George Orwell admonished, “Sometimes the first duty of intelligent men is the restatement of the obvious.” That’s what I want to do — talk about the obvious. Suppose that a person is faced with the choice of spending $50,000 on a brand-new car or paying two years worth of college tuition for his 18-year-old. What is the solution? That’s a stupid question. In the world of economic decision making, there are no solutions — only tradeoffs, where having more of one thing means having less of another. Having one desire fulfilled means having another unfulfilled. For example, there’s no solution to our health care issues. Congress’ health care law simply substitutes its judgment on the delivery of medical services in the name of helping the uninsured. The tradeoff is that Americans have less of something else such as fewer personal choices, less after-tax income and very likely a lower quality of medical services.
How about the criticism that businesses are just in it for money and profits? That’s supposed to be an anti-business slam but upon simple examination, it reflects gross stupidity or misunderstanding. Wal-Mart owns 8,300 stores, of which 4,000 are in 44 different countries. Its 2010 revenues are expected to top $500 billion. Putting Wal-Mart’s revenues in perspective, they exceed the 2009 GDP of all but 18 of the world’s 181 countries. Why is Wal-Mart so successful? Millions of people voluntarily enter their stores and part with their money in exchange for Wal-Mart’s products and services. In order for that to happen, Wal-Mart and millions of other profit-motivated businesses must please people.
Compare our level of satisfaction with the services of those “in it just for the money and profits” to those in it to serve the public as opposed to earning profits. A major non-profit service provider is the public education establishment that delivers primary and secondary education at nearly a trillion-dollar annual cost.
Public education is a major source of complaints about poor services that in many cases constitute nothing less than gross fraud.
If Wal-Mart, or any of the millions of producers who are in it for money and profits, were to deliver the same low-quality services, they would be out of business, but not public schools. Why? People who produce public education get their pay, pay raises and perks whether customers are satisfied or not. They are not motivated by profits and therefore under considerably less pressure to please customers. They use government to take customer money, in the form of taxes.
The U. S. Postal Service, state motor vehicle departments and other government agencies also have the taxing power of government to get money and therefore are less diligent about pleasing customers. You can bet the rent money that if Wal-Mart and other businesses had the power to take our money by force, they would be less interested and willing to please us.
The big difference between entities that serve us well and those who do not lies in what motivates them. Wal-Mart and millions of other businesses are profit-motivated whereas government schools, USPS and state motor vehicle departments are not.
In the market, when a firm fails to please its customers and fails to earn a profit, it goes bankrupt, making those resources available to another that might do better. That’s unless government steps in to bail it out. Bailouts send the message to continue doing a poor job of pleasing customers and husbanding resources. Government-owned nonprofit entities are immune to the ruthless market discipline of being forced to please customers. The same can be said of businesses that receive government subsidies.
The ruthlessness of the market discipline, which forces firms to please customers and thereby earn profits, goes a long way toward explaining hostility toward free market capitalism.
Walter E. Williams is a professor of economics at George Mason University.
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It's great to hear Jesus simple truths laid out so clearly.
Why it's even Reaganesque !
Teach your children well.
Huh? What's "Jesus" got to do with this?
Where does Jesus say "greed is good?"
There's a commandment against using the Lord's name in vain…just a reminder.
Imagine the outcry if private corporations doing business in a particular segment of our economy caused the deaths of over 40 thousand people annually. Michael Moore would make a documentary about it. We would hear about it daily on the news, 60 Minutes, and others. There would be Congressional hearings. There would be a clamor for greater regulation and even nationalization of the industry.
But wait, the industry is nationalized. It's the government owned roads and highways.
the reason we have so many roads is because the government, beginning in the 30s (look up 'Futurama'), and then again in the 50s (National Highway Act), sold out to private automobile interests. Don't blame a 'leftist' for it, it was a sell-out to corporations who wanted to make sure that we didn't have a sensible public transportation system that emits less pollution and would be far cheaper in the long run. Do some research before you post.
Public transportation in a country as spread out as this one is patently stupid anywhere but major cities.
Spending money on silly things like high speed trains has over and over proven to be a sink-hole for money and not well utilized. Even Amtrak in the NE cannot spport itself with fares.
Let me get this straight. The government sold out to greedy automobile interests who now own the roads and highways and are responsible for over 40 thousand deaths annually?
I should think they would be charging me a toll for using their roads. Perhaps they make it up with their unscrupulous advertising which forces me to buy cars I don't need.
While I agree with you that competition generally is better than a subsidy, I cannot agree universally. As you say, everything is a tradeoff. Unfortunately, there are times when the pursuit of profit directly conflicts with our moral duty to our fellow human beings. These are cases where the insurance company denies coverage for treatments that in turn harm the individual. Even though I have a Cadillac health plan, I was recently denied the rest of my physical therapy appointments because the insurance company decided I was better. First, they did not see me in person to decide if I had improved. Second, not only did they stop me from continuing me from full-filling the doctor's prescription, I was told that if I appealed and lost I would lose coverage for this item for the rest of the year should the issue reoccur. Let me repeat. I have a Cadillac Plan. It's from the best company and I/my company pays the most. Yet, my treatment was declined 2/3s of the way through. If a doctor prescribes 20 pills of anti-biotics and the Pharmacist tells you that after 16 you don't need to take any more because you feel better, is that good for the individual? These are cases when greed is not good. The overall effect to society is worse as individuals are less healthy and functioning and thereby contribute less to productivity.
Half-Agree: Of course, you could have paid for the remaining treatments out of your own pocket, but apparently that thought didn't even occur to you.
in fact it did occur to me and i was almost stuck making two payments out of pocket. you know what they say when you ASSUME….
Since health insurance is highly government regulated how do you know this is the effect of the market or the government?
since i work in a highly regulated environment i will tell you that publicly traded companies (in this case a major health insurance provider) work for their shareholders. it's a business not a church.
You didn't answer my question. It doesn't matter who they work for. If they have government mandates or prohibitions, their actions aren't in that case the result of market forces. I ask you again, how do you know that the particular restrictions that you face are the result of the market or the government?
the onus is on you: point me to the government regulation that stipulates that insurance companies MUST deny coverage after most of the treatment was given but not the entire treatment.
No, the onus is on you. You claimed that it was the insurance company solely acting from the profit motive and competitive pressures that resulted in your denial of benefits. Prove it!
I only ask how you know it was market forces and not government regulation. I have not made a claim.
because they told me that over the phone and said it was not due to regulations.
Is this health insurance you got through your employer?
Keep after 'em, JasonPappas. "They told me over the phone" isn't terribly trustworthy.
Thanks, Kathy. I was hoping Half-Agree would give me a chance to challenge his belief that insurance isn't regulated. The local clerk answering the phone (perhaps in India) may not be the person to explain insurance regulations. LOL.
I admire your persistence.
When I'm confronted with such a lack of emotional intelligence I tend to say "Oh, heck with it" and move on. That's not the way to win.
Glad you're on my side!
Greed is part of our nature and does have a positive roll but has to be pruned and controlled or it becomes destructive. You are manifesting one facet of greed in your own complaint. Our Bible has a lot to say on this point and we don't think those instructions pertain to us but they do. Profit and property are a right but they can both be abused. Competition goes a long way toward keeping the price down but when we do away with profit and/or property rights we also do away with the supply.
If your insurance company can't make more than it has to spend it goes out of business. Why do you have insurance in the first place if not to defray your medical expense to a more comfortable level but it is not free medical care as you seem to think. Therefore they must put limits on their liability and that is usually stated in the contract.
Williams’ efficency argument is valid but doesn’t get to the heart of the matter.
Even with the lower quality per dollar, public education gets the voters support. My town won’t decrease its support to public education despite the dire financial straits of the town and state. Teacher jobs are sought after because of the compensation, free time, benefits and lifetime security. Why does such an high-cost, uncompetitive, lower performing institution survive?
Most parents in our town don’t want to pay for their children’s education. They want others to pay and they don’t care how much it costs. They believe they’re entitled to other peoples’ income to support their children. There is little sense of honor or sense of pride in America today. Honesty, self-reliance, and respect for the rights of others were once core American values. Our problem is an ethical disintegration. Bad economics is the result.
I don't like where you may be going regarding teaching jobs, but I think you've hit half the nail on the head regarding education.
Education begins and ends with parents. Unfortunately, many people seem to think that because they were students 30 years ago, this makes them experts in education. Public education does not have the luxury of self-selection–it has to educate EVERYBODY. Therefore, teachers are often asked to do the impossible: trying to educate your gifted kid AND the behavior-disorder, broken home kid of a the drug addict across the tracks. (cont'd)
That said, your second paragraph says it all. While I think it is in this nations interests to have an educated population, education-as-entitlement has really sunk in. People just assume a school is going to be there to raise their kids. I am all for some sort of mandatory tuition–even in public schools. You want to have a kid? You'd better be prepared to pony up for their schooling. You'd better be prepared to invest in that education. And that way (hopefully) you'll be motivated to look for what sort of return you are getting.
Yes, that's the main point.
The important point is that we are deprived, as individuals, of the choice on how to spend our hard earned money. Whether we get our money’s worth or not, it should be our decisions as individuals. Let us decide how to run our lives and manage our families.
But with liberty comes responsibility. It's our responsibility as parents to educate (house and feed) our children. It part of the choice to have and raise children.
True. By the same token, we're kidding ourselves if we don't think our hyperconsumer culture hasn't contributed in some ways to this decline. Selfishness, acquisitiveness, expectations of instant gratification, and dumbed-down media (can't be too intelligent because we need to sell ad spots) are a side effect of this culture.
This is not to say consumer culture is "bad," or that government should do anything about it. Just being realistic about what has happened to our culture, overall, in the last 50-60 years. Greed is Not Good–by definition.
Obvious indeed. The liberal notion that profits are usually an indication of bad behavior is so counter-intuitive that I can only conclude that no one on the Left has ever invested their money or has ever run their own business. Why we let the financially clueless into our government systems is beyond me.
Arguing against Williams is equivalent to arguing against Newton’s laws of motion. A young inexperienced engineer upon observing a complex machine for the first time might not understand the actions and reactions of all the moving parts. The stage magician who seemingly floats a body in mid-air convinces his audience that he has discovered ancient secrets that defy natural laws. But in all cases, when the moving parts are accurately evaluated, it is discovered that natural laws are adhered to without exception. If you think you’ve found an exception, then you haven’t accurately evaluated
Millions of American parents have, when they can afford it, chosen to send their kids to private or parochial schools, or even homeschool them (which is an incredible feat and burden) because they don't want their kids indoctrinated with collectivist ideas or dumbed-down to the intelligence level of an amoeba. In short, they want their kids to succeed in life, and in far too many communities, the public school institution just isn't producing even minimum results. Countless recent studies have shown that American students rank well behind western counterparts in math and the sciences. Also, millions of kids graduate high school but, colleges say, cannot adequately spell or even write complete sentences, and cannot understand why they can't do these things because their reading comprehension is also abysmal. They are embarassingly arrrogant with an inflated opinion of themselves and lack even the rudimentary ability to make the proper change in McDonalds unless a register tells them how.
The parents that choose those options do so because the mere charging of tuition has a way of weeding out parents who couldn't care less. Your kids are more likely to have classmates where a modicum of achievement and good behavior is expected.
Having been the product of both parochial and private education, and my kids as well, I can tell you there is not much difference in curriculum or in teaching skill between the public and private. The difference is solely in parental interest and attention.
Public schools get a bad rap because, as I've said, they have to serve EVERYBODY. They are not self-selecting. They have to educate the gifted kid and the kid who's got no one at home to help him. That's a HUGE task. I do think going to some sort of tuition-based, quasi-market system could help.
Greed elevated to a virtue , WHERE'S GEKKO ?
Whatever happened to plain old buisiness ethics driving a company ? And the work ethic driving the worker .
All I've heard in the above posts, including the ludicrous editorial , is nonsense and drivel . It makes no difference whether the entity is private or governmental [like the Post Office ]
You folks like to attach your political spin on everything under the sun . No ,GREED does not bring happiness , what an ASSININE NOTION .
You must have a govt. job, or or you just happen to be on your break at your local Blockbuster. An entrepreneur you're not.
It makes no difference whether the entity is private or governmental??? I can't begin to list everything wrong with that statement–it reveals a complete lack of fundamentals on how economics work. Thanks for being our living example of why the U.S. economy has become to stunted.
That Is true who could list all the wrongs in private or governmental! we the people will be slaves soon some are already now! why do you think illegal immigration is such A threat to the Big Boys Club? If to much exposed The greed would end and rot the Weed! weeds are ugly always pretending to be something when they are not!
What is ludicrous about the editorial, badaboo? What facts of his argument do not hold water?
And what is "nonsense and drivel," specifically, please.
"You folks," you mean people who believe in the free market, limited government, and the rule of law? You mean us people?
Dr. Williams has again posted a compelling and factually correct argument for liberty.
Sorry tar_n_feathers , you couldn't have handled the jobs I've had in my lifetime , and you're not talking to one of your fellow idiots . Working a coal truck as a kid shoveling coal down shoots , joining the Merchant Marine as an able seaman , getting my mates licence , a stint in the army -14 months in Vietnam , then 7 years repairing ship containers and chassis , and about to cap of a 30 year career climbing poles , dighging up tel.cable . You're nothing more than a scrub , wet behind the ears , who couldn't survive a week on a merchantmen .
Dont try to put your bullsit political spin on greed , because it's bullshit , greed in many cases KILLS , not to mention , abvuses and robs other human beings . Go sell that line of bullshit to someone else .
The US economy is in the shapes it'sin DUE TO GREED , in almost every aspect , Detroit moved operations overseas , the "entrepenuers " who invent new products , the FIRST STEP after their patent , is to look for some slave labor to mass produce their product , so it could be sold back to us , Americans .If Lori and mr. tar were indeed intelligent enough to attend any of America's great buisiness schools , even though most of our "wonderfull students " abandon it even befiore they graduate , they /you would have learned thyat buisiness large or small have a responsibility to be successfull , efficient , ETHICAL , and along with it , bear a responsibility to the company itself , it's employees , it's customers and clients , and to the communities they serve and operate in , also the communities the effect .
So both your statements indicate an ignorance and lack of education in buisinees , and I doubt you're even capable of attaining an assoc degree . I'm no MBA , but I know several , and although they may abandoned or forgot , they would be remiss not to acknowledge that buisiness ethics as the one I've mentioned are an integral part of the courses required to obtain those MBA s. GREED was NEVER a part of those courses .NOR IS IT NOW . So take your notions of psuedo-buisiness knowledge and FLUSH IT where it belongs …in the toilet .
And as far as "the Big Boys Club " , illegal immigrants are in fact desired by thgem , lower wages , abuse of employees , in fact some of the big chain restuarants , have been busted instructing and encouraging managers to hire illegals …so WHO are you kidding Lori ?
Wanna end illegal immigration TODAY ?
A $50,000. dollar fine for every illegal or undocumented found in a buisiness' employ , it would end YESTERDAY .
But do you think that would ever be legislated ? You're damn right it WOULDN'T , and you damn well know why .
Both of you are hypocrites or so poorly informed and unaware of what's going on , that you qualify for stupid ……and you can't fix stupid .
Anyone who puts a positive connotation on GREED ,which BTW goes hand in hand with AVARICE is an amoral idiot , so if the "shoe fits …wear it "
There's more than just monetary greed. Greed for power feeds the political tyrant who is typically leftist.
That's right, greed is bad no matter what. But this article focuses on business and tries to revive the evil canard "greed is good."
Yow, I feel like I've just been told off by my cranky old Uncle Murray. He had anger and resentment issues and I don't think he was ever happy. He spend a lifetime lashing out at others he held responsible for his own shortcomings. And he went to his grave believing that a cruel and unfeeling world had denied him what was justly his. Always had to get the last word too.
forget the psuedo-psychology mr.tar&feathers , I just recognize bullshit when I see it . It never ceases to amaze me , at what absurdities are blurted out for the sake of political agenda and ideology .
Forget your uncle Murray and just think about the title , ….you know for more than two milli-seconds ….if your attention span allows ….. "Greed and the Greater Good "???
Think about that man , you've got the ability to compose a sentence , you should be able to see what a morally bankrupt notion that is , even your uncle knew that , and maybe because he had a nephew like you, is what really pissed him off .
Tar and Feather, Get It Together! The truth hurts and pierces like A two Edged Sword! All of us need to get The Tar off our feathers, So maybe than we can work together! Are you willing?
I'm not sure what you're talking about. What truth? Work together on what?
Shame sham, badaboo. Art thou annoyed? Such name calling.
No need for self-loathing here. Just be yourself. It's oh-kay.
This isn't a serious defense of capitalism, but I don't think you can do that in a single column. Capitalism is good when good, ethical people are engaged in it–but then, what economic system can't that be said for? Greed, by definition, is bad. Ambition is good. Sometimes they go together. Sometimes they go too far. Until you're willing to discuss when they go too far, this isn't a serious discussion.
I tend to agree that capitalism is an economic system most compatible with human nature and liberty. But Wal-Mart is a poor example to use. Wal-Mart in many cases is litle different than the "company store" of yesteryear–the behemoth who drives local retailers out, then employs the remainder, then recoups their paychecks by selling them cheap goods. As a multinational it has no loyalty to country, but huge access to government, where it enjoys the same "speech" rights as any individual. That's got to stop.
It is quite true that Wal-Mart has been successful in outcompeting other stores which sell the same products, such as toys, clothing, and groceries. But how has it been able to do this? By discovering new ways of using computer systems and other technology to better manage its inventory and costs and reap the benefits of economy of scale. Wal-Mart is especially popular among low-income shoppers who cannot afford the prices of the more upscale stores. It has put other stores out of business, but that is the way capitalism works. It is also true that Wal-Mart pays lower wages than many unionized stores. But it must offer a market wage or risk its employees going elsewhere, and it deals with employees on a voluntary basis. Those who do not like its terms are free to do business elsewhere. This makes the company especially hated by "organized labor," such as the grocery unions. By coercively restricting the supply of labor, these unions, backed by government laws and regulations, have been able to extort wages and benefits far above those which would exist in a truly free labor market. In a free market, how many people doing relatively unskilled work would get $17-19 per hour plus full medical benefits?
You can make a case against the problems unions create–I think of the auto industry and to some education off the bat–but we should acknowledge that the unions grew the middle class which is the backbone of our economy. Ironically, without them, the "Road to Serfdom" would have come that much quicker.
Results of greed ? no need to look any further than your nose …..or your beaches if you live on the Gulf . Very few big companies are "voluntarily responsible "citizens ' , unless they are forced by regulation to be . Just as the people of Valdez , no the Exxon Valdez didn't have to have a double-bottom hull , but any one in the industry recommended it to prevent such mishaps and subsequent disasters following an accidental grounding . In fact THAT was one of he industries "promises " when completing the pipeline …but "promises are made to be broken " …and they were They also had "promised " to have an INPLACE capacity to handle such a case …..but didn't .
And when it was allover , Exxon got off with only paying 1/500th of what they were sued for …..and Alaska ? there's oil in the sand and rocks of over 230 streams which werre salmon migration streams , the ffects , still persist to this day .
Yea …that's where greed will get you .
As for Walmart ? They've already been cited for just not offering any plan for medical benefits , but for recommending it's employeres seek state , municipal or county assistance ….yeeeeaaa , Great American Company . But hey , if you're a stockholder what the hell do you care , as long as you get your dividends .
That's right–we're a nation of stockholders now, not citizens. To show how far we've fallen, this article cites "greed for the greater good"–an Orwellian construct if ever there were.
So the gravy train is over. It was fun while it lasted, right? It's quite clear that we are at the beck and call of huge multinational conglomerates with NO PARTICULAR LOYALTY to any nation–but with unprecedented access to OUR government (see Joe Barton's apology to Tony Hayward–that's your government looking out for you!)
This is not about simplistic "corporations are evil." Most corporations are lawful. This is about the level of corporate power now over individual power–the degree to which it has seeped into government.
Step one: Corporations are not individuals, nor should they have the same rights as individuals.
Step two: campaign limits