Free Equitism: A New Approach to Freedom and Equality
Economic inequality is one of the most pressing challenges of our time. The gap between the rich and the poor has been widening in many countries, leading to social unrest, political polarization, and human suffering. How can we address this problem without sacrificing economic efficiency, innovation, and growth?
One possible answer is free equitism, a philosophy that aims to balance the goals of equality and freedom in a comprehensive system. Free equitists believe that efficient markets maximize the wealth available to society, and that freedom in all its forms should be maximized while reducing inequality as much as possible without creating dead weight loss. This notion of freedom also recognizes that true freedom encompasses not just economic freedom, but also personal liberties like free speech and human rights.
The Two Pillars of Free Equitism
1. Maximizing Freedom Through Market Repair
Market failures are situations where free exchange fails to allocate resources efficiently. These arise from:
- Negative externalities (like pollution)
- Monopoly power
- Non-excludable goods (public and common goods)
- Asymmetric information
Free equitists argue that addressing these failures actually makes markets more free by enabling efficient voluntary exchange. They support:
- Carbon taxes to internalize environmental costs
- Antitrust laws to prevent monopolistic restrictions on trade
- Public funding for non-excludable goods
- Regulation of information asymmetries
Importantly, this isn’t anti-freedom — it’s pro-freedom. Well-designed regulation enables rather than restricts free exchange.
2. Redistributing Without Deadweight Loss
Free equitists recognize that even perfectly efficient markets may produce unfair outcomes due to luck, inheritance, or different individual needs. However, they insist on addressing this through methods that don’t create economic distortions:
Preferred Tools:
- Taxes with negative deadweight loss (like carbon taxes)
- Taxes with neutral deadweight loss (like land value taxes)
- Universal basic income (which doesn’t distort market incentives)
Avoided Tools:
- Income taxes (distort labor markets)
- Sales taxes (distort consumption)
- Wealth taxes (distort investment)
The ideal implementation is a social state funded entirely by efficient taxes, distributing resources primarily through universal basic income (UBI). The only exception is funding for non-excludable goods like national defense that can’t be efficiently provided through private markets.
Beyond Markets: The Full Scope of Freedom
A truly free society requires:
- Free speech protection
- Human rights guarantees
- Personal autonomy
- Democratic governance
- Rule of law
These freedoms reinforce economic freedom — markets function best in societies with strong institutions and personal liberties.
Why Price Controls Fail
Some advocate for direct interventions like minimum wages or rent control to address inequality. Free equitists oppose these because they create deadweight loss — they prevent mutually beneficial transactions from occurring.
For example:
- Minimum wages may help some workers but create unemployment for others
- Rent control may help some tenants but reduces housing supply and quality
Instead of distorting prices, free equitists advocate addressing inequality through efficient taxation and direct cash transfers.
Conclusion
Free equitism offers a comprehensive framework for maximizing both freedom and equality. By addressing market failures systematically, using efficient redistribution methods, and protecting personal liberties, we can build a society that is both more free and more equal.
This isn’t just theory — it provides clear guidance for policy:
- Replace distortionary taxes with efficient ones
- Fund a UBI through these efficient revenue sources
- Address market failures systematically
- Protect personal freedoms vigorously
In doing so, we can achieve what many consider impossible: reducing inequality while enhancing rather than restricting freedom.
