On July 31, we will commemorate the birthday of Milton Friedman, an influential advocate for capitalism and freedom. It is fitting to honor him during the same month we celebrate the Declaration of Independence, as both occasions remind us of the crucial importance of safeguarding these essential pillars of open societies as we enter national election cycles.
In his 1962 book, “Capitalism and Freedom,” Friedman stated, “Because we live in a largely free society, we tend to forget how limited is the span of time and the part of the globe for which there has ever been anything like political freedom: the typical state of mankind is tyranny, servitude, and misery.”
This connection between freedom and capitalism is deeply intertwined with the origins of the United States itself. Notably, half of the original signers of the Declaration of Independence were leaders in commerce at the time—planters, shippers, and merchants. Despite grave risks, these brave individuals affixed their signatures, believing they must preserve freedom for future generations. Their act of signing the Declaration was a resolute response to the arbitrary nature of laws and a commitment to maintaining an unfettered trade environment from which they and their communities would benefit.
When Ronald Reagan assumed office in 1980, nearly 40% of the world’s population lived under communist rule. However, following the collapse of the Soviet Union in 1990, that number decreased to 20% or less, leading to the most significant expansion of global commerce in history. The Spirit of ’76 swept the globe as newly elected governments and independent judiciaries were established, heavily influenced by US law and political theory.
This correlation between political freedom, the free market, and the development of capitalist institutions became evident. Capitalism provided more people with economic autonomy, empowering them to pursue personal goals, engage in voluntary transactions, and reap the rewards of their labor. It fostered competition, encouraged innovation, and generated prosperity, elevating societies and improving the lives of countless individuals.
Capitalism’s impact on prosperity is evident when we examine data from the Federal Reserve, which shows that the total net worth of U.S. households grew from $24.3 trillion in 1989 to $149 trillion in 2023. Additionally, according to the World Bank, since 1990, trade has increased global incomes by 24%, with the poorest 40% of the population experiencing a 50% increase.
Nevertheless, the world faces new challenges that jeopardize these gains. Access to vital commodities such as gas, wheat, and critical minerals is at risk.
With the Russian invasion of Ukraine and China’s threats against the democratically elected Taiwanese government, conversations of decoupling economic ties with China and Russia dominate the boardrooms and multilateral talks. Europe reduced its dependence on Russian oil and gas by 40% after the Russian invasion of Ukraine. The US Federal Bureau of Investigation (the FBI) warns of the grave danger posed by the counterintelligence and economic espionage efforts of the Chinese government and Communist Party to the economic well-being and democratic values of the United States.
As authoritarian regimes rise, Individual freedom is threatened. After the fall of Kabul, Afghan girls lost the ability to leave their homes or attend school. Uyghur women suffer sexual abuse and torture in Chinese concentration camps. And in March, four Belarussian women political scientists and journalists received decade-long prison sentences for speaking out against the government.
Fear and anxiety are rising. Geopolitical unrest and economic challenge dominate boardrooms and corporations are restructuring to adapt.
As democratic nations go to the polls, we must safeguard capitalism and freedom. While these principles have proven to be transformative forces for human progress, they are not immune to threats. Our collective responsibility is to protect and nurture these ideals, fostering an environment that promotes entrepreneurship, defends individual liberties, and ensures equal opportunities for all members of society.
In doing so, we honor the vision of the U.S. founding fathers, the legacy of Milton Friedman, and the countless individuals who have fought and sacrificed to preserve the freedoms we enjoy today. Let us champion capitalism and freedom as indispensable pillars of a just and prosperous society, fostering a future where liberty and opportunity flourish for future generations.
Written by Lisa Gable.
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