One of the most striking theories that the famous libertarian economist Milton Friedman put forth in his book
Capitalism And Freedom was that economic freedom (a market free from government intervention) is a necessary pre-condition for political and civil freedoms. This notion became a sort of mantra for the neoliberal era, where deregulation and privatization were thought of as the panaceas to all troubles in the world. In many formerly communist states, like Russia, aggressive privatization policies were enacted, and national industries were sold off at discounted prices to a few lucky individuals, while in other states that had had social democratic economies, like the United Kingdom, aggressive deregulation and privatization policies dismantled the mixed economies.
There is little evidence that privatization and deregulation policies increased the freedom of citizens in these countries, but they certainly contributed to increased inequality. In Russia, it basically took authoritarian rule to enact the extreme privatization, and today Russia can hardly be called free, economically or politically. In other cases, economic freedom has been implemented, without any sign of real political freedom.
Singapore is a good case study for this. The small island, situated right off the southern tip of Malaysia, is well known for its economic freedom, and is ranked number two out of 178 countries on the Heritage Foundation’s 2015 index of economic freedom. Tax rates are low, with the top individual income tax at 20 percent and the top corporate tax at 17 percent, there is no minimum wage, the average tariff rate is zero, and starting a business takes an average of just three days. It is, by all means, a wonderful place to be a business person, and the economy is very strong. Unemployment is at a low 3.1 percent, and it has an outstanding per capita GDP of $64,584, which is superior to the United States. It also has a highly educated workforce and a low rate of corruption.
It sounds almost utopian to free market advocates; surely a place where economic freedom is so great, political freedom must also flourish, according to the theory that economic freedom is the precondition for political. Yet, when you look at the World Press Freedom Index, which ranks countries by their freedom of press and information, Singapore was ranked an unfavorable 150 out of 180 countries, behind the likes of Russia, Libya, and Afghanistan. The government strongly regulates the press and limits the circulation of foreign newspapers if they “engage in the domestic politics of Singapore.” They also require news websites of a certain size (50,000 unique Singapore users per month) to purchase a $50,000 (singapore dollars) bond, and if they publish “prohibited content,” they must either remove the content or forfeit the bond.
This lack of freedom also exists with freedom of expression, peaceful assembly, and association, where they are limited for security, public order, and morality reasons. The government, run by the single party Peoples Action Party (PAP) since 1965, regularly sues for defamation when someone criticizes them. This has happened multiple times to one of the leading critics of the PAP, Chee Soon Juan, who is the leader of the Singapore Democratic Party (SDP). In 2001, Juan was sued by the Prime Minister and former Prime Minister, and was ultimately forced to declare bankruptcy, which made him ineligible to run for election.
Other areas of society are seemingly authoritarian. In the criminal justice system, under the Internal Security Act (ISA), authorities can arrest and detain suspects for unlimited periods without charging them, while certain punishments are harshly draconian, including the death penalty for trafficking drugs, and the criminal ban on homosexuality.
Clearly, Singapore is lacking in certain fundamental freedoms, though not economic ones. This has lead some to label Singapore’s political system “authoritarian capitalism.” This system does seem to prove that economic freedoms and political freedoms are separable, and that one does not necessarily cause the other. A country like Norway is ranked at 27 on the economic freedom index, yet its citizens have complete freedom of speech and expression, and have since 1814. When a country has a constitution guaranteeing certain freedoms, those can not be infringed upon, unless a new government overrules them. Norway is a social democracy, with state ownership in key industries and robust welfare programs, which obviously limit economic freedom. But one would have to be rather dogmatic to claim that Singapore is a freer country than Norway because of its economic freedoms.
In some cases, economic and political freedoms can even conflict with each other. This happened in 1970’s Chile, when dictator Augusto Pinochet enacted free market policies with authoritarian rule, after much protest from citizens. It is no small coincidence that Milton Friedman advised Pinochet on his economic policies, and seemed to believe Chile was a success, even though Pinochet’s regime executed and disappeared thousandsof citizens opposed to free market reform.
The notion that economic freedoms are more important than political ones is a nice idea for wealthy business people and corporations, but in reality, a completely free market does not guarantee political freedom, though it does tend to produce extreme inequality. One area that Singapore also flourishes in is inequality. In 2012, the small city-state had greater income inequality than all of the OECD nations, including the notoriously unequal United States. This isn't surprising, as stated before, Singapore does not have a minimum wage, and there is little regulation.
The neoliberal ideology has always declared that economic freedom is crucial for political freedom, but the facts simply do not back up this assumption. Over the past three decades, many countries, including Singapore, have embraced free markets with little regulations. In some cases, quasi-authoritarian governments were needed to enact the rapid free market reforms, revealing how little civil freedom means to the movement. Singapore reveals how wrong Milton Friedman's assumption really was. Over the years, greater civil liberties have been achieved through mass movements and activism, not the freedom of businesses to do as they please.