How Free Markets Make Poor Countries Wealthy (feat. Benjamin Powell, Ph.D.)

by | Sep 10, 2022

Here’s why: almost a hundred years ago, the Austrian economist Ludwig von Mises explained that socialism, even if run by benevolent despots and populated with workers willing to work for the common good, could still not match capitalism’s performance. Socialism requires abolishing private property in the means of production. But private property is necessary to have the free exchange of labor, capital, and goods that establish proper prices. Without proper prices, socialist planners could not know which consumer goods were needed or how best to produce them….Socialism also gives tremendous power to government officials and bureaucrats who are the system’s planners—and with that power comes corruption, abuse, and tyranny. It is no accident that the worst democides of the twentieth century occurred in socialist countries like the Soviet Union, Communist China, and Nazi (National Socialist) Germany, where planners simply decided to eliminate populations they thought interfered with their plans.

– Robert Lawson and Benjamin Powell, Socialism Sucks: Two Economists Drink Their Way Through the Unfree World

Dr. Ben Powell is the Executive Director of the Free Market Institute at Texas Tech University and a Professor of Economics in the Rawls College of Business and a Senior Fellow with the Independent Institute.

Other books discussed:

Wretched Refuse?: The Political Economy of Immigration and Institutions

Out of Poverty: Sweatshops in the Global Economy

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Keith Knight is Managing Editor at the Libertarian Institute and host of the Don't Tread on Anyone podcast.

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