Found a very interesting commentary at Forbes.com this morning, looking into the recent development of more nationalist and protections economies in contrast to the free trade markets. It can be found here (“From flat world to free world”, authored by Yaron Brook), and is worth a look.
Brook starts off with describing the nationalization of some of the South-American economies, as well as Russia’s economy, the last years. Indeed all of it is quite truthful, and Brook himself watches this development with a wary eye.
I too, believe that this development is to be watched with careful and wary eyes. In the wake of the downfall of the Soviet Union the Western economy in many ways opened up, bringing with it economic globalization. As a result the world economy nothing but boomed, especially in the West. However, everything that goes up also comes down – it’s inevitable.
And that’s whats happening now. Brooks describes it like this: “The short answer is: The expanding economic freedom of the past few decades was primarily a response to the bankruptcy of communism and socialism; it was not based on acceptance of capitalism as an ideal. Without such acceptance, recent political advances–despite the economic success they generated–are vulnerable to the new wave of anti-capitalist measures.”
And as is further noted in the commentary in the next paragraph: “Capitalism and the profit motive continue to be viewed with suspicion.“
Despite the success of capitalism and free trade, it’s still seen as morally dubitable by the majority. This was ignored when it was in strong opposition to the declining leftist economies in the world. We were winning, they were losing. Now that there’s no opposition, people become aware that a free trade economy is no bed of roses. There are winners and there are losers, and this unkind fact, although having been quite visible all the time, is suddenly unacceptable for most.
Man is a strange animal that never learns. Even though we’ve already tested the foundation of a nationalist and protectionist economy, and it crumbled, we try again and again to make it work. Because, for some reason, we do not dare to be the cunning (but not heartless) businessman who seeks profit. We dare not win, because we know there will be losers.
The thing is, at least in part, in order to resuscitate our economy we must, as a first step, accept that profit is a morally acceptable goal of business. To be able to pursue profit freely is a premise for economic growth. When a state tries to regulate this pursuit into a form it finds more suitable it hinders this growth – even though it hopes to do the opposite. Instead it tries to split the winnings of one man on hundred men.
What strikes me is: How can it be that one man’s pursuit of profit for himself, is morally unacceptable, while on the other hand, taking the profit of one man, without permission, and giving it to others is deemed morally acceptable? Is it the concept of sharing?
Then, think about this: The profit of one man can indirectly be the harvest of others, through, say the creation of more work. Win-win, without taking what’s his (or hers for that matter). Of course, you can’t expect it to suddenly land in your lap; you’ve got to join in on the pursuit, and the majority are also enabled to do this. For those who then decide to join in, the fruits are good, and for those who don’t – well, what do you expect to get if you do nothing?