'Left-behind' got it wrong

THE EDITOR: Friday's Newsday editorial headlined “The Left-behind,” blamed the free market for the penurious state of Joel Julien, who had been awarded a Hummingbird Medal (Bronze) for gallantry.

“The upsurge in crime, the rise of the criminal gang in areas associated with lower incomes, the breakdown in social mobility – all, some would say, are a result of the failure of the marketplace to address these inequities,” the editorial asserts.

But this is the reverse of the truth. The communities in which crime rates are highest are exactly those where the free market operates least and where State involvement is highest (in respect to make-work programmes, which are essentially wealth transfers from taxpayers with no returns on productivity).

It is also the State-mandated policy of the minimum wage which prevents individuals like Mr Julien from getting work, since economists have long proven through studies in many countries (including TT) that the minimum wage results in higher unemployment for the least-skilled persons. This happens because the Minimum Wage Act is in essence a law which makes it illegal for lower-skilled people to offer their labour at a cheaper price so employers will hire them.

The editorial also references goods “that the free market cannot be relied on to supply. This is why healthcare and education are key matters for the State.” But the dire shortcomings of these sectors are precisely the result of State domination, nor is there any absolute reason why the market cannot supply these goods (which in fact happens since private hospitals and private schools do exist).

Should these sectors be totally privatised, this would foster competition which would ensure better service while keeping prices down.

Elton Singh, Couva