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John Quiggin's avatar

The idea that free trade is central to liberalism marks the big divide between Mill and Hayek. Even before he shifted to a vague socialism, Mill was clear that liberal support for free trade was contingent on the fact that economists had concluded that free trade was a good thing. That conclusion was qualified a lot in the 20th century until the market counter-revolution of the 1970s, and liberals in the Mill tradition responded accordingly.

For Hayek, by contrast, freedom of action (of which free trade is the prime example) trumped freedom of speech and thought. Hence his support for Pinochet and action to crush unions in the UK (which even Thatcher thought was not feasible in a democracy).

Neoliberalism can be seen as free trade liberalism write large. It has failed, and dragged down liberalism in the process.

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