Economic freedom is usually discussed in terms of government policy and market dynamics, so it can be easy to lose sight of the individual stories at the heart of every economy — the people buying and selling in countless voluntary transactions, each trying to improve their lives by providing something of value to others. That human face of economic freedom was the focus of a recent presentation in Cape Town, South Africa, by Temba Nolutshungu, a director of Atlas Network partner the Free Market Foundation.
“[Nolutshungu] explained how the lack of economic freedom in South Africa was crippling the economy, asking the audience to imagine Johannesburg, Cape Town and Durban without any commerce or industry, its citizens sitting around unable to earn money,” reported Atlas Network partner Ineng. “This was the reality for the above 35% of South Africans who find themselves unemployed. He also pointed out that 70% of the unemployed were under the age of 35, and that all their energy was going to waste, as they were not building skills, knowledge or experience to help them earn a living. Nolutshungu stated that South Africa could be seen as fertile ground for a revolution, and that the young, frustrated, desperate energy of the millions of young people unemployed was being vented in increasing protests.”
Nolutshungu spoke how even in communist countries, the power of market transactions makes all the difference in lifting people out of poverty. When people in the former Soviet Union established black markets that bypassed official government channels, they “operated their businesses naturally and automatically on the basis of market principles, such as the law of supply and demand,” the Ineng report points out. Similarly, market reforms in China during the 1980s “ushered in the greatest economic growth wave ever seen, as millions of Chinese citizens were able to lift themselves out of poverty.”
The event touched on the “Economic Freedom of the World: 2015 Annual Report,” published by Canada-based Atlas Network partner the Fraser Institute, in which South Africa places 96th out of 157 nations. That’s not nearly as bad as the situation in authoritarian regimes like Venezuela or the Republic of Congo, but there is vast room for improvement, especially in the size of government, rates of taxation, and secure property rights.
Nolutshungu concluded with this quote from Nelson Mandela speaking at the Johns Hopkins Symposium, on Nov. 12, 2003: “As I moved around the world and heard the opinions of leading business people and economists about how to grow an economy, I was persuaded and convinced about the free market. The question is how we match those demands of the free market with the burning social issues of the world.”
Read the Ineng report, “Economic Freedom of the World in 2015.”