[January 16, 2003]

(Version also published on 2/11/03 in Capitalism Magazine: The Mystical, Magical "Economy")

"The Economy" or Your Life?

by Wayne Dunn

Many speak of "the economy" as if it were some mystical god we exist to serve: Tax cuts for the rich won't help "the economy." Will that plan boost "the economy?"

A nation's economy is not a cause but an effect: the effect of the productive activities of a multitude of individuals-- or their stifling.

If individuals are free to pursue their own interests, then, naturally, the group as a whole is wealthier. But if they aren't free-- free primarily from interference by an institution that properly exists only to defend them, the government-- then the group as a whole suffers. For proof, compare totalitarian North Korea to (relatively) free America.

Notice that America, history's most prosperous country, is based not on serving a king or state or church or group or "the economy," but on each individual having the right to life, liberty, and the pursuit of happiness.

The main but oft-overlooked precondition for prosperity, then, is individual rights--in other words, freedom.

That's why it's wrong (and fundamentally un-American) to regard "the economy" as something before which individuals must bow. And conservatives are wrong to promote tax cuts on that basis; tax cuts do, of course, help the economy, but that's not their justification. For even if a proposed cut doesn't portend much "economic stimulus," one should support it anyway. Why? Because people have a moral right to what they earn.

To illustrate, imagine if the police nabbed a local thief and told victims to come reclaim their possessions. When you recoup your diamond bracelet, a pack of neighbors begin howling, "Why does she get more than we do? The rich are getting richer! She shouldn't receive that unless it helps the economy!"

If you exist to serve "the economy," if you have no right to what's yours, then those howlers have a point-- and so do tax-lovers.

Just as I'm not damaged if police manage to recover my neighbor's stolen goods but not mine, neither am I damaged when other people get tax cuts. What damages me is the original theft-- even if the thief bolsters "the economy" by spending what he stole, or by giving it to the poor, or by using it to start a business or whatever. The ends don't justify the means.

Indeed, one benefits not only from one's own freedom and money, of course, but from other people's also. Businessmen benefit from people being able to buy their goods and services. Those lacking the capital, talent or desire to own or run a business-- including those who are dirt poor-- benefit from risk-taking capitalists being able to buy their labor.

But one doesn't have to even own or be employed by a company in order to benefit from it. For instance, I personally don't own any stock in, say, hotels. But it's to my advantage that there are wealthy people who build and operate them: I can rent a room when I need one. Or an airline: I can fly when I please. Or lumber companies: things made of wood are available for me to purchase. And so forth. Yet I bear none of the stockholders' risks or executives' headaches (unless the government uses my tax dollars to bail out failing companies, which violates the free-market principle--as Republicans often do).

Indeed, we all profit by others possessing capital and the liberty to deploy it. But if they are taxed into oblivion, though the rest of us may get a cut of the loot, it hurts us in the long run.

Consider where we would be today if young Henry Ford or Thomas Edison (or their financial backers, had they any) had been obstructed by government taxation. Would the poor have a higher standard of living without electricity and all the inventions stemming from it? Would they be wealthier without cars-- or the products of the mass-production methods Ford originated?

It's time Americans rediscover that while exercising their freedom, some individuals may actually make more money than others do, but that everyone wins. And it's time that tax-cut proponents realize the full extent to which the moral and practical arguments are on their side.

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© COPYRIGHT 2003 by Wayne Dunn