by Ray Keating
The Keating Files – April 1, 2020
Free enterprise, capitalism or free markets – whichever term you prefer – has come under assault by some conservatives who assert that free enterprise doesn’t fit with conservatism, or if it does, it’s an uncomfortable fit. What such claims reveal is a misunderstanding of what conservatism and free markets are about in the end.
The word “conservatism” itself makes clear that conservatives are engaged in the act of conserving. But when it comes to the economy of late (and this has little to do with the coronavirus situation), some on the Right seem to think that this is about conserving or protecting particular industries, and even using government to attack others.
So, assorted conservatives support trade protectionism supposedly to conserve certain industries and jobs – particularly in the realm of manufacturing – while ignoring the wounds inflicted on other industries and workers, along with consumers. Still other conservatives (or the same bunch) seem to think that conservatism means using government’s reach to regulate, or even break up, large technology firms deemed to not treat conservatives or their issues fairly, or that make these conservatives feel uneasy about technological change.
Additional conservatives view various businesses as being the actual reason that assorted social conservative issues, for example, such as traditional marriage, have lost traction in the larger culture. Hey, why not point the finger at businesses? After all, who wants to take responsibility for failing to adequately teach and communicate conservative values and ideas? It’s easier to blame someone else, and look for a government bailout.
The greatest failing in these assertions is an inability or refusal to grasp that conservatism finds wisdom and benefits in certain institutions, ideas and principles. And one such institution or idea is free enterprise or capitalism (along with others such as, for example, the value in each human life, the role of the family, the Declaration of Independence, the Constitution, the Christian Church, and so on).
Conservatism involves conserving capitalism because of matters that are inherent to free enterprise, and what it produces. Essential to capitalism is freedom, with individuals free to pursue their hopes and dreams absent government coercion and terror.
And the essential and disciplining aspects of the market – such as profits, losses, prices, competition, cooperation and consumer sovereignty – incentivize people to serve others. That is, in order to succeed, capitalism requires that one must first meet or create the demands of others. This critical, altruistic aspect of capitalism was missed by Ayn Rand at one end of the spectrum, and by misguided conservatives at the other end who seek to establish some kind of bizarre conservative industrial policy, or who like the vague “third way” that assorted Catholics have embraced over the decades.
And of course, anti-capitalists on both the Left and the Right ignore one of the most monumental lessons of history: Free enterprise has proven to be the most powerful force in the entire history of mankind for creating wealth, and lifting people out of poverty.
Finally, beyond freedom and individual responsibility being essential to conservatism, other conservative ideas and values also buttress free enterprise, including the rule of law; virtue and trust; limiting government, and therefore, the ills that government power can wreak; the ability to support a family; and rewarding merit and excellence. Indeed, the list goes on.
Conservatism is not about conserving certain businesses, industries or jobs. Nor is it about using governmental power in other ways, such as trying to force people to believe the same things that a conservative might on certain issues, or using politics to allocate resources. Understanding the evil that government can do makes limited government and an expansive private sphere in life, including the private sector, essential to conservatism. In turn, private institutions that conservatives value are free to flourish – from free enterprise to the individual and the family to assorted faiths, including the Christian Church.
Playing the game that it’s okay for government to engage in industrial policy (where politicians decide that certain industries should be subsidized and protected), and to fail to adequately protect our freedoms, has nothing to do with conservatism. Instead, it’s usually about populism, authoritarianism, and/or nationalism. In fact, these are the waters that Progressives most often swim in, not conservatives.
The conservative should be wise enough to understand what inevitably happens when government is empowered, and no principled conservatives can be found or they have been corrupted by political power.
Free enterprise, in turn, serves as one of the great checks against the power of government to do evil.
Free markets are not peripheral to or a stepchild of conservatism. Rather, capitalism is essential to conservatism. If one tosses aside free markets, then one is tossing aside a foundational aspect of conservatism – and “conservatism” ceases being conservative.
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Ray Keating is a columnist, an economist, a novelist (his latest novels are The Traitor: A Pastor Stephen Grant Novel, which is the 12th book in the series, and the second edition of Root of All Evil? A Pastor Stephen Grant Novel with a new Author Introduction), a nonfiction author (among his recent works is Free Trade Rocks! 10 Points on International Trade Everyone Should Know), a podcaster, and an entrepreneur. You can also order his forthcoming book Behind Enemy Lines: Conservative Communiques from Left-Wing New York – signed booksor for the Kindle. The views expressed here are his own.
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