What’s in it for me? Explore the economics of freedom.
The Cold War between state-sponsored Soviet socialism and the Western world’s capitalism ended in a decisive victory for the latter camp. As communism crumbled, politicians and intellectuals of all stripes reached a similar verdict: liberal-democratic capitalism was the only game in town. As Margaret Thatcher famously put it, “there is no alternative.”
That’s a view which has been increasingly challenged in the decade since the 2008 financial crash. In the US, self-declared “democratic socialist” Bernie Sanders is one of the frontrunners to lead the Democratic party into the 2020 presidential election. On Amazon, books with titles like Communism for Kids meanwhile race up the bestseller lists. The idea that the state can and should play a role in the economic life of our societies is back in fashion.
All that would have worried Milton Friedman, one of the twentieth-century economists most closely associated with the argument that economic freedom is the only guarantor of political liberty. As he saw it, the road to hell really is paved with good intentions. What starts out as a promise to redress market imbalances ends up aiding monopolies, undermining living standards and – paradoxically – increasing inequality.
Was he right? Well, that’s something you’ll have to decide for yourself as you read these blinks. Along the way, you’ll learn
- why government spending doesn’t necessarily lead to economic growth;
- how a negative income tax could boost social welfare; and
- why basic education benefits society as a whole but university education doesn’t.