The therapy of markets

James Peron, president of the Moorfield Storey Institute and author of several books, including Exploding Population Myths and The Liberal Tide, is a contributing author for the Free Market Foundation.  

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This article was first published by the Bbrief on 15 March 2023

The therapy of markets

One of my privileges in life was to come to know and be friends with Dr. Nathaniel Branden (1930-2014), considered by many to be the father of the self-esteem movement. 

I spent time listening to him lecture in person and on video, and spent hours in discussion in his home and at his dinner table. Somewhere along the way he said something that struck me as particularly profound, even if I can’t remember precisely where or when. But it got my attention—it wasn’t the first time his observations did this for me.

He was discussing the similarity between psychology and a liberal/libertarian system of economics and governance. Being my career has been writing about politics and my academic background was strongly in psychology and sociology with economics my hobby, this got my attention.

He said the proper goal of therapy and a free society was the same: the expansion of individual choice and freedom. It was a short comment and I never got around to ask him to expand on it, but I knew him well enough to know it came with the caveat, “provided one does not violate the rights of others.”

One thing psychological problems do is limit your options, they restrict you and the choices you can make. Consider the similarity between phobias and a regulatory system.

Think about the agoraphobic: where one of the symptoms is a fear of the wider world. This fear severely restricts options and the resulting benefits individuals have with freedom of movement. I lived in four different countries and saw a large part of the world. I met wonderful people around the world. I consider that a major benefit of my life. With agoraphobia I would never have profited from those experiences—and remembers, profit is always more than just financial gain.

Statism is the opposite of liberalism—it means state control and state provision of important good and services. Now when I moved to New Zealand one of the first things I did was switch my electricity from the current provider for the premises I rented and hired a different provider.

There are five companies producing electricity in New Zealand and switching providers was as easy as dialing the phone. I suspect a lot of Eskom’s customers wished they had that option today. And they could have, except government won’t allow it.

One of the major differences between statism and liberalism is statism severely restricts your choices—the same way phobias do. The more choices you have the more likely you are to find one to optimise your life. You have a better chance of improving your life the more choices you have and less chance of improvement the fewer you have.

A key purpose of therapy is to help you expand your choices. If you are afraid to travel your options are severely limited. If therapy helps you overcome that fear your available options expand dramatically. If you lack confidence in your self you won’t make choices most likely to have higher returns. You will be hesitant to take a bigger risk and that tends to mean you must shun the bigger returns or profits as well.
Of course, profits and costs cover more than monetary returns or expenditures. It means all costs and benefits. If you go to the movies on Friday you can’t simultaneously have a night out walking along the beach. You give up one in order to do the other. If you create a business and it works, you gain economic profits, but you also have psychological gains—a sense of satisfaction and esteem.
Liberalism is about maximising individual choice consistent with individual rights. Good therapy is about maximising individual choice as well. I would argue these choices always have to be consistent with individual rights, thus maximising the choices and result benefits for others as well.
One of my greatest pleasures is when I see good things happen to other people. It makes me smile, I feel happy when it happens. I lived in liberal societies and experienced a heavily statist one in South Africa.

The results I’ve seen is liberal market-based societies have higher life expectancy, higher rates of employment, greater prosperity for all, better housing, and lower crime, just to name a few. The more choices the people have the happier and better off they tend to be.

Just as a good therapist helps maximise the client’s choices in life, a good government does the same thing. A therapist who imposed phobias and diminished the client’s options would lose their license, be sued for malpractice and put out of business. The same should apply to politicians who reduce choices and maximise suffering.

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