|
| |||
|
Capitalism's foes confuse money with profit, thereby giving themselves trouble | |||
|
By DAVID MOON, Moon Capital
Management Has capitalism seen its better days? Are the recent scandal revelations evidence that capitalism is ailing, if not fundamentally flawed? Capitalist ideologues argue that the profit motive is the panacea of all collective and individual ills, but how does that explain Enron and Arthur Andersen? Aren't these examples proof that some better, more just ethic should drive our economic society? No. Joseph Schumpeter once said that all of the features and achievements of modern civilization are, directly or indirectly, the products of the capital process. Critics call this sort of thinking destructive, selfish and shortsighted. Martha Stewart is capitalist, but she is also a woman. I am no more willing to declare females a failure than I am to declare capitalism a failure. Profit is the energy of life. Not money, but profit. In their short-sightedness, Ken Lay, Sam Waksal and folks like them confused money with profit. The term "profit" originates from the Latin word "proficere," which means "to make progress." At its very root meaning, to profit is to make better. It is easy to see how Bill Gates and Thomas Edison served mankind and financially enriched themselves in the process. But why did they do what they did? Why is Warren Buffett a billionaire? Why does any great achiever achieve great things? Great men and women achieve great and useful things when in the pursuit of their passion. Money is not their motivator. It may be how they keep score, but they are able to maintain the tenacity necessary to achieve when they are consumed with an unquenchable thirst for their endeavors. Even Mother Teresa or the unknown hero at your church "make progress" (or "profit") in a societal sense. And they often do so at great financial costs to themselves. But even they act in their own self-interests, because they do what they are called to do. They do what they are driven to do, no differently than does Bill Gates. That some people do so in poverty only proves the point that more clearly: how could a person as talented and tenacious as Mahatma Gandhi or Martin Luther King not be motivated by an intense personal drive? How else could they withstand the hardships cast upon them because of their actions? How about Galileo or Columbus? The only way they could have maintained their persistence, in the face of daunting obstacles, was to be personally driven to their ends. They did what was in their self-interests, and in so doing, they served society. * * * * * " For what shall it profit a man, if he shall gain the whole world, and lose his own soul?" When John Rigas looted Adelphia Communications and used it as his own private piggy bank, he was motivated by money or greed - not profit. It was not in his self-interest to pilfer his shareholders' assets, even though he may have convinced himself otherwise. After the arrest of Rigas and his two sons (each of them facing 100 years in prison) it is difficult to argue that he acted in his own self-interests. Nor was he rational. He was stupid or sick or evil - but he wasn't representative of capitalism. New Testament writers suggests that profit is a good thing - an outcome so valuable that it shouldn't be tossed away in the pursuit of "the whole world." Profit, not money or riches or fame. That is the mistake of capitalism's critics; they fall prey to the same allure that traps people like John Rigas - they mistakenly define "money" as self-interest. David Moon is president of Moon Capital Management, a Knoxville-based investment management firm. This article originally appeared in the News Sentinel (Knoxville, TN).
|
