How Libertarianism Works

By: Dave Roos

Classical Liberalism: John Locke and Adam Smith

It is within the newly liberated England of the Glorious Revolution that we meet John Locke, the father of classical liberalism. Classical liberalism is the original name for the political philosophy we now call libertarianism. The main reason for the name change is that the words "liberalism" and "liberals" invoke an entirely different meaning in modern politics. Libertarianism is a good substitute, since it holds the pursuit and protection of liberty above all else.

John Locke published his "Second Treatise of Government" in 1690. In it, he argues that the only role of government is to protect our natural rights, namely the rights to "Lives, Liberties and Estates" [source: Boaz]. Like other early libertarian thinkers, he argued that these natural rights superseded manmade rights, and that no ruler or government could seek to remove these "inalienable rights" [source: Boaz].


Locke launched a wave of libertarian thought that climaxed in the 18th century. In France, a group called the Physiocrats (literally the "rule of nature") developed the laissez-faire philosophy of economics, arguing that markets function best when free of government constraints and meddling.

Adam Smith, the second father of classical liberalism, reinforced the laissez-faire philosophy with his seminal work, "The Wealth of Nations." The Scottish philosopher wrote of the "invisible hand" guiding the course of free markets. The government should not and cannot use the force of law to bring about a particular economic outcome. Instead, if people are left free to pursue their own economic self-interest, the market will move organically in the direction of greater prosperity for a greater number of people, he wrote.

Smith saw no conflict between self-interest and the good of society [source: Concise Encyclopedia of Economics]. It is in our self-interest, for example, to earn money and provide for our families. To do that, we must offer a product or service that is desirable to other people. Since we are competing with others who offer similar products and services, it is in our self-interest to develop the best, most desirable product possible. Through free-market competition, consumers get the best products for the best prices, and we get income to support our families.

Smith's invisible hand is another term for spontaneous order, a central tenet of libertarianism. Libertarians believe that economic or social order cannot be created by a government committee or executive decree. Instead, the only successful and sustainable economic order must arise spontaneously from the seeming chaos of free market forces. When we go to the grocery store, most of us aren't conscious of how our purchases affect the course of the economy -- which companies thrive and which companies fail -- but our collective decisions form the invisible hand that steers the economy left or right, forward or backward.

Now it's time for the libertarian wave to travel to the American colonies, where it would sow the seeds of a revolution.