Poor people in America have cell phone, cars, apartments, food, alcohol, cigarettes, medical care, and free time. These people are “poor” for the first time throughout human history, because poor is a relative term, and they live next to people who have twice, 5 times, or a 100 times more stuff or better food etc. But what people seem to gloss over, is that the American market started out as probably one of the freest markets ever. And what it created was some of the lowest poverty in the history of the world.
To clearly distinguish it from crony capitalism, free market or laissez-faire capitalism removes entire populations from poverty. Indeed even having a sort-of capitalist economy in a few major worldwide superpowers has made poverty drop by 80% worldwide over the last 30 years. And the countries with the more free markets still have the least poverty yet! It makes sense when you think about it. When people can keep more of the products of their labor, they create more, and will trade this excess. All of society benefits because more is created. The Mises Institute has posted an article which supports this common sense with more data.
It is an obvious fact that severe poverty has disappeared in the most industrialized countries. Nations like the US, UK, Switzerland, and Japan industrialized within what were predominantlylaissez-faire free-market conditions. Even the so-called social democracies, like Sweden and Germany, developed in free-market conditions, and adopted extensive state welfare and regulatory programs only after achieving high levels of economic development and industrialization. World Bank data shows that there is inequality, but this inequality is between the free-market nations and the crony-capitalist and socialistic nations.…
The idea that domestic laissez-faire causes poverty is unfounded. It is a historical fact that India, China, and Kenya never tried capitalism, so this system was never given a chance to work….
There have been significant improvements in living conditions around the world over the past thirty years. The largest improvements in the poorest nations took place during the wave of globalization that took place twenty years ago, after the fall of the USSR. The collapse of the Soviet Union opened the door to unprecedented globalization of industry. What does real data tell us about poverty during this period? Per Capita GDP rose dramatically
Clearly we should be less worried about catering to special interests by pouring money (extracted from the working population by force) down the poverty hole. As wealth is created, it naturally finds its way into the hands of the poor, without having to be stolen: the act of stealing it reduces the entire amount of wealth available. So by allowing people control over the products of their own labor, we are actually helping the poor people by wealth diffusion, more than they would be helped by redistribution.