Editorial
Frank Rich's Prejudice
Karl Marx was famous for, among other things, claiming that everyone always promotes his or her economic interest. This is something he actually had in common with non-Marxist classical economists.
Most economists, in fact, believe that we are all motivated by our economic interests, nothing else. Or, rather, everything else that might appear to motivate us really comes down to economics. Consider the following from a few very prominent non-Marxist economists. The late Milton Friedman, one of the modern age's most famous and diligent students and defenders of the free-market system, said it most directly: "[E]very individual serves his own private interest... The great Saints of history have served their "private interest" just as the most money grubbing miser has served his interest. The private interest is whatever it is that drives an individual." His colleague, the late George Stigler, another Nobel Prize winner, made the point only slightly differently: "Man is eternally a utility-maximizer – in his home, in his office (be it public or private), in his church, in his scientific work – in short, everywhere." Finally Nobel laureate Professor Gary Becker, who also embraces this homo economicus viewpoint, underscores the idea as follows: "The combined assumptions of maximizing behavior, market equilibrium, and stable preferences, used relentlessly and unflinchingly, form the heart of the economic approach as I see it." The bottom line: We are all driven by our desire to fare well economically, first and foremost.
Marx also held to this idea, at least so far as people in the capitalist phase of humanity's development are concerned. We act to enrich ourselves and whatever else we might claim motivates us, it is really just self-enrichment.
Frank Rich, prominent columnist at The New York Times and a relentless foe of the free market, capitalist economic system, has just now latched on to the story of the brothers Koch of Wichita, Kansas, David and Charles – there is another who isn't so directly involved in the Koch business enterprises – a story told extensively in The New Yorker recently, by Jane Mayer. Rich is very impressed by this story and interprets it in the way many economists would, namely, that everything done by the brothers Koch has to do with their desire to enhance their wealth. But the economists would say this about all of us, not the the brothers Koch.
Of course, Rich merely infers his claims from the story – he fails to give one solitary good quotation from either David or Charles Koch to substantiate his allegation that they are both interested solely in self-enrichment. No wonder, because it is not so.
I have had the good fortune to make the acquaintance of both of the Koch brothers, although we aren't fast friends by any means. But way back when I was a graduate student in philosophy, Charles took an interest in my work on my doctoral dissertation and invited me to give a talk about it in Wichita. It had to do with human rights and whether we can know that there are such rights or do some of us simply have a strong feeling in favor of them. Later I served, briefly, on the board of the Reason Foundation (which grew out of Reason Enterprises, the tiny firm that published Reason magazine in its early incarnation) with David Koch. So I can attest without any reasonable doubt that what motivated and likely still motivates the brothers Koch is their firm commitment to the ideas and ideals of a fully free society, a la the Declaration of Independence.
Now it is often held by the likes of Frank Rich – such as Ralph Nader and Kevin Phillips – that those who favor a fully free society are only interested in promoting their own economic welfare. Is this credible?
No. Of course, true enough, a fully free society would also be economically free, just as it would favor religious liberty or freedom of the press or everyone's right to, say, sing in the shower and marry whoever they want who would want them. Freedom for those of us who love it isn't divided into economic, religious, journalistic, scientific and other parts. It is indivisible, a general proper condition for human community life, period. This is what the Koch brothers have always championed.
Now just like journalists who favor freedom of the press benefit from such freedom, the Koch's naturally would benefit from freedom of commerce. But so would we all. Freedom, not surprisingly, is simply good for us all and this includes entrepreneurs such as the brothers Koch. Now do they – do we all who champion a fully free society – support liberty solely because it enhances our economic welfare? No, I am certain of that – I, who have hardly a dime to my name, certainly favor liberty in part because it enables me to earn a living with the support of those of my fellows who freely choose to pay me for my work. But is this the sole reason why I favor liberty? Is it the sole reason the brothers Koch do so? Wrong! Not by a long shot.
Just ask us. Don't ask Frank Rich, who makes his claims based on his prior beliefs, independently of any evidence from the brothers themselves.
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Posted by Doug Muder on 03/14/11 11:11 AM
It's awfully easy for people to convince themselves that they have noble reasons for holding a self-serving worldview. I'm sure they talk a good game in person, but take a step back and appreciate how self-serving the Kochs' worldview is.
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Posted by Dem. on 09/27/10 12:52 AM
NubCakes
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Posted by Mark Humphrey on 09/04/10 01:03 AM
This point is important.
People on the left believe that political motives usually boil down to personal financial calculus. Maybe my anger distorts my thinking, but I wonder if this preoccupation is psychological projection. Left-wingers I know seem obsessed with getting an easy life"not as a consequence of personal achievement, but as a birthright and at high cost to others.
I also see this view crop up frequently among commentators on the right. Thus, central bankers are said to care only about protecting large banks or preserving their own pensions; investment bankers from Goldman Sachs or Morgan Stanley are referred to as "banksters'; and voters are said to support welfare politics simply because they want free money.
When they embrace this view, both left and right see man as a spiritually barren being"incapable of true understanding, bereft of moral values. This is one more sign of trouble in our times.
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Posted by Ian MacFarlane on 09/01/10 12:55 AM
"Champion" is my word and your misinterpretation.
Defend any position found in these postings short the self-serving, flexible, definition applied to "free enterprise".
You must know the existence of a "law" does not make it right.
Do you really believe that no "harm" direct or otherwise comes to those who helped make but do not participate in the billions these brothers hoard?
As a member of the human race i am free to offer criticism as you are free to tell me that I am full of soup.
Must I wait for harm to visit me before I observe that visited on others?
It may be that a day after either of us die the world is bombed to oblivion and those who remain will be living in caves.
No man is an island.
It is unfortunate that a forum of this nature which can and should be used for the presentation of thoughtful ideas regardless their political point of departure is often reduced to carping.
I do not exclude myself.
We should be offering criticism in its' original sense, to separate the wheat from the chaff. While for the most part it appears the participants of this forum have good minds, the thoughts offered are too often chained to a predetermined and seemingly unchangeable position.
No one philosophy answers all questions but with honesty and patience we can learn to understand the basis underlying each other's position.
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Posted by Fredrick Porter on 08/31/10 11:58 PM
The observation from K. Goodenough was spot on: sans accumlated wealth, we'd all still be in caves. The laziness of victimhood explains the cranks and malcontents who cannot accept the accident of birth and circumstance. As for the chimeras of our own age, that is, freedom and liberty, as long as I have a stomach to fill and a back to keep warm, can I ever be "free?"
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Posted by Keith Goodenough on 08/31/10 06:55 PM
@ Mr MacFarlane,
You are certainly free to proclaim yourself a "champion", and an overwhelmingly charitable one at that. You are also free to advertise your lack of interest in the future of your family. But has it never occurred to you that, in promoting, as you do, resentment against individuals who are lawfully using their own talents and and their own lawfully-acquired private property to develop businesses which depend on serving satisfactorily those who freely choose to be their customers, you are contributing to mere human conflict in this world, which, God knows, has enough of it already? Has it never occurred to you that it is none of your affair how people who do no direct harm to you manage theirs?
If everyone had started from scratch, humans would still be living in caves. It may of course be that such accommodation would be quite acceptable to you, perhaps with the proviso that no other cave was more comfortable than your own. There now! See what you've done. Dragon now seems resentful, too.
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Posted by DRAGON on 08/31/10 05:38 PM
Frank Rich's Prejudice ... Ah Yes! Only a blind entrenched right winger is unable to see the irony of personally pounding the reputation of another writer and his views while "preaching" his own narrow minded prejudice! Further, your "respect" for the "brothers" says far more about you than them!
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Posted by Bill on 08/31/10 01:49 PM
No mention of behavioral economics vs. rational economics?
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Posted by Mary Boud on 08/31/10 12:53 PM
Another excellent article by Dr. Machan.
Economics is not the only or primary freedom as some commenters seem to think. Two other vital factors are: a) freedom from addictions and b) freedom from sin, both of which tend to bind a person to destructive habits and close his/her mind to the possibility of divine guidance. Such a person is not free. In a very real sense, he is enslaved.
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Posted by Klaus Kaufmann on 08/31/10 11:58 AM
What's the great revelation here? It doesn't take PhDs to realize simple truth. Berthold Brecht said it better in the Three Penny Opera: Erst kommt das Fressen, dann kommt die Moral! [A hungry man has no conscience or literally: First comes devouring then comes morals.] Perhaps that's part of our social problem, unless the facts come from the mouths of intellectuals, they don't count. Perhaps we need to return to a simpler view of life...
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Posted by Ian MacFarlane on 08/31/10 11:20 AM
Although it may be judged from earlier posts that my philosophy is in opposition to free enterprise I am in fact a champion of this philosophy.
Accepting this thought however does require that an understanding of what is meant to me by the term "free market".
Although howls of protest are likely to follow from the so called defenders of this philosophy, who are published with regularity in the Bell, all seem to agree that the aggrandizement of economic power regardless of its origin and/or sustenance is acceptable.
Oddly, concord, with few caveats, will be expressed by me.
Those caveats are with regard to inherited wealth and wealth which is built on the work of others.
I have three children who will share in our family wealth for their physical growth and educational needs until they leave home. At that point they are on their own. They will receive nothing by way of financial assistance and if there is any money left by the time my wife and I die it will be left to medical research and charity for orphans.
The brothers Charles and David Koch inherited not only wealth but also the means to maintain it.
They did not start from scratch and build the conglomerate they presently control anymore than a majority of the extremely wealthy in this or any country started and built their business empires.
They built their holdings from approximately $200 million in 1967 to an estimated value of $100 billion today.
Does this speak for their ability to start from lesser means and build the empire they control today?
Does their ownership of Georgia Pacific indicate a knowledge and understanding of the environmental concerns raised by the manufacture of paper cups and towels? Does commodity trading indicate more than an ability to trade paper at a profit or loss?
These men born into wealth, well educated and clearly possessing more than passing knowledge about the businesses they control, but unlike their forbears, who intimately understood the tools of their trades, they did not share the hands on, labor intensive, field experience which brought them their wealth.
I do not mention this to denigrate their abilities but I question the respect and reward given to individuals who shuffle papers more than shovel dirt. One does not increase labor intensive wealth accumulation 500 fold by dint of his or her individual effort.
As with their father there are many who helped in the construction of the wealth these brothers control. No matter any justification, no one individual 'earns' $19 billion dollars in a lifetime. It takes many lifetimes of work by many people to amass a fortune of this size.
Even if one were to accumulate wealth from birth at a dollar a second it would take over 500 years to "earn" $19 billion.
Is the accumulation of exceptionally great personal wealth extant in the world the result of the efforts of individuals who started from scratch?
Is some form of exploitation necessary and even acceptable? Does the end justify the means?
What appears to be published here is a respect for "not so" free enterprise more so than a genuine, start from scratch, independent, accumulation of wealth.
Trite as it is 'having your cake and eating it too' comes to mind.
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Posted by Shantu Dand on 08/31/10 10:50 AM
Dr.Machan,
Concept of self-interest is easy to grasp. What I find difficult to understand is the millions of people who preach wealth redistribution as a cure-all. Do they exclude their own wealth from their redistribution schemes? That would make them hypocrites. However, since they want to achieve this redistribution through the agency and power of the government, they cannot preserve their own wealth, or can they? Don't they have same self-interest to preserve their own wealth as is the case with all other mortals? Are they an exception to the observation of Marx and Adam Smith?
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Posted by Rom on 08/31/10 10:19 AM
"Freedom for those of us who love it isn't divided into economic, religious, journalistic, scientific and other parts."
Ok, but the foundation of all freedom is economic, especially in todays world. If we start off with a small group of people who become dominant economically through usury (unlimited increase) in a limited world, in a short time we do end up in a world where all the other freedoms you mention are diminished and destroyed, by the usurer.
Ezra Pound:
This war didn't begin in 1939. It is not a unique result of the infamous Versailles Treaty. It is impossible to understand it without knowing at least a few precedent historic events, which mark the cycle of combat... This war is part of the age-old struggle between the usurer and the rest of mankind: between the usurer and peasant, between the usurer and producer, and finally between the usurer and the merchant...
Usurers provoke wars to impose monopolies, so that they can get the world by the throat. They provoke wars to create debts, so that they can extort the interest and rake in the profits resulting from changes in the values of monetary units. A nation that will not get into debt drives the usurers to fury. This war is a chapter in the long and bloody tragedy which began with the foundation of the Bank of England in far away 1694, with the openly declared prospectus: 'The bank hath the benefit of the interest on all monies which it creates out of nothing'.
Usury has gnawed into England since the days of Elisabeth. First it was mortgages, mortgages on earls' estates; usury against the feudal nobility. Then there were attacks on the common land, filching of village common pasture. Then they developed a usury system, from Cromwell's time, ever increasing... They are working day and night, picking your pockets. Every day and all day and all night picking the Russian working man's pocket.
I do not want my compatriots from the ages of 20 to 40 to go get slaughtered to keep up the Sassoon and other British Jew rackets in Singapore and Shanghai... No Roschild is English, no Baruch, Morgenthau, Cohen, Lehman, Warburg, Kuhn, Kahn, Schiff, Sieff or Solomon was ever born Anglo-Saxon. And it is for this filth that you fight. It is for this filth that you murdered your Empire...
Wars are destructive to nation-states but profitable for the special interests. International bankers, Jewish bankers in particular are those who are the primary beneficiaries of the profits from war. Sometime the Anglo-Saxon may awaken to the fact that nations are shoved into wars in order to destroy themselves, to break up their structure, to destroy their social order, to destroy their populations.
Understanding of usury is central to understanding of history. Until you know who has lent what to whom, you know nothing whatever of politics, you know nothing whatever of history, you know nothing whatever of international wrangles.
There is no freedom without economic freedom. Freedom that doesn't include freedom from debt is plain bunkum. It is fetid and foul logomachy to call such servitude freedom...
