The combination
of our educational system's complete abrogation of teaching economics and the
devaluation of enterprise in Canadian society at large has fostered a societal
ignorance of the economy. It is as though the separation of us from human
endeavours associated with an enterprise is possible. The very essence of humanity
is the exchange of goods and services, economics is the medium of expression; a
means by which we can observe the vast complexity of human exchange. The
attempt by many in the world of academics to marginalize the market-based
economy has put us in peril of leaving unexplored the most relevant of human
studies. The financial representation of human reality and its influences
on our behaviour is the most useful of lenses to view the world. Markets, when
properly facilitated provide wealth and prosperity, the wealth and prosperity
that facilitates all the rest of the social complex. The unprecedented wealth we
enjoy in western society today can be squarely attributed to the unique dynamic
that a market-based economy in concert with democracy produces.
The
generalized state of unawareness regarding matters relating to the economy
allows the propagation of policy that ignores the value of the market or worse
seeks to curtail the market as the primary means by which we supply people with
goods and services. The amount of distortion that takes place around economic
policy in the political process is contorting the public’s view of economic
policy in a manner that is detrimental to the country as a whole. So much of
the political process’ address of economic issues is consumed by class warfare;
a particularly pernicious political element, that being people promoting
redistributionist policy. Redistributionists would do better to focus on a
state of generalized prosperity rather than a state of generalized
equality. Rather than taking from
productive people, provide equitable access to a growing pie. The proposition of
paramount importance is, that in order to promote the well-being of people we
need a vibrant economy, and a vibrant economy starts with businesses being able
to respond to opportunity absent distorting policy.
The most
common distortion is the linking of capitalism to negative outcomes related
to displacement, dislocation and exploitation. Capitalism is a means of
exchange ONLY, capitalism if un-distorted by an authority will distribute wealth
broadly. Marx linked the painful events for the working people around the
industrial revolution to capitalism, wrongly. The causes of dislocation and
poverty as the industrial revolution unfolded, were a product of
disequilibrium of labour supply in the context of new technology. This
disequilibrium in concert with the government failing to respond to a changing
circumstance, or perhaps in some cases exacerbating dislocation with policies that exploited the vulnerable, was the cause of the pain experienced by the
working classes.
Capital is a mere abstract representation of human action, if
something bad happened or happens, it is the product of human thought as opposed
to the capitalist process. Capital allows for the aggregation of energy (Capital)
which is fungible, this aggregation of capital does afford power to the holder
and raises the possibility of the power being misapplied. The misapplication of
power happened throughout history absent capitalist processes, and in regimes
that sought to function by eliminating the pooling and use of capital through
central planning, evil happened; evil happened on a grander scale in these
regimes because power was concentrated with one government, instead of a
million capitalists. While capitalism can greatly enhance human progress by
providing a fungible energy resource to apply to any human endeavour, it is
value-neutral – it cares little whether it is directed to good or evil –
remember if you don’t like what you see it is us your looking at. In the
presence or absence of capital processes, evil can occur or the beauty that
resides in humanity can shine. What this document is advocating is enlightened
capitalism, where there is a culture and regulatory commitment to universal
prosperity by giving access to an ever-growing human dynamic.
Social
issues around meeting humanitarian obligations are best met by providing a
floor on human existence and then providing access to the education necessary
for people existing at that floor to progress. The presence of universal
healthcare is mute when universal prosperity is present. Social services are
only relevant when the economy is so poorly managed that people are unable to pay
for the services they need. I offer these statements only to demonstrate how
abundance transforms lives, realizing there is a requirement at present for
social services. The desire to promote a competitive and productive economy
stems from the view that prosperity fosters more prosperity. The key
recognition necessary for people holding redistributionist inclinations is that
the economy is unlimited. The economy can grow large enough to provide
abundance to all people all the time. The abstract element of this realization
is that the economy is detached from the physical world as services represent a
larger and larger portion of the overall economy. When services generate
prosperity the wealth generated may be directed at physical requirements and so
draw on raw resources, but a likely outcome is that wealth will be
directed at services. Read these words, there is no limit to the size of the
economy and the abundance it can provide. As the economy grows, equitable
access brings people off the floor to various socioeconomic circumstances
depending on their abilities, chosen life cadence and circumstance. All it
really takes for this realization to take hold is to concede that abundance is
at least as common as scarcity and that both scarcity and abundance are mental
constructs.
Human endeavour emerges out of
the entire panoply of resources, circumstances and environmental variants.
Human actions in the context of what earth offers reaches unfathomable
complexity, just trying to contemplate the most basic of human endeavours soon
becomes intensely complicated. The Dali Lama teaches a concept called Dependent
Origination, of which one element relates to time, as the origination
of the present is dependent on the past and the future, the present can only exist
in the context of the past and the future. The second element relates to the
physicality and thought of the origination of an item. The example of a clay
pot is used, when one begins to contemplate a clay pots creation, one begins
with the creators' thoughts of the design, the gathering of the clay, the
composition of the clay, the temperature of the kiln, the make-up of the glaze,
the construction of the kiln; as one embarks on this process with one of the humanities most basic and early furnishings, the level of complexity is
staggering. Some elements occur in a state of tacit awareness, knowing what
thought process the pot maker went through in the creation of design is almost
unknowable absent perhaps years of exposure to her actions. Now imagine the process
with a computer, and staggering complexity takes on a staggering complexity. Our marketplace does all this absent any central knowledge bank;
the complexity of human action is managed and valued by each other’s perception
of the value of one good relative to the other. There is absolutely no facility
available to humanity to manage the mass of human action; it simply must emerge
out of the natural inclination for people to engage each other in the context
of their respective needs and desires – people left to their own interests and
good intent will make a million flowers bloom.
Knowledge is
best applied at the point of action. Imagine a circumstance where the
government with all its resources decided that by synchronizing people's food
consumption with a view to bringing better knowledge to the process by accessing
professionals and by standardizing everyone’s meals the government could buy
food in bulk and get it cheaper. You might turn on your radio every morning and
the government representative would provide the meal plan for the day, the
ingredients for which you draw from a box of foodstuffs provided by the
government. Begin the process of dependant originations on this process; it is
impossible to know where to start. How would you manage leftovers, because it
would be impossible for any government to predict the appetite of a given
individual at any point in time? Extra food would have to be provided to ensure
enough for big people even though most people are average, wasteful to say the
least. As one begins to contemplate the government managing our meals for us,
you realize what an absurd notion this is. Yet, in spite of thousands of instances
where central planning has failed, there are people still advocating it as a
solution. Clearly, everyone can see that their lay knowledge applied at the
point of action will generate a more appropriate result than professional
knowledge at a distance. The closer the management of resources is to the
point those resources are actuated, the more appropriate the use of those
resources.
Money
measures and facilitates complex human action. The attachment of value to a
given item in the context of other items or services value can only take place
efficiently with an abstract representation and money is what we use. The more
valuable an item the more of that item gets supplied. All the complexity
associated with the delivery of a good or service is managed by itself as the
spontaneous response to demand occurs. This process is so finely nuanced the
details of value and production and delivery are almost imperceivable. Our
society has been well rewarded for allowing humanity to manage its own affairs
and it's done nary a single central planner, it all happens out of the spontaneous
association of actors. Please though, mine is only one word, take a look around, in every
circumstance where there has been central planning, the government has reduced
the population to impoverishment and subjected them to totalitarianism.
This
position, of allowing humanity's spontaneous actions to determine the action of
the collective still allows for collective action. The critical point in
accessing the value of spontaneous human action as a thought process is to
consider policy creation in the context of the individual as opposed to the
aggregate. Inherent in all human action is the choice of one person to do
something, so this is the logical spot to start designing policy for the collective, in contrast to planning for the aggregate. In this way, knowledge is
best applied and resources are most effectively distributed and utilized. The policy is “planned” in response to human action as opposed to a policy that plans
human action. As stated previously, the sum of human action is impossibly
complex to plan from a central point, to direct the actions of every individual
is a Herculean task even if it were possible, however, a policy can respond to trends
that become apparent from the observation of human action. If provisions are
made for the individual to accumulate wealth then society will be wealthy and
for those who are unable to care for themselves, special programs can be
developed. Policy needs to be directed toward excellence and the outliers
mitigated for, central planning for the aggregate tends to take policy to
manage for the lowest common denominator.
The single
most critical thing for a successful society is the provision for people to be
able to capitalize on their efforts. Karl Marx spoke of this in great detail,
where labour exercised action with the incremental valued-added of that labour was extracted
away from the labour to the extent they remained in subsistence. In an
enlightened capitalist society, we understand, that if we want people to be
capitalists they need to have capital. To the extent generosity (capital) is bestowed at
large is the extent to which prosperity will be accelerated. By provisioning
the masses with capital a virtuous upward cycle moves us from a world view of
scarcity to a world view of abundance. The industrial revolution occurred
absent the ability to manage the displacement that took place leaving people in
an exploitable circumstance, Marx and Engels observed an injustice and we got
communism. The unscrupulous leveraging of capital, over the offer of an honest day's work, created communism; a scourge that has demonstrated its ineptitude at
every attempt at execution and yet people are still promoting it in varying
degrees. I wonder when people will realize the source of the Marxist view and
address it with generosity.
To bring
people firmly to a state of believing in an enlightened capitalist economy they
must see the fruits of others' labour and see the path to access that abundance.
The most effective way for people to progress, assuming they have skills to
apply to occupation, is to allow them a means to accumulate a portion of the
fruits of their contribution to capital. A generous credit policy to purchase a
home is an excellent example of a policy that empowers the individual. A young
couple caught in a circumstance where they are both working to pay rent and to
feed their family is greatly supported by a 100% loan on a home; as it releases
them from the rental trap and puts them on the path of capitalizing on their
efforts. A free education, as demonstrated later, provides the state with
greater revenues and builds human capital reserves and empowers people. Generosity
in human development and empowerment works. As demonstrated so aptly by the
homestead acts, the government gave land and on that foundation, people responded by
accumulating 25% of modern US capital reserves. The key to all successful
economic policy is to seed prosperity with the individual and watch the
collective result.
When
prosperity is seeded with the individual, people are free. When prosperity is
doled out from a central source people are controlled. The damaging precept of
much government policy is one of control. In all societies that focus on
control of people, society entrenches in a state of fixed stratification and
the number of impoverished people grows. In Peru, for example, where the
process to gain property rights is so convoluted that average people are unable
to secure property, impoverishment grows. The backdrop of Peru's policy
development has been one of an elite exercising control; that is the purpose of
complex and convoluted legislation, to facilitate access for the well
capitalized and keep those who are without capital in a ready state of
exploitation. This circumstance happens at the expense of the elite and the general population as well, as
generalized prosperity provides more opportunity for capital use and returns, a
charming paradox. Contrast this with counties like Canada and the US, which
have extended more opportunities to allow access to capital by appropriate rule
of law and effected a more generalized state of prosperity. Seeding the
individual with a generous means to accumulate and access capital is the ticket
to prosperity. The chatter for equality will become muted when a generalized
state of abundance transpires because equality is the language of the have-nots, and talk of equality fades when the consideration is focused on the degree
of prosperity.
The essence
of any government's action must be prudence. Generosity with prudence requires
engaging in generosity in the context of return on investment. In the case of
homesteading, assets that were idle came into action, and people who received the
land paid taxes to governments commensurate with the new assets' value and
infrastructure grew up around them. Government spending must be rationalized to
government benefit in clear terms. Present funding through government rarely is
submitted to the rigours of cost and benefit. The value of a Doctor to the tax
roles is greater than the average, a doctor then represents an incremental
benefit in tax revenue, and the funds provided to the creation of a doctor need to
be rationalized to that incremental benefit. The assertion of generosity here is
in the creation of a value-adding, wealth-generating investment as opposed to
grants without condition.
