Tag Archives: Creativity

Richard Epstein explains why economic inequality is required in order to promote innovation

My friend Matt, who blogs at The Conscience of  a Young Conservative, posted this on Facebook.

Epstein explains how the profit motive creates economic value that raises the standard of living of all people, who are able to exchange their money for valuable products and services that they did not create. He explains how wealth redistribution is wasteful and harmful to economic growth.

(Found here)

Now let’s look at some myths that Christians believe about economics.

We need to understand basic economics

Christian philosopher Jay Richards explains basic economics.

Excerpt:

THE ZERO-SUM GAME MYTH.

There are three kinds of games: win-lose, lose-lose, and win-win. Win-lose games, like basketball, are sometimes called “zero-sum games.” When the Celtics and the Bulls compete, if the Celtics are up, then the Bulls are down, and vice versa. The scales balance. It’s a zero-sum.

Besides lose-lose games, which most of us avoid, there are positive-sum, or win-win, games. In these games, some players may end up better off than others, but everyone ends up at least the same if not better off than they were at the beginning.

Millions of people think that the free trade in capitalism is a dog-eat-dog competition, where winners always create losers. This is the zero-sum game myth, which leads many to think that the government should somehow redistribute wealth. While some competition is a part of any economy, of course, an exchange that is free on both sides, in which no one is forced or tricked into participating, is a win-win game. When I pay my barber $18 for a haircut, I value the haircut more than the $18. My barber values the $18 more than the time and effort it took her to cut my hair. We’re both better off. Win-win.

THE MATERIALIST MYTH.

A similar myth leads people to think of the economy as some fixed amount of material stuff—money in safes or gold bars in a vault. Since two firms competing for one customer can’t both get the customer’s money, we might think the whole economy looks that way: wealth itself isn’t created, it’s merely transferred from one party to another.

A common image of this “Materialist Myth” is a pie. If one person gets too big a slice, someone else will get just a sliver. To serve it fairly, you have to slice equal pieces.

This isn’t how a free economy works, however. Over the long run, the total amount of wealth in free economies grows. We can create wealth that wasn’t there before. The “pie” doesn’t stay the same size. Under capitalism, someone can get wealthy not merely by having someone else’s wealth transferred to his account, but by creating new wealth, not only for himself, but for others as well.

THE GREED MYTH.

Friends and foes of capitalism often claim that it is based on greed. Writer Ayn Rand even claimed that selfishness is a virtue (see the accompanying feature article). But greed is one of the seven deadly sins. If capitalism is based on it, then Christians can’t be capitalists.

In truth, Adam Smith and other capitalist thinkers did not believe this “Greed Myth.” Rather, Smith argued that capitalism, unlike static economies, channels even greedy motives into socially beneficial outcomes. “In spite of their natural selfishness and rapacity,” Smith wrote, business people “are led by an invisible hand…and thus without intending it, without knowing it, advance the interest of the society.”3

Rather than inspire miserliness, capitalism encourages enterprise. Entrepreneurs, including greedy ones, succeed by delaying their own gratification, by investing their wealth in creative but risky ventures that may or may not pan out. Before they ever profit, they must first create.

In a fallen world, we should want an economic system that not only channels greed into productive purposes, but unleashes human ingenuity, creativity, and willingness to risk as well.

I think Christians who don’t understand economics really need to make the effort to understand the basics. I recommend Robert Murphy’s “The Politically Incorrect Guide to Capitalism” and Thomas Sowell’s “Basic Economics“. If you want to see how economics works together with Christianity, then you also want Jay Richards “Money, Greed and God” and Wayne Grudem’s “Politics According to the Bible“.

Poll: Disengagement grows the longer workers stay in government jobs

Map of Canada
Map of Canada

From the Ottawa Citizen. (H/T Andrew)

Excerpt:

Recent post-secondary graduates recruited by the federal public service appear to become more disengaged and less ambitious the longer they’re in their jobs.

That’s a key conclusion of a new study that provides an intriguing window into perceptions of government employment by new public service hires and potential recruits. The study, recently posted to a government website, was done for the Public Service Commission by EKOS Research Associates.

It involved online surveys with two groups of people hired through the government’s Post-Secondary Recruitment Program (PSR), as well as recent hires recruited through other methods and “potential recruits” — mostly university graduates under age 35.

As part of the study, EKOS re-interviewed 219 PSR recruits who were surveyed in an earlier phase of the study in 2009. It found some “troubling shifts” in their attitudes.

The importance these recruits attach to “key intrinsic job aspects” has declined over the past year, the study reports. The weight they give to the opportunity to be creative declined by nine percentage points from 2009 to 2010, it says, while the importance they attached to the prestige associated with their jobs fell by 10 points.

There were also smaller declines in the importance ascribed to meaningful work and opportunities for career advancement, while “more extrinsic issues” — such as attractive compensation and a good work-life balance — assumed greater significance.

“These findings suggest that PSR recruits become less ambitious/intrinsically motivated as they spend more time in the federal public service,” the study concludes.

Can people who are disengaged serve the public as well as private sector workers whose compensation and continued employment depends on their being engaged in their work? This is why we need to privatize as much as possible.