Don’t Give Up on the Free Market

Originally published at the Kansas Policy Institute.

If capitalism is working, why do so many young Americans feel like they are falling behind?

This is a question that Vice President J.D. Vance and others have been asking with increasing frequency in recent years.

Homes are expensive. Starting a family feels harder. Government debt is soaring. Too many young Americans are attracted to socialism. Their frustrations are real, even though socialism remains, as he rightly called it, “dangerous and destructive.”

His broader point deserves attention. VP Vance said, “You don’t stop socialism by throwing slogans at people about the free market. As much as I love the free market, you stop socialism by making people’s lives better, and that’s what we’re trying to do every single day.”

He is right about the goal. Free markets are not merely a slogan. Economic freedom is one of the most powerful forces that has proven to improve people’s lives.

Look at where Americans struggle most. Governments restrict housing supply through zoning, permitting delays, minimum lot sizes, fees, and other rules. Washington subsidizes housing demand. Prices rise, and capitalism gets blamed.

Healthcare hardly resembles a competitive market. Subsidies, mandates, licensing restrictions, tax preferences, and third-party payments separate patients from prices. Higher education combines federal subsidies, accreditation barriers, and easy student lending.

Government distorts markets, then markets take the blame.

Some talking heads believe that maximizing GDP should define economic success. It can, but it does not tell the full story. GDP measures production. It cannot measure faith, family, community, happiness, or human flourishing.

But economic freedom is not about maximizing GDP. As Cato economist Ryan Bourne recently explained, markets allow millions of people to make their own choices about working, saving, investing, consuming, and raising families. GDP often reflects those choices. It should not dictate them.

The results speak loudly.

The World Bank’s latest estimates show that about 1.5 billion people escaped extreme poverty from 1990 to 2022, an era marked by expanding trade, entrepreneurship, private investment, and market participation.

The Fraser Institute’s latest Economic Freedom of the World report finds that average incomes in the freest quarter of countries are 6.2 times those in the least free quarter. Even more important, incomes among the poorest 10% are 7.8 times higher, while people live about 17 years longer.

Freedom works especially well for people with the least.

The same lesson appears across America. The Fraser Institute’s latest Economic Freedom of North America report finds that from 2014 to 2023, population in the freest U.S. states grew nearly 18 times faster than in the least-free states, while statewide personal income grew nine times faster.

Kansans should pay attention. The state has lagged many competitors over the long run in private-sector jobs, wages, economic growth, and domestic migration. More government direction is unlikely to reverse that record.

Free markets also do not mean corporate welfare, bailouts, protectionism, or regulatory favoritism. Those policies replace competition with political privilege. Milton Friedman understood the deeper point. Markets matter because voluntary exchange lets people pursue their own purposes rather than politicians choosing for them.

All Americans deserve more than slogans. Give them more choices by removing government barriers to housing, healthcare, energy, work, and entrepreneurship while restraining spending, taxes, regulation, and corporate welfare. Recognize the dignity of each Kansan, trust them to make decisions for their own lives, and have faith that human agency is the most powerful incentive of all. 

The free market does not promise a perfect life. It gives people the freedom and opportunity to build a better one.