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When a leftist tells you something along the lines of "remember, the economy exists in order to benefit the people - not the other way around," you should think: Hello!? What is an economy, but many millions of people interacting daily?

At Liberty and Prosperity, we certainly agree with the notion that the economy should serve to benefit its people. However, such a retort suggests that non-leftists, such as those in favour of capitalism, do not support this notion. Nonsense! The fact is, capitalism does support this notion, and this notion is supported by freer markets.

Free markets improve the ability of economies to serve society. In fact, it is typical high-spending socialism which merely tries to prop up the economy, rather than to serve society. When the government spends a lot of money, first year macroeconomics suggests that such spending is good for the economy. However, one must remember that government spending is also funded by some kind of taxation. That is, when the government spends our money on things that we may not even want, on behalf of us, there is an opportunity cost.

Economies are much better stimulated by lowering taxes (and to keep a balanced budget, lowering government spending). Let the people spend their own money, because they use it the best, and that, in turn, helps the economy provide the most useful services to society. After all, the economy is supposed to serve society, not the other way around, isn't it?