Sometimes you have to wade through a bit of bog before finding solid ground.
That boggy feeling struck as I began to read Columbia Professor Edmund Phelps’s recent article, “Economic Justice and the Spirit of Innovation,” in which the professor claims that “the prevailing view on the left” tolerates “inequalities of income” as long as they “benefit the lowest-paid workers.” Really? Phelps alleges that “few voices on the left” object to Bill Gates’s wealth “because the general perception is that everyone is better off as a result of inexpensive personal computers.” Strange assertion, considering the constant noise about “economic injustice” perpetrated on the “less fortunate” by “greedy” people.
But Phelps eventually hits terra firma.
If we agree that successful market participants should pay taxes to assist the poorest, the question is, What tax rate will optimize government revenue? That is not a moral issue but a technical one.
There are Scrooges who insist that their taxes don’t go to the “surplus population,” but the vast majority of successful people are glad to assist the less successful. Yet, how?
Should an omniscient bureaucracy reallocate assets? This is the view from the left. But clear thinkers prefer an approach that has historically maximized the “common welfare.” Phelps points out, “Innovation makes scarce goods abundant. This quest to do better… is part of what makes us human.” Such truth makes it obvious how silly it is to argue with people who want humanity to cut consumption, to live “simpler” lives. Obama science advisor John Holdren, other zero-growth pushers, Obama himself, and myriad fellow anti-capitalists reject reality.
How does a rational person deal with someone trying to smother them? Enlightened ones would engage the attacker in dialogue while the rest of us would act more decisively. And decisively we must act. Barack Obama has shown no willingness to budge from his agenda—an agenda which threatens to strangle business and prosperity. He and others like him must not be bargained with. They must be defeated.
The left’s scarcity worldview overlooks a “fundamental human trait” that Professor Phelps calls the “spirit of challenge and self-discovery.” Business risk-takers, not government, produce “social benefits.” Risk-takers leverage the “restlessness” of the human heart, and cultures that smother this spirit “stagnate and die.”
Socialism kills by rejecting such truth. Socialism takes the scarcity view, outlawing challenge, self-discovery, and restlessness. The Soviets stopped their stagnation after 70 years of societal suicide. Their cure: capitalism. The Chinese have gone capitalist. Europe’s social democracies discovered hopelessness in the command-and-control approach. Yet King Hopey-Changey pushes America toward that same misery with automotive, health care, and energy sector takeovers as well as dozens of “czars” directed to command and control all aspects of the economy.
Professor Phelps finds that morality in economics comes down to “how human institutions can be shaped to correspond to human nature…” And indeed, there is no “moral imperative” to make life “fair.” Phelps has captured the work of economists Ludwig von Mises and Friedrich Hayek. Mises’s “human action” and Hayek’s observations on the futility of central planning and the prosperity created by freedom teach us that innovation is critical to “spreading the wealth.” Government only consumes wealth.
Capitalism is the only economic system… that allows human beings to realize their nature to innovate, discover, and take risks.
Only ill-informed mushrooms, leftist zealots, idealistic dreamers, or some combination thereof would doubt Phelps’s declaration.
Which brings us back to Barack Obama.
The scarcity-minded Obamas of the world persist. Do they get human nature? No, they want to redesign human nature. Has Barack Obama talked of unleashing individual creativity? Has he waxed eloquently on the power of the unburdened private sector to stimulate soaring growth? Besides once quipping that he “screwed up,” have we heard Barack Obama admit error? The One simply knows best, and wants to inflict his knowing on us with the force of the biggest government he can create—for our own good.
Ever since the days when Adam Smith captured the beauty of capitalism, the truth has remained clear: The free market advances society. Yet in the real world, with stunning triumphs come spectacular collapses. The left’s “fix”—removing risk—snuffs human creativity. The scarcity view holds that there’s not “enough to go around,” so we must save some for those who get slighted. Meddlers seeking to eliminate the free market’s occasional unpleasantness bring about pervasive benign mediocrity and replace mere unpleasantness with the asphyxiating boredom of a Caspar Milquetoast society.
Even with its ups and downs, capitalism has catalyzed the most astounding long-term cultural and economic progress in the history of civilization. But self-anointed messiahs still think that they can legislate changes in human nature that will eliminate failure. Yet the guranteed result would be atrophy of effort and elimination of success.
Why are these people called “progressive?”