Category: c. 1815 – c. 1914

The Beginning of the Cold War: Similarities and Differences Between Socialism and Liberalism in the Nineteenth-Century Europe


Since the Second World War, the world is divided into two: the capitalist nations and the communist nations. Communism being rooted to socialism, the conflict started in the nineteenth century Europe. Back then, capitalism, in the name of liberalism, was developing. Yet, some liberalists who found mistakes in capitalistic model of the society formulated Utopian Socialism. They both were similar that they valued equality, yet were different that liberalism valued economic liberty which led to poor condition of working when socialism emphasized equality of all social members which improved the working condition of the laborers.

It is true that both wanted equality of people. Liberalism of the nineteenth-century originated from enlightenment ideals, majorly summarized to equality and liberty. Since the beginning of French Revolution, liberalists, who were majorly consisted of bourgeoisies, advocated for expanded suffrage. The cahier de doléances written during the French Revolution shows that one of the most frequently appearing concerns about the government was equal political representation and fair voting system in the General Estate. Furthermore, the “Declaration of the Rights of Man and of the Citizen” signed during the French Revolution shows the ideas of the growing liberalism. The declaration states that all “men are born and remain free and equal in rights” and that “social distinctions can be founded only on the common good”. This declaration becomes the foundation of all classical liberalism ideals. Economic liberalists such as David Ricardo and Thomas Malthus do not distinguish men according to their class but only according to their personal interest. Also, political liberalists who believed in utilitarianism such as Jeremy Bentham believed that maximum happiness for the maximum number should be achieved. However, this statement also assumes the fact that all human beings are equal thus their happiness is valued equally. Similarly, the socialists during the nineteenth-century supported equality between all human being. The nineteenth century socialists, referred to as Utopian Socialists by later philosophers, dreamt of small societies in which all members of the community were valued equally (of course according to the natural law) by sharing the workload and profit of the community amongst the members equally. Examples of the Utopian Socialist communities are Phalansteries created by Charles Fourier and New Lanark created by Robert Owen. Charles Fourier created the Phalansteries in hope to create ideal societies in which individuals work equally for a common goal and earn equally. Also, New Lanark aimed to decreasing the economic gap between the poorly treated factory workers and the rich capitalists. The workers in New Lanark were paid more by the capitalists so that the general workers’ living condition got more equal to the managers’ compared to other factories around Europe. These examples show how Utopian socialists valued equality similar to how the liberalists of the nineteenth century did, if not more. As discussed above, this similarity accounts for the origin of the two ideas. Both liberalism and socialism originated from the ideals created during the French Revolution which emphasized the importance of liberty, equality, and fraternity in society. Thus, both ideas supported equality of all people.

Although liberalists and socialists aimed at general equality, their focus diverged on to what extent they expanded equality. Liberalists did value equality like how socialists did. However, they interpreted equality as non-interruption of social order to artificially create social difference unlike socialists who defined equality as state in which all human beings are held at equal value: equal working and equal earning. Adam Smith and Jeremy Bentham formulated the idea of Laissez-Faire and Utilitarianism which founded the nineteenth century liberalism which emphasized economic liberalism and individual self-interest. David Ricardo, a classical liberalism philosopher, was deeply influenced by Smith’s idea written in the Wealth of Nations. He then wrote books regarding economic phenomenon shown in nineteenth century Europe. Encompassing all economic situations, an assumption and a hypothesis that Ricardo and Smith make is that people will and should maximize self-interest to maximize profit. This sometimes may be presented unequal between different social groups, for example, Ricardo’s theory on wages says that the wage of any worker will tend toward the minimum wage that the worker can receive. Thus, the investors will maximize their interest while the laborers will receive just the right amount of money to survive, eventually increasing the gap between economic social classes. This shows how liberalists did believe in equality under law, yet advocated for inequality through fulfilling individual interests. Unlike liberalism, Utopian Socialists believed otherwise. They criticized capitalism for pursuing nothing but self-interest. Charles Fourier in his On Economic Liberalism writes that it is ridiculous that merchants can throw away tons of grain during the times of great famine just to increase grain price and maximize profit. He continues to say that thus, “commercial liberty should be subject to restrictions consistent with the needs of society as a whole” (Fourier). This shows that Fourier believed that general welfare should be above individual interest. Consistent to his argument, Fourier established phalansteries where community members worked for the common welfare rather than individual profit. Fourier’s idea shows that Utopian Socialists criticized liberalists’ emphasis on individual interest while highlighting the importance of general wellbeing of the society. The difference exists because Utopian Socialism came into being when philosophers tried to tackle problems of liberalism. Like Malthus, some inteligencias saw inequality between the poor and the rich. This led idealists like Fourier and Owen to construct the Utopian Socialism. Thus, the difference between liberalism and Utopian Socialism was inevitable.

Following the said difference, liberalism and socialism differed in ways they viewed workers. As discussed above, liberalists believed in maximizing individual self-interest. Yet, since the bourgeoisies who controlled the capital and the land owning aristocrats were the only social groups who could control their self-interest by either increasing or decreasing the profit, the laborers were not able to intervene in determining their profit. According to Ricardo, the wage of the laborer will tend toward the minimum amount of money that the worker can survive with and that is the Iron Law of wages. This is due to the assumption that most liberalists made: all economic participants will maximize their profit if they can. Since the bourgeoisies will maximize their profit, the expenditure on laborer will decrease toward the minimum amount they can receive. Thus, naturally, the living condition of the workers fell to a state in which laborers were forced to live in congested slums with basic clothing. However, unlike liberalists who maltreated their workers, Utopian Socialists provided their workers with comparatively higher standard of living. Robert Owen, developing his industry in New Lanark, gave workers higher wages. This was clearly against the assumptions of the liberalists while aligning with socialism since the capital-controlling bourgeoisie sacrificed his profit for the general welfare. The highly paid workers’ standard of living rose and the total revenue increased as well. With the increased production, workers’ wage increased more. This cycle demonstrates the Utopian Socialists’ belief in improving the working condition of the laborer. These differences occurred due to their difference in the emphasized value. Since liberalists believed that individual interests should be valued more, the working condition of the laborers will naturally fall in the process of maximizing the profit of the higher class when socialists believed that individual interest should be sacrificed for equality and general social welfare in which the laborer’s living condition will be enhanced.

To conclude, liberalism and socialism during the nineteenth century showed very different traits of belief despite their common root in the ideals of the French Revolution. These two major ideas of the nineteenth century Europe later grows to be the two dominant ideas of the world. Due to their ideological difference, physical and mental wars occur between many countries where many people die. The two ideologies, liberalism and socialism, are clearly different in terms of what they emphasis and how they manage. However, it is important to remember that they both aim for the same goal, equal society.