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Intermediate

Tensions within Liberalism

Paper 1, Liberalism 2: differing views and tensions within liberalism

Aligned to the Pearson Edexcel 9PL0 specification

Level
Intermediate
Reading time
13 min
Published
9 September 2026
On this page
  1. 1.Classical Liberalism: Negative Freedom and the Minimal State
  2. 2.Modern Liberalism: Positive Freedom and the Enabling State
  3. 3.Two Views of the Individual, Two Views of the State
  4. 4.The Economy: Laissez-Faire versus Keynesianism
  5. 5.Equality, Social Justice and What the Strands Still Share
  6. 6.Applying the Tension to a 24-Mark Question
  7. 7.Exam Focus: Common Mistakes

Key takeaways

  • Liberalism splits into classical and modern strands: classical liberals sought individual freedom through a minimal state, while modern liberals argued that free-market capitalism had itself left many people unfree.
  • Classical liberals define freedom negatively, as the absence of external constraint; modern liberals define it positively, as the actual capacity to develop and fulfil your potential.
  • The economic split follows: classical liberalism supports laissez-faire capitalism, while modern liberalism supports Keynesian demand management and a welfare state.
  • Both strands share individualism, rationalism, tolerance, foundational and formal equality, limited constitutional government and support for a market economy.
  • The disagreement is over what freedom requires rather than over whether the individual comes first, which is why modern liberalism is a development of liberalism and not a break with it.

Classical Liberalism: Negative Freedom and the Minimal State

Classical liberalism is the original strand: the early liberals, who expected freedom to be most secure where government did least. It grew out of the Enlightenment and the struggle against absolute monarchy, so its instinct is to identify the state as the principal threat to the individual.

Its positions are tightly connected:

  • Negative freedom. Liberty is the absence of external constraint. A person is free to the extent that nobody obstructs them, and interference in private life is itself the injury. (Extra context — the negative and positive labels were popularised by Isaiah Berlin's 1958 essay Two Concepts of Liberty; Berlin is not one of the specification's named thinkers, but the terms are on the Edexcel key terminology list.)
  • The minimal state. Government is confined to protective functions: defence, law and order, the enforcement of contracts and the protection of property. Anything more encroaches on the private sphere.
  • Egoistical individualism. Individuals are self-interested and self-reliant, and freedom means being left to pursue their own purposes.
  • Laissez-faire capitalism. Markets coordinate the choices of free individuals better than officials can, so the economy should be left alone.
  • Meritocracy through equality of opportunity. Remove artificial barriers, then let outcomes follow talent and effort.

On the classical view, a person with no money and no education is unfortunate rather than unfree. Nobody is stopping them; that is what freedom means. Modern liberals treat this as the fatal weakness of the position.

Classical liberalism also inherited a suspicion of unlimited democracy. If the majority can vote to redistribute, then the state that democracy controls becomes the threat all over again — which is why classical liberals emphasise constitutions, entrenched rights and the dispersal of power.

Modern Liberalism: Positive Freedom and the Enabling State

Modern liberalism grew up in opposition to unregulated market capitalism, on the argument that it had left many individuals unfree. By the late nineteenth century industrial Britain contained large populations who were legally unconstrained and practically powerless, and liberals had to decide whether that counted as freedom.

Their answer redefined the term. Positive freedom is personal fulfilment and the realisation of potential: a person is free when they can actually make something of their life. Freedom could no longer be defined simply as being left alone. (Extra context — the philosopher T. H. Green, writing in the late nineteenth century, is usually credited with turning British liberalism towards this view; he is not one of the specification's named thinkers.)

The state's role changes accordingly. The enabling state is a larger state that removes the obstacles standing between people and their potential.

Obstacle to positive freedomEnabling response
IgnoranceUniversal, state-funded education
Ill healthPublic healthcare
Poverty and insecurityPensions, unemployment support, a welfare safety net
UnemploymentGovernment management of demand to sustain jobs

Worked example — the Liberal welfare reforms, 1906–14. The Liberal government introduced free school meals in 1906, old age pensions in 1908 and the National Insurance Act in 1911, providing limited health and unemployment cover for working people. These were the first substantial admissions by a British governing party that individual freedom could require the state to act rather than to withdraw. The Beveridge Report of 1942, written by the Liberal William Beveridge and aimed at the five giants of want, disease, ignorance, squalor and idleness, extended the same logic into the design of the post-war welfare state.

Modern liberals insist this is still liberalism. The purpose of the enabling state is the development of the individual, not the strengthening of the collective — the goal remains the person, and the state remains a means.

Two Views of the Individual, Two Views of the State

The clearest way to hold the tension in mind is to notice that the two strands disagree about what an individual is and therefore about what the state is for.

Classical liberalismModern liberalism
IndividualismEgoistical: self-interested, self-reliantDevelopmental: capable of flourishing if enabled
FreedomNegative: absence of constraintPositive: capacity for self-realisation
The stateMinimal; a necessary evil to be containedEnabling; a means to make freedom real
The economyLaissez-faire capitalismKeynesian management and regulation
EqualityFoundational, formal, opportunity in the sense of no legal barriersThe same, plus active removal of social and economic barriers
Social justiceJustice is fair procedure; outcomes are whatever free choices produceJustice requires that the worst-off have lives worth living
Named thinkersLocke; Wollstonecraft; Mill on the harm principleRawls; Friedan; Mill on individuality

Worked example — is an unschooled adult free? A classical liberal answers yes: no law prevents them from taking any job, so their freedom is intact and their difficulty is a misfortune, possibly a matter for private charity. A modern liberal answers no: the range of lives realistically open to them has been closed off, and a freedom that cannot be exercised is a formality. Both answers are derived from individualism — which is precisely why the disagreement is internal to liberalism rather than a boundary with another ideology.

John Stuart Mill is the bridge between the strands and is worth positioning carefully. His harm principle is a classical statement of negative freedom; his stress on individuality and self-development anticipates the developmental individualism modern liberals build on.

The Economy: Laissez-Faire versus Keynesianism

The economic split is the most concrete expression of the tension, and it is where examiners expect precise vocabulary rather than a general sense that one side likes markets more.

Laissez-faire capitalism. Wealth is privately owned, production is driven by profit, and the market — not the government — decides what is produced and at what price. The classical argument is threefold: markets aggregate information no planner can hold; voluntary exchange leaves both parties better off; and a state with economic power will use it to reward its supporters. Government's economic job reduces to protecting property and enforcing contracts.

Keynesianism. John Maynard Keynes argued in The General Theory of Employment, Interest and Money (1936) that markets can settle at an equilibrium with high unemployment and stay there, because when households and firms all cut spending at once, falling demand justifies the pessimism that caused it. Government can break the loop by managing demand — spending, taxing and borrowing counter-cyclically — to sustain full employment and stable prices.

Laissez-faire positionKeynesian position
Do markets self-correct?Yes, if left aloneNot reliably, and the adjustment can take years
Role of governmentRefereeStabiliser and investor
Attitude to unemploymentA temporary market signalA destroyer of individual potential
Link to freedomIntervention reduces negative freedomMass unemployment destroys positive freedom

The point to carry into an essay is that both positions are defended in the name of individual freedom. Modern liberals did not adopt Keynes because they had become socialists; they adopted him because they had concluded that an economy producing mass unemployment was producing unfree people.

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Equality, Social Justice and What the Strands Still Share

Both strands accept foundational equality, formal equality and equality of opportunity, and both reject equality of outcome. The disagreement concerns what equality of opportunity requires in practice.

  • Classical: opportunity is equal when the law imposes no barriers. Careers are open to talent, and what people then make of them is their own affair.
  • Modern: opportunity is not equal while poverty, poor schooling and discrimination decide outcomes before talent gets a hearing, so the state must act on those conditions.

John Rawls provides the modern liberal argument in its strongest form. Choosing the rules of society from behind a veil of ignorance, not knowing what talents or starting position you would receive, a rational person would insist on extensive basic liberties for everyone and on arranging inequalities so that the least advantaged are as well off as possible. The conclusion is redistributive; the method — individuals reasoning about their own interests — is unmistakably liberal.

The shared ground, which decides most 24-mark questions:

Shared commitmentHeld by both strands
IndividualismThe individual, not the group, is the unit of political value
RationalismPeople can reason about their own interests and settle disputes by debate
Freedom as the supreme valueThey differ over its definition, not its rank
Foundational and formal equalityEqual rights, equal standing before the law
ToleranceRespect for views one rejects
Limited, constitutional governmentEven the enabling state is checked, elected and bound by rights
Capitalism and private propertyModern liberals reform the market rather than abolish it
Rejection of equality of outcomeUnequal results from fair processes are accepted

A modern liberal state is bigger than a classical liberal one, but it is not unlimited. Constitutionalism, civil liberties and judicial protection of the individual survive the shift intact — which is the strongest evidence that the two strands belong to one ideology.

Applying the Tension to a 24-Mark Question

Section B asks a single "To what extent" question worth 24 marks, marked AO1 8 / AO2 8 / AO3 8, and requires the key ideas of named thinkers as evidence. Take: To what extent do liberals disagree about the role of the state?

StageContent
Shared ground (AO1)Both strands treat the state as a means to individual freedom, insist it rests on consent, and bind it with constitutional limits. Locke supplies the foundation: government exists by agreement and may be limited from below
The disagreement (AO2)Classical liberals want the minimal state because interference is itself unfreedom; modern liberals want the enabling state because unaided individuals cannot use their freedom. The dispute follows directly from negative versus positive freedom
Thinker evidence (AO1/AO2)Mill sits on both sides: the harm principle confines the state, while his emphasis on individuality points towards development. Rawls shows the enabling state being derived from individual reasoning behind the veil of ignorance, not from collectivism
Counterweight (AO2)Even modern liberals keep entrenched rights, elections and judicial checks, so the argument is about the state's size rather than its authority over the individual
Judgement (AO3)Take a line — for example, that the disagreement is genuine but contained, because both strands measure the state by the same test: does it make individuals more free?

How to deploy a thinker properly. Weak: "Rawls wrote about the veil of ignorance." Strong: "Rawls shows that the modern liberal state can be derived from classical premises: individuals reasoning about their own interests, ignorant of their position, would choose both extensive liberty and protection for the worst-off — so redistribution here is an individualist conclusion, not a socialist import."

Exam Focus: Common Mistakes

1. Treating modern liberalism as socialism with a different name

Modern liberals keep private property, market economics, unequal outcomes and the individual as the unit of value. They enlarge the state to serve individuals, not to advance a class.

2. Defining positive freedom as "the state doing things"

Positive freedom is about personal fulfilment and realising potential. State provision is the means some liberals propose; it is not the definition.

3. Ignoring the shared ground

A "to what extent do they disagree" question needs the agreements as much as the differences. Individualism, rationalism, tolerance, formal equality and constitutional government run through both strands.

4. Losing the vocabulary

Negative freedom, positive freedom, minimal state, enabling state, egoistical individualism, developmental individualism, laissez-faire capitalism and Keynesianism are on the Edexcel key terminology list. Precise terms are quick AO1 marks.

5. Placing Mill in one camp

Mill's harm principle is classical; his account of individuality and self-development feeds modern liberalism. Explaining the ambiguity earns more than picking a side.

6. Using undated contemporary evidence

Attribute and date anything current. As of September 2026 the Liberal Democrats are led by Sir Ed Davey, leader since 27 August 2020, and a YouGov poll of 6–7 September 2026 put the party on 11–12% in a five-way contest.

7. Balancing without concluding

Eight of the 24 marks are AO3. Decide whether liberalism is fundamentally united or fundamentally split, and defend the verdict rather than leaving the reader to infer it.

Key terms

Classical liberalism
The earlier liberal tradition, holding that individual freedom is best secured by keeping government small and leaving markets alone.
Modern liberalism
The later liberal tradition, holding that unregulated capitalism left many people unable to use their freedom, so the state must actively enable them.
Negative freedom
Freedom understood as the absence of obstacles placed in a person's way, with private life left alone.
Positive freedom
Freedom understood as actually being able to make something of your life, rather than merely being unobstructed.
Minimal state
A government cut back to protective functions, on the argument that a larger one would encroach on individual liberty.
Enabling state
A more active government that supplies the education, health and security people need before their freedom is worth much to them.
Laissez-faire capitalism
An economy left to the market, with privately owned wealth and production driven by profit rather than by government direction.
Keynesianism
The doctrine that government should manage demand through spending and taxation to sustain full employment and stable prices.
Egoistical individualism
The classical view that being free means being left alone to pursue your own interests and to stand on your own feet.
Developmental individualism
The modern view that being free means having the conditions to develop your talents and lead a fuller life.

Frequently asked questions

Classical liberals want a minimal state and define freedom as the absence of constraint. Modern liberals want an enabling state, arguing that poverty, ill health and ignorance leave people unfree even when no law restricts them.

Negative freedom is the absence of external obstacles — nobody is stopping you. Positive freedom is the ability to actually do something with your life, which may require education, healthcare or income to be provided.

No. Modern liberals accept private property, a market economy and unequal outcomes, and intervene to make individuals genuinely free. Socialists pursue equality itself and treat class, not the individual, as the basic unit.

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