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Dr. Milton Friedman, Nobel Laureate:

Post-Communist Eastern Europe, The Rule of Law, Protection of Property Rights and Privatization

 

FREEDOM WITH JUSTICE AND SECURITY: THE CHALLENGE OF THE TWENTY-FIRST CENTURY

Lady Thatcher's speech delivered in Zagreb, Croatia, September 16, 1998.

 

Brief Excerpt:

But let me insist on an important point. The difference between the collectivist, state-planned system and the liberal, free enterprise one is not just a matter of economics. It's also a matter of power. The free market disperses power throughout society - it's a kind of "economic democracy" - whereas socialism in all its forms concentrates power at the centre.

Nor is free enterprise capitalism a free-for-all. This is not always fully understood in countries which are trying to make the difficult transition from socialism to capitalism. A properly functioning market economy must always be governed by clear rules of competition and there must be effective safeguards for investors. Capitalism cannot, in fact, operate without a strong administration to police the laws that provide its framework. And it cannot succeed without honesty. Racketeers, blackmarketeers and smugglers are not entrepreneurs - they are just plain criminals. Corruption and gangsterism are scourges which afflict many newly developing economies and states. They should be ruthlessly and fearlessly expunged. Otherwise not just the free market but freedom itself is in peril.

These observations also highlight the fact that the system of freedom and free enterprise is, above all, based on the rule of law - law which must be fair, clear, and honestly administered, and to which government, and all those associated with it, are also subject like everyone else.

Such is the political and economic system for which we should aim. Wherever it is tried it is successful. And if it had been achieved in earlier decades the world would be more peaceful and prosperous today.