CAPITALISM: VILLAIN
OR HERO
Polls have consistently shown that
a majority of Americans support the free enterprise system and that they desire
less government than we currently have. Yet, voters repeatedly approve, or at
minimum look the other way, as government expands year by year. How is this so?
As explained by economist Arthur C. Brooks in his recent book The Road to Freedom, “This is a paradox,
but not a mystery.” Although citizens express support for free enterprise and
limited government, “they sure wouldn’t mind a new government-funded rec center
and maybe a few free prescription drugs, and politicians gladly oblige to win
votes.”
Free enterprise and big government
are mutually exclusive. The escalation of government, “comes from making one
little compromise to the free enterprise system after another.” And reversing
this trend has so far proven to be a political impossibility. Even proposals to
reduce the rate of increase in
government spending are met with outcries of economic calamity and social
tragedy.
Government spending at all levels
has expanded from about 30 percent of the nation’s economy in 1980 to about 40
percent today, and by 2036 the proportion is projected to reach 50 percent. The
so called “deep, brutal” cuts associated with the “sequester” will minimally slow
the rate of increase in spending but will
do nothing to stop the expansion of government. Even if the “cuts” are allowed
to occur, the Congressional Budget Office projects that annual government
spending will increase by more than $1 trillion over the next six years.
Along with Mr. Brooks, numerous esteemed
economists have identified how bloated government spending robs the economy of
jobs and reduces wages. Although the studies vary in their specific
conclusions, on balance they evidence that the growth of government (beyond its
most essential duties) results in a net decrease in jobs.
But as Mr. Brooks argues, the
greater issue with big government is a moral one. Thomas Jefferson cautioned
that, “dependence begets subservience and venality, suffocates the germ of
virtue...” And even Franklin Roosevelt warned that, “continued dependence on
[government support] induces a spiritual and moral disintegration fundamentally
destructive to the national fiber. To dole out relief in this way is to
administer a narcotic, a subtle destroyer of the human spirit.”
Undoubtedly, many today would
agree. But passive concurrence is not enough. Mr. Brooks suggests that we must
first resolutely acknowledge the moral pre-eminence of free enterprise verses
big government. He argues that it is the moral arguments in favor of big government
and opposed to Capitalism, however misguided, that foster popular support for government
expansion. Government is deemed benevolent while free enterprise Capitalists
are characterized as greedy and exploitive. This is simply false. Free
enterprise, rather than government, is the greater friend of small business,
the middle class, and ultimately of workers at all wage levels.
Mr. Brooks further argues
that real happiness is the product of “earned success,” however modest, and
that government redistribution policies breed what he terms “learned
helplessness” which is detrimental to individual wellbeing—economic and
otherwise. “Welfare programs created a permanent underclass ... harming those
it was supposed to help.” Only free enterprise provides the optimum framework
for what people desire: freedom of individual expression and the pursuit of
happiness.
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