Free markets are essential for freedom

Statistics show that across the nation 69 percent of students entering college believe socialism is a positive economic framework. By the time they graduate that number will have grown to 75 percent who view socialism positively. Perhaps our educational system needs to do a better job of educating students on the basic principles that drive our economy.  Many of those principles can be gleaned directly from the Scriptures, and at a time when the global economy is in shambles and there’s so much debate about fairness, appropriate compensation and government regulation, it is high time we took another look at those biblical lessons.

Consider the parable of the workers in the vineyard in Matthew 20:1-16. The owner hired workers at various times of the day and the workers all agreed to the conditions. But at the end of the day those who worked longest complained because everyone was paid the same. What are the lessons we can learn from this parable?

First, the employer negotiated the terms of employment with each worker individually. Both agreed on the wages and the work to be done. This establishes the right of the employer and the employee to make a contract without interference from others. Additionally, the agreement with each employee was independent from that of any other employee. It was an individual agreement only between the employer and that particular employee, irrespective of what any other worker was doing or receiving.  Christ states that the employer has the lawful right “to do what I wish with what is my own” regarding the wages he pays, so long as he keeps his side of the agreement. But James 5:1 warns that if an employer cheats an employee out of what he was promised, the Lord Himself will deal with the employer.

The fact that the 11th hour workers were paid a full day’s wages was due to the employer’s freedom to be generous and not based on any supposed “workers rights.” If the worker does not like the amount he has been offered, he does not have to take the job; he has the right to go down the road to a different vineyard and see if you can negotiate a different situation for better wages. If a worker has a skill, he has a right to sell it to the highest bidder.

All of these points are central tenets of what is called the free-market or free enterprise system which is the economic system set forth in numerous passages in the Bible. Throughout world history, the nations that have adopted this system have risen to prosperity, while those that embraced government-regulated economic systems (i.e. socialism and communism) have consistently become poorer.

By definition, a free market economic system is one in which “prices and wages are determined by unrestricted competition between businesses, without government regulation.” It is “an economic system that allows supply and demand to regulate prices, wages, etc., rather than government policy.”

In other words, the free market is regulated by the people and their choices, not by the government. Historically, including in America, the free market economic system has consistently produced the greatest levels of both prosperity and liberty.

Significantly, in 2008–2009 the U.S. government spent massive federal funds to bail out four industries hard hit during that particular economic downturn – insurance, real estate, banking and automobile. Significantly, those four industries were those most heavily regulated by the government, while industries that had operated under a full free market system did not need a bailout.

For the government to interfere in employer/employee contracts violates the biblical precepts set forth in Matthew 20. The employment agreement is a private contract, not a public one. As long as that contract does not violate the moral law of God (don’t murder, steal, engage in sexual immorality, etc.), it is outside the jurisdiction of the government. The government certainly has no right to tell an employer what to pay an employee, which would include minimum wage laws.

Again, the rhetorical question of the employer in Jesus’ parable rings true: “Is it not lawful for me to do what I wish with what is my own?”

 

Loren Lippincott represents Legislative District 34 in the Nebraska State Senate. Read his column in the Nance County Journal.