<picture style="max-width: 100%; height: auto">
<source
type="image/webp"
srcset="https://d2eehagpk5cl65.cloudfront.net/img/c2400x1350-w2400-q60/uploads/2023/10/img_1687_720.jpg.webp 2400w,https://d2eehagpk5cl65.cloudfront.net/img/c1200x675-w1200-q60/uploads/2023/10/img_1687_720-1200x675.jpg.webp 1200w,https://d2eehagpk5cl65.cloudfront.net/img/c800x450-w800-q60/uploads/2023/10/img_1687_720-800x450.jpg.webp 800w,https://d2eehagpk5cl65.cloudfront.net/img/c600x338-w600-q60/uploads/2023/10/img_1687_720-600x338.jpg.webp 600w,https://d2eehagpk5cl65.cloudfront.net/img/c331x186-w331-q60/uploads/2023/10/img_1687_720-331x186.jpg.webp 331w,https://d2eehagpk5cl65.cloudfront.net/img/c1200x675-w1200-q60/uploads/2023/10/img_1687_720-1200x675.jpg.webp 1200w,https://d2eehagpk5cl65.cloudfront.net/img/c1920x1080-w1920-q60/uploads/2023/10/img_1687_720.jpg.webp 1920w"
sizes="(min-width: 753px) 70vw, (min-width: 1190px) 768px, 100vw"
>
<source
type="image/jpeg"
srcset="https://d2eehagpk5cl65.cloudfront.net/img/c2400x1350-w2400-q60/uploads/2023/10/img_1687_720.jpg 2400w,https://d2eehagpk5cl65.cloudfront.net/img/c1200x675-w1200-q60/uploads/2023/10/img_1687_720-1200x675.jpg 1200w,https://d2eehagpk5cl65.cloudfront.net/img/c800x450-w800-q60/uploads/2023/10/img_1687_720-800x450.jpg 800w,https://d2eehagpk5cl65.cloudfront.net/img/c600x338-w600-q60/uploads/2023/10/img_1687_720-600x338.jpg 600w,https://d2eehagpk5cl65.cloudfront.net/img/c331x186-w331-q60/uploads/2023/10/img_1687_720-331x186.jpg 331w,https://d2eehagpk5cl65.cloudfront.net/img/c1200x675-w1200-q60/uploads/2023/10/img_1687_720-1200x675.jpg 1200w,https://d2eehagpk5cl65.cloudfront.net/img/c1920x1080-w1920-q60/uploads/2023/10/img_1687_720.jpg 1920w"
sizes="(min-width: 753px) 70vw, (min-width: 1190px) 768px, 100vw"
>

</picture>

Swedish historian Johan Norberg is author of The Capitalist Manifesto: Why the Global Free Market Will Save the World, which caught the eye of Elon Musk, who tweeted, "This book is an excellent explanation of why capitalism is not just successful, but morally right."

Norberg wrote the book to combat a growing belief on the right and the left that libertarian values of individual autonomy, property rights, limited government, and free enterprise are failing to raise living standards and need to be ditched in favor of more centralized power and control over virtually all aspects of our lives.

A senior fellow at the Cato Institute, Norberg shows that life is actually getting better for all of us—especially the world's poor—and that economic globalization, political liberalization, and cultural freedom are the main drivers of that improvement. He talks about how liberals and conservatives get the past wrong, why he's not worried about China's supposedly unstoppable economic growth, and why the cases for free trade, free expression, and more immigration need to be constantly updated and renewed. He also explains why he's a libertarian and not an anarchist. Reason's Nick Gillespie spoke to Norberg in Washington, D.C., in late September. 

Watch the full video here and find a condensed transcript below. 

Reason: Many Americans are saying, "Well, you know what? Since China joined the World Trade Organization in the 21st century, we have just seen massive deindustrialization. The Midwest is beyond the Rust Belt. Everything has gone to hell in the United States." That's not really true, right? 

Johan Norberg: The middle class is shrinking, but that's because it's moving up. If you look at those indicators, and specifically, if you look at not just dollars and cents. We should do that too because it is important to lay to rest the whole idea of wage stagnation, which was really a period in the 1970s and the 1980s when many sectors had increased wages much faster than productivity. They had to scale that back or they would've been destroyed completely.

After 1990, we've seen rapid wage increases in the U.S., 30 to 60 percent depending on whether you're taking full compensation, including nonmonetary like health insurance and stuff. Also, it's important to mention goods and services. It's not dollars and cents. We want to be able to buy something—most amenities that were considered luxuries just decades ago are now getting close to 100 percent distribution in the United States. People under the poverty threshold in the U.S. now have more amenities like T.V. sets, washing machines, dryers, and of course, computers and cellphones than the average American had in 1970.

It seems like not everything was destroyed. Why is that? Well, one reason is that we did deindustrialize, meaning fewer people have to work in factories to create the goods we want. We haven't deindustrialized in an absolute sense. We produce more now than probably at any other station in America's history, but it's been a success story. It's a rise in productivity, which means that we can make the goods with automation, make the goods more competitive and affordable to most people. That's what successful countries do.

There is a great section in The Capitalist Manifesto where you talk about the myth of working in Detroit in the 1950s and how the peak of industrial workers in the United States as a share of the labor force was actually in the 1940s. It was already declining in the 1950s. Can you talk a bit about that?

Yeah, it looked good compared to the rest of the economy because it was awful working in agriculture and in domestic traditional industry. Comparatively it was better than in many other places. Now we have this kind of nostalgic, gross, tinted image of what it was like. It's important to go back, and there are some historical projects interviewing the workers who really did the job and they're telling us, first of all, I do this so that my son will not have to stand and work in a factory like this because it is awful. It's dangerous, it's dirty, and you can lose an arm or two if you're not careful. 

Also, very insecure jobs, very rapid turnover. When I look at different cohorts, it turns out that there was one cohort in Detroit in 1953. They had fairly secure jobs, got a good decent wage, unionized, and so the whole myth of Western manufacturing is based on one city in one year. What did they get, the ones who got those best jobs? Well, adjusted for inflation, they get what you would get as a starting wage in an Amazon warehouse today. 

Is it a good thing or a bad thing that fewer men between the ages of 25 and 54 are actively in the labor force?

If people are able to work and want to work, it's a good thing, they should. They shouldn't be doing other things. That has been declining, but it has been declining for a very long time. That's important to point out. This is not something that happened when China entered the World Trade Organization, and it did not happen with NAFTA. It started after the Second World War basically, and it was actually much faster. The increase in men outside of the labor force was at a much higher rate in the 1950s, '60s, and '70s than in this era of globalization. It tells you that there's something else going on other than just competition. It seems like we are pretty bad at retraining and having the kind of mobility in the work force that we would want, but most of these people are then counted as disabled and they're in various programs rather than standing in the work force.

You actually went around the United States and talked to people who were on welfare. What did you find?

Well, I learned that you have to be very smart and hardworking to be poor and unemployed in the U.S., because the systems are so incredibly complex and they come from a wide variety of sources and they're based on different metrics. They then are also discounted and lost at various points when you make more of an income than you used to. What they told me is that it feels hopeless. It feels like there's nothing they can do to change their situation. One of them told me that, doing the calculations from four different benefits systems, if she increases her wage from $29,000 to $30,000, many of the benefits she receives would disappear, leaving her actual take-home income cut in half, so that she just makes $15,000.  t. In a way, the marginal tax rate for the poor and unemployed is much higher than for the rich.

They know that it's hopeless, basically, to go out there and sacrifice time, energy, and transportation costs to get a job because they notice that they don't make money