The key insight of Adam Smith's Wealth of Nations is misleadingly simple: if an exchange between two parties is voluntary, it will not take place unless both believe they will benefit from it. Most economic fallacies derive from the neglect of this simple insight, from the tendency to assume that there is a fixed pie, that one party can gain only at the expense of another.

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A society that puts equality — in the sense of equality of outcome — ahead of freedom will end up with neither equality nor freedom. The use of force to achieve equality will destroy freedom, and the force, introduced for good purposes, will end up in the hands of people who use it to promote their own interests.

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The essential notion of a capitalist society ... is voluntary cooperation, voluntary exchange. The essential notion of a socialist society is force.

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We have a system that increasingly taxes work and subsidizes nonwork.

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Higher taxes never reduce the deficit. Governments spend whatever they take in and then whatever they can get away with.

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You cannot simultaneously have free immigration and a welfare state.

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If you pay people not to work and tax them when they do, don't be surprised if you get unemployment.

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If you put the federal government in charge of the Sahara Desert, in 5 years there'd be a shortage of sand.

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Government has three primary functions. It should provide for military defense of the nation. It should enforce contracts between individuals. It should protect citizens from crimes against themselves or their property. When government-- in pursuit of good intentions tries to rearrange the economy, legislate morality, or help special interests, the cost come in inefficiency, lack of motivation, and loss of freedom. Government should be a referee, not an active player.

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One of the great mistakes is to judge policies and programs by their intentions rather than their results.

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