Freedom is diminishing in countries where governments continue to promote “fairness,” driven by the goal of equal economic outcomes for all citizens. “Fairness” is pursued through equity: taking from those who have produced more and giving it those who have produced less or nothing. Or, in the words of Karl Marx: “From each according to his ability, to each according to his need.”
Canada is at the forefront of this equity agenda. In defending the recently released 2024 federal budget – dubbed the “fairness” budget by the media, Finance Minister Chrystia Freeland said: “I think it’s entirely appropriate, it’s really fair, to ask those who are doing the best in society to pay a little bit more.” Those “doing the best” include small business owners and professional corporations (such as those owned by family physicians) whose retirement income the proposed budget would jeopardize.
The federal budget with its increase of capital gains taxes is only the latest addition to the government’s fairness agenda. It follows, among other initiatives, subsidies to low-cost housing, rent controls, “free” pharmacare, and threats to increase taxes to grocery stores (that already operate with razor-thin margins) unless they lower food prices.
If you find the government “fairness” initiatives appealing, you may ask why such initiatives erode freedom and why that matters. While these initiatives (whether taxes, subsidies, or regulations) may provide “free access to goods” to their recipients, they violate the freedom of the most productive – from Elon Musk and Jeff Bezos to every other creative entrepreneur – by coercing them to give up their hard-earned wealth, penalizing and preventing their productivity and investments – both of which are necessary for overall economic growth, prosperity, and wellbeing.
Freedom means the absence of physical coercion so that we can do what our survival and thriving requires: think and produce. If the government (or a criminal) steals your money or dictates what you must do at the threat of penalty for non-compliance, your ability to produce is severely diminished or destroyed. You may be able to plan what and how to produce but not to carry out your plans. The government calls its initiation of physical force “fairness,” but such a violation of freedom of the producers is unjust and does not make anyone better off, despite politicians’ claims. It harms, not only the producers, but everyone.
Canada is a clear illustration. Under the current government since 2015 economic freedom has declined. Investment has been fleeing the country, weakening the dollar, and increasing inflation. Consequently, productivity and economic growth have stagnated and job growth has stalled, keeping wages low and prices high. Not only investments but skilled workers are leaving Canada, most of them for the United Sates, where salaries are much higher (46% higher in the technology sector, according to a recent survey) and taxes lower. Those departing increasingly include recent immigrants disillusioned by the high cost of living, limited job opportunities, and comparatively low salaries.
Contrast this to the progress and growing prosperity in the economically freest countries of the world, such as Singapore, Switzerland, and Ireland. Investors are attracted to these jurisdictions by profit opportunities, lower taxes, and the relative absence of state control of the economy. They will invest in the development of new, innovative products and technologies, confident that their risk taking is rewarded by success in the market and their profits not punitively taxed to fund “fairness” schemes. More investment and better performance both in product and stock markets means more jobs, better and less expensive products, and increased prosperity and a higher standard of living for everyone.
If we want to survive and thrive, we need freedom, not “fairness.”
Despite what the political leaders in Canada and elsewhere think, the government’s task is not to ensure “fairness” but to protect freedom, governed by the principle of individual rights to life, liberty, property, and the pursuit of happiness. This means the government leaving us alone to produce, trade freely with others, and to prosper while protecting us from those who initiate, or threaten to initiate, physical force or fraud. A proper government has only one function: the protection of individual rights. Instead of initiating physical force through taxation, regulations, and forced subsidies, a rights-protecting government sets objective laws and enforces them through the police, the law courts, and the military.
If we want to defend freedom, we must oppose “fairness” initiatives and hold the government accountable for protecting individual rights, using whatever channels are available, such as social media or our political representatives. And we should do so while we still have free speech that makes criticizing the government and stopping the erosion of freedom possible.
