Social contract liberalism grows out of the Anglo-Enlightenment tradition, and is associated with Hobbes, Locke, and more recently Robert Nozick. It attempts to deduce justified political authority from a set of universal, abstract premises: All men are by nature free and equal and possess inalienable rights, and the consent of the governed therefore is required for political authority to be just.
Classical liberalism grows out of the Scottish Enlightenment tradition, and includes thinkers such as Montesquieu, Adam Smith, David Hume, Francis Hutcheson, and, more recently, F. A. Hayek. Classical liberalism is more sensitive than contract liberalism to the fact that human beings are by nature social, historical, and dependent animals, and it illuminates the ways in which emergent, spontaneous orders are forms of knowledge that cannot be achieved by centralized direction. Classical liberals therefore show how liberty, community, and tradition can be complementary, and how political authority can be justified as a necessary means of solving coordination problems in a given society.
... Although the roots of modern liberalism can be found in the writings of Kant, Hegel, and J. S. Mill, its most influential American expositor is John Rawls. Rawls ingeniously (and, it must be said, not always coherently) combines both contractarian and classical liberalism into a comprehensive philosophical system that is indebted to both forms of liberalism, even as it departs markedly from them.
There is no need to reiterate the problems with modern liberalism. The point here is to set in relief what is distinctive about natural law liberalism. According to Thomas Jefferson, the Declaration of Independence is not simply a translation of Lockean social contract theory. “All of its authority,” he wrote in a letter to Henry Lee, “rests on the harmonizing sentiments of the day, whether expressed in conversation, in letters, printed essays, or in the elementary books of public right, as Aristotle, Cicero, Locke, Sidney, &c." Locke is there, but so is Aristotle.
We have here a clue to what is great about American liberalism: It does not rest upon the writings of a single theorist, but draws from the best thought of the western tradition of right, classical, medieval, and modern, in a way that is still genuinely liberal. Elements of both social contract theory and classical liberalism are there, but their foundations rest upon the metaphysical realism and ethical framework of the pre-modern tradition (Aristotle and Cicero).