What is a "free market," anyway? Reason Magazine's slogan is, "Free Minds and Free Markets," and you hear politicians pay at least lip service to the idea, so we should probably define what it is we are talking about. I have a working definition. A free market is a voluntary mutually beneficial exchange of goods or services between two or more parties. What can be traded might be affected by regulations, laws, or basic human morality, but the basic definition is pretty straightforward.
Notice that my definition, which I certainly must have stolen from somewhere, need not be applied to exclusively economic matters, though it certainly includes that. Also, when you hear people say that government is getting in the way of the free market, what they most likely mean is that the voluntary nature of an otherwise beneficial relationship is being thwarted unnecessarily on one side or the other, perhaps to the extent that a trade never takes place. Something that prevents a party from bringing goods or services to a free market is called a "barrier to entry." Some barriers are good and necessary; some may not be. If barriers to entry are erected arbitrarily or inconsistently, the market isn't free. "Some people making a lot of money" is neither the definition of a free market, nor of capitalism, the name usually given to the economic system defined by free markets. If economics exists as a science to manage the problem of scarcity, then we ought to choose the one that best does this. And because people have a dignity that comes from God, we have to choose an economic model that is not only efficient, but also leads to human flourishing and liberty. Most systems other than capitalism either fail to manage scarcity well, or fail to uphold the dignity of each person, or both. (At the extreme here, some central government will take the life of those who oppose its goals.)
I had a few incredibly general thoughts about this, since I was helping a buddy with something related to business ethics. It led me to think that because it is accepted that governments exist partly to provide for the general welfare, we should think of economic assistance from governments to individuals as aids to participation. It upholds no one's dignity to contribute or exchange nothing of benefit to others, just as abject material poverty is dehumanizing.
Notice that my definition, which I certainly must have stolen from somewhere, need not be applied to exclusively economic matters, though it certainly includes that. Also, when you hear people say that government is getting in the way of the free market, what they most likely mean is that the voluntary nature of an otherwise beneficial relationship is being thwarted unnecessarily on one side or the other, perhaps to the extent that a trade never takes place. Something that prevents a party from bringing goods or services to a free market is called a "barrier to entry." Some barriers are good and necessary; some may not be. If barriers to entry are erected arbitrarily or inconsistently, the market isn't free. "Some people making a lot of money" is neither the definition of a free market, nor of capitalism, the name usually given to the economic system defined by free markets. If economics exists as a science to manage the problem of scarcity, then we ought to choose the one that best does this. And because people have a dignity that comes from God, we have to choose an economic model that is not only efficient, but also leads to human flourishing and liberty. Most systems other than capitalism either fail to manage scarcity well, or fail to uphold the dignity of each person, or both. (At the extreme here, some central government will take the life of those who oppose its goals.)
I had a few incredibly general thoughts about this, since I was helping a buddy with something related to business ethics. It led me to think that because it is accepted that governments exist partly to provide for the general welfare, we should think of economic assistance from governments to individuals as aids to participation. It upholds no one's dignity to contribute or exchange nothing of benefit to others, just as abject material poverty is dehumanizing.
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