"People before profits,"
chanted the protesters at the G-20 Summit in London last week, and
"Death to Capitalism." Stupid epithets by stupid people, professional
revolutionaries blinded by envy and ignorance.
The mentally indolent
demonstrators are oblivious to what they mindlessly promote. Lacking the
ability to reason they simply advocate socialism, which is exemplified
ultimately by North Korea with its people before profits. Try these
stunts in the socialist paradise of North Korea and the government would
lock them in a secret room, and not just throw away the key, but throw
away the room.
When you put people
before profits you get North Korea's priority of launching satellite
missiles before food production (albeit with good jobs for people
building missiles). The demonstrators fail to understand that without
profits there is no way to make economic calculations. Profits determine
what is to be produced and in what quantity and quality. Consumers, by
buying or abstaining from buying, determine profits and make poor men
rich and rich men poor.
One hundred years ago 85
percent of Americans lived in dire poverty by today's standards. Today,
85 percent live in luxury by the standards of 100 years ago.
In this country we
classify people as deprived despite their having telephones,
televisions, automobiles, refrigerators, electricity, modern heating,
indoor plumbing and hot and cold running water at their fingertips.
Things many people around the world only dream about, and unimagined in
pre-capitalist kingdoms.
How do we explain the
stupendous outburst of creativity that has resulted in free nations
having the highest living standards at any time in history? Why do
welfare recipients have more necessities than kings and queens, princes
and potentates of a century ago?
No storybook genie of
magic has ever bestowed as many miraculous gifts as has free market
capitalism bestowed on those countries that have adopted systems of
limited government, private property and market economies.
Under a predominantly
capitalistic economy in America we feed not only 300 million Americans
but over 100 million in foreign lands. In this country we have conquered
or controlled diphtheria, smallpox, typhoid, polio, measles,
tuberculosis and pneumonia. The ancient scourges that plague other
countries no longer sweep across our land leaving death and heartaches
in their path.
We have built more
schools, colleges, hospitals and libraries than all other generations
since the beginning of time. We have graduated more scientists, doctors,
surgeons, dentists, lawyers, teachers, engineers and physicists than did
our forbears in the preceding 1,000 years.
We all want to see other
people better off, better fed, clothed and housed with better education
and health care, more recreation and leisure. But no matter how high the
standard of living in any nation, there always will be people in the
bottom 15 percent. Since the bottom 15 percent seems to be the default
definition for the ever-increasing incomes of those living in poverty,
"The poor will always be with us."
If we were foolish enough
to listen to the London protesters instead of getting rid of poverty,
we'd eliminate prosperity. For an explanation of why people hate
capitalism including some reporters,
New York Times owners,
Hollywood stars, planners and wealthy scions, SEE: "The
Anti-capitalistic Mentality,"
http://mises.org/etexts/mises/anticap.asp
North Korea is not poor
because America is rich or some Americans poor because some are rich.
When people state that income and wealth are distributed inequitably
they in effect are implying that redistribution is required, and are
explicitly stating that the world's wealth is "theirs" to distribute.
This is the Santa Claus
fable that John Maynard Keynes raised to the dignity of an economic
doctrine. Many of the people in Washington, D.C., seem to think that all
wealth is stored in a big pot of gold at the end of some rainbow and all
they have to do is tax it and dole it out. Too dull to realize that
wealth has to be created every day, earned every day, and the greater
you tax wealth and productivity the less you get of it.
Whenever someone calls
for a redistribution of income what they mean is that an unearned share
of the wealth produced by others should be redistributed. It needs to be
reiterated that income is not distributed -- it is earned. Economist
Thomas Sowell has cited census data showing that U.S. households in the
top 20 percent had more than 19 million people working and there were
fewer than 8 million people working in households in the bottom 20
percent. How inequitable is it that people who work earn more money than
those who don't.
It takes a great deal of
capitalism to pay for all the socialism politicians love to promote and
politicians who take from Peter to pay Paul can always count on Paul's
support. When people cite non-totalitarian partially socialist countries
such as Sweden they fail to mention that it is the capitalist portion of
their economies that pay for the social welfare. Also, while the tax
burden on individuals is substantially higher than in the United States,
tax rates on businesses are substantially lower, allowing the
accumulation of more capital for more capitalism. Otherwise, once they
consumed their seed capital they'd be like North Korea.
The protesters around the
world pretend they are protesting against capitalism as the cause of the
worldwide recession and look to more government to solve the problems.
If governments had the power to end recessions, however, they would have
the power to prevent them -- but a little investigation shows that
governments are the cause of recessions, and only wars or free market
capitalism can end them.
Schnaubelt, president of Citizens for Private Property Rights, has been
a commercial real estate broker for 39 years and was a San Diego city
councilman from 1977-81.
