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Capitalism and the Common Man

Alan | 23.10.2006 16:33

Capitalism and the Common Man



There are some arguments, having a faint measure of plausibility, that have served politicians, charlatans and assorted do-gooders for well for over a century in their quest for control. One of those arguments is: capitalism primarily benefits the rich and not the common man. That vision prompts declarations such as: Congressman Richard Gephart's assertion that high income earners are "winners" in "the lottery of life." Then there's, Robert Reich, former Secretary of Labor, who says high income earners the "fortunate fifth." These nonsensical visions lead to calls for those who've been "blessed" to "give back" either voluntarily or coercively through the tax code.

While demagogic statements like these have high emotive worth, they reflect resolute, near incurable stupidity about the sources of income. Listening to some of the talk about income differences, one would think that out there somewhere is a pile of money. People who are wealthy just happened to get there first and greedily took an unfair share. Justice requires that they "give back." Or, there's talk about income distribution. The way some people talk, unequal distribution of income means that there is a dealer of dollars who shells out $1,000 to one person, $100,000 to another and a million dollars to yet another. Thus, the reason why some people are wealthy while others are not wealthy is that the dollar dealer is a racist, sexist, a multi-nationalist, or just plain mean. Economic justice requires a re-dealing of the dollars, income redistribution, where the ill-gotten gains of the few are returned to their rightful owners.

In a free society, for the most part, people with high incomes have demonstrated extraordinary ability to produce valuable services for, and therefore please their fellow man. Sam Walton, founder of Walmart, Bill Gates, founder of Microsoft, and singer Michael Jackson provided services deemed highly valuable by their fellow men who voluntarily took money out of their pockets to purchase those services. Their high incomes stand as unambiguous proof of that service. Their high incomes also reflect the democracy of the market place. For example, millions upon millions of independent decision makers decided to fork over $200 or $300 for Microsoft founder Bill Gates' "Windows 98" operating system. Those who think Bill Gates is too rich, and want to redistribute his income, are really registering disagreement with the democracy of the market place and want to cancel or offset the market "vote."

Indeed, we might think of the dollars people earn as certificates of performance. Think of it in the following way. You hire me to mow your lawn. After I have completed the task, you give me $20. I go to the grocer and demand a pound of steak and a six-pack of beer that my fellow man produced. The grocer says, "You're demanding something that your fellow man has produced. What have you done to serve him?" I reply, "I have served my fellow man by mowing his lawn." The grocer says, Prove it!" That's when I hand him my $20, my certificate of performance.

Income earners owe nothing else to their fellow man; they have met their social obligations. If "giving something back" means anything, it should be the admonition to thieves and social parasites: people who have taken and given nothing in return. We have it ass backwards. Highly productive people (the rich) like Sam Walton and Bill Gates are held up to social ridicule while thieves, bums and other social parasites are shown passion and concern and have become society's mascots.

Capitalism is the best thing that ever happened to the common man. The rich have always had access to entertainment, often in the comfort of their palaces and mansions. The rich have never had to experience the drudgery of having to beat out carpets, iron their clothing or slave over a hot stove all day in order to have a decent dinner; they could afford to hire people. Capitalism's mass production and marketing have made radios and televisions, vacuum cleaners, wash-and-wear clothing and microwave ovens available and well within the means of the common man; thus, sparing him of the boredom and drudgery of the past. Today, the common man has the power to enjoy much (and more) of what only the rich could yesteryear.

What about those who became wealthy making comforts available to the common man? Henry Ford benefitted immensely from mass producing automobiles but the benefit for the common man, from being able to buy a car, dwarfs anything Ford received. Individual discovers and companies who produced penicillin, polio and typhoid vaccines may have become very wealthy but again it was the common man who was the major beneficiary. In more recent times, computers and software products have benefitted our health, safety and quality of life in ways that dwarf whatever wealth received by their creators.

Here's a little test. Stand on the corner and watch people walk or drive by. Then, based on their appearances, identify which persons are wealthy. Years ago, that wouldn't have been a difficult challenge. The ordinary person wouldn't be dressed as well, surely not wearing designer clothing, nor would they have nice looking jewelry plus, they wouldn't be driving by. Compare the income status of today's airline passengers with those of yesteryear; you'll find a much greater percentage of ordinary people.

That's one of the great benefits of capitalism; it has made it possible for common people to enjoy at least some of what wealthy people enjoy. One might assert that common people don't have access to Rolls Royces and yachts. You're wrong. Microsoft's Bill Gates is super-rich and can afford to ride in a Rolls Royce and go yachting; but so can the average common man - just not as long. He can rent a Rolls or a yacht for a day, half-day or an hour.

Capitalism is relatively new in human history. Prior to the rise of capitalism, the way people amassed great wealth was by looting, plundering and enslaving their fellow man. Capitalism made it possible to become wealthy by serving one's fellow man. Capitalists seek to discover what people want and then produce and market it as efficiently as possible. Here's a question that we should ponder: are people who by their actions created unprecedented convenience, longer life expectancy and made more fun available for the ordinary person, and become wealthy in the process, deserving of all the scorn and ridicule heaped upon them by intellectuals and politicians? Are the wealthy really obliged to "give something back?" After all, what more do the wealthy discoverers and producers of, say, life-saving antibiotics owe us? They've already saved lives and made us healthier.

Despite the miracles of capitalism, it doesn't do well in popularity polls. One of the reasons is that capitalism is always evaluated against the non-existent, non-realizable utopias of socialism or communism. Any earthly system will pale in comparison to a Utopia. But for the ordinary person, capitalism, with all of its warts, is superior to any system yet devised to deal with our everyday needs and desires.

Alan