Ronald Reagan on free enterprise
Religion & Liberty Online

Ronald Reagan on free enterprise

When I lived in Egypt one of the Egyptian drivers for diplomats at the American Embassy in Cairo explained how people had to wait five to seven years for a phone. He proudly stated he was on the list, but poked fun at the long wait for service. Of course, he also added that you might be able to speed the process up by a few months with bribes, or as it is more affectionately knows as in Egypt, “baksheesh.”

Ronald Reagan loved to tell jokes about the former Soviet Union, especially about the stark differences between the United States and Soviet economic systems. It was a tactic he often used to take the hard edge off his criticism of the Soviets, while still drawing sharp contrasts between the competing systems. It also deftly showed his solidarity or sympathy with the Russian people.

Often to the horror of some of his top foreign policy advisers, he loved delivering the jokes directly to Mikhail Gorbachev at summit meetings. Gorbachev would politely smile or sometimes counter by adding that the joke was just a caricature of the Soviet system. But Reagan had carefully collected many of the jokes from former citizens of the Soviet Union, diplomatic officials, and some of them were passed to him by the CIA. Many of them were real jokes that had circulated inside the Soviet Union.

Many of Reagan’s jokes were a critique of the insufficiency of the Soviet system.

A Russian man goes to the official agency, puts down his money and is told that he can obtain delivery of his automobile in exactly 10 years. “Morning or afternoon,” the purchaser asks. “Ten years from now, what difference does it make?” replies the clerk. “Well,” says the car-buyer, “the plumber’s coming in the morning.”

Another joke Reagan liked to deliver summed up his thoughts well. Two Russians are walking down the street, and one says, “Comrade, have we reached the highest state of communism?” “Oh, no,” the other replies. “I think things are going to get a lot worse.”
Part of the reason Reagan’s jokes were effective is because they spoke the truth with humor. Perhaps unlike any other major 20th century politician he was able to make effective arguments for the free market, and in a persuasive manner. Why was this so? It’s not just that it was because most Americans agreed with him, and they certainly did. It was also because he spent years studying these issues, and his ideas were really his own ideas. Many people now know Reagan delivered over a thousand radio addresses from 1975 to 1979, and that he wrote most of the addresses himself. They know this partly because of the 2001 book, Reagan In His Own Hand: The Writings of Ronald Reagan That Reveal His Revolutionary Vision for America.

Here is an excerpt from a radio address by Reagan in April of 1979, specifically addressing the issue of the Free Enterprise system. It is reproduced as he wrote it.

It isn’t unfair to say that today the world is divided between those who believe in the free mkt. place & those who believe in govt. control & ownership of the economy.

I’ll be right back.

Our free mkt. system is usually termed capitalism and by that definition capitalism has hardly been around long enough to deserve all the evil for which it is being held responsible.

Most of us aren’t really conscious of how recently the capitalist system came into being. Possibly we look back & think of the extravagant luxury of kings & emperors & see that as capitalism. We have a modern counterpart today in the rulers of Marxist nations. The ruling hierarchy of the Soviet U. live on a scale more akin to royalty than do the heads of capitalist countries.

Maybe our trouble is caused by the term capitalist itself. Actually all systems are capitalist. It’s just a matter of who owns & controls the capital–ancient king, dictator or private individual. We should properly be looking at the contrast between a free mkt. system where individuals have the right to live like kings if they have the ability to earn that right and govt. control of the mkt. system such as we find today in socialist nations.

We have a very visible example of the contrast between the free mkt. & govt. ownership in a household necessity we take for granted. The invention of Alexander Graham Bell–the telephone offers us irrefutable proof of the superiority of the free mkt.

As recently as 1880 there were only 34,000 miles of telephone wires on the whole N. American Continent. There were dozens & dozens of small telephone companies using several different kinds of equipment and there was no inter-connection between these different companies. The same situation prevailed in all the other so called advanced nations.

If someone had openly advanced a plan to put a phone in every home, on every farm, in every hamlet & city and hook them all together I’m sure someone would have said, “only govt. has the resources to do that.”

Now strangely enough in most other countries govt. did take over the telephone system and to this very day the telephones in a great many countries are part of the postal system. In America the govt. wasn’t bulldozing it’s way into the free mkt. place as it is today. For that we can be grateful. The scattered, competing phone companies were left to the magic of the mkt. place. And that magic worked as it always does.

We take the phone so much for granted it’s hard to realize things weren’t always this way. We can dial directly to any point in the country and to a great many outside the country.

With no intention of insulting anyone it I have to say it only takes a few days trip in many of those other countries to where the telephone is a govt. service to realize there is a difference. A long distance call there can be quite an adventure–so can getting a phone installed.

But here we have them in our cars if we like, in private or corporation owned executive planes & on boats. We bounce long distance calls off privately owned satellites and use telephone lines for network radio & remote broadcasts of sporting & special events.

And all of this came about because private individuals wanting to make a profit for themselves kept thinking of better services to offer, confident that we’d want that better service.

This is RR Thanks for listening.

Reagan in His own Hand, The Free Press p. 228,229.

Ray Nothstine

Ray Nothstine is editor at the Civitas Institute in Raleigh, North Carolina. Previously, he was managing editor of Acton Institute's Religion & Liberty quarterly. In 2005 Ray graduated with a Master of Divinity (M.Div) degree from Asbury Theological Seminary in Wilmore, Ky. He also holds a B.A. in Political Science from The University of Mississippi in Oxford.