The Morality of Markets

My recent column “From Whence Comes Income” sparked considerable favorable reader response, not to mention thoughtful reader correction of my grammar error in the title: “From Whence” is redundant. Quite a few readers were a bit confused about my assertion that market allocation of goods and services are infinitely more moral than the alternative.

The first principle of a free society is that each person owns himself. You are your private property, and I am mine. Most Americans probably accept that first principle. Those who disagree are obliged to inform the rest of us just who owns us, at least here on earth.

This vision of self-ownership is one of those “self-evident” truths to which the Founders referred to in the Declaration of Independence, that “All Men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty, and the Pursuit of Happiness.” Like John Locke and other philosophers who influenced them, the Founders saw these rights as preceding government, and they said, “That to secure these Rights, Governments are instituted.”

The Framers of the Constitution recognized that while government was necessary to secure liberty, it was also liberty’s greatest threat. Having this deep suspicion of government, they loaded our Constitution with a host of anti-congressional phrases, such as: “Congress shall make no law,” “shall not be infringed” and “shall not be violated.”

Once one accepts the principle of self-ownership, what’s moral and immoral becomes self-evident. Murder is immoral because it violates private property. Rape and theft are also immoral — they also violate private property.

Here’s an important question: Would rape become morally acceptable if Congress passed a law legalizing it? You say: “What’s wrong with you, Williams? Rape is immoral plain and simple, no matter what Congress says or does!”

If you take that position, isn’t it just as immoral when Congress legalizes the taking of one person’s earnings to give to another? Surely if a private person took money from one person and gave it to another, we’d deem it theft and, as such, immoral. Does the same act become moral when Congress takes people’s money to give to farmers, airline companies or an impoverished family? No, it’s still theft, but with an important difference: It’s legal, and participants aren’t jailed.

Market allocation of goods and services depends upon peaceable, voluntary exchange. Under such exchanges, the essence of our proposition to our fellow man is: If you do something I like, I’ll do something you like. When such a deal is struck, both parties are better off in their own estimation.

Billions of these propositions are routinely made and carried out each day. For example, take my trip to the grocery store. My proposition to the grocer is, essentially: “If you make me feel good by giving me that gallon of milk you own, I’ll make you feel good by giving you three dollars that I own.” If my proposition is accepted, the grocer is better off, since he values the $3 more than the milk and I’m better off, since I value the milk more than the $3.

Contrast the morality of market exchange with its alternative. I might go to my grocer with a pistol and propose: give me a gallon of milk or I’ll shoot you. Or, I might lobby Congress to take his milk and give it to me. Either way I’m better off but the grocer is worse off.

Lest there’s misunderstanding, there are legitimate and moral functions of government, namely that of preventing the initiation of force, fraud and intimidation, and we’re all duty-bound to cough up our share of the cost. All other matters in our lives should be left to civil society and its institutions.