By Dwight R. Lee (from IR 44:0, Spring 2009)
Lee talks about the distortion of capitalism by the intrusive political involvement of the government in 'free trade'. The more government control in free enterprise, the greater the failure of its success. Keep in mind that Ayn Rand is the underlying figure of Lee's position.
Lee's Stance on Health Care:
People are spending more on medical care because the success of markets and freedom has increased their wealth and made medical care worth more than ever. Government policies are causing medical spending and costs to be greater than necessary by distorting markets and restricting freedom
As government policies have reduced the ability of markets to provide better medical care at lower real costs, the political response has been to dismiss markets as having failed and then claim more government control is required to ensure "better care at lowering costs."
Lee's Stance on Manufacturing:
Employment in the manufacturing industry has provided the opportunity for men and women, but mostly men, with limited education to enter into and expand the middle class. Manufacturing is a story of how the information and incentives to direct resources and workers into their most productive employments are successfully communicated through market prices. Hence, the so-called decline in manufacturing that we hear is not an economic decline at all.
The public is being convince that another success of markets and freedom is really another failure requiring government to distort market incentives and reduce freedom with an ad hoc set of politically inspired interventions, including subsidies, trade restrictions, tax breaks, and tax penalties.
Specialization, Coordination, and Wealth
The greater the reliance on the rules of private property and voluntary exchange, the more specialized and productive people become. Specialization necessarily means that people are dependent upon one another, and the greater the gains from specialization, the more dependent we are on larger number of more widely dispersed people. Government policy is invariably responsible for most of the dislocations that lead to economic slowdowns.
Low Costs? The Wal-Mart Example
The criticism of Wal-Mart focuses on the claims that it (1) exploits its employees by paying them low wages with meager fringe benefits, and (2) harms communities by bankrupting local businesses and destroying the jobs they provided. Of course, all successful companies put some competitors out of business and destroy the jobs they provided.
Prosperity and Discontent
People have a hard time coping with success. This nowhere more evident than with the success of markets and freedom. People becoming exercised over relatively minor problems upon which the world's prosperity depends or about which prosperity gives people the luxury to worry.
Any general attempt by government to protect wealth against market discipline quickly threatens the wealth of all. The best way to solve the problems created by the existing level of prosperity is to allow the freedom necessary for markets to replace them with other problems, the problems of even-greater prosperity.
As government policies have reduced the ability of markets to provide better medical care at lower real costs, the political response has been to dismiss markets as having failed and then claim more government control is required to ensure "better care at lowering costs."
ReplyDeleteJust for the record: This is does not necessarily portray my personal views; this particular post is for Philosophy 1 students to study.
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