Libertarians often equate capitalism with the absence of restrictions on freedom. Anthony Flew, for example, defines libertarianism as ‘opposed to any social and legal constraints on individual freedom’. He contrasts this with liberal egalitarians and socialists who favour government restrictions on the free market. Flew thus identifies capitalism with the absence of restrictions on freedom. Many of those who favour constraining the market agree that they are thereby restricting liberty. Their endorsement of welfare-state capitalism is said to be a compromise between freedom and equality, where freedom is understood as the free market, and equality as welfare-state restrictions on the market. This equation of capitalism and freedom is part of the everyday picture of the political landscape.

Does the free market involve more freedom? It depends on how we define freedom. Flew seems to be assuming a neutral definition of freedom. By eliminating welfare-state redistribution, the free market eliminates some legal constraints on the disposal of one’s resources, and thereby creates some neutral freedoms. For example, if government funds a welfare programme by an 80-per-cent tax on inheritance and capital gains, then it prevents people from giving their property to others. Flew does not tell us how much neutral freedom would be gained by removing this tax, but it clearly would allow someone to act in a way they otherwise could not. This expansion of neutral freedom is the most obvious sense in which capitalism increases freedom, but many of these neutral freedoms will also be valuable purposive freedoms, for there are important reasons why people might give their property to others. So capitalism does provide certain neutral and purposive freedoms unavailable under the welfare state.

But we need to be more specific about this increased liberty. Every claim about freedom, to be meaningful, must have a triadic structure-it must be of the form ‘x is free from y to do z’, where x I specifies the agent, y specifies the preventing conditions, and z specifies the action. Every freedom claim must have these three elements: it must specify who is free to do what from what obstacle. Flew has told us the last two elements––æhis claim concerns the freedom to dispose of property without legal constraint. But he has not told us the first-i.e. who has this freedom? As soon as we ask that question, Flew’s equation of capitalism with freedom is undermined. For it is the owners of the resource who are made free to dispose of it, while non-owners are deprived of that freedom. Suppose that a large estate you would have inherited (in the absence of an inheritance tax) now becomes a public park, or a low-income housing project (as a result of the tax). The inheritance tax does not eliminate the freedom to use the property, rather it redistributes that freedom. If you inherit the estate, then you are free to dispose of it as you see fit, but if I use your backyard for my picnic or garden without your permission, then I am breaking the law, and the government will intervene and coercively deprive me of the freedom to continue. On the other hand, my freedom to use and enjoy the property is increased when the welfare state taxes your inheritance to provide me with affordable housing, or a public park. So the free market legally restrains my freedom, while the welfare state increases it. Again, this is most obvious on a neutral definition of freedom, but many of the neutral freedoms I gain from the inheritance tax are also important purposive ones.

Will Kymlicka, Contemporary Political Philosophy: An Introduction, Oxford, 1990, pp. 146-147