Markets, like the nation, must be free
By Michael Ryan
There’s a lot of buying and selling that goes on in the free market. Yet the one thing the free market can’t seem to sell these days is itself.
As demonstrated dramatically in the odd and chaotic “Occupy” movement of a few years ago, a lot of folks just aren’t buying the benefits of capitalism these days.
Young people in particular are a tough sell – even as they hold a Starbucks latte in one hand while they tweet their anti-capitalist rage on their smartphone. No irony there.
The free market – which is inseparable from freedom itself – simply needs to sell itself better. We need to tell its story and celebrate it. We need our young to buy into it.
Enlightened self-interest drives a free market and brings products to consumers.
Strangely, and ominously, we don’t seem to tell the story very well. Consider: Junior Achievement, which introduces youths to the principles of the free market, has to rely on donations – and the permission of bureaucrats – to get into the schools.
Astonishingly, a Harvard University poll last year found that a majority of Americans ages 18 to 29 don’t even support capitalism: 51 percent oppose it, while 42 percent support it.
Amazing. Frightening. This is the heart of American life. It’s the very key to economic freedom and vitality. And yet, it’s a tough sell among our young?
We’d better wake up and address this.
It isn’t just the very young that need to hear it, either. Of the Harvard poll, ‘The Washington Post’ wrote, “Only among respondents at least 50 years old was the majority in support of capitalism.”
One of our problems may be that post-Cold-War youths have been brought up outside the looming shadow of communism. In addition, the media do a much better job of highlighting capitalism’s occasional outrages, such as Enron, than all that the free market does for humanity.
This is a crisis of confidence. And it’s insane. Again, the free market is part and parcel of freedom.
“Capitalism is what people do if you leave them alone,” is how an economics professor at the London School of Economics once put it.
Writes Robert Hessen, senior research fellow at Stanford University’s Hoover Institution, “Capitalism, a term of disparagement coined by socialists in the mid-19th century, is a misnomer for ‘economic individualism,’ which Adam Smith earlier called ‘the obvious and simple system of natural liberty’.”
Citing such an outwardly simple thing as how a can of tuna gets to your store shelf, columnist and economist Walter Williams calls capitalism an “economic miracle.”
From sea to shelf, he writes, “It is not a stretch of the imagination to suggest that millions of inputs and people cooperate with one another to get canned tuna to your supermarket.” And, he notes, “The average well-stocked supermarket carries over 60,000 different items.”
So why do the producers, processors, truck drivers, stores and all the others involved in feeding you do it? “Most of them don’t give a hoot about you and me,” Williams writes. “Some of them might hate Americans, but they serve us well and they do so voluntarily. The bottom line motivation for the cooperation is people are in it for themselves.”
In other words, enlightened self-interest drives the free market – and drives essential products to your door.
“It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner,” the legendary economist Smith wrote, “but from their regard to their own interest.”
A website listing the supposed pros and cons of capitalism included, as one of the free market’s shortcomings, that it ignores social benefits. Far from it! Capitalism actually produces a mind-boggling number of social benefits.
“By pursuing his own interest,” Smith wrote, a business person “frequently promotes that of the society more effectually than when he really intends to promote it.”
No other economic system has risen so many up out of poverty. Even capitalism’s own opponents in the Harvard poll were hard-pressed to come up with a better alternative.
Indeed, besides all the other benefits of capitalism – including economic freedom, life-sustaining products and services, growing the economic pie (rather than just cutting it up), and putting a premium on efficiency – it’s arguable that one of the main byproducts of capitalism is happiness: Polls show the happiest people on Earth live primarily in capitalistic, democratic countries.
Most of the best-fed folks, too.
It’s crazy, and dangerous, that such large portions of our youths would lose sight of all this.
It’s essential for our future that we make it clearer to them.
Michael Ryan is the editorial page editor of ‘The Augusta Chronicle’ in Georgia.
Adam Smith’s classic work, ‘A Wealth of Nations’, explained the benefits of the Invisible Hand in guiding a free market system.
AMERICANS BETWEEN 18-29 WHO SUPPORT CAPITALISM
Source: Harvard University poll
The main challenge to our free market is that our young don’t seem to comprehend its value and principles: over half of millennials in one survey even oppose capitalism.
Our schools appear not to be teaching it, and nonprofit Junior Achievement – which does – has to pass the hat in order to get its free-market curriculum into schools.
The media accentuate capitalism’s warts, such as Enron, but don’t tell the free market’s success as they should.
With the nation’s first pure businessman as president, there’s an opportunity to bring about a revival of appreciation for all the free market has done, and can do, for the world.
A study of East Germany vs. West Germany, and North Korea and South Korea, would illustrate the difference between statism and capitalism.
We also need to understand the nature of failure. Wendy Milling, writing in ‘Forbes’, noted that “Statists believe that the failure of individuals within a capitalist system amounts to a moral claim (against) those who have not failed. They believe these failures are an indictment of capitalism itself.”