Mises Wire

Free Markets are the Road Map to Economic Improvement for All

Riched Ebeling this week employs a helpful analogy. He notes how free-market economists are often in the position of pointing out that various government regulations and subsidies — which government claims will make everyone better off — are actually a hindrance to economic prosperity for all. (The minimum wage for example, causes unemployment among the least qualified workers, and thus punishes the youngest and least skilled workers — often the poorest workers — most of all.) And yet, when such things are pointed out, these free-market economists are accused of being against the poor. Ebeling explains: 

Suppose someone were to ask you the easiest and quickest way to drive by car from New York City to San Francisco, California. Since the shortest distance between two points is a straight line, the most reasonable answer would be for this person to take Interstate Highway 80, which runs East-West between these two cities.

Now suppose that this person, instead, starts driving south from New York City on Interstate Highway 95, which would get him, eventually, to Miami, Florida. You tell him that he is on the wrong route; not only will it take him much longer to get to California if he stays on Interstate 95, but he may end up never getting to San Francisco at all.

Rather than thanking you for correcting him and figuring out the best and most timesaving way to get back onto Interstate 80, he accuses you of not wanting him to get to California. He wants to know what you have against him and the people of California. Why are you sabotaging his chance to finally find “happiness” in California?

You assure him that you have nothing against either him or California. Indeed, you explain, you’ve even been to California and it’s a very nice place to visit and maybe even to live. You are just pointing out that he is following the wrong route to get to his desired destination, and in that easiest and quickest way as he had originally asked.

He responds by asserting that you clearly have something against him and have some hidden agenda to prevent people from getting to California.

Accusations Thrown at the Free Market Advocate

A person saying such things would, to most of us, seem strange or even bizarre. It is, however, the way many critics of the free market respond when an economist or some other proponent of economic liberty explains that government intervention in the market, regulation of business enterprises or redistribution of income and wealth are not the best and most efficient policies to provide an economic and social climate most conducive to opportunity, prosperity, and freedom for as many people in society as is possible.

Free market critics frequently assert that the free market advocate “hates the poor,” “doesn’t care for humanity,” is “insensitive to human suffering,” and only wants to help “the rich.” And how can we know this? Because he dissents from the governmental interventionist, regulatory, and redistributive policies proposed to cure the ills of society.

In other words, they impugn the motives and benevolence of the advocate of individual liberty and free markets because of his disagreement with the proposed means to achieve the stated end – improvement in the personal and material conditions of mankind.

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