Overview

• Free trade is the best way to maximise prosperity.
• Free trade is also effective in incentivising peace between nations.
• Pollution is a breach of the Legal Principle.
• State-funded services are never free - they are paid for by inflating the currency and taxation, both of which breach the Legal Principle.

The power of businesses competing to serve us

• Like any monopoly, when the state is the only provider of a service, the lack of alternative choices means less incentive to compete to attract customers. Competition naturally results in businesses offering higher quality services at lower costs, otherwise they lose out to more attractive offerings. The result is ever improving value for money.

  Example of the iPhone

  • When the first iPhone was produced in 2007, Apple sold it for $599 with 8GB of storage. A new iPhone 13 can be bought in 2024 for the same price ($599) but comes with 16X more storage, 2X longer battery life, 6X more mega-pixels in the camera and many more improvements. When adjusted for inflation the superior iPhone 13 is 40% cheaper too! Apple had to offer improvements to quality and cost given the strong competition from Samsung, Google, Huawei and others. These rapid improvements that we consumers benefitted from required no intervention via government.

  Example of the Healthcare, where regulations are high

  • Meanwhile, have we seen a 40% improvement in healthcare costs with radically improved service? Unfortunately not. Healthcare costs in the US are 60% higher and the service improvements are less pronounced.

‘Free things’ vs ‘free choice’

• State-provided services are never ‘free’
• State-funded services, like healthcare, are paid for by people, even if those services cost nothing at the point of consumption. In healthcare, as for any business, money builds sufficient trust to motivate professionals to assist complete strangers. One way or another, caregiver salaries, medicines etc. need to be paid for, assuming patients continue to seek quality care. We, the citizens of that society, pay via taxes, inflation and reduced competition. As with most such methods requiring coercion, there are unintended (occasionally intended) sub-optimal consequences.

Pollution not tolerated in a truly free market

• The ‘free market’ is often criticised for its detrimental impact on the planet. But the 3L Philosophy does not tolerate aggressing in the form of polluting other people’s property.
• Therefore, a free society, one that adheres to the 3L Philosophy, must not pollute. This may add to the costs of some goods and services, but we can never make an exception to the Legal Principle without compromising its integrity.

Conclusion

• We can confidently say that services provided by the state monopoly are much more expensive than those provided by the ‘free-choice’ economy.
• Standards of living rise in a free society due to people being free to pursue win/win outcomes.