Critically Evaluate the Linkages Between Hayek’s Classical Liberalism and Neo-Liberal Policy Prescriptions.
Classical liberalism emerged in the early nineteenth century as an idea explaining society's relevance to issues of poverty and wealth creation and its relationship to existing state political order or governance.
In the past, basic human economic needs had been constrained to preserve and sustain social cohesion. The social markets were the preserve of the society and subject to many kinds of regulation and restraint. The intended outcome of classical liberal economic experiment in the mid-Victorian England was to demolish these social constraints, and replace them by free and deregulated markets that operated independently of social needs. The breakdown in England's economic life that ensued has been called the 'Great Transformation' where according to Karl Polanyi "Nineteenth-century civilization has collapsed" (Polanyi, 1944:3). According Polanyi nineteenth-century civilization was constructed on four pillars or institutions. These four constructs were interdependent such that if anyone of the pillars collapsed the others would be also be uniformly compromised. The first of these pillars was the 'balance of power' system that prevented long and destructive wars between main global power blocks. The second was the monetary exchange system embedded in world economy based on 'gold standard'. The third was the system of trade based on self-regulating market that was entrenched in the social welfare of the society - that created unequal distribution. The fourth was the liberal political system of the state governance. Polanyi witnessed and experienced the period of the 'Great Depression' in 1929, which set in motion the collapse of 'gold standard' exchange mechanism system. And long before then, in order to save the 'gold standard' system the other three pillars had already been weakened in trying to prop up a system that was collapsing on all fronts both nationally and internationally. The main driver of the overall state structure was the free and
In the past, basic human economic needs had been constrained to preserve and sustain social cohesion. The social markets were the preserve of the society and subject to many kinds of regulation and restraint. The intended outcome of classical liberal economic experiment in the mid-Victorian England was to demolish these social constraints, and replace them by free and deregulated markets that operated independently of social needs. The breakdown in England's economic life that ensued has been called the 'Great Transformation' where according to Karl Polanyi "Nineteenth-century civilization has collapsed" (Polanyi, 1944:3). According Polanyi nineteenth-century civilization was constructed on four pillars or institutions. These four constructs were interdependent such that if anyone of the pillars collapsed the others would be also be uniformly compromised. The first of these pillars was the 'balance of power' system that prevented long and destructive wars between main global power blocks. The second was the monetary exchange system embedded in world economy based on 'gold standard'. The third was the system of trade based on self-regulating market that was entrenched in the social welfare of the society - that created unequal distribution. The fourth was the liberal political system of the state governance. Polanyi witnessed and experienced the period of the 'Great Depression' in 1929, which set in motion the collapse of 'gold standard' exchange mechanism system. And long before then, in order to save the 'gold standard' system the other three pillars had already been weakened in trying to prop up a system that was collapsing on all fronts both nationally and internationally. The main driver of the overall state structure was the free and