LIBERALISM IN CRISIS: PERSPECTIVES FROM ARTS AND HUMANITIES

 

Aloy Buragohain ¹ 

 

¹ Plaksha University, Punjab, India

 

1. INTRODUCTION

“Do more and more liberals find the emotions unleashed by the arts—I mean all of the arts, from poetry to painting to dance—something of an embarrassment? Are the liberal-spirited people who support a rational public policy—a social safety net, consistency and efficiency in foreign affairs, steps to reverse global warming—reluctant to embrace art’s celebration of unfettered metaphor and mystery and magic? […] What is certain is that in our data- and metrics-obsessed era the imaginative ground without which art cannot exist is losing ground. Instead of art-as-art we have art as a comrade-in-arms to some more supposedly stable or substantial or readily comprehensible aspect of our world” Perl (2014).

The anti-utilitarian tenor of this excerpt is a riposte to the systemic drive towards datafication that defines today’s liberal epoch. Taken from a 2014 essay by the American art critic Jed Perl, these words serve as a warning against the technological transformation of art—and by extension, life itself—into a tool in the endless pursuit of value. Utility also presumes an underlying rationale towards which it appropriates objects. If liberalism indeed views art—and everything surrounding it—as a tool to accomplish something more substantial in an imagined future, what is that image of the future? The answer to this question lies in the vision—of the world and its inhabitants—with which liberalism was founded.

The present essay is a critical reflection on that liberal vision as it has unfolded. It begins by emphasizing the role of the performing arts and, especially, their essential element—the body—as a bulwark against liberalism. Then, it delves into the institutional, political, and philosophical discourse around liberalism, tracing its rise through successive, interrelated ideological currents. This is followed by an explication of the subsumption of the body by behavioural economics, possibly paralyzing this potent defence of the human against the economic calculus of liberalism. This commentary grapples with several questions: What form does the object/subject of art assume in a liberal discourse? What is the future of liberalism? What happens when an economic paradigm encounters the realm of human imagination? And above all, what does liberalism mean?

 

2. THE SUBVERSIVE BODY

The performing arts furnish a critique of (neo)liberalism by defying the latter’s demand for constant productivity. Notwithstanding their growing economic function, they continue to challenge the valourization of art driven by the market, and oppose the instrumentalization of culture, often adopting disruptive, anti-capitalist, anti-elitist, or non-conformist approaches. If liberalism is indeed based on an assumption of autonomy, then these arts highlight the limits of such autonomy by foregrounding community-driven, social, or even overtly political forms of engagement.

Of all the elements that constitute a performance, the body stands out due to its indispensability. Often viewed as a primary medium in the performing arts, it acts as a site for communication, expression, and meaning-making through gestures, movement, and physical presence. Besides the corporeality of the body being crucial for executing technicalities of dance, vocal renditions, or theatre, it acts as a bridge between the conceptual and the tangible. Apart from archiving memory, the body enacts social and cultural commentary. Since it is influenced by societal structures like class, race, and gender while being shaped by lived experiences, the body emerges as a powerful medium of engaging with social realities. In performance art, the body of the artist is the central, active, and often, the singular element of the performance. The artist’s live, physical presence generates an immediate, visceral connection with the viewers, distinguishing it from static forms of art. The body, thus, brings human experience to life.

In resisting liberalism, the body serves as a critical site, challenging the former’s foundational premise of an autonomous, disembodied, and rational individual. Liberalism has traditionally posited a “free” agent, detached from bodily limitations, who operates in the public sphere through reason and speech Prokhovnik (2014). Such a view ignores the body's inherently political, vulnerable, and situated nature, which enables it to contest (neo)liberal norms Borren (2024), Castelli (2019). The body does serve as a site of resistance to the liberal ideology by challenging the Enlightenment-era construction of the person as a rational, autonomous, and disembodied individual. By emphasizing self-ownership and abstract rights, the liberal framework fails to capture the material reality of embodied existence shaped by race, gender, dependency, and vulnerability. Resistance, therefore, is offered by acts of re-politicization of the body, asserting the centrality of embodied experience to political life Castelli (2019), Hafez (2023), Jatkar (2023), Prokhovnik (2014).

The philosopher Judith Butler’s “politics of assembly” goes a long way in highlighting the resistance to restrictive, neoliberal environments that emerges simply through the presence of bodies gathered in public spaces like streets and squares. These actions address the unequal distribution of vulnerability, that is, the ways in which certain bodies—those of women, migrants, racialized, queer, or poor people—are rendered more vulnerable by the state than others Borren (2024). Furthermore, approaches like those of Italian feminist theory stress the political nature of the body and its associated experiences of care, reproduction, sexuality, and disease, eschewing the strict separation of private and public spheres that characterizes liberal thought Castelli (2019). There are also ample instances of movements using the body itself for political messaging, especially when other forms of expression are suppressed. Examples include protests against police violence, and occupation of spaces to disrupt normal modes of functioning, such as in the Black Lives Matter movement, the Arab Spring, and the Occupy movement of the 2010s Hafez (2023), Borren (2024).

Theoretical frameworks for embodied resistance include, among others, feminist and queer theory. Beyond discourses around “naturalness” of the gendered body, scholars have highlighted instances of enforcement of heteronormative bodies by liberal law itself. Avenues for resistance comprise, among others, queer and non-normative expressions of identity (Farbis et al., 2022). Decolonial approaches to embodiment recognize the continuity of colonial violence beyond the end of formal colonialism. Such violence degrades bodies through existing economic and systemic structures, which makes the body's reclamation a central act of liberation Ureña and Varma (2025). An emerging field, somaesthetics, focuses on the living, sentient body as a means for regaining aesthetic experience and challenging the mind/body dichotomy. This project is devoted not only to critical study, but also to meliorative cultivation of the use and experience of the living body for sensory appreciation and self-stylization. Besides discursive knowledge of the body, somaesthetics seems to enrich lived somatic experience as well as performance Castelli (2019), Shusterman (2014).

In essence, the body is a “living, perceptive, sentient” entity—contrary to the disembodied, abstract subject of the liberal ideology—which performs through its unique needs, vulnerability, and collective action. The body offers resistance to the liberal ideology by effecting a confrontation between the universalized, abstract ideals of liberalism and the material, concrete, and vulnerable realities of human life. Given the visibility and, to some extent, success achieved by performative movements around the world (for example, the Chipko Movement, the Arab Spring, and the Indignados Movement), it is worth investigating the counter-strategies emerging in the (neo)liberal camp to salvage itself. Today, liberalism happens to face a particularly intractable set of challenges. This historical juncture, therefore, demands a stock-taking of the state of liberalism.

 

3. POLYCRISIS IN THE LIBERAL GLOBAL ORDER

In the philosophy of Martin Heidegger, only in moments of dysfunction or crisis does a thing in the world reveal its true state. At other times, one is too immersed in the affairs of the world to be consciously aware of the state of affairs. The state of liberalism in the world, today, resonates with this Heideggerian view. As early as 2011, Georg Sørensen warned us of the many emergent threats to a “liberal world order”. The collapse of the Soviet Union—and with it, the bipolar international system—towards the end of the last century transformed liberalism from a regional political system aspiring for universality to a global ideological vision of the form that international interactions should adopt. Sørensen suggests that liberal democracies have, nonetheless, failed to consolidate a liberal world order primarily due to tensions between two forms of liberalism. A “liberalism of imposition” avows the universality of liberal ideals, and is ever ready to use any means to propagate liberal values across national borders. A “liberalism of restraint”, on the other hand, stresses moderation and non-intervention based on mutual respect Sørensen (2011). Elsewhere, this “order” has, interchangeably, been called the “liberal global order” Mearsheimer (2019) and the “liberal international order” Deudney and Ikenberry (1999). This paper prefers the term “liberal global order” since it better captures the pervasive and transnational character of this order.

This global order, observers widely acknowledge, is in a state of crisis today. Due to the multifarious sources of this crisis, it may be identified as a polycrisis. Three of the most consequential sources of this polycrisis are:

1)    Recent international conflicts:

1)     The Russo-Ukrainian war: The war between Russia and Ukraine poses a major threat to the liberal global order because Russia has explicitly rejected its basic tenets of sanctity of territorial borders and prohibition of territorial expansion by forceful means. It has, instead, promoted an alternative view of a multipolar global order based on civilizational states and spheres of influence Mankoff (2024).

2)     The Gaza war: The war fought in Gaza between the state of Israel and Hamas has presented another grave challenge to the liberal global order by having exposed its perceived hypocrisy, institutional failures, and limits of international law when it comes in conflict with the interests of major powers at the helm of the liberal order. This conflict has significantly contributed to the erosion of the global order’s institutions, and principles of universality and inclusivity Callamard (2024). This war also served as a spark for the subsequent—and ongoing—military conflicts between Israel and the U.S. on the one hand, and Iran and its proxies on the other.

3)     Trump's trade war: American President Donald Trump's trade war—often against partner countries—represents a formidable challenge to the liberal global order by rejecting its fundamental principles of free and open trade, multilateralism, and shared values. Trump has, instead, promoted a highly transactional, “America First” approach. This shift in US policy undermines institutions like the World Trade Organization (WTO) and norms that have run global trade since World War II Horton and Hopewell (2021), Mishra and Wang (2025).

2)    The parallel rise of the intergovernmental organization BRICS:

As an alternative to the Bretton Woods institutions controlled, largely, by the West, BRICS has challenged the liberal global order. BRICS promotes a multipolar world, advocating greater representation of the Global South. Besides running a parallel financial institution like the New Development Bank (NDB), it is endorsing de-dollarization with a view to end Western economic hegemony. It offers alternative norms focused on inclusive growth, sovereignty, and non-interference, which contrast with perceived Western interference and exclusivity Mulrenan (2023), Nach (2025).

3)    The COVID-19 pandemic:

The COVID-19 pandemic shook the very foundations of the liberal global order by devastating international mobility. The signal feature of the liberal order is political and economic openness which, in turn, is based on mobility. The significant restriction of international movement dealt a near-fatal blow to these principles Norrlöf (2020).

4)    The worsening state of the “natural” environment:

Mismatch between global economic integration and capacity for political cooperation to mitigate transnational environmental challenges—most notably, climate change—is a major driver of crisis in the liberal order Snower (2019). The present “liberal environmentalism” strategy, which assumes environmental protection and economic growth as mutually complementary, has proven to be inadequate for addressing the urgency and scale of the natural environment's catastrophic state Krogmann (2025).

The above instances clearly show that the stability of the liberal order is contingent upon multiple actors and factors. Being the outcome of a transnational project, this order is dependent, for its existence, on a sense of shared legitimacy. Today such legitimacy is under tremendous strain, primarily due to disputes between liberal democratic states and authoritarian ones, besides divisions within liberal democratic states themselves. This exposes the fragility of the liberal consensus and the contested nature of the foundations of the liberal order Ramos Coelho (2025).

However, as one begins interrogating the liberal global order, it is necessary to understand the term “order” itself.

 

4. ORDER

The word “order” is, most probably, derived from the Latin word “ordo” which stands for a “row of threads in a loom” which, in turn, stems from the Proto-Indo-European root *h₂er- meaning “to fit together”. This root is associated with the concept of cosmic order, referring to that which is fitting, ordered, or right. Its cognates in sub-families of Indo-European languages include ṛta (“order, rule, rhythm, logos” in Sanskrit), arəta (“order” in Avestan), art (“innate feature, fashion, nature” in Middle High German), artus (“joint” in Latin), artús (“arrangement” in Greek), and possibly, arete (“excellence” in Greek). Since entering the English lexicon, “order” has assumed diverse meanings ranging from class, arrangement, or religious discipline to commands, chivalric groups, or biological ranks. This concern for commanding, arranging, and “fitting together” reflects the central idea behind an order, which is, to maintain control, or to restrain. Behind the call to order, then, there seems to be a tacit acknowledgement of an inherent unruliness of that which is being ordered. In the case of a political order, that which is thought to need ordering is the human object (“citizen”) who is a subject of the order.

Philosophers Thomas Hobbes and John Locke, key intellectual originators of social contract theory, offered differing views on political order: Hobbes, dreading the war of all against all, which characterized the state of nature, advocated absolute sovereignty of the Leviathan for the sake of security; Locke, observing natural rights—life, liberty, and property—in a more peaceful state, advocated limited government by consent in order to guard those rights. While both used consent, Hobbes's vision of political order comprised a strong sovereign or absolute monarchy which would prevent a return to anarchy. Locke’s political order, on the other hand, was a representative, limited government of the parliamentary kind, accountable to the people who had a right to revolt if it ever became tyrannical. Hobbes is often viewed as a “proto-liberal” for grounding the government on consent and stressing individual self-preservation, while offering an authoritarian solution. Locke, however, is widely considered the founder of classical liberalism, emphasizing consent, individual rights, limited government, and the rule of law.

 

 

 

5. THE RISE OF THE LIBERAL GLOBAL ORDER

The journey of this set of values from seventeenth century post-Cromwellian England to a status of near-universal dominance has coincided with the ascent of North Atlantic (Northwest European and North American) political institutions to the helm of “global” governance. In particular, the three decades following the end of the Cold War witnessed the ideological hegemony of liberalism as the predominant social-economic system in much of the “free world”. So extensively have the tentacles of liberalism stretched across the world that today the existence of a Liberal World Order is often accepted as a truism, overlooking the fact that until a century ago, the relatively peaceful world that we know today did not exist, being torn apart, instead, between conflicting empires and states.

The term “world order” has been in vogue for more than a century. In the aftermath of World War I, in connection with the establishment of the League of Nations, the American President Woodrow Wilson used the phrase “new world order”, in the belief that it was finally possible to conceive of a system to prevent future international conflict. Notwithstanding the novelty of this vision, political order, albeit in an inchoate form, had already existed in the West for centuries. It would, therefore, be more precise to talk about an international order when the European order transmuted into a “global” one. Besides, before the European order, an emergent international order could already be found in other regions of the world Grinin (2016). In 1988, Soviet leader Mikhail Gorbachev also referred to a new world order in a speech at the United Nations, envisaging peace after the Cold War. Russian statesman Yevgeny Primakov, in 1996, ideated a multipolar (polycentric) world order focusing on Russia, China, and India, proposing a credible alternative to a United States-centric world order.

Regardless of these earlier coinages, when one speaks of the “world order” today, it largely refers to a particular type of order: the liberal global order. In the field of international relations, this liberal global order is also referred to as the rules-based order, which consists of a set of structured, global relationships based on rules governed by the tenets of political and economic liberalism, besides liberal internationalism, operational since the end of World War II Lake et al. (2021). Led in large part by the U.S., this order entails intergovernmental cooperation through multilateral institutions like the United Nations, the World Bank, the International Monetary Fund, and the World Trade Organization. It is said to be constituted by the principles of human equality (exemplified by human rights, freedom, and the rule of law), open markets, monetary cooperation, security cooperation, and promotion of liberal democracy Ikenberry (2018), Lake et al. (2021), Norloff, 2020). Overall, this is a strategic, political, and economic order conceived by the U.S. and its allies as a solution to the problems that caused the interwar economic depression and World War II Deudney and Ikenberry (1999). This ideological model proved widely successful in the post-war period with nation-states across continents displaying general adherence to liberal democratic principles of governance. This trend accelerated following the demise of the Soviet Union, which led scholars like the American political scientist Fukuyama (1992) to declare the liberal democratic ideology as the final stage in the dialectic of human history. Advocates of liberalism widely attributed this success to the supposed advance of democracy, economic growth, and general equality that liberalism promoted.

Since the first decade of this millennium, however, there is a growing perception that liberalism has failed to respond to the changing demands of society. Be it socioeconomic development or general wellbeing, liberalism seems to have lost the promise it once held for humanity. Nevertheless, as late as 2022, Fukuyama (2022), in a last ditch effort to salvage the liberal ideology, offered a defence of classical liberalism against attacks from both the ends of the ideological spectrum. Fukuyama’s thesis is that present-day social fragmentation and political polarization have happened only as a result of the fundamental principles of liberalism being pushed to extremes. Liberalism proper, on the contrary, has proved highly successful. Here, he defines classical liberalism as the doctrine prioritizing the rule of law, tolerance, and individual rights, which arose in the seventeenth century as a remedy for religious conflict. Among the extremes that Fukuyama identifies as “discontents” is neoliberalism—the belief that unregulated markets succeed in delivering consumer welfare—along with its economic excesses. In Fukuyama’s appraisal, neoliberalism is a distortion of liberalism which, otherwise, has a social purview extending far beyond economic efficiency. By disparaging the role of the state, the neoliberal ideology aggravates socioeconomic inequality and foments tensions. The solution, in Fukuyama’s opinion, is not abandoning liberalism but only moderating its excesses to return to a rejuvenated liberal centrism.

 

 

 

 

6. LIBERALISM: A CRITICAL APPRAISAL

Notwithstanding Fukuyama’s attempt to dissociate neoliberalism from liberalism, the former is, demonstrably, a direct descendant of liberalism proper. As an elaborate political doctrine, liberalism of the nineteenth century was based upon ideas developed during the previous three hundred years. These ideas emerged from the ashes of feudalism in Europe, which was followed by the growth of a capitalist society. Originally, liberal ideas were radical, and reflected the aspirations of the rising middle classes whose interests conflicted with those of the old aristocracy: they sought fundamental reform and even revolutionary change. The English, American and French Revolutions of the seventeenth and eighteenth centuries each embodied elements that were distinctively liberal. Liberals also supported the movement towards freedom of conscience in religion and questioned the authority of the established church Heywood (2012).

However, historical developments since the nineteenth century clearly influenced the nature of the liberal ideology. It changed as the rising middle classes succeeded in consolidating their political dominance. The radical edge of liberalism faded with successive liberal successes. Hence, liberalism became increasingly conservative, standing for the maintenance of the status quo of existing liberal institutions Heywood (2012).

Whereas early liberals were against state intervention in the lives of citizens, modern liberals argue that government should be responsible for delivering welfare provisions, as well as for managing, or at least regulating, the economy. This led to the branching out of two traditions within liberalism: classical liberalism and modern liberalism. Here lies the genesis—and consequent criticism—of contradictions and incoherence in key principles of liberalism Heywood (2012).

Classical liberalism is married to a variety of theories. Among these, the most prominent are utilitarianism, economic liberalism, social Darwinism, natural rights theory, and neoliberalism. Neoliberalism refers to the form of economic liberalism that has been revived since the 1970s. It is opposed to “big” government, a trend that was witnessed throughout a greater part of the twentieth century. It is a kind of market fundamentalism, whereby the market is viewed as superior to state or political control Heywood (2012).

The political and the economic dimensions of liberalism come closest in the ordoliberal discourse. Ordoliberalism emerged in the 1920s as a response to the economic crisis in Germany’s Weimar Republic Bonefeld (2012). Ordoliberals break away from the traditional liberals in their conception of the state. For them, a strong state, which can ensure social order, is the precondition for sustainable economic freedom. The fundamental question that ordoliberalism asks is: How do we sustain market liberty and promote enterprise under situations of economic shock, financial crisis, and political conditions of un-governability Bonefeld (2012)?

Rustow views laissez faire liberalism as superstitious belief in the ability of the market to self-regulate. Competition, he says, “appeals... solely to selfishness” and is therefore “dependent on ethical and social forces of coherence”, a fact liberalism is able to neither recognize nor organize. In other words, laissez faire liberalism fails to address the problem of social integration Bonefeld (2012). While Müller-Armack finds a solution to this problem of cohesion in the myth of the nation which unites the movement and leader, Röpke finds it in a true social policy which empowers people in the use of economic freedom and thus does “away with the proletariat itself” Bonefeld (2012). The surge in militarization of work, economic servitude and mass living quarters are inherent to capitalism Bonefeld (2012). Thus, in a way, ordoliberals themselves expose some of the most fundamental problems associated with the neoliberal rhetoric.

Their answer to the crisis of the Weimar Republic is a commissarial dictatorship to be led by the elites who are the “aristocrats of public spirit” and act as a countervailing force against the masses Bonefeld (2012). This contradicts the very historical conditions within which liberalism arose in the nineteenth century: as a movement of thought and action of the middle classes against the old aristocracy. Although liberalism is often seen as a doctrine that favours and promotes democracy, ordoliberals are not very keen on a democracy as they see democratic decisions to be a compromise with rationality. They concur, however, that if there has to be a democracy it needs to be restricted by checks and balances to prevent the revolt of the masses. Furthermore, though ordoliberals support growth, they do not view it only in numerical terms. Instead, they view the crisis of capitalism as a crisis of the state which fails to protect the growth of entrepreneurs. As the state succumbs to class specific demands and becomes an unlimited democracy, human economy and freedom are compromised Bonefeld (2012).

Even if one tries to understand and rationalize the neoliberal state through such a state’s economic strategies, one would indeed observe great contradictions and incoherence within liberal thought itself. While Buchanan believes in a subjectivist moral universe, such that only the idea of contract can rationalize the liberal state, Hayek sees constitutional laws as having no utilitarian purpose: rules have emerged over the course of everyday interactions among people and the same are later codified into a constitutional framework, which ultimately aids people to pursue their own needs. In fact, Buchanan explicitly accepts bribery as one of the ways in which unanimity can be achieved Sivaramakrishnan (2010).

Nozick, on the other hand, lays enormous emphasis on the inviolability of individual personhood, hence the primacy of negative rights. Thus, for him even taxation for social ends is not permissible. However, one concept these liberal philosophers take for granted is “consent” and the ability to give it Sivaramakrishnan (2010). They fail to accommodate the possibility that even a seemingly free individual may be under structural constraints which govern her agency. Neither Nozick nor Hayek deals satisfactorily with the issues of intention, coercion, and capacity Sivaramakrishnan (2010), which inflect the so-called personhood of every human subject in the real world. Neoliberals fail to see the link between freedom and ability. The likes of Nozick take the autonomy of the human subject as given, but fail to account for the preconditions for that autonomy: Is a starving or sick person really free and autonomous? If not, then the neoliberal distinction between negative and positive rights collapses Sivaramakrishnan (2010).

Instances such as the above substantiate, to some extent, a criticism levelled at the liberal project: that it is an empirical failure.

There are other huge differences in the form of state that different neoliberal scholars envisage. Hayek approves of a minimum welfare safety net provided by collective—even state—action, and accepts likely expansion of this net as a society increasingly prospers. On the other hand, Nozick rejects provision of this kind, leaving any such to voluntary action like charitable donation, and Rothbard maintains that individuals improve their own positions by gaining goods through free exchange with others Sivaramakrishnan (2010).

Moreover, there is only a little unique and exclusive space for neoliberal doctrine. The only real space for neoliberalism is that occupied on the fringe by the radical version of Nozick who, however, is generally identified as a libertarian rather than a neoliberal. The rest of the space it tries to occupy is already filled by social democracy Sivaramakrishnan (2010). An example of the latter space is the welfare argument of Hayek.

Hayek is also very clear that planning is misconceived, because none of us can know the aggregate outcome of our actions in the market. He, however, questions whether we should tell the truth about the market, the implication being that if we do, then people will lose the incentive to work. Thus, “Hayek’s market can only be sustained with a global lie” Sivaramakrishnan (2010).

Liberal optimism of the late twentieth and early twenty-first century needs to be weighed against the emergence of new hurdles compelling liberals to reconsider their perspectives. Liberal ideology is, in fact, demoralized, evident in the increasing hesitation of liberals to generalize their views. Today, challenges facing liberalism have multiple sources, but, they converge in the recognition of the significance of diversity or difference Heywood (2012). This “diversity” is often framed in terms of group-membership.

National identity has been an exception: “cultural liberals” such as Kymlicka argue that autonomy requires recognition and preservation of national culture, which he differentiates from other types of group membership. Comparing the role played by other social groups in constructing individual identity to that of national groupings, one finds no fundamental difference between them. Smits argues that “liberal autonomy requires the local recognition of multiple group membership, rather than the exclusive privileging of nationality” Smits (2003).

On the financial front, following the 2008 financial crisis, neoliberalism’s inherent contradictions became more starkly visible than ever before. Global financial assets, in 2007, totalled $595.3 trillion, or eleven times the world's annual output, and the vast associated profits are made not from using money, but by managing it. Thus, all major economies have been financialized; almost all life has been commodified Sivaramakrishnan (2011). What is striking is the fact that a large fraction of the GDP of states contributes not towards the welfare of the citizenry, but towards the rescue of failing banks, as it happened during the 2008 crisis. Also, far from the neutrality often claimed by neoliberalism, it is highly moral and political, built on an epistemological edifice constructed by pioneering neoliberal scholars such as Hayek. This can be seen in neoliberalism’s case for strict implementation of Intellectual Property Rights, for which there exists no economic case. Also, its market mechanisms like carbon trading only dodge the fundamental ecological issues of pollution and depletion of fossil fuels Sivaramakrishnan (2011).

What one can certainly say about liberalism is that there is a vast gulf between what it claims and how those claims translate on the ground. Let alone liberalism enabling democracy, growth and equality, there is no clear agreement among liberals themselves when it comes to formulating and framing standpoints concerning these narratives.

 

7. FIVE WAVES OF LIBERALISM

The critical survey of divergent views within liberalism has revealed a spectrum of philosophies and internal inconsistencies. However, despite any apparent discontinuity among these perspectives, they mutually share strong conceptual and historical relationships, with each movement being a logical successor of an earlier one. Classical liberalism emerged in the seventeenth century in the power struggle of the middle classes against feudal elites. Hence, it is not entirely dismissive of private property or the state. As an ideology, classical liberalism emphasizes individual liberty, free markets, limited government, and the rule of law. These principles are rooted in the Enlightenment movement to protect freedom of religion and speech, and guard ownership of property from state overreach. The primary role of the state is to secure these fundamental liberties.

The foremost classical liberals were the likes of John Locke and Adam Smith. Notably, classical liberalism acted as the ideological engine for the Industrial Revolution (roughly 1760–1850) by promoting free markets, private property, and limited state intervention. Dismantling mercantilist and feudal restrictions, this framework is thought to have encouraged entrepreneurship, trade, investment, and innovation, thus driving rapid economic growth Britannica Editors (2026).

By the 1850s, however, realization of inequalities and inequities of the industrial era began setting in. Hence, modern (social) liberalism arose, accepting greater state intervention for the sake of social welfare. John Stuart Mill is considered a transitional figure whose thought bridged the classical and modern forms of liberalism. While rooted in classical principles of utilitarianism and free-market, he later promoted intervention by the state, redistribution of wealth, and worker cooperatives. This makes him a pioneer of the social reformism that characterizes much of modern liberalism.

Modern liberalism, as a political philosophy, evolved from classical liberalism, advocating state intervention to ensure equality, justice, and protection of citizens. Thus, it moved beyond mere negative liberty (freedom from restraint) to positive liberty (the capability to achieve one's potential) through social safety, regulated economies, and support for the marginalized segments of the citizenry. Key thinkers of modern liberalism include T.H. Green, John Maynard Keynes, John Rawls, and Amartya Sen. Modern liberalism reached its zenith during the New Deal era (1933-38) under American President Franklin Roosevelt. The New Deal comprised a series of sweeping government programs and reforms designed to combat impacts of the Great Depression through the "Three Rs" (Relief, Recovery, Reform). It dramatically expanded federal purview, creating jobs, infrastructure, social safety nets, and financial regulations, with a view to stabilize the economy and prevent future economic crises.

Parallel to the rise of social liberalism in the Anglo-American world, another wave of liberalism—namely, ordoliberalism—was emerging in the German empire during the 1930s. This movement was a response to the crisis in the Weimar Republic. Ordoliberals envisioned a kind of middle path between laissez faire capitalism and socialist planning. With social liberals, they shared the belief that markets require an institutional and regulatory framework. They called it “Ordnungspolitik”, imposed by a strong state in order to maintain a privilege-free, competitive market. Alfred Müller-Armack, one of the most prominent ordoliberal thinkers, also proposed a social market economy (“Soziale Marktwirtschaft”) in post-war Germany. However, unlike the social liberals who promoted redistribution by a welfare state, the “social” aspect of the ordoliberal social market economy was defined as producing social benefits through competition and market efficiency. Founders of ordoliberalism include scholars like Walter Eucken, Alexander Rüstow, and Wilhelm Röpke.

Back in the Anglosphere, as the “New Deal Order” (1930s-70s)—characterized by heightened state intervention and labour welfare—reached its peak, two ideological movements arose in opposition to this order. These were libertarianism and neoliberalism. Both were vehemently opposed to Keynesianism and Rawlsianism. Keynesianism, named after the English economist John Maynard Keynes, is an economic theory focused on macroeconomic stability. It postulates that government intervention, by means of fiscal and monetary policy, is essential to managing demand, preventing recession, and ensuring full employment. Rawlsianism, on the other hand, is a theory emphasizing distributive justice. Named after the American political philosopher John Rawls, it posits that a just society is one that structures its institutions with the goal of ensuring equal, basic liberties for all, and that social-economic inequalities must benefit the least advantaged members of society (the difference principle) by ensuring fair equality of opportunity.

Although the term “libertarian” was first used in nineteenth century France to describe anarchists, it was revived in twentieth century America by the likes of Albert Jay Nock and H.L. Mencken, two of the first Americans to identify as libertarian. For them, this term was synonymous with liberal. They believed that President Franklin D. Roosevelt had co-opted the term “liberal” for policies of the New Deal which they opposed. Hence, they instead used “libertarian” to signify their adherence to the principles of classical liberalism, that is, individualism and limited government. Libertarianism, today, is understood as a radical outgrowth of classical liberalism, which prioritizes liberty but differs on the role of the state. While classical liberalism envisaged a limited government for protecting rights and order, libertarianism views the state as an inherent threat to liberty. Therefore, libertarians seek to drastically minimize or even abolish its role, especially in matters of economic intervention. Instead, libertarians emphasize the primacy of absolute individual freedom and private contracts over public good.

In the 1930s, Albert Jay Nock was one of the fiercest critics of Franklin Roosevelt's New Deal. In Our Enemy, the State, Nock (1935) argued that the New Deal was only a pretext for the federal government to increase its stranglehold on society. Dismayed by the unprecedented power the President had accumulated, Nock called this situation a coup d'état. By the 1940s, Western democracies had dramatically expanded state involvement in the market. As a result, economists like Friedrich Hayek (1944) and Ludwig von Mises (1949) reasserted individualist principles. Subsequently, the next generation of libertarian thinkers, including Murray Rothbard, Milton Friedman, and Robert Nozick, formalized this worldview, advocating radical free markets and minimal government.

Friedrich Hayek was a central figure in whose work one sees an intersection of libertarianism and neoliberalism. He is considered a cornerstone of libertarianism due to his advocacy for property rights, radical free markets, and opposition to a command economy. While sometimes described as a “conservative”, Hayek identified as a classical liberal aiming to restore liberty rather than conserve a fixed, older state of affairs. Inspired by the Walter Lippman Colloquium where the term “neoliberalism” was coined, Hayek founded the Mont Pèlerin Society, an international forum for neoliberals that has continued to provide intellectual fodder for neoliberalism across the world. It is worth mentioning that among the 76 economic advisors on Ronald Reagan's 1980 presidential campaign staff, 22 were members of the Mont Pèlerin Society.

While working at the University of Chicago as a professor in the Committee on Social Thought, Hayek collaborated with colleagues from the Chicago school of economics, the leading school of neoclassical economics. Neoclassical economics is a theoretical framework that focuses on supply and demand, and consumer utility maximization. Neoliberalism, on the other hand, is a political-economic ideology that applies the neoclassical framework to advocate deregulation, privatization, free trade, and free markets. Neoliberals view individual economic freedom and market competition as the sine qua non for human progress and efficiency. Rooted in classical liberalism, this ideology rose to prominence during the economic stagnation of the 1970s, when unemployment and rising inflation challenged the Keynesian, interventionist policies that had ruled the roost since the New Deal. Neoliberals argued that this expansive, state-managed economy threatened economic efficiency and individual freedom. This reaction culminated in the 1980s with Margaret Thatcher in the U.K. and Ronald Reagan in the U.S., who went about dismantling the New Deal framework through tax cuts, deregulation, and reduction of the power of trade unions. For neoliberals, the market is superior to the government in resource allocation. Hence, the emphasis ought to be on individual responsibility and reduced welfare states.

At odds with Fukuyama's attempt to dissociate neoliberalism from liberalism, the above survey has revealed deep entanglements between the five variants of liberalism. Far from being discontinuous, successive ideological variants build upon or respond to predecessors. The successor emerges as a reaction to crises or perceived shortcomings in the predecessor. Furthermore, all of these forms of liberalism converge in the centrality they accord to the relation of structure (the state) with agency (of the human individual). For a liberal, irrespective of her ideological affiliation, the most consequential question is to what degree the state ought to play a role in the affairs of human individuals. Notwithstanding any desire to the contrary, the state cannot be wished away. What liberals ask, hence, is to what extent the state should intervene in the lives of its citizens. The state's role is most restricted in libertarianism, while it is most extensive in modern (social) liberalism.

Neoliberalism and libertarianism, both prioritize free markets and limited government. But there are significant differences when it comes to their approach to state power. While libertarianism seeks near-total abolition of state intervention in favour of liberty of the individual, neoliberalism adopts a constructivist approach by using state machinery to engineer—create, protect, regulate—markets through mechanisms like deregulation, privatization, and global trade agreements. The focus is on promoting economic growth, institutional stability, and technocratic efficiency.

On the whole, liberalism aims to balance individual agency—the capacity for autonomy, self-directed action, and choice—with an overarching structure of laws, rights, and markets that limit the power of the state. It emphasizes individualism, while structures like the market and the constitutional state are expected to create conditions that allow individual agents to pursue their goals. Thus, liberalism rests on the assumption that individual agents possess the capability to pursue rational, self-interested, and autonomous action. This assumption overlooks the possibility of such agency itself being tied to market forces, and neglects the role of social structures in shaping, limiting, or enabling “free” choices. The liberal market structure broke down in the 2008 financial crisis which resulted from decades of deregulation, financialization, and promotion of self-regulated markets. These policies were all based on the philosophical assumptions discussed above. By prioritizing free markets, capital mobility, and reduced state intervention, neoliberal policies enabled excessive speculation and the subprime mortgage collapse. While the crisis exposed flaws in this orthodoxy, it also led to massive state-led bailouts, reflecting a shift in how neoliberalism operates rather than its complete abandonment.

 

8. LIBERTARIAN PATERNALISM

The Panic of 2008 was sparked off by a series of irrationalities in human decision-making, driven by fear, greed, and cognitive biases rather than pure utility-maximization. The financial crisis, therefore, acted as a critical catalyst for the mainstream adoption of behavioural economics. This shift thoroughly challenged traditional economic models, leading to an increase in the use of behavioural insights (for example, nudges) in regulatory policy Dedu et al. (2011), Szyszka (2011).

The crisis exposed the shortcomings of the Homo economicus (rational agent) model as the latter failed to explain the irrational market behaviours, including overconfidence and herd mentality, which caused the crash. Behavioural drivers of the crisis included herding (following the herd into subprime mortgages), overconfidence (underestimating risk), and present bias (giving stronger weight to payoffs closer to the present time). Hence, the economic downturn accentuated the need for, and accelerated the development of, regulations that account for cognitive limitations of humans. Thus, behavioural approaches were legitimized as a practical tool for drafting and implementing policies.

Behavioural economics emerged in the second half of the twentieth century, when the American cognitive psychologist Herbert Simon saw the possibility of merging the disciplines of cognitive psychology and economics. Simon (1978) noted,

“The classical theory of omniscient rationality is strikingly simple and beautiful. Moreover, it allows us to predict (correctly or not) human behavior without stirring out of our armchairs to observe what such behavior is like. All the predictive power comes from characterizing the shape of the environment in which the behavior takes place. The environment, combined with the assumptions of perfect rationality, fully determines the behavior. Behavioral theories of rational choice - theories of bounded rationality - do not have this kind of simplicity. But, by way of compensation, their assumptions about human capabilities are far weaker than those of the classical theory. Thus, they make modest and realistic demands on the knowledge and computational abilities of the human agents, but they also fail to predict that those agents will equate costs and returns at the margin.”

Simon introduced the concept of satisficing, a portmanteau of the words “satisfy” and “suffice”, to refer to a strategy where human decision-makers settle for a “good enough” option instead of the optimal one. Accounting for bounded rationality, this concept recognizes that cognitive limitations, information scarcity, and time constraints prevent perfect optimization. Providing a rigorous empirical grounding to this new approach, psychologists Amos Tversky and Kahneman (1974) furnished examples of psychological experiments where classical utility theory broke down. Five years later, Kahneman and Tversky (1979) introduced a mathematical model of decision-making, which could account for cognitive biases such as uncertainty avoidance and loss aversion.

Nearly three decades later, in the early stages of the 2008 financial crisis, economist Richard Thaler and legal scholar Cass Sunstein published a landmark work in behavioural economics titled Nudge: Improving Decisions About Health, Wealth, and Happiness Thaler and Sunstein (2008). The authors define a nudge as “any aspect of the choice architecture that alters people's behavior in a predictable way without forbidding any options or significantly changing their economic incentives.” Here, choice architecture is the environment wherein people make decisions. The one who designs the environment to influence outcomes is called the choice architect. Kahneman (2011) delineated two distinct systems of processing information to explain why people sometimes act against their own self-interest: System 1 is fast, automatic, and highly susceptible to environmental influences, while System 2 is slow, reflective, and takes into account explicit goals and intentions. Since System 1 processing, which relies on various judgmental heuristics to make quick decisions, can also lead to sub-optimal choices, a nudge alters the environment so that when System 1 decision-making is used, the resulting choice will be the desired outcome. In summary, Nudge is based on four premises: (1) the choice architecture profoundly influences human choice-making; (2) this architecture is inescapable; (3) it can and should be designed in a way that promotes human well-being; and (4) liberty to choose (agency) can exist within a choice architecture (structure) constituted by paternalistic nudges. Thaler and Sunstein call this political philosophy “libertarian paternalism” Thaler and Sunstein (2008).

Given that a central concern of nudge theory is to unsuspectingly bring agency (human autonomy) to terms with structure (choice architecture), one might be tempted to view the philosophy of “libertarian paternalism” as the sixth and latest wave of liberalism, which has succeeded neoliberalism. On a closer look, however, it becomes clear that behavioural economics, at its core, is more paternalistic than libertarian, aiming to tame the unruly, uncomputable, “misbehaving” human within an epistemic cage of behavioural strategy. Unlike the five schools of liberalism discussed earlier—each of which sought to balance structure with agency—libertarian paternalism seeks to acquiesce human autonomy to a position of inevitable subservience to the structure of the choice architecture. Also, more than the mind, it is the body of the human that behavioural economics concerns itself with. The free mind is rational, but the brain, constrained by nervous tissue and blood vessels, is doomed to be bounded. Hence, its decisions must be carefully steered towards the desired direction. This direction, though, is that of the cold, calculative, rational, and possibly, disembodied Homo economicus—perpetually under the disciplined control of System 2 thinking. Put simply, behavioural nudges are focused on casting bodily behaviour in a liberal mold. Behavioural economics, then, is nothing more than a strategic tool of (neo)liberalism to contain the potentially subversive body.

Such governmentality could very well be read as an exertion of biopower over the human. Biopower was a concept coined by the French philosopher Michel Foucault (1976) to refer to the strategies and mechanisms whereby modern states and their institutions exercise control over their populations through management of health, life, and biological processes in general. Such power operates by regulating bodies through surveillance and normalization rather than outright, coercive force. This form of power “fosters life or disallows it to the point of death”, focusing on both, the individual body as a machine (anatomopolitics) and the body politic as a population (biopolitics).

The centrality of the body to behavioural economics is evidenced by the fact that the very notion of bounded rationality is founded on the premise that the human brain has finite cognitive abilities which limit the quantity of information that can be stored and processed at a given time. This affects human decision-making by placing boundaries on the amount of information that a person can analyze to arrive at a decision. Human behaviour is directly influenced by the heuristics (mental shortcuts) one uses to manage such mental constraints. As one encounters increasingly complex scenarios, the likelihood of these heuristics resulting in suboptimal choices increases Bendor (2002).

Behaviourism's focus on the body over the mind can be traced to John B. Watson, the founder of the behaviourist school of psychology. Watson defined psychology as an objective and experimental science concerned with observable, measurable, external behaviour—not internal mental states—as its sole subject matter. These external behaviours included motor responses, vocalizations, and visceral reactions. Thus, he rejected introspection in favour of observation. He also understood behaviour as simply a response to stimuli. Hence, he believed that psychology should control and predict behaviour by analyzing the relationship between environmental stimuli (S) and the organism's glandular or muscular responses (R). This model, he maintained, could explain all mental phenomena. Thus, for Watson, every mental phenomenon could be reduced to physical processes and states. He also famously believed that thinking was not a mental act, but, largely, subvocal speech involving minute movements of the vocal apparatus Sengupta (2017). He wrote,

 “Thinking is then largely a verbal process; occasionally expressive movements substitutable for word movements (gestures, attitudes, etc.) enter in as a part of the general stream of implicit activity” Watson (1920).

The Watsonian emphasis on empiricism (observable insights) continues to shape the trajectory of behavioural economics. Economist William J. Congdon and behavioural scientist Maya Shankar have argued that

 “[T]he continued relevance of behavioural economics for policy is, in no small part, a result of the deep underlying relationship between behavioural economic policy and evidence-based policy. Behavioral economics is, at its core, about taking an empirical approach to human behavior when conducting economic analysis and making economic policy” Congdon and Shankar (2018).

Behavioural governance of the body through nudges has found applications across domains ranging from public health promotion to energy conservation. The following are a few examples:

·        Placing fruit bowls at eye level in school cafeterias to promote nutrition among children.

·        Designing environmental cues—such as visual posters, painted footsteps leading to sinks, and soap-dish arrows—to increase propensity to wash hands.

·        Designing musical (piano) stairs to encourage their use over elevators or escalators.

·        Showing energy consumption reports to customers of utility companies to let them compare their energy usage with that of their neighbours.

Since the Great Recession, governments and institutions across the world have enthusiastically adopted behavioural economics as a policy paradigm. In 2010, a Behavioural Insights Team (BIT) was set up within the Cabinet Office of the Government of the United Kingdom with the aim of applying nudge theory in government policy. In 2014, BIT was expanded into a limited company. Today, it works in more than 95 countries, with offices across Asia Pacific, Europe, and North and South America. Till date, it has delivered more than 1800 projects around the world. BIT is unofficially called the “Nudge Unit”, and has also played an important role in dealing with the COVID-19 crisis. During the COVID-19 pandemic, David Halpern, the President of the Nudge Unit, was named by the UK government as one of the participants of the Scientific Advisory Group for Emergencies (SAGE). In September 2015, the then-President of the U.S., Barack Obama, directed federal agencies in the U.S. to include behavioural science-based insights in policymaking. A Social and Behavioral Sciences Team (SBST) was also created for this purpose. Furthermore, from 2009 to 2012, Cass Sunstein, one of the authors of Nudge, served as the administrator of the White House Office of Information and Regulatory Affairs. Behavioural interventions are also being widely adopted as a tool in international development cooperation. International organizations and NGOs use these instruments to address “last-mile” roadblocks, where available services are not (fully) utilized. The World Bank's Mind, Behavior, and Development Unit (eMBeD) integrates behavioural science in development projects, while the United Nations Behavioural Science Group, connecting over 6,000 members from more than 70 UN entities, aims to integrate behavioural insights into UN policies and programmes.

It has now been illustrated that far from being a variant of the liberal ideology, libertarian paternalism is merely a policy tool of neoliberal governments and institutions to order disorderly bodies. Contrary to liberalism’s emphasis on the rational mind and the autonomous—often disembodied—individual, libertarian paternalism emphasizes the body and the inevitability of its governance through (subservience to) the structural environment encasing it. The intended direction of behavioural nudges, though, is that of the liberal archetype. This is due to the enduring dominance of liberalism in policymaking. In the aftermath of the 2008 financial crisis, the incumbent political-economic order simply appropriated behavioural economics as a methodological paradigm. The rise of behavioural economics does not, in any way, reflect a shift from the neoliberal regime. Rather, the popularity of behavioural economics is due, largely, to the complementary relationship it shares with neoliberalism.

Adams et al. (2019) write,

“[P]sychological science is not just an observer of neoliberalism and its impact on psychological experience. Instead, by studying psychological processes independent of cultural-ecological or historical context and by championing individual growth and affective regulation as the key to optimal well-being, psychological scientists reproduce and reinforce the influence and authority of neoliberal systems. Rather than a disinterested bystander, hegemonic forms of psychological science are thoroughly implicated in the neoliberal project.”

Given the worldwide popularity of behavioural interventions as tools of betterment, behavioural science clearly qualifies as a hegemonic form of psychological science. Scholars have held neoliberalism responsible for the undue reliance of behavioural scientists on individual-level interventions as opposed to system-level change Andreas and Jabakhanji (2023). This focus on the i-frame has led behavioural scientists to frame disease as an individual problem, thus unwittingly favouring corporations and hindering systemic (s-frame) change Chater and Loewenstein (2022). M. (2025) explains the neoliberalization of the public health system. The public health system operates under a framework of neoliberal rationality, as expressed in the techniques of benchmarking, governance, devolution, and responsibilization. At the same time, due to the belief that human behaviour affects health outcomes, behavioural science is increasingly being used to address public health concerns. Hence, behavioural science research meant to address public health issues is deeply influenced by the overarching ideology of neoliberalism. Responsibilization of public health has placed the onus of managing one's health squarely on the individual citizen who, now, is viewed as a consumer purchasing a service. Responsibility for health issues has, thus, shifted from the state to individuals. Practising healthy behaviour is now a personal responsibility. Behavioural science, therefore, fails to address the larger political-economic context that shapes health behaviour. Addressing the neoliberal context is important because social psychologists have experimentally discovered that neoliberalism appears to be detrimental to health in that “it can create a sense of being disconnected from others, as well as being in competition with them, in ways that feed feelings of loneliness and social isolation” Becker et al. (2021).

The present section has explained the rise of behavioural economics in the liberal global order. In the wake of the 2008 financial crisis, governments were actively looking for avenues to pull their economies out of the abyss. At this critical juncture, behavioural economics emerged as a potential saviour or the go-to policy paradigm for governments and institutions. There were, arguably, five main reasons behind this embrace of behavioural economics by policymakers at this specific moment: (1) Knowledge of the fact that the financial crisis was largely caused by irrational market behaviours; (2) Emergence, right at this juncture, of easily applicable behavioural interventions like nudges; (3) Possibility of governing bodies through behavioural interventions; (4) Palatability of behavioural economics projects to the state exchequers due to the empirical—evidence-based and demonstrable—nature of behaviourist methods; and (5) Complementarity between the methodology of behavioural science and the ideology of neoliberalism.

 

9. CONCLUSION

This paper began with a discussion on the growing instrumentalization of art under the liberal regime. It, then, zoomed in on the role of the performing arts and the body in offering resistance to this ideological drive. In order to understand the nature of the liberal global order, the subsequent sections elucidated the liberal political economy, while historicizing the rise and fall of successive waves of liberalism. Finally, libertarian paternalism—as expressed through behavioural interventions like nudges—was shown to be the latest tool adopted by neoliberal policymakers to rationalize the irrational body and steer its behaviour towards the archetypical Homo economicus. This embrace of behavioural economics prevented liberalism's demise in the wake of the 2008 financial crisis by making neoliberal policies appear as though they promote human autonomy while embracing human irrationalities. On the contrary, however, libertarian paternalism subordinates human agency to the structural environment while manipulating human behaviour to resemble or mirror that of the Homo economicus. The methodological frame of behavioural science is itself subject to neoliberal rationality, thereby precluding the possibility of discursive or structural transformation.

Against this strategic appropriation of the body by the liberal global order, it is well worth wondering what possibilities remain for the human. The body has stood the test of time as the primary subject of the (performing) arts: one which projects, and is a projection of, human imagination. The present epoch has come to be defined by intensifying datafication of every realm of human existence, including the arts. It remains to be seen if and how the body—and by extension, the human—survives this technoeconomic onslaught. And as the foundation of the liberal global order itself is shaken in a fractured world, the verdict remains open on the future of liberalism. Will this order succeed in (re)shaping the human in the image of the Homo economicus, or will the crises in this order give way to a new political economy? Only time will tell.

 

CONFLICT OF INTERESTS

None. 

 

ACKNOWLEDGMENTS

None.

 

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