How Wealth does not Work
How Wealth does not Work
Does wealth help the masses?
P. J. O'Rourke (Reader's Digest, October 1998, p. 169-172) missed his own point. He states: ‘The free market - not just in America but around the world - means that people have an innate right to fruits of their labor and the right to dispose of this fruit the way they see fit, as long as other people don't get pasted in the face with a rotten peach or something.’ One can never get rich without pasting rotten peaches in the faces of their employees and customers.
We, the hated liberals, recognize the innumerable ways in which the poor as well as the middle class get pasted in our faces with many extremely rotten things when some people get rich.
People can get rich only by charging exorbitant prices for their goods and services thereby maximizing their profits. To that extent they do paste ‘rotten peach’ on the face of their customers who have now less money left to fulfill their other needs. If, for example, a landlord charges, say $50, more than the reasonable rent to his fixed income tenant, that family will have to forgo enjoying the fruit of their labor worth $50 of food, clothing or some necessary item. If this is not pasting rotten peaches on others' faces, what else is? The rich and their protagonists like the Reader's Digest find it very convenient to ignore this very dirty aspect of the creation of wealth. In stead, they keep demanding lower taxes for the rich.
The other improvements in peoples' lives which O'Rourke credits wealth with would have been much better and much larger if the people were not victimized by the investors and traders who have no nationality, religion or even conscience. They would even trade with two mutually warring groups to make money out of the conflict.
There are valid strong reasons why a camel may pass through the eye of a needle but the rich will not get through the gate to heaven.
Nevertheless, we need not abandon capitalism. But we do need to replace the devil in it with God. Here is how:
We must realize that God gave us intelligence to serve the mankind and not to exploit it in the guise of ‘Intellectual Property Rights.’
We must stop glorifying greed, which is as bad as envy that was glorified by communism. Greed and envy are human instincts but so are others, which we control for being civilized.
‘Might is right’ was the barbaric law. ‘Financial might is right’ must not be the new law.
Profit, by itself, is not bad. Maximizing profit by any means is, however, an extremely despicable ungodly practice. Returns on investment must be limited to a moral and ethical value of about 10 %.
Prices must not be based on ‘whatever market bears.’ They should be based on the actual costs to the supplier plus the 10% profit.
‘Buyer beware’ is the most disgusting way of treating the customers and creating wealth. People do not have time, opportunity or ability to keep bewaring in making all their purchases. Competition doesn't always exist. Sellers must accept moral responsibility and stop cheating the buyers.
Government must not interfere with the market forces. But it must insure that no body else maneuvers the markets or cheats the consumers.
Profits in excess of 10% must be shared among not only the investors but also the customers (lower prices), the employees (better wages) and the nation (tax surcharges).
Stock markets must be dampened. There must be a national sales tax on all transactions on the stock markets. Those who make money without doing any real work ought to share more of it with the society than paying income tax only.
On all international transactions there should be a sales tax, the proceeds of which can at least partly fund the United Nations.
People who live by the market shall also perish by the market unless it abides by God's principles. Market, after all, is a very irresponsible entity.
Companies are run by people whose only duty is to maximize profits. Government is controlled by people's elected representatives. It is therefore unwise to trust markets more than the government. We need both to be equally strong and to complement each other.