This comment, which was written by Mr Punche-Bagge, was forwarded to us by Jim Makin – Ed.
We want it, we demand it, we fought for it. It must be pretty special … what exactly is it?
As a nation, it is the ability to make our own contribution to the world, and to tell those who would dictate our actions that we make our own decisions (in the nicest way commensurate with the threat).
It is the ability to appoint our national and local governments by whatever means we choose.
In commerce it is the ability to imagine, design, make and/or trade any product, and to join with others within an enterprise to do so.
At the personal level it is the freedom to speak as we choose, to associate with others who choose to associate with us, to make voluntary agreements with others and to decide how we will earn our living and bring up our progeny. It includes the freedom to make our own mistakes and to learn from them.
Inevitably society demands responsibility. Over the centuries British Common Law has evolved to curb our tendency to irresponsibility by establishing the principle that we may think and act for ourselves provided that we cause no damage to others.
Over centuries we have evolved a system of government which although imperfect, is yet more perfect than those that went before. This a still a work-in-progress, yet others envy our privilege to elect our leaders.
The market has evolved over millennia from a place where the locals gathered to trade their produce to today’s world-wide marketplace humming 24/7 on the internet.
The market enables willing buyers to negotiate with willing sellers to strike a deal. The negotiation may involve months of work or may be a simple comparison of one price against another. Some call these deals win-win because they are struck only when both parties perceive a benefit.
The market increases productivity by enabling us to specialise according to our expertise (maybe wood-carving), whilst also meeting all our other needs (eg: food, housing).
It mitigates shortages through the price mechanism – people will learn how to make higher priced products from which they can get a better return for their labours, and will stop making low-priced items when they cannot make a living. As supplies of high-priced products increase, the price will drop, and as low-priced products become more scarce the price will rise until people can again make a living from them.
This demonstrates the market’s excellent function – it establishes prices that maximise overall satisfaction. As circumstances change, prices are adjusted. This price discovery results from the constant re-evaluation of the price at which free participants will strike a deal (so, are central bankers really surprised that massive buying interventions in financial markets under QE associate with impeded productivity, dragging GDP, and inflating asset bubbles?).
Finally, whilst originally a market was nice to have, it is now essential to our survival.
Governments specialise in compulsory deals (win-lose).
They constrain win-win deals because they take a dislike to some aspect of the product or the people concerned. They support one class of deal-maker over another (tenants versus landlords) and they ban certain trades altogether (class A drugs).
They restrict trade and increase costs by licensing and regulating only selected participants (pharmacies, pubs, fishing).
They subsidise pet ideas (“renewables”) and tax pet hates (“carbon” fuels, imports) thus increasing cost to the taxpayer / customer.
They establish QUANGOs and Regulators to perform similar activities without the accountability of elections.
They nationalise industries, creating vast monopolies (NHS, police, transport infrastructure). (In a double-whammy, Labour would both nationalise industries and encourage national unions, pitching one monopoly against another in guaranteed destruction of customer satisfaction).
They consult vested interests on market regulation (the vast commercial lobby in the EU promotes the passing of ever more regulations creating barriers to competition).
They monopolise education to indoctrinate our children, to perpetuate their power and subvert our parental responsibilities (religious , Marxist, communist governments …).
They task their agencies to intervene in people’s lives by bringing them before the (Family) Courts, under proceedings closed to scrutiny and susceptible to miscarriages of justice.
Lastly (surprise!) politicians make work for themselves – perhaps the one reason why we now get by with four parliaments rather than two and why we joined the EU – they are still determinedly mining that rich seam by deliberately complicating the BREXIT process.
To pay for all this they devise arbitrary rules to confiscate money from you with menaces.
Governments have even tried to replace markets by central direction – resulting in the black market. Markets will out not because they are useful but because they are essential.
OK, maybe I exaggerate to make a point, but how much? (And I haven’t mentioned corruption…).
John O’Connell of the Taxpayers Alliance eloquently makes some of these points for our own UK here.
So what should government do?
Although the defining characteristic of a free market is that the participants will normally regulate themselves by walking away from a deal that offers them no benefit, how to ensure that win-win deals for the participants do not result in win-lose for non-participants?
It falls to governments to uphold the win-win aspect for deal participants and non-participants alike, implementing restrictions where evidence exists that demonstrates that deals are win-lose overall.
So what to do?
The win-win argument needs to become a cornerstone of political thinking in the public mind. The more that people understand win-win markets and win-lose government diktat the more they can judge the merits of an election manifesto for themselves.
We need to be making this argument all the time.
We need a process whereby each party’s manifesto should be (a) costed and (b) subjected to a win-lose analysis by independent (economic?) institutes. This would provide the foundation for a logical appraisal of the extraordinary policies that are currently welcomed unhindered into election manifestos.
Difficult? You bet. Impossible? UKIP could set this ball rolling. After all, we have achieved the impossible once already.