Giving Tanks

Across Europe, thinkers are promoting free-market ideals.

Wall Street Journal
Monday, December 10, 2007 12:01 a.m.

LONDON--The Heritage Foundation, the Cato Institute, the American Enterprise Institute and other free-market Washington think tanks are known to many Americans. What isn't generally understood is that there has been an explosion of free-market think tanks around the world that are increasingly challenging the conventional view that government is the solution to society's problems.

Last week the Stockholm Network, an umbrella organization for European free-market think tanks, held its first annual award ceremonies to honor the groups that have been most effective in informing policy makers and the general public about policies like school choice, portable pensions and decentralized approaches to delivering health care. The Wall Street Journal was a co-sponsor, in line with its adherence to an editorial philosophy of "free markets and free people."

In 1997, the Stockholm Network had five members; it now boasts more than 130 affiliated groups, stretching from Iceland to Armenia. In Bulgaria, the Center for Market Economics has played a major role in building support for the country's adoption of a 10% flat-rate income tax, effective Jan. 1. "Watch Bulgaria," says Steve Masty, an economic development specialist based in London. "The intellectual light bulbs that have been switched on there are now having real-world results."

More than one guest at the Stockholm Network dinner commented that several countries in Europe that escaped the Soviet bloc less than two decades ago are now pursuing reforms that would be regarded as too radical for Western European electorates. In Slovakia, the introduction of a profit-based health system has led to the entry of two private health-insurance companies that have helped drop the state share of the health-care market to 65% from 80% in just two years.

Some of the think tank presidents attending the dinner have suffered more than criticism for their work. Prof. Atilla Yayla, the president of the Association for Liberal Thinking in Turkey, gave a speech last year in which he stated that the single-party secular rule imposed by Kemal Ataturk in the 1920s "appears backward rather than progressive." He said he found it difficult to explain to visitors to Turkey why statues and pictures of Ataturk appear in almost every public space.

Mr. Yayla was viciously attacked in the media and subjected to criminal prosecution for his comments. Now teaching on a yearlong sabbatical in England, he plans to return to Turkey to continue his fight for a truly liberal society that represents a third way between Islamism and Ataturk's state-imposed secularism. He has more than 500 Turkish academics and intellectuals on his mailing list.


While the Stockholm Network focuses on Europe, that doesn't mean that free-market think tanks in developing countries are being ignored. This week the Cato Institute is launching a series of international Web sites to build support for the ideas of liberty and to promote the work of local think tanks. Web sites in French, Portuguese, Chinese, Kurdish, African languages and Persian will join existing Cato Web sites in Russian, Spanish and Arabic.

The project is the work of Tom Palmer, who 20 years ago as a young libertarian scholar smuggled photocopiers into the Soviet Bloc so dissidents could produce their own samizdat publications. "In many countries there is a clear need for private efforts not subject to or tied to any government entity," he told me. "Clearly, the government-led efforts aren't doing such a hot job of promoting the ideas of liberty at the moment."

John Blundell, president of Britain's Institute for Economic Affairs, says an increasing emphasis on promoting liberty in developing nations and among immigrants from those nations is appropriate. At IEA's annual conference for up-and-coming free-market scholars in October, white men were a distinct minority of the 100 students attending. The children of Indian and Chinese immigrants won almost half of the prizes and honorable mentions in IEA's annual student essay contest.

The original inspiration for much of the worldwide growth in free-market ideas was a slender volume written by F.A. Hayek, obscure professor at the London School of Economics, in 1944. As World War II was winding down and postwar planning for growing welfare states was under way, Hayek's "The Road to Serfdom," made a powerful case that the collectivist ideas then gaining ground would almost inevitably lead to a loss of liberty in all its forms.

Hayek also made a positive case that the venerable ideas expounded by thinkers like Adam Smith, David Hume and Edmund Burke, who promoted limited government and the rule of law, could prove a powerful antidote to socialism. Hayek urged proponents of liberty to build on the example of socialists, who built a network of theorists and philosophers that later helped them gain political power. He called for a "a truly liberal radicalism (in the European meaning of that term) . . . which does not confine itself to what appears today as politically possible."

A few years after publication of "The Road to Serfdom," a young entrepreneur named Anthony Fisher met with Hayek and started IEA. It spent 20 years building the case for a freer society until its ally, Margaret Thatcher, became prime minister in 1979.


While the Stockholm Network dinner was held in a celebratory mood, several speakers reminded the audience illiberal notions like protectionism are making a comeback in many countries, and that global warming has become a pretext for those advocating draconian limits on economic growth.

Such wrongheaded ideas are also on the march in America. Everyone seems focused on which party will control the White House and Congress after next November's election. But regardless of who wins, real changes in the public-policy landscape are likely to come only if those who hold political power also have won the battle for their ideas. That's why, despite the hundreds of millions of dollars being spent on the 2008 election, advocates on both the left and right are also pouring money into think tanks. They are preparing for the day when those ideas can be taken off the shelf and put to the test.