Why Liberalism Failed

by Patrick J. Deneen

By 2008, the financial industry was stripped bare of any such culture rooted in nature, time and place—as were college campuses. Indeed, training at dorm parties and the fraternities of one’s college were the ideal preparation for a career in the mortgage bond market, and the financial frat party of Wall Street more generally. The mortgage industry rested upon the financial equivalent of college “hookups,” random encounters of strangers in which appetites (for outsized debt or interest) were sated without any care for the consequences for the wider community. Responsibility- and cost-free loans were mutually satisfactory and wholly liberating from the constraints of an older financial order. But much as on college campuses, these arrangements led to gross irresponsibility and abuse, damaging communities and demolishing lives. The response has been the same: calls for greater government regulation and oversight over the consequences of untrammeled appetite, with threats of penalties (rarely enforced) and a massive expansion of the administrative state to oversee a basic human interaction—the effort to secure shelter. Liberation from the confinements and limitations of local market cultures brings not perfect liberty but the expansion of Leviathan. The destruction of culture achieves not liberation but powerlessness and bondage.