A free market engenders far greater innovation and economic growth than a government-regulated market can, said John Stossel, host of Fox Business show “Stossel” and 19-time Emmy Award-winning journalist.
“Most of life comes out of spontaneous order,” said Mr. Stossel, a self-proclaimed libertarian. In a talk titled “Capitalism and its Enemies,” given at Princeton University on Monday afternoon, he explained that a free, uninhibited system works best, and bureaucratic regulation inhibits efficient business.
The 1969 Princeton graduate recalled how difficult it was for him just to open a lemonade stand in front of his office.
“You had to get a government-approved fire extinguisher, pass a health department course, take a health department test, fill out all these forms,” Mr. Stossel said. “All these pointless rules — it doesn’t protect us, it just slows life down.”
According to Mr. Stossel, in Hong Kong, which has been ranked as the world’s freest economy, he could have opened his lemonade stand business in one day for a fee of just $25, versus the 60 days it would have taken him to do so in America.
Historically, government interventions such as the establishment of the Occupational Safety and Health Administration (OSHA) and President Lyndon B. Johnson’s War on Poverty don’t actually make much of an impact, but significantly increase government spending, Mr. Stossel said.
He cited a downward linear trend in workplace fatalities that was attributed to OSHA’s creation in 1971, but actually began much earlier than 1971. Similarly, he said, poverty rates were already dropping before the War on Poverty, and issues of government intervention actually caused progress to stop a decade later.
“What percentage of the economy should government be?” Mr. Stossel asked. “We’re now around 40 percent. For most of the history of America, when we grew the most, government was 5 percent or less [of the economy].”
Mr. Stossel also called government a “clumsy instrument” that constantly fails to improve business or elicit innovation, in part because of its slow bureaucratic structure and lack of incentive to create rapid change.
“[Elections are] only every four years. In business, in the nonprofit sector, you’ve got to be making improvements all the time,” he said. “Also, you don’t really have a choice every four years — Tweedledum, Tweedledee, there’s not that much difference.”
In contrast, Mr. Stossel noted, voluntary creation in the private sector has skyrocketed, and the so-called “greedy profit enterprise” has given us countless innovative products, from iPhones to toilets, that we take for granted as essential parts of our lives today.
“Although government fails, individuals manage to make our lives better in spite of all the economic obstacles put up by government,” Mr. Stossel said.
He also acknowledged that most people doubt the morality of the free market and view big businesses negatively.
“Without a real economic education, it’s easy to think of profit as something that comes at your expense,” Mr. Stossel said. However, he said, business operates on voluntary transactions and everyone gets what they want, versus a centrally planned system where consumers and producers are coerced into buying and selling certain products.
When asked about the fact that not everyone has access to the same resources or information in the free market, Mr. Stossel responded that although an unregulated market leads to greater wealth inequality, it still produces better results than a government-regulated one.
“Freedom isn’t equal or fair,” he said. “Some will get richer, but the only alternative is where everyone stays poor.”
Mr. Stossel said that there is no libertarian solution to climate change, when asked about the libertarian stance on global warming. “Pollution is an area for government,” he said.
He also stated that the current warming trend of climate change has positive consequences. “Warmer weather kills fewer people,” he said. “Since the globe is warm, we have less starvation.”
According to Mr. Stossel, climate change is also not the most pressing issue that should be addressed right now.
“We’re spending billions of dollars, giving it to Al Gore’s cronies for schemes and windmills and things that barely produce any energy,” he said.
“You wait 100 years, and science will advance, and maybe then if this is a problem, maybe then we’ll have the scientific tools to reverse greenhouse gases and then we can do something about it. But what we’re doing now is just an expensive, burdensome way to screw poor people.”
In response to a question about whether it is necessary for governments to push for clean energy innovation when nonrenewable sources of energy, such as oil, present the most lucrative business opportunities, Mr. Stossel said, “We have an energy policy in America; it’s called the free market.”
“If there’s something that delivers energy better than oil, someone will get filthy rich inventing it,” he concluded. “The idea that government’s going to know where the research should go is highly dubious.”
