Unearned gains destroy people, nations, and teenagers. If you want to help, go into the dark places of the world and open stores that offer lower prices
I happen to agree with your poorly phrased objection—I happen to think that “personal responsibility” is mostly bullshit, and often a dangerous cover word for collective indifference and the just-world fallacy, much like “equality of opportunity”, “self-reliance” and other applause lights—but please elaborate!
As far as I know, the conservative/right-libertarian argument against giving people in desperate need (e.g. Africans) “unearned” aid is that it doesn’t just offer perverse incentives and degrade their society’s mindset—it doesn’t even lead to improved material conditions either, as birth rates, structures of supply and demand, etc would make things as bad or worse down the road. However, I’m very unsure if that criticism true for many aid programs like basic education, healthcare, monitoring (or experiments like OLPC and the proposed wind/solar energy systems for Africa) - it sounds plausible for agricultural “aid” and other charities that replace the local economy—so it might be a case of taking true evidence in a few specific cases and applying it indiscriminately to all “interventionist” social projects for a fully general “libertarian” counterargument. It’s a commonly seen political dynamic, IMO: left-liberals follow some naive do-gooder sentiment to do something stupid/counter-productive (and often go in denial if it blows up, like decolonization); then their cynical/unscurplous opponents cite it as “evidence” why doing nice things for altruistic reasons is always Worse Than Hitler, and develop it into a general indictment of the altruistic/”socialist” mindset, a la Ayn Rand or… certain other writers.
Largely yes (I would also note efforts like GiveWell that try to document positive effects of charity).
But I quoted the second sentence for a reason—and that reason is because it could have strong negative impacts (outcompeting local businesses, leading to economic instability at least and prolonged poverty at worst), but that’s not considered at all. So we have charity in the first sentence, eyed with skepticism and doubt, and then we have business in the second sentence, jumped into uncritically.
Seems like a good heuristic could be: “don’t do for Africans what Africans can do for themselves; instead do the things they can’t do for themselves”. Though in reality it gets messy: what if they can do X, but can’t do enough X? By providing additional X you compete with those who already provided X.
Even better, every provided help should employ local people where possible. For example, you bring the food help to one place, and then pay local people to distribute it to other places. But pay them a market rate only. (You are already increasing local wages by increasing local demand for labor.)
Similarly you could improve healthcare by providing free education to local doctors, and then let them sell their services to their customers. (The more doctors you teach, the greater competition will be between them, and their services will be cheaper.) The same for teachers.
All these suggestions seem to me fully compatible with the “traditional capitalist values”. And if this happens to be sponsored by voluntary donors, even Ayn Rand wouldn’t object. -- So if someone objects against this, citing “libertarian” arguments, either they are mistaken, or that is not their true rejection.
Surprised that ‘unearned gains’ and ‘stealing’ have many of the same effects? Or do you somehow think that those two statements are intended as a justification/imperative pair?
That first one is bad mindreading—not bad because it’s unsuccessful, although it is (mindreading is dang hard though, so like I said, I don’t care). But because it’s written from your point of view. If you’re trying to mind-read, you should end up with something that’s written from the point of view of your model of the other person.
The second guess is closer. Here’s my take:
The consequences of charity are examined with skepticism and generalization, and then outcompeting local businesses is immediately proposed as a solution with no thought to the consequences. Each of these parts has their own problems, but writing them one after the other like that is bad out of proportion to the sum of the parts. Thus, *explosion noises*.
I was drawing on my model of another person- but my model was based on so little information that it was very likely to be wrong.
Building on ewbronv’s response: The starving man is best off if you open a bakery which can profitably sell him bread at a price he can afford. If there are starving people, it is because food is not available at a price they can afford.
It isn’t about driving other companies out of business, it’s about meeting an unmet need. If you can make a greater profit than the free market competition, it must be because you are filling needs more effectively- everyone who would have their personal needs filled more valuably by the competition patronizes the competition, driving their profits instead of yours.
Building on ewbronv’s response: The starving man is best off if you open a bakery which can profitably sell him bread at a price he can afford. If there are starving people, it is because food is not available at a price they can afford.
Right. So I am saying that businesses can affect both the price, and the affording.
In a trade balance sense, where imports are perceived to reduce the economic viability of an area and exports are perceived to increase it? Or are you saying that businesses that pay low wages are harmful compared to businesses which pay high wages, sell the same amount of the same product (at a higher price), make the same profit, and distribute that profit the same way?
The trade balance perspective is a pretty interesting one :P If the locals spend money at your store, how does it get back to the locals so they can buy more stuff? Is the entire cycle good for the locals (typical import/export), or is there a tragedy of the commons problem (the people hurt aren’t necessarily the same ones who shop at your store)?
But what I was mainly thinking of was labor distribution. The economy is (from the pragmatist perspective) a system for distributing goods and labor to where they’ll benefit people, better than a central planner could do it. If goods were previously produced locally, and now you import them, that’s not making the distribution of goods worse, but it can make the distribution of labor worse, imposing costs on the local economy. Moving people around is a pain.
The store hires locals to man it, and pays taxes at the local rates. The local currency (henceforth: lc, symbol #) can only be exchanged for foreign currency (henceforth: dollars, $) if there are things which can be purchased using the local currency that people who have foreign currency want. If the lc isn’t worth anything, nobody can make a profit buying bread for dollars and selling the bread for lc.
I think that it is overwhelmingly likely that the areas with the highest unemployment will have the lowest labor costs; If that is the case, the businessman imports wheat into that area, bakes it using local labor, and sells it in lc; he has now changed some amount of dollars into some amount of lc. He then invests that lc into a labor-intensive product and ships that product back home to sell for dollars.
Exactly the same thing can and does happen within a single currency: raw materials are shipped from where resources are plentiful to where labor is plentiful, and finished goods are shipped back out. The major hurdle is scarce raw materials limiting the number of factories that it is possible to operate, followed by political control of the economic system in order to ‘keep jobs’ within the privileged group.
On the contrary, a capitalist believes there is abundant evidence that increased competition in any market almost always generates positive externalities, and is a net benifit to the community. Endless volumes have been written on this topic, and while there have been some attempts to argue the opposite case none of the ones I’ve seen are especially convincing. So ‘open a business instead’ isn’t a thoughtless reflex, it’s a carefully considered opinion about what course of action has the highest likelyhood of generating positive results in an uncertain world.
The first half, of course, is a lot less firmly supported. While unearned wealth certainly has a tendency to produce negative side effects, there isn’t a lot of hard data on how strong this trend is. Certainly, it seems hard to argue that a starvig man is worse off if you give him a free loaf of bread.
Of course in reality it generally isn’t possible to give large amounts of resources to the needy, especially in poverty-stricken nations. Whever you try it the local kleptocrats will quickly arrange to steal the majority of your donations and use them to maintain their own power, so the real effect of most international charity is simply to prop up corrupt regimes and allow them to get away with oppressing their own people.
On the contrary, a capitalist believes there is abundant evidence that increased competition in any market almost always generates positive externalities, and is a net benifit to the community.
Hm. Well, this is reasonable—competition is pretty nice. But if you have a society that’s just plain old less efficient than ours—uses lots of human labor rather than industrialization, doesn’t have good economies of scale, etc etc—and I go in and open up some store that simply offers lower prices on widgets than the local stores can offer, this doesn’t particularly increase competition. The other stores aren’t going to build economies of scale overnight, they simply go out of business, and so now I have all the local widget sales.
So ‘open a business instead’ isn’t a thoughtless reflex, it’s a carefully considered opinion about what course of action has the highest likelyhood of generating positive results in an uncertain world.
AIIIIIEEEEEEEEE pschbschchch*explosion noises*
I happen to agree with your poorly phrased objection—I happen to think that “personal responsibility” is mostly bullshit, and often a dangerous cover word for collective indifference and the just-world fallacy, much like “equality of opportunity”, “self-reliance” and other applause lights—but please elaborate!
As far as I know, the conservative/right-libertarian argument against giving people in desperate need (e.g. Africans) “unearned” aid is that it doesn’t just offer perverse incentives and degrade their society’s mindset—it doesn’t even lead to improved material conditions either, as birth rates, structures of supply and demand, etc would make things as bad or worse down the road.
However, I’m very unsure if that criticism true for many aid programs like basic education, healthcare, monitoring (or experiments like OLPC and the proposed wind/solar energy systems for Africa) - it sounds plausible for agricultural “aid” and other charities that replace the local economy—so it might be a case of taking true evidence in a few specific cases and applying it indiscriminately to all “interventionist” social projects for a fully general “libertarian” counterargument.
It’s a commonly seen political dynamic, IMO: left-liberals follow some naive do-gooder sentiment to do something stupid/counter-productive (and often go in denial if it blows up, like decolonization); then their cynical/unscurplous opponents cite it as “evidence” why doing nice things for altruistic reasons is always Worse Than Hitler, and develop it into a general indictment of the altruistic/”socialist” mindset, a la Ayn Rand or… certain other writers.
Is that your take as well?
Largely yes (I would also note efforts like GiveWell that try to document positive effects of charity).
But I quoted the second sentence for a reason—and that reason is because it could have strong negative impacts (outcompeting local businesses, leading to economic instability at least and prolonged poverty at worst), but that’s not considered at all. So we have charity in the first sentence, eyed with skepticism and doubt, and then we have business in the second sentence, jumped into uncritically.
Seems like a good heuristic could be: “don’t do for Africans what Africans can do for themselves; instead do the things they can’t do for themselves”. Though in reality it gets messy: what if they can do X, but can’t do enough X? By providing additional X you compete with those who already provided X.
Even better, every provided help should employ local people where possible. For example, you bring the food help to one place, and then pay local people to distribute it to other places. But pay them a market rate only. (You are already increasing local wages by increasing local demand for labor.)
Similarly you could improve healthcare by providing free education to local doctors, and then let them sell their services to their customers. (The more doctors you teach, the greater competition will be between them, and their services will be cheaper.) The same for teachers.
All these suggestions seem to me fully compatible with the “traditional capitalist values”. And if this happens to be sponsored by voluntary donors, even Ayn Rand wouldn’t object. -- So if someone objects against this, citing “libertarian” arguments, either they are mistaken, or that is not their true rejection.
Surprised that ‘unearned gains’ and ‘stealing’ have many of the same effects? Or do you somehow think that those two statements are intended as a justification/imperative pair?
That first one is bad mindreading—not bad because it’s unsuccessful, although it is (mindreading is dang hard though, so like I said, I don’t care). But because it’s written from your point of view. If you’re trying to mind-read, you should end up with something that’s written from the point of view of your model of the other person.
The second guess is closer. Here’s my take:
The consequences of charity are examined with skepticism and generalization, and then outcompeting local businesses is immediately proposed as a solution with no thought to the consequences. Each of these parts has their own problems, but writing them one after the other like that is bad out of proportion to the sum of the parts. Thus, *explosion noises*.
I was drawing on my model of another person- but my model was based on so little information that it was very likely to be wrong.
Building on ewbronv’s response: The starving man is best off if you open a bakery which can profitably sell him bread at a price he can afford. If there are starving people, it is because food is not available at a price they can afford.
It isn’t about driving other companies out of business, it’s about meeting an unmet need. If you can make a greater profit than the free market competition, it must be because you are filling needs more effectively- everyone who would have their personal needs filled more valuably by the competition patronizes the competition, driving their profits instead of yours.
Right. So I am saying that businesses can affect both the price, and the affording.
In a trade balance sense, where imports are perceived to reduce the economic viability of an area and exports are perceived to increase it? Or are you saying that businesses that pay low wages are harmful compared to businesses which pay high wages, sell the same amount of the same product (at a higher price), make the same profit, and distribute that profit the same way?
The trade balance perspective is a pretty interesting one :P If the locals spend money at your store, how does it get back to the locals so they can buy more stuff? Is the entire cycle good for the locals (typical import/export), or is there a tragedy of the commons problem (the people hurt aren’t necessarily the same ones who shop at your store)?
But what I was mainly thinking of was labor distribution. The economy is (from the pragmatist perspective) a system for distributing goods and labor to where they’ll benefit people, better than a central planner could do it. If goods were previously produced locally, and now you import them, that’s not making the distribution of goods worse, but it can make the distribution of labor worse, imposing costs on the local economy. Moving people around is a pain.
The store hires locals to man it, and pays taxes at the local rates. The local currency (henceforth: lc, symbol #) can only be exchanged for foreign currency (henceforth: dollars, $) if there are things which can be purchased using the local currency that people who have foreign currency want. If the lc isn’t worth anything, nobody can make a profit buying bread for dollars and selling the bread for lc.
I think that it is overwhelmingly likely that the areas with the highest unemployment will have the lowest labor costs; If that is the case, the businessman imports wheat into that area, bakes it using local labor, and sells it in lc; he has now changed some amount of dollars into some amount of lc. He then invests that lc into a labor-intensive product and ships that product back home to sell for dollars.
Exactly the same thing can and does happen within a single currency: raw materials are shipped from where resources are plentiful to where labor is plentiful, and finished goods are shipped back out. The major hurdle is scarce raw materials limiting the number of factories that it is possible to operate, followed by political control of the economic system in order to ‘keep jobs’ within the privileged group.
On the contrary, a capitalist believes there is abundant evidence that increased competition in any market almost always generates positive externalities, and is a net benifit to the community. Endless volumes have been written on this topic, and while there have been some attempts to argue the opposite case none of the ones I’ve seen are especially convincing. So ‘open a business instead’ isn’t a thoughtless reflex, it’s a carefully considered opinion about what course of action has the highest likelyhood of generating positive results in an uncertain world.
The first half, of course, is a lot less firmly supported. While unearned wealth certainly has a tendency to produce negative side effects, there isn’t a lot of hard data on how strong this trend is. Certainly, it seems hard to argue that a starvig man is worse off if you give him a free loaf of bread.
Of course in reality it generally isn’t possible to give large amounts of resources to the needy, especially in poverty-stricken nations. Whever you try it the local kleptocrats will quickly arrange to steal the majority of your donations and use them to maintain their own power, so the real effect of most international charity is simply to prop up corrupt regimes and allow them to get away with oppressing their own people.
Hm. Well, this is reasonable—competition is pretty nice. But if you have a society that’s just plain old less efficient than ours—uses lots of human labor rather than industrialization, doesn’t have good economies of scale, etc etc—and I go in and open up some store that simply offers lower prices on widgets than the local stores can offer, this doesn’t particularly increase competition. The other stores aren’t going to build economies of scale overnight, they simply go out of business, and so now I have all the local widget sales.
It happens to be a claim that meshes with an identity as “capitalist,” and shows signs of being protected from details by the first good argument.