Saturday, October 11, 2014

The Alternative to Big Government

The only environment that has ever produced real economic growth is an environment of free markets.  The most recent historical example is that taking place in China in their easternmost provinces.  True, China is far from a free market economy overall, but in the few spots where free markets have been permitted to do their thing, an economic revolution has occurred.  While there have been a growing number of billionaires sprouting up during the economic boom, the real change is the movement of hundreds of millions of Chinese from dire poverty into the middle class.  Government cannot accomplish a change like this, but free markets can and have.

During the heyday of the old Soviet Union, Americans were constantly regaled by stories of successful five year economic plans in the Soviet Union, while economic growth in the US, then about 3 percent, was seen as pitifully low.  That was then, this is now.  Now, we know that over more than six decades of Soviet rule, there was no economic growth at all in the Soviet Union and agricultural output, in particular, declined for the first five decades of Soviet rule.  So much for the glories of centrally planned economies.  Meanwhile, 3 percent growth seems an elusive goal in modern America, beset by central planner dominance of government.

The difference between government planning and free markets lies in the unleashing of human initiative and effort.  Academic equations cannot capture this.  Academic economics assumes a robotic world that only government policy can impact.  But, the real world is not like that.  Ideas and human beings, left free to do their thing, do their thing and the world is a better place for it.  Idealistic reformers pave the way for the Stalins, the Hugo Chavez's, the Fidel Castro's and, yes, the Ayatollah's. 

When has a radical reform movement, centering upon the concept of improving the lot of poor people, ever led to an outcome that is anything but abhorrent?  There are no historical examples.  All of these movements end up with a Hitler or a Stalin or a Hugo Chavez, no matter how well meaning the activists that began this trail to disaster. (Note that the American revolution was not a radical reform movement centered upon improving the lot of the poor, though the revolution certainly had that effect; ditto for the British and their Glorious Revolution).

If you want to help poor people, give them economic freedom.  Then they can help themselves.  Government policies simply create an ever strangling prison that the poor, eventually, can never escape.

If you really want to help poor people, then give them the right to choose where their children go to school, the right to work whereever they want to work and for whatever wage or other arrangement they choose.  Let people provide the health care they need in whatever way they wish. Allow people to provide for their own retirement, assuming they have any interest in retiring.  In short, break the chains that bind poor people to an economic life with little promise or hope.

It's worth noting that "activist" leaders that promote big government are almost, without exception, individuals that are drawn from the wealthiest economic backgrounds of society.  Folks like George Clooney, Sean Penn, Warren Buffett, George Soros, Mark Warner, Bill Gates, and, yes Gwyneth Paltrow have no ties whatever to the poor. These wealthy elitists are in the Vanguard of strangling the hopes and dreams of the folks at the bottom of the economic pile and thereby promote their own sense of personal nobility.  They can smile knowingly and check themselves out in the mirror, while the poor struggle in the prison that these folks continue to promote.

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