The ‘rebirth of liberalism’: The origins of neo-liberal ideology

Abstract

This article examines the genesis of neo-liberal ideology in the Western world during the first half of the twentieth-century. Neo-liberalism, it proclaims, gets its distinctive identity from its origins as an ideological movement for the ‘rebirth of liberalism’ which was reacting to the various forms of collectivism that it saw sweeping through Western nations during this period, and its subsequent reinvention of the term ‘liberal’. The emergence of neo-liberalism was not a simple revival of classical economic liberalism and a return to the nineteenth-century ideas of free trade, a minimal state and self-help. Neo-liberal intellectuals in the 1930s and 1940s such F.A. Hayek, Ludwig von Mises, Alexander Rüstow and Michael Polanyi argued that liberalism must undergo a major intellectual process of reinvention where classical liberal tenets were stripped of accretions associated with the past and reinterpreted on a new ideological terrain. Their efforts culminated in the formation of the Mont Pelerin Society in 1947 where many of the core tenets of neo-liberalism were originally conceived.