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Polhill: Profit has made the world a better place
May 5, 2023 By Dennis Polhill
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In 1776 the Founders rebelled against the slavery of feudalism, wherein the
King owned all property and all people.
Once people were allowed to own themselves, and their production, a tsunami of
economic growth and prosperity was unleashed. The liberty of innovation and
hard work were rewarded and all of society benefited. “The shining City on a
Hill” had come into being long before anyone thought to label it that.
Invention became the foundation for further invention. For example, steam
engines, once invented, were adapted for use on boats, trains, carriages,
factories and farms. Other forms of slavery eventually became obsolete, as more
and more machines came to relieve humans of their drudgery. The success of the
Founder’s experiment has succeeded far beyond what any of them could possibly
have ever dreamed. Their prediction that the patent office would soon become
obsolete because everything possible would have been invented, was obviously
wrong, but not unreasonable based on what they could have possibly known then.
Work could be saved up and innovation (invention and efficiency) rewarded,
freeing all to buy luxuries of their choosing. Overproduction yielded trade:
One has too many apples and his neighbor has potatoes, so they both benefited
by sharing via trade. Trade enriched both. Stable currency expedited trade. For
the first time in human history a population was self-actualized,
self-motivated, self-reliant and excessively productive.
Toleration expanded. Fewer Puritans persecuted Catholics or Methodists over
their differences, because it was in the mutual self-interest of both to share
by trading. When all are busily improving their lives, the lives of all improve
and there is little time for hatred or mischief.
The great thinker Walter Williams said it succinctly, “Prior to capitalism, the
way people amassed great wealth was by looting, plundering and enslaving their
fellow man. Capitalism made it possible to become wealthy by serving your
fellow man.”
The Founders did not know, did not invent, and did not use the word
“capitalism.” The word was first used by French socialist Louis Blanc in 1850,
not Karl Marx as many believe, to disparage ownership, hard work, and saving.
Capitalism originates from the Latin word “capitalis,” which means “head of
cattle”… a means of measuring wealth.
Money, like any weapon, is a tool to be used for good or evil. A weapon can be
used to fend off violence or to rob a bank. The tool-user is the one who
decides. Similarly, money is a tool to be used by its owner for good or evil.
Jealous bystanders interviewed by the news lament large sums spent on a work of
art when that money could have been used to add a wing on the hospital. But the
money did not just disappear. Maybe the art seller, who now has that cash,
will choose to add the hospital wing. Or if the art dealer trades his cash for
a boat, maybe the former boat owner will choose to add the hospital wing.
Because someone uses their money in a way other than you prefer, does not make
them wrong or evil.
Modern Marxists have become masters at manipulating word meanings. When profit,
money, or capital are used as pejorative, a modern Marxist is speaking and the
wise will hang on tightly to their wallets.
That the word “profit” is now used so often as a pejorative, as if profit is
theft, merits defense. Critics of hard work should remember that 80% of US
capitalist enterprises are small businesses. Many small businesses are
family-owned sole proprietor businesses. Because the owner is paid last, a
profit simply means he got something, which, in turn means lots of other people
(employees, vendors, etc.) also got paid. A good thing for many folks. Many of
these tiny businesses make little or no profit. Many owners toil day and night
for the success of their business. A small catastrophe might be all it takes
to end them. Rather than vilification, a little thanks and appreciation might
help them through another day.
Dennis Polhill is a senior fellow at the Independence Institute, a free market
think tank in Denver.
