The basic problem of
economics - How can we make our country prosperous?
- was solved long ago, in the 18th century, by
Adam Smith
and other thinkers of the Enlightenment.
Yet some people, all these years later,
still don't believe it.
I, Pencil
by Leonard E. Read, 1958,
explains how capitalism is just the way the world works.
It is what humans do when they are free.
It is as old as civilization.
It is a great, even heroic human endeavour
- "not a single person on the face of this earth knows how to make me".
And it is how humanity makes all of the wonderful things
that make life so comfortable
for the bourgeois anti-capitalist protester.
The mind of the left
- Why do many supposedly educated people in the West reject capitalism?
It is one of the fundamental mysteries of intellectual life since 1850.
Leigh Scott, 1 Feb 2010, makes a nice point about the left's criticism of capitalist "greed".
"Greed is a lame scapegoat, but it's an easy one. Politicians, authors and filmmakers don't sound as pious railing on about those of us who "work harder" than others and therefore have more than the rest. It doesn't flow off the tongue as easily to assail those who have "risked greatly" and have been rewarded handsomely for their efforts.
But going off on the "greedy" sure makes a great speech."
Christmas in a western shopping centre. Hi-tech phones
and glossy books
and cafes
and mulled wine.
Whereas the lot of humanity for most of its history has been
starvation and terror.
Some people
think the above is "vulgar capitalism", distasteful and repellent.
But only someone who is already rich and free could think that way.
While I personally prefer the urban street to shopping centres,
and while any particular shop or display may
aesthetically offend me,
overall
capitalism has liberated us, not oppressed us,
and we should be grateful every day for the well-ordered free market
and property rights
that have delivered all these wonderful goods to us.
We are lucky, and we should be happy and grateful.
See full size.
Image from here.
See terms of use.
Capitalism is moral
Capitalism doesn't just make countries rich,
while socialism makes them poor.
We all know that.
It's old news.
But there is more:
Capitalism is morally
superior.
The Center for the Advancement of Capitalism
- Capitalism is moral
because it allows people to be free to pursue their own lives
and dreams.
Socialism is immoral
because it makes people subjects, chattel,
owned by the state,
which will plan their lives
and tell them what to do.
The Moral Basis of Capitalism
(and here)
by Robert W. Tracinski
- Businessmen and merchants are history's heroes
just as much as scientists and engineers.
Wealth is good
Some wealthy, comfortable western romantics claim that "money can't buy happiness".
That affluent societies are not happier.
That the third world often has a stronger and better family and social life than we do.
Pew Survey, July 2007
shows this is not true.
There is a strong correlation between
GDP and the level of satisfaction people express with their lives.
The correlation between money and happiness.
From the Pew survey above.
If it is true that wealth is good, and poverty is bad,
then who is actually ending poverty and creating wealth?
The fact is that the right is the friend of the poor.
The left is the enemy of the poor:
There is a central paradox of capitalism that seems extremely hard
for most people to understand.
It is
the difference between
intentions and outcomes.
The New Left?
- nice short post by Frank McGahon
on the difference between
intentions and outcomes.
The left might want to end poverty and unemployment,
but their policies (high tax, redistribution of wealth)
actually increase poverty and unemployment and emigration.
Whatever the right's intentions
(and, as McGahon points out, who cares?)
their policies
actually reduce poverty and unemployment and emigration.
So anyone who cares about the poor and about reducing unemployment and emigration
should support capitalism, and should support the right.
In Ireland,
for example, poor people should vote for FF and the PDs,
since FF and the PDs have helped the poor
(by massively reducing unemployment and emigration, for example).
Sinn Fein,
on the other hand, is an enemy of the poor,
its policies will hurt the poor,
and poor people logically should not vote for it.
"Most of the harm in the world is done by good people"
- Certainly true when one thinks of Christianity, Islam, socialism, communism
and nationalism.
"Most of the good in the world has been done by 'greedy' people
- people out to better themselves"
- Certainly true when one thinks of science, medicine, technology, capitalism,
consumer goods, media like the Internet,
and the vast improvements in living standards, wealth, health and life expectancy
in the last few hundred years.
"Want and greed are why humanity today is freer, healthier and more comfortable than it's ever been. Nearly every significant innovation, invention or improvement that man has so far come up with resulted from the innovator, the inventor or the improver's desire to better his own condition,
or, put differently, to get more stuff."
Milton Friedman on greed,
Phil Donahue show, 1979.
From here.
Press release, 25 June 2002
- "Africa's persistent
poverty is not due to a lack of foreign aid
- African nations are the largest aid recipients - but to a
lack of economic freedom on the continent."
In 2008, Australia ranked 3rd on the "Starting a business" subindex.
In Australia there are 2 procedures required to start a business,
taking 2 days to complete.
The official cost is 0.8 percent of the Gross National Income (GNI) per capita.
There is no minimum capital investment required.
In contrast, Guinea-Bissau ranked worst (181st) on the "Starting a business" subindex.
In Guinea-Bissau there are 17 procedures required to start a business,
taking 233 days to complete.
The official cost is 256 percent of the GNI per capita.
A minimum capital investment of 1007 percent of the GNI per capita is required.
Ease of Doing Business Index, 2006.
Green nations rank higher, red nations lower.
Africa is poor because governments in Africa make it hard to set up a business there.
From here.
FAQ - Is the net effect of globalization good or bad?"Results in previous years challenged the conventional wisdom on such issues as income inequality,
wages, environmental protection, corruption, and political freedom by showing that, on par,
the most global nations are also those with the strongest records of equality,
the most robust protection for natural resources, the most inclusive political systems,
and the lowest corruption. Moreover, there appears to be little proof that global nations
have trimmed social benefits or slashed workers' wages in an effort to get ahead. Adding to the picture,
this year's results also demonstrate that the most global countries are those
where residents live the longest, healthiest lives and where women enjoy the strongest social,
educational, and economic progress."
Perhaps the clearest finding in all of economics is the
correlation between economic freedom and prosperity.
Compare the table of
economic freedom
with the table of
the richest countries.
Socialists claim to want to make people better off.
They claim to want to reduce poverty, not increase it.
And yet they refuse to approach the issue scientifically,
namely by seeing what actually does reduce poverty,
and adopting it.
If you want your country to be prosperous,
the most logical thing to do is the following.
Forget ideology.
Forget your pre-conceptions.
Simply look at the countries high on
this list,
and do what they do.
Discussion:
"Heritage and the WSJ ask an important question: Cultures may differ around the globe,
but the pursuit of prosperity is universal. Might the key to prosperity be universal as well?
The answer has to be 'Yes'.
...
The message is clear: allowing people the freedom to keep their money by lowering taxation,
the freedom to trade by removing trade barriers and defending property rights and minimal regulation
is more effective in alleviating poverty than any number of NGOs"
World GDP per capita, 2007.
Compare with map of economic freedom above.
Economic freedom is clearly correlated with prosperity.
From here.
He has an optimistic, life-affirming philosophy, like me.
He wants everybody to be rich, and to be happy and grateful for it,
not guilty and negative.
Extract
- "I like an argument that suggests that the West is just plain fortunate,
and perhaps we in the Anglosphere are especially so, and that we will enjoy ourselves much more
when we recognize it and are grateful for it.
Lucky people ought to be gracious, and grateful,
and if modern society has a failing, it is that we are not yet enjoined to be either.
Our intellectuals, artists, and "role models" tend to line up with the complaint,
not the celebration."
Polish man wakes up in 2007 after being in a coma since 1988
(and search)
- He is a powerful reminder of how little we appreciate the
wealth and variety that global capitalism has brought us.
And how little we appreciate the strong
anti-communist forces
that defeated communism and liberated Europe.
"When I went into a coma, there was only tea and vinegar in the shops.
Meat was rationed and there were huge petrol queues everywhere.
Now I see people on the streets with cellphones
and there are so many goods in the shops it makes my head spin."
And yet people still complain:
"What amazes me is all these people who walk around with their mobile phones and yet they never stop moaning.""The world is prettier now" than it was under communism, he says.
Louis C.K.
on how people don't appreciate the wonderful world
that capitalism and science has delivered for us.
"The great revolution of the twentieth century will turn out to be the
liberal revolution
- by 1970 it was already patently obvious that the socialist revolution
had failed everywhere."
-
Jean-Francois Revel.
"In the past five hundred years, perhaps in all history, there has only been one genuinely successful revolution - one that delivered on its promises for a better world, based on the principles of freedom, equality, enterprise and endeavour; one that actually succeeded, despite the acknowledged imperfection of some of its outcomes.
...
It was the American Revolution of 1776. That's the only one that has ever really worked."
- Rob Foot,
The New Anti-Semitism?
"in the long violent saga of mankind we have rarely done anything as benign as going shopping, rarely devised anything as socially advantageous as property rights and the rule of law, rarely enriched the poor or enhanced lives as we did by creating capitalism."
- Daniel Finkelstein
on those who criticise capitalism.
shows this is not true.
There is a strong correlation between
GDP and the level of satisfaction people express with their lives.
on how people don't appreciate the wonderful world
that capitalism and science has delivered for us.
Since 1995.
