Reading that, people who know me may believe I have been taken over by aliens. Not true. It is about valuing what you have and noticing how you get it.
I like food banks, social welfare and organized charities because they are a cheap way for me to be able to concentrate on what I do well rather than seeking out unfortunate people who need assistance. I have little respect for those who abuse it, but for those who need it, I am pleased it exists.
I like good roads, clean air, safe water, sewage disposal, police, and fire protection. I like health and hospital care, accurate weights and measures, secure borders, and food safety. I like airports, canals, courts, and regulation of the necessary monopolies. I like public records.
All of these are examples of socialized spending.
I also observe that all of it is paid for from the fruits of capitalism.
Socialism generates no wealth. It merely consumes. That it exists at all is a tribute to how much humans want to help each other and how they value sharing costs. Some believe so much in the idea of helping that they have forgotten where the resources come from. Failing to understand how resources come to be is a fatal mistake.
As Margaret Thatcher has said,
“Socialism is a good idea until you run out of other people’s money.”
Attacking capitalism as the cause of poverty is like attacking farming as the cause of hunger. Money does not cause poverty and food does not cause hunger. It makes no sense to believe otherwise, yet people can be led to accept capitalism as a bad thing. Why?
Mostly because it is possible to convince people that others have more. Even too much, whatever that means. To believe some have unentitled wealth, one is required to also believe that more work, better skills, investment, and frugality should provide no additional reward. That point does not come up often in the discussion of how the world is unfair.
As a working thesis, suppose you believe the world is fair. Skill, work, investment and the ability to provide value to others would be useful attributes. They would result in more wealth for individuals and for society as a whole.
If we believe the outcome should be more equal, we must downplay the value of skill, work, investment and frugality. In this odd new world, we must elevate the value of ignorance, sloth, and spendthrift ways to be equally valuable attributes.
Hopefully few will see merit in that structure.
The reality of our world is few take out more value than they have put in. Bill Gates, the late Steve Jobs and Oprah have vast fortunes because they have received a little from each of many people who value what they provide. If you took Steve Jobs share out of the price of an iPhone, I doubt the price would drop by five cents.
From the other side, would anyone supply anything at all if they got nothing for skill, work, investment and frugality? Only maybe.
The world actually is fair. It is just ruthlessly objective about it and some people do not like what they can get from the world with their personal resource set and attitudes.
To believe capitalism is the cause of poverty requires that you believe things that are not logically possible.
Don Shaughnessy is a retired partner in an international public accounting firm and is now with The Protectors Group, a large personal insurance, employee benefits and investment agency in Peterborough Ontario.