Economic Liberty

In speaking about the current financial crisis, President-elect Obama said that the situation can only be cured by the government. This is exactly the fundamental difference between liberals and conservatives. The left believes that whatever ails us can be solved by government intervention. Those of us on the right believe that individuals, through a free market, are best able to solve our problems.

Conservatives have come to this conclusion for several reasons. First and foremost is the belief that government regulation is incompatible with the notion of individual liberty. Individual liberty is, of course, the basic value of Western civilization. Second, evidence often shows that the unintended consequences of government intervention leads to problems that are worse than what such intervention was intended to cure. Think about the War on Poverty and the increased in children born out of wedlock.

Since I am not a part time capitalists (meaning that I like capitalism when things are going well, but I like government handouts when times get tough), I am appalled by the spending packages that have been run up by the Bush Administration and those that are being proposed by the Obama Administration. The burden that this place on future generations is incalculable and it will inevitably lead to those unintended consequences that may be worse than the current situation.

Additionally, the leadership of the 111th Congress and the Obama Transition is using the proposed “stimulus packages” as an instrument for social engineering. How does providing health care for the recently unemployed increase GDP? Also the infrastructure spending that Mr. Obama has been advocating will take years to spend. Only a very small fraction of it will be spent in the next 12 months. If the point of the stimulus package is to immediately inject cash into the economy, how will spending money on roads and bridges 3 to 5 years in the future help the economy today?

What the Democrats are doing is obvious. Rahm Emanuel stated it right after the election. He said that politicians can’t afford to waste a good crisis. He said that a crisis gives them an opportunity to pass legislation that would never be acceptable during good times. They see this chance to make major changes to our society that would otherwise never be allowed. In these times, it matters not what the financial cost is or will be and whatever else they choose to socially engineer.

The premise of creative destruction under a free market system (meaning that those who do not provided a good or service that can sustain itself in a free market are gone, but those that do flourish), keeps us from subsidizing things that no one wants. Should the government be paying buggy whip manufactures? When left to their own devises, a free people will fill the voids in the market and sometimes at the expense of others. It may lead to short term pain, but an economy operating at maximum efficiency benefits society as a whole. There is nothing efficient about government intervention.

Remember that liberty is the solution to human condition and wealth is the cure for poverty. In a free market system, there is no such thing as a zero sum gain. Wealth will continue to be created and inure to the benefit of most. Short term dislocations should not be a source of panic. Conservatives know that the people can be trusted. Hopefully, the Obama administration will learn that lesson too. If not, beware of the unintended consequences.


Anonymous said...

Consider that with the great majority of people in near panic these days, who among us is going to "cast the first stone" or should I say dollar? While the government doesn't always get it correct, the government DOES have the money, and is not panicked to the point of not willing to cast the first dollar. I'm sorry to say that at this juncture, we need the government to get things started. I just don't see the "public" ready and for that fact willing or able to get the economy started.

Steven L. Baerson said...

Unfortunately, your premise is incorrect. The government does not have any money. It's our money!