II. The Economy in Theory and Action
The operative idea is freedom. A free market ensures people the most possible economic freedom, which is directly tied to political and personal freedom. Section 3 will deal with this theme more.
Freedom is achieved through voluntary choice in spending. Governments that take money away from people in order to provide a service are stripping away that freedom, while also enhancing their own power by controlling money, services, and resources. Centralized power in general can be seen as an enemy to a free market, and the goal is a dispersed (though not entirely equal) distribution of wealth and control.
The counter to this is that governments provide necessary services to many citizens, and therefore must take away money to be able to facilitate this. But in a free market, any service that is needed will eventually be provided because of demand for it, and it will crop up naturally as a private business. The presence of numerous businesses in any given field will ensure competition. If one group gouges customers, another will benefit that makes their cost more attractive to the consumer.
And the presence of this competition will force the companies to be more efficient. Any government-run institution is by default a monopoly, and therefore without direct competition. There is little, if any, incentive for them to improve their methods or efficiency, because they don’t face pressure from other competing services. Some pressure exists in the form of elected officials potentially losing their reputation (or their political party’s rep) as a result of failed programs. But this is minor and infrequent compared to the intense pressure of a competitive market.
I have hesitated to provide a specific example because so many are available that to use one would be to limit the concept. However, to make it relevant, we shall look at the Social Security system. This is quite simply involuntary old age insurance. We must contribute to it, and have no choice in the matter. And the myriad problems with the system, and its potential failure and collapse (predicted by some but not all politicians) speak the to flaws of such a system. It is coercive, meaning it is forced upon the consumer at the cost of a portion of their economic freedom. And it is inefficient. Yet it is a necessary service for many. Going “cold turkey” on such a system and removing it would doubtless leave many in ruin. But one cannot argue that it is more efficient or freeing than if multiple similar services were offered at competitive rates in a free market. People could choose to invest their money in such a system, or not do it and invest in some other interest.
Some might argue (quite rightly) that people can and will be very stupid. Many wouldn’t provide a solid financial base for themselves and wouldn’t choose to invest in such systems. True enough. But is it the responsibility of the government to hold the hand of every person, at the cost of personal freedom? And should a government decide what they feel is best for everyone, especially when a better alternative may exist? I would argue no to both, so long as the opportunity is still be provided to them (which it is). The choice is still available to them, and the operative idea is again that they have the freedom to do so rather than it being forced upon them. Some have even suggested a system like car insurance, where the government requires it, but it can be purchased independently from competitive providers. If one wishes to remain paternalistic, this accomplishes that while using the advantages of the free market.
Furthermore, for the majority who work toward their well-being, they will naturally work harder for their own economic prosperity than a detached and bloated government institution would. They will also make better decision for their well-being. A “blanket” program for all citizens will not help all equally, and many would be better off investing in various other interests. By leaving this choice to the person themselves, they have an increased chance of success while maintaining their freedom, and will doubtless invest more wisely and efficiently than a government with no personal attachment toward a person’s money, nor any responsibility except to statistical majorities rather than individual prosperity. The person is not forced into forfeiting wealth, and by the voluntary and co-operative nature of a free market, will not sacrifice his/her wealth unless there is benefit to doing so.
So in social security, and any welfare-minded service, some people who do not need aid receive it, others don’t receive enough, special interest groups allow for loopholes in the system which creates inherent inequality, people are being forced to contribute to this system monetarily which is a loss of freedom and an imposition of rights, and the system itself is wasteful. But the social security system has a monopoly on old age insurance, so any experts in the field work for the government and are only familiar with its function. Naturally, they want to “improve” or expand the system. This includes politicians, who, at best, want to reform it, not remove it or replace it with free market competition. Thus, we enter a vicious cycle of government control.
Later we shall look at other programs whose effects are similarly adverse.
III. The Dangers of Fascism
By fascism I mean governmental control in forms that limit citizens, economically, politically, or personally. There isn’t a line at which a capitalist society ends and fascism begins, but most developed countries have shades of both at various levels.
Most are familiar with the ineffectiveness of communism, so it won’t be advantageous to go into it at length. I will say this, however: there is nothing wrong with the intent of fascism or even communism. It is in their execution that we see they cannot work. One may even value personal contentedness over freedom, which is the allure of governmental control. If all are provided for in a sufficient manner, happiness could theoretically be higher than in a totally free market. To some, this would be seen as a better solution. And I might agree with them. It is, however, in practice that this idea fails, for nowhere in modern civilization does a significant loss of freedom, even with the gain of prosperity, account for a jump in happiness. Usually the opposite is true, since most societies will resent too much control over them.
The danger I wish to speak of, however, is a subtler one. It is easy to think that one can give up economic freedom for the perceived greater good, and still remain totally free in a social, political, and personal sense. This is untrue, as the three are closely linked.
Say a state is run with very little economic freedom. The jobs and wages of the populace, as well as economic tariffs, prices, trading, and investments are rigidly controlled by the government. The same state, however, also allows for great personal freedom. But how much freedom is possible in such a state? If a person wants to, say, protest for a cause that is not currently implemented (any cause will do), government regulations on economics will prevent him from raising funds, purchasing materials for broadcasting (TV commercials, radio spots, materials for pamphlets and letters), and mobilizing any sort of following simply because his potential followers (other citizens) are also on the government’s bankroll. If the cause is not somehow sympathetic toward the current government system, it will be impossible to enact. And if is indeed sympathetic, one wonders why there would be need for protests. Economic control, then, is tantamount to political control and to a lesser extent social control. There is not always this strong a correlation, but the effect that one has on the others can be clearly seen from this example.
Certainly, this is a polarized example to illustrate a point. No society would exist exactly like this. But the correlation is still present at lesser degrees of government control, though not as strong, and doesn’t change the danger outside of such hypothetical settings.
So one can even drop the label of “fascism” if it helps to make it more relevant, since even my country, the United States (which is closer to a free market system than nearly anywhere in the world), is far from totally free economically.