After this morning’s advice bureau, I had the pleasure of visiting Windsor Conservative Association Women’s Group, where I explained what I think are the long term causes of this crisis and what we should do about it. Here are the slides:
As we were mostly discussing the problems of state-direction in the economy, I have a good excuse to quote this section on free enterprise:
This idea of an economy which largely ran itself, without the supervision of a centralised government, in time transformed economic thinking in the West. [Adam] Smith’s new theory challenged the economic practice of the day — a system of mercantilism by which monarchs and ministers closely directed the economy. The old economic order was based on the idea that the source of a nation’s wealth lay in its stock of gold, silver and precious metals. Commerce was thought best conducted by granting monopolies to guilds and corporations. Laws were passed to suppress wages and keep prices high, and a complex web of high taxes and duties were levied to finance the military adventurism which governments pursued to plunder the resources of other nations, and enslave their people. Smith turned these ideas on their head, demonstrating that the wealth of nations was derived from a division of labour which allowed people to specialise at providing the consumer with what he wanted. Money, he argued, was only of value in terms of what it could buy. Competition increased purchasing power and therefore created prosperity.
I thoroughly recommend the book and I am most grateful to Windsor Conservative Association Women’s Group for having me along.