From Markets To Speech, Libertarians Straddle Political Divide

When David Leyonhjelm won a Senate seat for the Liberal Democratic Party at the 2013 federal election, many in the media did not know how to react.

Leyonhjelm described himself as a libertarian or a classical liberal. He subsequently was attacked for being too left-wing on drugs, gay marriage and national security, and too right-wing on guns and economics. Many in the press tried to pigeonhole the plain-speaking agribusiness owner as nothing but a kook: one of the crazies who had been raised above his station merely because of the preferential contortions of that election.

Yet what was so different about Leyonhjelm’s views from those of the other parliamentarians? His most controversial position, backing the right to own guns, would not be unusual in a National Party meeting, and it certainly was common enough before the Howard government moved to limit gun ownership. His views on drugs are not much different from those held by many progressives, and they are in step with an increasing acceptance by the political class that the war on drugs has failed. His support of gay marriage is shared by a sizeable majority of the population. And his views on economic policy are exactly those espoused by the free market wing of Liberal members of parliament – indeed, after the 2013 election, there was a widespread belief within Liberal circles that Leyonhjelm’s vote, at least on economic questions, could be taken for granted in the Senate.

It’s hard not to conclude that what makes libertarians unusual is nothing more than the constellation of views they hold, rather than the specific views themselves. There is a near-infinitesimal number of political positions that any individual may take, but the country’s political culture slots everything into a binary division: you are either with the Left, and therefore vote for Labor or The Greens, or you’re with the Right, and therefore vote for the Liberals or Nationals.

So more libertarian-minded people are buried in their parties, awkwardly lumped in with those who they might vehemently disagree with on social or economic issues.

In the Liberal Party, libertarians are found among the ‘‘hard right”, who strangely share that title with the conservatives who focus on social issues like gay marriage and abortion. Labor libertarians, such as they exist, are scattered on the left and right wings of the party, either hiding their admiration for economic liberalisation or turning a blind eye to the retrograde social views of the conservative unions.

It has been more than 30 years since the Hawke government began to deregulate and liberalise the economy. We’re still not over it.

In December 1983, Bob Hawke and his treasurer, Paul Keating, floated the dollar. Their decision was both inspired and visionary. Governments started to place their faith in markets. In 1985, the government opened the banking sector – one of the most tightly monopolised and anti-competitive industries in the Australian economy – to foreign competition. Throughout the next decade, publicly owned businesses were privatised. Tariffs and other trade barriers were lowered.

The labour market was substantially deregulated. The airline market was opened to competition. Ports were sold and restrictions on shipping liberalised. The final break with the past came with changes to the tax system – the introduction of the goods and services tax in 2000 replaced a sales tax regime that had been instituted by James Scullin’s Labor government in 1930.

‘‘Reform”, of whatever stripe, has become the gold standard of government. For the political class, a successful government is that which reforms; an unsuccessful government squibs on reform. But while one of the most common tropes in the press is the business-leaders-urge-reform genre, in which CEOs and corporate lobbyists complain that politicians are avoiding tough decisions about economic change, rarely do they offer any specific proposals.

The reform mantra has allowed each side of politics to dress up regulatory or legislative change as a great reform no matter what its purpose. For the Australian Labor Party, the minerals resource rent tax and the emissions trading scheme introduced by Julia Gillard’s government were considered great reforms. For the Coalition, abolishing those two schemes constituted great reform. Each harks back to the HawkeKeating era not just as precedents for economic change but as some sort of justification for that change. Reform has become the sine qua non of government.

What made the reforms of the 1980s significant was not their constituent parts but that they added up to an agenda. Governments of the time deliberately shifted the economy from one system of political economy to another. They began to instinctively favour market solutions to policy problems where their predecessors had looked to the state. It was a revolution in philosophy as much as it was a legislative program. Once the full significance of this revolution sank in, there was a host of books published by intellectuals of the old Left who believed that Hawke and Keating had hijacked the grand old Labor Party and its socialist-tinged traditions. The sociologist Michael Pusey argued that the commonwealth bureaucracy had been captured by economic rationalists, a sort of reverse-Fabian takeover of the institutions of government. These economic rationalists had a new idea of what Australia ought to look like and what values public policy should reflect.

But budding reformists have a problem. Since John Hewson’s economic policy package Fightback! died at the hands of voters in 1993, there has been no driving vision of what Australia might look like, no vision of what values ought to underpin political change.

There is scarcely any serious contest of ideas. We can attribute that to a generation of politicians too weak to build and defend a vision. It’s a neurosis that infects the entire political class.

My book, in all modesty, is an attempt to offer a new agenda. Libertarianism is a political philosophy that favours liberty in all its facets. The libertarian agenda is deceptively simple but powerful and ambitious. It wants people to be free to trade across national borders and to move their families across them, too.

It provides a philosophical structure for open markets, unencumbered by excessive regulation and red tape, exposed to and strengthened by engagement with a global marketplace. It views overregulation not simply as a cost to business but as a brake on human progress and innovation.

It takes seriously the choices people make about how they spend their money and sell their labour, without assuming that policymakers and the government know better what values those people are weighing up when they make risky decisions. It views entrepreneurs as the central driver of economic growth, and the key to future living standards. And it says that decisions are better when they are made by the people they affect. Libertarianism offers a new and important perspective on the biggest issues facing Australian society, from human rights to the environment and inequality, from trade to sexuality and gender.

It provides a new way through our moribund political debates. The libertarianism I argue for is a fundamentally practical one. It takes people as they are. It treats human society as an impossibly complex, endlessly diverse and infinitely exciting web of relationships and ideas. It asks what economic and political system suits a world in which people have different preferences and want to lead different lives, form different communities and enjoy different lifestyles, but all have equal rights. Government can only limit our liberties, not enhance them. Markets and civil society, by contrast, facilitate such difference, encourage toleration and co-operation, and take advantage of the natural pluralism of a free people.

Libertarianism exposes old problems to a new light, helping us understand how to tackle them and what’s at stake in doing so. As for the inequality debate, governments should first realise they’re already making the problems of poverty and inequality worse before they try to ‘‘fix” economic inequality. Environmental problems are regarded by libertarians as fundamentally property rights problems. Libertarianism also has a distinctive approach to freedom of speech and privacy, two of the thorniest issues of modern public policy. Some conservatives argue that libertarians can’t handle questions of national security and foreign policy – I make the case for a security policy that respects individual freedoms, and a non-interventionist foreign policy.

Returning to the domestic sphere, I tackle freedom of choice, consumerism, and what the human rights debate tells us about the state of libertarian ideas today. The economist Adam Smith wrote that all that was necessary to allow a nation to thrive was ‘‘peace, easy taxes, and a tolerable administration of justice”. What made sense in 1755 is even more compelling now, as technological change and innovation eliminates many of what our predecessors saw as the necessary limits on the market economy. We’re on the edge of a revolution in the way we work, the way the economy functions, and the way we relate to each other. Exploiting these possibilities to the fullest will mean rethinking what government is for – and recognising its limits.

Libertarianism is a philosophy of optimism. It is a philosophy that understands what institutions can and cannot do.

It embraces change. It embraces difference and diversity and pluralism. It wants government out of your wallet and out of your bedroom. Libertarianism, alone, wants individual freedom in all its dimensions.