However these class distinctions need to be removed from their contemporary Marxist interpretations of workers versus capitalists or rich versus poor. Before Marx, class theory focused on those who made a living by voluntary means (the market) and those who used monopoly force (the state). This analysis began with Charles Dunoyer and Charles Comte, two French classical liberals. Later, in England during the 1820's and 1830's, this pre-Marxist theory of the class struggle either influenced James Mill or he developed it independently.
As Murray Rothbard summarizes,
"The ruling class is whichever group has managed to seize state power; the ruled are those groups who are taxed and regulated by those in command. Class interest, then, is defined as a group's relation to the state. State rule, with its taxation and exercise of power, controls, and conferring of subsidies and privileges, is the instrument that creates conflicts between the rulers and the ruled. What we have, then, is a "two-class" theory of class conflict, based on whether a group rules or is ruled by the state."
By divorcing the class struggle from its Marxist interpretations the rise and fall of the Liberal Party in Canada can be traced to its root cause. Likewise, the eventual return of Liberal rule can owe its successes to this classical liberal interpretation of class theory.
Canadian liberalism predates Confederation, and in fact, may have been hampered due to a centralized colonial union. Nevertheless, Canadian liberalism originated as a reaction to the Tory oligarchy. In Upper Canada during the early 1800's, the aristocratic elite were known as the Family Compact; wealthy, educated and politically well-connected to the British homeland, the Family Compact were the defacto rulers of what is now modern-day Ontario. The rebellions of 1837 more or less put an end to this despotism.
The Family Compact were in fact the original Tories. Toryism can be defined as a collectivist ideology, a form of nationalism that places 'God, King and Country' above individual liberty. In addition, Toryism is traditionally anti-democratic and anti-free market.
Canadian liberalism, on the other hand, is concerned with liberty and the constraint of unnecessary and arbitrary power over the individual. As government is essentially a means of monopoly force, its power always needs to be checked by a well-informed voting public. During the 20th century Canadian liberalism drifted from its classical underpinnings and moved toward a more socialist aspect. This "social liberalism" ignored the class divisions between state power and civil society. For these reasons, state intervention was welcomed as a cure to social and economic problems. Likewise, the voting public came to feel as if "we" were the government, rather than considering the monopoly institution as a force to be reckoned with. A necessary evil, as it were. While the policies Pearson, Trudeau, Chretien and Martin may have been appropriate for their time, the result has been a Canadian society that is predominantly collectivist. Additionally, the expanded state apparatus has left open a door for ruthless, secretive leaders like Stephen Harper to acquire near absolute power.
Because social liberalism expanded the power and influence of the state, democracy came under attack. As Professor Ludwig von Mises points out,
"Representative democracy cannot subsist if a great part of the voters are on the government payroll. If the members of parliament no longer consider themselves mandatories of the taxpayers but deputies of those receiving salaries, wages, subsidies, doles, and other benefits from the treasury, democracy is done for."
The fall of the Liberal Party of Canada can trace its roots to the abandonment of classical liberalism and disregard for non-Marxist class analysis. The social liberalism of the 20th century has been shown to be just an insidious form of communism. Instead of balancing individual and collective rights, the Liberal Party chose to satisfy voters with short-term initiatives* that put a large percentage of the Canadian electorate on the public payroll. Hence, the rise of the socialist NDP as generations of Canadians are now accustomed to an all-powerful state handing out entitlements as if they were natural rights. Most Canadians are unaware that it is freedom from coercion that makes a free society - not a centralized bureaucracy transferring wealth from productive to non-productive sources.
But what's done is done. Now question remains: should the Liberal Party merge with the NDP or return to their classical liberal roots? Clearly, the "rebuilding" going on right now under Bob Rae and Mike Crawley is nothing short of empty partisan attacks on Harper and a blatant denial that for the last few election cycles there has been virtually no discernible difference between Liberal and NDP election platforms. A merger will end in a two-party system where Canadians will find themselves with fewer options at the ballot box. Counteracting Tory collectivism with a united left-wing collectivist party will end Harper's regime but to what extent? Will there really be a changing of the guards if individual liberty remains suppressed?
To the man who adopts the scientific method in reflecting upon the problems of human action, liberalism must appear as the only policy that can lead to lasting well-being for himself, his friends, and his loved ones, and, indeed, for all others as well. - Ludwig von Mises
*Short-term initiatives is simply another term for the welfare state. The "third way" is proving to be a failure. As the state cannot produce wealth, it can only take, younger generations are finding themselves inheriting a debt that is not theirs, social services are disintegrating and going bankrupt while taxes are higher every year and the purchasing power of money is dwindling. A mixed economy is a failed collectivist experiment that has replaced a genuine free market with a crony capitalist system and a creeping police state.