Benevolence, Free Enterprise & Adam Smith

Tortoise in this election year has been thinking about free enterprise, socialism and benevolence. Benevolence means the wish as a human being to act with good will. In boning up on Adam Smith, D. Taylor Tortoise has concluded that the economist, though religious, did not particularly see human beings as benevolent. Laissez-faire or “let alone” describes his economic attitude far more accurately than “do good” in matters of livelihood and survival. For example, Adam Smith said, “I have never known much good done by those who affected to trade for the public good. It is an affectation, indeed, not very common among merchants, and very few words need be employed in dissuading them from it.”

Men and women perform their best by simply satisfying their self-interest by making a profit. In the end personal gain benefits the common wealth. To make a bundle brings money to a whole chain of beneficiaries, do with it what they will. “So, Government, leave the job creators alone!”

And yet, even Smith believed that there must be some order to transactions. For example, contracts must be honored and the buyer has a right to accurate information about the proposed purchase. There must be rule of law on these matters. The fact that the wealthy may spend their money on mansions, yachts and other fancy stuff is irrelevant. For the benevolent who would do the public good, they must seek investment by appealing to the moneyed in the capitalist’s self-interest; hence, naming rights for the new stadium, etc.

Civil society requires for the public good, the necessary rule of law. Deciding the public good becomes the bugaboo for entrepreneurs in a putative, free market. You cannot just do whatever you want to make a profit, e.g. steal things, sell bogus mortgages and unsafe drugs. And even Adam Smith did not condone monopoly. He said, People of the same trade seldom meet together even for merriment and diversion, but the conversation ends in a conspiracy against the public or some contrivance to raise prices.” Because of the threat of contrivance, we have set up public utilities to ensure that the optimum, fair market can exist for gas, electrical and communication services. Can you imagine what nightmare a competitive, profit-based army and navy might cause? The interminable debate about the public good goes on.

Which brings Taylor Tortoise to his favorite issues — health care and insurance. Are either of these any less in the public good than electricity or gas?  In the modern age of medical science they are commodities whose consumption in the 21st Century has become totally necessary to survival and the pursuit of happiness. Why? Because miraculous cures and therapies are available, that’s why. Of course, I should add higher education since a college diploma, if not a master’s degree, has surpassed a high school diploma as an absolute necessity. And the so-called free market is failing in both areas. We live in a time when young people are likely to start their careers bankrupt or virtually so under the weight of student loans. Obviously there are no jobs paying enough to make a fair, let alone, free market for either health care or higher education.  The free market demands pricing that works.  Otherwise, subsidy for essential necessities is inevitable; or health care prices itself out of the market consumers cannot afford — a clear failure of competition.

I move very slowly,” says Taylor Tortoise, but even I know change is over due. At the very minimum the public option — once upon a time even supported by Republicans — has become a necessity. And it need not be any more ‘socialistic’ than the power and light company.”

So here we are in 2012, nine months away from Election Day, throwing around epithets about free speech, Euro-socialism, social Darwinism and religious freedom. In the meantime the technocrat Barack Obama, runs the government by executive order. Congress is in permanent recess and vacant mood, it seems. Before John Boehner could stir up his House, the President had already compromised. Thus, there’s little left to do but wait for the next crisis — so much for benevolence. Adam Smith was right. It’s all about self-interest and greed. Democracy is messy.

[Permit me a sidebar before I end. There has been confusion in the past here at The Tortoise Factor. I need to tell you that The Tortoise’s full name is D. Taylor Tortoise. The D stands for Dening, a pleasant enough name, but Taylor Tortoise prefers to be called Taylor. He has also gone by the simple, Tortoise or The Tortoise. He is a benevolent character.]

Steadfast and cautious,

David Milliken





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