Economy

Free Markets, Free People

Our culture increasingly and falsely characterizes capitalism as a form of oppression and exploitation.

Caroline C. Lewis · May 17, 2018

Our culture increasingly characterizes capitalism as a form of oppression and exploitation. Some movies characterize business owners as crony capitalists who force long hours on their workers in dingy sweatshops with no breaks, inadequate pay and no mercy. Democrat politicians in particular rail against corporations and “fat cats,” creating horrific caricatures and sweeping generalizations out of a few bad examples.

But how true is this picture?

It turns out that the exact opposite is true. Free markets allow people to flourish, while controlled markets (such as socialism and communism) coerce people into being a machine of the government.

Taking a step back in time, consider two young boys, one who lives in America and one who lives in the Soviet Union. Ask the American boy, “What would you like to be when you grow up?” and he answers “A fireman!” Ask the Russian boy the same question and he answers, “They haven’t told me yet.”

The freedom to choose your future is one of the hallmarks of the free market. Human dignity remains the foundation of this freedom: All people have inherent value and worth and therefore should have the freedom to choose their life’s course, or as the Founders put it, “to pursue happiness.”

“But I thought that capitalism was unfair,” some object. But is it?

People do not have the same gifts and talents. This is an obvious fact in families. Take two brothers. They have the same parents, are raised the same way, and go to the same schools. Yet one is naturally better at numbers and the other is naturally better with people skills. In a market economy, we give both brothers the opportunity to succeed by allowing them equal opportunity to explore their gifts and to apply for jobs within their strengths set. So one becomes an accountant and the other a sales director. Are they the same? No. Are they “equal?” No. But they can each succeed in their own way, according to their skill sets. Or take two sisters. Same parents, same schools, same starting point. But one is good at science and the other shines in drama. So one sister becomes a doctor while the other becomes a drama teacher. But that’s not fair! The sister who is a doctor makes more money! Yes, but she also spent more years in school and took out more student loans. While it appears to be about the money, at its core, the claim of “unfair” sometimes focuses on the raw talent and at other times, the work ethic. If one sister is working 100 hours a week and another is working 40 hours a week with summers and holidays off, why is that inherently unfair? What is fair is that each sister was able to choose what she wanted to do. The claim of unfair does not account for individual decisions made by the person.

Milton Freidman, the famous economist, stated: “A society that puts equality — in the sense of equality of outcome — ahead of freedom will end up with neither equality nor freedom.”

If our starting point is equality, it ultimately forces everyone to be the same. Same job, same income, same food — so that no one can become jealous or envious.

Envy, in fact, is the problem that socialism tries to fix. If we all have the same things, then we wouldn’t be jealous. Really? Have you tried that with a random sampling of children — preferably siblings?

Consider a conversation like this:

“But my book has a dent in it and hers doesn’t”
“But they are the exact same book.”
“But hers smells newer than mine.”
“But they are the exact same book.”
“I don’t think either of us should have books ever, because it’s not fair that they are different.”

Aha! Now we’ve hit on the real issue: being different. And the fact that we are all different leads to envy because we all want something we don’t have. It’s human nature.

Socialism attempts to fix human nature from the outside in. It asserts that changing the institutions will change human nature. (Well, keep trying on that one). That’s why socialism fails everywhere it’s been tried.

In contrast, free markets encourage a free society. They protect the people from coercive government mandates that strip freedom and exchange scraps (in the name of protection) for slavery.

And the dingy sweatshop with the crony capitalist from the beginning of the article? That’s a snapshot of communism. In a free market, those people would be free to quit and get a better job, not to mention sue their employer on their way out.

Free markets empower people to pursue their talents and give them the freedom to work hard, the freedom to have an opportunity, and even the freedom to fail. The market and market-driven policies lift people out of dependency and hopelessness into personal achievement, giving them the satisfaction of what Arthur Brooks, president of the American Enterprise Institute, calls “earned success.”

Our American economy, however, is a mixed-economy — a mixture of free market and government interference in the form of regulations and high taxes. These keep the American market-system from being all that it could be and hinders the empowerment of the people. Fortunately, the current administration understands the value of tax cuts and massive regulation reduction for the American people. We must continue to cherish and preserve the market system in America, while also working to cut economic encumbrances that hinder our economy from being the agent of empowerment for our country and the world.

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