high taxation), the Anglo-Saxon model (of more deregulation, means-testing in welfare and higher levels of inequality), the Continental model (of rigid labour-market regulation, high taxation and spending), and the Mediterranean model (similar to the Continental model but with greater emphasis on state pensions) (Ferrera and Hemerijck 94-119), each system showing a different approach towards achieving a more just society. Though the European welfare states are currently (or at least were up to the present crisis) undergoing change as a result of aging population, tensions related to immigration, the spread of neoliberal ideology and criticism as to the high costs of maintaining social programmes, Timothy Garton Ash asserts that “the legacy of Europe’s labour movements and its Christian-Social tradition is an ethos of solidarity, an insistent demand for ‘social justice’ against ‘an individualist performance ethos which accepts crass social inequalities’” (55), and that differences prevalent in the European mentality prevent Europe from becoming too similar to the liberal economy of the United States. Göran Therborn further contends that

“economically, its [Europe’s] overriding concern is stability, not competitiveness or growth (Gowan and Anderson 373)”, demonstrating the creation of a secure, liveable, supportive environment to be the common goal of the West European brand of socially aware economy characterised by attention to social protection, solidarity, worker rights, poverty alleviation and prevention, redistribution of wealth, improvement of living conditions, public healthcare, education programmes, old-age pensions and other benefits.