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Economic Liberty

While the Democrats claim to protect the personal liberties of Americans they are less protective of our economic liberties.  By economic liberties I mean the right to own and manage wealth producing assets with minimal interference from the government. This interference may come in the form of onerous regulations,  or inconsistent and confiscatory taxes. This applies to individual earning capacity, the hurdles of running a small business, or the friction costs associated with larger firms.

The resistance to capitalist freedom originates in its its moral perceptions.  Some see capitalism as a productive use of greed.  The “greed is good” speech of Gordon Gekko in Wall Street has fixed that perception in the minds of those that think such fulfillment of moral depravity should be strictly controlled.

But greed is not good and capitalism and economic liberty is about much more important values. Capitalism is the competition of ideas.  Excessive regulation restricts the ideas in the market place. Excess government debt deprives the financial markets of the capital needed to pursue those ideas.  And failure is just a part of the process of weeding out bad ideas, making room for the best ideas to thrive. When government prevents failure they slow down the process of improvement.  When government nationalizes or controls large parts of the economy as they now do with health care, important innovation is curtailed.  In a free market bad ideas are rejected, sometimes after some considerable pain. But when government institutionalizes these problems they just get more funding and remain.

Economic liberty must not be confused with government aid and bailouts.  Crony capitalism is a perversion of capitalism, not its cousin or heir. “Comfortable failure will always turn to politics to protect it from change.” (Sowell)

The personal liberties the Democrats value highly can also be perverted when opportunities become rights, or worse, entitlements. Personal liberties can not be isolated from economic liberties.   When government intrusion into the business world destroys the economy’s ability to create jobs, then individual opportunities are restricted.  Economic liberty is more central to creating jobs than making it a right.  When a job becomes a right then it is not a leap to make the income from that job a right, even if you do not have to work to get it.

 

Category: Economics

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