Monday, August 14, 2006

Wealth, or, Get Off Your Duff

People often speak on and on about how the world is a terrible, horrible, rotten place where some live a great life while others suffer (or often, some life a great life because others suffer).

This is erroneously linked to two ideas: one, that wealth exists, like a natural resource; and two, that there is a finite amount of it in the world.

For the first, wealth doesn't exist. There is no natural resource in the world that can produce wealth by its own inherent existence. Even something as simple as lumber requires ingenuity and hard work to gather (ever cut down a tree? How about planed the lumber? Made planks? A house? Or perhaps furniture?). The only true supply of this fallacious category is food; but even game requires hunting, and berries require picking.

Wealth requires effort to be created. In a free society, if one man is wealthy and the other is not, it is because at some point, someone worked harder than someone else. If two men start off poor, and one man dies rich while the other dies in rags, the only differential is work. Any other excuse and you've reduced yourself to a dependence on God, Luck, the Furies, Fate and her string, the Man, or any number of crutches that will permanently cripple a culture. God is omnipotent - but he helps those who help themselves. Fortune favors the brave; Men create their own luck. Wealth must be created. In this, Americans are lucky. We have a huge head start on many cultures because we, as a minority, embrace the concept that wealth can be created from the day we are born. We say as a colloquialism that we make money. No other culture or language has this specific idiom, this specific jewel of thought that defines so well the concept of our puritan, hard-working roots. Make money. Not find, inherit, steal, or fall afoul of. Make. Create. Shape. Form. Wealth is created, through blood, sweat, and tears.

Because of this, there is no cap on the amount of wealth in the world. It is not a lode that runs dry, or a harvest that once scythed is no more. Each investment of work and effort creates a new vein to tap. Any culture that embraces this will be successful. Any culture that does not will atrophy into victim hood and self-hate. This is where the fallacious idea that wealth must be redistributed comes from. The debunking of this finite-wealth mentality also destroys the idea of the evil profiteer. The man who makes a profit is not doing so at the expense of someone else's share of the bounty. As wealth is a fluid, dynamic, producible commodity, he isn't taking anything from anyone. A short analogy is in order.

If you were hiking, perhaps on Everest (for illustrative purposes) and there was a finite amount of food available, you would be wrong for hoarding the lion's share. You would be further in the wrong in eating at the expense of others in your party, perhaps contributing to someone's demise. However, if you were locked in a hypothetical perpetually restocked grocery store with your party and some were refusing to get meat because they began in the magazine aisle, and thus where meat-disadvantaged -- why, you'd tell them to go get their own meat. Or, perhaps, you'd trade a sirloin for the latest People magazine. And turn around and trade it for three packages of yogurt or to the guy who found the Chips Ahoy. Thus, capitalism is born.

Analogy is always suspect, but I feel this one is decently close to the mark. The main failing of it is that it is too easy; wealth is not to be plucked from the rack, but rather to be gained, created, earned.

As an addendum, nothing in life is free. Absolutely nothing comes without a cost. Even life itself is purchased through much pain, tribulation, and gasping effort on the part of the new mother. The idea that "the best things in life are free" is a misconception -- it should read "the best things in life cannot be purchased with money". Then, its true form is revealed.


Matt said...

You preach and preach about the greatness of the "free capitalist market". You're implying that a market left alone, fixes all problems. First of all, a market completely left alone, devoid of government regulation is thoroughly unstable. Capitalism is great, regulated capitalism is better.

Take a sociology class. I'm not an economist, but I know that when one social class obtains wealth, it is ALWAYS at the expense of the lower classes. If this is the case, how can wealth be infinite? I'm not sure I understand this concept, and I know it's one of the main assumptions that jumpstarted capitalism. It seems like a nice idea on paper, but reality just doesn't reflect that assumption. People work their ASSES off, and still can't scrape by without eating ramen noodles everyday.

Employers base their income on the profiteering, and exploitation of human labor. The people who work the hardest in this country (physically) make next to nothing for wages. This is because they're usually uneducated. Your party is cutting funds for education left and right every single day. My mom, who teaches, recently had to take up another full time job at another school to keep making the same amount of money than she did two years ago.

"Pull yourself up by your own bootstraps". That's the point that you're making. Unfortunately, life isn't as simple as that. Sociologists know this because the division of social classes too often is dictated by an individuals personal environment growing up. Therefore, the state of division is perpetuated generation after generation. Republicans trying to get rid of the "death tax" as they call it, don't help this problem either.

Your post conveniently sidesteps the issue of inheritance. Do I deserve 50 million dollars when my parents die simply because I was lucky enough to be born into an uber-rich family? I didn't work to attain that wealth, but that's okay for the people who so regularly tout the "work" that is put into becoming rich. Look at the actual numbers of the distribution of wealth in this country over the last 100 years. You will be astounded as to how rich the rich have gotten in the last 10. It's absolutely ridiculous. And that is the trend that shows itself when a market is completely devoid of regulation.

k2aggie07 said...

Yes, I think of a free market as a game. Football is a good scenario, or soccer. You do need rules, or else the other guy will just hire bigger, thuggier players and clobber you. I think the government should act as a referee. However, just as in soccer, an over-refereed game can be ruined, or downright unplayable. The rules are important, and they need to be fluid, but too many and you stifle the flow of the game.

Your sociology professor was a socialist. He ascribes to the "finite wealth" death-spiral that all socialists do. Simply stating that one class cannot gain without another losing does not make it so. If I hire you (me rich, you poor) and pay you a fair wage (that is, a wage that is competitive with what other employers are paying) to do a job, how am I exploiting you? Riddle me that.

As to your comment about physical labor not being rewarded, you're dead wrong. People who are willing to work hard will make a killing. The folks on minimum wage are the guys at McDonalds doing the (comparitively) soft, cushy jobs.

The concept of employment at will effectively nullifies your concept of exploitation of human labor. Wiki it... basically, employees can leave at any time to find a better job.

Companies can NOT force ANYONE to work for them. The only force in America that can make people do anything is good ol' Uncle Sugar.

For the rest of it, see the next post!