It is taken for granted in countless ill-informed Facebook memes that the Nordic countries are the happiest, healthiest and most prosperous on earth, and that this is thanks to their huge welfare states, generous social services and compassionate regulations that afford workers high minimum wages, lengthy holidays and enviable benefits.
Congratulations to the winners of the IPA’s Blue Poles Writing Competition, which asked entrants to explain, in 350 words or less, why the government should NOT sell Jackson Pollock’s $350 million dollar painting ‘Blue Poles’. Each of these entrants is now $350 richer! Remember to stay tuned for more IPA and Generation Liberty writing competitions for chances to win generous prizes and to contribute to the public debate!
These are the winning entries:
Two anniversaries that fall in October, both important for lovers of western civilisation, highlight the new iconoclasm at the heart of modern western progressives.
In Part I and Part II of this article, we showed that profits (at least in the absence of coercion or a state-conferred special privilege, such as a subsidy or monopoly right) are not derived from exploiting workers. But to really push back against the unjustified persecution of profits, it is not enough to prove that they are not exploitative. Instead, why are profits actually good?
In the Part I of this article, we examined the most important reason why profits are not derived from exploiting workers. Essentially, they are an implicit form of interest that workers are willing to pay for the capital that is implicitly loaned to them by capitalists. Workers may receive less than the market value of the additional output they bring to a firm, but they see this as a desirable arrangement because they can produce so much more overall due to their access to their employers’ capital, so that their income is higher than it could ever be if they only worked for themselves.
But that is not all that profits are.
Chances are that when you think of capitalism the great minds of Adam Smith or Milton Friedman spring to mind. Chances are the words ‘growth’ and ‘profit’ may also pop up. Depending on what your understanding of free market capitalism happens to be, words like ‘profit’ may be associated with empowerment through the creation of prosperity, or on the other hand maybe associated with greed and excess.
When I think of the free market, I think of the most basic truth of all; both buyer and seller are better off for their exchange, and society at large is better off from these infinite interactions. Adam Smith’s Invisible Hand.
A seller who seeks to create genuine value for their customer and establish for themselves repeat business will do their utmost to trade with honesty (in pursuit of ‘perfect information’) and service their customer’s segment with dynamism. Consumers (that we all are) will always be looking for the best available option to suit their needs at any given time. As a result, only the best businesses survive.
One of the most infuriating bumper stickers has to be the one that reads “People Before Profits”. This insufferable slogan bespeaks an endemic and illiterate assumption in anti-market thought: the notion that profits are counter to the interests of people; that they are, by definition, exploitative.
By Daniel Press
A top professor of public health and income inequality, Sir Michael Marmot, recently proposed a thought experiment in third-world development on the ABC’s Q&A.
The National Gallery of Victoria’s exhibition Degas: A New Vision, is the most comprehensive collection of the works by the French painter and sculptor, Edgar Degas(1834-1917) since 1988.