Delivered on February 20, 2007

From Hong Kong in the South China Sea to Dublin in the Irish Sea, a Freedom Curtain has descended across the world. Behind it lie almost all the capitals of the ancient states of Europe, Asia, and Latin Ameri­ca-London, Paris, Berlin, Prague, Budapest, New Delhi, Tokyo, Mexico City, and Santiago.

All of these famous cities and the populations around them lie in what I might call a sphere of free­dom, and all are subject, in one form or another, not only to regional forces, but also-to a very high and in many cases increasing measure-to a global tide of political and economic freedom.

You will recognize, of course, my 2007 version of Winston Churchill's famous "Iron Curtain" speech in March 1946 that defined the beginning of the Cold War. Churchill's blunt warning about the imperialistic intentions of the Soviet Union disturbed some in the West, but there was no denying the war leader's geo­political acumen.

A year after Churchill's speech, a small group of free-market economists, historians, philosophers, and other students of public affairs, led by the London School of Economics' Friedrich von Hayek, met in Mont Pelerin, Switzerland. They declared that "the central values of civilization" were in danger. Over large stretches of the Earth's surface, they said, the "essential conditions of human dignity and freedom have already disappeared. In others they are under constant menace."

Those who gathered in Switzerland called them­selves classical liberals, successors to John Stuart Mill and similar 19th century thinkers, but Hayek would come to admit that the word "liberal" was expropri­ated by the Left. So when I say "liberal," I mean the modern liberal whose appetite for ever more gov­ernment is apparently insatiable. And when I say "conservative," I mean the modern conservative of the United States and the lower-case "c" conserva­tive in the United Kingdom who turns to govern­ment as the court of last resort, not the first.

The Mont Pelerin Society was founded in the spring of 1947 when the whole world was turning left and there seemed to be no turning back. East­ern and Central Europe groaned under Soviet domination, the Communist parties of Italy and France were among the largest in those two coun­tries, the Labour Party of Great Britain was nation­alizing industries as quickly as possible, Mao Zedong's Communists had the Nationalist Chi­nese on the run and would soon seize control of the most populous country in the world, and President Harry Truman was busily implementing the Fair Deal in America.

The distinguished liberal and Harvard professor, Arthur Schlesinger, Jr., was emboldened to write: "There seems no inherent obstacle to the gradual advance of socialism in the United States through a series of New Deals." At about the same time, George Orwell published his novel 1984, which warned that before long Big Brother would be watching all of us.

But the warnings were heeded, and a powerful counterrevolution was launched by conservatives, who were aided and abetted by the abject failure of the socialists to deliver on their myriad promises. As Ronald Reagan later said, the statists "had had their turn at bat…and had struck out."

The fundamental flaw of statism-its "fatal con­ceit," Hayek called it-was its arrogant conviction that policymakers could blithely disregard traditions that embodied the wisdom of generations and the no less arrogant presumption that they could emerge from the inevitable disasters they spawned with their prestige intact and their ideas unchallenged.

Yes, the statists struck out everywhere and the Communists were dumped on the ash heap of histo­ry, largely through a brilliant multifaceted strategy drawn up and carried out by a President, a Pope, and a Prime Minister. Even before the miraculous year of 1989, when the Berlin Wall came tumbling down, freedom was scoring impressive victories around the world. Let me mention a few of the gains:

• In December 1978, the Chinese Communist Party began a series of free-market agricultural reforms leading to the most remarkable explo­sion of farm output in the history of the world.
• In May 1979, conservative Margaret Thatcher won the British General Election and became Prime Minister, promising to dismantle social­ism and extend freedom of choice. "The only thing I'm going to do," she pledged, "is make you freer to do things for yourselves."
• In August 1980, 10 million Poles, a third of Poland's population, expressed their public support for Solidarity, and the Polish Commu­nist Party granted Polish workers the short-lived right to strike.
• In November 1980, the American political establishment was stunned by the landslide presidential victory of conservative Ronald Reagan. In his inaugural address, President Reagan rendered the establishment speechless when he said, "In our present crisis, govern­ment is not the solution; government is the problem."
• In September 1984, conservative Pope John Paul II condemned the Marxist aspects of liber­ation theology.

No wonder that historian Paul Johnson called the final chapter of his magisterial book Modern Times "Palimpsests of Freedom." These were heady days indeed when men and women on every conti­nent and in nearly every nation-save a few scat­tered Marxist-Leninist outposts like Havana and Pyongyang-benefited from a glorious counterrev­olution of liberty led by conservatives like Reagan and Thatcher.

But where do we stand today? If, in 1889, Will­iam Gladstone's Chancellor of the Exchequer Sir William Harcourt could say, "We are all socialists now," and if, in 1971, President Richard Nixon could say, "We are all Keynesians now," can we say in 2007, "We are all conservatives now"?

Clearly not. As economist James Buchanan wisely observed, "Socialism is dead, but Leviathan lives on."

Why? Is it possible that conservative ideas are wrong or outdated? To me, that would be like say­ing that the laws of supply and demand or the Ten Commandments are outdated.

Could it be that ideas do not matter-that only interests count in the modern world? John Maynard Keynes had an arresting answer for that in the very last paragraph of his 1936 opus The General Theory of Employment, Interest and Money:

The ideas of economists and political philos­ophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed the world is ruled by little else.

But the consequences of a good or a bad idea may be a long time in coming. As Alfred Marshall wrote in 1890 in his Principles of Economics:

The full importance of an epoch-making idea is often not perceived in the generation in which it is made; it starts the thoughts of the world on a new track, but the change of direction is not obvious until the turning point has been left some way behind.

The American political historian Theodore White made much the same point in 1964 about the apparently disastrous presidential candidacy of Barry Goldwater, writing: "Again and again in American history it has happened that the losers of the presidency contributed almost as much to the permanent tone and dialogue as did the winners."

So why does Leviathan still loom so large in our lives?

Part of the reason for big government's continued growth, I believe, is to be found in Lord Acton's famous dictum that "power tends to corrupt and absolute power corrupts absolutely." With an annu­al federal budget of almost $3 trillion (that is three thousand billion), members of the U.S. Congress, whether they are Democrats or Republicans, cannot resist the temptation to serve multiple pieces of pork to their constituents.

A deeper problem-and challenge-is that going from a Western welfare state to a truly free, deregulated society is a transformation every bit as difficult as the transition from communism to capitalism.

The gulf between winning the battle of ideas- which I believe we have won-and translating those ideas into laws that genuinely diminish govern­ment's power and influence while expanding the choices available to the individual is a very wide one-much wider than we conservatives realized. In his splendid history of the Mont Pelerin Society, Oxford's Professor Max Hartwell points out:

In the history of ideas there are identifiable periods in which an idea about how society should be organized is clearly articulated and circulated and acquires legitimacy and acceptance. The idea is then embodied in laws that control and condition the actions of populations….

"Rhetoric is not enough," Hartwell emphasizes. "Only when ideas are accepted and also become laws (emphasis added) does the world change." Thus, it is possible to win the war of ideas but fail to change the way the world works.

Let me be clear: I believe absolutely in the power of ideas, in their potential hegemony. Ideas do have consequences. But ideas are not self-implementing or self-sustaining: They must be linked to action.

Translating even popular ideas into policies and laws capable of reversing 50 years of statist domina­tion such as we have had in the United States and Great Britain is certainly a daunting but not an impossible task. How, then, do we translate our ideas-the right ideas-into laws that not only block the road to serfdom, but clear the path to free­dom? Living in a society in which everyone "natu­rally" looks to government to solve almost every problem, how do we return power to the individu­al? Having been conditioned by the welfare state to look to government for their personal security, how do we encourage a sense of greater personal respon­sibility in our fellow citizens?

Allow me to make a few suggestions.

We must breathe new life into what Edmund Burke called the "little platoons" of civil society- our families, our neighborhoods, our churches, our voluntary associations. After all, as the political phi­losopher Michael Novak pointed out, the family is the original and most effective Department of Health, Education, and Welfare.

We must reinvigorate what the American founders termed "republican virtue"-traits such as honesty, respect for law, fairness, and self-reliance. "As human lungs need air," says Novak, "so does liberty need virtue."

We must reiterate the essential point that, as Hayek put it, "liberty and responsibility are insepa­rable." As my former colleague Charles Murray says, "responsibility is not the 'price' of freedom but its reward."

We must reach beyond the economic realm to the historians and political philosophers, to busi­nessmen, artists, and religious leaders, to build the "critical intellectual mass" necessary for a "philoso­phy of freedom" relevant to our times.

We must work not just to roll back the welfare state, but to transcend the welfare state.

I believe with all my mind, heart, and soul that it can be done, but it will not happen through one mighty burst of legislation or a single dramatic event like the fall of the Berlin Wall. Instead, the state will fade away slowly and gradually in one area of civil society after another.

I am frank to admit that I do not know how long it will take. Like Rome, the welfare state was not built in a day and it will not disappear in a day. But I can tell you who I believe will lead the cru­sade for freedom:

• Intellectuals with the courage to speak the truth to power.
• Ordinary people who take responsibility for themselves and their families.
• Religious and community leaders who uphold and pass on their faith and example.
• Political leaders who love freedom and know that the common man can manage his own life better than any government can.

Every individual has his or her own special role in this crusade. We must reawaken a sense of the power, ingenuity, and creativity of civil society. We must encourage our fellow citizens to turn their eyes and shift their hopes from the government sector to what Richard Cornuelle calls the Inde­pendent Sector.

I believe that, as a conservative, I must demon­strate that there are more compassionate ways of helping the poor, more enlightened ways of protect­ing the environment, more effective ways of educat­ing our children, healing our sick, and tending our elderly than the cut-and-paste solutions offered by a distant governmental bureaucracy.

In Pope John Paul II's words:

[W]e have within us the capacities for wis­dom and virtue. With these gifts, and with the help of God's grace, we can build in [this] century and [this] millennium a civilization worthy of the human person, a true culture of freedom.

We have won the battle of ideas so completely that the socialists seldom bother to engage us any­more in honest and open debate. As John Mickleth­wait, now the editor of The Economist, and his colleague Adrian Wooldridge remark in The Right Nation, their perceptive book about conservative power in America, "it is remarkable how the best lib­eral thinkers have been reduced to reacting to con­servative arguments." They rely on sound bites and hot-button clichés such as "soak the rich" and "help the poor" to drive their utopian policy proposals.

Such demagoguery will not carry the day if you and I and every other defender of liberty set about renewing the free society in theory and in practice. What I believe and am proposing, borrowing again from Churchill's "Iron Curtain" speech, is that a "fra­ternal association of the English-speaking peoples" leads the way in halting and then reversing social­ism through the concrete applications of our ideas.

I am convinced that if we do so, we will create an irresistible momentum, that civil society will regain the confidence to challenge the status quo, that the New Class will follow the old nomenklatura into oblivion, and that spheres of freedom will be creat­ed and expanded in every corner of the globe.

Edwin J. Feulner, Ph.D., is President of The Heritage Foundation. These remarks were delivered at a meeting of the Political Committee of the Reform Club in London, England, on February 20, 2007.