Fear of Free Markets

Certainly the shanghaiing of health care was center stage in Washington. Yet there is something more we can extract, something even profound, something freighted with more gravity than this mere perfidy - that would be the chilling instinct of so many to fly to government for security, for protection from the workings of free enterprise. Why?

Gary Becker and Milton Friedman founded the Chicago School of Economics. Both are Nobel laureates. We lost the great Friedman but Becker at 79 is still very active. The WSJ carried an interview with Becker at Stanford’s Hoover Institution.

When asked about the health deal, "It's a bad bill," Becker replied. "Health care in the United States is pretty good, but it does have a number of weaknesses. This bill doesn't address them. It adds taxation and regulation. It's going to increase health costs—not contain them." Thank you.

But on pondering our key consideration - why for example capitalism has produced the highest standard of living in history and yet its beneficiaries sometimes forget that and look to government for protection, from higher health care premiums for example - Mr. Becker explains: "People tend to impute good motives to government. And if you assume that government officials are well meaning, then you also tend to assume that government officials always act on behalf of the greater good. People understand that entrepreneurs and investors by contrast just try to make money, not act on behalf of the greater good. And they have trouble seeing how this pursuit of profits can lift the general standard of living. The idea is too counterintuitive. So we're always up against a kind of in-built suspicion of markets. There's always a temptation to believe that markets succeed by looting the unfortunate."

Many of the left tend to feed exclusively on the bottom; like catfish or carp they feel secure down there. And they want the rest down there with them. But the notion that free enterprise is bad, that it spawns inequality of opportunity, is a myth. The easy way out, that chorus that the rich exploit the poor, or, to update, that insurance companies exploit consumers is utterly false IF government’s role is limited to preserving the rule of law. High health insurance premiums are no secret for goodness sake. But when a free market is permitted to operate then it is in everyone’s best interest, and, in all arenas including health.

And so we see that absent the left’s hijacking of the health sector, the fix would have been easy. As Becker explains, "Health savings accounts could have been expanded. Consumers could have been permitted to purchase insurance across state lines, which would have increased competition among insurers. The tax deductibility of health-care spending could have been extended from employers to individuals, giving the same tax treatment to all consumers. And incentives could have been put in place to prompt consumers to pay a larger portion of their health-care costs out of their own pockets."

Instead, BO artfully exploited the groundless fears of capitalism and the instinct of many to look to government for a fix. He understands the indolent nature of a good portion of our population, those whose library is stuffed with past issues of People, Newsweek and Cosmo but never an Adam Smith, John Stuart Mill, Buchanan, Stigler, Hayek or Friedman.

Robert Craven