MUST READ: Free Enterprise & Fiscal Sanity Aren’t Social Darwinism

Read the entire article on the NRO Corner: Free Enterprise & Fiscal Sanity Aren’t Social Darwinism

Though most of us already know this, the argument is well presented and useful in discussions with those new to economics. –Robin

However, leading advocates of economic freedom from Adam Smith, F. A. Hayek, and Ludwig von Mises, to Julian Simon and George Gilder, do not commend Social Darwinism, but liberty, human rights, limited government, private property, the coordinating effects of prices, the win-win nature of free exchange, and the creative capacities of entrepreneurs.

The law of the jungle is that there is no law: The strong kill the weak. Economic freedom, in contrast, exists only where rule of law prevails — where people can’t kill, steal, and defraud each other, where private property rights are protected and trust is widespread. These laws channel our economic behavior. In a free market, if I buy a hundred dollars worth of groceries from the store of my choice, that means I prefer the groceries to the money, and the grocer prefers the money to the groceries. That’s a win-win game, not the Hunger Games.

Cooperation and coordination are just as much a part of the story as is competition. In a free market, prices fluctuate based on supply and demand. This causes goods and services to be distributed where they are most needed and wanted. The demand for sushi in Seattle raises the price restaurants can charge for it, and this “draws” sushi grade salmon and tuna to the Emerald City. For the same reason, sushi doesn’t go to waste in small Texas towns where no one likes it.

Because of this market coordination, Americans take it for granted that, ordinarily, when they enter stores, products will be on the shelves. Not so in countries with government monopolies. In the former Soviet Union, extreme shortages and wasteful surpluses were a near-universal experience.

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Posted on April 6, 2012, in Economic Philosophy, Free Markets and tagged , , , . Bookmark the permalink. Leave a comment.

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