The frontiers of the state are rolling forward once more, and free enterprise is under threat. Companies now face a more difficult environment in which to do business than at any time in the last 40 years. Numerous studies show the public’s apathy, and even hostility, towards free enterprise. Across a range of issues, the public favours greater state intervention over freer markets. People in the UK are now keener on raising taxes and public spending than at any time since 2006, according to the British Social Attitudes Survey.
Where the people lead, politicians follow — they are reacting to the public mood. Today’s leading socialists are open about their revolutionary goals: speaking of ‘overthrowing capitalism’, and proposing policies to restructure the economy and create a more activist state. These policies include the suggestion that Treasury rules should be rewritten to encourage investment in the regions. That workers at firms with more than 250 employees should be given a stake in their business. And, in a move straight out of the playbook of many failed socialist states, they are calling for the renationalisation of the water and rail industries, the energy networks, and the Royal Mail.
The Centre for Policy Studies estimated that this renationalisation would cost nearly £176bn. That’s the equivalent of nearly £6,500 for every household, or adding 10 per cent to the national debt. So, many businesses face an existential threat, and we all face a more aggressive political environment.
How do we respond?
For too long, those of us who believe in free enterprise haven’t been making the case for it. Where we have, we have only presented the material case. Facts, figures, and measurable benefits. Free markets are responsible for the greatest reduction in poverty the world has ever seen. Millions if not billions of people are wealthier and healthier as a result. We are inclined to repeat these lines. But this strategy isn’t working. Even if the message is getting through, it’s not having the desired result. Material arguments have failed to stem to tide of government intervention, and the leftward drift of politics and economics.
What’s more, repeating the material case has enabled those on the left to paint free enterprise advocates as selfish and motivated only by money. Those in favour of greater government intervention and control have been able appropriate morality for their own ends. Just look at the claims of a ‘kinder, gentler’ politics. Left with a binary choice between the moral left and the materialistic right, it’s easy to see why the public swings left. It is this lack of a moral argument for free enterprise that has contributed to Britain’s leftward march.
The moral case for free enterprise
To protect and enhance free markets, we need to be making the moral case for free enterprise. This isn’t a new argument. Adam Smith first made the moral case for freedom in The Theory of Moral Sentiments, some 17 years before he made the economic case in The Wealth of Nations. But if it’s not a new argument, we need to be better practised at making it. We must be able to discuss and argue for what we see free enterprise has given to our lives, and the opportunities it has created for us and will do for those in the future.
The moral case rests on the principle that it is only with free enterprise that we can match reward to merit. Free enterprise enables us to decide how to spend our time and talents to shape our lives. It enables us all to take risks, innovate, and — quite often — to make sacrifices to earn our success. Numerous studies show that earning our own success is essential to our fulfilment, and ultimately our happiness. Just look at small business owners, of which I am one. Many make less money than they would if they were employed. But they are often happier and more fulfilled because they can see the result of the effort they put in.
What persuades us of the benefits of free enterprise is the story of someone who started life with very little, yet made the best of the opportunities they had, and earned their success. To change minds, we need to make the moral case for free markets. Facts and figures should playing a supporting, rather than a leading, role. And rather than relying on our politicians or our think tanks to make the case, we need to ignite the people around us to make the case as well. This is important because the public trusts their peers more than they trust elites and institutions.
We need to mobilise the millions of entrepreneurs, small business owners, and hard-working people who see that free enterprise is the best method for them to earn their success and be fulfilled. To win the moral case, these are the better and more compelling stories we need to share. And we need to tell them in more human ways. In doing so, we might just be able to hold back the erosion of free markets, and rekindle a new period in which free enterprise is appreciated for what it is: the best and most moral way for us to live our lives and earn our success.