Friday, June 15, 2018

The Bogus Basis of the Minimum Wage

[This article was originally published on April 19, 2016.]

In the fall of 2013, nationwide protests pushing for drastic increases in the minimum wage—and the endorsements of politicians like President Barack Obama—revived the perennial controversy over the wisdom of this three-quarter-of-a-century old federal policy. Advocates of minimum wage hikes have now won their latest victory in California, where the legislature recently voted to raise that state’s minimum wage from its current rate of $10 an hour to $15 by 2022. Professional economists will continue to debate whether the minimum wage makes low-skilled workers better off or prices them out of work and costs consumers more in higher prices. What usually goes unmentioned in the discourse, however, is that the concept of a mandatory “living wage” makes little sense in principle. Employers’ duty is to pay workers according to the value of their labor, not to pay them enough to cover their cost of living—or any other arbitrary benchmark.

Support for minimum wage hikes stems from the belief that all full-time work is worthy of compensation generous enough to enable employees to live comfortably. This well-meaning misconception treats jobs as if they were social programs, designed to lend a helping hand to people who need it. In reality, workers are not charity cases; they do the work that their bosses need them to do in order to accomplish those employers’ missions. McDonald’s, Burger King and Wendy’s don’t hire their cashiers and burger-flippers in order to help them out; they pay them to produce and serve their customers food, hopefully at a tidy profit.

Indeed, this reality applies to all employers, not only to profit-seeking businesses. Police officers are paid to enforce laws and protect the public; employees at charities and non-profits are paid to serve certain principled causes; teachers are paid to educate their students. None of their employers hire them out of sheer goodwill, for the purpose of putting roofs over their heads, food in their bellies, and clothes on their backs. Those organizations all keep workers on payroll for fundamentally the same reason: to get certain jobs done.

The purpose of paying employees is to compensate them according to the value of the services that they provide to their employers. There’s no better mechanism for ascertaining that value than market forces, which spontaneously aggregate the various factors that determine the supply of and demand for labor: the number of job seekers and competing employers, the amount of specialization and training that are necessary to develop the skills required for the job, etc. As one economist puts it, “Market prices coordinate the actions of billions of people pursuing their myriad goals, by communicating the changing, particular knowledge of everyone about the availability and potential uses of everything.”

In many unfortunate cases, workers’ labor may be worth less than what it costs to live decently in certain locations (especially if the cost of living is artificially inflated by misguided government policies like restrictive zoning regulations). Yet that situation isn’t inherently unjust. There’s nothing about unskilled tasks like flipping burgers, stocking shelves, ringing up purchases, or other menial work that necessarily merits pay generous enough to enable employees to support themselves or their families. That kind of labor is too unspecialized and requires too little training to entitle its practitioners to any arbitrary minimum pay. If you find this pill too bitter, consider how few American workers actually have to swallow it in any case: in 2012, less than 2.8% of the workforce made minimum wage; over half were under the age of 24, and ¾ of them worked part-time.

The idea isn’t that people who can’t hack it on their own should be left in the lurch; it’s just that it’s not their bosses’ job to lift them out of it. Given their institutional character, it makes more sense in principle for governments to provide that support, at least wherever private charity and voluntary mutual aid aren’t up to snuff. For this reason and more, a basic income guarantee of some kind might do the trick better than the minimum wage. It’s also critical, of course, to make educational and economic opportunity as widely available as possible—partly by keeping labor markets flexible—so that people in low-wage jobs can move on up to better-paying work as quickly and as fluidly as possible. Just as consumers are empowered when they can penalize incompetent firms by taking their business elsewhere, workers are empowered when they can respond to sub-optimal pay or working conditions by taking their labor elsewhere.  

For all of that, I’m not opposed to raising the minimum wage under all circumstances; as long as we have the existing system instead of the aforementioned alternative, it makes sense to adjust the minimum wage periodically to keep pace roughly with the rising cost of living. (The key is to avoid hiking it too far, too fast, which would almost certainly cost at least some unskilled jobs.) In the long run, however, the general approach that I advocate here would make a great deal more sense than imposing an arbitrary wage floor, with all the unintended consequences that can come with it. A job is not a social program or a charitable endeavor; it’s a business transaction in the labor market, plain and simple. Your boss’ job is to pay you whatever your work is worth, not to take care of you.

Thursday, December 17, 2015

Memoirs of a Black Princetonian

As a Black alumnus of Princeton University, I'm dismayed at the quality of the debate over last month's "Occupy Nassau" sit-in and the demands made by the Black Justice League (BJL). The BJL and many of its supporters have painted a rather gloomy portrait of a Black and Latino student body crushed under the boot of an unfeeling administration and uniformly seething with racial resentment. I, for one, don't buy this dismal caricature of race relations at my alma mater. My experience as a Black Princeton student in the 2000s suggests that while many minority students there do experience racism and feel alienated from the school's cultural mainstream, a great many others don't.

Mind you, I'm glad that the BJL has succeeded in prompting Old Nassau to confront the issue of race relations on campus. In my day, I heard more than a few Black students express dissatisfaction with Princeton life due to the occasional racial slur, feeling out of place or unwelcome at parties at Princeton’s eating clubs, obnoxious racial attitudes expressed in campus publications, etc. Yet I knew at least as many Black students who felt entirely at home at Princeton; and even those who felt alienated had a number of campus institutions to which they could turn for cultural succor. The Princeton that I attended was not the racial dystopia that many participants in the current clash make it out to be. Furthermore, I doubt that the problems that do afflict the “Orange Bubble” would likely be remedied by the implementation of most of the BJL’s demands.

In 2006, the Journal of Blacks in Higher Education (JBHE) gave Princeton its third-highest ranking among the 26 most selective U.S. universities—and its highest Ivy League ranking—for its record of attracting African-American students and professors. That same year, Hispanic magazine rated Princeton America’s second-best university for Latinos. One African-American freshman, Cameron White ’09, told The Daily Princetonian, "I think the fact that I don’t notice anything negative is a sign that University policies in promoting diversity are effective. I feel like my race isn’t even an issue when making friends." He wasn’t alone.  

I arrived at Princeton expecting to struggle to find my Afro-Caribbean culture represented on campus. Instead, my very first day, a personable Bahamian sophomore promptly introduced me to the Princeton Caribbean Connection (PCC), where I couldn’t swing my arm without smacking a fellow West Indian. That spring semester, I performed on my brand new steelpan at the PCC’s annual “A Little Taste of Carnival” festival. I routinely broke bread with students from throughout the Caribbean Islands and Diaspora; I met two budding dancehall queens and had a classmate who was a veteran of Spike Lee's films; I saw reggae veteran Wayne Wonder perform at Princeton's Carl A. Fields Center for Equality and Cultural Understanding for free.

Such offerings of non-Caucasian culture were not in short supply. There was the “Black and Brown Barbecue” that kicked off the school year; the “Soul Meets Seoul” dinner that united African-American and Korean-American students (and cuisine); the Blacklight Party at the Campus Club (which had a membership commonly described as consisting of “Band people and Black people”) where I celebrated my very first Dean’s Date. The Black Student Union’s Leadership and Mentoring Program (LAMP) paired Black freshmen with veterans who showed us the ropes, helping us navigate the often choppy waters of the Princeton experience. Among my favorite social events by far were the Black Men’s and Women’s Appreciation Dinners each spring, in which gentlemen would treat ladies to a sumptuous formal banquet and vice versa; send off graduating seniors in style; and and salute one another for the roles we had played in each other’s lives.

Beneath the surface, of course, all was not copacetic; I never personally experienced any ascertainable bigotry, but many of my fellow Black students reported not being so lucky. My first inkling of their discontent came during my freshman fall, when my academic advisor asked me bluntly—at the administration's instruction—whether I felt comfortable on Prospect Avenue (the location of the eating clubs). Taken aback, I told her that I felt fine on the drag colloquially known to students as "the Street;" but it soon dawned on me that my experience was not universal.

I learned more about the alienation of many of my fellow Black students after joining the Black Men’s Awareness Group (BMAG) and Princeton’s “Sustained Dialogue” (SD) chapter. One of my SD discussion group leaders once stated that she’d been called a nigger on campus in the past. In online conversations between BMAG members, I heard tales of rejection from parties on the Street. One member told us of the time he’d been accosted by an enraged, drunk white student who accused him of “wanting to screw our [i.e. white] girls.”

Anecdotal or not, such claims of racism shouldn’t be cavalierly dismissed. Casually peruse the comments section of virtually any Daily Princetonian article about racial issues, and you’ll find comments exhibiting contempt for African-Americans and other racial minority groups. It’s not hard to imagine that at least some of that demonstrable prejudice occasionally manifests itself in face-to-face encounters between students or in interactions with faculty and staff.  

Nonetheless, the totality of the circumstances doesn’t clearly support the narrative advanced by the BJL and its supporters. Based on my experiences and those of other Black and Latino alumni whom I’ve consulted on this issue, I strongly suspect that a great many minority students have not found Princeton to be such an “oppressive environment.”   

So it should come as no surprise that I don’t agree with the BJL’s entire reform agenda. I’m not opposed to renaming University institutions named after Woodrow Wilson, though apparently, the exact extent and significance of his undeniable racism is debatable. Yet I can’t support this demand strongly, either, because I can’t see what good it would do. November 2015 was the first time I ever heard a Black student or alumnus voice a grievance having anything to do with Princeton’s thirteenth president. It figures, because Wilsonian nomenclature has no practical impact on any students’ daily lives; it doesn’t directly affect anyone’s grades, job prospects, work loads, or classroom and social experiences.

I'm much more sympathetic to the designation of a room in the Carl Fields Center for Black students than I originally was. When I was an undergraduate, Fields had already provided Black Princetonians with “a place where [they] can have dignity and comfort and engage in self-healing with those who have had similar experiences” (in the BJL's words) ever since its foundation in 1971. Yet it's been claimed that since Fields' relocation six years ago, it has ceased cater to minority students the way it used to. At a campus colloquium last December, Yina Moore '79 stated that Fields is no longer "the cultural center for African-American students," according to the Daily Princetonian. It this is true, then I can see how it made sense for the administration to agree to this demand.

I just can't get behind the BJL’s call for the establishment of cultural affinity housing. The implication that “students interested in Black culture” currently have nowhere to go boggles my mind, for I was never at a loss for exposure to Black culture at Princeton. The Black Arts Company (BAC) regularly enthralled students with African-American dance and theatre; I thrilled to the acrobatic moves of the B-boy crew Sympoh; I remember Black students flocking in droves to Friday night “Black Box” parties (in the insidiously named Wilson College, no less!). I got to see Jurassic 5 and Rihanna perform for free (though I’ve always kicked myself for missing George Clinton’s show); I even got to shoot the breeze briefly with human beatbox Rahzel after one of his two performances at Princeton during my freshman year. I got to see Attallah Shabazz, Malcolm X’s eldest daughter, speak. Not once during my Princeton days did I ever feel “pushed to assimilate into the dominant community by hiding important aspects of [my] identity.”

I also partook of countless other multicultural offerings, from the traditional Mexican dance of Ballet Folklorico to the South Asian dance of Naacho to Raks Odalisque's Middle Eastern dance. The Afrobeat All-Stars, Sensemaya, were perennial crowd favorites at my own Terrace Club, and the springtime "Souk" bazaar brought Jewish and Arab students together to share Middle Eastern customs and cuisine with the campus. I doubt that all those cultural opportunities (and many more) have completely vanished from Princeton in the years since I graduated. I don't see why non-white current students need to be able to live in racially dedicated dorms in order to feel at home on campus.

There's one more dimension to my disagreement with this particular demand. I strongly support African descendants' efforts to build our own spaces, but the more we can provide such spaces for ourselves, without having to depend on white authorities like governments or university administrations to provide them for us, the better. Intriguingly, the Black alumni statement proclaiming solidarity with the BJL seemingly echoed this sentiment: "You should be able to create your own safe spaces and not have [them] ascribed to you." But the BJL is demanding precisely what its alumni allies seem to be inveighing against: the ascription of campus spaces to them by the administration. How can the alumni's laudable appeal for Black collective self-reliance and independence possibly be reconciled with the BJL's demand on its face?

It’s partly because of my belief in open-minded and respectful discourse that I actually support the addition of a diversity category to the undergraduate distribution requirements. I learned a great deal about many lesser-known dimensions of institutional racism in America through my freshman seminar on “The Ghetto As a Socio-Historical Problem” and my writing seminar on “The Race Debate in the Modern U.S.” My classmates came from diverse political and cultural backgrounds, and my professors taught in an ideologically neutral and intellectually tolerant manner, conveying documented facts and allowing us to draw our own conclusions from them. As long as the proposed courses are implemented as impartially and open-mindedly as my past courses were taught, I’m confident that the calibre and tenor of discussion of race relations at Princeton will benefit from them.

Yet that benefit won’t materialize as long as Princeton students continue to denigrate the value of free speech or to cast aspersions on its advocates' motives; to refuse to debate the BJL’s demands on the merits or to substantiate their claims of bigotry on campus; to dismiss arguments against the BJL’s agenda with facile accusations of racism and race treachery; to scorn critiques of the BJL’s tactics as “tone policing” and “respectability politics;” or to lump all darker-complected Princetonians into the same monolithically aggrieved category. I’m not convinced that Princeton is the bubbling cauldron of racial antagonism that the BJL’s rhetoric suggests, or that it is a systematically “oppressive” environment where only white students can get a fair shake. This more nuanced perspective, too, must be be a part of the discourse on the BJL’s demands if Old Nassau is to emerge from the current controversy a better place.

One thing that can certainly be said for the BJL’s ballsy maneuver is that it has prodded Princeton to face up to the race question in an unprecedented way. For that achievement, they deserve their props. Now that that phase of the mission has been accomplished and the debate is afoot, however, I hope that cooler heads and more open minds will prevail from here on in.   

Friday, November 20, 2015

Ain't No Love in the Heart of the Campus

As a recent graduate of Princeton University, I am occasionally treated to e-mail messages from Princeton Pause, which styles itself as “a monthly e-greeting that brings Princeton closer to Princetonians everywhere”. In short, the university tries to avoid becoming too distant a memory in the minds of its departed students, partly in the hope of eliciting generous alumni donations to its Annual Giving program. The latest such Valentine I received featured a short video clip of a speech by the estimable Anthony Grafton—a former History professor of mine—on “what makes Princeton unique.” 

This question has crossed my mind often of late. On the whole, I enjoyed my time at Old Nassau, and will forever cherish the memories and hopefully lifelong friends I made there. In just the past several weeks, I have been pleasantly reminded of the key role my Princeton experience has played in my personal development by sporadic visits to campus, encounters with former classmates and attendance at various alumni gatherings. Yet not until I recently learned of a despicable episode at the University of Massachusetts did I begin to approach answering the question of what makes Princeton unique. 

The episode in question concerns the appearance of conservative columnist Don Feder on UMass’ Amherst campus on March 11th of this year. Feder opposes hate crimes laws as a criminalization not only of acts but of thoughts and beliefs—“hate” being a state of mind rather than a form of conduct, or so the argument goes. This viewpoint predictably incurred the wrath of most of UMass Amherst’s student body. The result was that Feder’s speech, which was sponsored by UMass’ Republican Club, was systematically disrupted and derailed by a swarm of left-wing student protestors. As shown in a video posted on YouTube by a group of the protestors themselves (, the students hissed and booed Feder. Some noisily reversed their chairs to turn their backs to him. One student loudly interrupted his speech with a statement about one victim of an allegedly racist and homophobic hate crime. The harassment mounted to a fever pitch, until Feder finally gave up protesting this unseemly treatment and left the podium. 

The case against this disgrace is obvious—and virtually unassailable. Whatever Feder’s detractors might think of his views, it is beyond dispute that he had a right to express them without intimidation or disruption. Feder’s speech was to be followed with a question-and-answer session in which his student opponents could have critiqued his position as extensively as they liked. They denied themselves that opportunity, however, by effectively running him off the stage. “This is free speech,” cried one young woman in defense of the students’ shenanigans. It seems not to have occurred to her that Feder’s speech deserved to be as “free” as hers and her schoolmates’. 

Are there any circumstances under which the protestors’ actions may have been justified? The only such case I can imagine would be if Feder had engaged in what the US Supreme Court’s free speech jurisprudence has described as “fighting words”: speech that deliberately incites violence or other forms of criminal conduct. Had Feder taken the stage to advocate acts that would have qualified as hate crimes, that would have been a different story. Yet he did no such thing, merely arguing that violent crimes committed for bigoted reasons should be punished in exactly the same way as all other violent crimes. There may be a mountain of sound, rational arguments to make against this thesis. Not one of them was heard at UMass two months ago. 

This, unfortunately, was not an isolated incident. Such nonsense has become more and more common on college campuses across the US in recent years, as political polarization of the American electorate has set in and the American academy has drifted further and further leftward. On at least two occasions in the past several years, African-American advocate Ward Connerly met a similar fate when he took his campaign against affirmative action to the University of Michigan campus. This unseemly behavior, of course, cuts both ways on the ideological spectrum. I still remember with unease the war fever that gripped the US before and during the invasion of Iraq in 2003, and the widespread intolerance for the expression of opposition to the war that came with it. New York Times reporter Chris Hedges, for instance, was forced from the stage by protesters during his commencement speech at Rockford College in Illinois after criticizing the war. Conservative pundits in general were as likely to applaud as to protest such shameful conduct. 

The relevance of these incidents to Princeton’s virtues is no doubt obvious by this point. I have heard of at least one case in Princeton history in which jeering protesters discombobulated an appearance by a speaker deemed controversial by much of the student body. On March 5th, 1970, during President Richard Nixon’s brief expansion of the Vietnam War into Cambodia, almost fourscore antiwar students at an ecology conference in Jadwin Gym heckled Interior Secretary Walter J. Hickel to distraction while then-University President Robert F. Goheen looked on furiously. As far as I know, however, such cases have been mercifully rare within the Orange Bubble. 

In all my time on campus, I recall no such foolishness taking place. From the “Frist Filibuster” in the spring of 2005, to the running battle over abortion waged in the letters section of the Prince throughout most of 2006, I cannot remember any incident on campus in which one or more parties to a debate found themselves bullied into silence. I remember attending a presentation in the spring of 2007 at which anti-abortion advocate Dr. Charmaine Yoest of the Family Research Council gave a speech entitled “How Abortion Harms Women”. Sponsored in part by the Woodrow Wilson School—it was hosted in Bowl 16 of Robertson Hall—this event, as hot-button as its topic was, proved a model of civility. Dr. Yoest’s speech was followed by a Q&A session in which the students—a mostly pro-choice lot that included Sara Viola ‘08, then head of Princeton Pro-Choice Vox—subjected the speaker to rigorous scrutiny and criticism of her views. Through it all, not a sentence was cut off, not a personal attack made, not a voice raised in anger. 

During my time on campus, I heard countless complaints about how politically jaded, complacent and apathetic Princetonians were, at least as compared with their counterparts at, say, Columbia. This criticism was well enough taken by me; but I hope Princeton never travels so far down the road of political activism as to become another UMass or University of Michigan. 

Is it too much to ask that all students at all communities of higher learning show a similar tolerance and respect for opposing viewpoints? Am I to believe that only elite institutions like Princeton can hold their students to this same standard? Surely—hopefully—not. However, if civility and rationality in public (and especially political) discourse, and the free contention of a hundred or more schools of thought, are to remain primarily the province of America’s top-notch universities, that makes me that much more grateful to have attended one of those schools. There are many advantages to a Princeton education, most of which are obvious enough that I need not regurgitate them here. One that usually receives far less emphasis than it deserves, however, is that Princeton is the kind of place where neither Don Feder, nor Ward Connerly, nor any of their ilk would ever find themselves muzzled by an unruly mob—no matter how abhorrent their views might be to the bulk of the student body. 

This does not make Princeton “unique” in the strictest sense of the word—ours is hardly the only university whose students behave so civilly and intelligently. Yet in these politically polarized times, Old Nassau may find itself approaching this kind of uniqueness asymptotically. And you know what? That’s good enough for me.

Thursday, August 28, 2014

Of Markets and Mores

Note: This post is adapted from an essay I wrote in the summer of 2011 that won honorable mention in the Institute for Liberal Studies' "Morality of Capitalism" Essay Contest.
I have not always believed in free enterprise. On the contrary, as a teenager, I looked at the capitalist system with a deep-seated suspicion. From my current libertarian vantage point, I remember wistfully the loathing and contempt with which I viewed the notion that a system of self-interested individuals making free choices could ever benefit the common good. I saw competition between individuals for scarce resources, goods and services as just so much lubricant on the slippery slope to a cutthroat, social Darwinist dystopia. The whole scheme, I reasoned, was immorality at its worst. Greed, selfishness, chaos, mutual sabotage instead of mutual assistance, taking advantage of labor instead of providing for workers’ needs altruistically—all these were strands of a web of vice and perfidy. I sincerely believed that capitalism was simply a sublimation of some of the worst impulses in the human character.
Who would imagine that an illustrated storybook, of all things, would have shown me the error of my ways?
Yet so the story goes. During a visit to a friend’s dorm room in university, I happened upon a copy of cartoonist Gary Larson’s book There’s aHair in my Dirt! In it, a family of earthworms—mother, father and son—sits down to supper. The little worm, discovering a stray hair in his routine dinner of topsoil, explodes into a tirade about the boredom and drudgery of his life as a lowly annelid. A stern Father Worm, seeking to teach his na├»ve son about his true place in the ecosystem, launches into a fable about a young human girl named Harriet who goes for a walk in the forest near her home.
During her promenade, Harriet is awestruck by the beauty of the natural landscape she observes. She is bedazzled by the kaleidoscope of color in a field of blossoming flowers, exclaiming, “I’m gazing at a painting! Oh, Mother Nature! What an artist you are!” She thrills to the sound of songbirds chirping as they wing through the air, interpreting their sweet strains as expressions of good cheer. She coos over two cute young fawns playing in a meadow. She marvels at the “graceful acrobatics” of dragonflies circling over a nearby pond, and gushes over the lights of fireflies dotting the night sky, calling them “the fairies of the night, enchanting the forest with their magical little lights!”
Father Worm, of course, wastes no time bursting the young maiden’s bubble. The blooming flora Harriet witnessed were actually waging war on a “reproductive battlefield”—using their bright colors to compete for the attention of insects, which, of course, bear the pollen those plants need to breed. Those birds belted out their avian aria not to delight human ears, but to communicate with each other—relaying “an array of insults, warnings, and come-ons to members of their own species.” The fawns frolicking in the field instinctively did so not to engage in carefree horseplay, but to form added neurons in their brains, improving their intelligence and thereby increasing their chances for survival in a life in which predators were constant threats. Meanwhile, the dragonflies were engaging in predatory maneuvers, and Harriet’s beloved fireflies were really beetles whose displays of light were the products of biochemical processes used to attract potential mates.
Underpinning all of the sensory delights Mother Nature has to offer is a rough-and-tumble reality: fierce—and often lethal—competition. Moreover, although that never-ending struggle coexists with extensive cooperation between organisms, such cooperation is not altruistically driven. Rather, when living beings assist one another, they receive some sort of benefit in return. As naturalist and author Edward O. Wilson wrote in his foreword to There’s a Hair in My Dirt!, “Nature really is red in tooth and claw. While it is true that organisms are dependent on others, the ecological web they create is built entirely from mutual exploitation. Life is tough! There is no free lunch, and what one creature consumes, another must provide. I know of no instance in which a species of plant or animal gives willing support to another without extracting some advantage in return.”
I remember feeling awed when I first absorbed the wisdom in this simple yet profound parable. I already knew, of course, that in scientific terms, human beings are but the smartest subjects in the animal kingdom. Most, if not all, of our behavior has its roots in our less evolved ancestors’ primal struggle for survival. If the natural world could have spontaneously evolved into this arrangement—this system that was at once based on competition and cooperation, albeit a decidedly self-interested cooperation—without leading to utter chaos and collapse, then maybe, just maybe…
Yet I thought that perhaps the most striking insight in this tale was one left unspoken by the author—indeed, one that may not even have occurred to Mr. Larson himself. Out of the ferocity of competition in the state of nature comes beauty—awe-inspiring, breathtaking beauty of the kind that genuinely enhances our existence and helps make life worth living. The ruthlessness of the battles waged by blooming flowers, prancing deer, chirping birds and luminous beetles should not distract us—and does not detract—from the fact that what they produce is nonetheless wondrous, and our lives would be severely diminished without it. The thing to remember is that without the competition, the beauty would not exist.
Competition, then, leads to beauty—if it is done correctly.
The accordance of human existence with this principle soon dawned on me. Virtually every one of the products and services that we take for granted in our daily lives reaches us through a pipeline laid through a foundation of competition. No architectural marvel would exist without a butting of heads between architectural firms, contractors, engineering companies, and any number of other businesses involved in its construction. Every musical masterpiece is composed by an artist or group of artists who knows how many other such artists are champing at the bit to obtain one of a finite number of available record deals. Every garment is designed by an artisan who comes up with an outfit and a look that enough customers are likely to want to make it a worthwhile investment. In a true capitalist system, every winning competitor gets to the top of the heap by offering consumers an arguably better deal for their money than their rivals do. Competition spurs businesses to pursue true excellence, in the quality and utility of the products and services they offer.
Even when this basic paradigm is violated by misguided, meddlesome politicians and bureaucrats, the reality of competition does not go away. Thanks to the universal reality of unlimited wants and limited resources, that economic clash is inescapable and cannot be banished by government. All such intervention accomplishes is to push that competition into a context in which it is less likely to serve a socially beneficial purpose. Firms that lobby governments to give them no-bid contracts, or subsidies, or tariff hikes to shield them from foreign imports, still have to compete for those cronyistic favors. Unfortunately, instead of competing to give paying customers the best bang for their bucks, they are jockeying for political patronage—the kind that corrupts the political process, swindles their customers by artificially inflating prices, squanders taxpayers’ money and distorts the market beyond all recognition.
No matter what system of political economy a society adopts, competition will always exist, as will any avarice that accompanies it. In countless societies that sought to stifle competition throughout history—from the former Soviet Union to North Korea and Cuba today—one finds that the elites in the uppermost echelons of government power have always claimed material perks and privileges that were unavailable to ordinary people. Moreover, to a large extent, the proof of capitalism’s moral superiority to other economic systems is in the pudding. Fifty years ago, the Soviet Union felt the need to construct a wall through the city of Berlin to trap the people under its jurisdiction and prevent them from getting out. More recently, the US government contemplated building a fence along its southern border to keep out people who were desperate to get in. The voluntary flow of people between capitalist and anti-capitalist societies has always been almost entirely one-way. That stark reality speaks volumes as nothing else can.
The genius of authentic free market capitalism, then, is that it encourages capitalists to engage in the right kind of competition—to bend their energies toward benefiting society instead of plundering and pillaging it. In short, true free enterprise harnesses two unavoidable facts of life—competition and self-interest—for the greater good. There can be no system more moral.