Day 88 of 1000
I subscribe to Hillsdale College‘s free monthly speech digest, Imprimis. It is a pamphlet size publication that advocates for conservative principles. I think I must have signed up for a periodic email titled “In the News” from them because one of them shows up in my email box every now and then. The last one featured an article titled Occupy Wallstreet Crowd Blind to Benefits of Capitalism by Gary Wolfram that was reprinted from the Media Research Center‘s Business and Media Institute blog. It made reference to a funny Monty Python bit about how the Romans had not given the people they conquered anything but sanitation, medicine, education, wine, public order, irrigation, roads, the fresh water system and public health, and peace.
Wolfram goes on to explain the reason that capitalism works so much better than socialism and why so many people are confused about capitalism in similar way to the Monty Python skit:
The Occupy Wall Street movement has shown a lack of understanding of how the market capitalist system works. They appear to think that the cell phones they use, food they eat, hotels they stay in, cars they drive, gasoline that powers the cars they drive and all the myriad goods and services they consume every day would be there under a different system, perhaps in more abundance.
But there is no evidence this could be or ever has been the case. The reason is that only market capitalism solves the two major problems that face any economy-how to provide an incentive to innovate and how to solve the problem of decentralized information. The reason there is so much innovation in a market system compared to socialism or other forms of central planning is that profit provides the incentive for innovators to take the risk needed to come up with new products.
My mother never once complained that we did not have access to the latest Soviet washing machine. We never desired a new Soviet car. The socialist system relies on what Adam Smith referred to as the benevolent butcher and while there will undoubtedly be benevolent butchers out there, clearly a system that provides monetary rewards for innovators is much more dynamic and successful. The profit that the Occupy Wall Street protesters decry is the reason the world has access to clean water and anti-viral drugs.