Paradox of free markets, free people
By Beth Cody, Writers’ Group member
Iowa City Press-Citizen
Friday, June 15, 2007

Iraq: what a mess. Waning public support for the war, goals not accomplished, civil war if we bring our troops home. But history shows that there’s a much easier way to achieve peace in the area: Encourage economic freedom through free trade contacts, and political freedom will eventually follow.

Studies suggest that economic freedom leads to political freedom – not the other way around. Poor citizens aren’t powerful or knowledgeable enough to demand political change, but wealthier ones are – and economic freedom is how to achieve wealth. And encouragingly, the world is becoming more economically free, as measured by the Wall Street Journal’s Index of Economic Freedom. This increase in global economic ties has been accompanied by advancements in political and civil rights in numerous countries.

So clearly, to bring about political freedom in other countries, we should encourage economic freedom and its accompanying institutions (transparent legal systems, property rights, etc). And the best way to do that is to trade freely with them, so that they (and we) become wealthier.

With closer trade contacts, it’s not just commodities that are exchanged. Books, television, internet, students – the ideas of free nations become accessible to formerly-isolated citizens. They can see how much better political freedom is and demand it for themselves.

Economic freedom is probably even more important than political freedom, and not just because the one leads to the other. For average citizens of poor countries, getting enough to eat is more important than voting rights, at least until they’ve reached a certain level of economic comfort, usually denoted as being middle class. In corrupt, repressed nations, money is often held solely by an elite group. But economically free countries develop a middle class that is usually responsible for bringing about political change.

That’s what happened in Chile: to make his country more powerful, the murderous dictator General Pinochet instituted free market reforms during the 1980s. The resulting growing middle class then demanded more political freedom and eventually overturned his rule peacefully.

Peaceful political change, and no need for us to bear the cost of being the world’s policemen – bad for the military-industrial complex, but great for the rest of our economy, to say nothing of the lives spared. During the past half-century, if we had understood that economic freedom eventually triumphs over totalitarianism, we could simply have waited out our “enemies” and spared about 100,000 of our young men and women.

For example: 60,000 Americans (and 3 million Vietnamese) died in our Vietnam War, but we still failed to prevent Communism from taking hold there. However, since Communism results in poverty, in the 1990s Vietnam quietly renounced its Marxist ways and now has the world’s second-fastest-growing economy. They’ve re-established diplomacy with the U.S. and are slowly moving toward political, religious and personal freedom. Telling them that freedom is better didn’t work, they had to discover it for themselves.

Now that our latest “enemy” is Islamic fundamentalism, the situation is exactly the same: Religious and economic repression makes countries poor and weak, with many unemployed young men who possess little but time to nurture their legitimate resentment of the U.S. (After all, we impose economic sanctions that impoverish them, meddle in their sovereign affairs and militarily invade and occupy their countries.)

Instead of trying to force them to be “democratic”, which doesn’t lead to wealth, but only keeps them radicalized, we should leave them alone and simply open our markets to them. They will eventually become wealthy, stable countries in which the people are peacefully occupied with the business of improving their standard of living each year.

Far from being “isolationist,” this policy would allow unlimited contact between companies and individuals. And trade tariffs would no longer discriminate against developing countries to protect our own wealthy industries.

Some people will think I’m ridiculously naïve and simplistic. It does seem too good to be true: to resist tyrannical leaders, simply stop bullying and start trading freely. There’s no need to make the world hate everything we stand for, extract heavy taxes from our citizens or sacrifice our children in wars – just let individuals trade as they wish. But that’s the extraordinary paradox of free markets and free people.