The Economics of Martin Luther King, Jr.
Posted on: 2012-01-17 04:35:16
We're supposed to venerate Martin Luther King, Jr., but that's not easy for a believer in economic liberty. Time and again, King called on us to "question the capitalistic economy" and "restructure America."
"You see, my friends," said King, "you begin to ask the questions, 'Who owns the oil?' You begin to ask the question, 'Who owns the iron ore?' You begin to ask the question, 'Why is it that people have to pay water bills in a world that is two-thirds water?
Privately owned oil and iron ore mean rational use, whereas government-owned resources, as in the U. S. S. R., mean chaos and poverty.
Although America's water systems – municipalized or regulated – are not exactly free enterprise in action, we have to pay for water for the same reason we have to pay for anything valuable. Fresh, clean water is scarce, and the price system ensures that it will not be squandered, while encouraging further production.
King favored a "higher synthesis" – part individualism, part collectivism – as in Sweden. But one of the least-known aspects of the anti-socialist revolution has been its effect on Sweden, which has been getting poorer and poorer thanks to decades of redistributionism. Today, the people are demanding lower taxes and less government, much to the consternation of the Swedish establishment. As Ludwig von Mises demonstrated, the mixed economy is inherently unstable. It must tend towards either statism or the free market; there is no economically rational way of reconciling the two.