ItalianThe Political Theory of Luigi Einaudi
by Alberto Giordano
1. Introduction: Luigi Einaudi and Liberalism
Luigi Einaudi stands among the few Italian liberals revered within the Pantheon of European political thought. But what did liberalism mean to him? For the moment we can only outline a general definition reflecting his lifelong conviction: liberalism is “the doctrine of those who prioritise the advancement and elevation of the human person above all else...a moral doctrine, transcending the contingencies of time and place” (Liberalism, L'Italia e il secondo Risorgimento, 29 July 1944; in Riflessioni di un liberale sulla democrazia 1943-1947, ed. P. Soddu, Florence, Olschki, 2001, p. 65).
Even a purely moral doctrine, however, requires institutional embodiment. Politically, Einaudi asserted, “liberalism is a doctrine of limits,” maintaining that democracy becomes liberal only when the majority refrains from coercing individuals in realms deemed inviolable by the moral order—“a domain sacred to the person” (ibid., pp. 65-66).
Economically, while Einaudi saw no inherent link between liberalism and economic structures (ibid., p. 66), he firmly
believed that a liberal and democratic society necessitates substantial economic freedom—granting individuals autonomy
as savers, consumers, and producers:
"Liberals deny that human freedom stems from economic freedom; that the latter is the cause and moral, spiritual, and
political freedoms its effects. A morally free society, grounded in respect for human dignity, creates economic
institutions in its own image. Machines enslave only those who submit to enslavement. There is indeed a connection
between economic freedom and broader liberties, including political freedom, but it is far subtler than commonly
asserted in propaganda” (Il nuovo liberalismo, La Città Libera, I, 1945, no. 1; in Riflessioni di un liberale sulla democrazia, cit., pp.
119-120).
2. The Roots of Einaudian Thought
Einaudi drew deeply from the great classics of the liberal tradition, including David Hume, Adam Smith, Alexander Hamilton, and James Madison, as well as Italian thinkers like Carlo Cattaneo and Francesco Ferrara, and figures such as Benjamin Constant and Alexis de Tocqueville. Among his contemporaries, he engaged in meaningful dialogue with Benedetto Croce, Gaetano Mosca, Vilfredo Pareto, and Maffeo Pantaleoni, as well as international scholars like Lionel Robbins, Wilhelm Röpke, and Friedrich von Hayek. Einaudi, in turn, exerted a profound influence on key Italian economists and political thinkers of the 20th century, including Carlo Rosselli, Ernesto Rossi, Piero Gobetti, Costantino Bresciani Turroni, and Bruno Leoni.
While his intellectual influences were diverse or even unorthodox—admiring figures as disparate as the idealist Thomas Carlyle and the socialist Charles Fourier—Einaudi never made a mystery of considering England as his political and cultural ideal homeland. In a celebrated essay, he referred to himself as a “passionate, almost monomaniacal reader of English books” (Germanofili ed anglofili, La Riforma Sociale, XXIII, vol. XXVII, 1916; in Gli ideali di un economista, Florence, Edizioni de La Voce, 1921, p. 153).
Adam Smith was particularly inspiring to him. Einaudi composed evocative essays examining Smith's reception in Italy and analysing specific themes contained in unpublished chapters from the early drafts of The Wealth of Nations (1763). To Einaudi, Smith epitomised the liberal thinker attentive to the ethical and political dimensions of economics. While an advocate of competition, Smith also championed robust anti-monopoly policies and severely criticised some shortcomings of the market even though he is being viewed still today as the greatest prophet by collective imagination.
Smith's pluralistic approach to scholarship, combining “moral, historical, and economic judgements (Di una prima stesura della ‘Ricchezza delle Nazioni’ e di alcune tesi di Adamo Smith intorno alle attribuzioni dei frutti del lavoro, «Rivista di storia economica», III, 1938, n. 1, now in Id., Saggi bibliografici e storici intorno alle dottrine economiche, Rome, Edizioni di Storia e Letteratura, 1953, p. 101). More importantly, Smith in his dual capacity of philosopher and economist both authored The Wealth of Nations and The Theory of Moral Sentiments achieving widespread recognition across Europe, including Italy, by the late 18th century. His ability to bridge between diverse theoretical domains, and more often than not after dwelling upon 'historically ascertained and economically analysed facts' he called upon the “moralist so alive in him” to correlate the ethical and the economic planes (ibid.).
Einaudi shared much intellectual ground with John Stuart Mill. Both were eminent economists, acute observers of
socialism and the labour movement, and prominent figures in European liberalism, holding significant political roles.
Einaudi, as we shall explore further, drew on Mill’s antagonistic view of progress and freedom. In 1925, amid
Mussolini’s consolidation of power following his infamous speech of 3 January where he had taken responsibility for
Matteoti murder and the disintegration of the Aventine secession, Einaudi invoked Mill’s principles in a striking and
significant tribute. In the inspired preface to Gobetti’s new Italian edition of On Liberty, Einaudi urged resistance to
the encroaching dictatorship:
“The Syllabus of errors, conformism, concord, and regressive press laws signal civil decay. Conversely, partisan
struggles, criticism, non-conformism, and press freedom herald the ascent of peoples and nations. The years of imposed
consensus from which Italians are painstakingly emerging have rekindled their appreciation of discord as a right and a
benefit. They feel that freedom is not merely a tool but a shared end upon which all other civil, political, and
spiritual aims depend. Yet this is perhaps more a sentiment than a firmly rooted conviction. Mill’s essay, once favoured
by our elders, thus reappears at an opportune moment for Italians who are now anxiously seeking to define the
foundations and limits of freedom" (Preface to J. S. Mill, La libertà, Turin, Piero Gobetti Editore, 1925, pp. vii-viii).
For Einaudi, the primary role of a liberal state worth this name was to safeguard the right to dissent, criticism, and debate about ideas and measures. He argued that fascism had to be opposed on this basis, restoring to Italians “the right and the advantage of discord.”
In economics, Einaudi acknowledged a profound debt to the Italian school of pure economics and science of public finance
and considered him as a continuator. He regarded Maffeo Pantaleoni and Antonio De Viti de Marco as intellectual masters,
the two had been “founders of the 'pure' direction of finance in Italy”. However, this was not the only reason for
Einaudi’s admiration. Pantaleoni, author Pure Economics (1889), exemplified the pure economist, at the same time the
forerunner and continuer to the Marshallian school and a historian of economic thought. Einaudi preferred Pantaleoni
over Pareto, despite considering himself a devoted disciple of the latter, describing Pantaleoni as “so superior” to
Pareto (Preface to A. De Viti de Marco, Principi di economia finanziaria, Turin, Einaudi, 1934, p. xv). Einaudi
reiterated in 1950:
"Above all, I place Pantaleoni before Pareto—not only because he came first in the theoretical arena but because, though
he considered himself lesser and a follower of the other great figure, he was, in truth, the master of all. He
demonstrated that economic science is pure logic. Stripped of its utilitarian trappings, Pure Economics would turn out
to be nothing more than a modern economic Euclid, essential for young people to permeate in order to learn clear
reasoning about everyday matters" (La scienza economica. Reminiscenze [1946], in M. Finoia [ed.],
Il pensiero economico italiano (1850-1950), Bologna, Cappelli, 1980, p. 99).
Einaudi was equally admiring of De Viti de Marco, with whom he maintained a friendship cultivated over long years of meetings and correspondence. He credited to De Viti the merit of developing the most sophisticated framework for analysing public finance of that period, “applying to the public sector the concepts of competition and monopoly which had been necessary to give a precise order and explain so many facts of private economics”. This led him to elaborate “on the one hand, the hypothesis of the monopolistic state where taxation and public expenditure are set in order to provide the maximum profit for the ruling leaders or elites” and “on the other, the hypothesis of the cooperative state whose the financial system minimizes burden for the taxpayers thus bringing the best advantage to citizens who freely legislate through their delegate (ibid., p. 105).
Building upon these diverse and substantial foundations, Einaudi crafted his vision of society, economy, and politics.
3. The fight for Freedoms
Einaudi approached human nature and society from an antagonistic perspective. In his view, individuals—the fundamental units of any social organisation—reach their fullest potential when allowed to express themselves freely and autonomously. From this, he derived the belief that debate, conflict, and the competition of divergent ideals and lifestyles constitute a driving force, if not the primary engine, behind moral and material improvement and progress in the condition of men.
While this outlook was not uncommon within the broader liberal tradition—as already mentioned, Einaudi himself drew extensively from Mill—it was one he declined with notable originality.
As early as 1920, in an essay critiquing the conformist tendencies inherent in collectivism, Einaudi asserted that "the beautiful, the perfect is not uniformity, not unity, but variety and contrast." He further argued that the tendency towards uniformity was more indicative of decline rather than advancement: "The aspiration to unity, to the empire of one, is a vain chimera. It is the aspiration of one who holds an idea or who pursues an ideal of life and wishes that others, indeed all others share the same belief and pursue the same ideal. Such a person fails to see one important thing: that the beauty of his ideal arises precisely from contrast with other ideals, which may seem inferior to him, from the tenacity with which others defend their own ideals, and from the indifference with which many regard all ideals. An ideal, a way of living that all would embrace would lose its vitality. An idea or way of life universally accepted becomes worthless. [...] Ideas are born from conflict. If no one tell you you are wrong, you will no longer you hold the truth. On the day a single ideal triumphs, the struggle would inevitably begin anew, for it is absurd to imagine that humanity could remain content with nothingness. No—let us proclaim it loudly: the chaotic, tumultuous, anti-uniform, and undisciplined life we endure today, with all its harsh economic, moral, and individual consequences, may seem unbearable to us now. Yet it will be celebrated by future generations, who will reap the benefits of the political, economic, and moral truths forged through today’s conflicts." (Verso la città divina, Rivista di Milano, III, vol. VII, 1920, no. 36; now in Il Buongoverno. Saggi di economia e politica 1897-1954, ed. E. Rossi, Rome-Bari: Laterza, 1973, vol. I, pp. 34-35).
The philosophical foundation of Einaudi’s renowned maxim, ‘the rule of law as a condition for the anarchy of spirits’ (ibid., p. 37), can be traced in this philosophy: a legal framework should enable individuals to flourish while respecting the equal rights of others to pursue diverse and often conflicting belief and lifestyles.
This principle also underpins a celebrated essay composed in late 1923 for Piero Gobetti’s La Rivoluzione Liberale, later reprinted as the preface to the renowned collection Le lotte del lavoro: La bellezza della lotta. Here, Einaudi openly professed his “lively sympathy for the efforts of those who strive to rise by their own means and, in so doing, struggle, stumble, rise again, learning at their own expense how to succeed and refine themselves.” In the economic field, this was exemplified by the “socialist sentiment... which made workers raise their heads... and inspired them to extend a hand to their fellow workers, to think, to debate, to read” (La bellezza della lotta, La Rivoluzione Liberale, II, 1923, no. 40; now in Il Buongoverno, cit., vol. II, p. 523).
From these premises, Einaudi outlined the contrasting profiles of socialism and liberalism:
“Many are socialists without knowing it, just as many who call themselves socialists or were at the lead of workers'
movements against industrialists are, in truth, pure liberals. An industrialist is a liberal when he relies on his
spirit of enterprise and joins with his peers to negotiate with workers or buy and sell collectively; he acts as a pure
socialist when he demands protective tariffs from the state. Similarly, workers believe in freedom and demonstrate
liberalism when they collaborate with their comrades to create instruments of cooperation or defence; yet they acts as a
socialist when they demand from the state an exclusive privilege for their organisation or seek laws or judiciary
rulings to prevent strike-breakers from working. A liberal is one who believes in material or moral advancement achieved
through voluntary effort, sacrifice, and the aptitude to cooperate with others. A socialist, by contrast, seeks to
impose advancement by force, rejecting any method other than his own preferred approach and relying on privileges for
winning his cause while demanding prohibitions against those they oppose” (ibid., p. 524).
As is readily apparent, the tone and positions expressed here are not far removed from those in Verso la città divina, stated three years earlier. Yet, in La bellezza della lotta, Einaudi targeted a new adversary: the corporatist doctrine of class collaboration which he dismissed as “a new formulation, couched in a modified wording, of theories that have repeatedly sought to recover a mythical unity between the realms of capital and labour,” whereas precisely then it was necessary to “deny that equilibrium existed in the monopoly, in the legal or de facto suppression of adversaries.” If balance was the real goal, in order to meet it four basic principles were necessary and tow of them were paramount:
- 1. “The balance achieved through debate and struggle is preferable to that imposed by external force”;
- 2. “For equilibrium to last, it must be perpetually threatened with dissolution.”
Einaudi’s vision here takes the starting premises to their logical extreme. For the Piedmontese economist, “equilibrium consists of an unbroken sequence of continuous refinements through oscillations, which alternately grant victory to one or the other of the opposing forces.” This dialectic of social forces, he believed, was the natural order most suited to human nature, which “is such that, in the long run, it recoils from quiet and tranquil living. Should such stillness persist, it becomes the stillness of servitude, the mortification of the spirit. To the tranquillity that is death, labour—that is, life—is infinitely preferable” (ibid., pp. 526, 528, 531).
4. Market and Competition
For Einaudi, engaging in economic competition was an integral part of life’s vital struggles. From his antagonistic conception of human nature emerged a distinctive vision of the market and competition. The market, for sure, is a place where consumers’ preferences are met under the most advantageous conditions, a quality he deeply valued. However, more crucially, it represents a system that enables individuals to pursue professions of their choice, fostering economic self-determination and moral elevation. In this framework, work transcends its utilitarian purpose as a means of subsistence or wealth accumulation, becoming instead a source of personal growth, gratification, and self-respect—a rare and precious commodity, an asset to be safeguarded.
This vision formed the foundation of Einaudi’s original economic liberalism. At its core lay a staunch defence of
pluralism, to be understood in a number of lifestyles including the freedom to undertake professions aligned with
individual aptitudes and aspirations well as the presence of a multiplicity of economic actors in the marketplace assume
a preponderant role. This pluralistic ethos culminated in a broader theory emphasising the interdependence of civil,
political, and economic liberties:
"Freedom of thought is thus necessarily connected with a certain amount of economic liberalism... The historical
conception of economic liberalism asserts that freedom cannot thrive in an economic society devoid of a rich and varied
flourishing of human lives, each lived autonomously and not in servitude to a single will. In other words, and to
preclude any accusation of subordinating the life of the spirit to economics, the free spirit generates an economy
congruent with itself and cannot, by its very nature, produce an economy subjugated to any imposed idea or will—because
the very essence of life is to resist the intolerance of any other will. If really free, the spirit creates a varied
economy in which private property coexists with the property of groups, institutions, and state administrations,
alongside the activities of industrialists, merchants, farmers, professionals, and artists—each distinct from the other,
all drawing on their own sources for material sustenance of life. Such an economy allows individuals and groups to
survive, if necessary, even in poverty, without being reduced to beg for their living on a single authority, whether
that be the state, a tyrant, a ruling class, or an intolerant priesthood enforcing a single orthodox faith. On a
contrary, in a free or liberal society, individuals, families, classes, groups, commercial enterprises, charitable
foundations, schools, artisan or workers’ associations may derive their legal legitimacy from a supreme authority called
the state; yet they must feel and genuinely believe that they live their own lives autonomously [because] without the
coexistence of numerous independent forces, each drawing on its own original vitality, there can be no free society and
no liberalism”* (Dei diversi significati del concetto di liberismo economico e dei suoi rapporti con quello di
liberalismo, La Riforma Sociale, XXXVIII, vol. XLII, 1931, nos. 3-4; now in Il Buongoverno, cit., vol. I, pp. 228-229).
Virtually all the distinctive features of Einaudi's liberalism are encapsulated in this passage: the emphasis on the moral dimension, the primacy of individual choices, the indispensability of competition, the advocacy for extensive social pluralism, and the preference for a political system in which the exercise of power is restrained by intermediary institutions.
In particular, market economy is portrayed as a faithful projection of liberal society, or better, of liberal values.
This perspective, which Einaudi embraced early in his intellectual development, only achieved its definitive
articulation during a renowned debate with the philosopher Benedetto Croce between 1928 and 1941. In a series of essays
and speeches delivered from 1924 to 1927, Croce expounded his conception of liberalism, culminating in a notable
position in 1931 that denied any inherent connection between political freedom and economic freedom:
"As should by now be self-evident, liberalism does not coincide with so-called economic liberalism, with which it has
shared certain concomitances and perhaps still does, but always in a provisional and contingent manner. It attributes to
the maxim of letting things go and letting things pass no intrinsic value beyond its empirical utility, valid in
specific circumstances but invalid in others. Consequently, liberalism cannot in principle reject socialisation… nor has
it always rejected it in practice… and it opposes and contrast in specific cases only, where socialisation is deemed to
inhibit or depress wealth production to get to the opposite result that is not in the equal economic improvement of
society's members, but in an overall impoverishment—often unevenly distributed—and a corresponding decline in freedom
and even in an oppression which amounts to barbarisation or decadence. Because the sole criterion for judging any reform
lies in its capacity to promote freedom and life.” (Storia d’Europa nel secolo decimonono (1932), edited by G. Galasso, Milan, Adelphi, 1993, pp. 48-49).
As an example, as advocated by 19th-century communism, hypothetically, if the abolition of private property of the means of production resulted in increased production and therefore in a greater wealth, and, above all, in a further expansion of freedom, then “liberalism could not but approve and invoke that abolition from his initiative” (ibid., p. 50).
Einaudi addressed these contentious conclusions by advancing reflections aimed at establishing an inseparable link between liberism and liberalism. Could one truly achieve, even at a theoretical level, greater individual freedom through means inherent to collectivism? Or, to use Einaudi’s phrasing, could “a liberalism which accepted the abolition of private property and the establishment of communism” still be regarded as liberalism? His answer was unequivocally negative, rooted in the intrinsic features of a collectivist regime:
"There must be only one will that directs and determines the production and distribution of economic goods. [...] Essential to the system’s survival is that the instruments of action do not possess a will of their own, distinct and independent from that of the state and the political group in which the state is embodied. [...] If the will is singular and the collectivist society is perfect, only one ideology, one spiritual creed, can exist. Competing ideologies cannot be tolerated; heresies in a number equal as independent forces, inherently tend to dismantle and replace the prevailing ideology. These forces, rooted in the spirit, are far more potent than material or formal opposition. Communism, therefore, cannot tolerate freedom of thought, which would swiftly transform and undermine it and undermine it” (Dei diversi significati del concetto di liberismo economico e dei suoi rapporti con quello di liberalismo, cit., pp. 226-227).
What did all this mean? It revealed a far deeper interconnection between economic freedom and spiritual freedom than Croce had recognised. Einaudi’s conclusion was clear: liberalism could not “conceptually assist the advent of a communist economic order, as Croce seems to admit,” since communism and individual freedom were fundamentally incompatible.
They were incompatible because communist regimes did not encompass the peculiar feature of free and prosperous societies: a strong propensity to save. For Einaudi, the need of saving corresponded to a specific anthropological type, emblematic of the 'civilised' individual:
"So-called civilisation is characterised, from an economic point of view, by the prevalence of a sense of foresight, of concern for the future, of calculations for the distant future, of species egoism over a sense of the present, of immediate enjoyment, of individual egoism. There is an extraordinary distance between wild man and civilised man, between those who do not conceive the idea of tomorrow and those who subordinate the present to the future. It can be asserted that as the sense of foresight spreads among men and becomes almost universal, reducing the number of unwise squanderers to a diminishing and small proportion, to the same extent the rate of interest will tend to diminish and approach zero" (Il socialismo e il risparmio, Energie Nove, II, 1919, no. 4, now in Id., Le lotte del lavoro, edited by P. Spriano, Turin, Einaudi, 1972, pp. 101-102).
For Einaudi, saving was not merely an economic virtue but a moral choice. It was a choice that would bring individuals
to struggle to uphold the absolute value of freedom—a freedom embodied in the “peasant’s, merchant’s, artisan’s,
industrialist’s, professional’s, [and] artist’s need for liberty,” as well as in “the thinker’s need to meditate freely
... the religious man’s need to preach his word ... [and] humanity’s general need for legal equality with every other
individual.” Each of these forms of freedom, Einaudi believed, “were interconnected” and spoke to the very essence of
human nature:
"My thesis returns, therefore, always to the same point: the idea of freedom lives, yes, independent from that
practical, contingent norm, which was called economic liberalism; but it does not come into being, it does not inform
the lives of the many, until men, for the same reason that they wanted to be morally free, have succeeded in creating
types of economic organisation suited to that free life” (Tema per gli storici dell’economia: dell’anacoretismo
economico, Rivista di storia economica, II, 1937, no. 2, now in B. Croce - L. Einaudi, Liberismo e liberalismo, edited by G. Malagodi, Milan-Naples, Ricciardi,
1988, pp. 147, 150).
5. The Boundaries of Economic Freedom
This does not imply, however, that the market economy could be regarded as a self-sufficient microcosm. On the contrary, Einaudi maintained that the market could only yield positive outcomes for society as a whole under certain extra-economic preconditions. It was essential, in his view, to establish an ethical-legal framework that would foster the development of free enterprise while simultaneously mitigating its most destructive tendencies:
"Under the liberal regime, the law imposes constraints on human actions; and these constraints may be numerous, becoming even more so as the economic structure grows increasingly complex. The law—understood not as governmental or administrative power but as rules discussed openly and extensively, following public inquiries and consultations with all interested parties and those who believe they have something to contribute on the issue —must be enforced by ordinary magistrates independent of government and positioned above and beyond the favour of political authorities. Evidently, this is not a simple, direct, or assured path to prosperity, happiness, or the good. Quite on the contrary, in fact. It is a circuitous and arduous route, fraught with pitfalls and uncertainties, tiring and uncertain. Such is its nature because it cannot be otherwise: men must experiment at their own risk, err and atone for their mistakes to become deserving of paradise. They cannot educate themselves when someone else is appointed to decide, on their behalf and in their stead, what they must or must not do. Rather, they must educate themselves to become morally capable of assuming responsibility for their decisions" (Intorno al contenuto dei concetti di liberismo, comunismo, interventismo e simili, Argomenti, I, 1941, no. 9, now in Id., Il Buongoverno, cit., vol. I, pp. 289-290).
The construction of such a complex system—one in which core values underpinned the economic and political fabric—necessitated a reevaluation of certain liberal principles, beginning with a reconsideration of the relationship between morality and economics. Einaudi had embarked on this intellectual trajectory as early as the mid-1930s, but his thinking accelerated significantly after he established contact with the German economist Wilhelm Röpke (1899–1966). Röpke had developed a systematic proposal for reforming liberal doctrine, which he described as a 'third way' capable of transcending “the unhealthy alternative between laissez-faire and collectivism” (La crisi sociale del nostro tempo (1942), trans. E. Bassan, Rome, Einaudi, 1946, p. 32). His vision entailed a neo-liberal synthesis that avoided both the uncritical endorsement of monopoly capitalism—into which official liberalism had, in his view, degenerated—and the allure of socialist and statist solutions. Einaudi’s engagement with Röpke’s work was profound. Not only did he review Röpke’s seminal Die Gesellschaftskrisis der Gegenwart (The Social Crisis of Our Time), published in 1942, but in 1946 he facilitated the publication of its Italian translation through his son Giulio’s publishing house.
Einaudi found Röpke’s perspective particularly compelling, not least because he had largely anticipated already many of the fundamental principles in his own work. Themes such as a return to the land and nature, the promotion of independent professions and small-scale production, and the broad diffusion of property ownership are recurrent motifs throughout Einaudi's extensive scientific and literary writings. Nevertheless, it was during this juncture that he resolved to embark on a rigorous study of the rationale underlying economic systems, complementing it with a careful analysis of the psychology of social actors. Although economic and sociological factors certainly justified the need to limit the scope of competition, Einaudi regarded the moral arguments as even more significant. He seemed to align with Röpke’s critique of ‘historical capitalism,’ sharing the view that the presumed self-sufficiency of the market had too often been accepted uncritically. The reality, however, had proven markedly different, a fact insufficiently recognised by institutional actors, who bore the responsibility for introducing the necessary regulatory and administrative constraints on economic activity:
"The men of the past century assumed that it was enough to allow opposing interests to act freely, and from their conflict, a common advantage would naturally emerge. No, this is not sufficient. If laissez-faire, laissez-passer is left unchecked, what will occur above all are agreements and abuses by the few against the many, by the rich against the poor, by the strong against the weak, by the cunning against the naïve. But this critique of historical liberalism, destructive though it may be, only calls for a return to the pure origins of the competitive system. Such a return demands as much, if not more, intervention than any other economic system—intervention aimed at preserving the integrity of competition itself, the only genuine force capable of transforming the clash of interests into an adherence to the common good" (Economia di concorrenza e capitalismo storico. La terza via fra i secoli XVIII e XIX, Rivista di storia economica, VII, 1942, no. 2, p. 64).
This, however, was not the sole rationale for regulating economic processes. Preserving the individual’s ability to exercise economic freedom—and thus to access the market freely—required erecting barriers to market itself. As Einaudi noted in correspondence with one of his illustrious interlocutors: “If we do not create oases free from competition, we destroy the very competition that we wish to maintain as a general principle” (Luigi Einaudi to Ernesto Rossi, 10 July 1942, in Idd., Carteggio 1925-1961, ed. G. Busino and S. Martinotti Dorigo, Turin, Fondazione Luigi Einaudi, 1986, p. 104).
The necessity of these “free oases” became apparent from the unease expressed by many, a sign of a profound rupture that risked undermining the very foundations of the community:
At first glance, this perspective might seem at odds with the Einaudian vision as an advocate of struggle and supporter of an antagonistic liberalism inspired by Humboldt and Mill. Yet, these reflections must be envisioned within their context, as at a first approach they do not truly contradict his lifelong views, including his arguments during his extended debate with Croce. Einaudi had justified the necessity of economic freedom, and thus of the market economy as its practical manifestation, on moral grounds, that is the material and spiritual advancement of individuals. Without the ability to exercise self-determination in the economic sphere, individuals would be unable to fully develop their personalities. For society to flourish, it needed to permit its members the broadest possible range of behaviours—naturally always within the bounds of mutual respect for the equal freedom of others. The market economy was one of the most effective instruments for achieving this end. However, for this same reasons, limits had to be imposed on economic processes whenever they threatened to undermine their original purpose. Modes of production that clashed with the moral underpinnings of society or perpetuated poverty and conformity were incompatible with the liberal ideal. For Einaudi who was a supporter of liberalism, therefore, calling for restrictions on competition was entirely consistent. In his views, the unchecked dominance of competition would ultimately lead to the collapse of the liberal order itself.
Einaudi reiterated these strong principles from mid-1944 as he, alongside other anti-fascists, began considering the reconstruction of the Italian economy as soon as the war would come to an end concurrently to the fall of the fascist dictatorship. The liberal programme, he argued, should include a “fight against plutocracy and the latifundia”—a concept that required careful interpretation: “not a fight against the industrialist who forges new paths, who organises enterprises more efficiently, who increases production profitably through free competition with all others,” but rather “a rigorous battle against all those who derive their success from privileges, from natural and artificial monopolies, from protectionism, and from prohibitions.” These measures, he explained, were aimed primarily at “uplifting the masses, making them worthy of and capable of participating in the economic governance of society,” alongside a revitalised middle class (Lineamenti di una politica economica liberale, Rome, Movimento Liberale Italiano, 1943, now in Riflessioni di un liberale sulla democrazia, cit., pp. 8–11). To achieve this programme, liberals needed only to draw upon their own intellectual traditions, without giving any space of maneuvering to the tenets of socialism or statism. The liberal state, Einaudi maintained, had a duty to ensure the broadest possible equality of starting points for all citizens, thereby mitigating inequalities inherited from the past. It was the state's responsibility to provide those whose “parents cannot support them in the race of life without an excessive initial burden” with “the indispensable minimum that prevents them from being compelled to accept, immediately, the lower labour opportunities available and instead allows them to wait and choose employment better suited to their abilities” (Lezioni di politica sociale, ed. F. Caffè, Turin, Einaudi, 1977, p. 250). The resulting market model out of such interventions would meet at best the goal to facilitate the self-realisation and advancement of the majority of individuals and families.
Furthermore, the competition economy served as a formidable counterweight to curb intolerant majorities or despots unwilling to permit autonomy within civil society. This point was perfectly in line with Einaudi’s enduring conception of the liberal state, a vision he had been articulating consistently over the years.
6. The Liberal State
Einaudi, alongside numerous other thinkers, both liberal and otherwise, expressed a pronounced scepticism towards the advent of mass democracy, particularly as it emerged through universal suffrage and the increasingly dominant role of political parties. For this reason, he regarded the incorporation of robust countervailing powers and institutional safeguards as imperative to preserve individual liberties by curbing political authority and mitigating the influence of the public sphere on civil society.
Even in the face of prevailing fascism, Einaudi reaffirmed the enduring validity of the core principles of classical liberal constitutionalism:
"The demo-liberal state, which entrusts legislative and executive powers to representatives elected by the majority of a parliament chosen through suffrage—whether universal or broadly inclusive—of voting citizens constructs its political class through the following mechanisms:
- Unrestricted freedom of discussion, allowing any individual, through speech or writing, to challenge the errors or insufficiencies of the ideas and intentions of others aspiring to public office;
- The absence of any personal entrenched privilege: no one who has attained high political office is immune from being overthrown by a newcomer who knows best how to win public support;
- The absence of protected positions for dominant interest groups: whether industrialists, farmers, intellectuals, peasants, or workers, all must rely on debate and mobilisation to make their voices heard, demonstrating that their concerns merit attention or protection."* (Stato liberale e stato organico fascista, Corriere della Sera, 16 August 1924, later in Cronache economiche e politiche di un trentennio, vol. VII, Turin, Einaudi, 1965, pp. 794–795).
Einaudi placed significant emphasis not only on the political class itself—whose formation, as will be discussed subsequently, he regarded as central—but also on adherence to procedural fairness and the constraints imposed by the equal liberty of all contenders for power. However, even when the procedural safeguards ensuring freedom for all were scrupulously observed, Einaudi maintained that a liberal state worthy of the name should refrain from excessive interference in the choices of its citizens. He envisaged a state model in which social and economic pluralism would serve to preserve the essential domains of public and private freedom. This principle was powerfully articulated in a comprehensive passage from 1925, which deserves to be quoted in its entirety for its enduring relevance.
“The liberal state is far from being agnostic both in faith as well as in economics and morality. It holds a clear doctrine an acts on the basis of this doctrine. When the state refrains from intervening religious disputes and refuses to endorse the supremacy of a church over the others, it does so because it is founded on the belief that only individual conscience can attain a true sense of the divine. Why, adhering to this conviction, should it compel individual consciences to choose and create for themselves the faith in which they best fit? Should it not, as it indeed does, empower individuals to freely choose and cultivate the faith that best aligns with their inner convictions?Similarly, in the economic sphere, why should the liberal state substitute itself for the individuals thus creating a paternalistic or collectivist system of production and trade when it is the opinion and the the principle of the liberal state that the individual can best attain the maximum advantage in production and trade by freedom of action? In adhering to such a principle, the liberal state does not exhibit agnosticism; rather, it remains faithful to its doctrine and logical in its implementation. However, should it determine that unchecked individual freedom leads to the oppression of others or undermines the collective good, the liberal state does not hesitate to impose limits on absolute individual liberty. […] The liberal state operates on the foundational belief, which constitutes both its faith and raison d’être, that individuals must be afforded optimal conditions to fully develop their personalities, contribute moral and material enrichment to themselves and the community, and engage in competition and collaboration with the other members other community—whether individually or through associations—towards diverse and personal objectives. As collective life advances and becomes increasingly complex, the constraints and regulations on individual action may multiply. However, their purpose remains constant: to foster the genuine, spontaneous development of human personality. Liberalism diverges fundamentally from socialism on the one hand and from authoritarianism on the other. While these two doctrines appear opposed, they actually converge in one critical aspect: both rely on external forces—be it organisation, government, or law—to drive human progress. They presume that such external impulses must act upon the individual to elevate them. Whereas the liberal doctrine denies the efficacy of such external impulses and if it grants any capacity to the liberal state, to the external force to do something; that anything to do is remove obstacles, establish conducive conditions, and delineate pathways and take steps through which individuals can pursue their own way to salvation by their own refinement, effort, experience, and through the trials of failure and conflict—as well as in contrast of collaboration with others, individually or collectively. To reject the virtue of paternalism and affirm the transformative power of self-education—does this not embody a faith, a doctrine? Never no. On the contrary, it means having a manly faith, a manly doctrine. It means believing and acting so that man may ascend, in fellowship with other men, towards ever higher ideals and a divine aspiration (La dottrina liberale, Corriere della Sera, 6 September 1925, later reprinted in Cronache economiche e politiche di un trentennio, vol. VIII, Turin, Einaudi, 1965, pp. 461–462).
The liberal state was conceived with an undeniably individualistic foundation, yet it was not the atomistic individualism caricatured by the critics of liberalism, for it envisioned an individual deeply embedded within the social fabric. If the ultimate goal of the liberal ideal was to ensure the fullest development of individual skills, then both the institutional and economic structures were subordinated to and shaped by this overarching purpose. For Einaudi, progress was inconceivable without struggle, without individuals being free to create and pursue diverse and conflicting ways of life. This was the principle laying at the heart of the liberal state, the very principle that the Fascist dictatorship would soon seek to definitely annihilate.
Much the same way, when contemplating the reconstruction of Italian democracy after two decades of Fascist rule, Einaudi cautioned against adopting a model inspired to a 'pure' Franco-German democracy. If one of the liberal state's primary roles was to safeguard the right to dissent, to question and criticize whatever idea and policy, how could such a system be effectively realised in practice? To address this challenge, Einaudi developed a distinctive interpretation of the principles of liberal constitutionalism. This vision was centered on the separation of powers—both horizontally (legislative, executive, judicial) and vertically (central and peripheral levels)—and on the imperative to render rights and freedoms inviolable, placing them beyond the reach of ordinary legislative action. His framework for the organisation of political powers is cogently encapsulated in the following excerpt:
"The source of political power is one only: the will of the people freely manifested, in the secrecy of the ballot box, by means of the ballot paper. [...] Beside the repository of the people's will, there must exist its interpreter. Whether an hereditary king or an elected president, this figure is not tasked with governing, but with formalising the designation implicitly made by the electorate of the person who shall constitute the government. [...] When the will of the people is unambiguous, the prime minister selects his colleagues. Naturally, he chooses them in such a way as to reflect the various currents within the majority, or, in the case of coalitions—so often indispensable during critical periods, especially in times of war—the differing opinions present in parliament. Yet this selection is made in his unquestionable judgement, as the ministers he appoints must form a cabinet that governs collectively and with shared responsibility. […] The fundamental principle remains firm: the will of the people, expressed through elections or spontaneous political formations, appoints the individual who commands the confidence of parliament… however, the government or cabinet must not be the direct emanation of individual or collective political parties. A government ruled by parliaments or political factions is synonymous with tyranny. Parliaments and political groups are tasked with appointment and oversight; they can, and must, never assume the role of government” (First Impressions, Risorgimento Liberale, 13 December 1944, reprinted in Riflessioni di un liberale sulla democrazia, pp. 88–90).
A pivotal role, however, was to be accorded to local autonomies. For Einaudi, one of the foremost priorities was the abolition of the prefect, “that symbol of the centralised administrative apparatus, which has rendered, in the past and will inevitably render in the future, as long as it endures, liberalism and democracy a vile falsehood” (Gerarchia nel programma, L’Italia e il secondo Risorgimento, 1 July 1944, reprinted in Riflessioni di un liberale sulla democrazia, p. 55). The institution of the prefect, described as a “disease...inoculated into the Italian political body by Napoleon,” would thwart any vague desire for self-government. In Einaudi’s view, “Democracy and the prefect profoundly repeal each other,” so as to make “elections, the free choice of representatives, chambers, parliaments, and responsible ministers...to a dismal farce” (Via il prefetto!, L’Italia e il secondo Risorgimento, 17 July 1944, reprinted ibid., pp. 55–56). Centralisation would not only stifle the formation of a capable and responsible political class, an undesirable and, for Einaudi, even intolerable effect:
“In countries where democracy is not an empty word, people manage their local affairs themselves...without waiting for instructions or authorisation from the central government. In this way, a substantial political class is cultivated, selected on repeated scrutiny. [...] A political class does not materialise spontaneously, nor does it stem out from the fiat of a general election. Instead, it grows out from the bottom, through the choices made by individuals who personally know those to whom they entrust the management of minor local affairs, and then, progressively, larger national or even inter-state responsibilities. However, a political class cannot emerge if those elected to oversee municipal, provincial, or regional matters are not made fully accountable for their actions. If another authority retains the power to issue orders or overturn decisions, the elected official ceases to be responsible and fails to learn the art of government. Instead, he learns only how to obey, to scheme, to seek favours and support. Without the ability to govern oneself and one’s own affairs, what remains of democracy?” (ibid., pp. 56–57).
Einaudi’s federalism, firmly rooted in the classical liberal tradition, was enriched by an additional dimension. He frequently asserted that the preservation of a genuinely liberal regime required the existence of numerous autonomous centres of power. Yet he augmented this conviction with a further insight: local authorities and citizens’ associations were not merely instruments of countervailing power but also vital spaces for the personal growth and development of the individual. As he eloquently articulated:
“For free government to exist, it is essential that men perceive themselves as distinct from others; that they take pride in belonging to a municipality, to a community or federation of municipalities, to a region... It is imperative that, alongside territorial authorities, there should exist professional rosters, associations of artisans, or workers’ or peasants’ unions, as well as chambers of industrialists, merchants, and farmers. It is equally important that there be bodies of teachers, ranging from primary school educators to university professors. [...] It is necessary that there be a judiciary order tied to the source of authority…solely by an initial act of appointment, but in truth that order must be recruited by customs being unbreakable by themselves...If we wish to avert the dreadful peril of tyranny—an ever-looming danger in modern industrial societies, as foreseen and feared over a century ago by the great political thinkers Alexis de Tocqueville and Jacob Burckhardt—then every effort must be made to preserve, reconstruct, and fortify the independent social and political forces that act as a counterbalance to the Leviathan state. The human person and the associations of which individuals are authentically a part must be empowered: the family, the neighbourhood, the municipality, the community, the region, the trade association, the factory, the professional body and the church. Individuals must not feel isolated, as atoms among atoms, numbers among numbers, all equal, all equally sovereign, and thereby all equally servile.” (Letteratura politica, Idea, II, 1946, no. 3, reprinted in Riflessioni di un liberale sulla democrazia, pp. 195–196).
Within this conviction, one can discern, among other influences, the imprint of liberal Catholicism, a tradition to which Einaudi devoted considerable attention, engaging in dialogue with its distinguished exponents, most notably the aforementioned Wilhelm Röpke. Unlike many Catholic thinkers, however, Einaudi categorically opposed the adoption of a proportional electoral system, which he viewed as culpable for fragmenting parliamentary representation and undermining the formation of stable governmental majorities. He observed that in nations “where the democratic regime was more firmly rooted... public opinion had, for the most part, remained practically indifferent” to polling on a proportional basis, adhering instead to the system of the “small single-member constituency” (Contro la proporzionale, Idea, I, 1945, no. 3, reprinted in Riflessioni di un liberale sulla democrazia, p. 127). While this system may not have fully satisfied aspirations for fair and equal representation of all political forces, it would have ensured greater flexibility and, above all, more effective parliamentary functioning. Einaudi regarded political parties not as exclusive custodians “of citizens’ ideas and interests”, but rather as mere instruments through which the public engaged with the management of public res (ibid., p. 129).
Proportional representation, in his view, risked magnifying the power of parties—or, more precisely, their electoral committees—while stripping the electorate of “any genuine freedom in choosing their representatives.” By contrast, the single-member majority system, despite its imperfections, would have provided a better coherence and a reduced dependence on party central committees, and encouraged the election of independent candidates. For Einaudi, the preservation of individual autonomy and independence remained paramount, particularly within the political domain.
7. Political class and Elected Class
We have noted the extent to which Einaudian constitutionalism was characterised by the search for a convincing balance between the reasons of freedom and good governance, with particular emphasis on the legal guarantees of rights and on institutions designed to prevent undue concentrations of power. But, as mentioned earlier, the quality of public life would have depended largely on the quality of the political personnel, whose selection was therefore the key to a truly liberal-democratic system.
In this Einaudi was, and he himself admitted this more than once, a disciple of Gaetano Mosca and Vilfredo Pareto. In particular, a common sensitivity to the socio-economic foundations of representative systems and the conviction that, in the final analysis, the ruling classes characterised the life of the state as much as the institutional structure, brought him close to Mosca. Einaudi also believed that Mosca deserved the credit for having 'discovered' two principles that should have formed the basis of any scientific analysis of politics:
"Firstly, the government of the country is not and can never be governed by the majority of the people or even by a genuine representation of the majority of the citizens. This is a dangerous and destructive utopia for social coexistence. Political government must be in the hands of an organised minority...On the good choice of the political class depends the fortune of a country. [...] Secondly, the necessary and useful dominance of the political class needs, in order to preserve itself, an ideology, to which Mosca gives the name 'political formula': and this can be force, heredity, divine right, popular sovereignty. Little by little, all these formulas are equivalent, being merely the external verbal manifestation of the true reasons by which the political class affirms its ability to govern the multitudes' (Parliamenti e classe politica, 'Corriere della Sera', 2 June 1923, now in Id., Cronache economiche e politiche di un trentennio, vol. VII, cit., pp. 264-265).
But Mosca had, at the same time, pronounced a eulogy of the representative regime, the only political system to ensure a condition of freedom for citizens. Moreover, as for his colleague, for Einaudi too, the presence of independent social forces, among which the middle classes stood out, was indispensable, 'since the manner in which these intermediate strata are formed and function mainly depends on the type to which a political body belongs and the effectiveness of its action' (Elementi di scienza politica, edited by G. Sola, Turin, UTET, 1982, part II, ch. 1, p. 940). In Einaudi's words, only social diversity could guarantee the existence of a free government:
"The representative state is...founded on the existence of forces independent of and distinct from the state itself: remnants of the landed aristocracy, middle classes who derive their own livelihood from the exercise of industries, trades and liberal professions, representatives of organised labourers in industries not living off state beggary. If these conditions are fulfilled, we have a truly free government; in which the officials are not the only existing political class, but one of many forces, from whose contrast and cooperation arises the possibility of an action truly useful to the whole' (Parliaments and the Political Class, cit., p. 267).
Social pluralism as a necessary but not sufficient condition for the formation of a diverse, educated and healthy political class. However gradually, Einaudi's dissatisfaction with this theoretical model grew: was the Machiavellian and unscrupulous political class described by Mosca and Pareto really the only one possible? Could his leadership guarantee society good governance, peace and prosperity? Or was it not rather a question of investigating more deeply the reasons that led the ruling classes to determine, sometimes tragically, the fate of the communities they governed, with the intention of proposing an alternative model? Faced with the example of the European political classes that had favoured the rise of totalitarianism, Einaudi then turned to the work of the French economist and historian Frédéric Le Play, in whom he could find an analysis of those 'powerful, sometimes mysterious forces that explain greatness and decadence, the permanence and the decay of societies", which he then identified with the role played by the elect class, i.e. by the set of those "natural authorities [that] receive strength from moral virtue and custom" (Il peccato originale e la teoria della classe eletta in Federico Le Play, "Rivista di storia economica", I, 1936, no. 2, now in Id, Saggi bibliografici e storici intorno alle dottrine economiche, cit., pp. 315, 317). This aristocracy of the spirit only rarely coincided with the political class, 'but on those rare occasions when the two classes become one, the foundations of a country's lasting greatness are laid for centuries' (ibid., p. 319). This is because the true state needed the leadership of a ruling class that shared the aims of the citizens, because it was itself formed by citizens, by free men:
"The conception of the political class as that which consists of those groups of men who aspire to conquer power, or manage to conquer it and retain it for a more or less long time, a conception dominant in the classic books of Gaetano Mosca and Vilfredo Pareto, is not the only one possible. Alongside it, there is not infrequently another class, of men who do not aspire to power, and who are not infrequently persecuted by those in power. These are the Christians of the first two centuries, the great philosophers, the wise and the virtuous of all times. They have the moral power and are sometimes much more powerful than those who hold political power. They make up the elect class. It happens very rarely that the elected class is called upon to govern states or has a preponderant and decisive part in government. In these states, moral law tends to be observed, relations between the social classes are not disturbed by discord and envy, the economic conditions of the nation progress, progress being understood to mean a situation in which men are dissatisfied only because they nonetheless yearn to elevate themselves, and public finance is designed to rest on universal consent" (Ipotesi astratte ed ipotesi storiche e dei giudizi di valore nelle scienze economiche, "Atti della R. Accademia delle Scienze di Torino", vol. 78, 1942-1943, tome II, now in Id, Scritti economici, storici e civili, edited by R. Romano, Milan, Mondadori, 1973, p. 406).
The problem recurred even in the new democracies that emerged after the end of the Second World War. Certainly one could not do without the democratic principle, the only possible foundation of a free government, especially at that particular historical moment. But this did not mean that the search for and emergence of the elected class had to be renounced. In the new liberal-democratic regimes, this task would be assigned to the people:
"To the major pars the spontaneous instinct of man living in political society contrasts the sanior pars of the scholastics, Gaetano Mosca's political class, Vilfredo Pareto's elite. But Gaetano Mosca and Vilfredo Pareto had already made it clear that neither the political classes nor the chosen classes (the elites) can be identified with the meliores...The political class can be morally or intellectually inferior to the average of the men who make up the society from which it is drawn. The fundamental political problem does not lie in truly constituting a majority government. Whatever the formal structure of the state, power always rests with a small minority. If we call democratic society that in which the government is intent on procuring the maximum possible moral and material good of the men who make up the national collectivity today and tomorrow, we will say that the aim of democratic society is all the more likely to be achieved insofar as the 'majority', to whom the choice of the small governing group necessarily belongs, succeeds in identifying the elected representatives with the sanior pars of the political class" (Major et sanior pars, "La Città Libera", I, 1945, no. 3, now in Id, Il Buongoverno,cit.,vol.I, p. 98).
Given that power, even in a liberal democracy, would be exercised by an organised minority, it was up to the voters to designate the elected class. However, the rise of totalitarian regimes had shown that constitutional constraints themselves could be swept away by the exercise of the will of the people. The choice of rulers was up to the governed, of course; but how could one be sure that the people would choose the best political class? And how to avoid, in the unfortunate event of an electoral victory of an illiberal minority, fatal violations of the rights of liberty? The answer, for Einaudi, lay in the introduction, at constitutional level, of very strict legal constraints, so as to prevent, or at least make extremely unlikely, abuses of power:
"Where there are no restraints on the arrogance of the political classes, the suffrage of the majority is likely to be gained by demagogues intent on procuring power, honours and riches for themselves, to the detriment of both the majority and the minority. The purpose of the restraints is to limit the freedom to legislate and operate of the governing political classes chosen by the majority of voters. On the surface, they violate the democratic principle that gives power to the majority; in reality, by limiting their powers, the brakes protect the majority against the tyranny of those who would otherwise act in its name and, in so doing, implicitly protect the minority. [...] The restraints are the extension of the will of dead men, who say to living men: you shall not do as you please ... you must, on pain of violating solemn oaths and constitutional charters, observe certain rules that seemed to us essential to the preservation of the state we founded. If you wish to change these norms, you will first have to think long and hard, you will have to obtain the consent of the majority of your peers, you will have to tolerate that certain groups of them, the minority of them, obstinately refuse to consent to the change desired by the majority' (ibid., pp. 99, 101-102).
8. The Governance of Public Opinion
Thus, the discussion was back to the starting point: the inescapable requirement of countervailing powers capable of neutralising, or at the very least constraining, the abuse of power by both oligarchies of professional politicians and unruly, intolerant majorities. Alongside constitutional engineering mechanisms and intermediary institutions, Einaudi identified one of the most potent—if not the most decisive—countervailing forces in national public opinion composed to all the individuals who embraced the imperative “to know in order to deliberate” (a celebrated and oft-cited maxim of Einaudi) and who acted to convey their views and experiences to the ruling classes.
As Einaudi contended, Parliament itself would derive its strength and legitimacy from participating in this process of public debate, working in concert with public opinion to deliberate on and ultimately approve legislative measures that had been thoughtfully conceived and refined through collective contribution:
"Parliament derives its value from being the voice of the nameless people who count for nothing, but who make their admonitions heard during the interval—whether short or protracted—in the time between the submission of a bill on the chamber or senate presidential desk and its conversion into law. The true safeguard of the life, liberty, and property of citizens lies in this interval of public scrutiny. This is the chief virtue of parliaments, a virtue that must not be extinguished. [...] A strong government thrives on transparency and debate. It cannot ignore the voice of parliamentary members, nor dismiss the individual who raises a valid argument… hitherto, the sole reliable method… has been to grant everyone the liberty to speak and write. The danger posed by a government that demands secrecy and immunity from public debate to carry out its agenda is too great" (Il contributo del primo che passa, Corriere della Sera, 15 November 1922, reprinted in Il Buongoverno, vol. I, p. 51).
For Einaudi, as we have seen, the contestation of ideas and opinions was an essential driver for progress. It was for this reason that he, a prolific columnist over several decades for leading newspapers such as La Stampa and Corriere della Sera, accorded the press a crucial role. He regarded newspapers as the principal instruments for disseminating a passion for informed debate among individuals and associations. Such debates, he insisted, had to rest on the largest possible comprehensive understanding of the facets of the subject at hand as well as of the arguments advanced by opposing perspectives. “The new idea,” he wrote in 1945, “is neither defended nor vanquished in parliaments. It is born in books and reviews, propagated in newspapers, and inspires associations and advocacy groups. It eventually conquers public opinion—that is, the prevailing opinion among those who do not yet adhere to a particular creed” (Contro la proporzionale, p. 139). In Italy, moreover, “before 1922 and even until 4 January 1925, there existed a robust independent press,” and in the aftermath of the Second World War, “newspapers continued to be almost the sole medium through which voters could be guided to form a strong democratic government, truly representative of the popular will” (Il problema dei giornali, Nuova Antologia, vol. 434, 1945, no. 1735, reprinted in Riflessioni di un liberale sulla democrazia, pp. 167, 170).
Einaudi's gaze was, however, not only turned to the past or to the narrow contingency, but to the future and in this sense he could not help but note that 'without a truly free press representing all shades of public opinion, the general elections that will have to be called later will resemble much more a Napoleonic, Mussolinian or Hitler plebiscite than a rational selection of the best men to put at the helm of state'. He also added that, while not failing to recognise the sometimes highly positive role of the party press and the social partners, the independent press would prove indispensable: if in fact 'only the man, the person, the thinking brain is capable of creating the new, of not bowing to the trappings, of pronouncing the truths unpleasant to most', it follows that 'only the independent newspaper exposes the idea born in the brain of the person who puts it on paper and not the one that has already managed to assert itself in the gatherings or councils of parties and social groups'. A crucial task, since any society 'slowly dies if it lives only on old ideas' (ibid., pp. 167, 176).
But of course the press alone was not enough to create a vigilant and autonomous public opinion. Hence the attention with which Einaudi repeatedly dealt with the problems of education, from primary school to university. In a particularly famous and inspired essay, Einaudi reiterated the need to stimulate competition even in the area of 'middle schools and universities' in order to create more space 'for the battles of ideas'. The Italian system was still based on the Napoleonic model, according to which "the State has the right and the duty to provide for teaching" (Scuola e libertà [1956], now in appendix to G. Limiti, Il Presidente professore, Milan-Trento, Luni, 2001, pp. 188, 190), with the inevitable and very harmful corollary of the recognition of the legal value of qualifications. This system, which imposed a "uniform regulation of programmes in secondary schools and ... of the order of studies in faculties and university schools", for Einaudi however proved inferior to the Anglo-Saxon-inspired system which, thanks to its greater elasticity and the presence of numerous competing institutions, would have allowed for a real possibility of debate and also, not a secondary effect, a qualitative growth in the supply of education. This was not a trivial difference, but rather the difference 'between totalitarianism and freedom', since 'totalitarianism lives with monopoly, [whereas] freedom lives because it wants the debate between freedom and error' (ibid., pp. 222, 233). Truth, portrayed once again as a value-boundary, required a search free of conditioning and characterised by the greatest freedom of confrontation between contrasting ideas.
Einaudi’s perspective was not confined to the past or to immediate circumstances; his vision extended toward the future. He could not help but observe that, “without a truly free press representing all shades of public opinion, the general elections that will eventually be held will resemble far more a Napoleonic, Mussolinian, or Hitlerian plebiscite than a rational selection of the best individuals to steer the state.” While acknowledging the occasionally constructive role played by the party press and social organisations, Einaudi argued that an independent press was indispensable. Only “the thinking individual, person and mind can generate novel ideas, can resist the weight of conformity, and articulate truths unwelcome to the majority”. Consequently, “only the independent newspaper gives voice to the idea conceived in the mind of the individual who puts it on paper, rather than to one that has already been stated in the assemblies or councils of parties and social groups.” A crucial task because any society “slowly decays if it subsists solely on outdated ideas” (ibid., pp. 167, 176).
However, a free press alone was insufficient to foster a vigilant and independent public opinion. Hence, persistent attention Einaudi devoted to education, spanning from primary schools to universities. In a particularly notable and eloquent essay, he reiterated the importance of fostering competition even in the area of “secondary schools and universities” to expand the space available for “battles of ideas.” Italy’s educational system, still rooted in the Napoleonic model that enshrined “the state’s right and duty to oversee teaching”, inevitably entailed the harmful corollary of recognising the legal validity of qualifications (Scuola e libertà [1956], now in appendix to G. Limiti, Il Presidente professore, Milan-Trento, Luni, 2001, pp. 188, 190). This model, with its requirement of “a standardized regulation of curricula in secondary schools and… of the program of studies in faculties and university schools”, proved, in Einaudi’s view, inferior to the Anglo-Saxon-inspired system. The latter, with its greater flexibility and the numerous competing institutions, allowed for genuine debate and, as an additional benefit, spurred qualitative improvements in educational offerings. This distinction was far from trivial; rather, it marked the boundary “between totalitarianism and freedom,” for “totalitarianism thrives on monopoly, [whereas] freedom endures by encouraging the debate between truth and error” (ibid., pp. 222, 233). Truth, as a cardinal value, demanded a search unencumbered by external constraints and enriched by the broadest freedom to challenge conflicting ideas.
Even more so, the same freedom should feature university studies. As a professor at the University of Turin for over half a century, Einaudi envisioned that scientists gathered in universities would succeed in “instilling… in politicians especially, the lesson of humility” i.e. getting them to admit “not possess the truth” and thus taking the responsibility to seek it through the widest debate: “It is not the role of the university to declare the superiority of the market economy over the regulated economy, or of a liberal society over a socialist one. Our task is to admonish: let no one presume to be a guide for the people; let no one claim to know that general will which citizens are tasked not with discovering, but merely recognising and implementing it after being recognized by those who proclaim themselves guides. Self-criticism aimed at recognizing the error of one's own deviations from the truth declared by the man-guide, the college-guide, the party-guide ; criticism constrained within the boundaries defined by the ‘wise’—whether the individual, the college, or the party-guide—is not criticism; it is servile submission to a tyrant-guide. The university, a community of teachers and learners, rejects such type of criticism. Its ethos remains unwavering: truth is achieved only by acknowledging that every established truth, every accepted principle, may in fact be flawed. Truth endures solely because it can be denied. By preserving the freedom to challenge it at any moment, we affirm, each time, the dominion of truth” (Jean Jacques Rousseau, les théories de la volonté générale et du parti-guide et les tâches des universitaires, Kyklos, X, 1956, pp. 289-295; Italian translation in Prediche inutili, Turin, Einaudi, 1962, pp. 200, 201, 202).
The safeguarding—and, where possible, the expansion—of these arenas for intellectual exchange constituted a fundamental objective of liberal society. Any liberalism that failed to embrace this imperative would condemn itself to lose its raison d’être,
9. Epilogue: the Past and the Future of Freedom
Drawing definitive conclusions about Luigi Einaudi’s liberalism is no an easy task. Scholars have, at various times, have expressed their opinion in trying to depict him either as an uncritical apologist for the bourgeoisie or, conversely, as a liberal-socialist. Both interpretations, however, appear equally inadequate in light of the analysis presented here.
A firm point must be established: regardless of the many possible interpretations, Einaudi’s political thought is inspired to the teachings from the fathers of classical liberal theory. More precisely, his liberalism was distinctly Anglo-Saxon in style. Einaudi was acutely aware that his ideas were part of a long theoretical lineage, tracing back to the eighteenth-century writings of David Hume and Adam Smith. At the same time, his political thought is featured on the recognition of the inseparable link which connects all forms of freedom—political, economic, and civil. In this respect, despite its relatively modest prominence, compared at least to the philosophical influence of Benedetto Croce, Einaudi’s political and economic theories arguably constitute the most significant contribution of Italian liberalism to the broader traditions of European and North American liberal thought.
One further aspect of Einaudi’s philosophy deserves a mention: his openness to the future of freedom and his receptiveness to initiatives aimed at expanding the scope of action for individual autonomy. His thrust to modernization was so peculiar because it had been largely shaped by the lessons of a failed historical experience in which he had played some role—the rise of the fascist regime. Before the unrest and demands for social reform that followed the First World War, “the political classes, which had succeeded in leading Italy to victory and organising the nation’s lively forces to resist the enemy-invaders, did not measure up when facing the the social enterprise” (La via breve, L’Italia e il secondo Risorgimento, 2 December 1944; reprinted in Il Buongoverno, vol. I, p. 81). Faced with a rather complex situation, many, including Einaudi himself, had hoped for the restoration of calm and social peace. However, they failed to recognise that “anxiety and uncertainty are inseparable companions of life, and absolute security and tranquillity are forever desired but never achieved— nor achievable if not through constant struggle and daily effort.” Instead, the nation chose the “short way” of fascist dictatorship. Yet, as Einaudi observed, “this way ultimately represented the Italians’ renunciation of the arduous struggle, the sustained effort, the constant risk, in favour of the illusion of security, peace, quietness and prosperity guaranteed and promised by others” a way that “had necessarily, inevitably lead to the edge of the abyss” (ibid., pp. 83, 88–89).
Making up for the mistake was not possible. However, it was conceivable to work to ensure that Italians would never have to face such a perilous choice again —or at least, that they might be better equipped to avoid a similarly tragic decision. The principal instrument in this endeavour, as Einaudi declared in his brief speech to parliament as the first-elected President of the Republic, was the new democratic constitution. Although it contained provisions that Einaudi, as a liberal, did not entirely support, the constitution embodied the spirit that, in his view, should represent the backbone fo all free and prosperous societies: the commitment to “preserve from the existing social structure all and only that which guarantees the freedom of the human person against the omnipotence of the state and private arrogance; and to ensure for all, regardless of the accidents of birth, the greatest possible equality at square one in life” (Messaggio dopo il giuramento, reprinted in Lo scrivio del Presidente 1948–1955, Turin, Einaudi, 1956, p. 5).
The new constitution also represented a test case for democracy, “which, if it is anything, it is discussion and struggle, even lively, even tenacious between differing and opposing opinions; and it is, in the end, the victory of one opinion, clarified as dominant, over the others” (ibid., pp. 3–4). Moreover, despite his own scepticism and that of others, the republican system, like other democratic regimes across Europe and beyond, posed a challenge to the future of global society—a challenge that it was determined to meet and overcome: “Between the years 1848 and 1948… a wholly unprecedented problem arose—one that the great political thinkers of the previous century had deemed insoluble: the problem of durability of democratic systems when no longer a small, privileged minority but tens of millions of citizens, all equal before the law, are called upon to vote and deliberate. Universal suffrage seemed, and still seems to many, incompatible with liberty and democracy. The constitution that Italy has now adopted is a challenge to this pessimistic vision of the future” (ibid., p. 4).
Trust in the capacity of human beings to pursue freedom, tempered by a clear-eyed recognition of the obstacles that inevitably lie in their path—this is perhaps the most enduring and relevant message of Luigi Einaudi’s profound and prolific reflections.