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Modern Liberalism

Modern liberalism is a newer form of liberalism and believes in regulating the free market in order to prevent high levels of inequality.

Modern liberalism

Modern liberalism

  • Modern liberalism believes in the power of free-market capitalism to distribute resources in society.
  • However, there may be structural reasons that stop a fair distribution of resources and opportunities.
    • Structural reasons include poverty, unemployment and lack of education.
    • These contribute to an inefficient allocation of resources, and market failure.
  • Therefore, state intervention is acceptable to enable a fair distribution of resources.
    • It is acceptable for the state to intervene to correct market failure.
Example of modern liberalism

Example of modern liberalism

  • ‘New’ liberalism in the early 20th century is one form of modern liberalism.
  • In the UK, modern liberalism has evolved from the 1906 Liberal government up to the present day.
Enabling state

Enabling state

  • Modern liberals support the enabling state.
  • The enabling state is a larger state that provides individuals with the resources that may be necessary to succeed.
  • This kind of state supports individuals, rather than forcing them to be successful.
  • As a result, this kind of state accepts more government intervention in society and in the economy.
    • For example, progressive taxation can be used to raise income for social welfare programs.
Examples of enabling state

Examples of enabling state

  • In the early 20th century the Liberal government introduced graduated income taxes to fund social reforms, such as some healthcare services and social insurance programs.
  • The welfare reforms that took place after the Second World War were heavily influenced by the work of Sir William Beveridge, a Liberal peer.
    • The Beveridge Report outlined ways to support the poorest and worst-off in society and was one of the inspirations for the founding of the National Health Service.
Positive freedom

Positive freedom

  • Modern liberals believe in positive freedom rather than negative freedom where state intervention can ensure freedom.
  • This can be through increasing opportunities for citizens or through policies which reduce poverty in society.
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