The Economy

The economy has been a big topic for years. Every day there is news about housing prices, stock markets, unemployment rates, student loans, government debt, credit rankings, etc. There are protestors in Greece against austerity measures. There are protests in New York against the discrepancy between rich and poor. There are protests to cut taxes and government spending. The fact is that many people are unsatisfied with the economy and they do not have the quality of life that they want to have. Itís hard out there for most people. Sometimes when I see these things, I think about the economic portion of the main Individual Valuism text and I am no longer satisfied with what I wrote. I was trying to promote individual thought and freedom but I ended up doing exactly what I hated: I made a bunch of assumptions about what is right and pretended that it was the universal correct answer.

Moreover, I oversimplified a complex issue. I took a problem built by tens of billions of people over millennia and I ignored the past and made vague platitudes about the present. I think that I had been reading Atlas Shrugged at the time. In the book, protagonist Dagny Taggart tries to run a railroad business while struggling against the government and a growing popular opinion in favor of public service and against profit-seeking endeavors. Inevitably, the few profit-seekers were the only people to actually produce anything of value, while the majority of people formed gangs to control and take anything produced. When the producers had been in charge, systems ran efficiently, innovation was constant, and more than enough food and goods were available for purchase. When the gangs were in charge, production crawled to a stop and millions starved. Clearly the apparent virtue of the public good was not very good at all. Whether or not the book was realistic, I did have a low opinion of the government. They seemed to be incompetent, inefficient, and prone to taking my hard-earned money to fund projects that I may or may not like. I thought that besides providing justice and defense, the government should just leave us alone and stop trying to ďfixĒ things. After all, people can make optimal rational decisions about trading their property and labor without meddling interference.

However, over the years I have realized that it is not that simple. Letís add some real-world context to the struggles of the fictional railroad owner. By what right does she own or control the land under which her trains run? How many people worked and died to explore, cultivate, conquer (steal?), and defend that land? Where did her raw materials come from? By what right do they take copper, oil, coal, and iron out of the ground? Why should she get all the profits while everyone endures the air pollution, noise pollution, and industrial waste that are associated with her business? What about the people that developed the concepts of railways and the people that developed and improved the steam engine? Do they have intellectual property rights? When they died, did those rights pass to their descendants, to everybody, to nobody? What does she owe the police, army, and courts for deterring and punishing bandits and invaders? Who decides liability if her trains crash and kill people? Should she be punished if she makes deceptive advertising? Why does she feel that she deserves to own the business? Her grandfather established it and she just inherited it. If her parents had sold it, then she would be the same person but would not be entitled to own the business. Does that make sense? Would she be able to start her own railroad company? Would it be fair if larger companies signed exclusive contracts to prevent her from competing?

I donít claim to have the right answers to these questions. There are no right answers! Concepts of rights and fairness are like concepts of goodness. They are just words to describe what we want to happen. People like to talk about who deserves property or control as if there are objective answers but the only thing that is objective is the nature of cause and effect. Economic policies affect the way people behave. Some policies will cause people to work hard, produce high-quality results, and create new things. Some wonít. Some policies will make people happy. Some will make people complain, argue, protest, disobey, steal, riot, kill, or go to war. It is hard to find a balance that makes most people happy, but people are just making stuff up when they talk about rights or fairness. Rights only exist to the extent that people allow them or fight for them. Fairness depends on value judgments and it is impossible to align the values of seven billion different people.

Of course, resources are limited, people have a variety of needs and abilities, and we have to live together somehow. I have my own beliefs about economic policies. I think that intellectual property should be protected so that people are motivated to create new and better ideas and the world will have new and better creations. However, I do not think that intellectual property should be protected forever because that would hinder human progress by stopping people from using ideas that are old, common knowledge, and things that other people would have discovered in time anyway. I think that as workplace efficiency increases that the number of hours people work should decrease so that unemployment can stay low and amount of leisure time can continue to rise. I think that everyone should have a chance for a quality education so that they can be prepared for life, do things well, and cannot blame others for lack of success. I think that people with skills in high demand like doctors should be rewarded over people in other positions so that people will be motivated to have useful skills. I think that the government should collect taxes to use for public safety, justice, education, roads, parks, consumer protection, and other projects with serious public benefit that individuals generally cannot organize competently or fairly. I donít think that taxes should be spent on other items, so that people will have more money to spend at their own discretion. I think that there should be less income, property, and sales tax compared to estate tax so that people will have more money to actually live and for there to be the dispersal of potentially ill-gotten hereditary land and wealth. I think that people should generally have private ownership of property and wealth so that they can do what they want without meddling from others, take pride in what they have, and feel a personal stake in everything being in good quality.

If you disagree that the policies that I proposed would have the effects that I stated, then that is a reasonable debate with a potentially knowable objective answer because it is a matter of cause and effect. If you disagree with why I want the effects to exist, then that is a conflict of values and a resolution may not be possible. I canít make other people agree that the world should be a certain way. We can either live together peacefully or we can fight. Hopefully we can be productive and have a system that is right to most.