All change is disruptive. We have seen that the specter of terrorism is enough to cast stable democracies into turmoil. Climate change will have even more dramatic consequences. Men and women will be thrown back upon the resources of the state. They will look to their political leaders and representatives to protect them: open societies will once again be urged to close in upon themselves, sacrificing freedom for ‘security’. The choice will no longer be between the state and the market, but between two sorts of state. It is thus incumbent upon us to re-conceive the role of government. If we do not, others will.

It should be clear from this narrative that there is little to be gained from asking 'who started the Cold War?' To the extent that the Cold War was about Germany, the final outcome—a divided country—was probably preferred by all parties to a Germany united against them. No one planned this outcome in May 1945, but few were deeply discontented with it.

In the past, the social cost of economic change on this scale, and at this pace, would have been traumatic, with unpredictable political consequences. Thanks to the institutions of the welfare state—and perhaps the diminished political enthusiasms of the time—protest was contained. But it was far from absent. In the years 1969-1975 there were angry marches, sit-ins, strikes and petitions all across industrial Western Europe, from Spain (where 1.5 million days were lost to industrial strikes in the years 1973-75) to Britain, where two major strikes by coalminers—in 1972 and 1974—persuaded a nervous Conservative government that it might be the better part of valor to postpone major mine closures for a few more years, even at the cost of further subsidies charged to the population at large.

The economic history of post-war western Europe is best understood as an inversion of the story of the immediately preceding decades. The 1930s Malthusian emphasis on protection and retrenchment was abandoned in favor of liberalized trade. Instead of cutting their expenditure and budgets, governments increased them. Almost everywhere there was a sustained commitment to long-term public and private investment in infrastructure and machinery; older factories and equipment were updated or replaced, with attendant gains in efficiency and productivity; there was a marked increase in international trade; and an employed and youthful population demanded and could afford an expanding range of goods.
The post-war economic ‘boom’ differed slightly in its timing from place to place, coming first to Germany and Britain and only a little later to France and Italy; and it was experienced differently according to national variations in taxation, public expenditure or investment emphasis. The initial outlays of most post-war governments went above all on infrastructure modernization—the building or upgrading of roads, railways, houses and factories. Consumer spending in some countries was deliberately held back, with the result—as we have seen—that many people experienced the first post-war years as a time of continuing, if modified, penury. The degree of relative change also depended, of course, on the point of departure: the wealthier the country, the less immediate and dramatic it seemed.

But the Derrida-Habermas initiative, even though it articulated sentiments shared by many Europeans, passed virtually unnoticed. It was not reported as news, nor was it quoted by sympathizers. No-one implored its authors to take up their pens and lead the way forward. The governments of a significant number of European states, including France, Germany, Belgium and later Spain, undoubtedly sympathized in general terms with the views expressed in these essays; but it did not occur to any of them to invite Professors Derrida or Eco in for consultation. The whole project sputtered out. One hundred years after the Dreyfus Affair, fifty years after the apotheosis of Jean-Paul Sartre, Europe’s leading intellectuals had thrown a petition—and no-one came.

This paradox—that a peaceful European settlement was taking shape even as the two Great Powers of the day were arming themselves to the hilt and preparing for the eventuality of a thermonuclear war—was not so bizarre as it might appear. The growing emphasis in US and Soviet strategic thinking on nuclear weapons, and the intercontinental missiles with which to deliver them, released European states from the need to compete in an arena where they could not hope to match the resources of the superpowers, even though central Europe remained the most likely terrain over which any future war might be fought. For this reason, the Cold War in Western Europe was experienced quite differently in these years from the way it was felt in the United States, or indeed in the USSR.

Economic liberalization did not signal the fall of the welfare state, nor even its terminal decline, notwithstanding the hopes of its theorists. It did, though, illustrate a seismic shift in the allocation of resources and initiative from public to private sectors. This change went far beyond the technical question of who owned which factories, or how much regulation there was to be in any given industry. For nearly half a century Europeans had watched the state, and public authorities, play a steadily more prominent part in their affairs. This process had become so commonplace that the premise behind it—that the activist state was a necessary condition of economic growth and social amelioration—was largely taken for granted. Without the cumulative unraveling of this assumption in the course of the waning decades of the century, neither Thatcherism nor the Mitterrand volte-face would have been possible.

But it is symptomatic of the fundamentally apolitical mood of May 1968 that the best-selling French books on the subject a generation later are not serious works of historical analysis, much less the earnest doctrinal tracts of the time, but collections of contemporary graffiti and slogans. Culled from the walls, noticeboards and streets of the city, these witty one-liners encourage young people to make love, have fun, mock those in authority, generally do what feels good—and change the world almost as a by-product.

The case for reviving the state does not rest uniquely upon its contributions to modern society as a collective project; there is a more urgent consideration. We have entered an age of fear. Insecurity is once again an active ingredient of political life in Western democracies. Insecurity born of terrorism, of course; but also, and more insidiously, fear of the uncontrollable speed of change, fear of the loss of employment, fear of losing ground to others in an increasingly unequal distribution of resources, fear of losing control of the circumstances and routines of our daily life. And, perhaps above all, fear that it is not just we who can no longer shape our lives but that those in authority have also lost control, to forces beyond their reach.

The three quarters of century that followed Austria’s collapse in the 1930s can be seen as a duel between Keynes and Hayek. Keynes, as I was saying, begins with the observation that under conditions of economic uncertainty we would be imprudent to assume stable outcomes and therefore had better devise ways to intervene in order to bring these about. Hayek, writing quite consciously against Keynes and from the Austrian experience, argues in the The Road to Serfdom that intervention—planning, however benevolent or well-intentioned and whatever the political context—must end badly. His book was published in 1945 and is most remarkable for its prediction that the post–World War II British welfare state already in the making should anticipate a fate similar to that of the socialist experiment in post-1918 Vienna. Starting with socialist planning, you would end with Hitler or a comparable successor. For Hayek, in short, the lesson of Austria and indeed the disaster of interwar Europe at large boiled down to this: don’t intervene, and don’t plan. Planning hands the initiative to those who would, in the end, destroy society (and the economy) to the benefit of the state. Three quarters of a century later, this remains for many people (especially here in the U.S.) the salient moral lesson of the twentieth century.

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Something is profoundly wrong with the way we live today. For thirty years we have made a virtue out of the pursuit of material self-interest: indeed, this very pursuit now constitutes whatever remains of our sense of collective purpose. We know what things cost but have no idea what they are worth. We no longer ask of a judicial ruling or a legislative act: is it good? Is it fair? Is it just? Is it right? Will it help bring about a better society or a better world? Those used to be the political questions, even if they invited no easy answers. We must learn once again to pose them.

It is the liberals, then, who count. They are, as it might be, the canaries in the sulphurous mineshaft of modern democracy. The alacrity with which many of America's most prominent liberals have censored themselves in the name of the War on Terror, the enthusiasm with which they have invented ideological and moral cover for war and war crimes and proffered that cover to their political enemies: all this is a bad sign. Liberal intellectuals used to be distinguished precisely by their efforts to think for themselves, rather than in the service of others. Intellectuals should not be smugly theorising endless war, much less confidently promoting and excusing it. They should be engaged in disturbing the peace – their own above all.

The cultural competition of the early Cold War years was asymmetrical. Among European cultural elites there was still a widespread sentiment that they shared, across ideological divides and even bridging the Iron Curtain, a common culture to which America posed a threat. The French in particular took this line, echoing the early post-war efforts of their diplomats to trace an international policy independent of American control.