Only Markets Can Win the War on Poverty

“What about the poor?”
An interviewer just asked me the question following my usual call for markets in everything. It’s probably the 100th time this has happened. The question amazes me because the implication behind it implies that markets serve primarily the rich.
It’s hard to imagine a more profound confusion. The default state of the world is grueling poverty, universal insecurity, and short lives. When governments do come along, they nearly always serve themselves first.
Capitalism made huge progress toward the conquest of poverty.
The most earth-shattering change in this persistent trend of all recorded history came with the advent of capitalism. For the first time in history, the productive resources of society turned from serving mainly the elites toward serving the common person. This change alone began to flip the power narrative of social evolution.
And this revolution continued for two some two-hundred years, during which time the average life span expanded dramatically, infant mortality collapsed, incomes rose, and the great project of universal ennoblement achieved an unprecedented boost. And this trend continues today wherever markets are given freedom to function, property rights are secure, and people can associate and trade without molestation by the elites.
In short, capitalism made huge progress toward the conquest of poverty. This is the title of a great book by Henry Hazlitt, and the newest free epub release by the Foundation for Economic Education. It tells the story of wealth creation in modern times. It should be downloaded and read by anyone who cares about a society of flourishing lives.
The more government tries to “help,” the more the poor are denied choice, mired in dependency, and exploited by bureaucrats and politicians.
The common presumption that markets serve the rich and governments serve the poor is belied by all evidence.
Think only of the early years of “progressive” reform of government during which time the administrative state came into its full glory, between 1900 and 1920 in the United States. The power of the state was used to exclude, segregate, sterilize, and even quietly exterminate the weakest among the population while bolstering the power of in-groups and the establishment.
Eugenics, a prevailing ideology in these years, required government to realize its aims. So many policies in those years answered the question “what about the poor?” in the following way: we will wipe them out.
In the second half of the century, the excuse for massive welfare, regulatory, and tax policies changed. We were now told that all of this would be good for the poor. This has not been the case. The more government tries to “help,” the more the poor are denied choice, mired in dependency, exploited by bureaucrats and politicians. You only need visit a courtroom in any major city in the US to discover that government is the leading threat and most dangerous menace to the just aspirations of the poor.
So, yes, we need a war on poverty. Only markets can wage it successfully.
Beautiful Anarchy
The Economics of Life Itself : Beautiful Anarchy is the writing platform of Jeffrey Tucker, in which he covers economics, art, popular culture, and politics from a pro-liberty, anti-state point of view.
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Wayne E Essel March 22, 2017 , 3:18 pm Vote0
What will it take for our society to begin actually protecting markets *from* government and special interest (via government). Seems to me that our legal system is inaccessible to the poor, and that the poor have no recourse other than hidden, grey or black markets. The legal system also cannot be used by the poor (or any one else for that matter) to clobber an aggressive special interest whose aim is market manipulation.
Rick Rule March 22, 2017 , 4:35 pm Vote2
Another truly sad note is that many market participants are fooled into believing that government regulation protects consumers from fraud in the marketplace, and negates or reduces the need for individual vigilance In my experience, at least in securities and investment markets, but likely in other ” consumer protection” theaters as well, this protection is a dangerous illusion at best.
Remember that Bernie Madoff ( an $18,000,000,000 scamster) was president of a government approved regulator.
The Enron scandal was a case of accounting fraud, a regulatory failing ( fraud was illegal before the offences, but the regulators called it a market failure. The result…the Enron fraud cost investors $80,000,000,000, in total and the resultant legislation ( Sarbanes Oxley) costs shareholders $100,000,000,000 ANNUALLY, to prevent crimes that were already illegal.