poverty Archives — Laissez FaireLaissez Faire

Our latest Forbes column tells the story of Andrew Carnegie’s rise. Personally, I think it’s one of the best pieces we’ve written:

Long after he had established himself as one of America’s leading businessmen, as well as history’s greatest steelmaker, Andrew Carnegie reflected that “We all live in the richest and freest country in the world, where no man is limited except by his own mental attitude and his own desires.”

At the time—a decade or so before the First World War—Carnegie’s attitude was nearly universal. In America, anyone could carve out a better life for himself if he worked hard. Today, Carnegie’s attitude is considered almost quaint.

Opportunity? Why, opportunity is a rare thing, and those Americans not lucky enough to be born with it should be given it at other people’s expense. Whether it’s an education, a job, a house, or a grant, opportunity is seen as something that others have to provide you with. If you don’t succeed, it’s not because you failed to capitalize on plentiful opportunities. It’s because you just weren’t one of the fortunate few.

Whole thing here.

On this installment of Leonard Peikoff’s podcast, Yaron talks about:

• The morality of being friends with someone on food stamps
• Ayn Rand and free markets
• Disaster relief
• Whether the U.S. faces a currency crisis
• And more

You can listen here.

To the extent a country is free, lifting yourself out of poverty and into prosperity is a matter of your thinking and your actions. Walter Hudson expands on that theme, offering up five ideas that are critical for escaping poverty. Here’s one of them.

5) Understand Value and How to Create It

In spite of the descending order, these ideas are presented from the most foundational. If readers do not understand value and how to create it, the rest of this list will do them little good.

Let’s be honest. Upward mobility is a euphemism for making more money. There is no shame in that, and we shouldn’t gloss it over. Contrary to the cliché, money can buy happiness. While maintenance of long-term happiness requires more than money, try staying happy without it.

Consider why money is essential to happiness. All living things act to stay alive and improve life’s quality, to survive and thrive. That which we act to obtain and keep is the essence of value. Plants value sunlight, minerals, carbon dioxide, and water. They act, albeit slowly, to obtain those values. Animals likewise seek after the necessities and comforts of life. Man, the rational animal, is unique in his ability to transcend instinct and conceive of new values which did not previously exist. A sharper, lighter spear; a stronger, tighter basket; a way to harness fire or travel over water — such inventions and innovations are values which build upon one another to enable a quality of life theretofore unimaginable.

Since none of us are born innately aware of how to produce the many conceived values enhancing our lives, we come to benefit from them through trade. Can’t make a spear to save your life, but crank out gathering baskets by the dozen? You’ve got a trade. Money is our medium of exchange, something easily portable and generally expected to hold its value. In short, money is the stand-in for any conceivable value we may obtain through trade.

Understanding this helps us dispense with the sophomoric notion that money is the root of all evil, or that we ought to shy away from accumulating it or apologize for having it. It is through the production of value that we “make money.” Dad was right when he said it doesn’t grow on trees. Nevertheless, it can grow if properly cultivated. By identifying what value we are adept at creating, we position ourselves to take the first step toward rising from poverty, earning an income.

Granted, if you are poor, it may be that the value you are capable of producing does not command much in the market. Even so, the most menial of productive tasks can be the seed from which upward mobility springs, provided you embrace the rest of our presented ideas.

Read the whole thing here.

If you would like to ask me a question, you can submit it here.

Whenever I read articles like this one, which declares “the minimum reward for work in America should be $10 an hour plus health coverage,” my first thought is always: why not $1000? Why not $1,000,000?

Of all the issues in economics, one of the least controversial is that minimum wage laws do not raise workers’ wages—they increase the number of workers who cannot be employed. If you are young and unskilled and your productive contribution is only $9 an hour, no one is going to pay you $10.

Those pushing to raise the minimum wage pose as concerned with the welfare of low-pay workers. But in reality they show utter contempt for all individuals. If I am willing to accept work for $9 and an employer is willing to pay me $9, what in the world justifies a Washington Post columnist (or a Washington bureaucrat) sticking his nose in and declaring that our desires are irrelevant, and he is going to decide what’s best for us?

Anyone concerned with seeing incomes rise would investigate the source of rising incomes: increasing productivity. Government price controls restricting the voluntary arrangements of individuals can’t achieve that—but they can hamper and destroy it.