Economy Flashcards
Traditional Conservatives
PRAGMATIC gradual reform over time in order to preserve the fabric of the ORGANIC SOCIETY and that society is an interconnected LIVING ORGANISM. Wish to prevent Revolution and protect TRADITIONAL institutions which represent accumulated wisdom of the past and HIERACHY.
An organic society has to be organised as a hierarchy because people are not equal (e.g. in terms of their ability and work rate). Different jobs are rewarded differently depending on the contribution they make and responsibility people hold.
Rule by the aristocracy was natural since, for generations, the upper class had been raised and educated to govern at all levels in society. As large property holders, they also had a significant stake in society.
The longstanding practice of aristocratic rule was based on paternalism and the concept of noblesse oblige. This meant that those in authority were best placed, and had a duty, to make decisions on behalf of society as a whole.
One Nation Conservatives
Disraeli argued conservatism would have to respond to these social and economic changes by renewing its commitment to reform and social obligation to prevent revolution and class conflict and maintenance of trad institutions of authority. This ties in with idea of ORGANIC SOCIETY and PRAGMATISM. Gradual reform when needed. (Context of industrialisation and rise of laissez-fairs capitalism in 19th C).
• Reforms to improve conditions for the poorest would reduce social discontent, preserve the position of the upper classes
• The most privileged social groups had a moral and PATERNALISTIC duty to help the poor. This included social welfare measures to preserve ‘one nation’, prevent ‘two nations’ from emerging. This is often understood as the idea of NOBLESSE OBLIGE
•Keynesian economics used e.g. by Cons gov 1951-64. to maintain high employment, accepting the mixed economy and supporting the welfare state. Harold Macmillan referred to this One Nation approach as a middle way.
• His classic study, The Middle Way (1938), proposed a ‘halfway house’ between unrestricted capitalism and state socialism, to include public ownership of key industries, government direction of investment and state-funded welfare to establish a minimum standard of living. He argued that a managed economy and orderly capitalism’ would preserve the cohesion of the ‘one nation’ and prevent social unrest.
Areas of agreement
CAPITALISM IS BEST SYSTEM
. the capitalist market system has endured as an efficient, dynamic and productive form of economic organisation. It should be maintained as long as it doesn’t undermine conservative values. TRADITION, PRAGMATISM
• an economy based on capitalism is a more powerful motivator than altruism since humans are self-interested.HUMAN NATURE
Areas of Disagreement
.Level of intervention, mixed economy
Linked to ORGANICISM AND PRESERVATION but differences in how maintained, e.g. through welfare or more authoritarian and through strong authority
New Right
Free market
-The free-market economy is the only mechanism that can meet consumer demand effectively, make maximum use of resources and produce the greatest overall prosperity. Government intervention cannot do this and creates or exacerbates economic problems.
The free market has to be protected against:
• inflation, which discourages economic activity and investment
• industrial or business monopolies, which reduce economic competition and consumer choice (link to cons belief of SELF-INTERESTED human nature and capitalism more powerful motivator than altruism)
• government intervention, which creates inflation by introducing too much money or credit into the economy.
Inflation
-The government’s vital economic role is to tackle inflation. Thatcher and Reagan adopted Friedman’s monetarist policy in the 1980s to reduce inflation by controlling the money supply through cuts in public spending. This neo-liberal approach is generally known as ‘supply side’ economics (see page 38 to read more about libertarianism).
Rejection of government intervention
-State planning, nationalisation and high taxation lead to economic inefficiency and lack of incentive. State welfare provision expands, irrespective of demand, due to the vested interests of the professionals concerned (for example, doctors) and political parties (promising increased welfare spending in elections).
The result is rising taxation and inflation, and increasingly inefficient state welfare services.
Atomistic individualism
-Individuals are rational, self-interested and self-sufficient. Individual freedom can only be safeguarded by opposing collectivism and rolling back’ the state, to release human potential and create natural harmony through free relations.
For example, extensive welfare provision creates a dependency culture that undermines atomistic individualism, institutionalises poverty.
Links to ORGANICISM but much more authoritarian than one nation as believe seeks to strengthen society by reasserting authority and social discipline, rather than through social reform and welfare measures.
Key thinkers:
Trad conservatism:
Edmund Burke in Reflections on the Revolution in France (1780) in which he argued Burke maintained that the ‘true natural aristocracy should govern. These are the people with the ability, experience and inclination to lead the nation wisely in the interest of the whole society. Largely drawn from the hereditary aristocracy.
One-nation:
Disraeli, MacMIllan
Michael Oakeshott: rationalism in politics 1962 argued for pragmatism and political action and thinking should be guided by prag and practical experience to ensure public acceptance and maintain social cohesion and stability and respond to shifting circumstances.
New Right: Nozick in Anarchy, State and Utopia he promotes libertarianism and idea individuals have rights to their lives, liberty and rewards of their labour. Taxes for welfare immoral as taking an individual’s rewards and treating them as a resource.
Ayn Rand in Atlas Shrugged (1957) supported a completely unregulated laissez-fairs economy for freedom and compatible w free expression of human rationality.
Advocates objectivism, idea that rational self-interest is a virtue. This is morally right and based on ‘the virtues of selfishness’.
The Road to Serfdom
Friedrich von Hayek’s (1944) pioneering study was addressed to ‘the socialists of all parties’. It argued that state interventionism and collectivism, even if pursued moderately, would erode individual liberty and create a new form of serfdom or slavery. Free individuals would become dominated by, and dependent on, the state (via welfare provision). Hayek’s study became a key text for supporters of the free market and opponents of Keynesian-style interventionism and state welfare provision, including British conservatives Keith Joseph and Margaret Thatcher.
