Business Day column: Why do we allow power freaks to exploit us?

THE evidence that almost everything for almost everyone almost everywhere is better when governments are smaller and individuals freer is so overwhelming that there is no room for informed doubt. Nobel laureate Friedrich Hayek observed that governments can do more for people by doing less. Yet, in this country, the government is bigger and more powerful than ever.

Why does coercion and dispossession appeal to seemingly sane people, especially intellectuals? Why do they oppose free people freely interacting in free markets? Do they hate liberty, or prosperity or both? Are antimarket fundamentalists ignorant or deranged? Does megalomania, hallucination or dementia intoxicate them?

Personal freedom is conceptually simple yet commonly misrepresented and misunderstood. It exists when no one does anything to anyone or their property without informed consent. It makes no distinction between personal and economic freedom, or private and government coercion. The consent axiom is pro-choice on everything including capitalist acts between consenting adults.

You are not free when health laws determine what you consume; when labour laws prescribe terms on which you sell your labour; when land laws decide what happens to your land; when unsporting laws regulate who plays in your team.

Misinformed people fear that free people will be "exploited". They think we are clever enough to control our vote, but too stupid to control our lives. They want regulation not education. Nelson Mandela preferred liberalisation and education. Someone "denied the right to live the life they believe in has no choice but to become an outlaw".

Power junkies fantasise, according to economic philosopher David Friedman, that government power will not attract power freaks, people with power will not be biased in their own interests, clever people will not use power to serve their ends, and rivers will run uphill.

People who benefit from power and patronage espouse it, but what explains "decent" folk motivated by concern for human and environmental welfare? Why do they want your life controlled by people called "government"? Why do they think remote people with one-size-fits-all prescriptions care more about what is best for you than you do with your intimate knowledge of your circumstances and preferences? Why are they unconcerned about dignity and happiness? Health policy obsesses about physical health at the expense of emotional happiness.

The danger of government power is revealed by the fact that what it entails would be criminal or insane if done privately. If you threaten innocent adults with violence unless they obey you, you are nuts or nefarious. But if you are an "official", private vice becomes public virtue. It would be preposterous, for instance, for civilians to stop consumers getting lower prices by forgoing warranties and cooling-off periods. Yet that sort of madness characterises countless laws.

Why objectively freer markets outperform less free markets by all objective criteria is easily explained. In the absence of force or fraud, all deliberate action promotes what people value more above what they value less. The right to maximise personally assessed reciprocal benefits motivates people. Since controls reduce options they suppress ideal outcomes.

"Government failure" arises because "there is no such thing as a free lunch." All regulatory benefits are usually exceeded by costs, including "unintended consequences", "distortions", "regulatory capture" (by vested interests), abuse of power and corruption.

Why do intellectuals not get it? Maybe they do, but their self-interest is to feed off the teat of state. Most benefit from state patronage and funding. Primarily at their behest, liberty or property are not safe when legislatures are in session.

• Louw is executive director of the Free Market Foundation

This article was first published in Business Day on 6 July 2016

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