Blog Essay L6

If I were to create my own city in an uninhabited part of the globe where people would come to find opportunity, I would set up a free-market system. To do this, there would be certain key institutions that the government would have in place. I would have a constitution that outlines these institutions. The first is that all citizens must have the right to life. The second is that there must be personal and economic liberty. The last is that everyone must have a right to property. These institutions would be there to ensure economic growth and prosperity.

The first institution that will be in place is the right to life. This right precedes any economic prosperity. In the introduction to I, Pencil we learn that, “All of us can be left at liberty to choose and act as we think individually to be best, and our decisions will be spontaneously brought into harmony through the prices of the market.” As we are given freedom and the right to life, we make positive contributions to the economy. Without the right to life, it would be a tyrannical system that could not succeed economically. In places where this right is not respected, there is not economic prosperity. Additionally, as we discussed in class, statistics show, when more freedoms are given, the economy is more successful. The right to life is the first basic institution for a prosperous economy.

Second, there must be personal liberty and free choice as well as economic liberty. As Ezra Taft Benson says in “This Nation Shall Endure,” “Nothing is more to be prized, nor more sacred, than man's free choice. Free choice is the essence of free enterprise. It recognizes that the common man will make choices in his own self-interest.” The concept of people acting in their own self-interest is key for economic success. When buyers and sellers act in their own self-interest it is good for everyone. Sellers produce what buyers want, and in turn buyers get what they want. The government also takes away liberty by requiring more and more of its citizens through taxation. In turn, the citizens have less to spend on medical care, education housing and food and must rely on the government to cover such things. According to Ezra Taft Benson, “When that happens, liberty is gone.” This would hinder economic growth. There must not be many limits on business also because that slows down economic growth. For example, when the government tries to regulate an industry, they eliminate competition and there is no incentive to improve the goods or services provided. There is no need for the government to try to manage the economy. As described in I, Pencil by Leanord E. Read, there is no mastermind in the creation of many products. In fact it would be near impossible to try to control all aspects of making a product as simple as a pencil. Rather the invisible hand of economics works it all out. Therefore growth is hindered as the government takes away economic liberty.

Finally, it is absolutely essential for economic growth to have the right to property. Without the right to property, President Benson says there would be, “no incentive to enter individual enterprise, to risk one's own capital, because the fruits of one's labor could not be enjoyed.” The right to property is the ultimate incentive for economic growth and prosperity. It gives people something to strive for in order to improve their circumstances. On the opposite end of the spectrum, “Socialism, reduced to its simplest legal and practical expression, means the complete discarding of the institution of private property by transforming it into public property and the division of the resultant income equally and indiscriminately among the entire population." (Encyclopedia Britannica, 1946 ed., Vol. 20, p. 895.)

This system would not be conducive to economic growth in the least because it eliminates all incentive to better one’s situation. When property rights are fully given it is a cycle that is beneficial to all. As President Benson states in the reading, “Profit creates wealth; wealth creates more work opportunity; and more work opportunity creates greater wealth.”

If I wanted to make a city with economic opportunity and success, it would be a free market system. Its tenets would be the rights to life, liberty and property. This would ensure a competitive and healthy economic system as opposed to an unhealthy, government planned economy.