If you care about free people and free markets, you’re probably alarmed by the growing socialist trend in America, particularly among young people.
To help counter this trend, Nikki Haley recently offered spirited defense of the free-market system, in which she explains why it is the only real road to prosperity.
In a speech to the Hudson Institute (a former employer of mine), Haley, a former South Carolina governor and United Nations ambassador, explains that the socialism-versus-capitalism debate is actually a debate among three viewpoints: There are those who support capitalism; those who support socialism; and those who support a “watered-down capitalism,” which is really “the slow path to socialism.”
Capitalism, Haley points out, has made the world “cleaner, healthier, and wealthier than ever.” Since 1800, she notes, after which America became an industrialized nation, average real income per person has skyrocketed by 4,000 percent and life expectancy has soared. Medical and technical breakthroughs, made possible by free markets and capitalist innovation, have boosted living standards for everyone.
Capitalism promotes innovation and human flourishing, a system in which “people can find jobs that match their talents and passions.” Because of capitalism, “America has lifted up more people and unleashed more prosperity than any other country in human history.”
By contrast, she says: “Socialism is the dangerous proposition that government should control more of your life, including your property, your money, and even your religion.”
Many American socialists say they idealize a “democratic” socialist system, with a larger welfare state and higher taxes to fund it. They often cite Scandinavian countries as a model. But Scandinavian policies have changed a great deal since their high tide of socialism in the 1970s and 1980s. Denmark and Sweden have both moved in a more free-market direction. Sweden has trimmed taxes and introduced school choice.
(For more on the real lessons from Scandinavia, check out my 2016 IWF policy focus.)
What about the third way, trendy, so-called stakeholder capitalism that even some conservatives support, in which companies focus more on social issues? This alternate capitalism isn’t really capitalism, says Haley. Rather, “It will make business the servant of politics. Few things are more dangerous than big government in cahoots with big business.”