We are, and of right ought to be, free. We are the possessors of our own life and it is this ownership of our being which gives us a right to be free- free to pursue our own ends for our own sake, and free to keep the fruits of our labor, whatever they may be. This, then, is the cornerstone and fundamental justification of the free enterprise economic system. Individual freedom and the free enterprise system are inexorably interdependent. If you lose either, you lose them both.

 

It is well documented that free enterprise works for the betterment of man-even though that is not the primary of the system. It works because it is properly grounded in a valid philosophy which is in concert with human nature. All other philosophies and systems fail on this essential point. To understand this, ask only one question of yourself: How would I react if what I “earned” bore no relationship to my effort, talent, training or productivity? What would you think: what would you do? This is the essential distinction between a free- enterprise (demand-directed) and a state controlled (command-directed) economy. This, in turn, revolves around the crucial philosophical distinction between man as a free being or a being subservient to the state.

 

It is this concept of man as a free being which is required to develop a political system that protects the rights of man and promotes progress for the future by allowing human nature to work in a positive way. This concept is at the core of the political system, uniquely developed by our Founding Fathers. The philosophical basis for the American political system seems often to be misunderstood by those who live under it and this misunderstanding has caused a slow erosion of the system.

 

As it is true that an individual’s life is his property as surely as the automobile he has bought with money he earned, or the food he has grown by his own labor, it is equally true that a neighbor’s life and property are his own. We neither have the right to claim the other’s property, directly or indirectly. Rights, are the property of individuals: hence the often misleading term “individual rights. “These can be best summarized as the right to “life, liberty and the pursuit of happiness.”

 

If rights are to exist, they must be protected. In a true anarchist state or a barbarian world, there is no protection for those rights. There is no protection against the arbitrary whim of a person to violate individual rights. This ultimately leads to rule by brute force, whereby the “brute” with the biggest club, or gun, or army, will become a form of government. The “brute” will dictate to others what they can do, what they can own or even if they will live. This “dictatorship” has, then, stolen the rights of the individuals and taken them for the “governing.” It is a form of government which has never, and will never, work for the betterment of man but only for the brute and his chosen henchmen. It is understandable why the brute wants this. Yet it is incomprehensible to any lover of freedom why anyone will allow this right to life and property to be so blatantly taken from them. Nonetheless, there is no law, no government, no one who can take a man’s right to think- not even the brute.

 

The proper role of a government, which preserves the rights of the individuals, is to guarantee the rights of all individuals. In order to accomplish that end, it must, of necessity, be granted certain powers. A government has no innate rights- it has only the powers granted to it by the people who created it- and none other. All rights not surrendered to the government, therefore, belong to the individuals who comprise the political unit.

 

The original Constitution of the United States was created by the elected representatives of the people. This creation represents the purest form of government based on the philosophy of individual rights to life and property. The individual was free, but not without restrictions which guarantee the rights of others.

 

Government’s primary purpose is to protect our “inalienable rights.” To do this, the government has and needs a monopoly on the use of force-but only for particular purposes: namely, police power to enforce laws and protect individuals from other individuals: and an armed force to protect the individuals within the political unit from other governments or people. To further protect our “inalienable rights”, other government functions are required, such as the power to create laws, and to administer a judicial system to determine if laws have been broken or to determine if the rights of individuals have been violated by such laws.

 

In the United States Constitution, the “Bill of Rights” was specifically included to protect our individual rights from government usurpation. Our Government was designed and intended to be our servant-never our master. So long as any government which is based on individual rights stays within its proper purview, we will be free and independent individuals, whose rights remain supreme.

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It is within this philosophical and political environment that a free enterprise economic system can properly exist. And it is only through our individual knowledge, awareness and active participation in its protection, that our free enterprise system can properly be maintained.

 

In a free enterprise system the individual is free to pursue his own ends, by his own means, for his own sake-so long as he stays within the law. He is free to own property and to keep the fruits of his labor. Government is not free to arbitrarily abridge his freedom to act, nor is it free to arbitrarily take his property.

 

When individuals are free to pursue their own self-interest, they are motivated to do so, because each is the beneficiary of his or her own efforts. This is the proper psychological environment from which progress and the betterment of mankind results, not because that is the aim of the system but as a resultant by-product of the system. Adam Smith in The Wealth of Nations describes this as the “invisible hand” which results from each person pursuing his own self-interest. It is in this pursuit of one’s own self- interest that some will create new products: some will produce more or better products: some will create beautiful music or works of art and most will work harder or smarter. The result is a creation of more wealth, more comfort, more convenience and more culture for society as a whole.

 

It is a system which positively captures the essence of human nature. The incentive and reward are aligned to keep the fruits of our labor. Human nature has not changed, nor will it. We will always work harder, smarter, more creatively when there is a reward for our efforts. The unintended outcome is more wealth for all. Whether or not we choose to recognize it, the wealth results “not from benevolence but from self-interest.”

 

We are no two alike, nor should we be. We are born with “inalienable rights” but born with different characteristics, in different environments and learned of different values. The notion of equality is one of equal rights under the law, not one of egalitarianism. We are not “entitled,” we must earn.

 

The philosophical beliefs, political system and psychological environment in which a free enterprise economic system properly exists does not, however, deny the need for proper ethics and morality. We must do what is proper and right, based on our beliefs and values, but it is not our obligation to sacrifice ourselves for the sake of others.

The systems which previously have been free enterprise and have drifted to socialism and government ownership of industry (e.g., England) have not kept pace with their free enterprise counterparts. The efforts toward egalitarian balance have not helped the wealth of the nation, but have rather done just the opposite, as relative standards of living decline and the more creative and productive have gone where they are rewarded for their efforts. It is on the sometimes well intentioned actions of the altruists and the egalitarians that the intended beneficiary’s body rests: a society in decline. In decline because it ignores the psychology of human nature and the political/ philosophical environment which captures it in a positive way.

 

The system in which there are little or no freedoms, where power rests totally with the government (e.g., Russia), and the fruits of one’s labor is taken at the “point of a gun,” have hardly begun to produce plenty. Is there and wonder why so little is created and produced! There is no motivation! Such a system flies in the face of human nature. When these same governments have experimented in limited ways with letting their subjects personally benefit by their efforts-output has increased dramatically. Witness such recent examples in China and new Russian proposals aimed at creating personal incentives. These leaders understand what works but are unwilling to give up their power to the people, who are the servants in their system, until the servants begin to wither from their “imprisonment” or actually rebel.

 

It is clear to all who care to look, that all of society benefits when individual rights are guaranteed and human nature is directed in a naturally positive way. To deny this is to be blind to ignore reality. Where, then, are We, the United States of America? Though blessed with the wisdom of the originators of our Constitution and Bill of Rights and the centuries of thought that influenced them, we are embarked onto an unlighted path we do not seem to see. We have able-bodied, who do not work: we have unions, who make work: we have products, which are priced to high: we have government, who interferes with our daily life: we have politicians, who promise “two chicken in every pot:’ we have government bureaucracy, which is out of control; we have a growing welfare state, which robs people of their dignity and incentive; we have altruists, who are unaware they are hurting their own constituents.

 

We are slipping. We have wandered off main road onto a path we dare not follow if we value our freedom and our free- enterprise system. Yet many freedom-loving persons- people who sincerely believe in and support the free-enterprise system-fail to notice the slow, insidious and steady erosion of that system. It occurs in many forms- greater government controls to “protect us;” increasing tax burdens at all levels (sometimes disguised as deficit spending); laws and regulations which increasingly encroach on our personal freedoms. The time to stop and clearly see where we are and where we are headed is NOW – before we reach the point of no return.

 

It is not too late but neither is it a moment too soon. LISTEN – LEARN -THINK- ACT. We must not take from our heirs the most precious thing we were given by our ancestors- Freedom.

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ABOUT THE AUTHOR

 

Leslie A. Rubin, a 1964 graduate of the University of North Carolina, first became interested in economic education when he went into business for himself in 1974 as a developer of office and industrial parks. It was then he discovered how few people- in or out of business -fully understood how our free enterprise system works, or what impact they, as individuals, could have on its survival or demise.

 

In 1980, Mr. Rubin founded the Economic Education Council of the Pinellas Suncoast Chamber of Commerce in Florida and chaired it for the first two years of its existence. The Council, in partnership with the Pinellas County school system, has developed more award wining economic education programs than any other county in Florida, and the State of Florida has won more economic education awards than any other state in the nation.

 

In 1979, Mr. Rubin was named Free Enterprise Man of the Year by the Suncoast Chamber of Commerce and in 1985 received the Phi Delta Kappa Outstanding Layman Award in Education.