In the beginning was the hierarchy. In return for some labor and groveling, The People received protection, order, and security from their masters. The system had its advantages. Deprived of the opportunity to climb, peasants were free to focus on living the life they had, with no guilt for not achieving more. Free from competition from below, the gentry could be gentlemen: honorable, polite, and above petty money-grubbing. At least, that was the theory. The reality was less pleasant.

With the printing press came enlightenment, and attacks on the Old Order. The first wave was spiritual: the Protestant Reformation. Priesthood and ceremony gave way to personal Bible study, direct access to God, and individual moral responsibility. From there came the first attempts at democracy. Then came free-market economics. Liberalism was born.

“Liberal” stems from liberty. The original liberals were free thinkers, free traders, and advocates for the lower classes. Unshackle the bonds of caste and the lower classes will rise. Abolish the protections of the gentry and established businesses and the rich will fall. Liberals were on the Left from the start, yet their policies were what we today call libertarian.

Alas, the liberal dream did not work out as planned. A new oligarchy arose: the industrialists and financial manipulators. Life at the bottom was harsh: long hours of repetitive work in unpleasant factories. The defenders of the Old Order neener danced, crowing that the medieval peasant and the negro servant had better lives that those who labored under ignoble capitalists.

The Left split, with socialists calling for active government to rein in the rich and improve the plight of the poor. The remaining liberals relented, and began to contribute to the modern welfare state. As socialism waxed and government grew, the remaining liberals split, with believers in markets realigning with the Right, with protection of private property as their common theme. Those still calling themselves liberal rejoined with the socialist Left to create what we call “liberal” today in the U.S.

Thus divided, liberalism lingers, but barely. Government grows. We get welfare from the Left and privilege from the Right and special interest goodies from all. To reverse the trend we need to recreate true liberalism—free liberalism—that original coalition of market-based economists and advocates for those on the bottom.

We will not succeed with bromides and glib thinking, however. The libertarian movement tried and got nowhere. Liberalism did fail to live up to its original promise the first time around. To be credible we who would restore true liberalism must ask why. Possible explanations:

1. Liberalism is optimal, but it is not utopia. It has problems. Deal with it.
2. The problem with the original liberals is they did not go far enough. We must be more radical.
3. The problems of the liberal era were leftovers of the inequalities and injustices of the Old Order.
4. Liberalism works in the long term, but has some unpleasant transients. This was postulated by Smith and observed by Kuznets.
5. Liberalism is a good political order, but it needs spiritual backing, a replacement for the old noblesse oblige.
6. Liberalism is good, but it needs to be tempered by the concerns of conservatives and social democrats. Some compromise is optimal.
7. The original liberal ideal had some fundamental errors, which we should correct before we try to restore liberalism today.

In my younger days I passionately argued for the explanations at the top of the list—to little practical effect. Today, I focus on the bottom of the list, to the point some might call me illiberal. Liberalism needs to be fixed before it is brought back to life.

Not only do we need to fix what was wrong the first time around, we need to update the liberal ideal for the modern age. How do we remain safely free in an age of nuclear energy, nuclear weapons, recombinant DNA, and home-brewed weapons of mass destruction? How do we parcel out natural rights in a time of diminishing resources, vanishing nature, and externalities which cross property lines? How do we replace regulation with responsibility in an economy dominated by limited liability corporations?

And once we have an updated liberal ideal, how do we get there? Initial conditions are important; the conservatives have that much correct. How do we get people back into the habit of personal, family, and local responsibility after years of centralized welfare? How do we reform criminals hardened by evil prisons and dysfunctional public schools? How do we deal with the implicit property rights promised by Social Security, Medicare, government bonds and government pensions?

I am proposing quite a bit of intellectual work, and unpleasant work at that. Introspection is far less fun than utopian dreaming, grouching from the sidelines, indulging in conspiracy theories or pointless political action. But introspection can produce a solid foundation for future political action—effective action.

With errors corrected and workable plans in place, we can again ask, “How do we get there?” but this time asking it as a political question: how to rebuild the old coalition, to win elections and implement our fresh free liberal agenda.