Home Economic Trends The Freedom Issue: Let’s be Sober and Proactive 

The Freedom Issue: Let’s be Sober and Proactive 

Many years we have seen the civil liberty – the basis of classical liberalism – is being under attack by populism, nationalism and authoritarianism. This has led us to great and tragic distortions in the social and political consciousness of citizens around the world, and moreover, to actual leftist extremism at the level of public policy in developed countries, and right-wing predatory mercantilism in developing countries. In this regard, it can be stated that the democratic world, as the basis and source of civilizational development, is responsible for the painful erosion and macro instability in which we exist today. 

Governments of democratic countries, or rather the establishment as a whole, have definitively shifted to etatism (the domination of state interests over the individual and the prevalence of state interests in the private lives of citizens in exchange for state guarantees of stable average welfare) and have firmly undermined the system of checks and balances in order to maintain the authority of power control of governing interest groups despite their ideological divergences. Giving a fish instead of a rod is always more advantageous for maintaining influence today and tomorrow: the masses of people, as members of a community, are not characterized by the ability to make long-term predictions. Such is the biology and individual assessment of prospects described by the recently departed great Daniel Kahneman.  For the day after tomorrow, there is always the Marquise de Pompadour’s thesis, “After us, let there be a flood”. 

The countries of the former soft autocracies, whose flagships – Russia and China – have pressed the gas pedal to the floor, rapidly transforming from authoritarian regimes of propaganda deception and manipulation into authoritarian regimes of dictatorship of fear with many nuances typical of totalitarian tyrannies: repression of dissenters, toughening of responsibility for not accepting ideological dogmas that are elevated to the rank of legislative norms, normalization of violence in favor of the interests of the ruling groups, etc.  

Today, in developed market democracies, the most extreme factions of the right and left have gone on the offensive and are squeezing everything out of their growing popularity. While claiming to be polar opponents, both are actually mirror images of each other. Both represent an ethatist force that views constitutional law, limits on the law, and separation of powers as “anti-democratic” and a pernicious restriction on the “will of the people.”  

The radical right storms the legislature when it loses elections; the left, by controlling the executive branch, increases government pressure . Both groups believe that diversity is chaos and dissent is treasonous and “anti-patriotic.” But the bottom line is simple: economically and in terms of social policy, both poles stand on etatist and interventionist positions, believing their dogmas to be the “messianic” truth. This is what is evident in the speeches of the leaders of both groups, from Biden to Trump.

Trump’s pro-Trump faction of Republicans agreed with giant government subsidies and questioned the efficacy of international trade.  Biden in fact did not change most of the tariffs and duties imposed by Trump, increased government spending extremely, and expanded the 

When some commentators bemoan the polarity of bipartisan ideological doctrines, we overlook the new bipartisan consensus that the American ideals of government – adopted from the Founding Fathers – of “arbitration and judgment” and “free market” have failed. And now we citizens are forced to choose an interventionist government that supposedly satisfies everyone by redistributing wealth and adopting every possible mechanism of etatist state domination to do so, like limiting free speech, curtailing social media speech, encouraging a culture of abolition, tightening regulation in many social and economic areas, etc.

The latest pandemic has shown that there is little or no limit to government actions and capabilities in this new etatist climate. It is perplexing how easily society as a whole has been isolated around the world. In 2020, 4.5 billion people – a huge portion of the world’s population – obeyed orders to stay home under threat of fines or even imprisonment. Companies, social institutions and other organizations were shut down by government orders. It all happened exactly in line with Hayek’s words that “emergencies have always been a pretext for undermining the guarantees of individual freedom.”

The problem is, these are not the paranoid musings of worried libertarians and classical liberals like me. We have clear and credible data confirming that global freedom is in sad and significant stagnation.

The Fraser Institute’s 2023 Human Freedom Index confirms that the coronavirus epidemic has had an exceptionally negative impact on human freedom. Nearly 90 percent of the world’s population has seen their freedoms restricted. However, it all started long before COVID-19: the index has been declining since 2007. In particular, freedom of movement, expression, religious freedoms, civil self-organization, etc. have been reduced, and the percentage of liberal democracies has fallen from nearly 25 percent in 2010 to 18 percent in 2022.

The Fraser Institute’s World Economic Freedom Index, which has a spectrum of values from 1 to 10, fell from 8.84 in 2000 to 8.14 in 2021. Sharp drops were recorded in property rights, and international trade freedom. The only thing keeping the United States in the top five is the even more dismal statistics of many other countries. In terms of global economic freedom, a decade of progress has been wiped out in 2020.

Obviously, the data needs to be evaluated in context. Yes, the “level of freedom” as a modern humanistic and economic value has declined, but from a level that may have been the highest in human history. 

When the recent decline is taken into account and all things considered, we can say that we are still at the historic peak of global freedom. This is important because it gives entrepreneurs and consumers the freedom to create innovations to solve many problems. Let’s keep in mind that we have had 20 years of crises, wars, terrorism, pandemics and restrictions. But those were the 20 best years in history if you look at measures of human well-being.

One-third of the income levels that humanity has achieved over the entire period of study were produced during those two decades. Global poverty fell by 130,000 people a day. Child mortality rates nearly halved.  In 2022, 4.4 million fewer children will die than in 2002 – a positive result unprecedented in the history of humans as a species. The number of hungry people has fallen by almost thirty percent. At the same time, global inequality has fallen for the first time since the Industrial Revolution.

What could be more substantial proof of the workability of individual free will?

But let us take into account the fact that such success is an evolutionary-dialectical change in the environment of existence-in other words, the institutions that determine (limit or motivate) human activity and its effectiveness.

When governments shut down the global economy during the pandemic, entrepreneurs in all sectors successfully customized production and distribution to rebuild supply chains in real time. And we were able to reopen the world sooner than expected because private companies developed a working vaccine against COVID-19 in record time. When one of the largest food exporters, Russia, invaded another major food exporting country, Ukraine, the world expected hunger levels to rise, but the agricultural sector responded to price signals, with producers increasing output and rapidly reducing prices to below pre-invasion levels (adjusted for general inflation).

Henry David Thoreau said that trade and commerce seem rubbery because they always “succeed in overcoming the obstacles which government constantly erects in their way.” This is undeniable, one need only appeal to evolutionary or anthropological logic.

Humans are always correcting government mistakes and coming up with innovative solutions. Sometimes this manifests itself in the form of new technologies that allow us to level out the constraints from above. We increased the number of cabs not by petitioning the government, but by coming up with apps to do so. Similarly, people have preserved free speech not so much by electing sensible government, but by creating social media.

Humans struggle for evolutionary progradation – survival and development – through problem solving, experimenting, adapting and improvising. However, this requires the freedom to maneuver according to local knowledge and individual creativity, and while Thoreau’s metaphor sounds beautiful, unfortunately, trade and commerce are not really made of rubber. It is impossible to overcome all obstacles through these tools. 

Every exogenous government restriction – regulation, tariff, and distortion of price signals – makes it harder for millions of people to adapt. It is always motivated by one thing only – the elevation of the interest of one small group over another, larger group.  This is why civil society is needed – a cooperative mechanism to protect freedom for everyone. Any recession can be the initial symptom of a destructive force that can undermine civil and economic liberty. 

Research showing that people form consumer preferences from advertisements is widely known, depending on the genre of the movie viewed, where those advertisements are embedded. Researchers asked a group of people to watch a horror movie or a romantic movie with a variety of commercials inserted throughout the movie. The commercials advertised products or services marketed as either popular or special, special. Interestingly, those who were startled by the horror movie rated common and popular products and services higher than products presented as unique. People who were cheered up by a romantic movie had the opposite preference – they would prefer a product that made them stand out from the crowd.

We have a significant corpus of social psychology research tracing these same trends in the political sphere. Any manifestation of global fear for ourselves, our lives, our loved ones and our general way of life encourages us to adopt a “strong arm”, a “bright leader”. We also become more socially conservative and more interventionist on economic issues. We get scared, so we want to attack, obstruct and destroy the enemy or hide behind barriers and walls.

Karen Stenner, a political psychologist, shows that authoritarianism is not a stable individual desire for social order, but a general tendency toward unity and uniformity of opinion at the moment of feeling threatened by the whole society or its individual unit – family, etc. Franz De Waal perfectly and vividly demonstrated the implementation of this concept on the example of describing the behavior of various communities of chimpanzees – great apes. In stable life, this is rarely manifested – even in animals – but when individuals feel threatened by the unity of the whole group, they react explosively. 

People want to protect their society, become intolerant of dissent, and are willing to restore unity through power/force, even if it undermines the rule of law, freedom, and individual rights.

Populists and demagogues in political groups hungry for electoral victory successfully parasitize this undeniable fact.  They keep the population anxious and the demands of the population itself for security. 

Since 9/11, the world has produced numerous movies with calypse and dystopia plots, deadly epidemics, terrorism, endless wars, global social chaos and decay. In 2008, the world faced the worst financial crisis since the Great Depression, which made the United States seem weak, capitalism a thuggish social regime, and the market economy a zero-sum game. All of this gives rise to a sense that the Western world is in relative decline, and this creates a chronic sense of insecurity in the United States and Europe and encourages autocrats around the world to challenge open civil societies. Thus is born a lot of cause for concern for the populations of the developed democracies and all of this is broadcast in real time as information is now instantaneous and comprehensive. 

We can see factors that reinforce the desire for unfreedom or anti-liberalism.  When one politician learns how to exploit the fear and dissatisfaction of the electorate, it is valuable knowledge that other politicians will quickly pick up. When authoritarian leaders like Erdogan in Turkey, Orban in Hungary, Xi in China, Putin in Russia, etc., find loopholes on how to hack the democratic system and destroy checks and balances, they pass the instruction on to other potential authoritarian leaders. 

Authoritarian regimes feed off each other. Arguments in favor of nationalism, protectionism, and war are no more than arguments in a playground fight: “he started it and I was just defending myself.” Obviously, this further radicalizes both the left and the right, giving birth to pernicious political populism.

This is the problem with replacing the principle of “live and let live with others” with the principle of “winner take all”: everyone feels they have to find a group to defend themselves. This is why both the ultra-right and the ultra-left are a perfect evil for a modern world with diverse lifestyles, views and influences. If you try to impose one ideal on everyone, you may talk about unity, but you are definitely ensuring polarization and animosity.

Let’s be honest and state that social media, and more specifically the instantaneous dissemination of information contributes to this, not only making it easier to validate your worldview, but also justifying your worst judgment t opponents. Have you ever noticed that you now spend a lot of time getting angry at a person who a moment ago you didn’t even know existed, or at least you don’t know them personally? That’s because your interest or belief group always finds the worst person or their quote on the opposing side. This adds to the sense of threat: if we don’t fight hard, this person alien to us will spread his threat, and who knows how my associates and loved ones will react to that. I and my surroundings are threatened – that is the biological reaction to any dissent or behavior that is informal to you. 

Yes, none of this is reassuring or causes us to feel stable. But at the same time there is no reason to feel hopeless.  Open order societies fail when citizens do not believe in, defend, or build upon their ideals, or more accurately dialectical foundations. Societies under authoritarian rule have a much more irreversible weakness: they fail when they manage to reach a limit in the realization of their ideas, to reach a certain end point. 

The desire to solve our problems instantly, from the top down, through tariffs, subsidies, regulation and price controls, indoctrination with a variety of “values” postulated as binding is nothing but a way of replacing the knowledge, talents, experimentation and individual self-awareness of millions of entrepreneurs, workers and consumers with the preferences of a small group of people – political predprnemalteoi, who usurp power and intensively shrug off their responsibilities to be accountable to civil society and to the specifics of society 

This is damaging to the economy, corruption is pervasive and becomes an institutional norm as people begin to make money by competing for “access to a resource” rather than market share.

In the United States, the tariffs that Trump imposed to protect U.S. jobs ultimately destroyed those jobs. Restrictive immigration policies have deprived the economy of much-needed talent and the ability to reduce costs, and the huge sums Biden spent on social support and income replacement have triggered inflation that has hurt the very recipients of the subsidies and grants.

The combination of business inefficiency and limitless expansion of power and resource benefits, is often enough to make populists suddenly unpopular in the end. Look at how the power of leftist radical presidents in South America collapsed. Poland’s populist right-wing government lost an election despite controlling the media. In Sri Lanka, protesters kicked Gotabaya Rajapaksa out of the presidential office. The Peronist destruction of Argentina was so thorough that voters instead chose to see anarcho-capitalist and Rothbardian Millay (an unimaginable event for the current left-Keynesian trend in world politics!!!) as president by an incredible 11-point margin. 

At the same time, China, while offering, in his view, a supposedly attractive alternative to Western liberalism, can only be successful further if the Chinese government liberalizes the economy and social policy by returning to a replication of Deng Xiaoping-era Western institutions. By suppressing private business, Xi is undermining the efficiency of the market economy, while increased state expansion and political tightening are reducing productivity and welfare gains – the foundations of inclusive market success. The destructive restrictive policies during the COVID pandemic undermined investor confidence in China and in “state care.” The fact that protests against these policies spontaneously erupted across China in November 2022 and that the Chinese state dictatorship felt it had no choice but to abandon these policies almost overnight shows that there is a significant reservoir of discontent in the country and that the Chinese authorities are afraid of it.

However, we shouldn’t get too upset. We, as biological individuals and political animals, tend to just pick and choose, disconnect, and get on with our lives.

But, as the saying goes: just because you’re not interested in politics doesn’t mean politics won’t be interested in you. As it happens, most people don’t pay attention to the predatory expansion of government until it comes close to completely destroying freedom, growth, innovation, and stopping civilizational peaceful development altogether. Is this not the sad and global process we are now witnessing in all parts of the world?

Despair and subsequent depression is just uninspired discontent, as psychologists say. We need to transform our frustration into inspiration. Freedom is always under threat because it is the main value for the realization of personal benefits, which, when not limited, lead in the opposite direction – to unfreedom. To preserve freedom it is necessary to realize that the freedom of your descendants depends on your freedom today, and therefore to act today. Let us act.