I’ve accumulated more articles on economics from the early days of the U.S. than have had time to comment on. Here is some more reading on the role private property played in early America.
Hope to roll these into longer discussions in the future. Until then, check out: (more…)
If it was possible to choose, would you prefer to live life in the middle class, struggling to get by in a lousy economy with an uncertain retirement, or would you rather live the life of Nathan Rothschild, who was the richest man on the planet when he departed this life in 1836?
(Cross-posted from my other blog, Outrun Change.)
John Kay discusses this idea in his article, Precise inflation figures ignore evolutions in product quality and consumer choice.
Mr. Kay points out that Mr. Rothschild was richer than either John D Rockefeller or Bill Gates. He was the second richest man in all of history.
Before you say you’d rather live his life than yours, consider this:
There is a concept loose in the U.S. and emphasized in our educational system that the Puritans arrived in the U.S. believing in capitalism and went straight to economic prosperity.
Well, capitalism will definitely do that, but the Puritans made a few stops before getting to prosperity. Those included socialism, price controls, and severe caps on finance & trade under the guise of opposing usury. All of those policies will suppress economic development.
Jerry Bowyer explores this journey through false ideas is a series of articles, which summarize his interview with Mark Valeri, author of Heavenly Merchandize.
To encourage you to check out the full articles, I’ll try to summarize some key ideas.
7/30 – Forbes – Jerry Bowyer – Puritans vs. Capitalism: How A Theological Error Led To Financial Stagnation – In the 17th century, pastors and religious leaders were opposed to usury which included even discounting letters of credit more than a small amount. If you can’t use paper (bills of credit) to facilitate long-distance trading, there won’t be much trading.
At the most foundational level, capitalism is moral.
The only way to succeed in the long-term is to treat customers well and honestly. That will provide money to the company to continue paying staff and vendors as well as leaving a profit for owners.
If a company does not deliver a quality product or service that customers value with higher utility to them than the cost to provide by the company, then the company won’t be around long.
At the core level, it is moral to satisfy your customers with profit left over.
CPA Ron Baker makes this point more eloquently than me in his LinkedIn article, Are Corporations Socially Responsible?
By the way, the answer is yes.
(Cross-posted from my other blog, Attestation Update.)
If a corporation provides value to customers, both the company and customer will be better off after the transaction than before. That is a positive social value.
Doing so, within the framework of the law (as Milton Freidman points out) is the duty of a business and it is also highly socially responsible.
Consider the following two stories.
One country with rapidly expanding oil production with no end of the increase in sight. The other country is a member of OPEC and will start importing light crude.
I’ll ask two questions after mentioning the articles, which are reposted from my other blog, Outrun Change. (more…)
The following discussion is cross-posted from my other blog, Outrun Change. Why do I copy it here? Because at a foundational level, the radical increases in health, safety, and prosperity that started about 200 years ago are at the core a moral issue. I firmly believe it is a fundamentally Read more…
Creative video from Prof. Bryan Caplan explains Make Progress, Not Work.
[youtube=http://www.youtube.com/watch?feature=player_embedded&v=fEbdgpIQ7n4]
(cross-post from Outrun Change.) A few highlights:
Why we are so much better off than 200 years ago? Explained in 3 minutes. Check out the video by Prof. Dierdre McCloskey:
[youtube=http://www.youtube.com/watch?v=a0nsKBx77EQ&feature=player_embedded]
(Cross-posted from my other blog, Outrun Change.)
Here’s my 200 word summary of the video:
Until 1800, the average person made the inflation-adjusted equivalent to $3 a day. It’s been that way for thousands of years. Starting in 1800, a graph of average income looks like a hockey stick, going almost straight up after being flat for thousands of years.
Why?