American Constitutionalism

The balancing mechanism took its most mature political form in the writings of the Federalists and the structure of American government.⁴⁰

Much as virtue and duty informed the Federalists' normative positions, a realist perspective on human nature permeated many of their key institutional prescriptions. Fear of vice and conflict lay under the mechanisms of government: factions deeply concerned Madison, who saw them as an inevitable result of even “the most frivolous and fanciful distinctions,” especially of “the unequal distribution of property.” The division of society into divergent interests “grows up of necessity,” out of the diverse “faculties of men.” “This propensity of mankind to fall into mutual animosities” is so strong that it is not possible to remove the causes of faction: attempting to give every citizen the same passions, opinions and interests is “impracticable” (Federalist No. 10, 319–20).⁴¹

The Federalists dealt with the problem of faction mainly in two structural-institutional ways. First, they instituted a large republic with a representative system that would allow multiple interests to balance each other (Federalist No. 10).⁴²

Second, the Federalists adopted the principle of the separation of powers.⁴³ They designed a system whereby each branch of government saw its interest in balancing abuses by the other. Further, different forces were to be mixed within each branch, so that none was controlled by any one interest (Federalist No. 62). The danger was especially pertinent to the legislative branch, which could degenerate into a tyranny of the majority (Federalist No. 48). The solution was that

In the twentieth century the balancing principle, though transformed in important ways, remained central in the new public philosophy of “interest-group Liberalism,” the dominant paradigm in American politics that adjusted pluralism and capitalism to the dynamics of industrial society.⁴⁵

Special interests, now organized in groups, were assumed to balance each other, producing a vector of forces that would prevent the domination of any group.⁴⁶ The theory was explicitly realist and dismissive of ideas.⁴⁷ After the 1950s and 60s, the pluralist paradigm suffered an onslaught from every direction: public choice theory, elite and organization theory, social movement theory, to name the most important. However, the ways in which the pluralist template has been modified by modern socioeconomic developments continue to be explored.⁴⁸ Many seek to analyze the dynamics of interest groups counteracting each other, some explicitly addressing the realist caveats of Schattschneider,⁴⁹ others from the normative perspective of “the public good.”⁵⁰ Overall, Americanists have dissected the pluralist and balancing claims almost to extinction, for the same reason that IR scholars and economists have: practice never lives up to theory. However, when “checks and balances” fail in politics, no one rejects the principle. Instead, they seek to counterbalance concentrations and abuses of power. They do so not in order to preserve the system, but to defend their own, just as Liberal theory would predict. In fact, much of American politics examines the institutional preconditions and failures of partial political equilibria.⁵¹

Economic Liberalism

The assumption of self-interest aggregating to the social welfare underlies the economic Liberalism of the eighteenth century.⁵²

Adam Smith did not support free trade because of a benign view of merchants or manufacturers.⁵³ To the contrary: “People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices.” Smith attacked merchants with an intensity never matched in his critiques of bad government. Mercantilism was created to serve the interests of the manufacturers, who would not hesitate to exploit their workers in order to raise prices.⁵⁴ The “wealth of nations” did not depend on a desire to serve the public good—instead, Smith claimed, he had “never known much good done by those who affected to trade” for such a purpose. Rather, collective wealth was the result of the selfish pursuit of gain, and the individual “is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention.”⁵⁵

A major misconception is that Smith predicted a “spontaneous balance” in the economy as a whole, whereas in fact he saw it only in well-circumscribed domains. For instance, in price formation, an equilibrating mechanism ensured that the natural price adjusted to allow supply to meet effectual demand. Similarly, in the labor market, the advantages and disadvantages of the different employments of labor and stock would “in the same neighbourhood, be either perfectly equal or continually tending to equality.” Yet, the process was thwarted by the restrictions on labor imposed by guilds and corporations with the aim of limiting competition and keeping wages high—what Smith called the “Policy of Europe.”⁵⁶

Further, as I expand in the section “Liberalism, Old and New,” Smith understood that equilibrium solutions were undermined by the incentive structure of mercantile groups. Nevertheless, his ideas were transmitted in the nineteenth century in a simplified way, and “spontaneous equilibrium” degenerated into the extreme forms of laissez-faire. This free-market orthodoxy was radically challenged by the crisis of the 1930s; penetrating critiques of the system pushed laissez-faire to the conservative side of the spectrum.⁵⁷

The invisible hand was thus transformed into a conservative rather than Liberal idea, a combination of Smith and Burke, deemed incompatible with the kinds of state intervention the recent crisis had shown to be necessary.⁵⁸

However, the balancing mechanism still underlies qualified defenses of the Liberal capitalist system: in Galbraith's theory, the concentration of power in the hands of capitalists would be offset by the “countervailing power” of trade unions, supplier and consumer organizations, and government regulation. Economists continued to seek mathematical proof of the existence of the perfectly competitive equilibrium, only achieved by Arrow and Debreu in the 1950s. Recent developments in the new information economics seek to redress market failures in order to approximate equilibrium conditions. And even within the most radical challenge to the unrealistic assumptions of orthodox economics—complexity theory and agent-based simulation—we find an attempt towards a better-grounded, dynamic account of general equilibrium.⁵⁹

International Liberalism

In international politics, following Doyle's seminal article, most analyses of Kant's Liberal theory of international politics have focused on the three Definitive Articles for Perpetual Peace: a republican constitution, a federation of free states, and a cosmopolitan right to hospitality.⁶⁰

The key to Kant's argument is the dialectical nature of his predictions, which can only be tested against trends over time rather than discrete events, as Cederman has argued.⁶¹ The definitive articles are thus the constitutive elements of the thesis, but the causal account Kant provides is evolutionary. The latter has received little attention, thus much attenuating the force of the thesis, though it was highlighted by Doyle.⁶² Eventual pacification required a distinct political process for Kant, one which he analyzed in the “First Supplement on the Guarantee of Perpetual Peace.” The process is composed of three elements, though scholars usually invoke only the third, the “spirit of trade.” However, it is the “mechanical process” of “that great artist nature” that permits “harmony to emerge among men through their discord, even against their wills” in the account.⁶³ This is the same mechanism seen at the core of political and economic formulations of Liberalism.

After admitting that war “appears to be ingrained in human nature,” Kant outlines this mechanical process, which operates on three levels: the formation of republics, their interaction as separate nations, and the effects of trade. On the first two levels, the process is clearly predicated on the balancing principle. For the formation of republics, Kant rejects two common beliefs, that “a republic must be a nation of angels,” and that “men's self-seeking inclinations make them incapable of adhering to so sublime a form of government.” Rather, the cunning of nature marshals these “inclinations” and thus assists reason, which is “impotent in practice.” Full rationality may not be in man's power but “organizing the nation well” is. These “self-seeking inclinations” are so arranged in opposition within the state “that they are able to direct their power against one another, and one inclination is able to check or cancel the destructive tendencies of the others.” Each inclination is thus neutralized by its counterpart, and “man, even though he is not morally good, is forced to be a good citizen.” So “even for a people comprised of devils,” government can be created “if only [these devils] possess understanding.” The problem of government for Kant is a Stag Hunt: rational beings “require universal laws for their preservation”; but “each is secretly inclined to exempt himself from such laws.” Therefore, government must be organized in such a way that, while men's “private attitudes conflict,” self-interests “so cancel one another that these beings behave publicly just as if they had no such evil attitudes” at all.⁶⁴

Kant's mechanism has been noted by philosophers; for Habermas it is the principle that undergirded the “sociological conditions for a public sphere,” comprised of “freely competing commodity owners.”⁶⁵

The same balancing mechanism will lead towards eventual peace at the international level. It is predicated on the existence of “many separate, independent” nations. It thus ensures that a “soulless despotism” of a “universal monarchy” does not emerge. It is, moreover, naturally ordained: even though every nation would desire an enduring peace under its domination, i.e. hegemony, “nature wills otherwise. She uses two means to prevent peoples from intermingling and to separate them, differences in language and religion, which do indeed dispose men to mutual hatred and to pretexts for war … Unlike that peace that despotism (in the graveyard of freedom) brings about by vitiating all powers, this one is produced and secured by an equilibrium of the liveliest competing powers.”⁶⁶

The practical mechanisms in Kant's scheme have been neglected, especially so in IR. Kant's idealism partly accounts for this, but it is also because Kant described, rather famously, the balance of power in international politics as a “mere figment of the imagination, like Swift's house, whose architect built it so perfectly in accord with all the laws of equilibrium that as soon as a sparrow lit on it, it fell in.”⁶⁷

However, the “balance of power” was, by the time of Kant, conflated with the practices of Realpolitik, such as the partition of Poland—and I will argue that such practices were clearly understood to undermine the kind of freedom-preserving equilibrium that is the focus of this article (and Kant's thinking). Kant's critique therefore addressed the deliberate means statesmen adopted at the time, rather than the principle itself. “[A]n equilibrium of the liveliest competing powers” was, instead, how Kant conceived of gradual pacification.

Kant's “realism” was noted by Waltz in an early and astute article, where it is treated as an exception among the generally optimistic Liberal philosophy of the eighteenth and nineteenth centuries. “While Kant may be seen as a backsliding Liberal, he may also be considered a theorist of power politics who hid his Machiavellian ideas by hanging round them the fashionable garments of Liberalism.” In the light of my analysis, this element in Kant is not an anomaly, nor an instance of concealed beliefs, but a natural extension of a long-standing tradition based on the balancing mechanism.⁶⁸

I have argued that Liberalism relies on a specific prediction about how narrow interest aggregates at the collective level. This core intuition is found across different authors, varying greatly in orientation, subject, and period. Yet my account will seem troubling to most IR scholars, if not irrelevant to the traditional definitions in the field. It goes against common perceptions of Liberalism as synonymous with rationality, malleability, progress, harmony, cooperation, and optimism—in other words, for some, with gullibility and naivety. Is my account then misguided? I argue that these common perceptions have unduly limited the scope of Liberalism, by neglecting the mechanism that generated the success of Liberal politics in public life. The perceptions reflect instead two separate traditions that were gradually identified with Liberalism: idealism and utilitarianism. Most contemporary Liberal IR has strong utilitarian roots and a rationalist core.⁶⁹

Below, I will explain the deep tensions between utilitarianism and classical Liberalism, and show how utilitarianism transformed our conception of Liberalism. Though these tensions are real, I conclude this section by showing the progressive elements of the classical version of Liberalism and by explaining why Liberalism today should reclaim the old balancing idea.

Liberalism, Old and New

When Realists inveigh against the naivety and optimism of Liberalism, it is instead utilitarianism, rationalism, idealism, or moralism that they have in mind.⁷⁰

Today, these theories are considered part of a “new” Liberalism, whilst classical Liberalism is seen as a conservative theory, and thus akin to Realism. I will show that these new theories are “non-liberal” in some key respects and that such a conflation or misnaming of the old and new is problematic. At the same time, however, I will argue that the classical version of Liberalism shares with the more progressive contemporary one a concern with inequalities and distributional failures. On these important dimensions, classical Liberalism lies closer to what today we call Liberalism than to conservative approaches that take steep inequalities as naturally given and inevitable features of social organization—indeed, this can be taken as a litmus test to distinguish the two political sensibilities. In other words, we need to reclaim the progressive aspects of the classical Liberal vision from conservative misinterpretations. Any robust vision of Liberalism for the future needs to reconcile the old and the new.

Take, for instance, the claim that Liberalism predicts peace through commercial interdependence. This notion in fact stems from the radical utilitarian assumption of the beneficial effects of trade at the international level, a view expounded by Bentham, but more emphatically by Cobden and the Manchester School.⁷¹

As Keynes stated, it was only in the nineteenth century that the “conservative individualism of Locke, Hume, Johnson, and Burke [and] the Socialism and democratic egalitarianism of Rousseau, Paley, Bentham, and Godwin” were brought together in the doctrine of laissez faire. It was the Manchester School and the Benthamite Utilitarians that made laissez faire into a dogma.⁷² But it is important to note that the classical Liberal approach I have outlined is more complex. Smith is commonly assumed to be one of the progenitors of laissez faire.⁷³ He did argue that free trade increased the wealth of nations. He showed how the spread of trade in luxuries steered landlords away from war to the acquisition of goods, thus pacifying towns and countryside. This is still the model of narrow self-interest unintendedly aggregating to domestic welfare. He also pointed out that commerce between wealthy nations was advantageous to all parties.⁷⁴

But he clearly stated that the same trends also caused deep conflicts among powerful countries that could not be easily overcome, and that the establishment of full free trade was a utopian expectation even for the Britain of his time: it ran against “the insolent outrage of furious and disappointed monopolists.” At the same time, he described how technological developments made “modern war” an expensive enterprise, in which only a wealthy nation could succeed. And he affirmed it was the duty of the sovereign to provide for such needs by a standing army, as the only means through which “the civilization of any country can be perpetuated, or even preserved for any considerable time.” The “wealth of a neighboring nation” was “certainly advantageous in trade”, but “dangerous in war and politicks.”⁷⁵

Classical Liberals acknowledged the benefits of free trade, but could remain skeptical about the immediate possibilities of its full implementation.

The old and the new Liberalisms thus have important differences: traits currently seen as Liberal are utilitarian in origin. The two approaches are in considerable tension, in fact. Utilitarianism, as modified in contemporary understandings, is distinguished by two assumptions.⁷⁶

First, all preferences have a common denominator: rationality. Second, a bargaining space always exists, within which solutions can be found to reconcile initially conflicting demands. Utilitarians are the real radicals. Human interests are negotiable, divisible, and exchangeable.⁷⁷ The concept of an indifference curve—whereby one good can be substituted for another—represents the measurable expression of this idea (with the important substitution of measurable preferences for utility). These principles lead to the expectation, if not of a harmony of interests, at least of a possible bargain.⁷⁸ By contrast, classical Liberalism is predicated on the idea that not only may values or preferences be irreconcilable, but that the task of politics is to tolerate a plurality of divergent views and secure their autonomy—to the degree that they do not threaten the liberal order itself.

Utilitarianism and Liberalism stem from opposing philosophical foundations. The concept of utility itself was advanced by Bentham as a direct attack against two core Liberal beliefs: natural rights and the social contract. The former were “nonsense on stilts,” the social contract equally deprived of independent value.⁷⁹

In later utilitarian thought, key ideas were gradually modified, especially by J. S. Mill, but they encapsulate differences that are still salient. Utilitarianism has been criticized as illiberal, especially in its egalitarian inclinations. However, the concept of a Pareto equilibrium is not inherently egalitarian, as the concept of equilibrium itself makes no necessary assumptions about the relative merits of the distributional arrangement for society as a whole, only its relative value for each actor in the game.⁸⁰

The two theories also prescribe different mechanisms to generate collective outcomes. The key Liberal mechanisms are separation of powers and checks and balances between different arms of government—in short, institutional differentiation. By contrast, institutions for utilitarians are “congealed prejudices,” whose permanent character turns them into mobilizations of bias, rather than expressions of preferences.⁸¹

Accordingly, utilitarians rejected representative institutions in favor of voting and direct participation that would produce the “happiness of the greatest number”—hence the Radicals' support for universal suffrage, intitially rejected by the Liberal Whigs. And hence the continuing distrust of democratic theorists towards Liberal interest group politics.⁸²

The sharp differences between the two approaches raises the question of how they become conflated, especially in the Anglo-American context. A full answer would exceed the boundaries of this article, but some major points can be easily discerned. First, classical Liberalism from its origins incorporated both “conservative” and “radical” elements, especially in the work of Locke, which was fundamental for the American political tradition.⁸³

Then, in the nineteenth century, John Stuart Mill formulated a utilitarian interpretation of classical Liberalism—and Mill's role in modern conceptions of Liberalism was definitive. The principles of free trade were popularized by Benthamite utilitarianism and the Manchester School in the late nineteenth century. However, free trade morphed into a conservative theory, with an influential exponent in Herbert Spencer. Spencer advocated a potent mix: extreme conceptions of laissez faire tied to Darwinian evolutionism and strong anti-statism (which is closer to how classical Liberalism is sometimes conceived today). Spencerian evolutionism, finally, triggered the progressive, modern interpretation of Liberalism in response. Most notably, strong state interventionism in regulation and redistribution and an organic conception of the Liberal state were shown to be necessary to secure Liberal goals, especially in the work of Hobhouse.⁸⁴ Liberal conceptions of the market thus degenerated into simplistic defenses of laissez faire by the early twentieth century, at the same time as progressive and reformist ideologies became increasingly tied to a statist and interventionist approach. Since the former were by now deemed conservative, state interventionism acquired the label of Liberalism instead. The economic crisis of the 1930s, which undermined the notion of the economy as a self-regulating mechanism and elicited the New Deal, consolidated this intellectual slippage.⁸⁵

Shifting back to IR, the common perception of balance of power theories, with their laissez-faire implications, as conservative or Realist and as antithetical to Liberal principles is easily seen as part of a broader intellectual movement. In the next section I will trace the parallel transformation of the concept within IR.

This leads to an obvious objection: if Liberalism as here defined is no longer recognized by modern Liberals, why resurrect this definition within IR? Addressing this objection is crucial, as it provides the core justification for my argument. I argue that Liberal theory, in both its domestic and its international variants, should cede neither self-interest nor power nor the balancing mechanism to its conservative opponents.⁸⁶

These factors are too important to be relinquished and, in any case, they have historically provided the institutional foundations of a Liberal order.

The work of Adam Smith offers powerful evidence in support of this argument. Smith shows that the classical Liberal tradition does not assume spontaneous, automatic equilibria and that it has a robust understanding of the need for government. His views are thus closer to contemporary understandings of Liberalism than to conservative economic positions. His notion of the invisible hand has been the main source of misunderstanding. Yet by no means does it imply the spontaneous emergence of equilibria in the economy as a whole. Only the self interest of laborers and land owners coincided with the general interest of society. By contrast, Smith showed how the interest of merchants and manufacturers, who live by profit, was often “opposite” to that of the public. Moreover, he highlighted a crucial information asymmetry: mercantile classes always knew what their interest was, and would deliberately deceive the public to implement it through state policy—while the laborers and landlords were misguided or often ignorant. Policy thus had to be carefully selected; the “science of the statesman and the legislator” was crucial in creating the “wealth of nations.” For instance, regulation in favor of the workers was “always just and equitable.” Low wages were detrimental not only to the economy, but to society as a whole: Smith advocated for the needs of the poor on a utilitarian and a humanitarian basis at many points. Far from a “laissez-faire” thinker, he thought that taxation should be used to create incentives for optimally productive use of capital, even to discourage “spendthrift” tendencies of the landowning classes. And the sovereign was crucial in fostering such practices.⁸⁷

Even the bêtes noires of economics, the neoclassical marginalists of the nineteenth century and later, were deeply concerned with social justice and welfare, again contrary to common perceptions. Walras developed general equilibrium theory, yet he advocated the reclamation of all lands by the state so that land rent could replace taxation as a source of government revenue. Edgeworth proposed (and Hotelling proved) that taxation could decrease the price of a good, articulating a utilitarian theory of progressive taxation. Pigou developed welfare economics; he first distinguished private and social marginal products, and identified their divergence as a frequent occurrence requiring government intervention (a position critiqued by Coase). He advocated redistribution to increase economic welfare. With important differences, so had Marshall, taxation being the instrument of choice. And after Robbins rejected interpersonal comparisons of utility, the modern theory of optimum welfare under pure competition was retained by Abba Lerner and Oscar Lange—as socialists, they could continue to accept “the postulate that men are equal in their ability to enjoy life.”⁸⁸

Economics was consolidated as a conservative discipline in the 1950s and 60s, especially with the Second Chicago School, under George Stigler and Milton Friedman, and with the new classical macroeconomics of Robert Lucas in the 1970s. It is these approaches that hold that “abuses of private power will usually be checked, and incitements to efficiency and progress usually provided, by the forces of competition.”⁸⁹ Classical Liberals were not as sanguine.

The main adversary to the Chicago school has been the new information economics developed by Joseph Stiglitz and others. It has shown that imperfect and costly, or asymmetric, information, as well as incomplete markets, necessarily lead to market failure and that income distribution matters for economic efficiency: egalitarian concerns are thus not exogenous to economic analysis. The role of government intervention and institutions, in this approach, is clearly aimed to ensure that equilibrium economics fulfill their promise, not to jettison the idea.⁹⁰

With the information revolution placed in the context of equilibrium theory in economics, we can see the role of information in IR institutionalism under new light. It is clear that the symbiotic relationship the latter has always had with balance of power theory (in the form of neorealism) is perfectly consistent with parallel developments in economic theory. The purpose of institutions in economic theory (as in IR) is to purvey information, reduce transaction costs, and thus to allow more efficient “contracting.” Theorists introduced contracting and strategic bargaining as a sharp critique of the unrealistic assumptions on automatic, costless market clearing of traditional equilibrium theory. They sought to model the dynamics of price-mediated exchange with greater (theoretical, not empirical) realism; and, though this will come as a surprise to some, game theory was introduced to perform this task.⁹¹

Game theory in IR has similarly been used to articulate the role of bargaining in selecting from multiple self-enforcing agreements. It has shown how information is necessary to articulate the logic of the “balance of power and interests.”⁹² The parallel economic trajectory shows how IR institutionalism and game theory have always had an organic conception to balance of power theory, and that this was not the result of a “weak” liberalism on the part of its proponents.⁹³

However, the economic logic made IR scholars subject to the same pathology as in orthodox economics: a neglect of power.⁹⁴

Domestic politics, by contrast, predicated as it is on power differentials between groups, offers a better analogy to international dynamics. International equilibria are, after all, much closer to political balancing than to market clearing; in the market, excessive supply will be balanced by decreased demand, whereas in the international system, hegemonic bids need to be met by equal counterforces. Other important differences remain, amplifying the point that these are analogies, not direct applications of one logic to different domains.

In the previous sections, I have argued that the balance of power is a key Liberal notion. I now use this insight to clarify some concepts in IR theory. First, I show that theories conventionally classified as Realist, like Waltz's, draw their explanatory power from the core Liberal mechanism. Then, I explain this slippage by arguing that balance of power came to be seen as ‘Realist’ through the conflation with Realpolitik and reason of state. These three concepts, balance of power, Realpolitik, and reason of state, are usually taken as a unit, but the latter two are analytically distinct; I argue that their conflation is contingent, emerging in nineteenth century German idealist thought. Realism should also not be identified with the ‘state-as-unitary-actor’ hypothesis, and I show why Liberal critiques on this point are misguided. Having cleared the definitional ground, I then define Realism in a way that adequately differentiates it from Liberalism and brings it in sync with the use of the concept in American politics and political theory.

Balance of Power is realist, but not Realist: Adam Smith Goes Security⁹⁸

See footnote 5 for definitions of realism used in this article.

Waltz's Theory of International Politics is arguably the most important statement of the past half-century in IR theory. As such, it has been systematically attacked, primarily for its realism. Its focus on the state as the unit of analysis has also been a target, since important changes in the international system are thought to make the state obsolete. Such criticism is misplaced: the focus on the state is a theoretical assumption for Waltz, a necessary element neither of balance of power theory, nor of neorealism for that matter. Moreover, as unipolar tendencies emerge in the international system, rather than see a decline in the importance of neorealism, we can expect its relevance (and Liberal character) to become even more apparent.

Waltz's theory has been classified as Realist, as it is predicated on the balance of power. However, in light of my analysis, Waltz's theory falls squarely within the classical Liberal tradition. Further, the “neo” aspect of neorealist theory originates in microeconomic theory. The analogy of microeconomics is not simply a heuristic device, but captures a fundamental conception of how unit behaviors aggregate. More specifically it embodies the Liberal assumption of a self-calibrating system. Scholars have noted the analogy of course,⁹⁹

but not its Liberal implications. The major critiques have focused more on the individualist, utilitarian foundations of the theory and the limitations of a structuralist approach, as well as the tensions between the two.¹⁰⁰ The conflict between a microeconomic analogy and a “Realist” orientation has drawn less attention, though Keohane noted the conflict between balancing and power maximization. Schweller was the first to systematically point out the tensions in Waltz's argument.¹⁰¹

In neorealism, the mechanism that generates outcomes originates in the Smithian logic. Critics have found this mechanism unsatisfying, given Waltz's stipulation that a balance does not require balancing behavior on the part of the actors.¹⁰²

But this is the core of the Liberal insight: what Waltz means is that it is not necessary for any state to act with the explicit intention of producing a balance; it simply has to want to survive, or otherwise act in a self-interested manner.¹⁰³ Balances will emerge if a sufficient number of states act in a self-preserving way, even though such a systemic outcome was not their intention. “Obviously,” he adds, “the system won't work if all states lose interest in preserving themselves.” His target is theories that ascribe balances to “a shared vision of Europe” among leaders, as exemplified in the Concert of Europe, or to the presence of a functionally differentiated state, that of the “balancer.”¹⁰⁴ For Waltz, these are neither necessary nor sufficient conditions for a balanced outcome, though they do indeed often occur. Instead, a balance (as public good) is at a minimum the unintended consequence of the actions of states willing to survive (private utility).

In any case, the market analogy is clear. No one has to intend the public good for it to materialize, only his or her private gain. This is, arguably, the genius of the Liberal solution to the pervasive problem of self-interested human action (and, needless to say, it fails about as often as it succeeds, but we are arguably all better off when it does succeed). It is also not a claim predicated on individual rationality. Waltz's system requires simply the evolutionary rationality that is expressed at the structural, not the individual level; Alchian resolved the problem of market rationality in a similar manner, by attributing rationality to the industry as a whole, rather than to the individual firm—as Kant had done in a different context.¹⁰⁵

Reclassifying Waltz in this manner allows us to explain the paradox of his influence among Liberal scholars and the strong criticism he has received from classical realists.¹⁰⁶

Balance of Power is not Realpolitik nor Reason of State, Not Necessarily

So how was balance of power identified with Realism? This occurred when balance of power became associated with three separate concepts, each of which has also been thought central to Realism: Realpolitik, reason of state, and state-centrism. However, a closer look shows that these concepts are only contingently related. In this section, I analyze the first two separately. Realpolitik is thought to denote a host of practices, such as secret alliances, partitions, and interventions, which excite vehement opposition by Liberals. However, just as checks and balances in domestic politics were not meant to imply the Realpolitik of bribery and corruption (which is often in practice the case), so the balance of power does not in theory require anything beyond efficient alliance formation or self help. The connection of Realpolitik and balance of power is a practical, not a theoretical, definitional one. The same is true for the principles of raison d'état. In what follows, I offer one explanation of how these two separate strands came together to redefine balance of power as inherently statist and Realist. In the next section, I show why state-centrism is equally not integral to either Realism or balance of power.¹⁰⁷

Realpolitik refers to “practical politics; policy determined by practical, rather than moral or ideological, considerations.”¹⁰⁸

It is, therefore, a behavioral concept, not a structural one. One of its most influential expositions is by Machiavelli, in The Discourses and The Prince.¹⁰⁹ Realpolitik, however, did not necessarily imply a commitment to balance of power. Machiavelli advocated it to achieve primacy. Nowhere did he make a defense of balance of power as a guide to statesmanship or a desirable outcome for Italian politics (the practice of divide et impera was a means to primacy, not balance). Machiavelli's “remarkable” omission has often puzzled scholars.¹¹⁰ However, it is not surprising. Instead, Machiavelli sought unification, under a strong ruler. His republican writings were equally imperialist in orientation. Balance of power was important, by contrast, in the historical and political works of the humanist Guicciardini: according to him, Italian states needed to preserve the balance between them, mainly to stem Venetian growth, as achieved by Lorenzo the Magnificent.¹¹¹

Realpolitik has long been thought necessary to produce a balance of power through practices such as covert diplomacy, partitions, and breach of agreements, all of which violated Liberal principles. However, in theory at least, the only necessary corollary for preserving a balance is the unobstructed capacity to form alliances.¹¹²

In fact, forceful partitions to artificially maintain a balance were recognized by proponents of balance of power as its undoing. For instance, Gentz was a Prussian participant at the Congress of Vienna on the Austrian side, and author of a sustained defense of the principle. In his second chapter, however, he described “the Shock given to the Balance of Power by the Introduction of the Partition System.” He claimed the decline of the old European system began with the partition of Poland; the “system of partition” was an “abuse” and “perversion” of the old form, in the service of “bad purposes.”¹¹³ Partitions and Realpolitik are by no means integral to the balance of power.

The conflation with Realpolitik is one reason Liberals reject balance of power; the other is the latter's presumed commitment to “reason of state” principles. However, our contemporary notion of reason of state stems from the German statist tradition of the nineteenth century, which had only a historically contingent relation with balance of power. The connection between reason of state and balance of power required two steps to emerge. The emergence of a new Idealist notion of reason of state was the first step. Rather than reject morality, German notions of Reason of State turned the realization of the state into the highest moral value for the community. The state alone allowed the nation to fully actualize its potential and nature. Reason of State became the “vital principle, the entelechy of the state;” it was the “fundamental principle of national conduct, the State's First Law of Motion. It tells the statesman what to do to preserve the health and strength of the State.”¹¹⁴

Pragmatic politics allowed the State to survive in the struggle of world politics. However, this organic, Idealist conception of the State introduced a moralism that was a crucial departure from Realist principles, though we fail to realize this (I come back to this in the next section).

After Reason of State became an Idealist concept, it fused with balance of power through historical contingency: the balance became the mechanism safeguarding the State in the context of nineteenth-century German political history. Ranke's work exemplifies this process.¹¹⁵

He thought states could achieve and preserve their individual nature only within a well-functioning balance of power system. Ranke's understanding of history was enmeshed in the transformation of Germany following the Napoleonic Wars. He defended the co-existence of multiple German states, a status quo that could only be preserved through a balance of power. Ranke thus opposed Prussian expansionism, a cause championed by the Liberals and the newer generation of historians, Droysen most notably. He was perceived as conservative vis-à-vis the Prussian school, which was Liberal and nationalist at the same time, and which placed history at the service of national unification. German Liberals attacked the balance of power as a reactionary principle, and they identified it with non-democratic practices such as covert diplomacy. They advocated the use of public opinion to guide and restrain international behavior instead.¹¹⁶ In this way, paradoxically, the definition of balance of power politics as a conservative, non-Liberal approach to politics was consolidated in the German context.

However, this conflation was a contingent rather than a necessary one. It is true that the balance of power was also supposed to uphold the monarchical, conservative order that culminated in the Concert of Europe: balance seemed opposed to motion, change, and social progress.¹¹⁷

However, the core intuition behind a balance is to preserve the independence of each balancing unit. There is nothing inherently conservative in such a vision. Two main reasons support this view. First, a balance can be invoked to preserve Liberal states just as much. In fact, the logic driving the German defense of a balance of power is an inherently Liberal one, if by the term we mean a political system aimed to preserve the individual, however the latter be conceived. The argument simply requires the mental jump of substituting the state for the individual. Balance of power emerged as a response to bids for “universal monarchy” by the Spanish and French royal houses in the sixteenth and seventeenth century.¹¹⁸ Ranke's writings illustrate the conceptual affinity. For him, each state had an inherent value, and its independence from others was a supreme value that ought to be preserved. Neither hegemony, nor a union of all would ensure harmony (in this, echoing Kant). “Decided, positive prevalence of one [state or nation] would bring ruin to the others. A mixture of them all would destroy the essence of each one. Out of separation and independent development will emerge the true harmony.” Transposed to the level of the individual agent, this argument could have been made by a nineteenth-century or contemporary Liberal. Indeed, as Tuck and others have argued, the liberal understanding of the individual was derived from the notion of the sovereign state.¹¹⁹

There is a second reason we want to question the conservative character of the balancing principle. We tend to see balance of power and Liberalism as opposed because a balance is understood to imply a commitment to the state, and the state is also seen as a constraint on Liberalism and individual rights. I criticize this view in the following section.

Balance of Power and Realism Do Not Imply State-Centrism, Not Necessarily

So far, I have suggested that balance of power is best distinguished from Realpolitik as much as from Reason of State. State-centrism is another concept commonly associated with Realism and the balance of power; “the state as unitary actor” is seen as the foundational principle of Realism—in fact, as the only assumption now shared by the multifarious versions of the theory.¹²⁰

Yet, the concept is hardly salient in such “paradigmatic” realists as Carr and Morgenthau, but the discrepancy is rarely taken as significant.¹²¹ This is a serious misapprehension, resulting in concepts that are analytically flawed and the source of pervasive confusion. Realists, more than anyone, need to reject the statist assumption, even if claims of the decline of the state as an international actor are premature—this is an unnecessary challenge to their approach. Neorealists called for this early on: “The logic of anarchy obtains whether the system is composed of tribes, nations, oligopolistic firms, or street gangs.”¹²²

The association of Realism with the black-box notion of the state is pervasive, but intellectual history shows it is misguided. The idea of the state as a unitary actor originates in Idealism, a tradition deeply antithetical to Realism, as Palan and Blair have persuasively shown.¹²³

In their analysis, statism is traced to Hegelian Idealism and to artificial notions of organic unity in a much more elaborate manner than I have indicated above. This suggests that the common assumption of an alternative, Hobbesian origin to the connection between Realism and the state neglects the actual intellectual history from which it sprung.¹²⁴ The Hobbesian connection, though valid in some ways, has been invoked ex post, and, further, it cannot account for the pervasive connections with balance of power.¹²⁵

The identification of state-centrism and Realism can be rejected for two reasons. First, such slippage departs from the meaning of the term “realism” in ordinary language use. Realism denotes a “tendency to regard things as they really are; any view … contrasted with idealism,” or, “the view that actual political power is the subject-matter of politics, as opp. to doctrine, law, rights, or justice.¹²⁶

It is not connected to the idea of states as the core unit of analysis either lexically, logically, or philosophically; there is thus no warrant, except for misguided practice, for the term “Realism” to imply a statist approach in IR.

Second, the equation of Realism with state-centrism is often motivated by a Liberal hostility towards the state; both Realism and balance of power are assumed to privilege the state at the expense of individual rights. However, a strong state is necessary for Liberal politics at the domestic level, as some Liberals often forget. It underlies an effective welfare state that can protect all citizens from market failures.¹²⁷

Instead of the state, Liberals should target the concentration of power in elites that claim to defend “the national interest” when the latter is not the product of Liberal pluralist politics.¹²⁸ The longstanding Liberal critique of the state commits the fallacy of attacking a particular form of political organization, the state, when the real problem is with a recurrent property of any form of political or social organization, concentrations of power.